TRUST AGREEMENT
AMONG
GENTIVA HEALTH SERVICES, INC., AS DEPOSITOR
WILMINGTON TRUST COMPANY
AS PROPERTY TRUSTEE AND
AS DELAWARE TRUSTEE,
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN,
AND
THE SEVERAL HOLDERS (AS DEFINED HEREIN)
DATED AS OF MARCH 9, 2000
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the Trust Indenture Act of 1939:
Trust
Trust Act Section Agreement Section
- -------------------------------------------------- -------------------------
(Section) 310 (a)(1).............................. 8.7
(a)(2)........................... 8.7
(a)(3)........................... 8.9
(a)(4)........................... 2.7(a)(ii)
(b).............................. 8.8
(Section) 311 (a)................................. 8.13
(b).............................. 8.13
(Section) 312 (a)................................. 5.7
(b).............................. 5.7
(c).............................. 5.7
(Section) 313 (a)................................. 8.14(a)
(a)(4)........................... 8.14(b)
(b).............................. 8.14(b)
(c).............................. 10.9
(d).............................. 8.14(c)
(Section) 314 (a)................................. 8.15
(b).............................. Not Applicable
(c)(1)........................... 8.16
(c)(2)........................... 8.16
(c)(3)........................... Not Applicable
(d).............................. Not Applicable
(e).............................. 1.1, 8.16
(Section) 315 (a)................................. 8.1(a), 8.3(a)
(b).............................. 8.2, 10.9
(c).............................. 8.1(a)
(d).............................. 8.1, 8.3
(e).............................. Not Applicable
(Section) 316 (a)................................. Not Applicable
(a)(1)(A)........................ Not Applicable
(a)(1)(B)........................ Not Applicable
(a)(2)........................... Not Applicable
(b).............................. 5.14
(c).............................. 6.7
(Section) 317 (a)(1).............................. Not Applicable
(a)(2)........................... Not Applicable
(b).............................. 5.9
(Section) 318 (a)................................. 10.11
Note: This reconciliation and tie sheet shall not, for any purpose, be deemed to
be a part of the Trust Agreement.
TABLE OF CONTENTS
Page
ARTICLE I
DEFINED TERMS
SECTION 1.1. DEFINITIONS...................................................1
ARTICLE II
CONTINUATION OF TRUST
SECTION 2.1. NAME.........................................................11
SECTION 2.2. OFFICE OF DELAWARE TRUSTEE; PRINCIPAL PLACE OF BUSINESS......11
SECTION 2.3. INITIAL CONTRIBUTION OF TRUST PROPERTY;
ORGANIZATIONAL EXPENSES....................................12
SECTION 2.4. ISSUANCE OF PREFERRED SECURITIES.............................12
SECTION 2.5. ISSUANCE OF COMMON SECURITIES................................12
SECTION 2.6. SUBSCRIPTION AND PURCHASE OF DEBENTURES......................12
SECTION 2.7. DECLARATION OF TRUST.........................................13
SECTION 2.8. AUTHORIZATION TO ENTER INTO CERTAIN TRANSACTIONS.............13
SECTION 2.9. ASSETS OF TRUST..............................................17
SECTION 2.10. TITLE TO TRUST PROPERTY......................................17
ARTICLE III
PAYMENT ACCOUNT
SECTION 3.1. PAYMENT ACCOUNT..............................................17
ARTICLE IV
DISTRIBUTIONS; REDEMPTION; CONVERSION
SECTION 4.1. DISTRIBUTIONS................................................18
SECTION 4.2. REDEMPTION...................................................19
SECTION 4.3. CONVERSION...................................................21
SECTION 4.4. SUBORDINATION OF COMMON SECURITIES...........................25
SECTION 4.5. PAYMENT PROCEDURES...........................................26
SECTION 4.6. TAX RETURNS AND REPORTS......................................26
SECTION 4.7. PAYMENT OF EXPENSES OF TRUST.................................26
- -ii-
Page
SECTION 4.8. PAYMENTS UNDER INDENTURE OR PURSUANT TO DIRECT ACTIONS.......26
ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 5.1. INITIAL OWNERSHIP............................................27
SECTION 5.2. TRUST SECURITIES CERTIFICATES................................27
SECTION 5.3. EXECUTION AND DELIVERY OF TRUST SECURITIES CERTIFICATES......27
SECTION 5.4. REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED
SECURITIES.................................................28
SECTION 5.5. TRANSFER OF CERTIFICATES.....................................31
SECTION 5.6. DEEMED HOLDERS...............................................32
SECTION 5.7. ACCESS TO LIST OF HOLDERS' NAMES AND ADDRESSES...............32
SECTION 5.8. MAINTENANCE OF OFFICE OR AGENCY..............................32
SECTION 5.9. APPOINTMENT OF PAYING AGENT..................................33
SECTION 5.10. APPOINTMENT OF CONVERSION AGENT..............................33
SECTION 5.11. OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR..................34
SECTION 5.12. MUTILATED, DESTROYED, LOST OR STOLEN TRUST SECURITIES
CERTIFICATES...............................................35
SECTION 5.13. RIGHTS OF HOLDERS............................................35
ARTICLE VI
ACTS OF HOLDERS; MEETINGS; VOTING
SECTION 6.1. LIMITATIONS ON VOTING RIGHTS.................................38
SECTION 6.2. NOTICE OF MEETINGS...........................................39
SECTION 6.3. MEETINGS OF HOLDERS..........................................39
SECTION 6.4. VOTING RIGHTS................................................40
SECTION 6.5. PROXIES, ETC.................................................40
SECTION 6.6. HOLDER ACTION BY WRITTEN CONSENT.............................40
SECTION 6.7. RECORD DATE FOR VOTING AND OTHER PURPOSES....................41
SECTION 6.8. ACTS OF HOLDERS..............................................41
SECTION 6.9. INSPECTION OF RECORDS........................................42
-iii-
Page
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. REPRESENTATIONS AND WARRANTIES OF PROPERTY TRUSTEE AND
DELAWARE TRUSTEE...........................................42
ARTICLE VIII
THE TRUSTEES
SECTION 8.1. CERTAIN DUTIES AND RESPONSIBILITIES..........................44
SECTION 8.2. CERTAIN NOTICES..............................................45
SECTION 8.3. CERTAIN RIGHTS OF PROPERTY TRUSTEE...........................46
SECTION 8.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.......48
SECTION 8.5. MAY HOLD SECURITIES..........................................49
SECTION 8.6. COMPENSATION; INDEMNITY; FEES................................49
SECTION 8.7. CORPORATE PROPERTY TRUSTEE REQUIRED; ELIGIBILITY OF
TRUSTEES...................................................50
SECTION 8.8. CONFLICTING INTERESTS........................................51
SECTION 8.9. CO-TRUSTEES AND SEPARATE TRUSTEE.............................51
SECTION 8.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR............53
SECTION 8.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.......................54
SECTION 8.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS...................................................55
SECTION 8.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR OR
TRUST......................................................55
SECTION 8.14. REPORTS BY PROPERTY TRUSTEE..................................56
SECTION 8.15. REPORTS TO PROPERTY TRUSTEE..................................56
SECTION 8.16. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.............57
SECTION 8.17. NUMBER OF TRUSTEES...........................................57
SECTION 8.18. DELEGATION OF POWER..........................................57
ARTICLE IX
DISSOLUTION, LIQUIDATION, TERMINATION AND MERGER
SECTION 9.1. TERMINATION UPON EXPIRATION DATE............................58
SECTION 9.2. EARLY TERMINATION...........................................58
-iv-
Page
SECTION 9.3. TERMINATION.................................................59
SECTION 9.4. LIQUIDATION.................................................59
SECTION 9.5. MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS
OF TRUST..................................................61
ARTICLE X
RIGHT TO REQUIRE REPURCHASE
SECTION 10.1. RIGHT TO REQUIRE REPURCHASE.................................62
SECTION 10.2. NOTICE; METHOD OF EXERCISING REPURCHASE RIGHT...............62
SECTION 10.3. DEPOSIT OF REPURCHASE PRICE.................................63
SECTION 10.4. SECURITIES NOT REPURCHASED ON REPURCHASE DATE...............64
SECTION 10.5. SECURITIES REPURCHASED IN PART..............................64
SECTION 10.6. DEFINITIONS.................................................64
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1. LIMITATION OF RIGHTS OF HOLDERS.............................65
SECTION 11.2. LIABILITY...................................................65
SECTION 11.3. AMENDMENT...................................................66
SECTION 11.4. SEPARABILITY................................................67
SECTION 11.5. GOVERNING LAW...............................................67
SECTION 11.6. PAYMENTS DUE ON NON-BUSINESS DAY............................67
SECTION 11.7. SUCCESSORS..................................................68
SECTION 11.8. HEADINGS....................................................68
SECTION 11.9. REPORTS, NOTICES AND DEMANDS................................68
SECTION 11.10. AGREEMENT NOT TO PETITION...................................69
SECTION 11.11. TRUST INDENTURE ACT; CONFLICT WITH TRUST INDENTURE ACT......69
SECTION 11.12. ACCEPTANCE OF TERMS OF TRUST AGREEMENT, GUARANTEE AND
INDENTURE.................................................70
SECTION 11.13. HOLDERS ARE PARTIES.........................................70
SECTION 11.14. COUNTERPARTS................................................70
-v-
TRUST AGREEMENT
THIS TRUST AGREEMENT (this "Trust Agreement"), dated as of March 9, 2000
among (i) GENTIVA HEALTH SERVICES, INC., a Delaware corporation (including any
successors or assigns, the "Depositor"), (ii) Wilmington Trust Company, as
property trustee (in such capacity, the "Property Trustee" and, in its separate
corporate capacity and not in its capacity as Property Trustee, the "Bank") and
as Delaware trustee (the "Delaware Trustee"), (iii) Edward A. Blechshmidt, an
individual, John J. Collura, an individual, and Patricia C. Ma, an individual,
each of whose address is c/o Gentiva Health Services, Inc., 175 Broad Hollow
Road, Melville, New York 11747 (each an "Administrative Trustee" and
collectively the "Administrative Trustees") (the Property Trustee, the Delaware
Trustee and the Administrative Trustees are referred to individually as a
"Trustee" and collectively as the "Trustees") and (iv) the several Holders (as
hereinafter defined).
W I T N E S S E T H:
WHEREAS, THE DEPOSITOR AND CERTAIN OF THE TRUSTEES HAVE DULY DECLARED AND
ESTABLISHED A BUSINESS TRUST PURSUANT TO THE DELAWARE BUSINESS TRUST ACT BY
ENTERING INTO THIS TRUST AGREEMENT, DATED AS OF MARCH 9, 2000 AND BY THE
EXECUTION AND FILING WITH THE SECRETARY OF STATE OF THE STATE OF DELAWARE OF THE
CERTIFICATE OF TRUST, FILED ON MARCH 9, 2000, ATTACHED AS EXHIBIT A (THE
"CERTIFICATE OF TRUST"). NOW, THEREFORE, IN CONSIDERATION OF THE AGREEMENTS AND
OBLIGATIONS SET FORTH HEREIN AND FOR OTHER GOOD AND VALUABLE CONSIDERATION, THE
SUFFICIENCY OF WHICH IS HEREBY ACKNOWLEDGED, EACH PARTY, FOR THE BENEFIT OF THE
OTHER PARTIES AND FOR THE BENEFIT OF THE HOLDERS (AS HEREINAFTER DEFINED),
HEREBY AGREES AS FOLLOWS:
ARTICLE I
DEFINED TERMS
SECTION 1.1. DEFINITIONS.
For all purposes of this Trust Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust
Indenture Act (as hereinafter defined), either directly or by reference
therein, have the meanings assigned to them therein;
(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Trust Agreement; and
(d) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.8(a).
"Additional Amount" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, the amount of Additional Interest (as
defined in the Indenture) paid by the Depositor on a Like Amount of Debentures
for such period.
"Administrative Trustee" means each of the individuals identified as an
"Administrative Trustee" in the preamble to this Trust Agreement, solely in such
individual's capacity as an Administrative Trustee of the Trust and not in such
individual's individual capacity, or such Administrative Trustee's successor in
interest in such capacity, and includes any Special Administrative Trustee (as
hereinafter defined) appointed as herein provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Appointment Event" has the meaning set forth in Section 6.1(d).
"Bank" has the meaning specified in the preamble to this Trust Agreement.
"BHCA Person" has the meaning set forth in Section 4.3(a).
"Bankruptcy Event" means, with respect to any Person:
-2-
(a) the entry of a decree or order by a court having jurisdiction in
the premises judging such Person a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjudication
or composition of or in respect of such Person under any applicable federal
or state bankruptcy, insolvency, reorganization or other similar law, or
appointing a receiver, liquidator, assignee, trustee, sequestrator (or
other similar official) of such Person or of any substantial part of its
property or ordering the winding up or liquidation of its affairs, and the
continuance of any such decree or order unstayed and in effect for a period
of 60 consecutive days; or
(b) the institution by such Person of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it of a
petition or answer or consent seeking reorganization or relief under any
applicable federal or state bankruptcy, insolvency, reorganization or other
similar law, or the consent by it to the filing of any such petition or to
the appointment of a receiver, liquidator, assignee, trustee, sequestrator
(or similar official) of such Person or of any substantial part of its
property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its
debts generally as they become due and its willingness to be adjudicated a
bankrupt, or the taking of corporate action by such Person in furtherance
of any such action.
"Bankruptcy Laws" has the meaning specified in Section 11.10.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Depositor to have been duly adopted by the
Depositor's Board of Directors, or such committee of the Board of Directors or
officers of the Depositor to which authority to act on behalf of the Board of
Directors has been delegated, and to be in full force and effect on the date of
such certification, and delivered to the Trustees.
"Business Day" means a day other than (i) a Saturday or Sunday and (ii) a
day on which banking institutions in The City of New York or the State of
Delaware are authorized or required by law or executive order to remain closed.
"Certificate of Trust" has the meaning specified in the recitals hereof, as
amended from time to time.
"Certificated Preferred Security" or "Certificated Preferred Securities"
means a Preferred Security or Securities in the form set forth in Exhibit C
attached hereto.
"Closing Date" means March 15, 2000.
-3-
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Securities Certificate" means a certificate evidencing ownership of
Common Securities, substantially in the form attached as Exhibit B.
"Common Security" means an undivided common beneficial interest in the
assets of the Trust, having a Liquidation Amount of $50 and having the rights
provided therefor in this Trust Agreement, including the right to convert to
shares of the Common Stock and the right to receive Distributions and a
Liquidation Distribution as provided herein.
"Common Stock" means the common stock of the Depositor, par value $.10 per
share.
"Conversion Agent" has the meaning set forth in Section 4.3(d).
"Conversion Date" has the meaning set forth in Section 4.3(c).
"Conversion Price" has the meaning set forth in Section 4.3(a).
"Conversion Request" has the meaning set forth in Section 4.3(b).
"Corporate Trust Office" means (i) when used with respect to the Property
Trustee, the principal office of the Property Trustee located in Wilmington,
Delaware, and (ii) when used with respect to the Indenture Trustee, the
principal office of the Indenture Trustee located in Wilmington, Delaware.
"Debenture Purchase Agreement" means the purchase agreement between the
Trust and the Depositor relating to the purchase by the Trust of the Depositor's
Debentures and dated as of the Closing Date.
"Debenture Redemption Date" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption under the Indenture.
"Debenture Stated Maturity" means the date specified pursuant to the terms
of the Debentures as the date on which the principal of the Debentures is due
and payable.
"Debenture Tax Event" means a "Tax Event" as defined in the Indenture.
-4-
"Debentures" means the $20,618,600 aggregate principal amount of the
Depositor's 10% Convertible Subordinated Debentures due 2005 issued pursuant to
the Indenture.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. 3801, et seq., as it may be amended from time to time.
"Delaware Trustee" means the Person identified as the "Delaware Trustee" in
the preamble to this Trust Agreement solely in its capacity as Delaware Trustee
of the Trust and not in its individual capacity, or its successor in interest in
such capacity, or any successor trustee appointed as herein provided.
"Depositor" has the meaning specified in the preamble to this Trust
Agreement.
"Direct Action" has the meaning specified in Section 5.13(f).
"Distribution Date" has the meaning specified in Section 4.1(a).
"Distributions" has the meaning specified in Section 4.1(a).
"Early Termination Event" has the meaning specified in Section 9.2.
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of a Indenture Event of Default; or
(b) default by the Property Trustee in the payment of any Distribution
when it becomes due and payable, and continuation of such default for a
period of 30 days; provided, however, that a valid extension of the
interest payment period by the Depositor pursuant to Section 3.11 of the
Indenture shall not constitute a default in the payment of Distributions);
or
(c) default by the Property Trustee in the payment of any Redemption
Price or Repurchase Price of any Trust Security when it becomes due and
payable; or
(d) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Trustees in this Trust Agreement (other
than a covenant or warranty a default in the performance or breach of which
is dealt with in clause (b) or (c) above) and continuation of such default
or breach for a period of 90 days after there
-5-
has been given, by registered or certified mail, to the defaulting Trustee
or Trustees by the Holders of at least 25% in aggregate Liquidation Amount
of the Outstanding Preferred Securities, a written notice specifying such
default or breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and the failure by the Depositor to appoint a successor Property
Trustee within 90 days thereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Expiration Date" has the meaning specified in Section 9.1.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Depositor and Wilmington Trust Company, as trustee, on the Closing Date, for the
benefit of the Holders of the Preferred Securities, as amended from time to
time.
"Holder" means a Person in whose name a Trust Security is registered in the
Securities Register; any such Person shall be a beneficial owner within the
meaning of the Delaware Business Trust Act.
"Indenture" means the Indenture, dated as of March 15, 2000 between the
Depositor and the Indenture Trustee, as trustee, as amended or supplemented from
time to time.
"Indenture Event of Default" means an "Event of Default" as defined in the
Indenture.
"Indenture Trustee" means Wilmington Trust Company, a Delaware corporation,
as trustee under the Indenture, and any successor trustee appointed as provided
therein.
"Investment Company Event" means that the Administrative Trustees shall
have received an opinion from independent counsel to the effect that, as a
result of the occurrence of a change in law or regulation or a written change in
interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority (a "Change in 1940 Act Law"),
there is more than an insubstantial risk that the Trust is or will be considered
an "investment company" which is required to be registered under the Investment
Company Act of 1940, as amended, which Change in 1940 Act Law becomes effective
on or after the date hereof.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
-6-
"Like Amount" means (a) with respect to a redemption or repurchase of Trust
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Debentures to be contemporaneously redeemed or repurchased in
accordance with the Indenture, the proceeds of which will be used to pay the
Redemption Price or Repurchase Price of such Trust Securities and (b) with
respect to a distribution of Debentures to Holders of Trust Securities in
connection with a dissolution or liquidation of the Trust, Debentures having a
principal amount equal to the Liquidation Amount of the Trust Securities of the
Holder to whom such Debentures are distributed.
"Liquidation Amount" means the stated amount of $50 per Trust Security.
"Liquidation Date" means the date on which Debentures are to be distributed
to Holders of Trust Securities in connection with a termination and liquidation
of the Trust pursuant to Section 9.4(a).
"Liquidation Distribution" has the meaning specified in Section 9.4(d).
"1940 Act" means the Investment Company Act of 1940, as amended.
"Officers' Certificate" means a certificate signed by the Chairman, Chief
Executive Officer, President or a Vice President, and by the Treasurer, an
Assistant Treasurer, the Controller, the Secretary or an Assistant Secretary, of
the Depositor, and delivered to the appropriate Trustee. One of the officers
signing an Officers' Certificate given pursuant to Section 8.16 shall be the
principal executive, financial or accounting officer of the Depositor. Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
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, in the opinion of each such officer,
such condition or covenant has been complied with.
-7-
"Opinion of Counsel" means a written opinion of counsel, who may be
internal or external counsel for the Trust, the Property Trustee or the
Depositor, and who shall be reasonably acceptable to the Property Trustee.
"Outstanding" means, when used with respect to Trust Securities as of the
date of determination, all Trust Securities theretofore executed and delivered
under this Trust Agreement, except:
(a) Trust Securities theretofore canceled by the Securities Registrar
or delivered to the Securities Registrar for cancellation;
(b) Trust Securities for whose payment or redemption funds in the
necessary amount theretofore have been deposited with the Property Trustee
or any Paying Agent for the Holders of such Trust Securities; provided
that, if such Trust Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Trust Agreement;
(c) Trust Securities which have been converted pursuant to Section
4.3; and
(d) Trust Securities which have been paid or in exchange for or in
lieu of which other Trust Securities have been executed and delivered
pursuant to this Trust Agreement, including pursuant to Sections 5.4, 5.5,
5.11 and 5.16.
"Owner" means each Person who is the beneficial owner of a Certificated
Preferred Security.
"Paying Agent" means any paying agent or co-paying agent appointed pursuant
to Section 5.9 and initially shall be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate trust
account maintained by the Property Trustee with the Bank in its corporate trust
department for the benefit of the Holders in which all amounts paid in respect
of the Debentures will be held and from which the Property Trustee, through the
Paying Agent, shall make payments to the Holders in accordance with Sections 4.1
and 4.2 and Article X.
"Person" means any individual, corporation, partnership, joint venture,
trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Security" means an undivided preferred beneficial interest in
the assets of the Trust, having a Liquidation Amount of $50 and having the
rights provided therefor
-8-
in this Trust Agreement, including the right to convert to shares of the Common
Stock and the right to receive Distributions and a Liquidation Distribution as
provided herein.
"Property Trustee" means the Person identified as the "Property Trustee" in
the preamble to this Trust Agreement solely in its capacity as Property Trustee
of the Trust and not in its individual capacity, or its successor in interest in
such capacity, or any successor property trustee appointed as herein provided.
"Purchase Agreement" means the Purchase Agreement, dated as of March 13,
2000, among the Trust, the Depositor and the Purchasers named therein.
"Purchasers" means the individuals named in the Purchase Agreement.
"Redemption Date" means, with respect to any Trust Security to be redeemed,
the date fixed for such redemption by or pursuant to this Trust Agreement;
provided that each Debenture Redemption Date and the Debenture Stated Maturity
shall be a Redemption Date for a Like Amount of Trust Securities.
"Redemption Price" means, with respect to any Trust Security, the
redemption price paid by the Depositor upon the concurrent redemption of a Like
Amount of Debentures, allocated on a pro rata basis (based on Liquidation
Amounts) among the Trust Securities.
"Regulation S" means Regulation S under the Securities Act.
"Relevant Trustee" shall have the meaning specified in Section 8.10(a).
"Repurchase Date" shall have the meaning specified in Section 10.1
"Repurchase Price" shall have the meaning specified in Section 10.1
"Resale Restriction Termination Date" means, with respect to any Preferred
Security, the later of the date which is two years after (i) the original issue
date of such Preferred Security and (ii) the last date on which the Depositor or
an Affiliate of the Depositor was the owner of such Preferred Security (or any
predecessor Trust Security).
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Register" shall have the meaning specified in Section 5.5.
"Securities Registrar" shall have the meaning specified in Section 5.5.
-9-
"Special Administrative Trustee" means an Administrative Trustee appointed
by the Holders of the Preferred Securities pursuant to the provisions of Section
6.1(d).
"Special Event" means an Investment Company Event or a Tax Event.
"Split-off" means the date of the issuance of all Common Stock of the
Depositor to stockholders of Olsten Corporation ("Olsten") in exchange for their
Olsten stock and the separation of the Depositor from its parent company,
Olsten, to become a separate publicly-traded company, pursuant to the separation
agreement, as amended, dated August 17, 1999 by and among Olsten, Adecco SA and
Aaronco Corp. (predecessor to the Depositor).
"Subscription Agreement" means the subscription agreement between the Trust
and the Depositor relating to the issuance by the Trust of the Common Securities
to the Depositor and dated as of the Closing Date.
"Tax Event" means the receipt by the Trust of an Opinion of 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 political subdivision or
taxing authority thereof or therein or (b) any amendment to, or change in, an
interpretation or application of such laws or regulations, there is more than an
insubstantial risk that (i) the Trust would be subject to United States federal
income tax with respect to income accrued or received on the Convertible
Subordinated Debentures, (ii) interest payable to the Trust on the Convertible
Subordinated Debentures would not be deductible, in whole or in part, by the
Depositor for United States federal income tax purposes or (iii) the Trust would
be subject to more than a de minimis amount of other taxes, duties or other
governmental charges, which change or amendment becomes effective on or after
the date hereof.
"Trading Day" means each Monday, Tuesday, Wednesday, Thursday and Friday,
other than any day on which securities are generally not traded on the
applicable securities exchange or in the relevant market.
"Transfer Restricted Securities" means Preferred Securities that bear or
are required to bear the legend set forth in Section 5.4(e).
"Trust" means the Delaware business trust created and identified on the
cover page to this Trust Agreement.
"Trust Agreement" means this Trust Agreement, as the same may be modified,
amended or supplemented in accordance with the applicable provisions hereof,
including (i) all exhibits hereto and (ii) for all purposes of this Trust
Agreement and any such modifica-
-10-
tion, amendment or supplement, the provisions of the Trust Indenture Act that
are deemed to be a part of and govern this Trust Agreement and any such
modification, amendment or supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Debentures, (b) any funds on deposit in, or
owing to, the Payment Account and (c) all proceeds and rights in respect of the
foregoing.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Certificated Preferred Securities.
"Trust Security" means any of the Common Securities and the Preferred
Securities.
"Trustees" means, collectively, the Property Trustee, the Delaware Trustee
and the Administrative Trustees.
ARTICLE II
CONTINUATION OF TRUST
SECTION 2.1. NAME.
The Trust hereby shall be known as "Gentiva Trust," as such name may be
modified from time to time by the Administrative Trustees following written
notice to the Holders and the other Trustees, in which name the Trustees engage
in the transactions contemplated hereby, make and execute contracts and other
instruments on behalf of the Trust and sue and be sued.
SECTION 2.2. OFFICE OF DELAWARE TRUSTEE; PRINCIPAL PLACE OF BUSINESS.
The address of the Delaware Trustee in the State of Delaware is Wilmington
Trust Company, 1100 North Market Street, Wilmington, Delaware 19801, Attention:
Corporate Trust Department, or such other address in the State of Delaware as
the Delaware Trustee may designate by written notice to the Holders and the
Depositor. The principal executive
-11-
office of the Trust is c/o Gentiva Health Services, Inc., 175 Broad Hollow Road,
Melville, New York 11747.
SECTION 2.3. INITIAL CONTRIBUTION OF TRUST PROPERTY; ORGANIZATIONAL
EXPENSES.
The Property Trustee acknowledges receipt in trust from the Depositor of
the sum of $10, which constitutes the initial Trust Property. The Depositor will
pay organizational expenses of the Trust as they arise or, upon request of any
Trustee, promptly will reimburse such Trustee for any such expenses paid by such
Trustee. The Depositor will make no claim upon the Trust Property for the
payment of such expenses.
SECTION 2.4. ISSUANCE OF PREFERRED SECURITIES.
As of March 13, 2000, the Depositor, the Trust and the Purchasers will
execute and deliver the Purchase Agreement. On March 15, 2000, an Administrative
Trustee, on behalf of the Trust, will execute in accordance with Section 5.2 and
deliver to the Purchasers named in the Purchase Agreement the Certificated
Preferred Securities, registered in the name of the Purchasers, in the amount of
400,000 Preferred Securities having an aggregate Liquidation Amount of $50.00,
against receipt of an aggregate purchase price of $20,000,000, plus accrued
Distributions from March 15, 2000, if any.
SECTION 2.5. ISSUANCE OF COMMON SECURITIES.
On March 15, 2000, an Administrative Trustee, on behalf of the Trust, will
execute in accordance with Section 5.2 and deliver to the Depositor Common
Securities Certificates, registered in the name of the Depositor, in accordance
with the Subscription Agreement in an aggregate amount of 12,371 Common
Securities having an aggregate Liquidation Amount of $50.00 against payment by
the Depositor of an aggregate purchase price of $618,600, plus accrued
Distributions from March 15, 2000, if any.
SECTION 2.6. SUBSCRIPTION AND PURCHASE OF DEBENTURES.
Contemporaneously with the issuance of Preferred Securities and Common
Securities pursuant to Section 2.4(a) and Section 2.5(a), an Administrative
Trustee, on behalf of the Trust, will subscribe to and purchase from the
Depositor Debentures registered in the name of the Trust and having an aggregate
principal amount equal to $20,618,600 in accordance with the Debenture Purchase
Agreement. In satisfaction of the purchase price for such Debentures, the Trust
will deliver to the Depositor the sum of $20,618,600.
-12-
SECTION 2.7. DECLARATION OF TRUST.
The exclusive purposes and functions of the Trust are (a) to issue and sell
Trust Securities, (b) to use the proceeds from such sale to acquire the
Debentures and (c) to engage in those activities necessary or incidental
thereto. The Depositor hereby appoints the Trustees as trustees of the Trust, to
have all the rights, powers and duties to the extent set forth herein, and the
Trustees hereby accept such appointment. The Property Trustee hereby declares
that it will hold the Trust Property in trust upon and subject to the conditions
set forth herein for the benefit of the Trust and the Holders. The
Administrative Trustees shall have all rights, powers and duties set forth
herein and in accordance with applicable law with respect to accomplishing the
purposes of the Trust. The Delaware Trustee shall not be entitled to exercise
any powers, nor shall the Delaware Trustee have any of the duties and
responsibilities, of the Property Trustee or the Administrative Trustees set
forth herein. The Delaware Trustee shall be one of the Trustees of the Trust for
the sole and limited purpose of fulfilling the requirements of Section 3807 of
the Delaware Business Trust Act.
SECTION 2.8. AUTHORIZATION TO ENTER INTO CERTAIN TRANSACTIONS.
(a) The Trustees shall conduct the affairs of the Trust in accordance with
the terms of this Trust Agreement. Subject to the limitations set forth in
Section 2.8(b) and Article VIII and in accordance with the following provisions
(i), (ii) and (iii), the Trustees shall have the authority to enter into all
transactions and agreements determined by the Trustees to be appropriate in
exercising the authority, express or implied, otherwise granted to the Trustees
under this Trust Agreement, and to perform all acts in furtherance thereof,
including the following:
(i) As among the Trustees, each Administrative Trustee, acting singly
or collectively, shall have the power and authority (except during any
period in which the Holders of the Preferred Securities shall have
appointed a Special Administrative Trustee pursuant to Section 6.1(d) and
except to the extent expressly provided by the terms hereof) to act on
behalf of the Trust with respect to the following matters:
(A) the issuance and sale of the Trust Securities; provided,
however, that the Trust may issue no more than one series of Preferred
Securities and no more than one series of Common Securities, and,
provided further, that there shall be no interests in the Trust other
than the Trust Securities, and the issuance of Trust Securities shall
be limited to simultaneous issuances of both Preferred Securities and
Common Securities on the Closing Date;
-13-
(B) causing the Trust to enter into, and executing, delivering
and performing on behalf of the Trust, the Purchase Agreement, the
Subscription Agreement, the Debenture Purchase Agreement and such
other agreements as may be necessary or desirable in connection with
the purposes and function of the Trust and the issuance of the Trust
Securities;
(C) assisting in the listing, if any, of the Preferred Securities
upon the PORTAL Market;
(D) sending notices (other than notices of default) and other
information regarding the Trust Securities and the Debentures to the
Holders in accordance with this Trust Agreement;
(E) appointing a Paying Agent, Conversion Agent and Securities
Registrar in accordance with this Trust Agreement;
(F) registering transfer of the Trust Securities in accordance
with this Trust Agreement;
(G) to the extent provided in this Trust Agreement, the winding
up of the affairs of and liquidation of the Trust and executing and
filing the certificate of cancellation with the Secretary of State of
the State of Delaware;
(H) unless otherwise required by the Delaware Business Trust Act
or the Trust Indenture Act, executing on behalf of the Trust (either
acting alone or together with any or all of the Administrative
Trustees) any documents that the Administrative Trustees have the
power to execute pursuant to this Trust Agreement; and
(I) taking any action incidental to the foregoing as the
Administrative Trustees may from time to time determine is necessary
or advisable to give effect to the terms of this Trust Agreement for
the benefit of the Holders (without consideration of the effect of any
such action on any particular Holder).
(ii) As among the Trustees, the Property Trustee shall have the power,
duty and authority to act on behalf of the Trust with respect to the
following matters:
(A) establishing the Payment Account;
(B) receiving and holding the Debentures;
-14-
(C) collecting principal of, premium, if any, and interest on,
and any other payments made in respect of, the Debentures in the
Payment Account;
(D) distributing, through the Paying Agent, amounts owed to the
Holders in respect of the Trust Securities;
(E) exercising all of the rights, powers and privileges of a
holder of the Debentures;
(F) sending notices of default and other information regarding
the Trust Securities and the Debentures to the Holders in accordance
with this Trust Agreement;
(G) distributing the Trust Property in accordance with the terms
of this Trust Agreement;
(H) to the extent provided in this Trust Agreement, winding up
the affairs of and liquidating the Trust and the executing and filing
the certificate of cancellation with the Secretary of State of the
State of Delaware; and
(I) except as otherwise provided in this Section 2.8(a)(ii), the
Property Trustee shall have none of the duties, liabilities, powers or
the authority of the Administrative Trustees set forth in Section
2.8(a)(i).
(iii) At such times as a Special Administrative Trustee shall have
been appointed by the Holders of the Preferred Securities pursuant to
Section 6.1(d), the Special Administrative Trustee shall have the power and
authority to act on behalf of the Trust jointly with the Administrative
Trustees, and the Administrative Trustees and the Special Administrative
Trustee shall act collectively as determined by a majority.
(b) So long as this Trust Agreement remains in effect, the Trust (or the
Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees shall not: (i) acquire any investments or
engage in any activities not authorized by this Trust Agreement; (ii) sell,
assign, transfer, exchange, mortgage, pledge, set-off or otherwise dispose of
any of the Trust Property or interests therein, including to Holders, except as
expressly provided herein; (iii) take any action that would cause the Trust to
fail or cease to qualify as a "grantor trust" for United States federal income
tax purposes; (iv) incur any indebtedness for borrowed money or issue any other
debt; (v) take or consent to any action that would result in the creation of a
Lien on any of the Trust Property; (vi) invest any proceeds received by the
Trust from holding the Debentures, but shall distribute all such proceeds to
Holders of Trust
-15-
Securities pursuant to the terms of this Trust Agreement and of the Trust
Securities; (vii) acquire any assets other than the Trust Property; (viii)
possess any power or otherwise act in such a way as to vary the Trust Property;
(ix) possess any power or otherwise act in such a way as to vary the terms of
the Trust Securities in any way whatsoever (except to the extent expressly
authorized in this Trust Agreement or by the terms of the Trust Securities); or
(x) issue any securities or other evidences of beneficial ownership of, or
beneficial interest in, the Trust other than the Trust Securities. The
Administrative Trustees shall defend all claims and demands of all Persons at
any time claiming any Lien on any of the Trust Property adverse to the interest
of the Trust or the Holders in their capacity as Holders.
(c) In connection with the issue and sale of the Preferred Securities, the
Depositor shall have the right and responsibility to assist the Trust with
respect to, or effect on behalf of the Trust, the following (and any actions
taken by the Depositor in furtherance of the following prior to the date of this
Trust Agreement are hereby ratified and confirmed in all respects):
(i) to determine the States in which to take appropriate action to
qualify or register for sale or resale all or part of the Preferred
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 Depositor deems necessary or advisable in order to comply
with the applicable laws of any such States;
(ii) to negotiate the terms of and execute the Purchase Agreement
providing for the sale of the Preferred Securities;
(iii) to the extent applicable, to provide all annual and quarterly
reports and the information, documents and other reports that the Depositor
is required to file, if any, with the Commission pursuant to Section 13(a)
or 15(d) of the Exchange Act (the "SEC Reports") with the Indenture Trustee
and the Property Trustee within 15 days after it files them with the
Commission;
(d) The Administrative Trustees are authorized and directed to conduct the
affairs of the Trust and to operate the Trust so that the Trust will not be
deemed to be an "investment company" required to be registered under the 1940
Act, or fail to be classified as a grantor trust for United States federal
income tax purposes and so that the Debentures will be treated as indebtedness
of the Depositor for United States federal income tax purposes. In this
connection, the Depositor and the Administrative Trustees are authorized to take
any action, not inconsistent with applicable law, the Certificate of Trust or
this Trust Agreement, that each of the Depositor and any Administrative Trustee
determines in its discretion to
-16-
be necessary or desirable for such purposes, as long as such action does not
adversely affect in any material respect the interests of the Holders of the
Preferred Securities.
SECTION 2.9. ASSETS OF TRUST.
The assets of the Trust shall consist solely of the Trust Property.
SECTION 2.10. TITLE TO TRUST PROPERTY.
Legal title to all Trust Property shall be vested at all times in the
Property Trustee (in its capacity as such) and shall be held and administered by
the Property Trustee for the benefit of the Trust and the Holders in accordance
with this Trust Agreement.
ARTICLE III
PAYMENT ACCOUNT
SECTION 3.1. PAYMENT ACCOUNT.
(a) On or prior to the Closing Date, the Property Trustee will establish
the Payment Account. The Property Trustee and any agent of the Property Trustee
will have exclusive control and sole right of withdrawal with respect to the
Payment Account for the purpose of making deposits in and withdrawals from the
Payment Account in accordance with this Trust Agreement. All funds and other
property deposited or held from time to time in the Payment Account will be held
by the Property Trustee in the Payment Account for the exclusive benefit of the
Holders and for distribution as provided herein, including (and subject to) any
priority of payments provided for herein.
(b) The Property Trustee will deposit in the Payment Account, promptly upon
receipt, all payments of principal of, premium, if any, or interest on, and any
other payments or proceeds with respect to the Debentures. Amounts held in the
Payment Account will not be invested by the Property Trustee.
-17-
ARTICLE IV
DISTRIBUTIONS; REDEMPTION; CONVERSION
SECTION 4.1. DISTRIBUTIONS.
(a) The Trust Securities represent undivided beneficial ownership interests
in the Trust Property, and distributions (the "Distributions") will be made on
the Trust Securities at the rate and on the dates that payments of interest
(including Additional Interest, as defined in the Indenture) are made on the
Debentures.
Accordingly:
(i) Distributions on the Trust Securities will be cumulative, and will
accumulate whether or not there are funds of the Trust available for the
payment of Distributions. Distributions will accrue from March 15, 2000,
and, except in the event (and to the extent) that the Depositor exercises
its right to defer the payment of interest on the Debentures pursuant to
the Indenture, will be payable quarterly in arrears on January 1, April 1,
July 1 and October 1 of each year, commencing on July 1, 2000. If any date
on which a Distribution is otherwise payable on the Trust Securities is not
a Business Day, then the payment of such Distribution will be made on the
next succeeding day that is a Business Day (without any additional
Distributions or other payment in respect of such delay) except that, if
such Business Day is in the next succeeding calendar year, payment of such
Distribution shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such date (each date
on which Distributions are payable in accordance with this Section 4.1(a),
a "Distribution Date").
(ii) Assuming payments of interest on the Debentures are made when due
(and before giving effect to Additional Amounts, if applicable),
Distributions on the Trust Securities shall be payable at an annual rate of
10% of the Liquidation Amount of the Trust Securities, the annual interest
rate for the Debentures. The amount of Distributions payable for any period
will be computed on the basis of a 360-day year of twelve 30-day months.
(iii) Distributions on the Trust Securities will be made by the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Trust has funds then on hand
and available in the Payment Account for the payment of such Distributions.
-18-
(b) Distributions on the Trust Securities with respect to a Distribution
Date shall be payable to the Holders thereof as they appear on the Securities
Register for the Trust Securities on the relevant record date, which shall be
the 15th day of the month preceding the month in which the relevant Distribution
Date occurs without giving effect to the third sentence of Section 4.1(a)(i)
(whether or not such record date is a Business Day).
SECTION 4.2. REDEMPTION.
(a) On each Debenture Redemption Date and on the Debenture Stated Maturity,
the Trust shall be required to redeem a Like Amount of Trust Securities at the
Redemption Price. In addition, in the case of the occurrence of a Tax Event, if
(i) the Depositor has received an opinion (a "Redemption Tax Opinion") from
independent tax counsel experienced in such matters that, as a result of a Tax
Event, there is more than an insubstantial risk that the Depositor would be
precluded from deducting the interest on the Debentures for United States
federal income tax purposes even after the Convertible Subordinated Debentures
were distributed to the holders of Preferred Securities in liquidation of such
holders' interests in the Trust Pursuant to Section 9.4 or (ii) the
Administrative Trustees shall have been informed by such tax counsel that an
opinion from independent tax counsel experienced in such matters to the effect
that the holders of the Preferred Securities will not recognize any gain or loss
for United States federal income tax purposes as a result of such dissolution
and distribution of Convertible Subordinated Debentures (a "No Recognition
Opinion") cannot be delivered, the Depositor shall have the right, upon not less
than 30 nor more than 60 days notice, to redeem the Convertible Subordinated
Debentures in whole or in part for cash within 90 days following the occurrence
of such Tax Event, and, following such redemption, Preferred Securities with an
aggregate liquidation amount equal to the aggregate principal amount of the
Convertible Subordinated Debentures so redeemed shall be redeemed by the Trust
at the Redemption Price on a pro rata basis or in such other manner as the
Property Trustee deems appropriate; provided, however, that, if at the time
there is available to the Depositor or the Trust the opportunity to eliminate,
within such 90 day period, the Tax Event by taking some ministerial action, such
as filing a form or making an election, or pursuing some other similar
reasonable measure which has no adverse effect on the Trust, the holders of the
Preferred Securities or the Depositor, the Trust will pursue such measure in
lieu of redemption.
(b) Notice of redemption shall be given by the Property Trustee by
first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date to each Holder of Trust Securities to be redeemed,
at such Holder's address appearing in the Security Register. All notices of
redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
-19-
(iii) if less than all the Outstanding Trust Securities are to be
redeemed, the identification and the total Liquidation Amount of the
particular Trust Securities to be redeemed;
(iv) that on the Redemption Date the Redemption Price shall become due
and payable upon each such Trust Security to be redeemed and that
Distributions thereon shall cease to accrue on and after said date; and
(v) the place and address where the Holders shall surrender their
Certificated Preferred Securities.
(c) The Trust Securities redeemed on each Redemption Date will be redeemed
at the Redemption Price with the proceeds from the contemporaneous redemption on
the Debenture Redemption Date or payment at the Debenture Stated Maturity.
Redemptions of the Trust Securities will be made and the Redemption Price will
be payable on each Redemption Date only to the extent that the Trust has funds
then on hand and available in the Payment Account for the payment of such
Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect of any
Preferred Securities, then, by 12:00 noon, New York City time, on the Redemption
Date, subject to Section 4.2(c), the Property Trustee will irrevocably deposit
with the Paying Agent funds sufficient to pay the applicable Redemption Price
and will give the Paying Agent irrevocable instructions and authority to pay the
Redemption Price to the Holders thereof upon surrender of their Preferred
Securities Certificates. Notwithstanding the foregoing, Distributions payable on
or prior to the Redemption Date for any Trust Securities called for redemption
will be payable to the Holders of such Trust Securities as they appear on the
Securities Register for the Trust Securities on the relevant record dates for
the related Distribution Dates. If notice of redemption shall have been given
and funds deposited as required, then upon the date of such deposit all rights
of Holders holding Trust Securities so called for redemption shall cease, except
(i) the right of such Holders to receive the Redemption Price and any
Distribution payable on or prior to the Redemption Date, but without interest
thereon and (ii) any right of the Holders to cause the Conversion Agent to
convert the Trust Securities, and such Trust Securities will cease to be
Outstanding. In the event that any date on which any Redemption Price is payable
is not a Business Day, then payment of the Redemption Price payable on such date
shall be made on the next succeeding day that is a Business Day (and without any
interest or other payment in respect of any such delay), except that, if such
Business Day falls in the next calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date. In the event that payment of the Redemption Price in
respect of any Trust Securities called for redemption is improperly withheld or
refused and not paid either by the Trust or by the Depositor pursuant to the
Guarantee, Distributions on such Trust Securities shall continue to accrue, at
the then applicable
-20-
rate, from the Redemption Date originally established by the Trust for such
Trust Securities to the date such Redemption Price is actually paid, in which
case the actual payment date shall be the date fixed for redemption for purposes
of calculating the Redemption Price.
(e) Payment of the Redemption Price on the Trust Securities shall be made
to the recordholders thereof as they appear on the Securities Register for the
Trust Securities on the relevant record date, which shall be 15 days prior to
the relevant Redemption Date.
(f) Subject to Section 4.4(a), if less than all of the Outstanding Trust
Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Trust Securities to be redeemed shall be allocated among
the Common Securities and the Preferred Securities. The particular Preferred
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Property Trustee from the Outstanding Preferred
Securities not previously called for redemption on a pro rata basis or by such
other method as the Property Trustee shall deem fair and appropriate and which
may provide for the selection for redemption of portions (equal to $50 or an
integral multiple of $50 in excess thereof) of the Liquidation Amount of
Preferred Securities of a denomination larger than $50. The Property Trustee
shall promptly notify the Security Registrar in writing of the Preferred
Securities selected for redemption and, in the case of any Preferred Securities
selected for partial redemption, the Liquidation Amount thereof to be redeemed.
For all purposes of this Trust Agreement, unless the context otherwise requires,
all provisions relating to the redemption of Preferred Securities shall relate,
in the case of any Preferred Securities redeemed or to be redeemed only in part,
to the portion of the Liquidation Amount of Preferred Securities that has been
or is to be redeemed.
SECTION 4.3. CONVERSION.
The Holders shall have the right at any time prior to 5:00 p.m. (New York
City time) on the second Business Day immediately preceding the date of
repayment of such Trust Securities, whether at maturity or upon redemption
(either at the option of the Depositor or pursuant to a Tax Event), at their
option, to cause the Conversion Agent to convert Trust Securities, on behalf of
the converting Holders, into shares of the Common Stock in the manner described
herein on and subject to the following terms and conditions:
(a) The Trust Securities shall be convertible at the office of the
Conversion Agent into fully paid and nonassessable shares of Common Stock
pursuant to the Holder's direction to the Conversion Agent to exchange such
Trust Securities for a portion of the Debentures theretofore held by the
Trust on the basis of one Trust Security per $50 principal amount of
Debentures, and immediately convert such amount of Debentures (or any
portion thereof that is an integral multiple of $50) into fully paid and
nonassessable shares of Common Stock at an initial conversion premium of
17.5%
-21-
above the average closing price of the Common Stock during the ten (10)
Trading Days after the Depositor's first earnings announcement after the
Split-off, subject to certain adjustments set forth in the terms of the
Debentures and the Indenture (as so adjusted, "Conversion Price").
Notwithstanding the foregoing, no holder of Preferred Securities that is
subject to the restrictions of Section 4 of the Bank Holding Company Act of
1956, as amended (the "BHCA") (a "BHCA Person"), shall have the right to convert
any Preferred Securities if, after giving effect to such conversion, the BHCA
Person, its affiliates and transferees would own or be deemed to own shares of
Common Stock in excess of either the maximum number of shares of Common Stock
which the BHCA Person is permitted to own under the BHCA and the regulations of
the Board of Governors of the Federal Reserve thereunder or such lower number as
the relevant BHCA Person may have requested in writing to the Conversion Agent.
No BHCA Person shall have the right to assign or transfer its Preferred
Securities (other than to an Affiliate) unless such Preferred Securities are
assigned or transferred (i) to the public in an offering registered under the
Securities Act, (ii) in a transaction pursuant to Rule 144 or 144A under the
Securities Act in which no person acquires Preferred Securities convertible into
more than 2% of the outstanding Common Stock, (iii) in a single transaction to a
third party who acquires a majority of the Common Stock without regard to the
conversion of any Preferred Securities so transferred or (iv) in any other
manner permitted under the BHCA. The Conversion Agent may rely on the
representation of the relevant BHCA Person that a transfer has been made in the
foregoing manner.
(b) In order to convert Trust Securities into Common Stock, the Holder
shall submit to the Conversion Agent an irrevocable request to convert
Trust Securities on behalf of such Holder (the "Conversion Request"),
together with such Trust Security Certificates. The Conversion Request
shall: (i) set forth the number of Trust Securities to be converted and the
name or names, if other than the Holder, in which the shares of Common
Stock should be issued; and (ii) direct the Conversion Agent (A) to
exchange such Trust Securities for a portion of the Debentures held by the
Trust (at the rate of exchange specified in Section 4.3(a)) and (B) to
immediately convert such Debentures on behalf of such Holder into Common
Stock (at the Conversion Price specified in Section 4.3(a)). The Conversion
Agent shall notify the Trust of the Holder's election to exchange Trust
Securities for a portion of the Debentures held by the Trust and the
Property Trustee on behalf of the Trust shall, upon receipt of such notice,
deliver to the Conversion Agent the appropriate principal amount of
Debentures for exchange in accordance with this Section 4.3. The Conversion
Agent shall thereupon notify the Depositor of the Holder's election to
convert such Debentures into shares of Common Stock.
-22-
(c) Accrued Distributions shall not be paid on Preferred Securities
that are converted, nor will any payment, allowance or adjustment be made
for accumulated and unpaid Distributions, whether or not in arrears, on
converted Preferred Securities except that if any Preferred Security is
converted (i) on or after a record date for payment of Distributions
thereon, the amount of the Distributions payable on the related payment
date with respect to such Preferred Security shall be paid to the
converting Holder by the Trust and the Distributions payable on the related
payment date with respect to such Preferred Security shall be distributed
on such payment date to the Holder as of such record date, despite such
conversion, and (ii) during an Extension Period and after the Property
Trustee mails a notice of redemption with respect to the Preferred
Securities that are converted, accrued and unpaid Distributions through the
date of conversion on such Preferred Securities called for redemption shall
be distributed to the Holder who converts such Preferred Securities, which
Distribution shall be made on the redemption date fixed for redemption.
Except as provided above, neither the Trust nor the Depositor shall make,
or be required to make, any payment, allowance or adjustment upon any
conversion on account of any accumulated and unpaid Distributions accrued
on the Trust Securities (including Additional Amounts, if applicable)
surrendered for conversion, or on account of any accumulated and unpaid
dividends, if any, on the shares of Common Stock issued upon such
conversion. The Depositor shall make no payment or allowance for
distributions on the shares of Common Stock issued upon such conversion,
except to the extent that such shares of Common Stock are held of record on
the record date for any such distributions and except as provided in
Section 13.9 of the Indenture. Trust Securities shall be deemed to have
been converted immediately prior to 5:00 p.m. (New York City time) on the
day on which a Conversion Request relating to such Trust Securities is
received by the Trust in accordance with the foregoing provisions of this
Section 4.3 (the "Conversion Date"). The Person or Persons entitled to
receive the Common Stock issuable upon conversion of the Debentures shall
be treated for all purposes as the record holder or holders of such Common
Stock at such time. As promptly as practicable on or after the Conversion
Date, the Depositor shall issue and deliver at the office of the Conversion
Agent a certificate or certificates for the number of full shares of Common
Stock issuable upon such conversion, together with the cash payment, if
any, in lieu of any fraction of any share to the Person or Persons entitled
to receive the same as provided in Section 4.3(e), unless otherwise
directed by the Holder in the Conversion Request, and the Conversion Agent
shall distribute such certificate or certificates to such Person or
Persons.
(d) Each Holder of a Trust Security by his acceptance thereof appoints
the Bank (the "Conversion Agent") for the purpose of effecting the
conversion of Trust Securities in accordance with this Section 4.3. In
effecting the conversion and trans-
-23-
actions described in this Section 4.3, the Conversion Agent shall be acting
as agent of the Holders directing it to effect such conversion
transactions. The Conversion Agent is hereby authorized (i) to exchange
Trust Securities from time to time for Debentures held by the Trust in
connection with the conversion of such Trust Securities in accordance with
this Section 4.3 and (ii) to convert all or a portion of the Debentures
into Common Stock and thereupon to deliver such shares of Common Stock in
accordance with the provisions of this Section 4.3 and to deliver to the
Trust a new Debenture or Debentures for any resulting unconverted principal
amount.
(e) No fractional shares of Common Stock shall be issued as a result
of conversion, but in lieu thereof, such fractional interest shall be paid
in cash (based on the last reported sale price of the Common Stock on the
Conversion Date) by the Depositor to the Trust, which in turn shall make
such payment to the Holder or Holders of Trust Securities so converted.
(f) The Depositor shall at all times reserve and keep available out of
its authorized and unissued Common Stock, solely for issuance upon the
conversion of the Debentures, free from any preemptive or other similar
rights, such number of shares of Common Stock as shall from time to time be
issuable upon the conversion of all of the Debentures then outstanding.
Notwithstanding the foregoing, the Depositor shall be entitled to deliver,
upon conversion of Debentures, shares of Common Stock reacquired and held
in the treasury of the Depositor (in lieu of the issuance of authorized and
unissued shares of Common Stock), so long as any such treasury shares are
free and clear of all liens, charges, security interests or encumbrances.
Any shares of Common Stock issued upon conversion of the Debentures shall
be duly authorized, validly issued, fully paid and nonassessable. The Trust
shall deliver the shares of Common Stock received upon conversion of the
Debentures to the converting Holder free and clear of all liens, charges,
security interests and encumbrances, except for United States withholding
taxes. Each of the Depositor and the Trust shall prepare and shall use its
best efforts to obtain and keep in force such governmental or regulatory
permits or other authorizations as may be required by law, and shall comply
with all applicable requirements as to registration or qualification of the
Common Stock (and all requirements to list the Common Stock issuable upon
conversion of Debentures that are at the time applicable), in order to
enable the Depositor to lawfully issue Common Stock to the Trust upon
conversion of the Debentures and the Trust to lawfully deliver the Common
Stock to each Holder upon conversion of the Trust Securities.
(g) The Depositor will pay any and all taxes that may be payable in
respect of the issue or delivery of shares of Common Stock on conversion of
Debentures and the
-24-
delivery of the shares of Common Stock by the Trust upon conversion of the
Trust Securities. The Depositor shall not, however, be required to pay any
tax that may be payable in respect of any transfer involved in the issue
and delivery of shares of Common Stock in a name other than that in which
the Trust Securities so converted were registered, and no such issue or
delivery shall be made unless and until the person requesting such issue
has paid to the Trust the amount of any such tax or has established to the
satisfaction of the Trust that such tax has been paid.
(h) Nothing in this Section 4.3 shall limit the requirement of the
Trust to withhold taxes pursuant to the terms of the Trust Securities or as
set forth in this Trust Agreement or otherwise require the Property Trustee
or the Trust to pay any amount on account of such withholdings.
SECTION 4.4. SUBORDINATION OF COMMON SECURITIES.
(a) Payment of Distributions (including Additional Amounts) on, and the
Redemption Price of, the Trust Securities, as applicable, shall be made, subject
to Section 4.2(f), pro rata among the Common Securities and the Preferred
Securities based on the Liquidation Amount of the Trust Securities; provided,
however, that if on any Distribution Date or Redemption Date any Event of
Default resulting from an Indenture Event of Default shall have occurred and be
continuing, no payment of any Distribution (including Additional Amounts, if
applicable) on, or Redemption Price of, any Common Security, and no other
payment on account of the redemption, liquidation or other acquisition of Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions (including Additional Amounts, if applicable) on all
Outstanding Preferred Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all Outstanding Preferred Securities then called for
redemption, shall have been made or provided for, and all funds available to the
Property Trustee shall first be applied to the payment in full in cash of all
Distributions (including Additional Amounts, if applicable) on, or the
Redemption Price of, Preferred Securities then due and payable.
(b) In the case of the occurrence of any Event of Default resulting from
any Indenture Event of Default, the Holder of Common Securities shall be deemed
to have waived any right to act with respect to any such Event of Default under
this Trust Agreement until the effect of all such Events of Default with respect
to the Preferred Securities shall have been cured, waived or otherwise
eliminated. Until any such Event of Default under this Trust Agreement with
respect to the Preferred Securities has been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the Holders of
the Preferred Securities and not the Holder of the Common Securities, and only
the Holders of the Preferred Securities shall have the right to direct the
Property Trustee to act on their behalf.
-25-
SECTION 4.5. PAYMENT PROCEDURES.
Payments of Distributions (including Additional Amounts, if applicable) in
respect of the Preferred Securities shall be made by check mailed to the address
of the Person entitled thereto as such address shall appear on the Securities
Register. 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 Holder of the Common Securities.
SECTION 4.6. TAX RETURNS AND REPORTS.
The Administrative Trustees shall prepare (or cause to be prepared), at the
Depositor's expense, and file all United States federal, state and local tax and
information returns and reports required to be filed by or in respect of the
Trust. In this regard, the Administrative Trustees shall (a) prepare and file
(or cause to be prepared and filed) the appropriate Internal Revenue Service
Form required to be filed in respect of the Trust in each taxable year of the
Trust and (b) prepare and furnish (or cause to be prepared and furnished) to
each Holder the appropriate Internal Revenue Service form and the information
required to be provided on such form. The Administrative Trustees shall provide
the Depositor and the Property Trustee with a copy of all such returns and
reports promptly after such filing or furnishing. The Trustees shall comply with
United States federal withholding and backup withholding tax laws and
information reporting requirements with respect to any payments to Holders under
the Trust Securities.
SECTION 4.7. PAYMENT OF EXPENSES OF TRUST.
Pursuant to Section 10.6 of the Indenture, the Depositor, as borrower, has
agreed to pay to the Trust, and reimburse the Trust for, the full amount of any
costs, expenses or liabilities of the Trust (other than obligations of the Trust
to pay the Holders of any Preferred Securities or other similar interests in the
Trust the amounts due such Holders pursuant to the terms of the Preferred
Securities or such other similar interests, as the case may be), including any
taxes, duties or other governmental charges of whatever nature (other than
withholding taxes) imposed on the Trust by the United States or any other taxing
authority. Such payment obligation includes any such costs, expenses or
liabilities of the Trust that are required by applicable law to be satisfied in
connection with a termination of the Trust.
SECTION 4.8. PAYMENTS UNDER INDENTURE OR PURSUANT TO DIRECT ACTIONS.
Any amount payable hereunder to any Holder of Preferred Securities shall be
reduced by the amount of any corresponding payment such Holder (or an Owner with
respect
-26-
to the Holder's Preferred Securities) has directly received pursuant to Section
5.8 of the Indenture or Section 5.13 of this Trust Agreement.
ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 5.1. INITIAL OWNERSHIP.
Upon the creation of the Trust and the contribution by the Depositor
pursuant to Section 2.3 and until the issuance of the Trust Securities, and at
any time during which no Trust Securities are Outstanding, the Depositor shall
be the sole beneficial owner of the Trust.
SECTION 5.2. TRUST SECURITIES CERTIFICATES.
The Trust Securities Certificates shall be issued in minimum denominations
of $50 Liquidation Amount and integral multiples of $50 in excess thereof. The
Trust Securities Certificates shall be executed on behalf of the Trust by manual
or facsimile signature of at least one Administrative Trustee and, if executed
on behalf of the Trust by facsimile, countersigned by a transfer agent or its
agent. The Certificated Preferred Securities shall be authenticated by the
Property Trustee by manual or facsimile signature of an authorized signatory
thereof and, if executed by such authorized signatory of the Property Trustee by
facsimile, countersigned by a transfer agent or its agent. Trust Securities
Certificates bearing the manual 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 or, if executed on behalf of the Trust or the
Property Trustee by facsimile, countersigned by a transfer agent or its agent,
shall be validly issued and entitled to the benefits of this Trust Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so
authorized prior to the delivery of such Trust Securities Certificates or did
not hold such offices at the date of delivery of such Trust Securities
Certificates. A transferee of a Trust Securities 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 Securities Certificate in
such transferee's name pursuant to Sections 5.4, 5.12 and 5.15.
SECTION 5.3. EXECUTION AND DELIVERY OF TRUST SECURITIES CERTIFICATES.
On the Closing Date, (i) the Administrative Trustees shall cause Trust
Securities Certificates, in an aggregate Liquidation Amount as provided in, or
determined in accor-
-27-
dance with, Sections 2.4 and 2.5, to be executed on behalf of the Trust and
delivered to or upon the written order of the Depositor, signed by its chairman
of the board, its president, any executive vice president or any vice president
and its treasurer or assistant treasurer or controller without further corporate
action by the Depositor, in authorized denominations and (ii) the Property
Trustee shall authenticate the Certificated Preferred Securities in accordance
with an order of the Depositor.
SECTION 5.4. REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED SECURITIES.
(a) Trust Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Trust Agreement and
in the terms of the Preferred Securities. Any transfer or purported transfer of
any Trust Security not made in accordance with this Trust Agreement shall, to
the fullest extent permitted by applicable law, be null and void.
(b) Upon issuance of the Common Securities, the Depositor shall acquire and
retain beneficial and record ownership of the Common Securities and, for so long
as the Preferred Securities remain outstanding, the Depositor shall maintain
100% ownership of the Common Securities, provided that any permitted successor
of the Depositor under the Indenture may succeed to the Depositor's ownership of
the Common Securities; and provided further, that the Depositor and any
wholly-owned subsidiary may transfer Common Securities to the Depositor or
wholly-owned subsidiary of the Depositor or any entity owning all of the
outstanding Common Stock of the Depositor, with any such transfer being subject
to the condition precedent that the transferor obtain Opinion of Counsel that
such transfer would not cause more than an insubstantial risk that:
(i) the Trust would not be classified for United States federal income
tax purposes as a grantor trust; or
(ii) the Trust would be an investment company required to register
under the Investment Company Act or the transferee would become an
investment company required to register under the Investment Company Act.
(c) Subject to this Article 5, Preferred Securities shall be freely
transferable; provided that, any Holder which is a BHCA Person shall be subject
to the restrictions set forth in Section 4.3(a) hereof.
(d) The Trust shall not be required (i) to issue, register the transfer of
or exchange any Preferred Securities during a period beginning at the opening of
business 15 days before the day of any selection of Preferred Securities for
redemption and ending at the close
-28-
of business on the earliest date on which the relevant notice of redemption is
deemed to have been given to all Holders of Preferred Securities to be redeemed,
or (ii) to register the transfer or exchange of any Preferred Security so
selected for redemption in whole or in part, except the unredeemed portion of
any Preferred Security being redeemed in part. Furthermore, the Trust shall
refuse to register any transfer of any Preferred Security (and the Depositor
shall refuse to register any transfer of Common Stock issued upon the conversion
or exchange of a Preferred Security) if such transfer is not made pursuant to
registration under the Securities Act or pursuant to Rule 144A or Regulation S
under the Securities Act or pursuant to another available exemption from
registration.
(e) Each Trust Security that bears or is required to bear the legend set
forth in this Section 5.4(e) (a "Transfer Restricted Security") shall be subject
to the restrictions on transfer provided in the legend set forth in this Section
5.4(e), unless such restrictions on transfer shall be waived by the written
consent of the Administrative Trustees, and the Holder of each Transfer
Restricted Security, by such Holder's acceptance thereof, agrees to be bound by
such restrictions on transfer. As used in this Section 5.4, the term "transfer"
encompasses any sale, pledge, transfer or other disposition of any Transfer
Restricted Security.
Prior to the Resale Restriction Termination Date, any certificate
representing Preferred Securities shall bear the following legend (unless such
Preferred Securities have been sold pursuant to a registration statement that
has been declared effective under the Securities Act):
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER THE SECURITIES LAWS OF
ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, RESOLD, 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,
SUCH REGISTRATION.
THE HOLDER HEREOF MAY NOT ENGAGE IN HEDGING TRANSACTIONS IN THIS
SECURITY UNLESS SUCH TRANSACTIONS ARE IN COMPLIANCE WITH THE SECURITIES
ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
RESELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS THE LATER OF (X) TWO YEARS AFTER
THE LATER OF THE ORIGINAL ISSUE DATE
-29-
HEREOF AND THE LAST DATE ON WHICH GENTIVA HEALTH SERVICES, INC. (THE
"COMPANY") OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY
(OR ANY PREDECESSOR OF SUCH SECURITY), AND (Y) SUCH LATER DATE, IF ANY, AS
MAY BE REQUIRED BY APPLICABLE LAW ONLY (A) TO THE COMPANY, (B) PURSUANT TO
A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE
IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR
OUTSIDE THE UNITED STATES IN ACCORDANCE WITH REGULATION S UNDER THE
SECURITIES ACT, OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S
AND THE TRANSFER AGENT'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF
THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE
RESALE RESTRICTION TERMINATION DATE. ANY TRANSFER OF THIS SECURITY IS
REQUIRED TO BE MADE IN COMPLIANCE WITH THE APPLICABLE STATE SECURITIES LAWS
AND APPLICABLE SECURITIES LAWS OF OTHER JURISDICTIONS.
EACH PURCHASER OR HOLDER OF THE SECURITY EVIDENCED HEREBY WILL BE
DEEMED TO HAVE REPRESENTED EITHER THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN
SUBJECT TO PART 4 OF SUBTITLE B OF TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, ("ERISA") OR A PLAN DESCRIBED IN
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"),
OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE THE ASSETS OF ANY SUCH ERISA
PLAN OR OTHER PLAN.
-30-
THE HOLDER OF THIS SECURITY AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS CAPITAL SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.
In the case of a purchaser of Preferred Securities in the State of Georgia,
for a period of one year from the Closing Date, the Preferred Securities shall
contain the following additional legend:
THESE SECURITIES HAVE BEEN ISSUED OR SOLD IN RELIANCE ON PARAGRAPH
(13) OF CODE SECTION 10-5-9 OF THE `GEORGIA SECURITIES ACT OF 1973', AND
MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN A TRANSACTION WHICH IS EXEMPT
UNDER SUCH ACT OR PURSUANT TO AN EFFECTIVE REGISTRATION UNDER SUCH ACT.
Following the Resale Restriction Termination Date, any Trust Security or
security issued in exchange or substitution therefor (other than (i) Trust
Securities acquired by the Depositor or any Affiliate of the Depositor and (ii)
Common Stock issued upon the conversion or exchange of any Trust Security
described in clause (i) above) may, upon surrender of such Trust Security for
exchange to any Administrator on behalf of the Trust in accordance with the
provisions of this Section 5.4, be exchanged for a new Trust Security or Trust
Securities, of like tenor and aggregate liquidation amount, which shall not bear
the restrictive legend required by this Section 5.4(e).
(f) Any Preferred Security or Common Stock issued upon the conversion or
exchange of a Preferred Security that, prior to the Resale Restriction
Termination Date, is purchased or owned by the Depositor or any Affiliate
thereof may not be resold by the Depositor or such Affiliate unless registered
under the Securities Act or resold pursuant to an exemption from the
registration requirements of the Securities Act in a transaction that results in
such Preferred Securities or Common Stock, as the case may be, no longer being
"restricted securities" (as defined under Rule 144).
SECTION 5.5. TRANSFER OF CERTIFICATES.
The Trust shall maintain an office or agency in The City of New York or
Wilmington, Delaware where Securities may be presented for transfer, exchange or
conversion. The Trust shall keep or cause to be kept at such office or agency a
register for the purpose of registering Preferred Securities and transfers and
exchanges of Preferred Securities (the "Securities Register"), such register to
be held by a registrar (the "Securities Registrar"). The Securities Registrar
shall provide for the registration of Trust Securities Certificates and of
-31-
transfers of Trust Securities Certificates, which will be effected without
charge, but only upon payment (with such indemnity as the Securities Registrar
may require) in respect of any tax or other government charges that may be
imposed in relation to it. Upon surrender for registration of transfer of any
Trust Securities Certificate, the Trust shall cause one or more new Trust
Securities Certificates to be issued in the name of the designated transferee or
transferees. Every Trust Securities Certificate surrendered for registration of
transfer shall be accompanied by a written instrument of transfer in the form
attached hereto as Exhibit D and which is satisfactory to the Securities
Registrar and duly executed by the Holder or such Holder's attorney duly
authorized in writing. Each Trust Securities Certificate surrendered for
registration of transfer shall be canceled by the Securities Registrar. A
transferee of a Trust Securities Certificate shall be entitled to the rights and
subject to the obligations of a Holder hereunder upon the receipt by such
transferee of a Trust Securities Certificate. By acceptance of a Trust
Securities Certificate, each transferee shall be deemed to have agreed to be
bound by this Trust Agreement.
SECTION 5.6. DEEMED HOLDERS.
The Trustees or the Securities Registrar may treat the Person in whose name
any Trust Securities Certificate shall be registered on the books and records of
the Trust as the sole Holder of such Trust Securities Certificate and of the
Trust Securities represented by such Trust Securities Certificate for purposes
of receiving Distributions and for all other purposes whatsoever and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Trust Securities Certificate or in the Trust Securities
represented by such Trust Securities Certificate on the part of any Person,
whether or not the Trustees or the Securities Registrar shall have actual or
other notice thereof.
SECTION 5.7. ACCESS TO LIST OF HOLDERS' NAMES AND ADDRESSES.
Each Holder and each Owner shall be deemed to have agreed not to hold the
Depositor, the Property Trustee or the Administrative Trustees accountable by
reason of the disclosure of its name and address, regardless of the source from
which such information was derived.
SECTION 5.8. MAINTENANCE OF OFFICE OR AGENCY.
The Administrative Trustees shall maintain an office or offices or agency
or agencies where Trust Securities Certificates may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Trustees in respect of the Trust Securities Certificates may be served. The
Administrative Trustees initially designate the corporate trust office of
Wilmington Trust Company, a Delaware banking Corporation, Attn: Cor-
-32-
porate Trust Department, as their principal corporate trust office for such
purposes. The Administrative Trustees shall give prompt written notice to the
Depositor, the Property Trustee and to the Holders of any change in the location
of the Securities Register or any such office or agency.
SECTION 5.9. APPOINTMENT OF PAYING AGENT.
The Paying Agent shall make Distributions to Holders from the Payment
Account and shall report the amounts of such Distributions to the Property
Trustee and the Administrative Trustees. Any Paying Agent shall have the
revocable power to withdraw funds from the Payment Account for the purpose of
making the Distributions referred to above. The Administrative Trustees may
revoke such power and remove the Paying Agent if such Trustees determine in
their sole discretion that the Paying Agent shall have failed to perform its
obligations under this Trust Agreement in any material respect. The Paying Agent
shall initially be the Bank and any co-paying agent chosen by the Bank and
acceptable to the Administrative Trustees and the Depositor. Any Person acting
as Paying Agent shall be permitted to resign as Paying Agent upon giving 30 days
written notice to the Administrative Trustees, the Property Trustee and the
Depositor. In the event that the Bank shall no longer be the Paying Agent or a
successor Paying Agent shall resign or its authority to act be revoked, the
Administrative Trustees shall appoint a successor that is acceptable to the
Property Trustee and the Depositor to act as Paying Agent (which shall be a bank
or trust company). The Administrative Trustees shall cause such successor Paying
Agent or any additional Paying Agent appointed by the Administrative Trustees to
execute and deliver to the Trustees an instrument in which such successor Paying
Agent or additional Paying Agent shall agree with the Trustees that, as Paying
Agent, such successor Paying Agent or additional Paying Agent will hold all
sums, if any, held by it for payment to the Holders in trust for the benefit of
the Holders entitled thereto until such sums shall be paid to such Holders. The
Paying Agent shall return all unclaimed funds to the Property Trustee and upon
resignation or removal of a Paying Agent such Paying Agent shall also return all
funds in its possession to the Property Trustee. The provisions of Sections 8.1,
8.3 and 8.6 shall apply to the Bank also in its role as Paying Agent, for so
long as the Bank shall act as Paying Agent and, to the extent applicable, to any
other paying agent appointed hereunder. Any Paying Agent shall be bound by the
requirements of the Trust Indenture Act with respect to paying agents of
securities. Any reference in this Trust Agreement to the Paying Agent shall
include any co-paying agent unless the context requires otherwise. The Paying
Agent shall be entitled to the rights and protections extended to the Property
Trustee when acting in such capacity.
SECTION 5.10. APPOINTMENT OF CONVERSION AGENT.
The Conversion Agent shall convert the Trust Securities of the Holders in
accordance with Section 4.3. The Administrative Trustees may revoke such power
and remove
-33-
the Conversion Agent if such Trustees determine in their sole discretion that
the Conversion Agent shall have failed to perform its obligations under this
Trust Agreement in any material respect. The Conversion Agent shall initially be
the Bank. Any Person acting as Conversion Agent shall be permitted to resign as
Conversion Agent upon giving 30 days written notice to the Administrative
Trustees, the Property Trustee and the Depositor. In the event that the Bank
shall no longer be the Conversion Agent or a successor Conversion Agent shall
resign or its authority to act be revoked, the Administrative Trustees shall
appoint a successor (which shall be a bank or trust company) that is acceptable
to the Property Trustee and the Depositor to act as Conversion Agent. The
provisions of Sections 8.1, 8.3 and 8.6 shall apply to the Bank also in its role
as Conversion Agent for so long as the Bank shall act as Conversion Agent and,
to the extent applicable, to any other conversion agent appointed hereunder. Any
Conversion Agent shall be bound by the requirements with respect to conversion
agents of securities issued pursuant to the Trust Indenture Act. Any reference
in this Trust Agreement to the Conversion Agent shall include any co-paying
agent unless the context requires otherwise. The Conversion Agent shall be
entitled to the rights and protections extended to the Property Trustee when
acting in such capacity.
SECTION 5.11. OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR.
On the Closing Date, the Depositor shall acquire and retain beneficial and
record ownership of the Common Securities. To the fullest extent permitted by
law, other than a transfer in connection with a consolidation or merger of the
Depositor into another Person, or any conveyance, transfer or lease by the
Depositor of its properties and assets substantially as an entirety to any
Person, pursuant to Section 8.1 of the Indenture, any attempted transfer of the
Common Securities shall be void. The Administrative Trustees shall cause each
Common Securities Certificate issued to the Depositor to contain a legend
stating:
"THIS CERTIFICATE IS NOT TRANSFERABLE TO ANY PERSON, EXCEPT THAT THE HOLDER
AND ANY WHOLLY-OWNED SUBSIDIARY MAY TRANSFER THIS SECURITY TO GENTIVA
HEALTH SERVICES, INC. OR A WHOLLY-OWNED SUBSIDIARY OF GENTIVA HEALTH
SERVICES, INC. OR ANY ENTITY OWNING ALL OF THE OUTSTANDING COMMON STOCK OF
GENTIVA HEALTH SERVICES, INC., SUBJECT TO RECEIPT BY THE TRUST OF AN
OPINION OF COUNSEL THAT SUCH TRANSFER WOULD NOT CAUSE MORE THAN AN
INSUBSTANTIAL RISK THAT (I) THE TRUST WOULD NOT BE CLASSIFIED FOR UNITED
STATES FEDERAL INCOME TAX PURPOSES AS A GRANTOR TRUST; OR (II) THE TRUST
WOULD BE AN INVESTMENT COMPANY REQUIRED TO REGISTER UNDER THE INVESTMENT
-34-
COMPANY ACT OR THE TRANSFEREE WOULD BECOME AN INVESMENT COMPANY REQUIRED TO
REGISTER UNDER THE INVESTMENT COMPANY ACT."
SECTION 5.12. MUTILATED, DESTROYED, LOST OR STOLEN TRUST SECURITIES
CERTIFICATES.
If (a) any mutilated Trust Securities Certificate shall be surrendered to
the Securities Registrar, or if the Securities Registrar shall receive evidence
to its satisfaction of the destruction, loss or theft of any Trust Securities
Certificate, and (b) there shall be delivered to the Securities Registrar and
the Administrative Trustees such security or indemnity as may be required by
them to save each of them harmless, then in the absence of notice that such
Trust Securities Certificate shall have been acquired by a bona fide purchaser,
the Administrative Trustees, or any one of them, on behalf of the Trust shall
execute by manual or facsimile signature and, if executed on behalf of the Trust
by facsimile signature, such certificate shall be countersigned by a transfer
agent, and make available for delivery, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Trust Securities Certificate, a new Trust
Securities Certificate of like class, tenor and denomination. In connection with
the issuance of any new Trust Securities Certificate under this Section 5.12,
the Administrative Trustees or the Securities Registrar may require the payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith. Any duplicate Trust Securities Certificate
issued pursuant to this Section 5.12 shall constitute conclusive evidence of an
undivided beneficial interest in the Trust Property, as if originally issued,
whether or not the lost, stolen or destroyed Trust Securities Certificate shall
be found at any time.
SECTION 5.13. RIGHTS OF HOLDERS.
(a) The legal title to the Trust Property is vested exclusively in the
Property Trustee (in its capacity as such) in accordance with Section 2.10, and
the Holders shall not have any right or title therein other than the undivided
beneficial ownership interest in the assets of the Trust conferred by their
Trust Securities, and they shall have no right to call for any partition or
division of property, profits or rights of the Trust except as described below.
The Trust Securities shall be personal property giving only the rights
specifically set forth therein and in this Trust Agreement. The Trust Securities
shall have no preemptive or similar rights and when issued and delivered to
Holders against payment of the purchase price therefor shall be fully paid and
nonassessable by the Trust. The Holders of the Preferred Securities, in their
capacities as such, shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.
-35-
(b) For so long as any Preferred Securities remain Outstanding, if, upon a
Indenture Event of Default, the Indenture Trustee fails or the holders of not
less than 25% in principal amount of the outstanding Debentures fail to declare
the principal of all of the Debentures to be immediately due and payable, the
Holders of at least 25% in Liquidation Amount of the Preferred Securities then
Outstanding shall have such right by a notice in writing to the Depositor and
the Indenture Trustee; and upon any such declaration such principal amount of
and the accrued interest on all of the Debentures shall become immediately due
and payable as set forth in the Indenture, provided that the payment of
principal and interest on such Debentures shall remain subordinated to the
extent provided in the Indenture. At any time after such a declaration of
acceleration with respect to the Debentures has been made and before a judgment
or decree for payment of the money due has been obtained by the Indenture
Trustee as described in the Indenture, the Holders of a majority in Liquidation
Amount of the Preferred Securities, by written notice to the Property Trustee,
the Depositor and the Indenture Trustee, may rescind and annul such declaration
and its consequences if: (i) the Depositor has paid or deposited with the
Indenture Trustee a sum sufficient to pay (A) all overdue installments of
interest (including any Additional Interest (as defined in the Indenture)) on
all of the Debentures, (B) the principal of any Debentures which have become due
otherwise than by such declaration of acceleration and interest thereon at the
rate borne by the Debentures and (C) all sums paid or advanced by the Indenture
Trustee under the Indenture and the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee and the Property Trustee,
their agents and counsel; and (ii) all Events of Default with respect to the
Debentures, other than the non-payment of the principal of the Debentures which
has become due solely by such acceleration, have been cured or waived as
provided in Section 5.13 of the Indenture.
(c) The Holders of a majority in aggregate Liquidation Amount of the
Preferred Securities may, on behalf of the Holders of all the Preferred
Securities, waive any past default under the Indenture, except a default in the
payment of principal or interest (unless all Events of Default with respect to
the Debentures, other than the non-payment of the principal of the Debentures
which has become due solely by such acceleration, have been cured or annulled as
provided in Section 5.13 of the Indenture and the Depositor has paid or
deposited with the Indenture Trustee a sum sufficient to pay all overdue
installments of interest (including any Additional Interest) on the Debentures,
the principal of any Debentures which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate borne by the
Debentures, and all sums paid or advanced by the Indenture Trustee under the
Indenture and the reasonable compensation, expenses, disbursements and advances
of the Indenture Trustee and the Property Trustee, their agents and counsel) or
a default in respect of a covenant or provision which under the Indenture cannot
be modified or amended without the consent of the holder of each outstanding
Debenture. No such rescission shall affect any subsequent default or impair any
right consequent thereon.
-36-
(d) Upon receipt by the Property Trustee of written notice declaring such
an acceleration, or rescission and annulment thereof, by Holders of the
Preferred Securities all or part of which is represented by Preferred Securities
Certificates, a record date shall be established for determining Holders of
Outstanding Preferred Securities entitled to join in such notice, which record
date shall be at the close of business on the day the Property Trustee receives
such notice. The Holders of Outstanding Preferred Securities on such record
date, or their duly designated proxies, and only such Persons, shall be entitled
to join in such notice, whether or not such Holders remain Holders after such
record date; provided, that, unless such declaration of acceleration, or
rescission and annulment, as the case may be, shall have become effective by
virtue of the requisite percentage having joined in such notice prior to the day
which is 90 days after such record date, such notice of declaration of
acceleration, or rescission and annulment, as the case may be, shall
automatically and without further action by any Holder be canceled and of no
further effect. Nothing in this paragraph shall prevent a Holder, or a proxy of
a Holder, from giving, after expiration of such 90-day period, a new written
notice of declaration of acceleration, or rescission and annulment thereof, as
the case may be, that is identical to a written notice that has been canceled
pursuant to the proviso to the preceding sentence, in which event a new record
date shall be established pursuant to the provisions of this Section 5.13(d).
(e) Without limiting the generality of the foregoing, the Holders of a
majority in aggregate Liquidation Amount of the Preferred Securities will have
the right to appoint a Special Administrative Trustee under the circumstances
described in Section 6.1(d), who shall have the same rights, powers and
privileges as the other Administrative Trustees.
(f) For so long as any Preferred Securities remain Outstanding, to the
fullest extent permitted by law and subject to the terms of this Trust Agreement
and the Indenture, upon an Indenture Event of Default specified in Section
5.1(1) or 5.1(2) of the Indenture, any Holder of Preferred Securities shall have
the right to institute a proceeding directly against the Depositor, pursuant to
Section 5.8 of the Indenture, for enforcement of payment to such Holder of the
principal amount of or interest on Debentures having a principal amount equal to
the Liquidation Amount of the Preferred Securities of such Holder (a "Direct
Action"). Except as set forth in this Section 5.13, the Holders of Preferred
Securities shall have no right to exercise directly any right or remedy
available to the holders of, or in respect of, the Debentures.
-37-
ARTICLE VI
ACTS OF HOLDERS; MEETINGS; VOTING
SECTION 6.1. LIMITATIONS ON VOTING RIGHTS.
(a) Except as provided in this Section 6.1, in Sections 5.13, 8.10 and 11.3
of the Trust Agreement and as otherwise required by law, no Holder of Preferred
Securities shall have any right to vote or in any manner otherwise control the
administration, operation and management of the Trust or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Trust Securities Certificates, be construed so as to constitute the
Holders from time to time as partners or members of an association.
(b) So long as any Debentures are held by the Property Trustee, the
Trustees, without obtaining the prior approval of the Holders of at least a
majority in Liquidation Amount of all Outstanding Preferred Securities, shall
not: (i) direct the time, method and place of conducting any proceeding for any
remedy available to the Indenture Trustee, or executing any trust or power
conferred on the Indenture Trustee with respect to such Debentures; (ii) waive
any past default which is waiveable under Section 5.13 of the Indenture; (iii)
exercise any right to rescind or annul a declaration that the principal of all
the Debentures shall be due and payable; or (iv) consent to any amendment,
modification or termination of the Indenture or the Debentures, where such
consent shall be required; provided, however, that where a consent under the
Indenture would require the consent of each holder of Debentures affected
thereby, no such consent shall be given by the Property Trustee without the
prior written consent of each Holder of Preferred Securities. The Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of Preferred Securities, except by a subsequent vote of the Holders of Preferred
Securities. The Property Trustee shall notify all Holders of the Preferred
Securities of any notice of default received from the Indenture Trustee with
respect to the Debentures. In addition to obtaining the foregoing approvals of
the Holders of the Preferred Securities, prior to taking any of the foregoing
actions, the Administrative Trustees shall, at the expense of the Depositor,
obtain an Opinion of Counsel experienced in such matters to the effect that such
action shall not cause the Trust to fail to be classified as a grantor trust for
United States federal income tax purposes.
(c) If any proposed amendment to the Trust Agreement provides for, or the
Trustees otherwise propose to effect, (i) any action that would adversely affect
in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to the Trust Agreement or
otherwise, or (ii) the dissolution, winding-up or termination of the Trust,
other than pursuant to the terms of this Trust Agreement, then the Holders of
Outstanding Preferred Securities as a class shall be entitled to vote on such
amendment or
-38-
proposal and such amendment or proposal shall not be effective except with the
approval of the Holders of at least a majority in Liquidation Amount of the
Outstanding Preferred Securities. Notwithstanding any other provision of this
Trust Agreement, no amendment to this Trust Agreement may be made if, as a
result of such amendment, the Trust would fail to be classified as a grantor
trust for United States federal income tax purposes.
(d) If a Trust Agreement Event of Default occurs and is continuing (each,
an "Appointment Event"), then the holders of the Preferred Securities, acting as
a single class, will be entitled by the majority vote of such holders to appoint
a Special Administrative Trustee. Any holder of Preferred Securities (other than
the Depositor or any of its affiliates) shall be entitled to nominate any person
to be appointed as Special Administrative Trustee. Not later than 30 days after
such right to appoint a Special Administrative Trustee arises, the
Administrative Trustees shall convene a meeting of the holders of Preferred
Securities for the purpose of appointing a Special Administrative Trustee. If
the Administrative Trustees fail to convene such meeting within such 30-day
period, the holders of not less than 10% of the aggregate stated liquidation
amount of the outstanding Preferred Securities will be entitled to convene such
meeting. The provisions of this Agreement relating to the convening and conduct
of the meetings of the holders will apply with respect to any such meeting. Any
Special Administrative Trustee so appointed shall cease to be a Special
Administrative Trustee if the Appointment Event pursuant to which the Special
Administrative Trustee was appointed and all other Appointment Events cease to
be continuing.
SECTION 6.2. NOTICE OF MEETINGS.
Notice of all meetings of the Holders, stating the time, place and purpose
of the meeting, shall be given by the Property Trustee pursuant to Section 11.9
to each Holder of record, at his registered address, at least 15 days and not
more than 90 days before the meeting. At any such meeting, any business properly
before the meeting may be so considered whether or not stated in the notice of
the meeting. Any adjourned meeting may be held as adjourned without further
notice.
SECTION 6.3. MEETINGS OF HOLDERS.
(a) No annual meeting of Holders is required to be held. The Administrative
Trustees, however, shall call a meeting of Holders to vote on any matter upon
the written request of the Holders holding of record of 25% of the Outstanding
Preferred Securities (based upon their Liquidation Amount) and the
Administrative Trustees or the Property Trustee may, at any time in their
discretion, call a meeting of Holders to vote on any matters as to which Holders
are entitled to vote.
-39-
(b) Holders holding of record of 50% of the Outstanding Preferred
Securities (based upon their Liquidation Amount), present in person or by proxy,
shall constitute a quorum at any meeting of Holders.
(c) If a quorum is present at a meeting, an affirmative vote by the Holders
of record present, in person or by proxy, holding more than a majority of the
Outstanding Preferred Securities (based upon their Liquidation Amount) held by
Holders of record of Outstanding Preferred Securities present, either in person
or by proxy, at such meeting shall constitute the action of the Holders, unless
this Trust Agreement requires a greater number of affirmative votes.
SECTION 6.4. VOTING RIGHTS.
Holders shall be entitled to one vote for each $50 of Liquidation Amount
represented by their Trust Securities in respect of any matter as to which such
Holders are entitled to vote.
SECTION 6.5. PROXIES, ETC.
At any meeting of Holders, any Holder entitled to vote thereat may vote by
proxy, provided that no proxy shall be voted at any meeting unless it shall have
been placed on file with the Administrative Trustees, or with such other officer
or agent of the Trust as the Administrative Trustees may direct, for
verification prior to the time at which such vote shall be taken. Pursuant to a
resolution of the Property Trustee, proxies may be solicited in the name of the
Property Trustee or one or more officers of the Property Trustee. Only Holders
of record shall be entitled to vote. When Trust Securities are held jointly by
several Persons, any one of them may vote at any meeting in person or by proxy
in respect of such Trust Securities, but if more than one of them shall be
present at such meeting in person or by proxy, and such joint owners or their
proxies so present disagree as to any vote to be cast, such vote shall not be
received in respect of such Trust Securities. A proxy purporting to be executed
by or on behalf of a Holder shall be deemed valid unless challenged at or prior
to its exercise, and the burden of proving invalidity shall rest on the
challenger. No proxy shall be valid more than three years after its date of
execution.
SECTION 6.6. HOLDER ACTION BY WRITTEN CONSENT.
Any action which may be taken by Holders at a meeting may be taken without
a meeting if Holders holding a majority of all Outstanding Trust Securities
(based upon their Liquidation Amount) entitled to vote in respect of such action
(or such larger proportion thereof as shall be required by any express provision
of this Trust Agreement) shall consent to the action in writing. Prompt notice
of the action taken shall be given by the Holders to the
-40-
Property Trustee and the Depositor, and the Property Trustee shall give notice
within 90 days of its receipt thereof by regular mail to all Holders entitled to
vote who have not consented in writing.
SECTION 6.7. RECORD DATE FOR VOTING AND OTHER PURPOSES.
For the purposes of determining the Holders who are entitled to notice of
and to vote at any meeting or by written consent, or to participate in any
Distribution on the Trust Securities in respect of which a record date is not
otherwise provided for in this Trust Agreement, or for the purpose of any other
action, the Administrative Trustees may from time to time fix a date, not more
than 90 days prior to the date of any meeting of Holders or the payment of a
Distribution or other action, as the case may be, as a record date for the
determination of the identity of the Holders of record for such purposes.
SECTION 6.8. ACTS OF HOLDERS.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Trust Agreement to be given, made
or taken by Holders or Owners may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders or Owners in
person or by an agent duly appointed in writing; and, except as otherwise
expressly provided herein, such action shall become effective when such
instrument or instruments are delivered to an Administrative Trustee. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders or Owners
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Trust Agreement and (subject to Section 8.1) conclusive in favor
of the Trustees, if made in the manner provided in this Section 6.8.
(b) The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which any Trustee receiving the same deems sufficient.
(c) The ownership of Preferred Securities shall be proved by the Securities
Register.
-41-
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of a Holder of any Trust Security shall bind every future Holder of
the same Trust Security and the Holder of every Trust Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustees or the
Trust in reliance thereon, whether or not notation of such action is made upon
such Trust Security.
(e) Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
(f) If any dispute shall arise between the Holders and the Administrative
Trustees or among such Holders or Trustees with respect to the authenticity,
validity or binding nature of any request, demand, authorization, direction,
consent, waiver or other Act of such Holder or Trustee under this Article VI,
then the determination of such matter by the Property Trustee shall be
conclusive with respect to such matter.
SECTION 6.9. INSPECTION OF RECORDS.
Upon reasonable notice to the Administrative Trustees and the Property
Trustee, the records of the Trust shall be open to inspection by Holders during
normal business hours for any purpose reasonably related to such Holder's
interest as a Holder.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. REPRESENTATIONS AND WARRANTIES OF PROPERTY TRUSTEE AND
DELAWARE TRUSTEE.
The Property Trustee and the Delaware Trustee each on behalf of and as to
itself, hereby represents and warrants for the benefit of the Depositor and the
Holders that:
(a) the Delaware Trustee is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware;
(b) the Delaware Trustee has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust
Agreement and has taken
-42-
all necessary action to authorize the execution, delivery and performance
by it of this Trust Agreement;
(c) the Property Trustee is a Delaware banking corporation duly
organized, validly existing and in good standing in the State of Delaware;
(d) the Property Trustee has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;
(e) this Trust Agreement has been duly authorized, executed and
delivered by the Property Trustee and, assuming due authorization,
execution and delivery by the other parties hereto, constitutes the valid
and legally binding agreement of the Property Trustee enforceable against
it in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles;
(f) the execution, delivery and performance of this Trust Agreement
has been duly authorized by all necessary corporate or other action on the
part of the Property Trustee does not require any approval of stockholders
of the Property Trustee and such execution, delivery and performance will
not (i) violate the charter or by-laws of the Property Trustee, (ii)
violate any provision of, or constitute, with or without notice or lapse of
time, a default under, or result in the creation or imposition of, any Lien
on any properties included in the Trust Property (other than as
contemplated by this Trust Agreement) pursuant to the provisions of, any
indenture, mortgage, credit agreement, license or other agreement or
instrument to which the Property Trustee is a party or by which it is
bound, or (iii) violate any law, governmental rule or regulation of the
State of Delaware, as the case may be, governing the banking, trust or
general powers of the Property Trustee (as appropriate in context) or any
order, judgment or decree applicable to the Property Trustee;
(g) neither the authorization, execution or delivery by the Property
Trustee of this Trust Agreement nor the consummation of any of the
transactions by the Property Trustee contemplated herein or therein
requires the consent or approval of, the giving of notice to, the
registration with or the taking of any other action with respect to any
governmental authority or agency under any existing law or regulation or
Delaware law governing the banking, trust or general powers of the Property
Trustee, as the case may be; and
-43-
(h) there are no proceedings pending or, to the best of the Property
Trustee's knowledge, threatened against or affecting the Property Trustee
in any court or before any governmental authority, agency or arbitration
board or tribunal which, individually or in the aggregate, would materially
and adversely affect the Trust or would question the right, power and
authority of the Property Trustee, as the case may be, to enter into or
perform its obligations as one of the Trustees under this Trust Agreement.
ARTICLE VIII
THE TRUSTEES
SECTION 8.1. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) The duties and responsibilities of the Trustees shall be as provided by
this Trust Agreement and, in the case of the Property Trustee, by the Trust
Indenture Act. Notwithstanding the foregoing, no provision of this Trust
Agreement shall require the Trustees to expend or risk their own funds or
otherwise incur any financial liability in the performance of any of their
duties hereunder, or in the exercise of any of their rights or powers, if they
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
them. Whether or not therein expressly so provided, every provision of this
Trust Agreement relating to the conduct or affecting the liability of or
affording protection to the Trustees shall be subject to the provisions of this
Section 8.1. Nothing in this Trust Agreement shall be construed to release an
Administrative Trustee from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct. To the extent that, at
law or in equity, an Administrative Trustee has duties (including fiduciary
duties) and liabilities relating thereto to the Trust or to the Holders, such
Administrative Trustee shall not be liable to the Trust or to any Holder for
such Trustee's good faith reliance on the provisions of this Trust Agreement.
The provisions of this Trust Agreement, to the extent that they restrict the
duties and liabilities of the Administrative Trustees otherwise existing at law
or in equity, replace such other duties and liabilities of the Administrative
Trustees.
(b) All payments made by the Property Trustee or a Paying Agent in respect
of the Trust Securities shall be made only from the revenue and proceeds from
the Trust Property and only to the extent that there shall be sufficient revenue
or proceeds from the Trust Property to enable the Property Trustee or a Paying
Agent to make payments in accordance with the terms hereof. Each Holder, by its
acceptance of a Trust Security, agrees that it shall look solely to the revenue
and proceeds from the Trust Property to the extent legally available for
distribution to it as herein provided and that the Trustees are not personally
liable to it for any
-44-
amount distributable in respect of any Trust Security or for any other liability
in respect of any Trust Security. This Section 8.1(b) does not limit the
liability of the Trustees expressly set forth elsewhere in this Trust Agreement
or, in the case of the Property Trustee, in the Trust Indenture Act.
(c) No provision of this Trust Agreement 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) the Property Trustee shall not be liable for any error of judgment
made in good faith by an authorized officer of the Property Trustee, unless
it shall be proved that the Property Trustee was negligent in ascertaining
the pertinent facts;
(ii) the Property Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders of not less than a majority in Liquidation
Amount of the Trust 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 Trust Agreement;
(iii) the Property Trustee's sole duty with respect to the custody,
safe keeping and physical preservation of the Debentures and the Payment
Account shall be to deal with such property in a similar manner as the
Property Trustee deals with similar property for its own account, subject
to the protections and limitations on liability afforded to the Property
Trustee under this Trust Agreement and the Trust Indenture Act;
(iv) the Property Trustee shall not be liable for any interest on any
money received by it except as it may otherwise agree in writing with the
Depositor; and money held by the Property Trustee need not be segregated
from other funds held by it except in relation to the Payment Account
maintained by the Property Trustee pursuant to Section 3.1 and except to
the extent otherwise required by law; and
(v) the Property Trustee shall not be responsible for monitoring the
compliance by the Administrative Trustees or the Depositor with their
respective duties under this Trust Agreement, nor shall the Property
Trustee be liable for the default or misconduct of the Administrative
Trustees or the Depositor.
SECTION 8.2. CERTAIN NOTICES.
(a) Within ten Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit, in
the manner and to
-45-
the extent provided in Section 11.9, notice of such Event of Default to the
Holders, the Administrative Trustees and the Depositor, unless such Event of
Default shall have been cured or waived.
(b) Within five Business Days after the receipt of notice of the
Depositor's exercise of its right to defer the payment of interest on the
Debentures pursuant to the Indenture, the Administrative Trustee shall transmit,
in the manner and to the extent provided in Section 11.9, notice of such
exercise to the Holders and the Property Trustee, unless such exercise shall
have been revoked.
SECTION 8.3. CERTAIN RIGHTS OF PROPERTY TRUSTEE.
Subject to the provisions of Section 8.1:
(a) the Property Trustee may rely and shall be protected in acting or
refraining from acting in good faith upon any resolution, Opinion of
Counsel, certificate, written representation of a Holder or transferee,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) if (i) in performing its duties under this Trust Agreement the
Property Trustee is required to decide between alternative courses of
action, (ii) in construing any of the provisions of this Trust Agreement
the Property Trustee finds the same ambiguous or inconsistent with any
other provisions contained herein or (iii) the Property Trustee is unsure
of the application of any provision of this Trust Agreement, then, except
as to any matter as to which the Holders are entitled to vote under the
terms of this Trust Agreement, the Property Trustee shall deliver a notice
to the Depositor requesting written instructions of the Depositor as to the
course of action to be taken and the Property Trustee shall take such
action, or refrain from taking such action, as the Property Trustee shall
be instructed in writing to take, or to refrain from taking, by the
Depositor; provided, however, that if the Property Trustee does not receive
such instructions of the Depositor within ten Business Days after it has
delivered such notice, or such reasonably shorter period of time set forth
in such notice (which to the extent practicable shall not be less than two
Business Days), it may, but shall be under no duty to, take or refrain from
taking such action not inconsistent with this Trust Agreement as it shall
deem advisable and in the best interests of the Holders, in which event the
Property Trustee shall have no liability except for its own bad faith,
negligence or willful misconduct;
-46-
(c) any direction or act of the Depositor or the Administrative
Trustees contemplated by this Trust Agreement shall be sufficiently
evidenced by an Officers' Certificate;
(d) whenever in the administration of this Trust Agreement, the
Property Trustee shall deem it desirable that a matter be established
before undertaking, 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 rely upon an
Officers' Certificate which, upon receipt of such request, shall be
promptly delivered by the Depositor or the Administrative Trustees;
(e) the Property Trustee shall have no duty to see to any recording,
filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(f) the Property Trustee may consult with counsel of its selection
(which counsel may be counsel to the Depositor or any of its Affiliates,
and may include any of its employees) and the advice of such counsel shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon and in accordance with such advice; and the Property Trustee shall
have the right at any time to seek instructions concerning the
administration of this Trust Agreement from any court of competent
jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Trust Agreement at the request
or direction of any of the Holders pursuant to this Trust Agreement, unless
such Holders shall have offered to the Property Trustee reasonable security
or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(h) the Property Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
bond, debenture, note or other evidence of indebtedness or other paper or
document, unless requested in writing to do so by one or more Holders, but
the Property Trustee may make such further inquiry or investigation into
such facts or matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
its agents or attorneys,
-47-
provided that the Property Trustee shall be responsible for its own
negligence or recklessness with respect to selection of any agent or
attorney appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable to receive written instructions
with respect to enforcing any remedy or right or taking any other action
hereunder, the Property Trustee (i) may request written instructions from
the Holders of the Trust Securities, which written instructions may only be
given by the Holders of the same proportion in Liquidation Amount of the
Trust Securities as would be entitled to direct the Property Trustee under
the terms of the Trust 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 written instructions are received and (iii) shall
be protected in acting in accordance with such written instructions;
(k) except as otherwise expressly provided by this Trust Agreement,
the Property Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Trust Agreement; and
(l) any 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 Trust Agreement, both of which
shall be conclusively evidenced by the Property Trustee's or its agent's
taking such action.
No provision of this Trust Agreement shall be deemed to impose any duty or
obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
SECTION 8.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Trust, and the Trustees do not assume
any responsibility for their correctness. The Trustees shall not be accountable
for the use or application by the Depositor of the proceeds of the Debentures.
-48-
SECTION 8.5. MAY HOLD SECURITIES.
Any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other capacity, may become the owner or pledgee of Trust
Securities and, subject to Sections 8.8 and 8.13, except as provided in the
definition of the term "Outstanding" in Article I, may otherwise deal with the
Trust with the same rights it would have if it were not a Trustee or such other
agent.
SECTION 8.6. COMPENSATION; INDEMNITY; FEES.
The Depositor, as borrower, agrees:
(a) to pay to the Trustees from time to time such compensation as
shall be agreed in writing with the Depositor for all services rendered by
them hereunder (which compensation shall not be limited by any provision of
law in regard to the compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and
advances incurred or made by the Trustees in accordance with any provision
of this Trust Agreement (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negligence
or bad faith; and
(c) to the fullest extent permitted by applicable law, to indemnify
and hold harmless (i) each Trustee, (ii) any Affiliate of any Trustee,
(iii) any officer, director, shareholder, employee, representative or agent
of any Trustee and (iv) any employee or agent of the Trust or its
Affiliates (referred to herein as an "Indemnified Person") from and against
any and all loss, damage, liability, tax, penalty, expense or claim of any
kind or nature whatsoever incurred by such Indemnified Person by reason of
the creation, operation or termination of the Trust or 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 authority conferred on such Indemnified Person by this
Trust Agreement, except that no Indemnified Person shall be entitled to be
indemnified in respect of any loss, damage or claim incurred by such
Indemnified Person by reason of negligence or willful misconduct with
respect to such acts or omissions. When the Property Trustee incurs
expenses or renders services in connection with an Event of Default
specified in Section 5.1(4) or Section 5.1(5) of the Indenture, the
expenses (including the reasonable charges and expenses of its counsel) and
the compensation for the services are intended to constitute ex-
-49-
penses of administration under any applicable federal or state bankruptcy,
insolvency or other similar law.
(d) The provisions of this Section 8.6 shall survive the termination
of this Trust Agreement.
(e) No Trustee may claim any lien or charge on any Trust Property as a
result of any amount due pursuant to this Section 8.6.
(f) The Depositor and any Trustee (in the case of the Property
Trustee, subject to Section 8.8 hereof) may engage in or possess an
interest in other business ventures of any nature or description,
independently or with others, similar or dissimilar to the business of the
Trust, and the Trust and the Holders of Trust Securities shall have no
rights by virtue of this Trust Agreement in and to such independent
ventures or the income or profits derived therefrom, and the pursuit of any
such venture, even if competitive with the business of the Trust, shall not
be deemed wrongful or improper. Neither the Depositor nor any 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 the Depositor and any 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 Trustee may engage or be interested in
any financial or other transaction with the Depositor or any Affiliate of
the Depositor, or may act as depository for, trustee or agent for, or act
on any committee or body of Holders of, securities or other obligations of
the Depositor or its Affiliates.
SECTION 8.7. CORPORATE PROPERTY TRUSTEE REQUIRED; ELIGIBILITY OF TRUSTEES.
(a) There shall at all times be a Property Trustee hereunder with respect
to the Trust Securities. The Property Trustee shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such and has a combined capital
and surplus of at least $50,000,000. If any such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then for the purposes of this Section 8.7,
the combined capital and surplus of such Person shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Property Trustee with respect to the Trust
Securities shall cease to be eligible in accordance with the provisions of this
Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article VIII. The Property Trustee may also act as
the Delaware Trustee if so eligible under clause (c) of this Section 8.7.
-50-
(b) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized to bind that
entity.
(c) There shall at all times be a Delaware Trustee with respect to the
Trust Securities. The Delaware Trustee shall either be (i) a natural person who
is at least 21 years of age and a resident of the State of Delaware or (ii) a
legal entity with its principal place of business in the State of Delaware and
that otherwise meets the requirements of applicable Delaware law that shall act
through one or more persons authorized to bind such entity. The Delaware Trustee
may also act as the Property Trustee if so eligible under clause (a) if this
Section 8.7.
SECTION 8.8. CONFLICTING INTERESTS.
If the Property Trustee has or shall acquire a conflicting interest within
the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement.
SECTION 8.9. CO-TRUSTEES AND SEPARATE TRUSTEE.
(a) 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 Depositor and the Administrative
Trustees, by agreed action of the majority of such Trustees, shall have power to
appoint, and upon the written request of the Administrative Trustees, the
Depositor shall for such purpose join with the Administrative Trustees in the
execution, delivery and performance of all instruments and agreements necessary
or proper to appoint, one or more Persons approved by the Property Trustee
either to act as co-trustee, jointly with the Property Trustee, of all or any
part of such Trust Property, or to the extent required by law 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 the
capacity aforesaid, any property, title, right or power deemed necessary or
desirable, subject to the other provisions of this Section 8.9. If the Depositor
does not join in such appointment within 15 days after the receipt by it of a
request so to do, or in case an Indenture Event of Default has occurred and is
continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section 8.9 shall either be (i) a natural person who is at least 21 years of age
and a resident of the United States or (ii) a legal entity with its principal
place of business in the United States that shall act through one or more
persons authorized to bind such entity. Should any written instrument from the
-51-
Depositor be required by any co-trustee or separate trustee so appointed for
more fully confirming to such co-trustee or separate trustee such property,
title, right, or power, any and all such instruments shall, on request, be
executed, acknowledged and delivered by the Depositor.
(b) Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following terms,
namely:
(i) The Trust Securities shall be executed and delivered and all
rights, powers, duties, and obligations hereunder in respect of the custody
of securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustees specified hereunder shall be
exercised solely by such Trustees and not by such co-trustee or separate
trustee.
(ii) The rights, powers, duties, and obligations hereby conferred or
imposed upon the Property Trustee in respect of any property covered by
such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such
co-trustee or separate trustee jointly, as shall be provided in the
instrument appointing such co-trustee or separate trustee, except to the
extent that under any law of any jurisdiction in which any particular act
is to be performed, the Property Trustee shall be incompetent or
unqualified to perform such act, in which event such rights, powers, duties
and obligations shall be exercised and performed by such co-trustee or
separate trustee.
(iii) The Property Trustee at any time, by an instrument in writing
executed by it, with the written concurrence of the Depositor, may accept
the resignation of or remove any co-trustee or separate trustee appointed
under this Section 8.9, and, in case an Indenture Event of Default has
occurred and is continuing, the Property Trustee shall have power to accept
the resignation of, or remove, any such co-trustee or separate trustee
without the concurrence of the Depositor. Upon the written request of the
Property Trustee, the Depositor shall join with the Property Trustee in the
execution, delivery and performance of all instruments and agreements
necessary or proper to effectuate such resignation or removal. A successor
to any co-trustee or separate trustee so resigned or removed may be
appointed in the manner provided in this Section 8.9.
(iv) No co-trustee or separate trustee hereunder shall be personally
liable by reason of any act or omission of the Property Trustee or any
other trustee hereunder.
(v) The Property Trustee shall not be liable by reason of any act of a
co-trustee or separate trustee.
-52-
(vi) Any Act of Holders delivered to the Property Trustee shall be
deemed to have been delivered to each such co-trustee and separate trustee.
SECTION 8.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of any Trustee (the "Relevant Trustee") and
no appointment of a successor Trustee pursuant to this Article VIII shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 8.11.
(b) Subject to Section 8.10(a), the Relevant Trustee may resign at any time
by giving written notice thereof to the Holders. If the instrument of acceptance
by the successor Trustee required by Section 8.11 shall not have been delivered
to the Relevant Trustee within 30 days after the giving of such notice of
resignation, the Relevant Trustee may petition, at the expense of the Trust, any
court of competent jurisdiction for the appointment of a successor Relevant
Trustee.
(c) Unless an Indenture Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by Act of the Holders of
Common Securities (which such removal shall not constitute an amendment of this
Trust Agreement). If an Indenture Event of Default shall have occurred and be
continuing, the Property Trustee may be removed at such time by Act of the
Holders of a majority in Liquidation Amount of the Preferred Securities,
delivered to the Relevant Trustee (in its individual capacity and on behalf of
the Trust). An Administrative Trustee may be removed by the Holder of Common
Securities at any time. If the instrument of acceptance by the successor Trustee
required by Section 8.11 shall not have been delivered to the Relevant Trustee
within 30 days after such removal, the Relevant Trustee may petition, at the
expense of the Trust, any court of competent jurisdiction for the appointment of
a successor Relevant Trustee.
(d) If any Trustee shall resign, be removed or become incapable of acting
as Trustee, or if a vacancy shall occur in the office of any Trustee for any
cause, at a time when no Indenture Event of Default shall have occurred and be
continuing, the Holder of Common Securities, by Act of the Holder of Common
Securities delivered to the retiring Trustee, shall promptly appoint a successor
Trustee or Trustees, and the retiring Trustee shall comply with the applicable
requirements of Section 8.11. If the Property Trustee shall resign, be removed
or become incapable of continuing to act as the Property Trustee at a time when
a Indenture Event of Default shall have occurred and be continuing, the Holders,
by Act of the Holders holding a majority in Liquidation Amount of the Preferred
Securities then Outstanding delivered to the retiring Relevant Trustee, shall
promptly appoint a successor Relevant Trustee or Trustees, and such successor
Trustee shall comply with the applicable requirements of Section
-53-
8.11. If an Administrative Trustee shall resign, be removed or become incapable
of acting as Administrative Trustee, at a time when an Indenture Event of
Default shall have occurred and be continuing, the Holder of Common Securities
by Act of the Holder of Common Securities delivered to the Administrative
Trustee shall promptly appoint a successor Administrative Trustee or
Administrative Trustees and such successor Administrative Trustee or Trustees
shall comply with the applicable requirements of Section 8.11. If no successor
Relevant Trustee shall have been so appointed by the Holder of Common Securities
or the Holders and accepted appointment in the manner required by Section 8.11,
any Holder who has been a Holder of Trust Securities for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Relevant Trustee.
(e) The Property Trustee shall give notice of each resignation and each
removal of a Trustee and each appointment of a successor Trustee to all Holders
in the manner provided in Section 11.9 and shall give notice to the Depositor.
Each notice shall include the name of the successor Relevant Trustee and the
address of its Corporate Trust Office if it is the Property Trustee.
(f) Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee who is a natural person dies
or becomes, in the opinion of the Depositor, incompetent or incapacitated, the
vacancy created by such death, incompetence or incapacity may be filled by (i)
the unanimous act of the remaining Administrative Trustees if there are at least
two of them or (ii) otherwise by the Depositor (with the successor in each case
being a Person who satisfies the eligibility requirement for Administrative
Trustees set forth in Section 8.7).
SECTION 8.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
In case of the appointment hereunder of a successor Relevant Trustee, the
retiring Relevant Trustee and each successor Relevant Trustee with respect to
the Trust Securities shall execute and deliver an amendment hereto wherein each
successor Relevant Trustee shall accept such appointment and which (a) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Relevant Trustee all the rights,
powers, trusts and duties of the retiring Relevant Trustee with respect to the
Trust Securities and the Trust and (b) shall add to or change any of the
provisions of this Trust Agreement as shall be necessary to provide for or
facilitate the administration of the Trust by more than one Relevant Trustee, it
being understood that nothing herein or in such amendment shall constitute such
Relevant Trustees co-trustees and upon the execution and delivery of such
amendment the resignation or removal of the retiring Relevant Trustee shall
become effective to the extent provided therein and each such successor Relevant
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and
-54-
duties of the retiring Relevant Trustee; but, on written request of the Trust or
any successor Relevant Trustee such retiring Relevant Trustee shall duly assign,
transfer and deliver to such successor Relevant Trustee all Trust Property, all
proceeds thereof and funds held by such retiring Relevant Trustee hereunder with
respect to the Trust Securities and the Trust. Upon written request of any such
successor Relevant Trustee, the Trust shall execute any and all instruments for
more fully and certainly vesting in and confirming to such successor Relevant
Trustee all such rights, powers and trusts referred to in this Section 8.11. No
successor Relevant Trustee shall accept its appointment unless at the time of
such acceptance such successor Relevant Trustee shall be qualified and eligible
under this Article.
SECTION 8.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any Person into which the Property Trustee may be merged or converted or
with which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which such Relevant Trustee shall be a party, or
any Person succeeding to all or substantially all the corporate trust business
of such Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder, provided such Person shall be otherwise qualified and eligible under
this Article VIII, without the execution or filing of any paper or any further
act on the part of any of the parties hereto.
SECTION 8.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR OR TRUST.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Trust or any other obligor upon the
Trust Securities or the property of the Trust or of such other obligor or their
creditors, the Property Trustee (irrespective of whether any Distributions on
the Trust Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Property Trustee shall
have made any demand on the Trust for the payment of any past due Distributions)
shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(i) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Trust Securities and to
file such other papers or documents as may be necessary or advisable in
order to have the claims of the Property Trustee (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Property Trustee, its agents and counsel) and of the Holders allowed in
such judicial proceeding, and
-55-
(ii) to collect and receive any money or other property payable or
deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Property Trustee and, in the event
the Property Trustee shall consent to the making of such payments directly
to the Holders, to pay to the Property Trustee any amount due it for the
reasonable compensation, expenses, disbursements and advances of the
Property Trustee, its agents and counsel, and any other amounts due the
Property Trustee. Nothing herein contained shall be deemed to authorize the
Property Trustee to authorize or consent to or accept or adopt on behalf of
any Holder any plan of reorganization, arrangement adjustment or
compensation affecting the Trust Securities or the rights of any Holder
thereof or to authorize the Property Trustee to vote in respect of the
claim of any Holder in any such proceeding.
SECTION 8.14. REPORTS BY PROPERTY TRUSTEE.
(a) The Property Trustee shall transmit to Holders such reports concerning
the Property Trustee and its actions under this Trust Agreement as may be
required pursuant to the Trust Indenture Act at the times and in the manner
provided pursuant thereto. If required by Section 313(a) of the Trust Indenture
Act, the Property Trustee shall, within 60 days after each May 15 following the
date of this Trust Agreement, deliver to Holders a brief report, dated as of
such May 15, which complies with the provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Property Trustee with each national stock exchange, the
Nasdaq National Market or such other interdealer quotation system or
self-regulatory organization upon which the Preferred Securities are listed or
traded, if any, with the Commission and with the Depositor. The Depositor will
promptly notify the Property Trustee of any such listing or trading.
SECTION 8.15. REPORTS TO PROPERTY TRUSTEE.
The Depositor and the Administrative Trustees on behalf of the Trust shall
provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314(a) of the Trust Indenture Act in the form,
in the manner and at the times required by Section 314 of the Trust Indenture
Act. Delivery of such reports, information and documents to the Property Trustee
is for informational purposes only and the Property Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Trust's
compliance with any of its
-56-
covenants hereunder (as to which the Property Trustee is entitled to rely
exclusively on Officers' Certificates).
SECTION 8.16. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
Each of the Depositor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Trust Agreement that relate
to any of the matters set forth in Section 314(c) of the Trust Indenture Act.
Any certificate or opinion required to be given by an officer pursuant to
Section 314(c)(1) of the Trust Indenture Act shall be given in the form of an
Officers' Certificate.
SECTION 8.17. NUMBER OF TRUSTEES.
(a) The number of Trustees shall be five (four if the Property Trustee and
the Delaware Trustee are the same Person), provided that the Holder of all of
the Common Securities by written instrument may increase or decrease the number
of Administrative Trustees and provided that the number of Trustees may be
increased to add a Special Administrative Trustee. The Property Trustee and the
Delaware Trustee may be the same Person.
(b) If a Trustee ceases to hold office for any reason and the number of
Administrative Trustees is not reduced pursuant to Section 8.17(a), or if the
number of Trustees is increased pursuant to Section 8.17(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy, incompetence
or incapacity to perform the duties of a Trustee shall not operate to dissolve,
terminate or annul the Trust. Whenever a vacancy in the number of Administrative
Trustees shall occur, until such vacancy is filled by the appointment of an
Administrative Trustee in accordance with Section 8.10, the Administrative
Trustees in office, regardless of their number (and notwithstanding any other
provision of this Trust Agreement), shall have all the powers granted to the
Administrative Trustees and shall discharge all the duties imposed upon the
Administrative Trustees by this Trust Agreement.
SECTION 8.18. 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
2.8, including any registration
-57-
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 the Depositor the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the 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 Trust Agreement, as set forth herein.
ARTICLE IX
DISSOLUTION, LIQUIDATION, TERMINATION AND MERGER
SECTION 9.1. TERMINATION UPON EXPIRATION DATE.
Unless earlier terminated, the Trust shall automatically dissolve on July
1, 2005 (the "Expiration Date"), following the distribution of the Trust
Property in accordance with Section 9.4.
SECTION 9.2. EARLY TERMINATION.
The first to occur of any of the following events is an "Early Termination
Event":
(a) the occurrence of a Bankruptcy Event in respect of the Holder of
the Common Securities, or the filing by the Holder of Common Securities of
a certificate of dissolution or its equivalent with respect to the Holder
of Common Securities (except for permitted mergers, consolidations or
reorganizations of the Holder of Common Securities) or the revocation of
the charter of the Holder of Common Securities and the expiration of 90
days after the date of such revocation without reinstatement thereof;
(b) the occurrence of (i) a Tax Event, but only if the Administrative
Trustees shall have received an opinion from independent tax counsel
experienced in such matters, which opinion may rely on published revenue
rulings of the Internal Revenue Service, to the effect that the holders of
the Preferred Securities will not recognize any gain or loss for United
States federal income tax purposes as a result of such Early Termination
Event and distribution of Debentures; unless at the time there is available
to the Trust the opportunity to eliminate, within such 90 day period, the
Tax Event by
-58-
taking some ministerial action, such as filing a form or making an
election, or pursuing some other similar reasonable measure, which has no
adverse effect on the Trust, Gentiva Health Services, Inc. or the holders
of the Preferred Securities, and the Trust pursues such measure in lieu of
dissolution; or (ii) an Investment Company Event;
(c) the redemption of all of the Preferred Securities in connection
with the redemption of all of the Debentures;
(d) the entry of an order for dissolution of the Trust by a court of
competent jurisdiction; and
(e) the distribution of Common Stock to all Holders upon conversion of
all outstanding Preferred Securities.
SECTION 9.3. TERMINATION.
The respective obligations and responsibilities of the Trustees and, to the
fullest extent permitted by applicable law, the Trust created and continued
hereby shall terminate upon the latest to occur of the following: (a) the
distribution by the Property Trustee to Holders upon the liquidation of the
Trust pursuant to Section 9.4, or upon the redemption of all of the Trust
Securities pursuant to Section 4.2 or repurchase of all the Trust Securities
pursuant to Article X, of all amounts required to be distributed hereunder upon
the final payment of the Trust Securities; (b) the payment of any expenses owed
by the Trust; and (c) the discharge of all administrative duties of the
Administrative Trustees, including the performance of any tax reporting
obligations with respect to the Trust or the Holders. Upon the completion of the
liquidation of the Trust and its termination, the Property Trustee and
Administrative Trustee shall execute and file a Certificate of Cancellation of
the Trust with the Secretary of State of the State of Delaware.
SECTION 9.4. LIQUIDATION.
(a) If an Early Termination Event specified in clause (a), (b) or (d) of
Section 9.2 occurs or upon the Expiration Date, the Trust shall be liquidated by
the Trustees as expeditiously as the Trustees determine to be possible by
distributing, after satisfaction or the making of reasonable provisions for the
payment of liabilities to creditors of the Trust as provided by applicable law,
to each Holder a Like Amount of Debentures, subject to Section 9.4(d). Notice of
liquidation shall be given by the Property Trustee by first-class mail, postage
prepaid mailed not later than 30 nor more than 60 days prior to the Liquidation
Date to each Holder of Trust Securities at such Holder's address appearing in
the Securities Register. All notices of liquidation shall:
-59-
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent a Like Amount of Debentures; and
(iii) provide such information with respect to the mechanics by which
Holders may exchange Trust Securities Certificates for Debentures or, if
Section 9.4(d) applies, receive a Liquidation Distribution, as the
Administrative Trustees or the Property Trustee shall deem appropriate.
(b) Except where Section 9.2(c) or 9.2(e) applies, in order to effect the
liquidation of the Trust and distribution of the Debentures to Holders, the
Property Trustee shall establish a record date for such distribution (which
shall be not more than 45 days prior to the Liquidation Date) and, either itself
acting as exchange agent or through the appointment of a separate exchange
agent, shall establish such procedures as it shall deem appropriate to effect
the distribution of Debentures in exchange for the Outstanding Trust Securities
Certificates.
(c) Except where Section 9.2(c) or 9.2(e) applies, after the Liquidation
Date, (i) the Trust Securities shall no longer be deemed to be Outstanding, (ii)
certificates representing a Like Amount of Debentures shall be issued to Holders
of Trust Securities Certificates, upon surrender of such certificates to the
Administrative Trustees or their agent for exchange, (iii) the Depositor shall
use its best efforts to have the Debentures listed on any exchange, interdealer
quotation system or self-regulatory organization as the Preferred Securities are
then listed or traded, (iv) any Trust Securities Certificates not so surrendered
for exchange shall be deemed to represent a Like Amount of Debentures, accruing
interest at the rate provided for in the Debentures from the last Distribution
Date on which a Distribution was made on such Trust Securities Certificates
until such certificates are so surrendered (and until such certificates are so
surrendered, no payments of interest or principal will be made to Holders of
Trust Securities Certificates with respect to such Debentures), and (v) all
rights of Holders holding Trust Securities shall cease, except the right of such
Holders to receive Debentures upon surrender of Trust Securities Certificates.
(d) In the event that, notwithstanding the other provisions of this Section
9.4, whether because of an order for dissolution entered by a court of competent
jurisdiction or otherwise, distribution of the Debentures in the manner provided
herein is determined by the Property Trustee not to be practical, the Trust
Property shall be liquidated, and the Trust shall be wound-up or terminated, by
the Property Trustee. In such event, Holders will be entitled to receive out of
the assets of the Trust available for distribution to Holders, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, an amount equal to the Liquidation Amount per Trust Security plus
accumulated and unpaid Distributions thereon to the
-60-
date of payment (such amount being the "Liquidation Distribution"). If, upon any
such winding up or termination, the Liquidation Distribution can be paid only in
part because the Trust has insufficient assets available to pay in full the
aggregate Liquidation Distribution, then, subject to the next succeeding
sentence, the amounts payable by the Trust on the Trust Securities shall be paid
on a pro rata basis (based upon Liquidation Amounts). The Holder of the Common
Securities shall be entitled to receive Liquidation Distributions upon any such
winding-up or termination pro rata (determined as aforesaid) with Holders of
Preferred Securities, except that, if a Indenture Event of Default has occurred
and is continuing, the Preferred Securities shall have a priority over the
Common Securities.
SECTION 9.5. MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF
TRUST.
The Trust may not consolidate, amalgamate, merge with or into, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other Person, except pursuant
to this Article IX. At the request of the Depositor, with the consent of the
Administrative Trustees and without the consent of the Holders of the Preferred
Securities, the Property Trustee or the Delaware Trustee, the Trust may
consolidate, amalgamate, merge with or into, or be replaced by or convey,
transfer or lease its properties and assets substantially as an entirety to a
trust organized as such under the laws of any State; provided, that (i) such
successor entity either (a) expressly assumes all of the obligations of the
Trust with respect to the Preferred Securities or (b) substitutes for the
Preferred Securities other securities having substantially the same terms as the
Preferred Securities (the "Successor Securities") so long as the Successor
Securities rank the same as the Preferred Securities rank in priority with
respect to Distributions and payments upon liquidation, redemption and
otherwise, (ii) the Depositor expressly appoints a trustee of such successor
entity possessing the same powers and duties as the Property Trustee as the
holder of the Debentures, (iii) the Successor Securities are listed or traded,
or any Successor Securities shall be listed upon notification of issuance, on
any national securities exchange or other organization on which the Preferred
Securities are then listed or traded, if any, (iv) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause the
Preferred Securities (including any Successor Securities) to be downgraded by
any nationally recognized statistical rating organization, (v) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the Holders of the
Preferred Securities (including any Successor Securities) in any material
respect, (vi) such 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 Depositor has received an
Opinion of Counsel 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 of the Preferred
Securities (including any
-61-
Successor Securities) in any material respect, and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the Trust nor such successor entity will be required to register as an
investment company under the 1940 Act, and (viii) the Depositor owns all of the
common securities of such successor entity and guarantees the obligations of
such successor entity under the Successor Securities at least to the extent
provided by the Guarantee. Notwithstanding the foregoing, the Trust shall not,
except with the consent of Holders of 100% in Liquidation Amount of the
Preferred Securities, consolidate, amalgamate, merge with or into, or be
replaced by or convey, transfer or lease its properties and assets substantially
as an entirety to any other Person or permit any other 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 to be classified as other than a grantor trust for
United States federal income tax purposes.
ARTICLE X
RIGHT TO REQUIRE REPURCHASE
SECTION 10.1. RIGHT TO REQUIRE REPURCHASE.
In the event that there shall occur a Change of Control (as defined in
Section 10.6), then each Holder shall have the right, at such Holder's option,
to require the Trust to purchase, and upon the exercise of such right, the Trust
shall, subject to the provisions of Section 14.3 of the Indenture, purchase, all
or any part of such Holder's Preferred Securities on the date (the "Repurchase
Date") that is 30 days after the date the Depositor gives notice of the Change
of Control as contemplated in Section 10.2(a) at a price (the "Repurchase
Price") equal to $50 per Preferred Security, together with accrued and unpaid
Distributions, if any, to the Repurchase Date.
SECTION 10.2. NOTICE; METHOD OF EXERCISING REPURCHASE RIGHT.
(a) Within 30 days following a Change of Control (as defined in Section
10.6), the Depositor, or at the written request of the Depositor received by the
Property Trustee at least 40 days prior to the Repurchase Date, the Property
Trustee (in the name and at the expense of the Depositor), in its capacity as
tender agent (for which services it shall be reasonably compensated), shall give
notice of the occurrence of the Change of Control and of the repurchase right
set forth herein arising as a result thereof by first-class mail, postage
prepaid, to
-62-
the Property Trustee and to each Holder of the Preferred Securities at such
Holder's address appearing in the Security Register.
Each notice of a repurchase right shall state:
(1) the event constituting the Change of Control and the date thereof,
(2) the Repurchase Date,
(3) the date by which the repurchase right must be exercised,
(4) the Repurchase Price, and
(5) the instructions a Holder must follow to exercise a repurchase
right.
No failure of the Depositor to give the foregoing notice shall limit any
Holder's right to exercise a repurchase right. The Property Trustee shall have
no affirmative obligation to determine if there shall have occurred a Repurchase
Event.
(b) To exercise a repurchase right, a Holder shall deliver to the
Depositor, the Trust (or an agent designated by the Depositor for such purpose
in the notice referred to in (a) above) and to the Property Trustee on or before
the close of business on the second Business Day preceding the Repurchase Date
(i) written notice of the Holder's exercise of such right, in the form attached
hereto as Exhibit E, and (ii) the Preferred Security or Preferred Securities
with respect to which the repurchase right is being exercised, duly endorsed for
transfer to the Trust. Such written notice shall be irrevocable.
In the event a repurchase right shall be exercised in accordance with the
terms hereof, the Depositor shall on the Repurchase Date cause to be paid in
cash by the Trust to the Holder thereof the Repurchase Price of the Preferred
Security or Preferred Securities as to which the repurchase right had been
exercised. In the event that a repurchase right is exercised with respect to
less than the entire amount of Preferred Securities represented by a
Certificated Preferred Security, the Trust shall cause to be issued and executed
in the name of the Holder a new Certificated Preferred Security representing the
unrepurchased portion of such surrendered Certificated Preferred Security.
SECTION 10.3. DEPOSIT OF REPURCHASE PRICE.
On or prior to the Repurchase Date, the Depositor shall redeem Debentures
equal in aggregate principal amount to the Liquidation Amount of Preferred
Securities to be repurchased on the Repurchase Date and cause to be deposited
with the Property Trustee or with a Paying Agent an amount of money in same day
funds sufficient to pay the redemption
-63-
price therefor. The Trust shall cause such funds to be applied to the payment of
the Repurchase Price of the Preferred Securities which are to be repaid on the
Repurchase Date.
SECTION 10.4. SECURITIES NOT REPURCHASED ON REPURCHASE DATE.
If any Preferred Security surrendered for repurchase shall not be so paid
on the Repurchase Date, such Preferred Security shall, until paid, accrue
Distributions to the extent permitted by applicable law from the Repurchase Date
at the Distribution rate per annum applicable to such Preferred Security.
SECTION 10.5. SECURITIES REPURCHASED IN PART.
Any Preferred Securities, only a portion of which are to be repurchased,
shall be surrendered at any office or agency of the Property Trustee designated
for that purpose (with, if the Trust or the Property Trustee so requires, due
endorsement by, or written instrument of transfer in form satisfactory to the
Trust and the Property Trustee duly executed by, the Holder thereof or his
attorney duly authorized in writing), and the Trust shall issue to the Holder,
without service charge, a Certificated Preferred Security of any authorized
denomination as requested by such Holder, in aggregate amount equal to and in
exchange for the unrepurchased portion of Preferred Securities so surrendered.
SECTION 10.6. DEFINITIONS.
(a) A "Change in Control" shall occur when: (a) the sale, lease, transfer,
conveyance or other disposition (other than by way of merger or consolidation),
in one or a series of related transactions, or all or substantially all of the
assets of the Depositor and its subsidiaries, taken as a whole, (b) the adoption
of a plan relating to the liquidation or dissolution of the Depositor, (c) the
consummation of any transaction (including, without limitation, any merger or
consolidation) the result of which is that any "person" or "group" (as such
terms are used in Section 13(d)(3) of the Exchange Act) becomes the "beneficial
owner" (as such term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange
Act), directly or indirectly through one or more intermediaries, of more than
50% of the voting power of the outstanding voting stock of the Depositor, (d)
the Depositor consolidates with, or merges with or into, any person, or any
person consolidates with, or merges with or into, the Depositor, other than any
such transaction where the beneficial owners of the outstanding common stock of
the Depositor immediately prior to such transaction beneficially own a majority
of the outstanding shares of voting stock of the surviving person immediately
after such transaction, or (e) the first day on which more than a majority of
the members of the Board of Directors of the Depositor are not Continuing
Directors; provided, however, that a Change of Control shall not be deemed to
have occurred if the last reported sale price per share of the Common Stock for
any
-64-
ten Trading Days (as defined) within the period of twenty consecutive Trading
Days (x) ending immediately after the later of the Change of Control and the
public announcement of the Change in Control (in the case of a Change in Control
under clause (a), (b), (c) or (e) above) or (y) ending immediately before the
Change in Control (in the case of a Change in Control under clause (d) above)
shall equal or exceed 105% of the Conversion Price in effect on each such
Trading Day. If not earlier made, the Company shall make a public announcement
of a Change of Control within five Business Days of the occurrence of such
Change of Control.
(b) "Continuing Directors" means as of any date of determination, any
member of the board of directors of the Depositor who (a) was a member of the
board of directors on the date of original issuance of the Preferred Securities
or (b) was nominated for election to the board of directors with the approval
of, or whose election was ratified by, at least two-thirds of the Continuing
Directors who were members of the board of directors at the time of such
nomination or election.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1. LIMITATION OF RIGHTS OF HOLDERS.
The death, incapacity, liquidation, dissolution, termination or bankruptcy
of any Person having an interest, beneficial or otherwise, in Trust Securities
shall not operate to terminate this Trust Agreement, nor entitle the legal
representatives or heirs of such Person or any Holder for such Person, to claim
an accounting, take any action or bring any proceeding in any court for a
partition or winding up of the arrangements contemplated hereby, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any of
them.
SECTION 11.2. LIABILITY.
(a) Except as expressly set forth in this Trust Agreement, the Guarantee
and the terms of the Trust Securities, the Depositor 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; or
(ii) required to pay to any Holder any deficit upon dissolution of the
Trust or otherwise.
-65-
(b) The Holder of the Common Securities shall be liable for all of the
debts and obligations of the Trust (other than with respect to the Trust
Securities) to the extent not satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act, the Holders of
the Preferred Securities shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.
SECTION 11.3. AMENDMENT.
(a) This Trust Agreement may be amended from time to time by the Property
Trustee, the Administrative Trustees and the Depositor, without the consent of
any Holders, (i) to cure any ambiguity, correct or supplement any provision
herein which may be inconsistent with any other provision herein, or to make any
other provisions with respect to matters or questions arising under this Trust
Agreement, which shall not be inconsistent with the other provisions of this
Trust Agreement, or to add to the covenants of the Trust for the benefit of the
Holders or to surrender any right or power herein conferred upon the Trust, (ii)
to modify, eliminate or add to any provisions of this Trust Agreement to such
extent as shall be necessary to ensure that the Trust will be classified for
United States federal income tax purposes as a grantor trust at all times that
any Trust Securities are Outstanding or to ensure that the Trust will not be
required to register as an investment company under the 1940 Act or (iii) to
cause this Trust Agreement to be qualified under the Trust Indenture Act;
provided, however, that in the case of clause (i), (ii) or (iii), such action
shall not adversely affect in any material respect the interests of any Holder,
and any such amendments of this Trust Agreement shall become effective when
notice thereof is given to the Holders.
(b) Except as provided in Section 11.3(c) hereof, any provision of this
Trust Agreement may be amended by the Trustees and the Depositor with (i) the
consent of Holders representing not less than a majority (based upon Liquidation
Amounts) of the Trust Securities then Outstanding, 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 a grantor trust for United States federal
income tax purposes or the Trust's exemption from status of an investment
company under the 1940 Act.
(c) In addition to and notwithstanding any other provision in this Trust
Agreement, without the consent of each affected Holder (such consent being
obtained in accordance with Section 6.3 or 6.6 hereof), this Trust Agreement may
not be amended to (i) change the amount or timing of any Distribution on the
Trust Securities or otherwise adversely affect the amount of any Distribution
required to be made in respect of the Trust Secu-
-66-
rities as of a specified date, or (ii) restrict the right of a Holder to
institute suit for the enforcement of any such payment on or after such date;
notwithstanding any other provision herein, without the unanimous consent of the
Holders (such consent being obtained in accordance with Section 6.3 or 6.6
hereof), this Section 11.3(c) may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Trust to fail or cease to qualify for the exemption from
status of an investment company under the 1940 Act or fail or cease to be
classified as a grantor trust for United States federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor, this Trust Agreement may not be amended in
a manner which imposes any additional obligation on the Depositor.
(f) In the event that any amendment to this Trust Agreement is made, the
Administrative Trustees shall promptly provide to the Depositor a copy of such
amendment.
(g) Neither the Property Trustee nor the Delaware Trustee shall be required
to enter into any amendment to this Trust Agreement which affects its own
rights, duties or immunities under this Trust Agreement. The Property Trustee
shall be entitled to receive an Opinion of Counsel and an Officers' Certificate
stating that any amendment to this Trust Agreement is in compliance with this
Trust Agreement.
SECTION 11.4. SEPARABILITY.
In case any provision in this Trust Agreement or in the Trust Securities
Certificates shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 11.5. GOVERNING LAW.
THIS TRUST AGREEMENT AND TILE RIGHTS AND OBLIGATIONS OF EACH OF THE
HOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT AND THE
TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF DELAWARE (WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES).
SECTION 11.6. PAYMENTS DUE ON NON-BUSINESS DAY.
If the date fixed for any payment on any Trust Security shall be a day that
is not a Busi-
-67-
ness Day, then such payment shall be made on the next succeeding day that is a
Business Day (and without any interest or other payment in respect of any such
delay) (except as otherwise provided in Sections 4.1(a) and 4.2(d)), with the
same force and effect as though made on the date fixed for such payment.
SECTION 11.7. SUCCESSORS.
This Trust Agreement shall be binding upon and shall inure to the benefit
of any successor to the Depositor, the Trust or the Relevant Trustee, including
any successor by operation of law. Except in connection with a consolidation,
merger or sale involving the Depositor that is permitted under Article Eight of
the Indenture and pursuant to which the assignee agrees in writing to perform
the Depositor's obligations hereunder, the Depositor shall not assign its
obligations hereunder.
SECTION 11.8. HEADINGS.
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
SECTION 11.9. REPORTS, NOTICES AND DEMANDS.
(a) Any report, notice, demand or other communication which by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon any Holder or the Depositor may be given or served in writing by
deposit thereof, first-class postage prepaid, in the United States mail, hand
delivery or facsimile transmission, in each case, addressed: (i) in the case of
a Holder, to such Holder as such Holder's name and address may appear on the
Securities Register; and (ii) in the case of the Holder of Common Securities or
the Depositor, to Gentiva Health Services, Inc. 175 Broad Hollow Road, Melville,
New York 11747, Attention: Chief Financial Officer, facsimile no.: (631)
844-7335. Such notice, demand or other communication to or upon a Holder shall
be deemed to have been sufficiently given or made, for all purposes, upon hand
delivery, mailing or transmission. Such notice, demand or other communication to
or upon the Depositor shall be deemed to have been sufficiently given or made
only upon actual receipt of the writing by the Depositor.
(b) Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Trust, the Property Trustee or the Administrative Trustees shall be given in
writing addressed (until another address is published by the Trust) as follows:
(i) with respect to the Property Trustee to Wilmington Trust Company, 1100 N.
Market Street, Wilmington, Delaware 19801, Attention: Corporate Trust
Administration; and (ii) with respect to the Administrative Trustees, to them at
the address above for notices to the Depositor, marked "Attention Administrative
Trustees of Gentiva Trust." Such notice, demand or other communication to or
upon the Trust or the
-68-
Property Trustee shall be deemed to have been sufficiently given or made only
upon actual receipt of the writing by the Trust or the Property Trustee.
SECTION 11.10. AGREEMENT NOT TO PETITION.
Each of the Trustees and the Depositor agree for the benefit of the Holders
that, until at least one year and one day after the Trust has been terminated in
accordance with Article IX, they shall not file, or join in the filing of, a
petition against the Trust under any bankruptcy, insolvency, reorganization or
other similar law (including the United States Bankruptcy Code) (collectively,
"Bankruptcy Laws") or otherwise join in the commencement of any proceeding
against the Trust under any Bankruptcy Law. In the event the Depositor takes
action in violation of this Section 11.10, the Property Trustee agrees, for the
benefit of Holders, that at the expense of the Depositor, it shall file an
answer with the bankruptcy court or otherwise properly contest the filing of
such petition by the Depositor against the Trust or the commencement of such
action and raise the defense that the Depositor has agreed in writing not to
take such action and should be stopped and precluded therefrom and such other
defenses, if any, as counsel for the Property Trustee or the Trust may assert.
The provisions of this Section 11.10 shall survive the termination of this Trust
Agreement.
SECTION 11.11. TRUST INDENTURE ACT; CONFLICT WITH TRUST INDENTURE ACT.
(a) This Trust Agreement shall be subject to the provisions of the Trust
Indenture Act whether or not such provisions are required or deemed to be part
of this Trust Agreement and shall, to the extent applicable, be governed by such
provisions.
(b) The Property Trustee shall be the only Trustee which is a trustee for
the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with another
provision hereof which is or would be required or deemed to be included in this
Trust Agreement by any of the provisions of the Trust Indenture Act, such
required or deemed provision shall control. If any provision of this Trust
Agreement modifies or excludes any provision of the Trust Indenture Act which
may be so modified or excluded, the latter provision shall be deemed to apply to
this Trust Agreement as so modified or excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Trust Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
-69-
SECTION 11.12. ACCEPTANCE OF TERMS OF TRUST AGREEMENT, GUARANTEE AND
INDENTURE.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY
OR ON BEHALF OF A HOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY ALL HOLDERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST SECURITY OF ALL THE
TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND AGREEMENT TO THE SUBORDINATION
PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE INDENTURE, AND SHALL
CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH HOLDER AND SUCH OTHERS THAT THE
TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE BINDING, OPERATIVE AND
EFFECTIVE AS BETWEEN THE TRUST AND SUCH HOLDER AND SUCH OTHERS.
SECTION 11.13. HOLDERS ARE PARTIES.
Notwithstanding that Holders have not executed and delivered this Trust
Agreement or any counterpart thereof, Holders shall be deemed to be parties to
this Trust Agreement and shall be bound by all of the terms and conditions
hereof and of the Trust Securities by acceptance and delivery of the Trust
Securities.
SECTION 11.14. COUNTERPARTS.
This Trust Agreement may contain more than one counterpart of the signature
page and this Trust Agreement may be executed by the affixing of the signature
of each of the Trustees of one of such counterpart signature pages. All of such
counterpart signature pages shall be read as though one, and they shall have the
same force and effect as though all of the signers had signed a single signature
page.
GENTIVA HEALTH SERVICES, INC.
By:
--------------------------------
Name:
Title:
-70-
Wilmington Trust Company, as Property
Trustee and Delaware Trustee
By:
--------------------------------
Name:
Title:
Edward A. Blechshmidt, as
Administrative Trustee
By:
--------------------------------
John J. Collura, as Administrative Trustee
By:
--------------------------------
Patricia C. Ma, as Administrative Trustee
By:
--------------------------------
-71-
EXHIBIT A
CERTIFICATE OF TRUST OF GENTIVA TRUST
THIS Certificate of Trust of Gentiva Trust (the "Trust") is being duly
executed and filed on behalf of the Trust by the undersigned, as trustees, to
form a business trust under the Delaware Business Trust Act (12 Del. C.ss.3801
et seq.) (the "Act").
Name. The name of the business trust formed by this Certificate of Trust is
Gentiva Trust.
Delaware Trustee. The name and business address of the trustee of the Trust
in the State of Delaware are Wilmington Trust Company, 1100 North Market Street,
Wilmington, Delaware 19801, Attn: Corporate Trust Administration.
Effective Date. This Certificate of Trust shall be effective upon filing.
A-1
IN WITNESS WHEREOF, the undersigned have duly executed this Certificate of
Trust in accordance with Section 3811(a)(1) of the Act.
Edward A. Blechschmidt, not
in its individual capacity but solely as Trustee
By:
----------------------------------------------
Name:
Title:
Patricia C. Ma, not
in its individual capacity but solely as Trustee
By:
----------------------------------------------
Name:
Title:
John J. Collura, not
in its individual capacity but solely as Trustee
By:
----------------------------------------------
Name:
Title:
Wilmington Trust Company, not
in its individual capacity but solely as Trustee
By:
----------------------------------------------
Name:
Title:
A-2
EXHIBIT B
FORM OF COMMON SECURITY
THIS CERTIFICATE IS NOT TRANSFERABLE TO ANY PERSON, EXCEPT THAT THE HOLDER
AND ANY WHOLLY-OWNED SUBSIDIARY MAY TRANSFER THIS SECURITY TO GENTIVA HEALTH
SERVICES, INC. OR A WHOLLY-OWNED SUBSIDIARY OF GENTIVA HEALTH SERVICES, INC. OR
ANY ENTITY OWNING ALL OF THE OUTSTANDING COMMON STOCK OF GENTIVA HEALTH
SERVICES, INC., SUBJECT TO RECEIPT BY THE TRUST OF AN OPINION OF COUNSEL THAT
SUCH TRANSFER WOULD NOT CAUSE MORE THAN AN INSUBSTANTIAL RISK THAT (I) THE TRUST
WOULD NOT BE CLASSIFIED FOR UNITED STATES FEDERAL INCOME TAX PURPOSES AS A
GRANTOR TRUST; OR (II) THE TRUST WOULD BE AN INVESTMENT COMPANY REQUIRED TO
REGISTER UNDER THE INVESTMENT COMPANY ACT OR THE TRANSFEREE WOULD BECOME AN
INVESTMENT COMPANY REQUIRED TO REGISTER UNDER THE INVESTMENT COMPANY ACT.
CERTIFICATE NUMBER: NUMBER OF COMMON SECURITIES:
Certificate Evidencing Common Securities of
GENTIVA TRUST
(Liquidation Amount $50 per Common Security)
Gentiva Trust, a statutory business trust created under the laws of the
State of Delaware (the "Trust"), hereby certifies that Gentiva Health Services,
Inc. (the "Holder") is the registered owner of common securities of the Trust
representing beneficial ownership interests of the Trust and designated the
Common Securities (Liquidation Amount $50 per Common Security) (the "Common
Securities"). In accordance with Section 5.11 of the Trust Agreement (as defined
below) the Common Securities are not transferable except in limited
circumstances and any attempted transfer, except in such limited circumstances,
shall be void. The designations, rights, privileges, restrictions, preferences
and other terms and provisions of the Common Securities are set forth in, and
this certificate and the Common Securities represented hereby are issued and
shall in all respects be subject to the terms and provisions of, the Trust
Agreement of the Trust dated as of March 9, 2000, as the same may be amended
from time to time (the "Trust Agreement") including the designation of the terms
of the Common Securities as set forth therein. The Trust will furnish a copy of
the Trust Agree-
B-1
ment to the Holder without charge upon written request to the
Trust at its principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder and by acceptance hereof
agrees to the provisions of (i) the Guarantee Agreement entered into by Gentiva
Health Services, Inc., a Delaware corporation ("Gentiva"), and Wilmington Trust
Company, as guarantee trustee, dated as of March 15, 2000, and (ii) the
Indenture entered into by Gentiva and Wilmington Trust Company, as trustee,
dated as of March 15, 2000.
This Certificate shall be construed in accordance with and governed by the
laws of the State of Delaware (without regard to conflict of laws principles).
IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust has
executed this certificate on this day of .
GENTIVA TRUST
By:
--------------------------------------------
Name:
Title:
B-2
EXHIBIT C
FORM OF PREFERRED SECURITY
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR UNDER THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, RESOLD, 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, SUCH REGISTRATION.
THE HOLDER HEREOF MAY NOT ENGAGE IN HEDGING TRANSACTIONS IN THIS SECURITY
UNLESS SUCH TRANSACTIONS ARE IN COMPLIANCE WITH THE SECURITIES ACT. THE HOLDER
OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, RESELL OR OTHERWISE
TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION TERMINATION
DATE") WHICH IS THE LATER OF (X) TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE
DATE HEREOF AND THE LAST DATE ON WHICH GENTIVA HEALTH SERVICES, INC. (THE
"COMPANY") OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR
ANY PREDECESSOR OF SUCH SECURITY), AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE
REQUIRED BY APPLICABLE LAW ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE
144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS
AND SALES THAT OCCUR OUTSIDE THE UNITED STATES IN ACCORDANCE WITH REGULATION S
UNDER THE SECURITIES ACT, OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S
AND THE TRANSFER AGENT'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSES (D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND
WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE. ANY TRANSFER OF THIS SECURITY IS REQUIRED TO BE MADE IN
COMPLIANCE WITH
C-1
THE APPLICABLE STATE SECURITIES LAWS AND APPLICABLE SECURITIES LAWS OF OTHER
JURISDICTIONS.
EACH PURCHASER OR HOLDER OF THE SECURITY EVIDENCED HEREBY WILL BE DEEMED TO
HAVE REPRESENTED EITHER THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO PART
4 OF SUBTITLE B OF TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED, ("ERISA") OR A PLAN DESCRIBED IN SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE") OR AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE THE ASSETS OF ANY SUCH ERISA PLAN OR OTHER PLAN.
In the case of a purchaser of Preferred Securities in the State of Georgia,
for a period of one year from the Closing Date, the Preferred Securities shall
contain the following additional legend:
THESE SECURITIES HAVE BEEN ISSUED OR SOLD IN RELIANCE ON PARAGRAPH
(13) OF CODE SECTION 10-5-9 OF THE `GEORGIA SECURITIES ACT OF 1973', AND
MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN A TRANSACTION WHICH IS EXEMPT
UNDER SUCH ACT OR PURSUANT TO AN EFFECTIVE REGISTRATION UNDER SUCH ACT.
THE HOLDER OF THIS SECURITY AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT
OF THIS LEGEND.
C-2
CERTIFICATE NUMBER:
NUMBER OF PREFERRED SECURITIES:
Certificate Evidencing Preferred Securities
of
GENTIVA TRUST
10% Shared Preference Redeemable Preferred Securities,
(Liquidation Amount $50 per Preferred Security)
Gentiva Trust, a statutory business trust created under the laws of the
State of Delaware (the "Trust"), hereby certifies that (the "Holder") is the
registered owner of preferred securities of the Trust representing an undivided
beneficial ownership interest in the assets of the Trust and designated the
Gentiva Trust Shared Preference Redeemable Securities (SPuRSSM) (Liquidation
Amount $50 per Preferred Security) (the "Preferred Securities"). The Preferred
Securities are transferable on the books and records of the Trust, in person by
a duly authorized attorney, upon surrender of this certificate duly endorsed and
in proper form for transfer as provided in Section 5.4 of the Trust Agreement
(as defined below). The designations, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities are set
forth in, and this certificate and the Preferred Securities represented hereby
are issued and shall in all respects be subject to, the terms and provisions of,
the Trust Agreement of the Trust dated as of March 9, 2000, as the same may be
amended from time to time (the "Trust Agreement") including the designation of
the terms of Preferred Securities as set forth herein. The Holder is entitled to
the benefits of the Guarantee Agreement entered into by Gentiva Health Services,
Inc., a Delaware corporation ("Gentiva"), and Wilmington Trust Company
("Preferred Guaranty Trustee"), as guarantee trustee, dated as of March 15, 2000
(the "Guarantee"). The Trust will furnish a copy of the Trust Agreement and the
Guarantee to the Holder without charge upon written request to the Trust at its
principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder and by acceptance hereof
agrees to the provisions of (i) the Guarantee, and (ii) the Indenture entered
into by Gentiva and Wilmington Trust Company, as trustee, dated as of March 15,
2000.
This Certificate shall be construed in accordance with and governed by the
laws of the State of Delaware (without regard to conflict of laws principles).
C-3
IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust has
executed this certificate.
Dated:
GENTIVA TRUST
By:
---------------------------------------
Name:
Title:
C-4
This is one of the Securities referred to in the within mentioned Trust
Agreement.
Date of Authentication:
Wilmington Trust Company,
as Property Trustee
By:
--------------------------------------------
Name:
Title:
C-5
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Trust
Security to:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
agent to transfer this Preferred Securities 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 Trust 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)
C-6
CONVERSION REQUEST
To: Wilmington Trust Company, as Conversion Agent under the Trust Agreement of
Gentiva Trust
The undersigned owner of these Preferred Securities hereby irrevocably
exercises the option to convert these Preferred Securities, or the portion below
designated, into common stock of GENTIVA HEALTH SERVICES, INC., par value $.10
per share (the "Common Stock"), in accordance with the terms of the Trust
Agreement. Pursuant to the aforementioned exercise of the option to convert
these Preferred Securities, the undersigned hereby directs the Conversion Agent
(as that term is defined in the Trust Agreement) to (i) exchange such Preferred
Securities for a portion of the Debentures (as that term is defined in the Trust
Agreement) held by the Trust at the Conversion Price specified in the Trust
Agreement, and (ii) immediately convert such Debentures on behalf of the
undersigned, into Common Stock at the Conversion Price specified in the Trust
Agreement. The number of shares issuable upon conversion of Preferred Securities
shall be determined by (i) multiplying the number of Preferred Securities to be
converted by $50 and (ii) dividing such amount by the Conversion Price in effect
on the Conversion Date.
The undersigned also hereby directs the Conversion Agent that the shares
issuable and deliverable upon conversion, together with any check in payment for
fractional shares, be issued in the name of and delivered to the undersigned,
unless a different name has been indicated in the assignment below. If shares
are to be issued in the name of a person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect thereto.
If the undersigned is a BHCA Person (as that term is defined in the Trust
Agreement, the undersigned certifies that it is in compliance with Section
4.3(a) of the Trust Agreement.
Date: ___________________
Number of Preferred Securities to be converted: _____________
C-7
If a name or names other than the undersigned, please indicate in the spaces
below the name or names in which the shares of Common Stock are to be issued,
along with the address or addresses of such person or persons.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Sign exactly as your name appears on the other side of this Trust Security
certificate) (for conversion of definitive Preferred Securities only)
Please Print or Typewrite Name and Address, Including Zip Code, and Social
Security or Other Identifying Number.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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)
C-8
CERTIFICATE FOR EXCHANGE OR TRANSFER
Re: 10% Shared Preference Redeemable Securities ("SPuRS" or "Preferred
Securities)
This Certificate relates to _________ Preferred Securities held by
_________ (the "Transferor").
The Transferor has requested the Trustee by written order to exchange or
register the transfer of a Preferred Security or Preferred Securities.
In connection with such request and in respect of each such security, the
Transferor does hereby certify to the Depositor and the Trustee that Transferor
is familiar with the Trust Agreement relating to the above captioned Preferred
Securities and, as provided in Section 5.4 and Section 5.5 of such Trust
Agreement, the transfer of this Preferred Security does not require registration
under the Securities Act (as defined below) because:
[ ] Such Preferred Security is being acquired for the Transferor's own
account, without transfer.
[ ] Such Preferred Security is being transferred pursuant to an effective
registration statement under the Securities Act.
[ ] Such Preferred Security is being transferred to a "qualified
institutional buyer" (as defined in Rule 144A under the Securities Act of 1933,
as amended (the "Securities Act")) in reliance on Rule 144A.
[ ] Such Preferred Security is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the
Securities Act pursuant to Regulation S, Rule 144 or otherwise (other than
pursuant to Rule 144A) under the Securities Act. An opinion of counsel to the
effect that such transfer does not require registration under the Securities Act
accompanies this Certificate.
If this certificate is being delivered in connection with a transfer or
exchange of Preferred Securities held by a BHCA Person (as that term is defined
in the Trust Agreement), such BHCA Person certifies that this transfer or
exchange complies with Section 4.3(a) of the Trust Agreement.
C-9
You are entitled to rely upon this certificate and you are irrevocably
authorized to produce this certificate or a copy hereof to any interested party
in any administrative or legal proceeding or official inquiry with respect to
the matters covered hereby.
____________________________________
[INSERT NAME OF TRANSFEROR]
By:_________________________________
Date:
C-10
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have Preferred Securities represented by this certificate
purchased by the Depositor pursuant to Article X of the Trust Agreement, check
the Box: [ ]
If you wish to have a portion of the Preferred Securities represented by
this certificate purchased by the Depositor pursuant to Article X of the Trust
Agreement, state the number of Preferred Securities you wish to have purchased:
_____________
Date: ___________________
Your Signature(s):
(Sign exactly as your name appears on the face of this Security)
Tax Identification No.: _____________________
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)
C-11
EXHIBIT D
FORM OF CERTIFICATE TO BE DELIVERED
UPON EXCHANGE OR REGISTRATION OF TRANSFER
OF PREFERRED SECURITIES
CERTIFICATE FOR EXCHANGE OR TRANSFER
Re: 10.0% Shared Preference Redeemable Securities ("SpuRS" or "Preferred
Securities)
This Certificate relates to _________ Preferred Securities held by
_________ (the "Transferor").
The Transferor has requested the Trustee by written order to exchange or
register the transfer of a Preferred Security or Preferred Securities.
In connection with such request and in respect of each such security, the
Transferor does hereby certify to the Depositor and the Trustee that Transferor
is familiar with the Trust Agreement relating to the above captioned Preferred
Securities and, as provided in Section 5.4 and Section 5.5 of such Trust
Agreement, the transfer of this Preferred Security does not require registration
under the Securities Act (as defined below) because:
/ / Such Preferred Security is being acquired for the Transferor's own
account, without transfer.
/ / Such Preferred Security is being transferred pursuant to an
effective registration statement under the Securities Act.
/ / Such Preferred Security is being transferred to a "qualified
institutional buyer" (as defined in Rule 144A under the Securities Act of
1933, as amended (the "Securities Act")) in reliance on Rule 144A.
/ / Such Preferred Security is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the
Securities Act pursuant to Regulation S, Rule 144 or otherwise (other than
pursuant to Rule 144A) under the Securities Act. An opinion of counsel to the
effect that such transfer does not require registration under the Securities Act
accompanies this Certificate.
If this certificate is being delivered in connection with a transfer or
exchange of Preferred Securities held by a BHCA Person (as that term is defined
in the Trust Agree-
D-1
ment), such BHCA Person certifies that this transfer or exchange complies with
Section 4.3(a) of the Trust Agreement.
You are entitled to rely upon this certificate and you are irrevocably
authorized to produce this certificate or a copy hereof to any interested party
in any administrative or legal proceeding or official inquiry with respect to
the matters covered hereby.
- --------------------------------------------------------------------------------
[INSERT NAME OF TRANSFEROR]
By:
Date: __________________________
D-2
EXHIBIT E
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have Preferred Securities represented by this certificate
purchased by the Depositor pursuant to Article X of the Trust Agreement, check
the Box: / /
If you wish to have a portion of the Preferred Securities represented by
this certificate purchased by the Depositor pursuant to Article X of the Trust
Agreement, state the number of Preferred Securities you wish to have purchased:
- --------------------
Date: ___________________ Your Signature(s):_________________________
Tax Identification No.:
(Sign exactly as your name appears on the face of this Security)
Signature Guarantee:_______________________________________________
E-1