1
EXHIBIT 4.3
================================================================================
AMENDED AND RESTATED DECLARATION OF TRUST
OF
HAMILTON CAPITAL TRUST I
Dated as of December [__], 1998
================================================================================
2
TABLE OF CONTENTS
Page
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.........................................................................2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application....................................................9
SECTION 2.2 Lists of Holders of Securities......................................................9
SECTION 2.3 Reports by the Property Trustee....................................................10
SECTION 2.4 Periodic Reports...................................................................10
SECTION 2.5 Evidence of Compliance with Conditions Precedent...................................10
SECTION 2.6 Events of Default; Waiver..........................................................10
SECTION 2.7 Default; Notice....................................................................12
ARTICLE III
ORGANIZATION
SECTION 3.1 Name...............................................................................13
SECTION 3.2 Office.............................................................................13
SECTION 3.3 Purpose............................................................................13
SECTION 3.4 Authority..........................................................................13
SECTION 3.5 Title to Property of the Trust.....................................................14
SECTION 3.6 Powers and Duties of the Administrative Trustees...................................14
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees...............................17
SECTION 3.8 Powers and Duties of the Property Trustee..........................................17
SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee........................20
SECTION 3.10 Certain Rights of Property Trustee.................................................22
SECTION 3.11 Delaware Trustee...................................................................24
SECTION 3.12 Execution of Documents.............................................................24
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.............................24
SECTION 3.14 Duration of Trust..................................................................24
SECTION 3.15 Mergers............................................................................25
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities............................................27
SECTION 4.2 Responsibilities of the Sponsor....................................................27
i
3
SECTION 4.3 Right to Proceed...................................................................27
SECTION 4.4 Right to Dissolve Trust............................................................28
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees; Appointment of Co-Trustee......................................28
SECTION 5.2 Delaware Trustee...................................................................29
SECTION 5.3 Property Trustee; Eligibility......................................................29
SECTION 5.4 Certain Qualifications of Administrative Trustees and
Delaware Trustee Generally.........................................................30
SECTION 5.5 Administrative Trustees............................................................30
SECTION 5.6 Appointment, Removal and Resignation of Trustees...................................31
SECTION 5.7 Vacancies among Trustees...........................................................33
SECTION 5.8 Effect of Vacancies................................................................33
SECTION 5.9 Meetings...........................................................................33
SECTION 5.10 Delegation of Power................................................................34
SECTION 5.11 Merger, Conversion, Consolidation or Succession to Business........................34
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions......................................................................34
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities............................................35
SECTION 7.2 Issuance of Series A Capital Securities and Common Securities......................35
SECTION 7.3 The Trust Security Certificates....................................................36
SECTION 7.4 Execution and Delivery of Trust Security Certificates..............................37
SECTION 7.5 Registrar, Paying Agent and Exchange Agent.........................................37
SECTION 7.6 Registration of Transfer and Exchange of Series
A Capital Security Certificates....................................................37
SECTION 7.7 Book-Entry Series A Capital Security Certificates;
Common Security Certificate........................................................38
SECTION 7.8 Paying Agent to Hold Money in Trust................................................39
SECTION 7.9 Replacement Securities.............................................................39
SECTION 7.10 Outstanding Series A Capital Securities............................................39
SECTION 7.11 Series A Capital Securities in Treasury............................................40
SECTION 7.12 Cancellation.......................................................................40
SECTION 7.13 CUSIP Numbers......................................................................40
ii
4
ARTICLE VIII
DISSOLUTION OF TRUST
SECTION 8.1 Dissolution of Trust...............................................................41
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.............................................................42
SECTION 9.2 Definitive Series A Capital Security Certificates..................................42
SECTION 9.3 Temporary Securities...............................................................44
SECTION 9.4 Deemed Security Holders............................................................45
SECTION 9.5 Notices to Clearing Agency.........................................................45
SECTION 9.6 Appointment of Successor Clearing Agency...........................................46
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability..........................................................................46
SECTION 10.2 Exculpation........................................................................46
SECTION 10.3 Fiduciary Duty.....................................................................47
SECTION 10.4 Indemnification....................................................................48
SECTION 10.5 Outside Businesses.................................................................51
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year........................................................................51
SECTION 11.2 Certain Accounting Matters.........................................................51
SECTION 11.3 Banking............................................................................52
SECTION 11.4 Withholding........................................................................52
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.........................................................................52
SECTION 12.2 Meetings of the Holders; Action by Written Consent.................................54
iii
5
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee.................................56
SECTION 13.2 Representations and Warranties of Delaware Trustee.................................56
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices............................................................................57
SECTION 14.2 Governing Law......................................................................58
SECTION 14.3 Intention of the Parties...........................................................59
SECTION 14.4 Headings...........................................................................59
SECTION 14.5 Successors and Assigns.............................................................59
SECTION 14.6 Partial Enforceability.............................................................59
SECTION 14.7 Counterparts.......................................................................59
TERMS OF
[___%] CAPITAL SECURITIES, SERIES A
[___%] COMMON SECURITIES, SERIES A.........................................................I-1
EXHIBIT A-1
FORM OF CAPITAL SECURITY CERTIFICATE.........................................................A1-1
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE..........................................................A2-1
iv
6
CROSS-REFERENCE TABLE*
Section of
Trust Indenture
Act of 1939, as Section of
amended Declaration
- --------------- -----------
310(a) ...................................................................... 5.3
310(b) ...................................................................... 5.3(c), 5.3(d)
311(a) ...................................................................... 2.2(b)
311(b) ...................................................................... 2.2(b)
312(a) ...................................................................... 2.2(a)
312(b) ...................................................................... 2.2(b)
313 ...................................................................... 2.3
314(a) ...................................................................... 2.4; 3.6(j)
314(c) ...................................................................... 2.5
315(a) ...................................................................... 3.9
315(b) ...................................................................... 2.7(a)
315(c) ...................................................................... 3.9(a)
315(d) ...................................................................... 3.9(b)
316(a) ...................................................................... 2.6
316(c) ...................................................................... 3.6(e)
317(a) ...................................................................... 3.8(e); 3.8(h)
317(b) ...................................................................... 3.8(i); 7.5
318 ...................................................................... 2.1
- ------------------
* This Cross-Reference Table does not constitute part of this
Declaration and shall not affect the interpretation of any of its
terms or provisions.
v
7
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
HAMILTON CAPITAL TRUST I
Dated as of December [__], 1998
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated and effective as of December [__], 1998, by and among the Trustees (as
defined herein), the Sponsor (as defined herein) and the Holders (as defined
herein), from time to time, of undivided beneficial interests in the assets of
the Trust to be issued pursuant to this Declaration;
WHEREAS, the Trustees and the Sponsor established Hamilton
Capital Trust I (the "Trust"), a trust created under the Delaware Business
Trust Act pursuant to a Declaration dated as of December [__], 1998 (the
"Original Declaration"), and a Certificate of Trust filed with the Secretary of
State of the State of Delaware on December [__], 1998, for the sole purpose of
issuing and selling certain securities representing undivided beneficial
interests in the assets of the Trust, investing the proceeds thereof solely in
certain Series A Debentures of the Debenture Issuer (each as hereinafter
defined) with no power to vary that investment, and engaging in only those
activities necessary, advisable or incidental thereto; and
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the
Original Declaration; and
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, ratify the actions of each Trustee taken prior to the date hereof;
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 declare that all assets contributed to the Trust will be held in
trust for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration and, in consideration
of the mutual covenants contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties,
intending to be legally bound hereby, agree as follows:
8
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) capitalized terms used in this Declaration but not
defined in the preamble above or elsewhere herein have the respective meanings
assigned to them in this Section 1.1;
(b) a term defined anywhere in this Declaration has the
same meaning throughout;
(c) all references to "the Declaration" or "this
Declaration" are to this Declaration and each Annex and Exhibit hereto, as
modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and
Sections and Annexes and Exhibits are to Articles and Sections of and Annexes
and Exhibits to this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the
same meaning when used in this Declaration unless otherwise defined in this
Declaration or unless the context otherwise requires;
(f) a term defined in the Indenture (as defined herein)
has the same meaning when used in this Declaration unless otherwise defined in
this Declaration or the context otherwise requires; and
(g) a reference to the singular includes the plural and
vice versa.
"Administrative Trustee" has the meaning set forth in
Section 5.1.
"Affiliate" has the same meaning as given to that term in
Rule 405 under the Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent, Registrar or Exchange
Agent.
"Authorized Officer" of a Person means any other Person
that is authorized to legally bind such former Person.
"Book-Entry Interest" means a beneficial interest in the
Global Capital Security registered in the name of a Clearing Agency or its
nominee, ownership and transfers of which shall be maintained and made through
book entries by a Clearing Agency as described in Section 9.4.
2
9
"Business Day" means any day other than a Saturday or a
Sunday or a day on which banking institutions in Wilmington, Delaware, New York,
New York or Miami, Florida are authorized or required by law or executive order
to remain closed.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss. 3801 et seq., as it may be amended from time to
time, or any successor legislation.
"Capital Security Beneficial Owner" means, with respect to
a Book-Entry Interest, a Person who is the beneficial owner of such Book-Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of
a Person maintaining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).
"Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Series A Capital Securities and in whose name or in the name
of a nominee of that organization shall be registered a global certificate and
which shall undertake to effect book entry transfers and pledges of the Series
A Capital Securities.
"Clearing Agency Participant" means a broker, dealer,
bank, other financial institution or other Person for whom from time to time
the Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.
"Closing Date" has the meaning specified in the
Underwriting Agreement.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation.
"Commission" means the United States Securities and
Exchange Commission as from time to time constituted, or if at any time after
the execution of this Declaration such Commission is not existing and
performing the duties now assigned to it under applicable federal securities
laws, then the body performing such duties at such time.
"Common Securities" has the meaning specified in
Section 7.1(a).
"Common Securities Guarantee" means the Common Securities
Guarantee Agreement, dated as of the Closing Date, entered into by Hamilton
Bancorp Inc., with respect to the Common Securities.
"Common Securities Subscription Agreement" means the
Common Securities Subscription Agreement, dated as of the Closing Date, between
the Trust and Hamilton Bancorp Inc. relating to the Common Securities.
"Common Security Certificate" means a certificate
evidencing ownership of Common Securities, substantially in the form attached
as Exhibit A-2.
3
10
"Company Indemnified Person" means (a) any Administrative
Trustee; (b) any Affiliate of any Administrative Trustee; (c) any officers,
directors, shareholders, members, partners, employees, representatives or
agents of any Administrative Trustee; or (d) any officer, employee or agent of
the Trust or its Affiliates.
"Corporate Trust Office" means the office of the Property
Trustee at which the corporate trust business of the Property Trustee shall, at
any particular time, be principally administered, which office at the date of
execution of this Declaration is located at Rodney Square North, 1100 North
Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust
Administration.
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or agent of (i) the
Trust or (ii) the Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means Hamilton Bancorp Inc., a Florida
corporation, or any successor entity resulting from any consolidation,
amalgamation, merger or other business combination, in its capacity as issuer
of the Series A Debentures under the Indenture.
"Debenture Subscription Agreement" means the Debenture
Subscription Agreement, dated as of the Closing Date, between the Debenture
Issuer and the Trust in respect of the Series A Debentures.
"Debenture Trustee" means Wilmington Trust Company, a
Delaware banking corporation, as trustee under the Indenture until a successor
is appointed thereunder, and thereafter means such successor trustee.
"Default" means an event, act or condition that with
notice or lapse of time, or both, would constitute an Event of Default.
"Definitive Capital Securities" has the meaning set forth
in Section 7.3(c).
"Delaware Trustee" has the meaning set forth in
Section 5.1.
"Direct Action" has the meaning set forth in
Section 3.8(e).
"Distribution" means a distribution payable to Holders in
accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial
Clearing Agency.
"Event of Default" with respect to the Securities means an
Event of Default (as defined in the Indenture) that has occurred and is
continuing with respect to the Series A Debentures.
4
11
"Exchange Act" means the Securities Exchange Act of 1934,
as amended from time to time, or any successor legislation.
"Exchange Agent" has the meaning set forth in Section 7.5.
"Federal Reserve Board" means the Board of Governors of
the Federal Reserve System.
"Fiduciary Indemnified Person" has the meaning set forth
in Section 10.4(b).
"Firm Securities Closing Date" has the meaning specified
in the Underwriting Agreement.
"Fiscal Year" has the meaning set forth in Section 11.1.
"Global Capital Security" means the Series A Capital
Security Certificate issued to the Clearing Agency at Closing.
"Holder" means a Person in whose name a Security or
Successor Security is registered, such Person being a beneficial owner within
the meaning of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or
a Fiduciary Indemnified Person.
"Indenture" means the Indenture, dated as of the Closing
Date, between the Debenture Issuer and the Debenture Trustee, as amended from
time to time.
"Initial Optional Redemption Date" has the meaning set
forth in Section 4(b) of Annex I hereto.
"Investment Company" means an investment company as
defined in the Investment Company Act.
"Investment Company Act" means the Investment Company Act
of 1940, as amended from time to time, or any successor legislation.
"Investment Company Event" has the meaning set forth in
Section 4(c) of Annex I hereto.
"Legal Action" has the meaning set forth in
Section 3.6(g).
"Like Amount" has the meaning set forth in Section 3 of
Annex I hereto.
"List of Holders" has the meaning set forth in
Section 2.2(a).
5
12
"Majority in Liquidation Amount" means, with respect to
the Trust Securities, except as provided in the terms of the Series A Capital
Securities or by the Trust Indenture Act, Holders of outstanding Trust
Securities voting together as a single class or, as the context may require,
Holders of outstanding Series A Capital 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 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 of the relevant class.
"Officers' Certificate" means, with respect to any Person,
a certificate signed by the Chairman, the Chief Executive Officer, the
President, an Executive or Senior Vice President, a Vice President, the Chief
Financial Officer, and the Secretary or an Assistant Secretary. Any Officers'
Certificate delivered by the Trust shall be signed by at least one
Administrative Trustee. Any Officers' Certificate delivered with respect to
compliance with a condition or covenant provided for in this Declaration shall
include:
(a) a statement that each officer signing the Certificate
has read the covenants or conditions and the definitions relating
thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Certificate;
(c) 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
(d) a statement as to whether or not, in the opinion of
each such officer, such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel,
who may be an employee of the Sponsor, and who shall be acceptable to the
Property Trustee.
"Option Securities Closing Date" has the meaning specified
in the Underwriting Agreement.
"Participants" has the meaning specified in
Section 7.3(b).
"Paying Agent" has the meaning specified in Section 7.4.
"Payment Amount" has the meaning specified in Section 6.1.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust,
6
13
unincorporated association, or government or any agency or political
subdivision thereof, or any other entity of whatever nature.
"PORTAL" has the meaning set forth in Section 3.6(b)
(iii).
"Property Trustee" has the meaning set forth in
Section 5.3(a).
"Property Trustee Account" has the meaning set forth in
Section 3.8(c)(i).
"Quorum" means a majority of the Administrative Trustees
or, if there are only two Administrative Trustees, both of them.
"Redemption Price" has the meaning set forth in
Section 4(a) of Annex I hereto.
"Registrar" has the meaning set forth in Section 7.4.
"Registration Statement" has the meaning set forth in
Section 3.6(b).
"Regulatory Capital Event" has the meaning set forth in
Section 4(c) of Annex I hereto.
"Related Party" means, with respect to the Sponsor, any
direct or indirect wholly owned subsidiary of the Sponsor or any other Person
that owns, directly or indirectly, 100% of the outstanding voting securities of
the Sponsor.
"Responsible Officer" means any officer within the
Corporate Trust Office of the Property Trustee with direct responsibility for
the administration of this Declaration and also means, with respect to a
particular corporate trust matter, any other officer of the Property Trustee to
whom such matter is referred because of that officer's knowledge of and
familiarity with the particular subject.
"Rule 3a-5" means Rule 3a-5 under the Investment Company
Act, or any successor rule or regulation.
"Securities" or "Trust Securities" means the Common
Securities and the Series A Capital Securities.
"Securities Act" means the Securities Act of 1933, as
amended from time to time, or any successor legislation.
"Securities Guarantees" means the Common Securities
Guarantee and the Series A Capital Securities Guarantee.
"Series A Capital Securities" has the meaning specified in
Section 7.1(a).
7
14
"Series A Capital Securities Guarantee" means the Series A
Capital Securities Guarantee Agreement, dated as of the Closing Date, by
Hamilton Bancorp Inc. in respect of the Series A Capital Securities.
"Series A Capital Security Certificate" means a
certificate evidencing ownership of Series A Capital Securities, substantially
in the form attached as Exhibit A-1.
"Series A Debentures" means the [___]% Junior Subordinated
Deferrable Interest Debentures due December [__], 2028, Series A, of the
Debenture Issuer issued pursuant to the Indenture.
"Special Event" has the meaning set forth in Section 4(c)
of Annex I hereto.
"Sponsor" means Hamilton Bancorp Inc., a Florida
corporation, or any successor entity resulting from any merger, consolidation,
amalgamation or other business combination, in its capacity as sponsor of the
Trust.
"Successor Delaware Trustee" has the meaning set forth in
Section 5.6(b)(ii).
"Successor Entity" has the meaning set forth in
Section 3.15(b)(i).
"Successor Property Trustee" has the meaning set forth in
Section 3.8(f)(ii).
"Successor Securities" has the meaning set forth in
Section 3.15(b)(i).
"Super Majority" has the meaning set forth in
Section 2.6(a) (ii).
"Tax Event" has the meaning set forth in Section 4(c) of
Annex I hereto.
"10% in Liquidation Amount" means, with respect to the
Trust Securities, except as provided in the terms of the Series A Capital
Securities or by the Trust Indenture Act, Holders of outstanding Trust
Securities voting together as a single class or, as the context may require,
Holders of outstanding Series A Capital 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 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 of the relevant class.
"Treasury Regulations" means the income tax regulations,
including temporary and proposed regulations, promulgated under the Code by the
United States Treasury Department, as such regulations may be amended from time
to time (including corresponding provisions of succeeding regulations).
"Trust Indenture Act" means the Trust Indenture Act of
1939, as amended from time to time, or any successor legislation.
8
15
"Trust Property" means (a) the Series A Debentures, (b)
any cash on deposit in or owing to the Property Trustee Account and (c) all
proceeds and rights in respect of the foregoing and any other property and
assets for the time being held or deemed to be held by the Property Trustee
pursuant to this Declaration.
"Trust Security Certificate" means any one of the Common
Security Certificates or the Series A Capital Security Certificates.
"Trustee" or "Trustees" means each Person who has signed
this Declaration as a trustee, so long as such Person shall continue as a
trustee of the Trust in accordance with the terms hereof, and all other Persons
who may from time to time be duly appointed, qualified and serving as Trustees
in accordance with the provisions hereof, and references herein to a Trustee or
the Trustees shall refer to such Person or Persons solely in their capacity as
trustees hereunder.
"Underwriting Agreement" means the Underwriting Agreement,
dated December [__], 1998, by and among the Trust, the Debenture Issuer and the
Underwriters named therein, relating to the Series A Capital Securities.
ARTICLE II
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 in order
for this Declaration to be qualified under the Trust Indenture Act and shall,
to the extent applicable, 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 limits, qualifies or conflicts with the duties imposed by ss.ss.
310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
(d) The application of the Trust Indenture Act to this
Declaration shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Administrative Trustees
on behalf of the Trust shall provide the Property Trustee, unless the Property
Trustee is Registrar for the Securities, (i) by the Business Day prior to the
payment date for Distributions, a list, in such form as the Property Trustee
may reasonably require, of the names and addresses of the Holders ("List of
Holders") as of such record date, provided that, neither the Sponsor nor the
Administrative Trustees on behalf of
9
16
the Trust shall be obligated to provide such List of Holders at any time that
the List of Holders does not differ from the most recent List of Holders given
to the Property Trustee by the Sponsor and the Administrative Trustees on
behalf of the Trust, and (ii) at any other time, within 30 days of receipt by
the Trust of a written request for a List of Holders as of a date no more than
14 days before such List of Holders is given to the Property Trustee. The
Property Trustee shall preserve, in as current a form as is reasonably
practicable, all information contained in Lists of Holders given to it or which
it receives in the capacity as Paying Agent (if acting in such capacity),
provided that the Property Trustee may destroy any List of Holders previously
given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its
obligations under ss.ss. 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after the date hereof, and no later than
the anniversary date hereof in each succeeding year, the Property Trustee shall
provide to the Holders of the Series A Capital Securities such reports as are
required by ss. 313 of the Trust Indenture Act, if any, in the form and in the
manner provided by ss. 313 of the Trust Indenture Act. The Property Trustee
shall also comply with the requirements of ss. 313(d) of the Trust Indenture
Act.
SECTION 2.4 Periodic Reports.
Each of the Sponsor and the Administrative Trustees on
behalf of the Trust shall provide to the Property Trustee, the Commission and
the Holders, such documents, reports and information as are required by ss. 314
(if any) of the Trust Indenture Act and the compliance certificate required by
ss. 314 of the Trust Indenture Act in the form, in the manner and at the times
required by ss. 314 of the Trust Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Administrative Trustees on
behalf of the Trust shall provide to the Property Trustee such evidence of
compliance with any conditions precedent provided for in this Declaration that
relate to any of the matters set forth in ss. 314(c) of the Trust Indenture
Act. Any certificate or opinion required to be given by an officer pursuant to
ss. 314(c)(1) of the Trust Indenture Act may be given in the form of an
Officers' Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in Liquidation Amount of
Series A Capital Securities may, by vote, on behalf of the Holders of all of
the Series A Capital Securities, waive any past Event of Default in respect of
the Series A Capital Securities and its consequences, provided that, if the
underlying Event of Default under the Indenture:
(i) is not waivable under the Indenture, the Event
of Default under the Declaration shall also not be
waivable; or
10
17
(ii) requires the consent or vote of greater than
a majority in aggregate principal amount of the holders
of the Series A Debentures (a "Super Majority") to be
waived under the Indenture, the Event of Default under
the Declaration may only be waived by the vote of the
Holders of at least the proportion in aggregate
liquidation amount of the Series A Capital Securities
that the relevant Super Majority represents of the
aggregate principal amount of the Series A Debentures
outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of ss.
316(a)(1)(B) of the Trust Indenture Act, and such ss. 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. Upon such waiver, any such
Event of Default shall cease to exist, and any Event of Default with respect to
the Series A Capital Securities arising therefrom shall be deemed to have been
cured, for every purpose of this Declaration, but no such waiver shall extend
to any subsequent or other Default or an Event of Default with respect to the
Series A Capital Securities or impair any right consequent thereon. Any waiver
by the Holders of the Series A Capital Securities of an Event of Default with
respect to the Series A Capital Securities shall also be deemed to constitute a
waiver by the Holders of the Common Securities of any such Event of Default
with respect to the Common Securities for all purposes of this 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, by vote, on behalf of the Holders of all of the
Common Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, except
where the Holders of the Common Securities are deemed to
have waived such Event of Default under the Declaration
as provided below in this Section 2.6(b), the Event of
Default under the Declaration shall also not be waivable;
or
(ii) requires the consent or vote of a Super
Majority to be waived, except where the Holders of the
Common Securities are deemed to have waived such Event of
Default under the Declaration as provided below in this
Section 2.6(b), the Event of Default under the
Declaration may only be waived by the vote of the Holders
of at least the proportion in aggregate liquidation
amount of the Common Securities that the relevant Super
Majority represents of the aggregate principal amount of
the Series A Debentures outstanding;
provided further, each Holder of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with respect to the
Common Securities and their consequences if all Events of Default with respect
to the Series A Capital Securities have been cured, waived or otherwise
eliminated, and until such Events of Default have been so cured, waived or
otherwise eliminated, the Property Trustee will be deemed to be acting solely
on behalf of the Holders of the
11
18
Series A Capital Securities, and only the Holders of the Series A Capital
Securities will have the right to direct the Property Trustee in accordance
with the terms of the Securities. The foregoing provisions of this Section
2.6(b) shall be in lieu of ss.ss. 316(a)(1)(A) and 316(a)(1)(B) of the Trust
Indenture Act, and such ss.ss. 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 waiver, any such Default shall
cease to exist and any Event of Default with respect to the Common Securities
arising therefrom shall be deemed to have been cured for every purpose of this
Declaration, but no such waiver shall extend to any subsequent or other Default
or Event of Default with respect to the Common Securities or impair any right
consequent thereon.
(c) A waiver of an Event of Default under the Indenture
by the Property Trustee, at the direction of the Holders of the Series A
Capital Securities, constitutes a waiver of the corresponding Event of Default
under this Declaration. The foregoing provisions of this Section 2.6(c) shall
be in lieu of ss. 316(a)(1)(B) of the Trust Indenture Act, and such ss.
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 Default; Notice.
(a) The Property Trustee shall, within 90 days after a
Responsible Officer obtains actual knowledge of the occurrence of a Default
with respect to the Securities, transmit by mail, first class postage prepaid,
to the Holders, notices of all such Defaults, unless such Defaults have been
cured before the giving of such notice or previously waived; provided, however,
that except in the case of a Default arising from the nonpayment of principal
of or interest (including Compounded Interest and Additional Sums (as such
terms are defined in the Indenture), if any) on any of the Series A Debentures,
the Property Trustee shall be protected in withholding such notice if and so
long as a Responsible Officer in good faith determines that the withholding of
such notice is in the interests of the Holders.
(b) The Property Trustee shall not be deemed to have
knowledge of any Default or Event of Default except:
(i) a Default or Event of Default under Sections
5.01(a) (other than the payment of Compounded Interest
and Additional Sums) and 5.01(b) of the Indenture; or
(ii) any Default or Event of Default as to which
the Property Trustee shall have received written notice
or of which a Responsible Officer charged with the
administration of the Declaration shall have actual
knowledge.
(c) Within ten Business Days after a Responsible Officer
obtains actual knowledge of the occurrence of any Event of Default, the
Property Trustee shall transmit notice of such Event of Default to the Holders
of the Series A Capital Securities, the Administrative Trustees and the
Sponsor, unless such Event of Default shall have been cured or waived. The
Sponsor and
12
19
the Administrative Trustees shall file annually with the Property Trustee a
certification as to whether or not they are in compliance with all the
conditions and covenants applicable to them under this Declaration.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named Hamilton Capital Trust I as such name
may be modified from time to time by the Administrative Trustees following
written notice to the Delaware Trustee, the Property Trustee and the Holders.
The Trust's activities may be conducted under the name of the Trust or any
other name deemed advisable by the Administrative Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o
Hamilton Bancorp Inc., 3750 N.W. 87th Avenue, Miami, Florida 33178. On ten
Business Days' prior written notice to the Delaware Trustee, the Property
Trustee and the Holders of Securities, the Administrative 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) use the proceeds from the sale of the
Securities to acquire the Series A Debentures, and (c) except as otherwise
limited herein, to engage in only those other activities necessary, advisable
or incidental thereto, including without limitation, those activities specified
in Sections 3.6, 3.8, 3.9, 3.10, 3.11 and/or 3.12. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investments, mortgage or
pledge any of its assets, or otherwise undertake (or permit to be undertaken)
any activity that would cause the Trust not to be classified for United States
federal income tax purposes as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration
and to the specific duties of the Property Trustee, the Administrative Trustees
shall have exclusive and complete authority to carry out the purposes of the
Trust. An action taken by one or more of the Administrative Trustees in
accordance with their powers shall constitute the act of and serve to bind the
Trust and an action taken by the Property Trustee on behalf of the Trust in
accordance with its powers shall constitute the act of and serve to bind the
Trust. In dealing with the Trustees acting on behalf of the Trust, no Person
shall be required to inquire into the authority of the Trustees to bind the
Trust. Persons dealing with the Trust are entitled to rely conclusively on the
power and authority of the Trustees as set forth in this Declaration.
13
20
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the
Series A Debentures and the Property Trustee Account or as otherwise provided
in this Declaration, legal title to all assets of the Trust shall be vested in
the Trust. The Holders shall not have legal title to any part of the assets of
the Trust, but shall have an undivided beneficial interest in the assets of the
Trust.
SECTION 3.6 Powers and Duties of the Administrative Trustees.
The Administrative Trustees acting individually or
together shall have the power, duty and authority, and are hereby authorized and
directed, to cause the Trust to engage in the following activities:
(a) to execute, enter into and deliver the Common
Securities Subscription Agreement and to execute, deliver, issue and sell the
Securities in accordance with this Declaration; provided, however, that (i) the
Trust may issue no more than one series of Series A Capital Securities and no
more than one series of Common Securities, (ii) there shall be no interests in
the Trust other than the Securities, and (iii) the issuance of Securities shall
be limited to a simultaneous issuance of both Series A Capital Securities and
Common Securities on each Closing Date;
(b) in connection with the issue and sale of the Series A
Capital Securities at the direction of the Sponsor, to:
(i) prepare and execute, if necessary, one or more
registration statements including a prospectus and
prospectus supplements and any amendment thereto, in
preliminary and final form, relating to the offering and
sale of the Series A Capital Securities of the Trust
under the Securities Act, and such forms or filings as
may be required under the Securities Act, the Exchange
Act or the Trust Indenture Act (each a "Registration
Statement") prepared by the Sponsor;
(ii) execute and file any documents prepared by
the Sponsor, or take any acts as determined by the
Sponsor to be necessary in order to qualify or register
all or part of the Series A Capital Securities in any
State in which the Sponsor has determined to qualify or
register such Series A Capital Securities for sale;
(iii) execute and file an application, prepared by
the Sponsor, to permit the Series A Capital Securities to
trade or be quoted or listed in or on the Private
Offerings, Resales and Trading through Automated Linkages
("PORTAL") Market or any other securities exchange,
quotation system or the Nasdaq Stock Market's National
Market; and
(iv) execute and deliver the letters, documents,
or instruments with DTC and other Clearing Agencies
relating to the Series A Capital Securities, and if
required, execute and file with the Commission a
registration statement on Form 8-A, including any
amendments thereto, prepared by the Sponsor, relating to
the
14
21
registration of the Capital Securities under Section
12(b) or 12(g) of the Exchange Act, as the case may be.
(c) to execute, enter into and deliver the Debenture
Subscription Agreement and to acquire the Series A Debentures with the proceeds
of the sale of the Series A Capital Securities and the Common Securities;
provided, however, that the Administrative Trustees shall cause legal title to
the Series A Debentures to be held of record in the name of the Property
Trustee for the benefit of the Holders;
(d) to give the Sponsor and the Property Trustee prompt
written notice of the occurrence of a Special Event;
(e) 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 ss. 316(c) of the Trust
Indenture Act, Distributions, voting rights, redemptions and exchanges, and to
issue relevant notices to the Holders with respect to such actions and
applicable record dates;
(f) to take all actions and perform such duties as may be
required of the Administrative Trustees pursuant to the terms of the
Securities;
(g) to the fullest extent permitted by law, 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;
(h) to employ or otherwise engage employees, agents (who
may be designated as officers with titles), managers, contractors, advisors and
consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's
obligations under the Trust Indenture Act;
(j) to give the certificate required by ss. 314(a)(4) of
the Trust Indenture Act to the Property Trustee, which certificate may be
executed by any Administrative Trustee;
(k) to incur expenses that are necessary or incidental to
carry out any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as,
Registrar and Exchange Agent for the Securities or to appoint a Paying Agent
for the Securities as provided in Section 7.5 except for such time as such
power to appoint a Paying Agent is vested in the Property Trustee;
(m) to give prompt written notice to the Property Trustee
and to the Holders of any notice received from the Debenture Issuer of its
election to defer payments of interest on the Series A Debentures by extending
the interest payment period under the Indenture;
15
22
(n) to take all action that may be necessary or
appropriate for the preservation and the continuation of the Trust's valid
existence, rights, franchises and privileges as a statutory 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 or
to enable the Trust to effect the purposes for which the Trust was created;
(o) to take any action, not inconsistent with this
Declaration or with applicable law, that the Administrative Trustees determine
in their discretion to be necessary or desirable in carrying out the activities
of the Trust as set out in this Section 3.6, including, but not limited to:
(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 continue not to be
classified as an association taxable as a corporation or
causing the Trust to be classified as a grantor trust, in
each case for United States federal income tax purposes;
and
(iii) cooperating with the Debenture Issuer to ensure
that the Series A Debentures will be treated as
indebtedness of the Debenture Issuer for United States
federal income tax purposes;
(p) to take all action necessary to cause all applicable
tax returns and tax information reports that are required to be filed with
respect to the Trust to be duly prepared and filed by the Administrative
Trustees, on behalf of the Trust; and
(q) to execute and deliver all documents or instruments,
perform all duties and powers, and do all things for and on behalf of the Trust
in all matters necessary, advisable or incidental to the foregoing.
The Administrative Trustees must exercise the powers set
forth in this Section 3.6 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Administrative Trustees
shall not take any action that is inconsistent with the purposes and functions
of the Trust set forth in Section 3.3.
Subject to this Section 3.6, the Administrative Trustees
shall have none of the powers or the authority of the Property Trustee set
forth in Section 3.8.
Any expenses incurred by the Administrative Trustees
pursuant to this Section 3.6 shall be reimbursed by the Debenture Issuer.
16
23
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.
The Trust shall not, and the Trustees (including the
Property Trustee and the Delaware Trustee) shall not, and the Administrative
Trustees shall cause the Trust not to, engage in any activity other than as
required or authorized by this Declaration. Notwithstanding any provision in
this Declaration to the contrary, the Trust shall not:
(i) invest any proceeds received by the Trust from
holding the Series A Debentures, but shall distribute all
such proceeds to Holders pursuant to the terms of this
Declaration and of the Securities;
(ii) acquire any assets other than as expressly
provided herein;
(iii) possess Trust Property for other than a Trust
purpose or execute any mortgage in respect of, or pledge,
any Trust Property;
(iv) make any loans or incur any indebtedness
other than loans represented by the Series A Debentures;
(v) possess any power or otherwise act in such a
way as to vary the Trust Property or the terms of the
Securities in any way whatsoever;
(vi) issue any securities or other evidences of
beneficial ownership of, or beneficial interest in, the
Trust other than the Securities;
(vii) other than as provided in this Declaration
or Annex I hereto, (A) direct the time, method and place
of conducting any proceeding with respect to any remedy
available to the Debenture Trustee, or exercising any
trust or power conferred upon the Debenture Trustee with
respect to the Series A Debentures, (B) waive any past
default that is waivable under the Indenture, or (C)
exercise any right to rescind or annul any declaration
that the principal of all the Series A Debentures shall
be due and payable; or
(viii)consent to any amendment, modification or
termination of the Indenture or the Series A Debentures
where such consent shall be required unless the Trust
shall have received an opinion of independent tax counsel
experienced in such matters to the effect that such
amendment, modification or termination 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.
SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Series A 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. The right, title and interest of the
Property Trustee to the Series A Debentures shall vest automatically
17
24
in each Person who may hereafter be appointed as Property Trustee in accordance
with Section 5.6. Such vesting and cessation of title shall be effective
whether or not conveyancing documents with regard to the Series A Debentures
have been executed and delivered.
(b) The Property Trustee shall not transfer its right,
title and interest in the Series A Debentures to the Administrative Trustees or
to the Delaware Trustee (if the Property Trustee does not also act as Delaware
Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated
non-interest bearing trust account (the "Property Trustee
Account") in the name of and under the exclusive control
of the Property Trustee on behalf of the Holders and,
upon the receipt of payments of funds made in respect of
the Series A Debentures held by the Property Trustee,
deposit such funds into the Property Trustee Account and
make payments or cause the Paying Agent to make payments
to the Holders from the Property Trustee Account in
accordance with Section 6.1; funds in the Property
Trustee Account shall be held uninvested until disbursed
in accordance with this Declaration; and the Property
Trustee Account shall be an account that is maintained
with a banking institution the rating on whose long-term
unsecured indebtedness by a "nationally recognized
statistical rating organization," as that term is defined
for purposes of Rule 436(g)(2) under the Securities Act,
is at least equal to the rating assigned to the Series A
Capital Securities;
(ii) engage in such ministerial activities as
shall be necessary or appropriate to effect the
redemption of the Securities to the extent the Series A
Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued
by the Administrative Trustees in accordance with the
terms of the Securities, engage in such ministerial
activities as shall be necessary or appropriate to effect
the distribution of the Series A Debentures to Holders
upon the occurrence of certain events.
(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) Subject to Section 3.9(a), the Property Trustee shall
take any Legal Action which arises out of or in connection with an Event of
Default of which a Responsible Officer has actual knowledge or the Property
Trustee's duties and obligations under this Declaration or the Trust Indenture
Act may so require; and if the Property Trustee shall have failed to take such
Legal Action following a written request from the Holders, the Holders of the
Series A Capital Securities may, to the fullest extent permitted by law, take
such Legal Action, to the same extent as if such Holders of Series A Capital
Securities held an aggregate principal amount of Series A Debentures equal to
the aggregate liquidation amount of such Series A Capital Securities, without
first proceeding against
18
25
the Property Trustee or the Trust; provided, however, that if an Event of
Default has occurred and is continuing and such event is attributable to the
failure of the Debenture Issuer to pay the principal of or interest (including
Compounded Interest and Additional Sums, if any) on the Series A Debentures on
the date such principal, or interest (including Compounded Interest and
Additional Sums, if any) is otherwise payable (or in the case of redemption, on
the redemption date), then a Holder of Series A Capital Securities may directly
institute a proceeding for enforcement of payment to such Holder of the
principal of or interest (including Compounded Interest and Additional Sums, if
any) on the Series A Debentures having a principal amount equal to the
aggregate liquidation amount of the Series A Capital Securities of such Holder
(a "Direct Action") on or after the respective due date specified in the Series
A Debentures. In connection with such Direct Action, the Holders of the Common
Securities will be subrogated to the rights of such Holder of Series A Capital
Securities to the extent of any payment made by the Debenture Issuer to such
Holder of Series A Capital Securities in such Direct Action. Except as provided
in the preceding sentences, the Holders of Series A Capital Securities will not
be able to exercise directly any other remedy available to the holders of the
Series A Debentures.
(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 distributed to the
Holders pursuant to the terms of the Securities and this
Declaration; or
(ii) a successor Property Trustee has been
appointed and has accepted that appointment in accordance
with Section 5.6 (a "Successor Property Trustee").
(g) The Property Trustee shall have the legal power to
exercise all of the rights, powers and privileges of a holder of Series A
Debentures under the Indenture, and, if an Event of Default actually known to a
Responsible Officer (other than in the case of Events of Default under Sections
5.01(a) and 5.01(b) of the Indenture) occurs and is continuing, the Property
Trustee shall, for the benefit of Holders, enforce its rights as holder of the
Series A Debentures subject to the rights of the Holders pursuant to the terms
of this Declaration and the Securities.
(h) The Property Trustee shall be authorized to undertake
any actions set forth in ss. 317(a) of the Trust Indenture Act.
(i) For such time as the Property Trustee is the Paying
Agent, the Property Trustee may authorize one or more Persons to act as
additional Paying Agents and to 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 ss. 317(b) of the Trust Indenture Act.
Any such additional Paying Agent may be removed by the Property Trustee at any
time the Property Trustee remains as Paying Agent, and a successor Paying Agent
or additional Paying Agents may be (but are not required to be) appointed at
any time by the Property Trustee while the Property Trustee is acting as Paying
Agent.
19
26
(j) Subject to this Section 3.8, the Property Trustee
shall have none of the duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 3.6.
Notwithstanding anything expressed or implied to the
contrary in this Declaration or any Annex or Exhibit hereto, (i) the Property
Trustee must exercise the powers set forth in this Section 3.8 in a manner that
is consistent with the purposes and functions of the Trust set out in Section
3.3, and (ii) the Property Trustee shall not take any action that is
inconsistent with the purposes and functions of the Trust set out in Section
3.3.
SECTION 3.9 Certain Duties and Responsibilities of the
Property Trustee.
(a) The Property Trustee, before the occurrence of any
Event of Default (of which, other than in the case of Events of Default under
Sections 5.01(a) and 5.01(b) of the Indenture, a Responsible Officer of the
Property Trustee has actual knowledge) and after the curing or waiving of all
such Events of Default that may have occurred, shall undertake to perform only
such duties as are specifically set forth in this Declaration and in the
Securities, and no implied covenants shall be read into this Declaration
against the Property Trustee. In case an Event of Default has occurred (that
has not been cured or waived pursuant to Section 2.6) of which a Responsible
Officer has actual knowledge (other than in the case of Events of Default under
Sections 5.01(a) and 5.01(b) of the Indenture), the Property Trustee shall
exercise such of the rights and powers vested in it by this Declaration, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) No provision of this Declaration shall be construed
to relieve the Property Trustee from liability for its own negligent action,
its own negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default
(of which, other than in the case of Events of Default under
Sections 5.01(a) and 5.01(b) of the Indenture, a Responsible
Officer of the Property Trustee has actual knowledge) and
after the curing or waiving of all such Events of Default that
may have occurred:
(A) the duties and obligations of the Property Trustee
shall be determined solely by the express provisions of
this Declaration and in the Securities, 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 in the Securities, and no implied
covenants or obligations shall be read into this
Declaration against the Property Trustee; and
(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively
rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Property Trustee
and conforming to the
20
27
requirements of this Declaration; provided, however, that
in the case of any such certificates or opinions that by
any provision hereof are specifically required to be
furnished to the Property Trustee, the Property Trustee
shall be under a duty to examine the same to determine
whether or not on their face 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,
unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in
good faith in accordance with the direction of the Holders of
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;
(v) the Property Trustee's sole duty with respect to
the custody, safekeeping and physical preservation of the
Series A Debentures and the Property Trustee 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 Series A 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 may
otherwise agree in writing with the Sponsor. Money held by the
Property Trustee need not be segregated from other funds held
by it except in relation to the Property Trustee Account
maintained by the Property Trustee pursuant to Section
3.8(c)(i) and except to the extent otherwise required by law;
and
(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or
the Sponsor with their respective duties under this
Declaration, nor shall the Property Trustee be liable for any
default or misconduct of the Administrative Trustees or the
Sponsor.
21
28
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 or the
Administrative Trustees contemplated by this Declaration
may 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, in the absence of bad faith on its part,
request and conclusively rely upon an Officers'
Certificate which, upon receipt of such request, shall be
promptly delivered by the Sponsor or the Administrative
Trustees;
(iv) the Property Trustee shall have no duty to see
to any recording, filing or registration of any instrument
(including any financing or continuation statement or any
filing under tax or securities laws) or any rerecording,
refiling or registration thereof;
(v) the Property Trustee may consult with counsel
or other experts of its selection, 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; and 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, unless such Holder shall have provided to the
Property Trustee security and indemnity, reasonably
satisfactory to the Property Trustee, against the costs,
expenses (including reasonable 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,
22
29
including such reasonable advances as may be requested by
the Property Trustee; provided, however, that, nothing
contained in this Section 3.10(a)(vi) shall be taken to
relieve the Property Trustee, upon the occurrence of an
Event of Default (of which, other than in the case of
Events of Default under Sections 5.01(a) and 5.01(b) of
the Indenture, a Responsible Officer of the Property
Trustee has actual knowledge), 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 may see
fit;
(viii) the Property Trustee may execute any of the
trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents,
custodians, nominees or attorneys, and the Property
Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed
with due care by it hereunder;
(ix) any authorized or required action taken by
the Property Trustee or its agents hereunder shall bind
the Trust and the Holders, 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 conclusively evidenced 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 (i) may request instructions from the
Holders, which instructions may only be given by the
Holders of the same proportion in liquidation amount of
the Securities as would be entitled to direct the
Property Trustee under the terms of the Securities in
respect of such remedy, right or action, (ii) may refrain
from enforcing such remedy or right or taking such other
action until such instructions are received, and (iii)
shall be protected in 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; and
23
30
(xii) the Property Trustee shall not be liable for
any action taken, suffered, or omitted to be taken by it
in good faith, without negligence or willful misconduct,
and reasonably believed by it to be authorized or within
the discretion or 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 5.2, the Delaware Trustee shall not be entitled to exercise
any powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Trustees described in this Declaration (except as
required under the Business Trust Act). Except as set forth in Section 5.2, the
Delaware Trustee shall be a Trustee for the sole and limited purpose of
fulfilling the requirements of ss. 3807 of the Business Trust Act. In the event
the Delaware Trustee shall at any time be required to take any action or
perform any duty hereunder, the Delaware Trustee shall be entitled to the
benefits of Section 3.9(b)(ii) to (viii), inclusive, and Section 3.10. No
implied covenants or obligations shall be read into this Declaration against
the Delaware Trustee.
SECTION 3.12 Execution of Documents.
Unless otherwise required by applicable law, each
Administrative Trustee, individually, is authorized to execute and deliver on
behalf of the Trust any documents, agreements, instruments or certificates that
the Administrative 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 Trust Property or any part
thereof. The Trustees make no representations as to the validity or sufficiency
of this Declaration or the Securities.
SECTION 3.14 Duration of Trust.
The Trust, unless dissolved pursuant to the provisions of
Article VIII hereof, shall have existence up to [_________ ___], 2053.
24
31
SECTION 3.15 Mergers.
(a) The Trust may not merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to any Person, except as
described in Section 3.15(b) and (c) and except with respect to the
distribution of Series A Debentures to Holders pursuant to Section 8.1(a)(iii)
of this Declaration or Section 3 of Annex I.
(b) The Trust may, at the request of the Sponsor, with
the consent of the Administrative Trustees or, if there are more than two, a
majority of the Administrative Trustees and without the consent of the Holders,
the Delaware Trustee or the Property Trustee, merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to, a trust organized as
such under the laws of any State; provided that:
(i) such successor entity (the "Successor Entity")
either:
(A) expressly assumes all of the obligations of the
Trust under the Securities; or
(B) substitutes for the Securities other
securities having substantially the same terms as
the Securities (the "Successor Securities") so long
as the Successor Securities rank the same as the
Securities rank in priority with respect to
Distributions and payments upon liquidation,
redemption and otherwise;
(ii) the Sponsor expressly appoints a trustee of
the Successor Entity that possesses the same powers and
duties as the Property Trustee with respect to the Series
A Debentures;
(iii) the Successor Securities (excluding any
securities substituted for the Common Securities) are
listed, quoted or included for trading, or any Successor
Securities will be listed, quoted or included for trading
upon notification of issuance, on any national securities
exchange or with any other organization on which the
Series A Capital Securities are then listed, quoted or
included;
(iv) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause
the Series A Capital Securities (including any Successor
Securities) or the Series A Debentures to be downgraded
by any nationally recognized statistical rating
organization that publishes a rating on the Series A
Capital Securities or the Series A Debentures;
(v) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges
of the Holders (including the holders of any Successor
Securities) in any material
25
32
respect (other than with respect to any dilution of the
interests of such Holders or holders, as the case may be,
in the Successor Entity);
(vi) the Successor Entity has a purpose
substantially identical to that of the Trust;
(vii) prior to such merger, consolidation,
amalgamation, 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 merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and
privileges of the Holders (including the holders of
any Successor Securities) in any material respect
(other than with respect to any dilution of the
interests of such Holders or holders, as the case
may be, in the Successor Entity);
(B) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or
lease, neither the Trust nor the Successor Entity
will be required to register as an Investment
Company; and
(C) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or
lease, the Trust (or the Successor Entity) will
continue not to be classified as an association
taxable as a corporation and will not be less likely
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 of the
Successor Entity and guarantees the obligations of the
Successor Entity under the Successor Securities at least
to the extent provided by the Securities Guarantees; and
(ix) there shall have been furnished to the
Property Trustee an Officers' Certificate and an Opinion
of Counsel, each to the effect that all conditions
precedent in this Declaration to such transaction have
been satisfied.
(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, amalgamate, merge with or into, or be replaced by,
or convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to, any other Person or permit any other Person to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer or lease
would cause the Trust or the Successor Entity not to be classified as a grantor
trust for United States federal income tax purposes.
26
33
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
On each Closing Date, pursuant to the Common Securities
Subscription Agreement, the Sponsor will purchase all of the Common Securities
then issued by the Trust, in an amount equal to at least 3% of the total
capital of the Trust, at the same time as the Series A Capital Securities are
issued and sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Series A
Capital Securities, the Sponsor shall have the exclusive right and
responsibility to engage in the following activities:
(a) to prepare and file with the Commission the
Registration Statements and any amendments thereto, and the prospectus to be
included therein, in preliminary and final form, and to prepare for filing by
the Trust with the Commission any other necessary documents, including any
amendments thereto;
(b) to determine the States in which to take appropriate
action to qualify or register for sale all or part of the Series A Capital
Securities and to do any and all such acts, other than actions which must be
taken by the Trust, and advise the Trust of actions it must take, and prepare
for execution and filing any documents to be executed and filed by the Trust,
as the Sponsor deems necessary or advisable in order to comply with the
applicable laws of any such States;
(c) if deemed necessary or advisable by the Sponsor, to
prepare for filing by the Trust an application to permit the Series A Capital
Securities to trade or be quoted or listed in or on the PORTAL market, or any
other securities exchange, quotation system or the Nasdaq Stock Market's
National Market to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A, including any amendments thereto, relating
to the registration of the Capital Securities under Section 12(b) or 12(g) of
the Exchange Act, as the case may be, including any amendments thereto; and to
negotiate the terms of, execute, enter into and deliver the Underwriting
Agreement.
SECTION 4.3 Right to Proceed.
The Sponsor acknowledges the rights of the Holders of
Series A Capital Securities, in the event that a failure of the Trust to pay
Distributions on the Series A Capital Securities is attributable to the failure
of the Debenture Issuer to pay the principal of or interest on the Series A
Debentures, to institute a proceeding directly against the Debenture Issuer for
enforcement of its payment obligations in respect of the Series A Debentures.
27
34
SECTION 4.4 Right to Dissolve Trust.
The Sponsor will have the right at any time to dissolve
the Trust and, after satisfaction of liabilities to creditors of the Trust as
required by applicable law, to cause the Series A Debentures to be distributed
to the Holders in liquidation of the Trust. Such right is subject to the
Sponsor's having received (i) an Opinion of Counsel to the effect that such
distribution will not cause the Holders of Series A Capital Securities to
recognize gain or loss for United States federal income tax purposes and (ii)
all required regulatory approvals.
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees; Appointment of Co-Trustee.
The number of Trustees initially shall be five (5), and:
(a) at any time before the issuance of any Securities,
the Sponsor may, by written instrument, increase or decrease the number of
Trustees; and
(b) after the issuance of any Securities, the number of
Trustees may be increased or decreased by vote of the Holders of a Majority in
Liquidation Amount of the Common Securities voting as a class at a meeting of
the Holders of the Common Securities;
provided, however, that, the number of Trustees shall in no event be less than
two (2); provided further that (1) one Trustee, in the case of a natural
person, shall be a person who is a resident of the State of Delaware or that,
if not a natural person, is an entity which has its principal place of business
in the State of Delaware (the "Delaware Trustee"); (2) there shall be at least
one Trustee who is an employee or officer of, or is affiliated with, the
Sponsor (an "Administrative Trustee"); and (3) one Trustee shall be the
Property Trustee for so long as this Declaration is required to qualify as an
indenture under the Trust Indenture Act, and such Trustee may also serve as
Delaware Trustee if it meets the applicable requirements. Notwithstanding the
above, unless an Event of Default shall have occurred and be continuing, at any
time or times, for the purpose of meeting the legal requirements of the Trust
Indenture Act or of any jurisdiction in which any part of the Trust Property
may at the time be located, the Holders of a Majority in Liquidation Amount of
the Common Securities acting as a class at a meeting of the Holders of the
Common Securities, and the Administrative Trustees shall have power to appoint
one or more Persons either to act as a co-trustee, jointly with the Property
Trustee, of all or any part of the Trust Property, or to act as separate
trustee of any such property, in either case with such powers as may be
provided in the instrument of appointment, and to vest in such Person or
Persons in such capacity any property, title, right or power deemed necessary
or desirable, subject to the provisions of this Declaration. In case an Event
of Default has occurred and is continuing, the Property Trustee alone shall
have power to make any such appointment of a co-trustee.
28
35
SECTION 5.2 Delaware Trustee.
For so long as required by the Business Trust Act, the
Delaware Trustee shall be:
(a) a natural person who is a resident of the State of
Delaware; or
(b) if not a natural person, an entity which has its
principal place of business in the State of Delaware, and otherwise meets the
requirements of applicable law,
provided, however, that, if the Property Trustee has its principal place of
business in the State of Delaware and otherwise meets the requirements of
applicable law, then the Property Trustee shall also be the Delaware Trustee
and Section 3.11 shall have no application.
The initial Delaware Trustee shall be:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attn.: Corporate Trust Administration
Telephone: (302) 651-1000
Telecopier: (302) 651-8882
SECTION 5.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee (the
"Property Trustee") which shall act as Property Trustee and which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any
State or Territory thereof or of the District of
Columbia, or a corporation or Person permitted by the
Commission to act as an indenture trustee under the Trust
Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and
surplus of at least fifty million U.S. dollars
($50,000,000), and subject to supervision or examination
by federal, state, territorial or District of Columbia
authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority
referred to above, then for the purposes of this Section
5.3(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital
and surplus as set forth in its most recent report of
condition so published.
29
36
(b) If at any time the Property Trustee shall cease to be
eligible to so act under Section 5.3(a), the Property Trustee shall immediately
resign in the manner and with the effect set forth in Section 5.6(c).
(c) If the Property Trustee has or shall acquire any
"conflicting interest" within the meaning of ss. 310(b) of the Trust Indenture
Act, the Property Trustee and the Holder of the Common Securities (as if it
were the obligor referred to in ss. 310(b) of the Trust Indenture Act) shall in
all respects comply with the provisions of ss. 310(b) of the Trust Indenture
Act.
(d) The Series A Capital Securities Guarantee shall be
deemed to be specifically described in this Declaration for purposes of clause
(i) of the first proviso contained in ss. 310(b) of the Trust Indenture Act.
(e) The initial Property Trustee shall be:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attn.: Corporate Trust Administration
Telephone: (302) 651-1000
Telecopier: (302) 651-8882
SECTION 5.4 Certain Qualifications of Administrative Trustees and
Delaware Trustee Generally.
Each Administrative Trustee and the Delaware Trustee
(unless the Property Trustee also acts as Delaware Trustee) shall be either a
natural person who is at least 21 years of age or a legal entity that shall act
through one or more Authorized Officers.
SECTION 5.5 Administrative Trustees.
The initial Administrative Trustees shall be:
John M.R. Jacobs
Marilyn Alvarado
Lynn Hernandez
c/o Hamilton Bancorp Inc.
3750 N.W. 87th Avenue
Miami, Florida 33178
Telephone: (305) 717-5620
Telecopier: (305) 717-5631
(a) Except as expressly set forth in this Declaration and
except if a meeting of the Administrative Trustees is called with respect to
any matter over which the Administrative
30
37
Trustees have power to act, any power of the Administrative Trustees may be
exercised by, or with the consent of, any one such Administrative Trustee.
SECTION 5.6 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 5.6(b) hereof and to Section 6(b)
of Annex I hereto, Trustees may be appointed or removed without cause at any
time:
(i) until the issuance of any Securities, by
written instrument executed by the Sponsor;
(ii) unless an Event of Default shall have occurred
and be continuing after the issuance of any Securities, by
vote of the Holders of a Majority in Liquidation Amount of
the Common Securities voting as a class at a meeting of
the Holders of the Common Securities; and
(iii) if an Event of Default shall have occurred
and be continuing after the issuance of the Securities,
with respect to the Property Trustee or the Delaware
Trustee, by vote of Holders of a Majority in Liquidation
Amount of the Series A Capital Securities voting as a
class at a meeting of Holders of the Series A Capital
Securities, and with respect to the Administrative
Trustees, in the manner set forth in Section 5.6(a)(ii)
hereof.
(b) (i) The Trustee that acts as Property Trustee shall
not be removed in accordance with Section 5.6(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
removed Property Trustee, the Administrative Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall
not be removed in accordance with Section 5.6(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections 5.2 and
5.4 (a "Successor Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Delaware Trustee
and delivered to the removed Delaware Trustee, the Property Trustee (if the
removed Delaware Trustee is not also the Property Trustee), the Administrative
Trustees and the Sponsor.
31
38
(c) A Trustee appointed to office shall hold office until
his successor shall have been appointed or until his death, removal or
resignation. Any Trustee may resign from office (without need for prior or
subsequent accounting) by an instrument in writing signed by the Trustee and
delivered to the other Trustees, the Sponsor and the Trust, which resignation
shall take effect upon such delivery or upon such later date as is specified
therein; provided, however, that:
(i) No such resignation of the Trustee that acts
as the Property Trustee shall be effective:
(A) until a Successor Property Trustee has been
appointed and has accepted such appointment by
instrument executed by such Successor Property
Trustee and delivered to the Trust, the Sponsor, the
Delaware Trustee (if the resigning Property Trustee
is not also the Delaware Trustee) 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; and
(ii) no such resignation of the Trustee that acts
as the Delaware Trustee shall be effective until a
Successor Delaware Trustee has been appointed and has
accepted such appointment by instrument executed by such
Successor Delaware Trustee and delivered to the Trust,
the Property Trustee (if the resigning Delaware Trustee
is not also the Property Trustee), the Sponsor and the
resigning Delaware Trustee.
(d) The Holders of the Common Securities or, if an Event
of Default shall have occurred and be continuing after the issuance of the
Securities, the Holders of the Series A Capital 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 5.6.
(e) If no Successor Property Trustee or Successor
Delaware Trustee shall have been appointed and accepted appointment as provided
in this Section 5.6 within 60 days after delivery of an instrument of
resignation or removal, the Property Trustee or Delaware Trustee resigning or
being removed, as applicable, may petition any court of competent jurisdiction
for appointment of a Successor Property Trustee or Successor Delaware Trustee.
Such court may thereupon, after prescribing such notice, if any, as it may deem
proper to prescribe, 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.
32
39
(g) At the time of resignation or removal of the Property
Trustee or the Delaware Trustee, the Sponsor shall pay to such Trustee any
amounts that may be owed to such Trustee pursuant to Section 10.4.
(h) Any successor Delaware Trustee shall file an
amendment to the Certificate of Trust with the Secretary of State of the State
of Delaware identifying the name and principal place of business of such
Successor Delaware Trustee in the State of Delaware.
SECTION 5.7 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 5.l, or if the number of
Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Administrative
Trustees or, if there are more than two, a majority of the Administrative
Trustees shall be conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance with Section
5.6.
SECTION 5.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to dissolve, liquidate or annul the Trust or to
terminate this Declaration. Whenever a vacancy in the number of Administrative
Trustees shall occur, until such vacancy is filled by the appointment of an
Administrative Trustee in accordance with Section 5.6, the Administrative
Trustees in office, regardless of their number, shall have all the powers
granted to the Administrative Trustees and shall discharge all the duties
imposed upon the Administrative Trustees by this Declaration.
SECTION 5.9 Meetings.
If there is more than one Administrative Trustee, meetings
of the Administrative Trustees shall be held from time to time upon the call of
any Administrative Trustee. Regular meetings of the Administrative Trustees may
be held at a time and place fixed by resolution of the Administrative Trustees.
Notice of any in-person meetings of the Administrative Trustees shall be hand
delivered or otherwise delivered in writing (including by facsimile, with a
hard copy by overnight courier) not less than 24 hours before such meeting.
Notice of any telephonic meetings of the Administrative Trustees or any
committee thereof shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than
24 hours before a meeting. Notices shall contain a brief statement of the time,
place and anticipated purposes of the meeting. The presence (whether in person
or by telephone) of an Administrative Trustee at a meeting shall constitute a
waiver of notice of such meeting except where an Administrative Trustee attends
a meeting for the express purpose of objecting to the transaction of any
activity on the ground that the meeting has not been lawfully called or
convened. Unless provided otherwise in this Declaration, any action of the
Administrative Trustees may be taken at a meeting by vote of a majority of the
Administrative Trustees present (whether in person or by telephone) and
eligible to
33
40
vote with respect to such matter, provided that, a Quorum is present, or
without a meeting by the unanimous written consent of the Administrative
Trustees. In the event there is only one Administrative Trustee, any and all
action of such Administrative Trustee shall be evidenced by a written consent
of such Administrative Trustee.
SECTION 5.10 Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 3.6, including any Registration Statement or amendment
thereto filed with the Commission, or making any other governmental filing.
(b) The Administrative Trustees shall have power to
delegate from time to time to such of their number or to officers of the Trust
the doing of such things and the execution of such instruments either in the
name of the Trust or the names of the Administrative Trustees or otherwise as
the Administrative Trustees may deem expedient, to the extent such delegation
is not prohibited by applicable law or contrary to the provisions of this
Declaration.
SECTION 5.11 Merger, Conversion, Consolidation or Succession to
Business.
Any Person into which the Property Trustee or the Delaware
Trustee or any Administrative Trustee that is not a natural person, as the case
may be, may be merged or converted or with which it may be consolidated, or any
Person resulting from any merger, conversion or consolidation to which the
Property Trustee or the Delaware Trustee, as the case may be, shall be a party,
or any Person succeeding to all or substantially all the corporate trust
business of the Property Trustee or the Delaware Trustee, as the case may be,
shall be the successor of the Property Trustee or the Delaware Trustee, as the
case may be, hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided such Person
shall be otherwise qualified and eligible under this Article and provided
further that, in the case of the Delaware Trustee, such Person shall file an
amendment to the Certificate of Trust with the Delaware Secretary of State as
contemplated in Section 5.6(h).
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions in accordance with the
applicable terms of the relevant Holder's Securities. If and to the extent that
the Debenture Issuer makes a payment of interest (including Compounded Interest
and Additional Sums) and/or principal on the Series A 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 (a "Distribution") of the Payment Amount
to Holders in accordance with the terms of the Securities.
34
41
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Administrative Trustees shall, on behalf of the
Trust, issue one class of capital securities representing preferred undivided
beneficial interests in the assets of the Trust having such terms as are set
forth in Annex I (the "Series A Capital Securities") and one class of common
securities representing common undivided beneficial interests in the assets of
the Trust having such terms as are set forth in Annex I (the "Common
Securities"). The Trust shall issue no securities or other interests in the
assets of the Trust other than the Series A Capital Securities and the Common
Securities.
(b) 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.
(c) Upon issuance of the Securities as provided in this
Declaration, the Securities so issued shall be deemed to be validly issued,
fully paid and nonassessable.
(d) Every Person, by virtue of having become a Holder or
a Series A Capital Security Beneficial Owner in accordance with the terms of
this Declaration, shall be deemed to have expressly assented and agreed to the
terms of, and shall be bound by, this Declaration.
SECTION 7.2 Issuance of Series A Capital Securities and Common
Securities.
(a) As of December [___], 1998, the Sponsor, on behalf of
the Trust and pursuant to the Original Declaration, executed and delivered the
Underwriting Agreement. Contemporaneously with the execution and delivery of
this Declaration, an Administrative Trustee, on behalf of the Trust, shall
execute in accordance with Section 7.3 and deliver to the Underwriters named in
the Underwriting Agreement, Series A Capital Security Certificates, registered
in the name of the nominee of the initial Clearing Agency, in an aggregate
amount of 1,100,000 Series A Capital Securities having an aggregate Liquidation
Amount of $11,000,000, against receipt of an aggregate purchase price of
$11,000,000, which amount such Administrative Trustee shall promptly deliver to
the Property Trustee. If the Underwriters exercise their Option and there is an
Option Securities Closing Date, then an Administrative Trustee, on behalf of
the Trust, shall execute in accordance with Section 7.3 and deliver to the
Underwriters named in the Underwriting Agreement, additional Series A Capital
Security Certificates, registered in the name of the nominee of the initial
Clearing Agency, in an aggregate amount of up to 165,000 Series A Capital
Securities having an aggregate Liquidation Amount of up to $1,650,000 against
receipt of the aggregate purchase price of up to $1,650,000, which amount such
Administrative Trustee shall promptly deliver to the Property Trustee.
(b) Contemporaneously with the execution and delivery of
this Declaration, an Administrative Trustee, on behalf of the Trust, shall
execute in accordance with Section 7.3 and
35
42
deliver to the Sponsor Common Security Certificates, registered in the name of
the Sponsor, in an aggregate amount of 34,021 Common Securities having an
aggregate Liquidation Amount of $340,210 against payment by the Sponsor of an
aggregate purchase price of $340,210, which amount such Administrative Trustee
shall promptly deliver to the Property Trustee. Contemporaneously therewith, an
Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase
from the Sponsor Series A Subordinated Debentures, registered in the name of the
Property Trustee and having an aggregate principal amount equal to $11,340,210,
and, in satisfaction of the purchase price, the Property Trustee, on behalf of
the Property Trustee, shall deliver to the Sponsor the sum of $11,340,210 (being
the sum of the amounts delivered to the Property Trustee pursuant to (i) the
second sentence of Section 7.2(a) and (ii) the first sentence of this Section
7.2(b)).
(c) If the Underwriters exercise the Option and there is
an Option Securities Closing Date, then an Administrative Trustee, on behalf of
the Trust, shall execute in accordance with Section 7.3 and deliver to the
Sponsor, Common Securities Certificates, registered in the name of the Sponsor,
in an aggregate amount of up to 5,104 Common Securities having an aggregate
Liquidation Amount of up to $51,040 against Payment by the Sponsor of an
aggregate purchase price of up to $51,040, which amount such Administrative
Trustee shall promptly deliver to the Property Trustee. Contemporaneously
therewith, an Administrative Trustee, on behalf of the Trust, shall subscribe to
and purchase from the Sponsor Series A Subordinated Debentures, registered in
the name of the Property Trustee and having an aggregate principal amount of up
to $1,701,040, and, in satisfaction of the purchase price of such Debentures,
the Property Trustee, on behalf of the Trust, shall deliver to the Sponsor the
sum of up to $1,701,040 (being the sum of the amounts delivered to the Property
Trustee pursuant to (i) the third sentence of Section 7.2(a) and (ii) the first
sentence of this Section 7.2(c)).
SECTION 7.3 The Trust Security Certificates
The Series A Capital Security Certificates shall be issued
in minimum denominations of $10 Liquidation Amount and integral multiples of $10
in excess thereof, and the Common Security Certificates shall be issued in
denominations of $10 Liquidation Amount and integral multiples thereof. The
Trust Security Certificates shall be executed on behalf of the Trust by manual
or facsimile signature of at least one Administrative Trustee. The Series A
Capital Security Certificates shall be authenticated by the Property Trustee by
manual signature of an authorized signatory thereof. Trust Security Certificates
bearing the signatures of individuals who were, at the time when such signatures
shall have been affixed, authorized to sign on behalf of the Trust or the
Property Trustee shall be validly issued and entitled to the benefits of this
Declaration, notwithstanding that such individuals or any of them shall have
ceased to be so authorized prior to the delivery of such Trust Security
Certificates or did not hold such offices at the date of delivery of such Trust
Security Certificates. A transferee of a Trust Security Certificate shall become
a Holder, and shall be entitled to the rights and subject to the obligations of
a Holder hereunder, upon due registration of such Trust Security Certificate in
such transferee's name pursuant to Sections 7.5, 7.7 and 9.2.
36
43
SECTION 7.4 Execution and Delivery of Trust Security Certificates
On each Closing Date, the Administrative Trustees shall
cause Trust Security Certificates, in an aggregate Liquidation Amount as
provided in Section 7.2, to be executed on behalf of the Trust authenticated by
the Property Trustee and delivered to or upon the written order of the Sponsor,
signed by its chairman of the board, its president, any executive or senior vice
president, any managing director or any vice president, treasurer, assistant
treasurer or controller without further corporate action by the Sponsor, in
authorized denominations.
SECTION 7.5 Registrar, Paying Agent and Exchange Agent.
The Trust shall maintain in Wilmington, Delaware, (i) an
office or agency where Series A Capital Securities may be presented for
registration of transfer ("Registrar"), (ii) an office or agency where Series A
Capital Securities may be presented for payment ("Paying Agent") and (iii) an
office or agency where Securities may be presented for exchange ("Exchange
Agent"). The Registrar shall keep a register of the Series A Capital Securities
and of their transfer. The Trust may appoint the Registrar, the Paying Agent and
the Exchange Agent and may appoint one or more co-registrars, one or more
additional paying agents and one or more additional Exchange Agents in such
other locations as it shall determine. The term "Registrar" includes any
additional registrar, the term "Paying Agent" includes any additional paying
agent and the term "Exchange Agent" includes any additional Exchange Agent. The
Trust may change any Paying Agent, Registrar, co-registrar or Exchange Agent
without prior notice to any Holder. The Paying Agent, Registrar and Exchange
Agent shall be permitted to resign as Paying Agent upon 30 days' written notice
to the Property Trustee, the Administrative Trustees and the Sponsor. The Trust
shall notify the Property Trustee of the name and address of any Agent not a
party to this Declaration. If the Trust fails to appoint or maintain another
entity as Registrar, Paying Agent or Exchange Agent, the Property Trustee shall
act as such. The Trust or any of its Affiliates may act as Paying Agent,
Registrar, or Exchange Agent. The Trust shall act as Paying Agent, Registrar and
Exchange Agent for the Common Securities.
The Trust initially appoints the Property Trustee as
Registrar, Paying Agent and Exchange Agent for the Series A Capital Securities.
SECTION 7.6 Registration of Transfer and Exchange of Series A Capital
Security Certificates
Upon surrender for registration of transfer of any
Series A Capital Security Certificate at the office or agency maintained
pursuant to Section 7.5, the Administrative Trustee, or any one of them shall
execute on behalf of the Trust, cause to be authenticated by the Property
Trustee and deliver, in the name of the designated transferee or transferees,
one or more new Series A Capital Security Certificates in authorized
denominations of a like aggregate Liquidation Amount dated the date of execution
by such Administrative Trustee or Trustees in accordance with the requirements
of Section 9.2(b).
37
44
At the option of a Holder, Series A Capital Security
Certificates may be exchanged for other Series A Capital Security Certificates
in authorized denominations of the same class and of a like aggregate
Liquidation Amount upon surrender of the Series A Capital Security Certificates
to be exchanged at the office or agency maintained pursuant to Section 7.5.
Every Series A Capital Security Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to an Administrative
Trustee and the Securities Registrar duly executed by the Holder or such
Holder's attorney duly authorized in writing. Each Series A Capital Security
Certificate surrendered for registration of transfer or exchange shall be
canceled and subsequently disposed of by an Administrative Trustee or the
Securities Registrar in accordance with such Person's customary practice.
SECTION 7.7 Book-Entry Series A Capital Security Certificates; Common
Security Certificate
(a) The Series A Capital Security Certificates, upon
original issuance, will be issued in the form of a typewritten Series A Capital
Security Certificate or Certificates representing Book-Entry Series A Capital
Security Certificates, to be delivered to The Depository Trust Company, the
initial Clearing Agency, by, or on behalf of, the Trust. Such Series A Capital
Security Certificate or Certificates shall initially be registered on the
Securities Register in the name of Cede & Co., the nominee of the initial
Clearing Agency, and no Capital Securities Beneficial Owner will receive a
Definitive Series A Capital Security Certificate representing such Capital
Securities Beneficial Owner's interest in such Series A Capital Securities,
except as provided in Section 9.2. Unless and until Definitive Series A Capital
Security Certificates have been issued to Capital Securities Beneficial Owners
pursuant to Section 9.2:
(i) the provisions of this Section 7.7(a) shall be
in full force and effect;
(ii) the Securities Registrar and the Trustees
shall be entitled to deal with the Clearing Agency for
all purposes of this Declaration relating to the
Book-Entry Series A Capital Security Certificates
(including the payment of the Liquidation Amount of and
Distributions on the Series A Capital Securities
evidenced by Book-Entry Series A Capital Security
Certificates and the giving of instructions or directions
to Capital Securities Beneficial Owners of Series A
Capital Securities evidenced by Book-Entry Series A
Capital Security Certificates) as the sole Holder of
Series A Capital Securities evidenced by Book-Entry
Series A Capital Security Certificates and shall have no
obligations to the Capital Securities Beneficial Owners
thereof;
(iii) to the extent that the provisions of this
Section 7.7 conflict with any other provisions of this
Declaration, the provisions of this Section 7.7 shall
control; and
(iv) the rights of the Capital Securities
Beneficial Owners of the Book-Entry Series A Capital
Security Certificates shall be exercised only through
38
45
the Clearing Agency and shall be limited to those
established by law and agreements between such Capital
Securities Beneficial Owners and the Clearing Agency
and/or the Clearing Agency Participants. Unless and until
Definitive Series A Capital Security Certificates are
issued pursuant to Section 9.2, the initial Clearing
Agency will make book-entry transfers among the Clearing
Agency Participants and receive and transmit payments on
the Series A Capital Securities to such Clearing Agency
Participants.
(b) A Common Security Certificate representing the Common
Securities shall be issued to the Sponsor on each Closing Date in the form of a
definitive Common Security Certificate.
SECTION 7.8 Paying Agent to Hold Money in Trust.
The Trust shall require each Paying Agent other than the
Property Trustee to agree in writing that the Paying Agent will hold in trust
for the benefit of Holders or the Property Trustee all money held by the Paying
Agent for the payment of liquidation amounts or Distributions, and will notify
the Property Trustee if there are insufficient funds for such purpose. While
any such insufficiency continues, the Property Trustee may require a Paying
Agent to pay all money held by it to the Property Trustee. The Trust at any
time may require a Paying Agent to pay all money held by it to the Property
Trustee and to account for any money disbursed by it. Upon payment over to the
Property Trustee, the Paying Agent (if other than the Trust or an Affiliate of
the Trust) shall have no further liability for the money. If the Trust or the
Sponsor or an Affiliate of the Trust or the Sponsor acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the
Holders all money held by it as Paying Agent.
SECTION 7.9 Replacement Securities.
If a Holder claims that a Security owned by it has been
lost, destroyed or wrongfully taken or if such Security is mutilated and is
surrendered to the Trust or in the case of the Series A Capital Securities to
the Property Trustee, an Administrative Trustee shall execute and the Property
Trustee shall authenticate and make available for delivery a replacement
Security if the Property Trustee's requirements are met. An indemnity bond must
be provided by the Holder which, in the judgment of the Property Trustee, is
sufficient to protect the Trustees, the Sponsor, the Trust or any
authenticating agent from any loss which any of them may suffer if a Security
is replaced. The Trust may charge such Holder for its expenses in replacing a
Security.
SECTION 7.10 Outstanding Series A Capital Securities.
The Series A Capital Securities outstanding at any time
are all the Series A Capital Securities authenticated by the Property Trustee
except for those canceled by it, those delivered to it for cancellation, and
those described in this Section as not outstanding.
39
46
If a Series A Capital Security is replaced, paid or
purchased pursuant to Section 7.9 hereof, it ceases to be outstanding unless
the Property Trustee receives proof satisfactory to it that the replaced, paid
or purchased Series A Capital Security is held by a bona fide purchaser.
If Series A Capital Securities are considered paid in
accordance with the terms of this Declaration, they cease to be outstanding and
Distributions on them shall cease to accumulate.
A Series A Capital Security does not cease to be
outstanding because one of the Trust, the Sponsor or an Affiliate of the
Sponsor holds the Security.
SECTION 7.11 Series A Capital Securities in Treasury.
In determining whether the Holders of the required amount
of Securities have concurred in any direction, waiver or consent, Series A
Capital Securities owned by the Trust, the Sponsor or an Affiliate of the
Sponsor, as the case may be, shall be disregarded and deemed not to be
outstanding, except that for the purposes of determining whether the Property
Trustee shall be fully protected in relying on any such direction, waiver or
consent, only Securities which the Property Trustee actually knows are so owned
shall be so disregarded.
SECTION 7.12 Cancellation.
The Trust at any time may deliver Series A Capital
Securities to the Property Trustee for cancellation. The Registrar, Paying
Agent and Exchange Agent shall forward to the Property Trustee any Series A
Capital Securities surrendered to them for registration of transfer,
redemption, exchange or payment. The Property Trustee shall promptly cancel all
Series A Capital Securities surrendered for registration of transfer,
redemption, exchange, payment, replacement or cancellation and shall dispose of
canceled Series A Capital Securities in accordance with its customary
procedures unless the Trust otherwise directs. The Trust may not issue new
Series A Capital Securities to replace Series A Capital Securities that it has
paid or that have been delivered to the Property Trustee for cancellation or
that any Holder has exchanged.
SECTION 7.13 CUSIP Numbers.
The Trust in issuing the Series A Capital Securities may
use "CUSIP" numbers (if then generally in use), and, if so, the Property
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders of Series A Capital Securities; provided that, any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Series A Capital Securities or as contained in any
notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Series A Capital Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Sponsor will promptly notify the Property Trustee of any change in the
CUSIP numbers.
40
47
ARTICLE VIII
DISSOLUTION OF TRUST
SECTION 8.1 Dissolution of Trust.
(a) The Trust shall dissolve:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of
dissolution or liquidation or its equivalent with respect
to the Sponsor; or the revocation of the Sponsor's
charter and the expiration of 90 days after the date of
revocation without a reinstatement thereof;
(iii) following the distribution of a Like Amount
of the Series A Debentures to the Holders, provided that,
the Property Trustee has received written notice from the
Sponsor directing the Property Trustee to dissolve the
Trust (which direction is optional, and except as
otherwise expressly provided below, within the discretion
of the Sponsor), and provided, further, that such
direction and such distribution is conditioned on (a) the
receipt by the Sponsor of any and all required regulatory
approvals, and (b) the Sponsor's receipt and delivery to
the Administrative Trustees of an opinion of independent
tax counsel experienced in such matters to the effect
that the Holders of the Series A Capital Securities will
not recognize any gain or loss for United States federal
income tax purposes as a result of the dissolution of the
Trust and the distribution of Series A Debentures;
(iv) upon the entry of a decree of judicial
dissolution of the Trust by a court of competent
jurisdiction;
(v) when all of the Securities shall have been
called for redemption and the amounts necessary for
redemption thereof shall have been paid to the Holders in
accordance with the terms of the Securities;
(vi) upon the redemption or repayment of the
Series A Debentures or at such time as no Series A
Debentures are outstanding; or
(vii) the expiration of the term of the Trust
provided in Section 3.14.
(b) As soon as is practicable upon completion of winding
up of the Trust following the occurrence of an event referred to in Section
8.1(a) and the satisfaction of creditors of the Trust in accordance with
applicable law, the Administrative Trustees shall terminate the Trust by filing
a certificate of cancellation with the Secretary of State of the State of
Delaware in accordance with the Business Trust Act.
41
48
(c) The provisions of Section 3.9 and Article X shall
survive the dissolution of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in
part, in accordance with the terms and conditions set forth in this Declaration
and in the terms of the Securities. To the fullest extent permitted by law, any
transfer or purported transfer of any Security not made in accordance with this
Declaration shall be null and void.
(b) Subject to this Article IX, Series A Capital
Securities may only be transferred, in whole or in part, in accordance with the
terms and conditions set forth in this Declaration. To the fullest extent
permitted by law, any transfer or purported transfer of any Security not made
in accordance with this Declaration shall be null and void.
(c) For so long as the Securities remain outstanding, the
Sponsor agrees (i) not to transfer ownership of the Common Securities of the
Trust, provided that any permitted successor of the Sponsor under the Indenture
may succeed to the Sponsor's ownership of the Common Securities, (ii) not to
cause, as Sponsor of the Trust, or to permit, as Holder of the Common
Securities, the dissolution, winding-up or liquidation of the Trust, except as
provided in this Declaration and (iii) to use its best efforts to cause the
Trust (a) to remain a business trust, except in connection with the
distribution of Series A Debentures to the Holders in liquidation of the Trust,
the redemption of all of the Securities, or certain mergers, consolidations or
amalgamations, each as permitted by this Declaration, and (b) not to be
classified as an association taxable as a corporation and to be classified as a
grantor trust for United States federal income tax purposes.
SECTION 9.2 Definitive Series A Capital Security Certificates
(a) If (i) the Sponsor advises the Trustees in writing
that the Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Series A Capital Security Certificates,
and the Sponsor is unable to locate a qualified successor, (ii) the Sponsor at
its option advises the Trustees in writing that it elects to terminate the
book-entry system through the Clearing Agency or (iii) after the occurrence of
an Event of Default, Capital Securities Beneficial Owners representing
beneficial interests aggregating at least a majority of the Liquidation Amount
advise the Administrative Trustees in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interest
of the Capital Securities Beneficial Owners, then the Administrative Trustees
shall notify the other Trustees and the Clearing Agency, and the Clearing
Agency, in accordance with its customary rules and procedures, shall notify all
Clearing Agency Participants for whom it holds Series A Capital Securities of
the occurrence of any such event and of the availability of the Definitive
Series A Capital Security Certificates to Capital Securities Beneficial Owners
of such class or classes, as applicable, requesting the same. Upon
42
49
surrender to the Administrative Trustees of the typewritten Series A Capital
Security Certificate or Certificates representing the Book-Entry Series A
Capital Security Certificates by the Clearing Agency, accompanied by
registration instructions, the Administrative Trustees, or any one of them,
shall execute the Definitive Series A Capital Security Certificates in
accordance with the instructions of the Clearing Agency or, if executed on
behalf of the Trust by facsimile, countersigned by a transfer agent or its
agent. Neither the Registrar nor the Trustees shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Series A Capital Security Certificates, the Trustees shall recognize the
Holders of the Definitive Series A Capital Security Certificates as Holders.
The Definitive Series A Capital Security Certificates shall be typewritten,
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrative Trustees that meets the
requirements of any stock exchange or automated quotation system on which the
Series A Capital Securities are then listed or approved for trading, as
evidenced by the execution thereof by the Administrative Trustees or any one of
them.
(b) Obligations with Respect to Transfers and Exchanges
of Series A Capital Securities.
(i) To permit registrations of transfers and
exchanges, the Trust shall execute and the Property
Trustee shall authenticate Definitive Series A Capital
Securities and the Global Capital Security at the
Registrar's or co-registrar's request in accordance with
the terms of this Declaration.
(ii) Registrations of transfers or exchanges will
be effected without charge, but only upon payment (with
such indemnity as the Trust or the Sponsor may require)
in respect of any tax or other governmental charge that
may be imposed in relation to it.
(iii) The Registrar or co-registrar shall not be
required to register the transfer of or exchange of (a)
Series A Capital Securities during a period beginning at
the opening of business 15 days before the day of mailing
of a notice of redemption or any notice of selection of
Series A Capital Securities for redemption and ending at
the close of business on the day of such mailing or (b)
any Series A Capital Security so selected for redemption
in whole or in part, except the unredeemed portion of any
Series A Capital Security being redeemed in part.
(iv) Prior to the due presentation for registration
of transfer of any Series A Capital Security, the Trust,
the Property Trustee, the Paying Agent, the Registrar or
any co-registrar may deem and treat the Person in whose
name a Series A Capital Security is registered as the
absolute owner of such Series A Capital Security for the
purpose of receiving Distributions on such Series A
Capital Security and for all other purposes whatsoever,
and none of the Trust, the Property Trustee, the Paying
Agent, the Registrar or any co-registrar shall be affected
by notice to the contrary.
43
50
(v) All Series A Capital Securities issued upon
any registration of transfer or exchange pursuant to the
terms of this Declaration shall evidence the same
security and shall be entitled to the same benefits under
this Declaration as the Series A Capital Securities
surrendered upon such registration of transfer or
exchange.
(c) No Obligation of the Property Trustee.
(i) The Property Trustee shall have no
responsibility or obligation to any Capital Security
Beneficial Owner, a Participant in the Clearing Agency or
other Person with respect to the accuracy of the records
of the Clearing Agency or its nominee or of any
Participant thereof, with respect to any ownership
interest in the Series A Capital Securities or with
respect to the delivery to any Participant, beneficial
owner or other Person (other than the Clearing Agency) of
any notice (including any notice of redemption) or the
payment of any amount, under or with respect to such
Series A Capital Securities. All notices and
communications to be given to the Holders and all
payments to be made to Holders under the Series A Capital
Securities shall be given or made only to or upon the
order of the registered Holders (which shall be the
Clearing Agency or its nominee in the case of the Global
Capital Security). The rights of Capital Security
Beneficial Owners shall be exercised only through the
Clearing Agency subject to the applicable rules and
procedures of the Clearing Agency. The Property Trustee
may conclusively rely and shall be fully protected in
relying upon information furnished by the Clearing Agency
or any agent thereof with respect to its Participants and
any Capital Security Beneficial Owners.
(ii) The Property Trustee and the Registrar shall
have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on
transfer imposed under this Declaration or under
applicable law with respect to any transfer of any
interest in any Series A Capital Security (including any
transfers between or among Clearing Agency Participants
or Capital Security Beneficial Owners) other than to
require delivery of such certificates and other
documentation or evidence as are expressly required by,
and to do so if and when expressly required by, the terms
of this Declaration, and to examine the same to determine
substantial compliance as to form with the express
requirements hereof.
SECTION 9.3 Temporary Securities.
(a) Until Definitive Capital Securities are ready for
delivery, the Trust may prepare and, in the case of the Capital Securities, the
Property Trustee shall authenticate temporary Securities. Temporary Securities
shall be substantially in the form of Definitive Series A Capital Securities,
but may have variations that the Trust considers appropriate for temporary
Securities. Without unreasonable delay, the Trust shall prepare and, in the
case of the Series A Capital
44
51
Securities, the Property Trustee shall authenticate Definitive Capital
Securities in exchange for temporary Securities.
(b) The Global Capital Security deposited with the
Clearing Agency or with the Property Trustee as custodian for the Clearing
Agency shall be transferred to the beneficial owners thereof in the form of
Definitive Capital Securities only if such transfer complies with Section 9.2
and (i) the Clearing Agency notifies the Sponsor that it is unwilling or unable
to continue as Clearing Agency for such Global Capital Security or if at any
time such Clearing Agency ceases to be a "clearing agency" registered under the
Exchange Act, and, in each case, a clearing agency is not appointed by the
Sponsor within 90 days of receipt of such notice or of becoming aware of such
condition, (ii) a Default or an Event of Default has occurred and is continuing
or (iii) the Trust at its sole discretion elects to cause the issuance of
Definitive Capital Securities.
(c) Any Global Capital Security that is transferable to
the beneficial owners thereof in the form of Definitive Capital Securities
shall be surrendered by the Clearing Agency to the Property Trustee to be so
transferred, in whole or from time to time in part, without charge, and the
Property Trustee shall authenticate and make available for delivery, upon such
transfer of each portion of such Global Capital Security, an equal aggregate
liquidation amount of Securities of authorized denominations in the form of
Definitive Capital Securities. Any portion of the Global Capital Security
transferred pursuant to this Section shall be registered in such names as the
Clearing Agency shall direct.
(d) Subject to the provisions of Section 9.3(c), the
Holder of the Global Capital Security may grant proxies and otherwise authorize
any Person, including Participants and Persons that may hold interests through
Participants, to take any action which such Holder is entitled to take under
this Declaration or the Securities.
(e) In the event of the occurrence of any of the events
specified in Section 7.9(b), the Trust will promptly make available to the
Property Trustee a reasonable supply of certificated Capital Securities in
fully registered form without distribution coupons.
SECTION 9.4 Deemed Security Holders.
The Trustees may treat the Person in whose name any
Security shall be registered on the books and records of the Trust as the sole
owner and Holder of such Security for purposes of receiving Distributions and
for all other purposes whatsoever and, accordingly, shall not be bound to
recognize any equitable or other claim to or interest in such Security on the
part of any Person, whether or not the Trust shall have actual or other notice
thereof.
SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Series A
Capital Security Holders is required to be given by a Trustee under this
Declaration, such Trustee shall give all such notices and communications
specified herein to be given to the Holder of the Global Capital Security
45
52
to the Clearing Agency and shall have no notice obligations to the Capital
Security Beneficial Owners.
SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services
as securities depositary with respect to the Series A Capital Securities, the
Administrative Trustees may, in their sole discretion, appoint a successor
Clearing Agency with respect to such Series A Capital Securities.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration,
the Securities Guarantees and the terms of the Securities, the Sponsor shall
not be:
(i) personally liable for the return of any
portion of the capital contributions (or any return
thereon) of the Holders which shall be made solely from
assets of the Trust; and
(ii) required to pay to the Trust or to any Holder
any deficit upon dissolution of the Trust or otherwise.
(b) The Sponsor shall be liable for all of the debts and
obligations of the Trust (other than in respect of the Securities) to the
extent not satisfied out of the Trust's assets.
(c) Pursuant to ss. 3803(a) of the Business Trust Act,
the Holders shall be entitled to the same limitation of personal liability
extended to stockholders of private corporations for profit organized under the
General Corporation Law of the State of Delaware.
SECTION 10.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in
a manner such Indemnified Person reasonably believed to be within the scope of
the authority conferred on such Indemnified Person by this 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 or the Delaware Trustee,
negligence) or willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in
relying in good faith upon the records of the Trust and upon such information,
opinions, reports or statements presented to the
46
53
Trust by any Person as to matters the Indemnified Person reasonably believes
are within such other Person's professional or expert competence and who has
been selected with reasonable care by or on behalf of the Trust, including
information, opinions, reports or statements as to the value and amount of the
assets, liabilities, profits, losses, or any other facts pertinent to the
existence and amount of assets from which Distributions to Holders might
properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this 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 any Covered Person and any 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
47
54
(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 10.4 Indemnification.
(a) (i) The Sponsor shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Trust) by reason of the fact
that he is or was a Company Indemnified Person, against expenses (including
attorneys' fees and expenses), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Trust, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that the Company
Indemnified Person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the Trust,
and, with respect to any criminal action or proceeding, had reasonable cause to
believe that his conduct was unlawful.
(ii) The Sponsor shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified Person against
expenses (including attorneys' fees and expenses) actually and reasonably
incurred by him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the Trust and except that no such
indemnification shall be made in respect of any claim, issue or matter as to
which such Company Indemnified Person shall have been adjudged to be liable to
the Trust unless and only to the extent that the Court of Chancery of Delaware
or the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all the
circumstances of the case, such Person is fairly and reasonably entitled to
indemnity for such expenses which such Court of Chancery or such other court
shall deem proper.
(iii) To the extent that a Company Indemnified
Person shall be successful on the merits or otherwise (including dismissal of
an action without prejudice or the settlement of an action without admission of
liability) in defense of any action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 10.4(a), or in defense of any claim,
issue or matter therein, he shall be indemnified, to the full extent permitted
by law, against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(iv) Any indemnification under paragraphs (i) and
(ii) of this Section 10.4(a) (unless ordered by a court) shall be made by the
Sponsor only as authorized in the specific case upon a determination that
indemnification of the Company Indemnified Person is proper in the
48
55
circumstances because he has met the applicable standard of conduct set forth
in paragraphs (i) and (ii). Such determination shall be made (1) by the
Administrative Trustees by a majority vote of a Quorum consisting of such
Administrative Trustees who were not parties to such action, suit or
proceeding, (2) if such a Quorum is not obtainable, or, even if obtainable, if
a Quorum of disinterested Administrative Trustees so directs, by independent
legal counsel in a written opinion, or (3) by the Common Security Holder of the
Trust.
(v) Expenses (including attorneys' fees and
expenses) incurred by a Company Indemnified Person in defending a civil,
criminal, administrative or investigative action, suit or proceeding referred
to in paragraphs (i) and (ii) of this Section 10.4(a) shall be paid by the
Sponsor in advance of the final disposition of such action, suit or proceeding
upon receipt of an undertaking by or on behalf of such Company Indemnified
Person to repay such amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Sponsor as authorized in this Section
10.4(a). Notwithstanding the foregoing, no advance shall be made by the Sponsor
if a determination is reasonably and promptly made (i) by the Administrative
Trustees by a majority vote of a Quorum of disinterested Administrative
Trustees, (ii) if such a Quorum is not obtainable, or, even if obtainable, if a
Quorum of disinterested Administrative Trustees so directs, by independent
legal counsel in a written opinion or (iii) by the Common Security Holder of
the Trust, that, based upon the facts known to the Administrative Trustees,
counsel or the Common Security Holder at the time such determination is made,
such Company Indemnified Person acted in bad faith or in a manner that the
Common Security Holder did not believe to be in or not opposed to the best
interests of the Trust, or, with respect to any criminal proceeding, that such
Company Indemnified Person believed or had reasonable cause to believe his
conduct was unlawful. In no event shall any advance be made in instances where
the Administrative Trustees, independent legal counsel or Common Security
Holder reasonably determine that a Company Indemnified Person deliberately
breached his duty to the Trust or its Common or Series A Capital Security
Holders.
(vi) The indemnification and advancement of expenses
provided by, or granted pursuant to, the other paragraphs of this Section
10.4(a) shall not be deemed exclusive of any other rights to which those
seeking indemnification and advancement of expenses may be entitled under any
agreement, vote of stockholders or disinterested directors of the Sponsor or
Series A Capital Security Holders of the Trust or otherwise, both as to action
in his official capacity and as to action in another capacity while holding
such office. All rights to indemnification under this Section 10.4(a) shall be
deemed to be provided by a contract between the Sponsor and each Company
Indemnified Person who serves in such capacity at any time while this Section
10.4(a) is in effect. Any repeal or modification of this Section 10.4(a) shall
not affect any rights or obligations then existing.
(vii) The Sponsor or the Trust may purchase and
maintain insurance on behalf of any person who is or was a Company Indemnified
Person against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the
Debenture Issuer would have the power to indemnify him against such liability
under the provisions of this Section 10.4(a).
49
56
(viii) For purposes of this Section 10.4(a),
references to "the Trust" shall include, in addition to the resulting or
surviving entity, any constituent entity (including any constituent of a
constituent) absorbed in a consolidation or merger, so that any person who is
or was a director, trustee, officer or employee of such constituent entity, or
is or was serving at the request of such constituent entity as a director,
trustee, officer, employee or agent of another entity, shall stand in the same
position under the provisions of this Section 10.4(a) with respect to the
resulting or surviving entity as he would have with respect to such constituent
entity if its separate existence had continued.
(ix) The indemnification and advancement of
expenses provided by, or granted pursuant to, this Section 10.4(a) shall,
unless otherwise provided when authorized or ratified, continue as to a Person
who has ceased to be a Company Indemnified Person and shall inure to the
benefit of the heirs, executors and administrators of such a Person.
(b) The Sponsor agrees to indemnify the (i) Property
Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the Property Trustee
or the Delaware Trustee, and (iv) any officers, directors, shareholders,
members, partners, employees, representatives, custodians, nominees or agents
of the Property Trustee or the Delaware Trustee (each of the Persons in (i)
through (iv), including the Property Trustee and the Delaware Trustee in their
respective individual capacities, being referred to as a "Fiduciary Indemnified
Person") for, and to hold each Fiduciary Indemnified Person harmless against,
any and all loss, liability, damage, action, suit, claim or expense including
taxes (other than taxes based on the income of such Fiduciary Indemnified
Person) of any kind and nature whatsoever incurred without negligence or bad
faith on the part of such Fiduciary Indemnified Person, 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 against or investigating any claim or liability in
connection with the exercise or performance of any of the powers or duties of
such Fiduciary Indemnified Person hereunder. The obligation to indemnify as set
forth in this Section 10.4(b) shall survive the resignation or removal of the
Property Trustee or the Delaware Trustee and the satisfaction and discharge of
this Declaration.
(c) The Sponsor agrees to pay the Property Trustee and
the Delaware Trustee, from time to time, such compensation for all services
rendered by the Property Trustee and the Delaware Trustee hereunder as may be
mutually agreed upon in writing by the Sponsor and the Property Trustee or the
Delaware Trustee, as the case may be, and, except as otherwise expressly
provided herein, to reimburse the Property Trustee and the Delaware Trustee
upon its or their request for all reasonable expenses (including legal fees and
expenses), disbursements and advances incurred or made by the Property Trustee
or the Delaware Trustee, as the case may be, in accordance with the provisions
of this Declaration, except any such expense, disbursement or advance as may be
attributable to its or their negligence or bad faith.
50
57
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and
the Property Trustee (subject to Section 5.3(c)) may engage in or possess an
interest in other business ventures of any nature or description, independently
or with others, similar or dissimilar to the business of the Trust, and the
Trust and the Holders shall have no rights by virtue of this Declaration in and
to such independent ventures or the income or profits derived therefrom, and
the pursuit of any such venture, even if competitive with the business of the
Trust, shall not be deemed wrongful or improper. No Covered Person, the
Sponsor, the Delaware Trustee, or the Property Trustee shall be obligated to
present any particular investment or other opportunity to the Trust even if
such opportunity is of a character that, if presented to the Trust, could be
taken by the Trust, and any Covered Person, the Sponsor, the Delaware Trustee
and the Property Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Covered Person, the Delaware
Trustee and the Property Trustee may engage or be interested in any financial
or other transaction with the Sponsor or any Affiliate of the Sponsor, or may
act as depositary for, trustee or agent for, or act on any committee or body of
holders of, securities or other obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the
Administrative Trustees shall keep, or cause to be kept, full books of account,
records and supporting documents, which shall reflect in reasonable detail each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting
principles, consistently applied. The Trust shall use the accrual method of
accounting for United States federal income tax purposes. The books 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 Administrative Trustees.
(b) The Administrative Trustees shall cause to be duly
prepared and delivered to each of the Holders any annual United States federal
income tax information statements 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 Administrative Trustees
shall endeavor to deliver all such information statements within 30 days after
the end of each Fiscal Year of the Trust.
51
58
(c) The Administrative Trustees shall cause to be duly
prepared and filed with the appropriate taxing authority, an annual United
States federal income tax return, on a Form 1041 or such other form required by
United States federal income tax law, and any other annual income tax returns
required to be filed by the Administrative Trustees on behalf of the Trust with
any state or local taxing authority.
SECTION 11.3 Banking.
The Trust may maintain one or more bank accounts in the
name and for the sole benefit of the Trust; provided, however, that all
payments of funds in respect of the Series A Debentures held by the Property
Trustee shall be made directly to the Property Trustee Account and no other
funds of the Trust shall be deposited in the Property Trustee Account. The sole
signatories for such accounts shall be designated by the Administrative
Trustees; provided, however, that the Property Trustee shall designate the
signatories for the Property Trustee Account.
SECTION 11.4 Withholding.
The Trust and the Administrative Trustees shall comply
with all withholding requirements under United States federal, state and local
law and under foreign law. The Trust shall request, and the Holders shall
provide to the Trust, such forms or certificates as are necessary to establish
an exemption from withholding with respect to each Holder, and any
representations and forms as shall reasonably be requested by the Trust to
assist it in determining the extent of, and in fulfilling, its withholding
obligations. The Administrative Trustees shall cause to be filed required forms
with applicable jurisdictions and, unless an exemption from withholding is
properly established by a Holder, shall remit amounts withheld with respect to
the Holder to applicable jurisdictions. To the extent that the Trust is
required to withhold and pay over any amounts to any authority with respect to
Distributions or allocations to any Holder, the amount withheld shall be deemed
to be a Distribution in the amount of the withholding to the Holder. In the
event of any claim of excess withholding, Holders shall be limited to an action
against the applicable jurisdiction. If the amount required to be withheld was
not withheld from actual Distributions made, the Trust may reduce subsequent
Distributions by the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration
(including Section 7 of Annex I hereto) or by any applicable terms of the
Securities, this Declaration may only be amended by a written instrument
approved and executed by:
(i) the Sponsor and the Administrative Trustees
(or, if there are more than two Administrative Trustees,
a majority of the Administrative Trustees);
52
59
(ii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Property
Trustee, the Property Trustee; and
(iii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware
Trustee, 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 shall have first received an
Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms
to, the terms of this Declaration (including the terms of
the Securities);
(ii) unless, in the case of any proposed amendment
which affects the rights, powers, duties, obligations or
immunities of the Property Trustee, the Property Trustee
shall have first received:
(A) an Officers' Certificate from each of the
Trust and the Sponsor that such amendment is
permitted by, and conforms to, the terms of this
Declaration (including the terms of the Securities);
and
(B) an Opinion of Counsel (who 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 that all conditions precedent to the execution
and delivery of such amendment have been satisfied;
provided, however, that the Property Trustee and the Delaware Trustee shall not
be required to sign any such amendment which affects its own rights, duties,
warranties or indemnification; and
(iii) to the extent the result of such amendment
would be to:
(A) cause the Trust to fail to continue not to be
classified as an association taxable as a
corporation or to be less likely to be classified as
a grantor trust, in each case for purposes of United
States federal income taxation;
(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, any amendment that would adversely affect
the rights, privileges or preferences of any
53
60
Holder (other than an amendment pursuant to (g)(ii) below) may be effected only
with such additional requirements as may be set forth in the terms of such
Securities;
(d) Section 10.1(c) and this Section 12.1 shall not be
amended without the consent of all of the Holders;
(e) Article Four 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 V to increase or decrease the number of, and appoint and remove
Trustees shall not be amended without the consent of the Holders of a Majority
in Liquidation Amount of the Common Securities; and
(g) Notwithstanding Section 12.1(c), this Declaration may
be amended without the consent of the Holders to:
(i) cure any ambiguity, correct or supplement any
provision in this Declaration that may be inconsistent
with any other provision of this Declaration or to make
any other provisions with respect to matters or questions
arising under this Declaration which shall not be
inconsistent with the other provisions of the
Declaration; and
(ii) to modify, eliminate or add to any provisions
of the Declaration to such extent as shall be necessary
to ensure that the Trust will be classified for United
States federal income tax purposes as a grantor trust 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, however, that in the case of clause (i) above, such action shall not
adversely affect in any material respect the interests of the Holders, and any
such amendments of this Declaration shall become effective when notice thereof
is given to the Holders.
SECTION 12.2 Meetings of the Holders; Action by Written Consent.
(a) Meetings of the Holders of any class of Securities
may be called at any time by the Administrative Trustees (or as provided in the
terms of the Securities) to consider and act on any matter on which Holders of
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 Series A Capital Securities are listed or admitted for trading. The
Administrative 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
Administrative Trustees one or more notices in writing stating that the signing
Holders wish to call a meeting and indicating the general or specific purpose
for which the meeting is to be called. Any Holders calling a meeting shall
specify in writing the Capital Security or Common Security Certificates held by
the Holders exercising the right to call a meeting and only those Securities
specified shall be counted
54
61
for purposes of determining whether the required percentage set forth in the
second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms
of the Securities, the following provisions shall apply to meetings of Holders:
(i) notice of any such meeting shall be given to
all the Holders 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 is permitted or required under this Declaration
or the rules of any stock exchange on which the Series A
Capital Securities are listed or admitted for trading,
such vote, consent or approval may be given at a meeting
of the Holders; any action that may be taken at a meeting
of the Holders may be taken without a meeting if a
consent in writing setting forth the action so taken is
signed by the Holders 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 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 entitled
to vote who have not consented in writing; and the
Administrative Trustees may specify that any written
ballot submitted to the Security Holder for the purpose
of taking any action without a meeting shall be returned
to the Trust within the time specified by the
Administrative Trustees;
(ii) each Holder may authorize any Person to act
for it by proxy on all matters in which a 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 eleven
months from the date thereof unless otherwise provided in
the proxy; every proxy shall be revocable at the pleasure
of the Holder executing it; and, 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
were stockholders of a Delaware corporation;
(iii) each meeting of the Holders shall be
conducted by the Administrative Trustees or by such other
Person that the Administrative Trustees may designate;
and
(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 Series A Capital Securities are then listed
or trading, otherwise provides, the Administrative
Trustees, in their sole discretion, shall establish all
other provisions relating to meetings of Holders,
including notice of the time, place or purpose of any
meeting at which any matter is to be voted on by any
Holders, waiver of any such notice, action by consent
without a meeting, the
55
62
establishment of a record date, quorum requirements,
voting in person or by proxy or any other matter with
respect to the exercise of any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee.
The Trustee that acts as initial Property Trustee
represents and warrants to the Trust and to the Sponsor at the date of this
Declaration, and each Successor Property Trustee represents and warrants to the
Trust and the Sponsor at the time of the Successor Property Trustee's
acceptance of its appointment as Property Trustee that:
(a) the Property Trustee is a banking corporation, a
national banking association or a bank or trust company, duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation, with corporate power and authority to execute and deliver, and
to carry out and perform its obligations under the terms of, this Declaration;
(b) the execution, delivery and performance by the
Property Trustee of this Declaration has been duly authorized by all necessary
corporate action on the part of the Property Trustee; and this Declaration has
been duly executed and delivered by the Property Trustee and under Delaware law
(excluding any securities laws) 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);
(c) the execution, delivery and performance of this
Declaration by the Property Trustee does not conflict with or constitute a
breach of the charter or by-laws of the Property Trustee; and
(d) no consent, approval or authorization of, or
registration with or notice to, any federal or Delaware banking authority
governing the trust powers of the Property Trustee is required for the
execution, delivery or performance by the Property Trustee of this Declaration.
SECTION 13.2 Representations and Warranties of Delaware Trustee.
The Trustee that acts as initial Delaware Trustee
represents and warrants to the Trust and to the Sponsor at the date of this
Declaration, and each Successor Delaware Trustee represents and warrants to the
Trust and the Sponsor at the time of the Successor Delaware Trustee's
acceptance of its appointment as Delaware Trustee that:
(a) the Delaware Trustee is a banking corporation, duly
organized, validly existing and in good standing under the laws of the State of
Delaware, with corporate power and
56
63
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, this Declaration;
(b) the execution, delivery and performance by the
Delaware Trustee of this Declaration has been duly authorized by all necessary
corporate action on the part of the Delaware Trustee; and this Declaration has
been duly executed and delivered by the Delaware Trustee and under Delaware law
(excluding any securities laws) constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in
equity or at law);
(c) the execution, delivery and performance of this
Declaration by the Delaware Trustee does not conflict with or constitute a
breach of the charter or by-laws of the Delaware Trustee; and
(d) no consent, approval or authorization of, or
registration with or notice to, any federal or Delaware banking authority
governing the trust powers of the Delaware Trustee is required for the
execution, delivery or performance by the Delaware Trustee of this Declaration;
and
(e) the Delaware Trustee is a natural person who is a
resident of the State of Delaware or, if not a natural person, an entity which
has its principal place of business in the State of Delaware, and is a Person
that satisfies for the Trust Section 3807(a) of the Business Trust Act.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 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 first class mail, overnight courier service or
confirmed telecopy, as follows:
(a) if given to the Trust, in care of the Administrative
Trustees at the Trust's mailing address set forth below (or such other address
as the Trust may give notice of to the Property Trustee, the Delaware Trustee
and the Holders):
Hamilton Capital Trust I
c/o Hamilton Bancorp Inc.
3750 N.W. 87th Avenue
Miami, Florida 33178
Attn.: John M.R. Jacobs
Telephone: (305) 717-5620
Telecopier: (305) 717-5631
57
64
(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 Property Trustee and the Holders):
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attn.: Corporate Trust Administration
Telephone: (302) 651-1000
Telecopier: (302) 651-8882
(c) if given to the Property Trustee, at the Property
Trustee's mailing address set forth below (or such other address as the
Property Trustee may give notice of to the Delaware Trustee and the Holders):
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attn.: Corporate Trust Administration
Telephone: (302) 651-1000
Telecopier: (302) 651-8882
(d) if given to the Holder of the Common Securities, at
the mailing address of the Sponsor set forth below (or such other address as
the Holder of the Common Securities may give notice to the Trust):
Hamilton Bancorp Inc.
3750 N.W. 87th Avenue
Miami, Florida 33178
Attn.: John M.R. Jacobs
Telephone: (305) 717-5620
Telecopier: (305) 717-5631
(e) if given to any other Holder, at the address set
forth on the books and records of the Trust.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
58
65
SECTION 14.2 Governing Law.
This Declaration and the rights of the parties hereunder
shall be governed by and construed in accordance with the laws of the State of
Delaware without regard to conflict of laws principles thereof.
SECTION 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust
be classified for United States federal income tax purposes as a grantor trust
and that no election be made to have the Trust classified as an association
taxable as a corporation for United States federal income tax purposes. The
provisions of this Declaration shall be interpreted to further this intention of
the parties.
SECTION 14.4 Headings.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
SECTION 14.5 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 or not so expressed.
SECTION 14.6 Partial Enforceability.
If any provision of this Declaration, or the application
of such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to Persons
or circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 14.7 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 or more of such counterpart signature
pages. All of such counterpart signature pages shall be read as though one, and
they shall have the same force and effect as though all of the signers had
signed a single signature page.
59
66
IN WITNESS WHEREOF, the undersigned has caused these
presents to be executed as of the day and year first above written.
-----------------------------------
John M.R. Jacobs
as Administrative Trustee
-----------------------------------
Marilyn Alvarado
as Administrative Trustee
-----------------------------------
Lynn Hernandez
as Administrative Trustee
WILMINGTON TRUST COMPANY
as Delaware Trustee
By:
--------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY
as Property Trustee
By:
--------------------------------
Name:
Title:
HAMILTON BANCORP INC.,
as Sponsor and Debenture Issuer
By:
--------------------------------
Name:
Title:
67
ANNEX I
TERMS OF
[___%] CAPITAL SECURITIES, SERIES A
[___%] COMMON SECURITIES, SERIES A
Pursuant to Section 7.1 of the Amended and Restated
Declaration, dated as of December [__], 1998 (as amended from time to time, the
"Declaration"), the designation, rights, privileges, restrictions, preferences
and other terms and provisions of the Securities are set out below (each
capitalized term used but not defined herein has the meaning set forth in the
Declaration or, if not defined in such Declaration, as defined in the
Registration Statement referred to below):
1. Designation and Number.
(a) Series A Capital Securities. 1,265,000 Series A
Capital Securities of the Trust with an aggregate liquidation amount with
respect to the assets of the Trust of Twelve Million Six Hundred Fifty Thousand
Dollars ($12,650,000) and with a liquidation amount with respect to the assets
of the Trust of Ten Dollars ($10) (the "Liquidation Amount") per security, are
hereby designated for the purposes of identification only as "___% Capital
Securities, Series A" (the "Series A Capital Securities"). The certificates
evidencing the Series A Capital Securities shall be substantially in the form of
Exhibit A-1 to the Declaration, with such changes and additions thereto or
deletions therefrom as may be required by ordinary usage, custom or practice or
to conform to the rules of any exchange or quotation system on or in which the
Series A Capital Securities are listed, traded or quoted.
(b) Common Securities. 39,125 Series A Common Securities
of the Trust with an aggregate liquidation amount with respect to the assets of
the Trust of Three Hundred Ninety-One Thousand Two Hundred Fifty Dollars
($391,250) and a Liquidation Amount with respect to the assets of the Trust of
Ten Dollars ($10) per security, are hereby designated for the purposes of
identification only as "[___]% Common Securities, Series A" (the "Common
Securities"). The certificates evidencing the Common Securities shall be
substantially in the form of Exhibit A-2 to the Declaration, with such changes
and additions thereto or deletions therefrom as may be required by ordinary
usage, custom or practice.
2. Distributions.
(a) Distributions on each Security will be payable at a
fixed rate per annum of [___]% (the "Coupon Rate") of the liquidation amount of
$10 per Security, such rate being the rate of interest payable on the Series A
Debentures to be held by the Property Trustee. Distributions in arrears for
more than one quarterly period will bear additional Distributions thereon
compounded quarterly at the Coupon Rate (to the extent permitted by applicable
law). The term "Distributions," as used herein, includes distributions of any
and all such interest, if any, payable unless otherwise stated. A Distribution
is payable only to the extent that payments are made in respect of the Series A
Debentures held by the Property Trustee and to the extent the Property Trustee
has funds legally available therefor.
I-1
68
(b) Distributions on the Securities will be cumulative,
will accumulate from the most recent date to which Distributions have been paid
or, if no Distributions have been paid, from December [___], 1998 and will be
payable quarterly in arrears on March 31, June 30, September 30 and December 31
of each year, commencing March 31, 1999 (each, a "Distribution Date"), except
as otherwise described below. Distributions will be computed on the basis of a
360-day year consisting of twelve 30-day months. As long as no Event of Default
has occurred and is continuing under the Indenture, the Debenture Issuer has
the right under the Indenture to defer payments of interest by extending the
interest payment period at any time and from time to time on the Series A
Debentures for a period not exceeding 20 consecutive quarterly periods,
including the first such quarterly period during such period (each an
"Extension Period"), during which Extension Period no interest shall be due and
payable on the Series A Debentures, provided that no Extension Period shall end
on a date other than an Interest Payment Date for the Series A Debentures or
extend beyond the Maturity Date of the Series A Debentures. As a consequence of
such deferral, Distributions will also be deferred. Notwithstanding such
deferral, Distributions will continue to accumulate with additional
Distributions thereon (to the extent permitted by applicable law but not at a
rate greater than the rate at which interest is then accruing on the Series A
Debentures) at the Coupon Rate compounded quarterly during any such Extension
Period. Prior to the termination of any such Extension Period, the Debenture
Issuer may further defer payments of interest by further extending such
Extension Period, provided that such extension does not cause such Extension
Period, together with all such previous and further extensions within such
Extension Period, to exceed 20 consecutive quarterly periods, including the
first quarterly period during such Extension Period, end on a date other than
an Interest Payment Date for the Series A Debentures or extend beyond the
Maturity Date of the Series A Debentures. Upon the termination of any Extension
Period and the payment of all amounts then due, the Debenture Issuer may
commence a new Extension Period, subject to the above requirements.
(c) Distributions on the Securities will be payable to
the Holders thereof as they appear on the books and records of the Trust on the
close of business one Business Day prior to the relevant Distribution Date for
Capital Securities in book-entry form and the 15th day of the month in which
the relevant Distribution Date occurs for Capital Securities not in book-entry
form, which Distribution Dates correspond to the Interest Payment Dates for the
Series A Debentures. Subject to any applicable laws and regulations and the
provisions of the Declaration, each such payment in respect of the Capital
Securities will be made as described in the Prospectus, dated December [__],
1998 of the Debenture Issuer and the Trust relating to the Securities and the
Series A Debentures. The relevant record dates for the Common Securities shall
be the same as the record dates for the Capital Securities. Distributions
payable on any Securities that are not punctually paid on any Distribution
Date, as a result of the Debenture Issuer having failed to make a payment under
the Series A Debentures, will cease to be payable to the Holder on the relevant
record date, and such defaulted Distribution will instead be payable to the
Person in whose name such Securities are registered on the special record date
or other specified date determined in accordance with the Indenture. If any
date on which Distributions are payable on the Securities is not a Business
Day, then payment of the Distributions payable on such date will be made on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay), unless it would thereby fall in the next
calendar year, in which event such date will be the immediately preceding
Business Day with the same force and effect as if made on such date.
I-2
69
(d) Payments of Distributions (including Additional
Amounts, if applicable) in respect of the Series A Capital Securities shall be
made by check mailed to the address of the Person entitled thereto as such
address shall appear on the Securities Register or, if the Series A Capital
Securities are held by a Clearing Agency, such Distributions shall be made to
the Clearing Agency in immediately available funds, which shall credit the
relevant Persons' accounts at such Clearing Agency on the applicable
Distribution Dates. Payments in respect of the Common Securities shall be made
in such manner as shall be mutually agreed in writing between the Property
Trustee and the Common Security Holder.
(e) In the event that there is any money or other
property held by or for the Trust that is not accounted for hereunder, such
property shall be distributed Pro Rata (as defined herein) among the Holders.
3. Liquidation Distribution Upon Dissolution.
In the event of any dissolution of the Trust, the Trust shall
be liquidated by the Trustees as expeditiously as the Trustees determine to be
possible by distributing to the Holders, after satisfaction of liabilities to
creditors of the Trust as provided by applicable law, a Like Amount (as defined
below) of the Series A Debentures, unless such distribution is determined by
the Property Trustee not to be practicable, in which event such Holders will be
entitled to receive out of the assets of the Trust legally available for
distribution to Holders, after satisfaction of liabilities to creditors of the
Trust as provided by applicable law, an amount equal to the aggregate of the
liquidation amount of $10 per Security plus accumulated and unpaid
Distributions thereon to the date of payment (such amount being the
"Liquidation Distribution").
"Like Amount" means (i) with respect to a redemption of the
Securities, Securities having a Liquidation Amount equal to the principal
amount of Series A Debentures to be paid in accordance with their terms and
(ii) with respect to a distribution of Series A Debentures upon the liquidation
of the Trust, Series A Debentures having a principal amount equal to the
Liquidation Amount of the Securities of the Holder to whom such Series A
Debentures are distributed.
If, upon any such liquidation, the Liquidation Distribution
can be paid only in part because the Trust has insufficient assets legally
available to pay in full the aggregate Liquidation Distribution, then the
amounts payable directly by the Trust on the Securities shall be paid on a Pro
Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Series A Debentures in
whole or in part, at maturity or otherwise (either at the option of the
Debenture Issuer or pursuant to a Special Event, as described below), the
proceeds from such repayment shall be simultaneously applied by the Property
Trustee (subject to the Property Trustee having received written notice no
later than 45 days prior to such repayment) to redeem a Like Amount of the
Securities at a redemption price equal to 100% of the principal of and accrued
and unpaid interest on the Debentures being so paid or
I-3
70
redeemed (the "Redemption Price"). Holders will be given not less than 30 nor
more than 60 days prior written notice of such redemption.
(b) The Debenture Issuer shall have the right (subject to
the conditions in the Indenture) to elect to redeem the Series A Debentures, in
whole or in part, at any time on or after December __, 2008 (the "Initial
Optional Redemption Date"), and, simultaneous with such redemption, to cause a
Like Amount of the Securities to be redeemed by the Trust at the Redemption
Price on a Pro Rata basis.
(i) In the case of an optional redemption, if
fewer than all the outstanding Securities are to be so redeemed, the Common
Securities and the Capital Securities shall be redeemed Pro Rata, and the
Capital Securities to be redeemed will be determined as described in Section
4(f)(ii) below. Upon the entry of an order for the dissolution of the Trust by
a court of competent jurisdiction, the Series A Debentures thereafter will be
subject to optional redemption, in whole, but not in part, on or after the
Initial Optional Redemption Date.
(c) If at any time an Investment Company Event, a
Regulatory Capital Event or a Tax Event (each as defined below, and each a
"Special Event") occurs, the Debenture Issuer shall have the right (subject to
the conditions set forth in the Indenture) at any time prior to the Initial
Optional Redemption Date, to redeem the Series A Debentures in whole, but not
in part, within the 90 days following the occurrence of such Special Event (the
"90 Day Period"), and, simultaneous with such redemption, to cause a Like
Amount of the Securities to be redeemed by the Trust at the Redemption Price on
a Pro Rata basis.
"Investment Company Event" shall mean the receipt by the
Debenture Issuer and the Trust of an opinion of independent securities counsel
experienced in such matters to the effect that as a result of (a) any amendment
to, or change (including any announced prospective change) in, the laws or any
regulations thereunder of the United States or any rules, guidelines or
policies of any applicable regulatory authority for the Debenture Issuer or (b)
any official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of original
issuance of the Securities, the Trust is, or within 90 days of the date of such
opinion will be, considered an Investment Company that is required to be
registered under the Investment Company Act.
"Regulatory Capital Event" shall mean the receipt by the
Debenture Issuer and the Trust of an opinion of independent bank regulatory
counsel experienced in such matters to the effect that as a result of (a) any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any rules,
guidelines or policies of an applicable regulatory authority for the Debenture
Issuer or (b) any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement or decision is announced on or after the date
of original issuance of the Securities, the Capital Securities do not
constitute, or within 90 days of the date of such opinion will not constitute,
Tier 1 Capital (or its then equivalent if the Sponsor were subject to such
capital requirement); provided, however, that the distribution of the Series A
I-4
71
Debentures in connection with the liquidation of the Trust by the Debenture
Issuer shall not in and of itself constitute a Regulatory Capital Event.
"Tax Event" shall occur upon receipt by the Debenture Issuer
and the Trust of an opinion of independent tax counsel experienced in such
matters to the effect that, as a result of any amendment to, or change
(including any announced prospective change) in, the laws or any regulations
thereunder of the United States or any political subdivision or taxing
authority thereof or therein, or (b) any official administrative pronouncement
or judicial decision interpreting or applying such laws or regulations, which
amendment or change is effective or which pronouncement or decision is
announced on or after the date of original issuance of the Securities, there is
more than an insubstantial risk that (i) the Trust is, or will be within 90
days of the date of such opinion, subject to United States federal income tax
with respect to income received or accrued on the Series A Debentures, (ii) the
interest payable by the Debenture Issuer on the Series A 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 (iii) the Trust is, or will be within 90 days of the date of such
opinion, subject to more than a de minimis amount of other taxes, duties or
other governmental charges.
(d) On and from the date fixed by the Trustees for any
distribution of Debentures and liquidation of the Trust: (i) the Securities
will no longer be deemed to be outstanding, (ii) the Clearing Agency or its
nominee (or any successor Clearing Agency or its nominee), as the Holder of the
Capital Securities, will receive a registered global certificate or
certificates representing the Series A Debentures to be delivered upon such
distribution, and (iii) any certificates representing Securities not held by
the Clearing Agency or its nominee (or any successor Clearing Agency or its
nominee) will be deemed to represent beneficial interests in a Like Amount of
Series A Debentures until such certificates are presented to the Debenture
Issuer or its agent for transfer or reissue.
(e) The Trust may not redeem fewer than all the
outstanding Securities unless all accumulated and unpaid Distributions have
been paid on all Securities for all quarterly Distribution periods terminating
on or before the date of redemption.
(f) The procedure with respect to redemptions or
distributions of Securities shall be as follows:
(i) Notice of any redemption of, or notice of distribution of
Series A Debentures in exchange for, the Securities (a "Redemption/Distribution
Notice") will be given by the Trust by mail to each Holder to be redeemed or
exchanged not fewer than 30 nor more than 60 days before the date fixed for
redemption or exchange thereof which, in the case of a redemption, will be the
date fixed for redemption of the Series A Debentures. For purposes of the
calculation of the date of redemption or exchange and the dates on which
notices are given pursuant to this Section 4(f)(i), a Redemption/Distribution
Notice shall be deemed to be given on the day such notice is first mailed by
first-class mail, postage prepaid, to Holders. Each Redemption/Distribution
Notice shall be addressed to the Holders at the address of each such Holder
appearing in the books and records of the Trust. No defect in the
Redemption/Distribution Notice or in the mailing of either thereof with
I-5
72
respect to any Holder shall affect the validity of the redemption or exchange
proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding Securities
are to be redeemed, the particular Securities to be redeemed shall be selected
on a Pro Rata basis or by such other method (including, without limitation, by
lot) deemed fair and appropriate by the Property Trustee (based upon
Liquidation Amounts) not more than 60 nor less than 30 days prior to the date
fixed for redemption from the outstanding Securities not previously called for
redemption; provided, however, that any such redemption may be made on the
basis of the aggregate Liquidation Amount of Securities held by each Holder
thereof and may be made by making such adjustments as the Trust deems fair and
appropriate in order that fractional Securities shall not thereafter remain
outstanding. With respect to Capital Securities registered in the name of and
held of record by the Clearing Agency or its nominee (or any successor Clearing
Agency or its nominee) or any nominee, the distribution of the proceeds of such
redemption will be made to the Clearing Agency and disbursed by such Clearing
Agency in accordance with the procedures applied by such agency or nominee.
(iii) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice (which notice will be irrevocable), then (A)
with respect to Capital Securities issued in book-entry form, by 12:00 noon,
New York City time, on the redemption date, provided that the Debenture Issuer
has paid the Property Trustee a sufficient amount of cash in connection with
the related redemption or maturity of the Series A Debentures by 10:00 a.m.,
New York City time, on the Maturity Date or the date of redemption, as the case
requires, the Property Trustee will deposit irrevocably with the Clearing
Agency or its nominee (or successor Clearing Agency or its nominee) immediately
available funds sufficient to pay the applicable Redemption Price with respect
to such Capital Securities and will give the Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the relevant Clearing
Agency Participants, and (B) with respect to Capital Securities issued in
certificated form and Common Securities, provided that the Debenture Issuer has
paid the Property Trustee a sufficient amount of cash in connection with the
related redemption or maturity of the Series A Debentures, the Property Trustee
will irrevocably deposit with the paying agent for the Capital Securities (if
other than the Property Trustee) funds sufficient to pay the applicable
Redemption Price to the Holders by check mailed to the address of the relevant
Holder appearing on the books and records of the Trust on the redemption date,
and provided, further, that any such payment shall become due only upon
surrender by the Holder of the related certificated Capital Securities. If a
Redemption/ Distribution Notice shall have been given and funds deposited as
required, if applicable, then immediately prior to the close of business on the
date of such deposit, or on the redemption date, as applicable, Distributions
will cease to accumulate on the Securities so called for redemption and all
rights of Holders so called for redemption will cease, except the right of the
Holders of such Securities to receive the Redemption Price, but without
interest on such Redemption Price, and such Securities shall cease to be
outstanding.
(iv) Payment of accumulated and unpaid Distributions on the
Redemption Date of the Securities will be subject to the rights of Holders at
the close of business on a regular record date in respect of a Distribution
Date occurring on or prior to such Redemption Date.
I-6
73
Neither the Administrative Trustees nor the Trust shall be
required to register or cause to be registered the transfer of (i) any
Securities beginning at the opening of business 15 days before the day of
mailing of a notice of redemption or any notice of selection of Securities for
redemption or (ii) any Securities selected for redemption except the unredeemed
portion of any Security being redeemed. If any date fixed for redemption of
Securities is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment with respect to any such delay), unless it
would thereby fall in the next calender year, in which event such date will be
the immediately preceding Business Day with the same force and effect as if made
on such date. If payment of the Redemption Price with respect to any Securities
is improperly withheld or refused and not paid either by the Property Trustee or
by the Sponsor as guarantor pursuant to the relevant Securities Guarantee,
Distributions on such Securities will continue to accumulate from the original
redemption date to the actual date of payment, in which case the actual payment
date will be considered the date fixed for redemption for purposes of
calculating the Redemption Price.
(v) Redemption/Distribution Notices shall be sent by the Property
Trustee on behalf of the Trust to (A) with respect to Capital Securities issued
in book-entry form, the Clearing Agency or its nominee (or any successor
Clearing Agency or its nominee), (B) with respect to Capital Securities issued
in certificated form, to the Holders thereof, and (C) with respect to the
Common Securities, to the Holders thereof.
(vi) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities laws and banking laws),
the Sponsor or any of its subsidiaries may at any time and from time to time
purchase outstanding Capital Securities by tender, in the open market or by
private agreement.
5. Voting Rights - Capital Securities.
(a) Except as provided under Sections 5(b), 6(b) and 7
and as otherwise required by law and the Declaration, the Holders of the
Capital Securities will have no voting rights.
(b) So long as any Series A Debentures are held by the
Property Trustee, the Trustees shall not (i) direct the time, method and place
of conducting any proceeding for any remedy available to the Debenture Trustee
or executing any trust or power conferred on such Debenture Trustee with
respect to the Series A Debentures, (ii) waive any past default that is
waivable under Section 5.07 of the Indenture, (iii) exercise any right to
rescind or annul a declaration of acceleration of the maturity of the principal
of the Series A Debentures or (iv) consent to any amendment, modification or
termination of the Indenture or the Series A Debentures, where such consent
shall be required, without, in each case, obtaining the prior approval of the
Holders of a Majority in Liquidation Amount of all outstanding Capital
Securities; provided, however, that where a consent under the Indenture would
require the consent of each holder of Series A Debentures affected thereby, no
such consent shall be given by the Property Trustee without the prior approval
of each Holder of the Capital Securities. The Trustees shall not revoke any
action previously authorized or approved by a vote of the Holders of the
Capital Securities except by subsequent vote of such Holders. The Property
Trustee shall notify each Holder of Capital Securities of any notice of default
with respect to the Series A Debentures. In addition to obtaining the foregoing
approvals of such Holders of the Capital Securities, prior to taking any of the
foregoing actions, the Trustees shall
I-7
74
obtain an opinion of counsel experienced in such matters to the effect that the
Trust will continue not to be classified as an association taxable as a
corporation or be less likely to be classified as a grantor trust, in each case
for United States federal income tax purposes, after taking any such action
into account.
If an Event of Default under the Declaration has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or interest on the Series A Debentures on the due
date (or, in the case of redemption, on the redemption date), then a Holder of
Capital Securities may institute a proceeding directly against the Debenture
Issuer for enforcement of payment to such Holder of the principal of or
interest on a Like Amount of Series A Debentures (a "Direct Action") on or
after the respective due date specified in the Series A Debentures. In
connection with such Direct Action, the Common Securities Holder will be
subordinated to the rights of the Holders of Capital Securities to the extent
of any payment made by the Debenture Issuer to such Holder of Capital
Securities in such Direct Action. Except as provided in the second preceding
sentence, and, except as set forth in the first sentence of Section 3.8(e) of
the Declaration, the Holders of Capital Securities will not be able to exercise
directly any other remedy available to the holders of the Series A Debentures.
Any approval or direction of Holders of Capital Securities
may be given at a separate meeting of Holders of Capital Securities convened
for such purpose, at a meeting of all of the Holders of Securities in the Trust
or pursuant to written consent. The Property Trustee will cause a notice of any
meeting at which Holders of Capital Securities are entitled to vote to be
mailed to each Holder of record of Capital Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consent.
No vote or consent of the Holders of the Capital Securities
will be required for the Trust to redeem and cancel Capital Securities or to
distribute the Series A Debentures in accordance with the Declaration and the
terms of the Securities.
Notwithstanding that Holders of Capital Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Capital Securities that are owned by the Sponsor or any Affiliate of the
Sponsor shall not be entitled to vote or consent and shall, for purposes of
such vote or consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 6(b), 6(c) and 7 or
as otherwise required by law and the Declaration, the Holders of the Common
Securities will have no voting rights.
(b) Unless a Debenture Event of Default shall have
occurred and be continuing, any Trustee may be removed at any time by the
Holder of the Common Securities. If a Debenture Event of Default has occurred
and is continuing, the Property Trustee and the Delaware Trustee may
I-8
75
be removed at such time by the Holders of a Majority in Liquidation Amount of
the outstanding Capital Securities. In no event will the Holders of the Capital
Securities have the right to vote to appoint, remove or replace the
Administrative Trustees, which voting rights are vested exclusively in the
Sponsor as the Holder of the Common Securities. No resignation or removal of a
Trustee and no appointment of a successor trustee shall be effective until the
acceptance of appointment by the successor trustee in accordance with the
provisions of the Declaration.
(c) So long as any Series A Debentures are held by the
Property Trustee, the Trustees shall not (i) direct the time, method and place
of conducting any proceeding for any remedy available to the Debenture Trustee,
or executing any trust or power conferred on such Debenture Trustee with
respect to the Series A Debentures, (ii) waive any past default that is
waivable under Section 5.07 of the Indenture, (iii) exercise any right to
rescind or annul a declaration of acceleration of the maturity of the principal
of the Series A Debentures or (iv) consent to any amendment, modification or
termination of the Indenture or the Series A Debentures, where such consent
shall be required, without, in each case, obtaining the prior approval of the
Holders of a Majority in Liquidation Amount of all outstanding Common
Securities; provided, however, that where a consent under the Indenture would
require the consent of each holder of Series A Debentures affected thereby, no
such consent shall be given by the Property Trustee without the prior approval
of each Holder of the Common Securities. The Trustees shall not revoke any
action previously authorized or approved by a vote of the Holders of the Common
Securities except by subsequent vote of such Holders. The Property Trustee
shall notify each Holder of Common Securities of any notice of default with
respect to the Series A Debentures. In addition to obtaining the foregoing
approvals of such Holders of the Common Securities, prior to taking any of the
foregoing actions, the Trustees shall obtain an opinion of counsel experienced
in such matters to the effect that the Trust will continue not to be classified
as an association taxable as a corporation or to be less likely to be
classified as a grantor trust, in each case for United States federal income
tax purposes, after taking any such action into account.
If an Event of Default under the Declaration has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or interest on the Series A Debentures on the due
date (or in the case of redemption, on the redemption date), then a Holder of
Common Securities may institute a Direct Action directly against the Debenture
Issuer for enforcement of payment to such Holder of the principal of or
interest on a Like Amount of Series A Debentures on or after the respective due
date specified in the Series A Debentures. In connection with such Direct
Action, the rights of the Common Securities Holder will be subordinated to the
rights of the Holders of Capital Securities in respect of any payment from the
Debenture Issuer in such Direct Action. Except as provided in the second
preceding sentence, the Holders of Common Securities will not be able to
exercise directly any other remedy available to the holders of the Series A
Debentures.
Any approval or direction of Holders of Common Securities may
be given at a separate meeting of Holders of Common Securities convened for
such purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Administrative Trustees will cause a notice of
any meeting at which Holders of Common Securities are entitled to vote, or of
any matter upon which action by written consent of such Holders is to be taken,
to be mailed to
I-9
76
each Holder of record of Common Securities. Each such notice will include a
statement setting forth (i) the date of such meeting or the date by which such
action is to be taken, (ii) a description of any resolution proposed for
adoption at such meeting on which such Holders are entitled to vote or of such
matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities
will be required for the Trust to redeem and cancel Common Securities or to
distribute the Series A Debentures in accordance with the Declaration and the
terms of the Securities.
7. Amendments to Declaration.
In addition to the requirements set forth in Section 12.1 of
the Declaration, the Declaration may be amended from time to time by the
Sponsor, the Property Trustee and the Administrative Trustees without the
consent of the Holders (i) to cure any ambiguity, correct or supplement any
provisions in the Declaration that may be inconsistent with any other
provisions, or to make any other provisions with respect to matters or
questions arising under the Declaration which shall not be inconsistent with
the other provisions of the Declaration or (ii) to modify, eliminate or add to
any provisions of the Declaration to such extent as shall be necessary to
ensure that the Trust will not be classified as an association taxable as a
corporation and will not be less likely to be classified as a grantor trust, in
each case 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,
however, that in the case of an amendment pursuant to clause (i) above, such
action shall not adversely affect in any material respect the interests of any
Holder, and any such amendments of the Declaration shall become effective when
notice thereof is given to the Holders. The Declaration may also be amended by
the Trustees and the Sponsor with (i) the consent of Holders representing a
Majority in Liquidation Amount of all outstanding Securities, and (ii) receipt
by the Trustees of an Opinion of Counsel to the effect that such amendment or
the exercise of any power granted to the Trustees in accordance with such
amendment will not affect the Trust's status as not an association taxable as a
corporation or as a grantor trust for United States federal income tax purposes
or the Trust's exemption from status as an Investment Company under the
Investment Company Act; provided, however, that, without the consent of each
Holder of Trust Securities, the Declaration may not be amended to (i) change
the amount or timing of any Distribution on, or the payment required to be made
in respect of, the Trust Securities as of a specified date or (ii) restrict the
right of a Holder of Trust Securities to institute suit for the enforcement of
any such payment on or after such date.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each
Holder according to the aggregate liquidation amount of the Securities held by
such Holder in relation to the aggregate liquidation amount of all Securities
outstanding unless, in relation to a payment, an Event of Default under the
Declaration has occurred and is continuing, in which case any funds available
to make such payment shall be paid first to each Holder of the Capital
Securities pro rata according to the aggregate liquidation amount of Capital
I-10
77
Securities held by such Holder relative to the aggregate liquidation amount of
all Capital Securities outstanding and then, only after satisfaction of all
amounts owed to the Holders of the Capital Securities, to each Holder of Common
Securities pro rata according to the aggregate liquidation amount of Common
Securities held by such Holder relative to the aggregate liquidation amount of
all Common Securities outstanding.
9. Ranking.
The Capital Securities rank pari passu with the Common
Securities and payment thereon shall be made Pro Rata with the Common
Securities, except that, if an Event of Default under the Declaration occurs
and is continuing, no payments in respect of Distributions on, or payments upon
liquidation, redemption or otherwise with respect to, the Common Securities
shall be made until the Holders of the Capital Securities shall be paid in full
the Distributions, Redemption Price, Liquidation Distribution and any other
payments to which they are entitled at such time.
10. Acceptance of Capital Securities Guarantee, Common Securities
Guarantee. Indenture and Series A Debentures.
Each Holder of Capital Securities and Common Securities, by
the acceptance thereof, agrees to the provisions of the Capital Securities
Guarantee, the Common Securities Guarantee, the Indenture and the Series A
Debentures, as applicable, including the subordination provisions therein.
11. No Preemptive Rights.
Neither the issuance of Capital Securities nor the issuance
of Common Securities is subject to preemptive or other similar rights. The
Holders shall have no preemptive or similar rights to subscribe for any
additional securities.
12. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the
Capital Securities Guarantee or the Common Securities Guarantee, as applicable,
and the Indenture (including any supplemental indenture) to a Holder without
charge upon written request to the Trust at its principal place of business.
I-11
78
EXHIBIT A-1
FORM OF CAPITAL SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
[IF THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY,
INSERT: THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY WITHIN THE MEANING
OF THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY (THE "CLEARING AGENCY") OR A NOMINEE OF THE CLEARING
AGENCY. THIS CAPITAL SECURITY IS EXCHANGEABLE FOR CAPITAL SECURITIES REGISTERED
IN THE NAME OF A PERSON OTHER THAN THE CLEARING AGENCY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE DECLARATION, AND NO TRANSFER OF THIS
CAPITAL SECURITY (OTHER THAN A TRANSFER OF THIS CAPITAL SECURITY AS A WHOLE BY
THE CLEARING AGENCY TO A NOMINEE OF THE CLEARING AGENCY OR BY A NOMINEE OF THE
CLEARING AGENCY TO THE CLEARING AGENCY OR ANOTHER NOMINEE OF THE CLEARING
AGENCY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE CLEARING AGENCY TO THE TRUST OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CAPITAL SECURITY ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE CLEARING AGENCY AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO., 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.]
A1-1
79
Certificate Number: [_______________________] Aggregate Liquidation
Amount: $[____________________]
CUSIP Number:[____________________]
Certificate Evidencing Capital Securities
of
Hamilton Capital Trust I
[____]% Capital Securities, Series A
(liquidation amount $10 per Capital Security)
Hamilton Capital Trust I, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
[_________________] (the "Holder") is the registered owner of [$[_________] in
aggregate liquidation amount of Series A Capital Securities of the Trust]1 [the
aggregate liquidation amount of Series A Capital Securities of the Trust
specified in Schedule A hereto]2 representing undivided preferred beneficial
interests in the assets of the Trust designated the [________]% Capital
Securities, Series A (liquidation amount $10 per Capital Security) (the "Series
A Capital Securities"). The Series A Capital Securities are transferable on the
books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for
transfer. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Series A Capital Securities represented
hereby are issued and shall in all respects be subject to the provisions of the
Amended and Restated Declaration of the Trust, dated as of December
[______________], 1998, as the same may be amended from time to time (the
"Declaration"), including the designation of the terms of the Series A Capital
Securities as set forth in Annex I to the Declaration. Capitalized terms used
but not defined herein shall have the meaning given them in the Declaration.
The Sponsor will provide a copy of the Declaration, the Series A Capital
Securities Guarantee and the Indenture (including any supplemental indenture)
to a Holder without charge upon written request to the Trust at its principal
place of business.
Upon receipt of this Certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Series A Capital Securities Guarantee to the extent provided therein.
By acceptance hereof, the Holder agrees, for United States
federal income tax purposes, to treat the Series A Debentures as indebtedness
and the Capital Securities as evidence of indirect beneficial ownership in the
Series A Debentures.
- ----------------------------
(1) Insert in Definitive Capital Securities only.
(2) Insert in Global Capital Securities only.
A1-2
80
IN WITNESS WHEREOF, the Trust has executed this certificate
this [_______] day of [_______________ ____].
HAMILTON CAPITAL TRUST I
By:
-----------------------------------
Name:
Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the [_______]% Capital Securities, Series A of Hamilton
Capital Trust I referred to in the within-mentioned Declaration.
Dated: ____________________, ______
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely
as Property Trustee
By:
------------------------------------
Authorized Signatory
A1-3
81
[FORM OF REVERSE OF SECURITY]
Distributions on each Capital Security will be payable at a fixed rate
per annum of [___]% (the "Coupon Rate") of the liquidation amount of $10 per
Series A Capital Security, such rate being the rate of interest payable on the
Series A Debentures to be held by the Property Trustee. Distributions in
arrears for more than one quarterly period will bear interest thereon
compounded quarterly at the Coupon Rate (to the extent permitted by applicable
law). The term "Distributions," as used herein, includes such cash
distributions and any and all such interest, if any, payable unless otherwise
stated. A Distribution is payable only to the extent that payments are made in
respect of the Series A Debentures held by the Property Trustee and to the
extent the Property Trustee has funds legally available therefor.
Distributions on the Series A Capital Securities will be
cumulative, will accumulate from the most recent date to which Distributions
have been paid or, if no Distributions have been paid, from December [___],
1998 and will be payable quarterly in arrears, on March 31, June 30, September
30 and December 31 of each year, commencing March 31, 1999, except as otherwise
described below. Distributions will be computed on the basis of a 360-day year
consisting of twelve 30-day months. As long as no Event of Default has occurred
and is continuing under the Indenture, the Debenture Issuer has the right under
the Indenture to defer payments of interest by extending the interest payment
period at any time and from time to time on the Series A Debentures for a
period not exceeding 20 consecutive calendar quarterly periods, including the
first such quarterly period during such extension period (each an "Extension
Period"), provided that no Extension Period shall end on a date other than an
Interest Payment Date for the Series A Debentures or extend beyond the Maturity
Date of the Series A Debentures. As a consequence of such deferral,
Distributions will also be deferred. Notwithstanding such deferral, quarterly
Distributions will continue to accumulate with interest thereon (to the extent
permitted by applicable law, but not at a rate exceeding the rate of interest
then accruing on the Series A Debentures) at the Coupon Rate compounded
quarterly during any such Extension Period. Prior to the termination of any
Extension Period, the Debenture Issuer may further defer payments of interest
by further extending such Extension Period; provided that such Extension
Period, together with all such previous and further extensions within such
Extension Period, may not (i) exceed 20 consecutive quarterly periods,
including the first quarterly period during such Extension Period, (ii) end on
a date other than an Interest Payment Date for the Series A Debentures or (iii)
extend beyond the Maturity Date of the Series A Debentures. Payments of
accumulated Distributions will be payable to Holders as they appear on the
books and records of the Trust on the record date immediately preceding the end
of the Extension Period. Upon the termination of any Extension Period and the
payment of all amounts then due, the Debenture Issuer may commence a new
Extension Period, subject to the above requirements.
A1-4
82
Subject to receipt by the Sponsor of any and all required
regulatory approvals and to certain other conditions set forth in the
Declaration and the Indenture, the Property Trustee may, at the direction of
the Sponsor, at any time dissolve the Trust and, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, cause the
Series A Debentures to be distributed to the Holders of the Securities in
liquidation of the Trust or, simultaneously with any redemption of the Series A
Debentures, cause a Like Amount of the Securities to be redeemed by the Trust.
The Series A Capital Securities shall be redeemable as
provided in the Declaration.
A1-5
83
--------------
ASSIGNMENT
--------------
FOR VALUE RECEIVED, the undersigned hereby assigns and transfers this Capital
Security Certificate to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Assignee's social security or tax identification number)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Address and zip code of assignee)
and irrevocably appoints
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
agent to transfer this Capital Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date:
------------------------------
Signature:
------------------------------------------------------------------
(Sign exactly as your name appears on the other side of this Capital Security
Certificate)
Signature Guarantee:
----------------------------------------------------------
- ---------------------
Signature must be guaranteed by an "eligible guarantor institution"
that is a bank, stockbroker, savings and loan association or credit
union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer Agents
Medallion Program ("STAMP") or such other "signature guarantee
program" as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended.
A1-6
84
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAW. NEITHER THIS COMMON SECURITY NOR ANY INTEREST
OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS COMMON SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER THIS COMMON SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF
THE ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH HAMILTON BANCORP
INC. (THE "CORPORATION") OR ANY "AFFILIATE" OF THE CORPORATION WAS THE OWNER OF
THIS COMMON SECURITY (OR ANY PREDECESSOR OF THIS COMMON SECURITY) ONLY (A) TO
THE CORPORATION, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, OR (C) PURSUANT TO ANY OTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES
ACT, SUBJECT TO THE RIGHT OF HAMILTON CAPITAL TRUST I (THE "TRUST") AND THE
CORPORATION PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE
(D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS
AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND TO REQUIRE THAT THE
TRANSFEROR DELIVER TO THE TRUST A LETTER FROM THE TRANSFEREE. SUBSTANTIALLY TO
THE EFFECT THAT SUCH HOLDER FURTHER AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS COMMON SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.
A2-1
85
Certificate Evidencing Common Securities
of
Hamilton Capital Trust I
[____]%Common Securities, Series A
(liquidation amount $10 per Common Security)
Hamilton Capital Trust I, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
Hamilton Bancorp Inc. (the "Holder") is the registered owner of [__________]
Series A Common Securities of the Trust representing undivided beneficial
interests in the assets of the Trust designated the [____]% Common Securities,
Series A (liquidation amount $10 per Common Security) (the "Common Securities").
Subject to the terms of the Declaration (as defined below), the Common
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this Certificate duly endorsed
and in proper form for transfer. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Common
Securities represented hereby are issued and shall in all respects be subject to
the provisions of the Amended and Restated Declaration of the Trust dated as of
December [___], 1998, as the same may be amended from time to time (the
"Declaration"), including the designation of the terms of the Common Securities
as set forth in Annex I to the Declaration. Capitalized terms used but not
defined herein shall have the meaning given them in the Declaration. The Sponsor
will provide a copy of the Declaration, the Common Securities Guarantee and the
Indenture (including any supplemental indenture) to a Holder without charge upon
written request to the Trust at its principal place of business.
Upon receipt of this Certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Common Securities Guarantee to the extent provided therein.
By acceptance hereof, the Holder agrees to treat, for United
States federal income tax purposes, the Series A Debentures as indebtedness and
the Common Securities as evidence of indirect beneficial ownership in the
Series A Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate
this [__] day of [_____________] 1998.
HAMILTON CAPITAL TRUST I
By:
-------------------------------------
Name:
Administrative Trustee
A2-2
86
[FORM OF REVERSE OF SECURITY]
Distributions on each Common Security will be payable at a fixed rate
per annum of [___]% (the "Coupon Rate") of the liquidation amount of $10 per
Common Security, such rate being the rate of interest payable on the Series A
Debentures to be held by the Property Trustee. Distributions in arrears for
more than one quarterly period will bear interest thereon compounded quarterly
at the Coupon Rate (to the extent permitted by applicable law). The term
"Distributions," as used herein, includes such cash distributions and any and
all such interest payable unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Series A Debentures
held by the Property Trustee and to the extent the Property Trustee has funds
legally available therefor.
Distributions on the Common Securities will be cumulative, will accrue
from the most recent date to which Distributions have been paid or, if no
Distributions have been paid, from December [___], 1998 and will be payable
quarterly in arrears, on March 31, June 30, September 30 and December 31 of
each year, commencing March 31, 1999, except as otherwise described below.
Distributions will be computed on the basis of a 360-day year with twelve
months of 30 days each. As long as no Event of Default has occurred and is
continuing under the Indenture, the Debenture Issuer has the right under the
Indenture to defer payments of interest by extending the interest payment
period at any time and from time to time on the Series A Debentures for a
period not exceeding 20 consecutive calendar quarterly periods, including the
first such quarterly period during such extension period (each an "Extension
Period"), provided that no Extension Period shall end on a date other than an
Interest Payment Date for the Series A Debentures or extend beyond the Maturity
Date of the Series A Debentures. As a consequence of such deferral,
Distributions will also be deferred. Notwithstanding such deferral, quarterly
Distributions will continue to accumulate with interest thereon (to the extent
permitted by applicable law, but not at a rate exceeding the rate of interest
then accruing on the Series A Debentures) at the Coupon Rate compounded
quarterly during any such Extension Period. Prior to the termination of any
Extension Period, the Debenture Issuer may further defer payments of interest
by further extending such Extension Period; provided that such Extension
Period, together with all such previous and further extensions within such
Extension Period, may not (i) exceed 20 consecutive quarterly periods,
including the first quarterly period during such Extension Period, (ii) end on
a date other than an Interest Payment Date for the Series A Debentures or (iii)
extend beyond the Maturity Date of the Series A Debentures. Payments of accrued
Distributions will be payable to Holders as they appear on the books and
records of the Trust on the record date immediately preceding the end of the
Extension Period. Upon the termination of any Extension Period and the payment
of all amounts then due, the Debenture Issuer may commence a new Extension
Period, subject to the above requirements.
Subject to the receipt by the Sponsor of any and all required
regulatory approvals and to certain other conditions set forth in the
Declaration and the Indenture, the Property Trustee may, at the direction of
the Sponsor, at any time dissolve the Trust and cause the Series A Debentures
to be distributed to the Holders of the Securities in liquidation of the Trust
or, simultaneously with any redemption of the Series A Debentures, cause a Like
Amount of the Securities to be redeemed by the Trust.
The Common Securities shall be redeemable as provided in the
Declaration.
Under certain circumstances, the rights of the holders of the Common
Securities shall be subordinate to the rights of the holders of the Capital
Securities, as provided in the Declaration.
A2-3