EXHIBIT 4.5
AMENDED AND RESTATED DECLARATION
OF TRUST
OF
RELIANCE CAPITAL TRUST I
Dated as of April 28, 1998
TABLE OF CONTENTS
Page
----
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions...................................................................................2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.............................................................10
SECTION 2.2 Lists of Holders of Securities...............................................................10
SECTION 2.3 Reports by the Property Trustee..............................................................11
SECTION 2.4 Periodic Reports to Property Trustee.........................................................11
SECTION 2.5 Evidence of Compliance with Conditions Precedent.............................................11
SECTION 2.6 Events of Default; Waiver....................................................................11
SECTION 2.7 Default; Notice..............................................................................13
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.........................................................................................14
SECTION 3.2 Office.......................................................................................14
SECTION 3.3 Purpose......................................................................................14
SECTION 3.4 Authority....................................................................................14
SECTION 3.5 Title to Property of the Trust...............................................................14
SECTION 3.6 Powers and Duties of the Administrative Trustees.............................................15
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.........................................18
SECTION 3.8 Powers and Duties of the Property Trustee....................................................19
SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee..................................21
SECTION 3.10 Certain Rights of Property Trustee...........................................................23
SECTION 3.11 Delaware Trustee.............................................................................25
SECTION 3.12 Execution of Documents.......................................................................25
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.......................................25
SECTION 3.14 Duration of Trust............................................................................25
SECTION 3.15 Mergers......................................................................................26
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities......................................................28
SECTION 4.2 Responsibilities of the Sponsor..............................................................28
SECTION 4.3 Right to Proceed.............................................................................28
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SECTION 4.4 Right to Dissolve Trust......................................................................29
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees; Appointment of Co-Trustee................................................29
SECTION 5.2 Delaware Trustee.............................................................................30
SECTION 5.3 Property Trustee; Eligibility................................................................30
SECTION 5.4 Certain Qualifications of Administrative Trustees and Delaware
Trustee Generally............................................................................31
SECTION 5.5 Administrative Trustees......................................................................31
SECTION 5.6 Appointment, Removal and Resignation of Trustees.............................................32
SECTION 5.7 Vacancies among Trustees.....................................................................34
SECTION 5.8 Effect of Vacancies..........................................................................34
SECTION 5.9 Meetings.....................................................................................34
SECTION 5.10 Delegation of Power..........................................................................34
SECTION 5.11 Merger, Conversion, Consolidation or Succession to Business..................................35
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions................................................................................35
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities......................................................35
SECTION 7.2 Execution and Authentication.................................................................36
SECTION 7.3 Form and Dating..............................................................................37
SECTION 7.4 Registrar, Paying Agent and Exchange Agent...................................................38
SECTION 7.5 Paving Agent to Hold Money in Trust..........................................................39
SECTION 7.6 Replacement Securities.......................................................................39
SECTION 7.7 Outstanding Capital Securities...............................................................39
SECTION 7.8 Capital Securities in Treasury...............................................................40
SECTION 7.9 Temporary Securities.........................................................................40
SECTION 7.10 Cancellation.................................................................................41
SECTION 7.11 CUSIP Numbers................................................................................41
ARTICLE VIII
DISSOLUTION OF TRUST
SECTION 8.1 Dissolution of Trust.........................................................................41
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ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.......................................................................42
SECTION 9.2 Transfer Procedures and Restrictions.........................................................43
SECTION 9.3 Deemed Security Holders......................................................................53
SECTION 9.4 Book-Entry Interests.........................................................................53
SECTION 9.5 Notices to Clearing Agency...................................................................54
SECTION 9.6 Appointment of Successor Clearing Agency.....................................................54
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability....................................................................................54
SECTION 10.2 Exculpation..................................................................................54
SECTION 10.3 Fiduciary Duty...............................................................................55
SECTION 10.4 Indemnification..............................................................................56
SECTION 10.5 Outside Businesses...........................................................................59
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year..................................................................................59
SECTION 11.2 Certain Accounting Matters...................................................................59
SECTION 11.3 Banking......................................................................................60
SECTION 11.4 Withholding..................................................................................60
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments...................................................................................60
SECTION 12.2 Meetings of the Holders; Action by Written Consent...........................................62
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee...........................................64
SECTION 13.2 Representations and Warranties of Delaware Trustee...........................................64
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ARTICLE XIV
REGISTRATION RIGHTS
SECTION 14.1 Registration Rights Agreement; Liquidated Damages............................................65
ARTICLE XV
MISCELLANEOUS
SECTION 15.1 Notices......................................................................................66
SECTION 15.2 Governing Law................................................................................67
SECTION 15.3 Intention of the Parties.....................................................................67
SECTION 15.4 Headings.....................................................................................67
SECTION 15.5 Successors and Assigns.......................................................................67
SECTION 15.6 Partial Enforceability.......................................................................68
SECTION 15.7 Counterparts.................................................................................68
ANNEX I
TERMS OF CAPITAL AND COMMON SECURITIES.................................................................I-1
EXHIBIT A-1
FORM OF CAPITAL SECURITY CERTIFICATE..................................................................A1-1
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE...................................................................A2-1
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CROSS-REFERENCE TABLE*
Section of
Trust Indenture
Act of 1939, as Section of
amended Declaration
- ---------------- -------------
310(a) ...................................................................... 5.3
310(b) ...................................................................... 5.3(c), 5.3(d)
311(a) ...................................................................... 2.2(b)
311(b) ...................................................................... 2.2(b)
312(a) ...................................................................... 2.2(a)
312(b) ...................................................................... 2.2(b)
313 ...................................................................... 2.3
314(a) ...................................................................... 2.4; 3.6(j)
314(c) ...................................................................... 2.5
315(a) ...................................................................... 3.9
315(b) ...................................................................... 2.7(a)
315(c) ...................................................................... 3.9(a)
315(d) ...................................................................... 3.9(b)
316(a) ...................................................................... 2.6
316(c) ...................................................................... 3.6(e)
317(a) ...................................................................... 3.8(e); 3.8(h)
317(b) ...................................................................... 3.8(i); 7.5
* This Cross-Reference Table does not constitute part of this Declaration
and shall not affect the interpretation of any of its terms or
provisions.
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AMENDED AND RESTATED
DECLARATION OF TRUST
OF
RELIANCE CAPITAL TRUST I
Dated as of April 28, 1998
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated and effective as of April 28, 1998, by the Trustees (as defined herein),
the Sponsor (as defined herein) and by the holders, from time to time, of
undivided beneficial interests in the assets of the Trust to be issued pursuant
to this Declaration;
WHEREAS, certain of the Trustees and the Sponsor established
Reliance Capital Trust I (the "Trust"), a trust created under the Delaware
Business Trust Act pursuant to a Declaration of Trust dated as of April 20, 1998
(the "Original Declaration"), and a Certificate of Trust filed with the
Secretary of State of the State of Delaware on April 20, 1998, for the sole
purpose of issuing and selling certain securities representing undivided
beneficial interests in the assets of the Trust, investing the proceeds thereof
in certain Debentures of the Debenture Issuer (each as hereinafter defined), and
engaging in only those activities necessary, advisable or incidental thereto;
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the Original
Declaration; and
NOW, THEREFORE, it being the intention of the parties hereto
to continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration and, in consideration
of the mutual covenants contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties,
intending to be legally bound hereby, agree as follows:
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ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 DEFINITIONS.
Unless the context otherwise requires:
(a) capitalized terms used in this Declaration but not
defined in the preamble above or elsewhere herein have the respective meanings
assigned to them in this Section 1.1;
(b) a term defined anywhere in this Declaration has the
same meaning throughout;
(c) all references to "the Declaration" or "this
Declaration" are to this Declaration and each Annex and Exhibit hereto, as
modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and
Sections and Annexes and Exhibits are to Articles and Sections of and Annexes
and Exhibits to this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Declaration unless otherwise defined in this
Declaration or unless the context otherwise requires;
(f) a term defined in the Indenture (as defined herein)
has the same meaning when used in this Declaration unless otherwise defined in
this Declaration or the context otherwise requires; and
(g) a reference to the singular includes the plural and
vice versa.
"Administrative Trustee" has the meaning set forth in
Section 5.1.
"Affiliate" has the same meaning as given to that term in
Rule 405 under the Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent, Registrar or Exchange
Agent.
"Authorized Officer" of a Person means any other Person
that is authorized to legally bind such former Person.
"Book-Entry Interest" means a beneficial interest in the
Global Capital Security registered in the name of a Clearing Agency or its
nominee, ownership and transfers of which shall be maintained and made through
book entries by a Clearing Agency as described in Section 9.4.
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"Business Day" means any day other than a Saturday or a
Sunday or a day on which banking institutions in New York, New York are
authorized or required by law or executive order to remain closed.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss. 3801 et seq., as it may be amended from time to
time, or any successor legislation.
"Capital Security Beneficial Owner" means, with respect to
a Book-Entry Interest, a Person who is the beneficial owner of such Book-Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of a
Person maintaining an account with such Clearing Agency (directly as a Clearing
Agency Participant or as an indirect participant, in each case in accordance
with the rules of such Clearing Agency).
"Capital Security Certificate" has the meaning set forth
in Section 9.4.
"Capital Securities" means, collectively, the Series A
Capital Securities and the Series B Capital Securities.
"Capital Securities Guarantee" means, collectively, the
Series A Capital Securities Guarantee and the Series B Capital Securities
Guarantee.
"Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Capital Securities and in whose name or in the name of a
nominee of that organization shall be registered a global certificate and which
shall undertake to effect book entry transfers and pledges of the Capital
Securities.
"Clearing Agency Participant" means a broker, dealer,
bank, other financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities deposited
with the Clearing Agency.
"Closing Time" means the "Closing Time" as defined in the
Purchase Agreement.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation.
"Commission" means the United States Securities and
Exchange Commission as from time to time constituted, or if at any time after
the execution of this Declaration such Commission is not existing and performing
the duties now assigned to it under applicable federal securities laws, then the
body performing such duties at such time.
"Common Securities" has the meaning specified in Section
7.1(a).
"Common Securities Guarantee" means the Common Securities
Guarantee Agreement, dated as of the Closing Time, of Reliance Bancorp, Inc., in
respect of the Common Securities.
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"Common Securities Subscription Agreement" means the
Common Securities Subscription Agreement, dated as of the Closing Time, between
the Trust and Reliance Bancorp, Inc., relating to the Common Securities.
"Company Indemnified Person" means (a) any Administrative
Trustee; (b) any Affiliate of any Administrative Trustee; (c) any officers,
directors, shareholders, members, partners, employees, representatives or agents
of any Administrative Trustee; or (d) any officer, employee or agent of the
Trust or its Affiliates.
"Corporate Trust Office" means the office of the Property
Trustee at which the corporate trust business of the Property Trustee shall, at
any particular time, be principally administered, which office at the date of
execution of this Declaration is located at 101 Barclay Street - 21 West, New
York, New York 10286.
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or agent of (i) the Trust
or (ii) the Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means Reliance Bancorp, Inc., a
Delaware corporation, or any successor entity resulting from any consolidation,
amalgamation, merger or other business combination, in its capacity as issuer of
the Debentures under the Indenture.
"Debenture Subscription Agreement" means the Debenture
Subscription Agreement, dated as of the Closing Time, between the Debenture
Issuer and the Trust in respect of the Series Debentures.
"Debenture Trustee" means The Bank of New York, a New York
banking corporation, as trustee under the Indenture until a successor is
appointed thereunder, and thereafter means such successor trustee.
"Debentures" means, collectively, the Series A Debentures
and the Series B Debentures.
"Default" means an event, act or condition that with
notice or lapse of time, or both, would constitute an Event of Default.
"Definitive Capital Securities" has the meaning set forth
in Section 7.3(c).
"Delaware Trustee" has the meaning set forth in Section
5.1.
"Direct Action" has the meaning set forth in Section
3.8(e).
"Distribution" means a distribution payable to Holders in
accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial
Clearing Agency.
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"Event of Default" in respect of the Securities means an
Event of Default (as defined in the Indenture) that has occurred and is
continuing in respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934,
as amended from time to time, or any successor legislation.
"Exchange Agent" has the meaning set forth in Section 7.4.
"Exchange Offer" means the offer that may be made pursuant
to the Registration Rights Agreement (i) by the Trust to exchange Series B
Capital Securities for Series A Capital Securities and (ii) by the Debenture
Issuer to exchange Series B Debentures for Series A Debentures and to execute
the Series B Capital Securities Guarantee in respect of the Series B Capital
Securities.
"Federal Reserve Board" means the Board of Governors of
the Federal Reserve System.
"Fiduciary Indemnified Person" has the meaning set forth
in Section 10.4(b).
"Fiscal Year" has the meaning set forth in Section 11.1.
"Global Capital Security" has the meaning set forth in
Section 7.3(a).
"Holder" means a Person in whose name a Security or
Successor Security is registered, such Person being a beneficial owner within
the meaning of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or
a Fiduciary Indemnified Person.
"Indenture" means the Indenture, dated as of the Closing
Time, between the Debenture Issuer and the Debenture Trustee, as amended from
time to time.
"Initial Optional Redemption Date" has the meaning set
forth in Section 4(b) of Annex I hereto.
"Investment Company" means an investment company as
defined in the Investment Company Act.
"Investment Company Act" means the Investment Company Act
of 1940, as amended from time to time, or any successor legislation.
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"Legal Action" has the meaning set-forth in Section
3.6(g).
"Like Amount" has the meaning set forth in Section 3 of
Annex I hereto.
"Liquidated Damages Agreement" means the Liquidated
Damages Agreement, dated as of April 23, 1998, by and among the Debenture
Issuer, the Trust and the Initial Purchaser named therein, as amended from time
to time.
"List of Holders" has the meaning set forth in Section
2.2(a).
"Majority in Liquidation Amount " means, with respect to
the Trust Securities, except as provided in the terms of the Capital Securities
or by the Trust Indenture Act, Holders of outstanding Trust Securities voting
together as a single class or, as the context may require, Holders of
outstanding Capital Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of more than 50% of the
aggregate liquidation amount (including the amount that would be paid on
redemption, liquidation or otherwise, plus accumulated and unpaid Distributions
to the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Offering Memorandum" has the meaning set forth in Section
3.6(b)(i).
"Officers' Certificate" means, with respect to any Person,
a certificate signed by the Chairman, the Chief Executive Officer, the
President, an Executive or Senior Vice President, a Vice President, the Chief
Financial Officer, the Secretary or an Assistant Secretary. Any Officers'
Certificate delivered by the Trust shall be signed by at least one
Administrative Trustee. Any Officers' Certificate delivered with respect to
compliance with a condition or covenant provided for in this Declaration shall
include:
(a) a statement that each officer signing the Certificate
has read the 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 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.
"Opinion of Counsel" means a written opinion of counsel,
who may be an employee of the Sponsor, and who shall be acceptable to the
Property Trustee.
"Participants" has the meaning specified in Section
7.3(b).
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"Paying Agent" has the meaning specified in Section 7.4.
"Payment Amount" has the meaning specified in Section 6.1.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"PORTAL" has the meaning set forth in Section 3.6(b)
(iii).
"Property Trustee" has the meaning set forth in Section
5.3(a).
"Property Trustee Account" has the meaning set forth in
Section 3.8(c)(i).
"Purchase Agreement" means the Purchase Agreement, dated
April 23, 1998, by and among the Trust, the Debenture Issuer and the Initial
Purchaser named therein.
"QIBs" shall mean qualified institutional buyers as
defined in Rule 144A.
"Quorum" means a majority of the Administrative Trustees
or, if there are only two Administrative Trustees, both of them.
"Registrar" has the meaning set forth in Section 7.4.
"Registration Rights Agreement" means the Registration
Rights Agreement, dated as of April 23, 1998, by and among the Trust, the
Debenture Issuer and the Initial Purchasers named therein, as amended from time
to time.
"Registration Statement" has the meaning set forth in the
Registration Rights Agreement.
"Regulator Capital Event" has the meaning set forth in
Section 4(c) of Annex I hereto.
"Related Party" means, with respect to the Sponsor, any
direct or indirect wholly owned subsidiary of the Sponsor or any other Person
that owns, directly or indirectly, 100% of the outstanding voting securities of
the Sponsor.
"Responsible Officer" means any officer within the
Corporate Trust Office of the Property Trustee with direct responsibility for
the administration of this Declaration and also means, with respect to a
particular corporate trust matter, any other officer of the Property Trustee to
whom such matter is referred because of that officer's knowledge of and
familiarity with the particular subject.
"Restricted Definitive Capital Securities" has the meaning
set forth in Section 7.3(c).
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"Restricted Capital Security" means a Capital Security
required by Section 9.2 to contain a Restricted Securities Legend.
"Restricted Securities Legend" has the meaning set forth
in Section 9.2(i).
"Rule 3a-5" means Rule 3a-5 under the Investment Company
Act, or any successor rule or regulation.
"Rule 144" means Rule 144 under the Securities Act, as
such rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
"Rule 144A" means Rule 144A under the Securities Act, as
such rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
"Securities" or "Trust Securities" means the Common
Securities and the Capital Securities.
"Securities Act" means the Securities Act of 1933, as
amended from time to time, or any successor legislation.
"Securities Guarantees" means the Common Securities
Guarantee and the Capital Securities Guarantee.
"Series A Capital Securities" has the meaning specified in
Section 7.1(a).
"Series A Capital Securities Guarantee" means the Series A
Capital Securities Guarantee Agreement, dated as of the Closing Time, by
Reliance Bancorp, Inc., in respect of the Series A Capital Securities.
"Series A Debentures" means the 8.17% Junior Subordinated
Deferrable Interest Debentures due May 1, 2028, Series A, of the Debenture
Issuer issued pursuant to the Indenture.
"Series B Capital Securities" has the meaning specified in
Section 7.1(a).
"Series B Capital Securities Guarantee" means the Series B
Capital Securities Guarantee Agreement to be entered into in connection with the
Exchange Offer by Reliance Bancorp, Inc., in respect of the Series B Capital
Securities.
"Series B Debentures" means the 8.17% Junior Subordinated
Deferrable Interest Debentures due May 1, 2028, Series B, of the Debenture
Issuer to be issued pursuant to the Indenture in connection with the Exchange
Offer.
"Special Event" has the meaning set forth in Section 4(c)
of Annex I hereto.
"Special Event Redemption Price" has the meaning set forth
in Section 4(c) of Annex I hereto.
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"Sponsor" means Reliance Bancorp, Inc., a Delaware
corporation, or any successor entity resulting from any merger, consolidation,
amalgamation or other business combination, in its capacity as sponsor of the
Trust.
"Successor Delaware Trustee" has the meaning set forth in
Section 5.6(b)(ii).
"Successor Entity" has the meaning set forth in Section
3.15(b)(i).
"Successor Property Trustee" has the meaning set forth in
Section 3.8(f)(ii).
"Successor Securities" has the meaning set forth in
Section 3.15(b)(i).
"Super Majority" has the meaning set forth in Section
2.6(a) (ii).
"Tax Event" has the meaning set forth in Section 4(c) of
Annex I hereto.
"10% in liquidation amount" means, with respect to the
Trust Securities, except as provided in the terms of the Capital Securities or
by the Trust Indenture Act, Holders of outstanding Trust Securities voting
together as a single class or, as the context may require, Holders of
outstanding Capital Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of 10% or more of the
aggregate liquidation amount (including the amount that would be paid on
redemption, liquidation or otherwise, plus accumulated and unpaid Distributions
to the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Treasury Regulations" means the income tax regulations,
including temporary and proposed regulations, promulgated under the Code by the
United States Treasury, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
"Trust Indenture Act" means the Trust Indenture Act of
1939, as amended from time to time, or any successor legislation.
"Trustee" or "Trustees" means each Person who has signed
this Declaration as a trustee, so long as such Person shall continue as a
trustee of the Trust in accordance with the terms hereof, and all other Persons
who may from time to time be duly appointed, qualified and serving as Trustees
in accordance with the provisions hereof, and references herein to a Trustee or
the Trustees shall refer to such Person or Persons solely in their capacity as
trustees hereunder.
"Trust Property" means (a) the Debentures, (b) any cash on
deposit in, or owing to the Property Trustee Account and (c) all proceeds and
rights in respect of the foregoing and any other property and assets for the
time being held or deemed to be held by the Property Trustee pursuant to this
Declaration.
"Unrestricted Global Capital Security" has the meaning set
forth in Section 9.2(b).
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ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 TRUST INDENTURE ACT; APPLICATION.
(a) This Declaration is subject to the provisions of the
Trust Indenture Act that are required to be part of this Declaration in order
for this Declaration to be qualified under the Trust Indenture Act and shall, to
the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which
is a trustee for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this
Declaration limits, qualifies or conflicts with the duties imposed by ss.ss. 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
(d) The application of the Trust Indenture Act to this
Declaration shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 2.2 LISTS OF HOLDERS OF SECURITIES.
(a) Each of the Sponsor and the Administrative Trustees on
behalf of the Trust shall provide the Property Trustee, unless the Property
Trustee is Registrar for the Securities, (i) within 14 days after each record
date for payment of Distributions, a list, in such form as the Property Trustee
may reasonably require, of the names and addresses of the Holders ("List of
Holders") as of such record date, provided that, neither the Sponsor nor the
Administrative Trustees on behalf of the Trust shall be obligated to provide
such List of Holders at any time that the List of Holders does not differ from
the most recent List of Holders given to the Property Trustee by the Sponsor and
the Administrative Trustees on behalf of the Trust, and (ii) at any other time,
within 30 days of receipt by the Trust of a written request for a List of
Holders as of a date no more than 14 days before such List of Holders is given
to the Property Trustee. The Property Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in Lists of Holders
given to it or which it receives in the capacity as Paying Agent (if acting in
such capacity), PROVIDED THAT the Property Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations
under ss.ss. 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 REPORTS BY THE PROPERTY TRUSTEE.
Within 60 days after May 1 of each year, commencing May 1,
1999, the Property Trustee shall provide to the Holders of the Capital
Securities such reports as are required by ss. 313 of the Trust Indenture Act,
if any, in the form and in the manner provided by ss. 313 of the Trust Indenture
Act. The Property Trustee shall also comply with the requirements of ss. 313(d)
of the Trust Indenture Act.
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SECTION 2.4 PERIODIC REPORTS TO PROPERTY TRUSTEE.
Each of the Sponsor and the Administrative Trustees on
behalf of the Trust shall provide to the Property Trustee such documents,
reports and information as are required by ss. 314 (if any) of the Trust
Indenture Act and the compliance certificate required by ss. 314 of the Trust
Indenture Act in the form, in the manner and at the times required by ss. 314 of
the Trust Indenture Act.
SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
Each of the Sponsor and the Administrative Trustees on
behalf of the Trust shall provide to the Property Trustee such evidence of
compliance with any conditions precedent provided for in this Declaration that
relate to any of the matters set forth in ss. 314(c) of the Trust Indenture Act.
Any certificate or opinion required to be given by an officer pursuant to ss.
314(c)(1) of the Trust Indenture Act may be given in the form of an Officers'
Certificate.
SECTION 2.6 EVENTS OF DEFAULT; WAIVER.
(a) The Holders of a Majority in Liquidation Amount of
Capital Securities may, by vote, on behalf of the Holders of all of the Capital
Securities, waive any past Event of Default in respect of the Capital Securities
and its consequences, PROVIDED THAT, if the underlying Event of Default under
the Indenture:
(i) is not waivable under the Indenture, the Event
of Default under the Declaration shall also not be
waivable; or
(ii) requires the consent or vote of greater than a
majority in aggregate principal amount of the holders of
the Debentures (a "Super Majority") to be waived under the
Indenture, the Event of Default under the Declaration may
only be waived by the vote of the Holders of at least the
proportion in aggregate liquidation amount of the Capital
Securities that the relevant Super Majority represents of
the aggregate principal amount of the Debentures
outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of ss.
316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust
Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
Default shall cease to exist, and any Event of Default with respect to the
Capital Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other Default or an Event of Default with respect to the Capital
Securities or impair any right consequent thereon. Any waiver by the Holders of
the Capital Securities of an Event of Default with respect to the Capital
Securities shall also be deemed to constitute a waiver by the Holders of the
Common Securities of any such Event of Default with respect to the Common
Securities for all purposes of this Declaration without any further act, vote,
or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in Liquidation Amount of the
Common Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of
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Default with respect to the Common Securities and its consequences, provided
that, if the underlying Event of Default under the Indenture:
(i) is not waivable under the Indenture, except
where the Holders of the Common Securities are deemed to
have waived such Event of Default under the Declaration as
provided below in this Section 2.6(b), the Event of
Default under the Declaration shall also not be waivable;
or
(ii) requires the consent or vote of a Super
Majority to be waived, except where the Holders of the
Common Securities are deemed to have waived such Event of
Default under the Declaration as provided below in this
Section 2.6(b), the Event of Default under the Declaration
may only be waived by the vote of the Holders of at least
the proportion in aggregate liquidation amount of the
Common Securities that the relevant Super Majority
represents of the aggregate principal amount of the
Debentures outstanding;
PROVIDED FURTHER, each Holder of Common Securities will be deemed to have waived
any such Event of Default and all Events of Default with respect to the Common
Securities and their consequences if all Events of Default with respect to the
Capital Securities have been cured, waived or otherwise eliminated, and until
such Events of Default have been so cured, waived or otherwise eliminated, the
Property Trustee will be deemed to be acting solely on behalf of the Holders of
the Capital Securities and only the Holders of the Capital Securities will have
the right to direct the Property Trustee in accordance with the terms of the
Securities. The foregoing provisions of this Section 2.6(b) shall be in lieu of
ss.ss. 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such ss.ss.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly
excluded from this Declaration and the Securities, as permitted by the Trust
Indenture Act. Subject to the foregoing provisions of this Section 2.6(b), upon
such waiver, any such Default shall cease to exist and any Event of Default with
respect to the Common Securities arising therefrom shall be deemed to have been
cured for every purpose of this Declaration, but no such waiver shall extend to
any subsequent or other Default or Event of Default with respect to the Common
Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by
the Property Trustee, at the direction of the Holders of the Capital Securities,
constitutes a waiver of the corresponding Event of Default under this
Declaration. The foregoing provisions of this Section 2.6(c) shall be in lieu of
ss. 316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act.
SECTION 2.7 DEFAULT; NOTICE.
(a) The Property Trustee shall, within 90 days after a
Responsible Officer obtains actual knowledge of the occurrence of a Default with
respect to the Securities, transmit by mail, first class postage prepaid, to the
Holders, notices of all such Defaults, unless such Defaults have been cured
before the giving of such notice or previously waived; PROVIDED, HOWEVER, that
except in the case of a Default arising from the nonpayment of principal of (or
premium, if any) or interest (including Compounded Interest and Additional Sums
(as such terms are defined in the
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Indenture), if any) or Liquidated Damages (as defined in the Registration Rights
Agreement) on any of the Debentures, the Property Trustee shall be protected in
withholding such notice if and so long as a Responsible Officer in good faith
determines that the withholding of such notice is in the interests of the
Holders.
(b) The Property Trustee shall not be deemed to have
knowledge of any Default or Event of Default except:
(i) a Default or Event of Default under Sections
5.01(a) (other than the payment of Compounded Interest,
Additional Sums and Liquidated Damages) and 5.01(b) of the
Indenture; or
(ii) any Default or Event of Default as to which
the Property Trustee shall have received written notice or
of which a Responsible Officer charged with the
administration of the Declaration shall have actual
knowledge.
(c) Within ten Business Days after a Responsible Officer
obtains actual knowledge of the occurrence of any Event of Default, the Property
Trustee shall transmit notice of such Event of Default to the Holders of the
Capital Securities, the Administrative Trustees and the Sponsor, unless such
Event of Default shall have been cured or waived. The Sponsor and the
Administrative Trustees shall file annually with the Property Trustee a
certification as to whether or not they are in compliance with all the
conditions and covenants applicable to them under this Declaration.
ARTICLE III
ORGANIZATION
SECTION 3.1 NAME.
The Trust is named "Reliance Capital Trust I" as such name
may be modified from time to time by the Administrative Trustees following
written notice to the Delaware Trustee, the Property Trustee and the Holders.
The Trust's activities may be conducted under the name of the Trust or any other
name deemed advisable by the Administrative Trustees.
SECTION 3.2 OFFICE.
The address of the principal office of the Trust is c/o
Reliance Bancorp, Inc., 585 Stewart Avenue, Garden City, New York 11530. On ten
Business Days' prior written notice to the Delaware Trustee, the Property
Trustee and the Holders of Securities, the Administrative Trustees may designate
another principal office.
SECTION 3.3 PURPOSE.
The exclusive purposes and functions of the Trust are (a)
to issue and sell Securities, (b) use the proceeds from the sale of the
Securities to acquire the Debentures, and (c) except as otherwise limited
herein, to engage in only those other activities necessary, advisable or
incidental thereto, including without limitation, those activities specified in
Sections 3.6, 3.8, 3.9, 3.10, 3.11 and/or 3.12. The Trust shall not borrow
money, issue debt or reinvest proceeds derived
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from investments, mortgage or pledge any of its assets, or otherwise undertake
(or permit to be undertaken) any activity that would cause the Trust not to be
classified for United States federal income tax purposes as a grantor trust.
SECTION 3.4 AUTHORITY.
Subject to the limitations provided in this Declaration
and to the specific duties of the Property Trustee, the Administrative Trustees
shall have exclusive and complete authority to carry out the purposes of the
Trust. An action taken by one or more of the Administrative Trustees in
accordance with their powers shall constitute the act of and serve to bind the
Trust and an action taken by the Property Trustee on behalf of the Trust in
accordance with its powers shall constitute the act of and serve to bind the
Trust. In dealing with the Trustees acting on behalf of the Trust, no Person
shall be required to inquire into the authority of the Trustees to bind the
Trust. Persons dealing with the Trust are entitled to rely conclusively on the
power and authority of the Trustees as set forth in this Declaration.
SECTION 3.5 TITLE TO PROPERTY OF THE TRUST.
Except as provided in Section 3.8 with respect to the
Debentures and the Property Trustee Account or as otherwise provided in this
Declaration, legal title to all assets of the Trust shall be vested in the
Trust. The Holders shall not have legal title to any part of the assets of the
Trust, but shall have an undivided beneficial interest in the assets of the
Trust.
SECTION 3.6 POWERS AND DUTIES OF THE ADMINISTRATIVE TRUSTEES.
The Administrative Trustees shall have the exclusive
power, duty and authority, and are hereby authorized and directed, to cause the
Trust to engage in the following activities:
(a) to execute, enter into and deliver the Common
Securities Subscription Agreement and to execute, deliver, issue and sell the
Securities in accordance with this Declaration; PROVIDED, HOWEVER, that except
as contemplated in Section 7.1(a), (i) the Trust may issue no more than one
series of Capital Securities and no more than one series of Common Securities,
(ii) there shall be no interests in the Trust other than the Securities, and
(iii) the issuance of Securities shall be limited to a simultaneous issuance of
both Capital Securities and Common Securities at the Closing Time;
(b) in connection with the issue and sale of the Capital
Securities and the consummation of the Exchange Offer, at the direction of the
Sponsor, to:
(i) prepare and execute, if necessary, an offering
memorandum (the "Offering Memorandum") in preliminary and
final form prepared by the Sponsor, in relation to the
offering and sale of Series A Capital Securities to QIBs
in reliance on Rule 144A and to institutional "accredited
investors" (as defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act), and to execute and file with
the Commission, at such time as determined by the Sponsor,
any Registration Statement, including any amendments
thereto, as contemplated by the Registration Rights
Agreement;
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(ii) execute and file any documents prepared by the
Sponsor, or take any acts as determined by the Sponsor to
be necessary in order to qualify or register all or part
of the Capital Securities in any State in which the
Sponsor has determined to qualify or register such Capital
Securities for sale;
(iii) execute and file an application, prepared by
the Sponsor, to permit the Capital Securities to trade or
be quoted or listed in or on the Private Offerings,
Resales and Trading through Automated Linkages ("PORTAL")
Market or any other securities exchange, quotation system
or the Nasdaq Stock Market's National Market;
(iv) execute and deliver the Common Securities
Subscription Agreement, the Debenture Subscription
Agreement, letters, documents, or instruments with DTC and
other Clearing Agencies relating to the Capital
Securities; and
(v) if required, execute and file with the
Commission a registration statement on Form 8-A, including
any amendments thereto, prepared by the Sponsor, relating
to the registration of the Capital Securities under
Section 12(b) or 12(g) of the Exchange Act, as the case
may be.
(c) to execute, enter into and deliver the Debenture
Subscription Agreement, to acquire the Series A Debentures with the proceeds of
the sale of the Series A Capital Securities and the Common Securities and to
exchange the Series A Debentures for a like principal amount of Series B
Debentures, pursuant to the Exchange Offer; PROVIDED, HOWEVER, that the
Administrative Trustees shall cause legal title to the Debentures to be held of
record in the name of the Property Trustee for the benefit of the Holders;
(d) to give the Sponsor and the Property Trustee prompt
written notice of the occurrence of a Special Event;
(e) to establish a record date with respect to all actions
to be taken hereunder that require a record date be established, including and
with respect to, for the purposes of ss. 316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of Capital Securities and Holders of Common Securities as
to such actions and applicable record dates;
(f) to take all actions and perform such duties as may be
required of the Administrative Trustees pursuant to the terms of the Securities;
(g) to the fullest extent permitted by law, to bring or
defend, pay, collect, compromise, arbitrate, resort to legal action, or
otherwise adjust claims or demands of or against the Trust ("Legal Action"),
unless pursuant to Section 3.8(e), the Property Trustee has the exclusive power
to bring such Legal Action;
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(h) to employ or otherwise engage employees and agents
(who may be designated as officers with titles) and managers, contractors,
advisors, and consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's
obligations under the Trust Indenture Act;
(j) to give the certificate required by ss. 314(a)(4) of
the Trust Indenture Act to the Property Trustee, which certificate may be
executed by any Administrative Trustee;
(k) to incur expenses that are necessary or incidental to
carry out any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as,
Registrar and Exchange Agent for the Securities or to appoint a Paying Agent for
the Securities as provided in Section 7.4 except for such time as such power to
appoint a Paying Agent is vested in the Property Trustee;
(m) to give prompt written notice to the Property Trustee
and to Holders of any notice received from the Debenture Issuer of its election
to defer payments of interest on the Debentures by extending the interest
payment period under the Indenture;
(n) to take all action that may be necessary or
appropriate for the preservation and the continuation of the Trust's valid
existence, rights, franchises and privileges as a statutory business trust under
the laws of the State of Delaware and of each other jurisdiction in which such
existence is necessary to protect the limited liability of the Holders or to
enable the Trust to effect the purposes for which the Trust was created;
(o) to take any action, not inconsistent with this
Declaration or with applicable law, that the Administrative Trustees determine
in their discretion to be necessary or desirable in carrying out the activities
of the Trust as set out in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered under the
Investment Company Act;
(ii) causing the Trust to continue to be classified
for United States federal income tax purposes as a grantor
trust; and
(iii) cooperating with the Debenture Issuer to
ensure that the Debentures will be treated as indebtedness
of the Debenture Issuer for United States federal income
tax purposes;
(p) to take all action necessary to consummate the
Exchange Offer or otherwise cause the Capital Securities to be registered
pursuant to an effective registration statement in accordance with the
provisions of the Registration Rights Agreement;
(q) to take all action necessary to cause all applicable
tax returns and tax information reports that are required to be filed with
respect to the Trust to be duly prepared and filed by the Administrative
Trustees, on behalf of the Trust; and
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(r) to execute and deliver all documents or instruments,
perform all duties and powers, and do all things for and on behalf of the Trust
in all matters necessary, advisable or incidental to the foregoing.
The Administrative Trustees must exercise the powers set
forth in this Section 3.6 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Administrative Trustees
shall not take any action that is inconsistent with the purposes and functions
of the Trust set forth in Section 3.3.
Subject to this Section 3.6, the Administrative Trustees
shall have none of the powers or the authority of the Property Trustee set forth
in Section 3.8.
Any expenses incurred by the Administrative Trustees
pursuant to this Section 3.6 shall be reimbursed by the Debenture Issuer.
SECTION 3.7 PROHIBITION OF ACTIONS BY THE TRUST AND THE TRUSTEES.
The Trust shall not, and the Trustees (including the
Property Trustee and the Delaware Trustee) shall not, and the Administrative
Trustees shall cause the Trust not to, engage in any activity other than as
required or authorized by this Declaration. The Trust shall not:
(i) invest any proceeds received by the Trust from
holding the Debentures, but shall distribute all such
proceeds to Holders pursuant to the terms of this
Declaration and of the Securities;
(ii) acquire any assets other than as expressly
provided herein;
(iii) possess Trust Property for other than a Trust
purpose or execute any mortgage in respect of, or pledge,
any Trust Property;
(iv) make any loans or incur any indebtedness other
than loans represented by the Debentures;
(v) possess any power or otherwise act in such a
way as to vary the Trust Property or the terms of the
Securities in any way whatsoever;
(vi) issue any securities or other evidences of
beneficial ownership of, or beneficial interest in, the
Trust other than the Securities;
(vii) other than as provided in this Declaration or
Annex I hereto, (A) direct the time, method and place of
conducting any proceeding with respect to any remedy
available to the Debenture Trustee, or exercising any
trust or power conferred upon the Debenture Trustee with
respect to the Debentures, (B) waive any past default that
is waivable under the Indenture, or (C) exercise any right
to rescind or annul any declaration that the principal of
all the Debentures shall be due and payable; or
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(viii) consent to any amendment, modification or
termination of the Indenture or the Debentures where such
consent shall be required unless the Trust shall have
received an opinion of independent tax counsel experienced
in such matters to the effect that such amendment,
modification or termination will not cause more than an
insubstantial risk that the Trust will not be classified
as a grantor trust for United States federal income tax
purposes.
SECTION 3.8 POWERS AND DUTIES OF THE PROPERTY TRUSTEE.
(a) The legal title to the Debentures shall be owned by
and held of record in the name of the Property Trustee in trust for the benefit
of the Trust and the Holders. The right, title and interest of the Property
Trustee to the Debentures shall vest automatically in each Person who may
hereafter be appointed as Property Trustee in accordance with Section 5.6. Such
vesting and cessation of title shall be effective whether or not conveyancing
documents with regard to the Debentures have been executed and delivered.
(b) The Property Trustee shall not transfer its right,
title and interest in the Debentures to the Administrative Trustees or to the
Delaware Trustee (if the Property Trustee does not also act as Delaware
Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated
non-interest bearing trust account (the "Property Trustee
Account") in the name of and under the exclusive control
of the Property Trustee on behalf of the Holders and, upon
the receipt of payments of funds made in respect of the
Debentures held by the Property Trustee, deposit such
funds into the Property Trustee Account and make payments
or cause the Paying Agent to make payments to the Holders
from the Property Trustee Account in accordance with
Section 6.1; funds in the Property Trustee Account shall
be held uninvested until disbursed in accordance with this
Declaration; and the Property Trustee Account shall be an
account that is maintained with a banking institution the
rating on whose long-term unsecured indebtedness by a
"nationally recognized statistical rating organization",
as that term is defined for purposes of Rule 436(g)(2)
under the Securities Act, is at least equal to the rating
assigned to the Capital Securities;
(ii) engage in such ministerial activities as shall
be necessary or appropriate to effect the redemption of
the Securities to the extent the Debentures are redeemed
or mature; and
(iii) upon written notice of distribution issued by
the Administrative Trustees in accordance with the terms
of the Securities, engage in such ministerial activities
as shall be necessary or appropriate to effect the
distribution of the Debentures to Holders upon the
occurrence of certain events.
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(d) The Property Trustee shall take all actions and
perform such duties as may be specifically required of the Property Trustee
pursuant to the terms of this Declaration and the Securities.
(e) Subject to Section 3.9(a), the Property Trustee shall
take any Legal Action which arises out of or in connection with an Event of
Default of which a Responsible Officer has actual knowledge or the Property
Trustee's duties and obligations under this Declaration or the Trust Indenture
Act and if the Property Trustee shall have failed to take such Legal Action, the
Holders of the Capital Securities may, to the fullest extent permitted by law,
take such Legal Action, to the same extent as if such Holders of Capital
Securities held an aggregate principal amount of Debentures equal to the
aggregate liquidation amount of such Capital Securities, without first
proceeding against the Property Trustee or the Trust; PROVIDED, HOWEVER, that if
an Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay the principal of or
premium, if any, or interest (including Compounded Interest and Additional Sums,
if any) or Liquidated Damages, if any, on the Debentures on the date such
principal, premium, if any, or interest (including Compounded Interest and
Additional Sums, if any) or Liquidated Damages, if any, is otherwise payable (or
in the case of redemption, on the redemption date), then a Holder of Capital
Securities may directly institute a proceeding for enforcement of payment to
such Holder of the principal of or premium, if any or interest (including
Compounded Interest and Additional Sums, if any) or Liquidated Damages, if any,
on the Debentures having a principal amount equal to the aggregate liquidation
amount of the Capital Securities of such Holder (a "Direct Action") on or after
the respective due date specified in the Debentures. In connection with such
Direct Action, the Holders of the Common Securities will be subrogated to the
rights of such Holder of Capital Securities to the extent of any payment made by
the Debenture Issuer to such Holder of Capital Securities in such Direct Action.
Except as provided in the preceding sentences, the Holders of Capital Securities
will not be able to exercise directly any other remedy available to the holders
of the Debentures.
(f) The Property Trustee shall continue to serve as a
Trustee until either:
(i) the Trust has been completely liquidated and
the proceeds of the liquidation distributed to the Holders
pursuant to the terms of the Securities and this
Declaration; or
(ii) a successor Property Trustee has been
appointed and has accepted that appointment in accordance
with Section 5.6 (a "Successor Property Trustee").
(g) The Property Trustee shall have the legal power to
exercise all of the rights, powers and privileges of a holder of Debentures
under the Indenture and, if an Event of Default actually known to a Responsible
Officer occurs and is continuing, the Property Trustee shall, for the benefit of
Holders, enforce its rights as holder of the Debentures subject to the rights of
the Holders pursuant to the terms of this Declaration and the Securities.
(h) The Property Trustee shall be authorized to undertake
any actions set forth in ss. 317(a) of the Trust Indenture Act.
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(i) For such time as the Property Trustee is the Paying
Agent, the Property Trustee may authorize one or more Persons to act as
additional Paying Agents and to pay Distributions, redemption payments or
liquidation payments on behalf of the Trust with respect to all Securities and
any such Paying Agent shall comply with ss. 317(b) of the Trust Indenture Act.
Any such additional Paying Agent may be removed by the Property Trustee at any
time the Property Trustee remains as Paying Agent and a successor Paying Agent
or additional Paying Agents may be (but are not required to be) appointed at any
time by the Property Trustee while the Property Trustee is acting as Paying
Agent.
(j) Subject to this Section 3.8, the Property Trustee
shall have none of the duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 3.6.
Notwithstanding anything expressed or implied to the
contrary in this Declaration or any Annex or Exhibit hereto, (i) the Property
Trustee must exercise the powers set forth in this Section 3.8 in a manner that
is consistent with the purposes and functions of the Trust set out in Section
3.3, and (ii) the Property Trustee shall not take any action that is
inconsistent with the purposes and functions of the Trust set out in Section
3.3.
SECTION 3.9 CERTAIN DUTIES AND RESPONSIBILITIES OF THE PROPERTY
TRUSTEE.
(a) The Property Trustee, before the occurrence of any
Event of Default (of which, other than in the case of Events of Default under
Sections 5.01(a) and 5.01(b) of the Indenture, a Responsible Officer of the
Property Trustee has actual knowledge) and after the curing or waiving of all
such Events of Default that may have occurred, shall undertake to perform only
such duties as are specifically set forth in this Declaration and in the
Securities and no implied covenants shall be read into this Declaration against
the Property Trustee. In case an Event of Default has occurred (that has not
been cured or waived pursuant to Section 2.6) of which a Responsible Officer has
actual knowledge, the Property Trustee shall exercise such of the rights and
powers vested in it by this Declaration, and use the same degree of care and
skill in their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(b) No provision of this Declaration shall be construed to
relieve the Property Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default
(of which, other than in the case of Events of Default
under Sections 5.01(a) and 5.01(b) of the Indenture, a
Responsible Officer of the Property Trustee has actual
knowledge) and after the curing or waiving of all such
Events of Default that may have occurred:
1. the duties and obligations of the Property
Trustee shall be determined solely by the express
provisions of this Declaration and in the
Securities and the Property Trustee shall not be
liable except for the performance of such duties
and obligations as are specifically set forth in
this Declaration
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and in the Securities, and no implied covenants or
obligations shall be read into this Declaration
against the Property Trustee; and
2. in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may
conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed therein, upon any certificates or
opinions furnished to the Property Trustee and
conforming to the requirements of this Declaration;
PROVIDED, HOWEVER, that in the case of any such
certificates or opinions that by any provision
hereof are specifically required to be furnished to
the Property Trustee, the Property Trustee shall be
under a duty to examine the same to determine
whether or not on their face they conform to the
requirements of this Declaration;
(ii) the Property Trustee shall not be liable for
any error of judgment made in good faith by a Responsible
Officer, unless it shall be proved that the Property
Trustee was negligent in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with
respect to any action taken or omitted to be taken by it
in good faith in accordance with the direction of the
Holders of a Majority in Liquidation Amount of the
Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the
Property Trustee, or exercising any trust or power
conferred upon the Property Trustee under this
Declaration;
(iv) no provision of this Declaration shall require
the Property Trustee to expend or risk its own funds or
otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any
of its rights or powers;
(v) the Property Trustee's sole duty with respect
to the custody, safekeeping and physical preservation of
the Debentures and the Property Trustee Account shall be
to deal with such property in a similar manner as the
Property Trustee deals with similar property for its own
account, subject to the protections and limitations on
liability afforded to the Property Trustee under this
Declaration and the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or
liability for or with respect to the value, genuineness,
existence or sufficiency of the Debentures or the payment
of any taxes or assessments levied thereon or in
connection therewith;
(vii) the Property Trustee shall not be liable for
any interest on any money received by it except as it may
otherwise agree in writing with the Sponsor. Money held by
the Property Trustee need not be segregated from other
funds held by it except in relation to the Property
Trustee Account maintained by the Property Trustee
pursuant to Section 3.8(c)(i) and except to the extent
otherwise required by law; and
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(viii) the Property Trustee shall not be
responsible for monitoring the compliance by the
Administrative Trustees or the Sponsor with their
respective duties under this Declaration, nor shall the
Property Trustee be liable for any default or misconduct
of the Administrative Trustees or the Sponsor.
SECTION 3.10 CERTAIN RIGHTS OF PROPERTY TRUSTEE.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively rely and
shall be fully protected in acting or refraining from
acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to
be genuine and to have been signed, sent or presented by
the proper party or parties;
(ii) any direction or act of the Sponsor or the
Administrative Trustees contemplated by this Declaration
may be sufficiently evidenced by an Officers' Certificate;
(iii) whenever in the administration of this
Declaration, the Property Trustee shall deem it desirable
that a matter be proved or established before taking,
suffering or omitting any action hereunder, the Property
Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part,
request and conclusively rely upon an Officers'
Certificate which, upon receipt of such request, shall be
promptly delivered by the Sponsor or the Administrative
Trustees;
(iv) the Property Trustee shall have no duty to see
to any recording, filing or registration of any instrument
(including any financing or continuation statement or any
filing under tax or securities laws) or any rerecording,
refiling or registration thereof;
(v) the Property Trustee may consult with counsel
or other experts of its selection and the advice or
opinion of such counsel and experts with respect to legal
matters or advice within the scope of such experts' area
of expertise shall be full and complete authorization and
protection in respect of any action taken, suffered or
omitted by it here under in good faith and in accordance
with such advice or opinion, such counsel may be counsel
to the Sponsor or any of its Affiliates, and may include
any of its employees, and the Property Trustee shall have
the right at any time to seek instructions concerning the
administration of this Declaration from any court of
competent jurisdiction;
(vi) the Property Trustee shall be under no
obligation to exercise any of the rights or powers vested
in it by this Declaration at the request or direction of
any Holder, unless such Holder shall have provided to the
Property Trustee security and indemnity, reasonably
satisfactory to the Property Trustee, against
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the costs, expenses (including reasonable attorneys' fees
and expenses and the expenses of the Property Trustee's
agents, nominees or custodians) and liabilities that might
be incurred by it in complying with such request or
direction, including such reasonable advances as may be
requested by the Property Trustee; provided, however,
that, nothing contained in this Section 3.10(a)(vi) shall
be taken to relieve the Property Trustee, upon the
occurrence of an Event of Default (of which, other than in
the case of Events of Default under Sections 5.01(a) and
5.01(b) of the Indenture, a Responsible Officer of the
Property Trustee has actual knowledge), of its obligation
to exercise the rights and powers vested in it by this
Declaration;
(vii) the Property Trustee shall not be bound to
make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Property
Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see
fit;
(viii) the Property Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, custodians,
nominees or attorneys and the Property Trustee shall not
be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by
it hereunder;
(ix) any action taken by the Property Trustee or
its agents hereunder shall bind the Trust and the Holders,
and the signature of the Property Trustee or its agents
alone shall be sufficient and effective to perform any
such action and no third party shall be required to
inquire as to the authority of the Property Trustee to so
act or as to its compliance with any of the terms and
provisions of this Declaration, both of which shall be
conclusively evidenced by the Property Trustee's or its
agent's taking such action;
(x) whenever in the administration of this
Declaration the Property Trustee shall deem it desirable
to receive instructions with respect to enforcing any
remedy or right or taking any other action hereunder, the
Property Trustee (i) may request instructions from the
Holders which instructions may only be given by the
Holders of the same proportion in liquidation amount of
the Securities as would be entitled to direct the Property
Trustee under the terms of the Securities in respect of
such remedy, right or action, (ii) may refrain from
enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be
protected in conclusively relying on or acting in or
accordance with such instructions;
(xi) except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be under any
obligation to take any action that is discretionary under
the provisions of this Declaration; and
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(xii) the Property Trustee shall not be liable for
any action taken, suffered, or omitted to be taken by it
in good faith, without negligence or willful misconduct,
and reasonably believed by it to be authorized or within
the discretion or rights or powers conferred upon it by
this Declaration.
(b) No provision of this Declaration shall be deemed to
impose any duty or obligation on the Property Trustee to perform any act or acts
or exercise any right, power, duty or obligation conferred or imposed on it, in
any jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
SECTION 3.11 DELAWARE TRUSTEE.
Notwithstanding any other provision of this Declaration
other than Section 5.2, the Delaware Trustee shall not be entitled to exercise
any powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Trustees described in this Declaration (except as
required under the Business Trust Act). Except as set forth in Section 5.2, the
Delaware Trustee shall be a Trustee for the sole and limited purpose of
fulfilling the requirements of ss. 3807 of the Business Trust Act. In the event
the Delaware Trustee shall at any time be required to take any action or perform
any duty hereunder, the Delaware Trustee shall be entitled to the benefits of
Section 3.9(b)(ii) to (viii), inclusive, and Section 3.10. No implied covenants
or obligations shall be read into this Declaration against the Delaware Trustee.
SECTION 3.12 EXECUTION OF DOCUMENTS.
Unless otherwise required by applicable law, each
Administrative Trustee, individually, is authorized to execute and deliver on
behalf of the Trust any documents, agreements, instruments or certificates that
the Administrative Trustees have the power and authority to execute pursuant to
Section 3.6.
SECTION 3.13 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained in this Declaration and the
Securities shall be taken as the statements of the Sponsor, and the Trustees do
not assume any responsibility for their correctness. The Trustees make no
representations as to the value or condition of the Trust Property or any part
thereof. The Trustees make no representations as to the validity or sufficiency
of this Declaration or the Securities.
SECTION 3.14 DURATION OF TRUST.
The Trust, unless dissolved pursuant to the provisions of
Article VIII hereof, shall have existence up to May 1, 2033.
SECTION 3.15 MERGERS.
(a) The Trust may not merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an
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entirety to any Person, except as described in Section 3.15(b) and (c) and
except with respect to the distribution of Debentures to Holders pursuant to
Section 8.1(a)(iii) of this Declaration or Section 3 of Annex I.
(b) The Trust may, at the request of the Sponsor, with the
consent of the Administrative Trustees or, if there are more than two, a
majority of the Administrative Trustees and without the consent of the Holders,
the Delaware Trustee or the Property Trustee, merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to, a trust organized as
such under the laws of any State; PROVIDED THAT:
(i) such successor entity (the "Successor Entity")
either:
1. expressly assumes all of the obligations of the
Trust under the Securities; or
2. substitutes for the Securities other securities
having substantially the same terms as the
Securities (the "Successor Securities") so long as
the Successor Securities rank the same as the
Securities rank in priority with respect to
Distributions and payments upon liquidation,
redemption and otherwise;
(ii) the Sponsor expressly appoints a trustee of
the Successor Entity that possesses the same powers and
duties as the Property Trustee with respect to the
Debentures;
(iii) the Successor Securities (excluding any
securities substituted for the Common Securities) are
listed, quoted or included for trading, or any Successor
Securities will be listed, quoted or included for trading
upon notification of issuance, on any national securities
exchange or with any other organization on which the
Capital Securities are then listed, quoted or included;
(iv) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause
the Capital Securities (including any Successor
Securities) or the Debentures to be downgraded by any
nationally recognized statistical rating organization that
publishes a rating on the Capital Securities or the
Debentures;
(v) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of
the Holders (including the holders of any Successor
Securities) in any material respect (other than with
respect to any dilution of the interests of such Holders
or holders, as the case may be, in the Successor Entity);
(vi) the Successor Entity has a purpose
substantially identical to that of the Trust;
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(vii) prior to such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease,
the Sponsor has received an opinion of independent counsel
to the Trust experienced in such matters to the effect
that:
1. such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and
privileges of the Holders (including the holders of
any Successor Securities) in any material respect
(other than with respect to any dilution of the
interests of such Holders or holders, as the case
may be, in the Successor Entity);
2. following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or
lease, neither the Trust nor the Successor Entity
will be required to register as an Investment
Company; and
3. following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or
lease, the Trust (or the Successor Entity) will
continue to be classified as a grantor trust for
United States federal income tax purposes;
(viii) the Sponsor or any permitted successor or
assignee owns all of the common securities of the
Successor Entity and guarantees the obligations of the
Successor Entity under the Successor Securities at least
to the extent provided by the Securities Guarantees; and
(ix) there shall have been furnished to the
Property Trustee an Officer's Certificate and an Opinion
of Counsel, each to the effect that all conditions
precedent in this Declaration to such transaction have
been satisfied.
(c) Notwithstanding Section 3.15(b), the Trust shall not,
except with the consent of Holders of 100% in liquidation amount of the
Securities, consolidate, amalgamate, merge with or into, or be replaced by, or
convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to, any other Person or permit any other Person to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer or lease
would cause the Trust or the Successor Entity not to be classified as a grantor
trust for United States federal income tax purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 SPONSOR'S PURCHASE OF COMMON SECURITIES.
At the Closing Time, pursuant to the Common Securities
Subscription Agreement, the Sponsor will purchase all of the Common Securities
then issued by the Trust, in an amount equal to at least 3% of the total capital
of the Trust, at the same time as the Series A Capital Securities are issued and
sold.
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SECTION 4.2 RESPONSIBILITIES OF THE SPONSOR.
In connection with the issue and sale of the Capital
Securities, the Sponsor shall have the exclusive right and responsibility to
engage in the following activities:
(a) to prepare the Offering Memorandum, in preliminary and
final form, and to prepare for filing by the Trust with the Commission any
Registration Statement, including any amendments thereto, as contemplated by the
Registration Rights Agreement;
(b) to determine the States in which to take appropriate
action to qualify or register for sale all or part of the Capital Securities and
to do any and all such acts, other than actions which must be taken by the
Trust, and advise the Trust of actions it must take, and prepare for execution
and filing any documents to be executed and filed by the Trust, as the Sponsor
deems necessary or advisable in order to comply with the applicable laws of any
such States;
(c) if deemed necessary or advisable by the Sponsor, to
prepare for filing by the Trust an application to permit the Capital Securities
to trade or be quoted or listed in or on the PORTAL market, or any other
securities exchange, quotation system or the Nasdaq Stock Market's National
Market;
(d) to prepare for filing by the Trust with the Commission
a registration statement on Form 8-A, including any amendments thereto, relating
to the registration of the Capital Securities under Section 12(b) or 12(g) of
the Exchange Act, as the case may be, including any amendments thereto; and
(e) to negotiate the terms of, execute, enter into and
deliver the Purchase Agreement, the Registration Rights Agreement and the
Liquidated Damages Agreement relating to the Capital Securities.
SECTION 4.3 RIGHT TO PROCEED.
The Sponsor acknowledges the rights of the Holders of
Capital Securities, in the event that a failure of the Trust to pay
Distributions on the Capital Securities is attributable to the failure of the
Debenture Issuer to pay the principal of or premium (if any) or interest on the
Debentures, to institute a proceeding directly against the Debenture Issuer for
enforcement of its payment obligations in respect of the Debentures.
SECTION 4.4 RIGHT TO DISSOLVE TRUST.
The Sponsor will have the right at any time to dissolve
the Trust and, after satisfaction of liabilities to creditors of the Trust as
required by applicable law, to cause the Debentures to be distributed to the
Holders in liquidation of the Trust. Such right is subject to the Sponsor's
having received (i) an Opinion of Counsel to the effect that such distribution
will not cause the holders of Capital Securities to recognize gain or loss for
United States federal income tax purposes and (ii) any required regulatory
approvals.
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ARTICLE V
TRUSTEES
SECTION 5.1 NUMBER OF TRUSTEES; APPOINTMENT OF CO-TRUSTEE.
The number of Trustees initially shall be five (5), and:
(a) at any time before the issuance of any Securities, the
Sponsor may, by written instrument, increase or decrease the number of Trustees;
and
(b) after the issuance of any Securities, the number of
Trustees may be increased or decreased by vote of the Holders of a Majority in
Liquidation Amount of the Common Securities voting as a class at a meeting of
the Holders of the Common Securities;
PROVIDED, HOWEVER, that, the number of Trustees shall in no event be less than
two (2); PROVIDED FURTHER that (1) one Trustee, in the case of a natural person,
shall be a person who is a resident of the State of Delaware or that, if not a
natural person, is an entity which has its principal place of business in the
State of Delaware (the "Delaware Trustee"); (2) there shall be at least one
Trustee who is an employee or officer of, or is affiliated with, the Sponsor (an
"Administrative Trustee"); and (3) one Trustee shall be the Property Trustee for
so long as this Declaration is required to qualify as an indenture under the
Trust Indenture Act, and such Trustee may also serve as Delaware Trustee if it
meets the applicable requirements. Notwithstanding the above, unless an Event of
Default shall have occurred and be continuing, at any time or times, for the
purpose of meeting the legal requirements of the Trust Indenture Act or of any
jurisdiction in which any part of the Trust Property may at the time be located,
the Holders of a Majority in Liquidation Amount of the Common Securities acting
as a class at a meeting of the Holders of the Common Securities, and the
Administrative Trustees shall have power to appoint one or more Persons either
to act as a co-trustee, jointly with the Property Trustee, of all or any part of
the Trust Property, or to act as separate trustee of any such property, in
either case with such powers as may be provided in the instrument of
appointment, and to vest in such Person or Persons in such capacity any
property, title, right or power deemed necessary or desirable, subject to the
provisions of this Declaration. In case an Event of Default has occurred and is
continuing, the Property Trustee alone shall have power to make any such
appointment of a co-trustee.
SECTION 5.2 DELAWARE TRUSTEE.
For so long as required by the Business Trust Act, the
Delaware Trustee shall be:
(a) a natural person who is a resident of the State of
Delaware; or
(b) if not a natural person, an entity which has its
principal place of business in the State of Delaware, and otherwise meets the
requirements of applicable law,
PROVIDED, however, THAT, if the Property Trustee has its principal place of
business in the State of Delaware and otherwise meets the requirements of
applicable law, then the Property Trustee shall also be the Delaware Trustee and
Section 3.11 shall have no application.
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The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
White Clay Center
Route 273
Newark, Delaware 19711
SECTION 5.3 PROPERTY TRUSTEE; ELIGIBILITY.
(a) There shall at all times be one Trustee (the "Property
Trustee") which shall act as Property Trustee and which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any
State or Territory thereof or of the District of Columbia,
or a corporation or Person permitted by the Commission to
act as an indenture trustee under the Trust Indenture Act,
authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least
10 million U.S. dollars ($10,000,000), and subject to
supervision or examination by federal, state, territorial
or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant
to law or to the requirements of the supervising or
examining authority referred to above, then for the
purposes of this Section 5.3(a)(ii), the combined capital
and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most
recent report of condition so published.
(b) If at any time the Property Trustee shall cease to be
eligible to so act under Section 5.3(a), the Property Trustee shall immediately
resign in the manner and with the effect set forth in Section 5.6(c).
(c) If the Property Trustee has or shall acquire any
"conflicting interest" within the meaning of ss. 330(b) of the Trust Indenture
Act, the Property Trustee and the Holder of the Common Securities (as if it were
the obligor referred to in ss. 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of ss. 310(b) of the Trust Indenture Act.
(d) The Capital Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause (i) of the
first proviso contained in ss.310 (b) of the Trust Indenture Act.
(e) The initial Property Trustee shall be:
The Bank of New York
101 Barclay Street - 21 West
New York, New York 10286
Attention: Corporate Trust Department
Telecopier: (212) 815-5915
Telephone: (212) 815-2588
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SECTION 5.4 CERTAIN QUALIFICATIONS OF ADMINISTRATIVE TRUSTEES AND
DELAWARE TRUSTEE GENERALLY.
Each Administrative Trustee and the Delaware Trustee
(unless the Property Trustee also acts as Delaware Trustee) shall be either a
natural person who is at least 21 years of age or a legal entity that shall act
through one or more Authorized Officers.
SECTION 5.5 ADMINISTRATIVE TRUSTEES.
The initial Administrative Trustees shall be:
Raymond A. Nielsen
Gerald M. Sauvigne
Paul D. Hagan
c/o Reliance Bancorp, Inc.
585 Stewart Avenue
Garden City, New York 11530
Telecopier: (516) 222-1805
Telephone: (516) 222-9300
(a) Except as expressly set forth in this Declaration and
except if a meeting of the Administrative Trustees is called with respect to any
matter over which the Administrative Trustees have power to act, any power of
the Administrative Trustees may be exercised by, or with the consent of, any one
such Administrative Trustee.
(b) Unless otherwise required by the applicable law, any
Administrative Trustee acting alone is authorized to execute on behalf of the
Trust any documents which the Administrative Trustees have the power and
authority to cause the Trust to execute pursuant to Section 3.6.
(c) An 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 purposes of signing any documents which the
Administrative Trustees have power and authority to cause the Trust to execute
pursuant to Section 3.6.
SECTION 5.6 APPOINTMENT, REMOVAL AND RESIGNATION OF TRUSTEES.
(a) Subject to Section 5.6(b) hereof and to Section 6(b)
of Annex I hereto, Trustees may be appointed or removed without cause at any
time:
(i) until the issuance of any Securities, by
written instrument executed by the Sponsor;
(ii) unless an Event of Default shall have occurred
and be continuing after the issuance of any Securities, by
vote of the Holders of a Majority in Liquidation Amount of
the Common Securities voting as a class at a meeting of
the Holders of the Common Securities; and
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(iii) if an Event of Default shall have occurred
and be continuing after the issuance of the Securities,
with respect to the Property Trustee or the Delaware
Trustee, by vote of Holders of a Majority in Liquidation
Amount of the Capital Securities voting as a class at a
meeting of Holders of the Capital Securities.
(b) (i) The Trustee that acts as Property Trustee shall
not be removed in accordance with Section 5.6(a) until a Successor Property
Trustee has been appointed and has accepted such appointment by written
instrument executed by such Successor Property Trustee and delivered to the
removed Property Trustee, the Administrative Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall
not be removed in accordance with this Section 5.6(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections 5.2 and
5.4 (a "Successor Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Delaware Trustee
and delivered to the removed Delaware Trustee, the Property Trustee (if the
removed Delaware Trustee is not also the Property Trustee), the Administrative
Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until
his successor shall have been appointed or until his death, removal or
resignation. Any Trustee may resign from office (without need for prior or
subsequent accounting) by an instrument in writing signed by the Trustee and
delivered to the other Trustees, the Sponsor and the Trust, which resignation
shall take effect upon such delivery or upon such later date as is specified
therein; PROVIDED, HOWEVER, that:
(i) No such resignation of the Trustee that acts as
the Property Trustee shall be effective:
1. until a Successor Property Trustee has been
appointed and has accepted such appointment by
instrument executed by such Successor Property
Trustee and delivered to the Trust, the Sponsor,
the Delaware Trustee (if the resigning Property
Trustee is not also the Delaware Trustee) and the
resigning Property Trustee; or
2. until the assets of the Trust have been
completely liquidated and the proceeds thereof
distributed to the Holders; and
(ii) no such resignation of the Trustee that acts
as the Delaware Trustee shall be effective until a
Successor Delaware Trustee has been appointed and has
accepted such appointment by instrument executed by such
Successor Delaware Trustee and delivered to the Trust, the
Property Trustee (if the resigning Delaware Trustee is not
also the Property Trustee), the Sponsor and the resigning
Delaware Trustee.
(d) The Holders of the Common Securities or, if an Event
of Default shall have occurred and be continuing after the issuance of the
Securities, the Holders of the Capital Securities shall use their best efforts
to promptly appoint a Successor Delaware Trustee or Successor Property
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Trustee, as the case may be, if the Property Trustee or the Delaware Trustee
delivers an instrument of resignation in accordance with this Section 5.6.
(e) If no Successor Property Trustee or Successor Delaware
Trustee shall have been appointed and accepted appointment as provided in this
Section 5.6 within 60 days after delivery of an instrument of resignation or
removal, the Property Trustee or Delaware Trustee resigning or being removed, as
applicable, may petition any court of competent jurisdiction for appointment of
a Successor Property Trustee or Successor Delaware Trustee. Such court may
thereupon, after prescribing such notice, if any, as it may deem proper and
prescribe, appoint a Successor Property Trustee or Successor Delaware Trustee,
as the case may be.
(f) No Property Trustee or Delaware Trustee shall be
liable for the acts or omissions to act of any Successor Property Trustee or
Successor Delaware Trustee, as the case may be.
(g) At the time of resignation or removal of the Property
Trustee or the Delaware Trustee, the Sponsor shall pay to such Trustee any
amounts that may be owed to such Trustee pursuant to Section 10.4.
SECTION 5.7 VACANCIES AMONG TRUSTEES.
If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 5.l, or if the number of
Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Administrative
Trustees or, if there are more than two, a majority of the Administrative
Trustees shall be conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance with Section 5.6.
SECTION 5.8 EFFECT OF VACANCIES.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to dissolve, terminate or annul the Trust or to
terminate this Declaration. Whenever a vacancy in the number of Administrative
Trustees shall occur, until such vacancy is filled by the appointment of an
Administrative Trustee in accordance with Section 5.6, the Administrative
Trustees in office, regardless of their number, shall have all the powers
granted to the Administrative Trustees and shall discharge all the duties
imposed upon the Administrative Trustees by this Declaration.
SECTION 5.9 MEETINGS.
If there is more than one Administrative Trustee, meetings
of the Administrative Trustees shall be held from time to time upon the call of
any Administrative Trustee. Regular meetings of the Administrative Trustees may
be held at a time and place fixed by resolution of the Administrative Trustees.
Notice of any in-person meetings of the Administrative Trustees shall be hand
delivered or otherwise delivered in writing (including by facsimile, with a hard
copy by overnight courier) not less than 24 hours before such meeting. Notice of
any telephonic meetings of
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the Administrative Trustees or any committee thereof shall be hand delivered or
otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 24 hours before a meeting. Notices shall
contain a brief statement of the time, place and anticipated purposes of the
meeting. The presence (whether in person or by telephone) of an Administrative
Trustee at a meeting shall constitute a waiver of notice of such meeting except
where an Administrative Trustee attends a meeting for the express purpose of
objecting to the transaction of any activity on the ground that the meeting has
not been lawfully called or convened. Unless provided otherwise in this
Declaration, any action of the Administrative Trustees may be taken at a meeting
by vote of a majority of the Administrative Trustees present (whether in person
or by telephone) and eligible to vote with respect to such matter, provided
that, a Quorum is present, or without a meeting by the unanimous written consent
of the Administrative Trustees. In the event there is only one Administrative
Trustee, any and all action of such Administrative Trustee shall be evidenced by
a written consent of such Administrative Trustee.
SECTION 5.10 DELEGATION OF POWER.
(a) Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 3.6, including any registration statement or amendment
thereto filed with the Commission, or making any other governmental filing.
(b) The Administrative Trustees shall have power to
delegate from time to time to such of their number or to officers of the Trust
the doing of such things and the execution of such instruments either in the
name of the Trust or the names of the Administrative Trustees or otherwise as
the Administrative Trustees may deem expedient, to the extent such delegation is
not prohibited by applicable law or contrary to the provisions of this
Declaration.
SECTION 5.11 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS.
Any Person into which the Property Trustee or the Delaware
Trustee or any Administrative Trustee that is not a natural person, as the case
may be, may be merged or converted or with which it may be consolidated, or any
Person resulting from any merger, conversion or consolidation to which the
Property Trustee or the Delaware Trustee, as the case may be, shall be a party,
or any Person succeeding to all or substantially all the corporate trust
business of the Property Trustee or the Delaware Trustee, as the case may be,
shall be the successor of the Property Trustee or the Delaware Trustee, as the
case may be, hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided such Person shall
be otherwise qualified and eligible under this Article.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 DISTRIBUTIONS.
Holders shall receive Distributions in accordance with the
applicable terms of the relevant Holder's Securities. If and to the extent that
the Debenture Issuer makes a payment of interest (including Compounded Interest
and Additional Sums), premium and/or principal on the Debentures held by the
Property Trustee or Liquidated Damages or any other payments pursuant to
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the Registration Rights Agreement or Liquidated Damages Agreement with respect
to the Debentures held by the Property Trustee (the amount of any such payment
being a "Payment Amount"), the Property Trustee shall and is directed, to the
extent funds are available for that purpose, to make a distribution (a
"Distribution") of the Payment Amount to Holders in accordance with the terms of
the Securities.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 GENERAL PROVISIONS REGARDING SECURITIES.
(a) The Administrative Trustees shall on behalf of the
Trust issue one class of capital securities representing undivided preferred
beneficial interests in the assets of the Trust having such terms as are set
forth in Annex I (the "Series A Capital Securities") and one class of common
securities representing common undivided beneficial interests in the assets of
the Trust having such terms as are set forth in Annex I (the "Common
Securities"). The Administrative Trustees shall on behalf of the Trust issue one
class of capital securities representing undivided preferred beneficial
interests in the Trust having such terms as set forth in Annex I (the "Series B
Capital Securities") in exchange for the Series A Capital Securities accepted
for exchange in the Exchange Offer, which Series B Capital Securities shall not
bear the legends required by Section 9.2(i) unless the Holder of such Series A
Capital Securities is either (A) a broker-dealer who purchased such Series A
Capital Securities directly from the Trust for resale pursuant to Rule 144A or
any other available exemption under the Securities Act, (B) a Person
participating in the distribution of the Series A Capital Securities or (C) a
Person who is an Affiliate of the Sponsor or the Trust. The Trust shall issue no
securities or other interests in the assets of the Trust other than the Capital
Securities and the Common Securities.
(b) The consideration received by the Trust for the
issuance of the Securities shall constitute a contribution to the capital of the
Trust and shall not constitute a loan to the Trust.
(c) Upon issuance of the Securities as provided in this
Declaration, the Securities so issued shall be deemed to be validly issued,
fully paid and non-assessable.
(d) Every Person, by virtue of having become a Holder or a
Capital Security Beneficial Owner in accordance with the terms of this
Declaration, shall be deemed to have expressly assented and agreed to the terms
of, and shall be bound by, this Declaration.
SECTION 7.2 EXECUTION AND AUTHENTICATION.
(a) The Securities shall be signed on behalf of the Trust
by an Administrative Trustee. In case any Administrative Trustee of the Trust
who shall have signed any of the Securities shall cease to be such
Administrative Trustee before the Securities so signed shall be delivered by the
Trust, such Securities nevertheless may be delivered as though the Person who
signed such Securities had not ceased to be such Administrative Trustee; and any
Securities may be signed on behalf of the Trust by such persons who, at the
actual date of execution of such Security, shall be the Administrative Trustees
of the Trust, although at the date of the execution and delivery of this
Declaration any such person was not an Administrative Trustee.
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(b) One Administrative Trustee shall sign the Capital
Securities for the Trust by manual or facsimile signature. Unless otherwise
determined by an Administrative Trustee on behalf of the Trust, such signature
shall, in the case of Common Securities, be a manual signature.
A Capital Security shall not be valid until authenticated
by the manual signature of an authorized signatory of the Property Trustee. The
signature shall be conclusive evidence that the Capital Security has been
authenticated under this Declaration. A Common Security shall be valid upon
execution by an Administrative Trustee without any act of the Property Trustee.
Upon a written order of the Trust signed by one
Administrative Trustee, the Property Trustee shall authenticate the Capital
Securities for original issue. The aggregate number of Capital Securities
outstanding at any time shall not exceed the number set forth in Annex I hereto
except as provided in Section 7.6.
The Property Trustee may appoint an authenticating agent
acceptable to the Trust to authenticate Capital Securities. An authenticating
agent may authenticate Capital Securities whenever the Property Trustee may do
so. Each reference in this Declaration to authentication by the Property Trustee
includes authentication by such agent. An authenticating agent has the same
rights as the Property Trustee hereunder with respect to the Sponsor or an
Affiliate.
SECTION 7.3 FORM AND DATING.
The Capital Securities shall be evidenced by one or more
certificates substantially in the form of Exhibit A-1, and the Common Securities
shall be evidenced by one or more certificates substantially in the form of
Exhibit A-2. The Property Trustee's certificate of authentication shall be
substantially in the form set forth in Exhibit A-1. Certificates representing
the Securities may be printed, lithographed or engraved or may be produced in
any other manner as is reasonably acceptable to an Administrative Trustee, as
evidenced by the execution thereof. The Securities may have letters, "CUSIP" or
other numbers, notations or other marks of identification or designation and
such legends or endorsements required by law, stock exchange rule, agreements to
which the Trust is subject, if any, or usage, PROVIDED THAT, any such notation,
legend or endorsement is in a form acceptable to the Administrative Trustees,
as evidenced by their execution thereof. The Trust at the direction of the
Sponsor, shall furnish any such legend not contained in Exhibit A-1 to the
Property Trustee in writing. Each Capital Security shall be dated the date of
its authentication. The terms and provisions of the Securities set forth in
Annex I and the forms of Securities set forth in Exhibits A-1 and A-2 are part
of the terms of this Declaration and, to the extent applicable, the Property
Trustee and the Sponsor, by their execution and delivery of this Declaration,
expressly agree to such terms and provisions and to be bound thereby.
(a) GLOBAL CAPITAL SECURITY. Capital Securities offered
and sold to QIBs in reliance on Rule 144A, as provided in the Purchase
Agreement, shall be issued in the form of a single permanent global Capital
Security in definitive, fully registered form without distribution coupons with
the appropriate global legends and Restricted Securities Legend set forth in
Exhibit A-1 hereto (the "Global Capital Security"), which shall be deposited on
behalf of the purchasers of the Capital Securities represented thereby with the
Property Trustee, at its New York, New York office, as custodian for the
Clearing Agency, and registered in the name of the Clearing Agency or a nominee
of the Clearing Agency, duly executed by the Trust and authenticated by the
Property
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Trustee as hereinafter provided. The number of Capital Securities represented by
the Global Capital Security may from time to time be increased or decreased by
adjustments made on the records of the Property Trustee and the Clearing Agency
or its nominee as hereinafter provided.
(b) BOOK-ENTRY PROVISIONS. This Section 7.3(b) shall apply
only to the Global Capital Security and such other Capital Securities in global
form as may be authorized by the Trust to be deposited with or on behalf of the
Clearing Agency.
An Administrative Trustee shall execute and the Property
Trustee shall, in accordance with this Section 7.3, authenticate and make
available for delivery initially a single Global Capital Security that (i) shall
be registered in the name of Cede & Co. or other nominee of such Clearing Agency
and (ii) shall be delivered by the Property Trustee to such Clearing Agency or
pursuant to such Clearing Agency's written instructions or, if no such written
instructions are received by the Property Trustee, held by the Property Trustee
as custodian for the Clearing Agency.
Members of, or participants in, the Clearing Agency
("Participants") shall have no rights under this Declaration with respect to the
Global Capital Security held on their behalf by the Clearing Agency or by the
Property Trustee as the custodian of the Clearing Agency or under such Global
Capital Security, and the Clearing Agency may be treated by the Trust, the
Property Trustee and any agent of the Trust or the Property Trustee as the
absolute owner of such Global Capital Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Trust, the
Property Trustee or any agent of the Trust or the Property Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Clearing Agency or impair, as between the Clearing Agency and its
Participants, the operation of customary practices of such Clearing Agency
governing the exercise of the rights of a holder of a beneficial interest in the
Global Capital Security.
(c) DEFINITIVE CAPITAL SECURITIES. Except as provided in
Section 7.9 or 9.2(f)(i), owners of beneficial interests in the Global Capital
Security will not be entitled to receive physical delivery of certificated
Capital Securities ("Definitive Capital Securities"). Purchasers of Securities
who are "accredited investors" (as defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act) and who are not QIBs will receive Capital Securities
in the form of individual certificates in definitive, fully registered form
without distribution coupons and with the Restricted Securities Legend set forth
in Exhibit A-1 hereto ("Restricted Definitive Capital Securities"); PROVIDED,
HOWEVER, that upon registration of transfer of such Restricted Definitive
Capital Securities to a QIB, such Restricted Definitive Capital Securities will,
unless the Global Capital Security has previously been exchanged, be exchanged
for an interest in the Global Capital Security pursuant to the provisions of
Section 9.2. Restricted Definitive Capital Securities will bear the Restricted
Securities Legend set forth on Exhibit A-1 unless removed in accordance with
this Section 7.3 or Section 9.2.
SECTION 7.4 REGISTRAR, PAYING AGENT AND EXCHANGE AGENT.
The Trust shall maintain in New York, New York (i) an
office or agency where Capital Securities may be presented for registration of
transfer ("Registrar"), (ii) an office or agency where Capital Securities may be
presented for payment ("Paying Agent") and (iii) an office or agency where
Securities may be presented for exchange ("Exchange Agent"). The Registrar shall
keep a register of the Capital Securities and of their transfer. The Trust may
appoint the Registrar,
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the Paying Agent and the Exchange Agent and may appoint one or more
co-registrars, one or more additional paying agents and one or more additional
exchange agents in such other locations as it shall determine. The term
"Registrar" includes any additional registrar, the term "Paying Agent" includes
any additional paying agent and the term "Exchange Agent" includes any
additional exchange agent. The Trust may change any Paying Agent, Registrar,
co-registrar or Exchange Agent without prior notice to any Holder. The Paying
Agent shall be permitted to resign as Paying Agent upon 30 days' written notice
to the Property Trustee, the Administrative Trustees and the Sponsor. The Trust
shall notify the Property Trustee of the name and address of any Agent not a
party to this Declaration. If the Trust fails to appoint or maintain another
entity as Registrar, Paying Agent or Exchange Agent, the Property Trustee shall
act as such. The Trust or any of its Affiliates may act as Paying Agent,
Registrar, or Exchange Agent. The Trust shall act as Paying Agent, Registrar and
Exchange Agent for the Common Securities.
The Trust initially appoints the Property Trustee as
Registrar, Paying Agent and Exchange Agent for the Capital Securities.
SECTION 7.5 PAYING AGENT TO HOLD MONEY IN TRUST.
The Trust shall require each Paying Agent other than the
Property Trustee to agree in writing that the Paying Agent will hold in trust
for the benefit of Holders or the Property Trustee all money held by the Paying
Agent for the payment of liquidation amounts or Distributions, and will notify
the Property Trustee if there are insufficient funds for such purpose. While any
such insufficiency continues, the Property Trustee may require a Paying Agent to
pay all money held by it to the Property Trustee. The Trust at any time may
require a Paying Agent to pay all money held by it to the Property Trustee and
to account for any money disbursed by it. Upon payment over to the Property
Trustee, the Paying Agent (if other than the Trust or an Affiliate of the Trust)
shall have no further liability for the money. If the Trust or the Sponsor or an
Affiliate of the Trust or the Sponsor acts as Paying Agent, it shall segregate
and hold in a separate trust fund for the benefit of the Holders all money held
by it as Paying Agent.
SECTION 7.6 REPLACEMENT SECURITIES.
If a Holder claims that a Security owned by it has been
lost, destroyed or wrongfully taken or if such Security is mutilated and is
surrendered to the Trust or in the case of the Capital Securities to the
Property Trustee, an Administrative Trustee shall execute and the Property
Trustee shall authenticate and make available for delivery a replacement
Security if the Property Trustee's requirements are met. An indemnity bond must
be provided by the Holder which, in the judgment of the Property Trustee, is
sufficient to protect the Trustees, the Sponsor, the Trust or any authenticating
agent from any loss which any of them may suffer if a Security is replaced. The
Trust may charge such Holder for its expenses in replacing a Security.
SECTION 7.7 OUTSTANDING CAPITAL SECURITIES.
The Capital Securities outstanding at any time are all the
Capital Securities authenticated by the Property Trustee except for those
cancelled by it, those delivered to it for cancellation, and those described in
this Section as not outstanding.
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If a Capital Security is replaced, paid or purchased
pursuant to Section 7.6 hereof, it ceases to be outstanding unless the Property
Trustee receives proof satisfactory to it that the replaced, paid or purchased
Capital Security is held by a bona fide purchaser.
If Capital Securities are considered paid in accordance
with the terms of this Declaration, they cease to be outstanding and
Distributions on them shall cease to accumulate.
A Capital Security does not cease to be outstanding
because one of the Trust, the Sponsor or an Affiliate of the Sponsor holds the
Security.
SECTION 7.8 CAPITAL SECURITIES IN TREASURY.
In determining whether the Holders of the required amount
of Securities have concurred in any direction, waiver or consent, Capital
Securities owned by the Trust, the Sponsor or an Affiliate of the Sponsor, as
the case may be, shall be disregarded and deemed not to be outstanding, except
that for the purposes of determining whether the Property Trustee shall be fully
protected in relying on any such direction, waiver or consent, only Securities
which the Property Trustee actually knows are so owned shall be so disregarded.
SECTION 7.9 TEMPORARY SECURITIES.
(a) Until Definitive Capital Securities are ready for
delivery, the Trust may prepare and, in the case of the Capital Securities, the
Property Trustee shall authenticate temporary Securities. Temporary Securities
shall be substantially in the form of Definitive Capital Securities but may have
variations that the Trust considers appropriate for temporary Securities.
Without unreasonable delay, the Trust shall prepare and, in the case of the
Capital Securities, the Property Trustee shall authenticate Definitive Capital
Securities in exchange for temporary Securities.
(b) The Global Capital Security deposited with the
Clearing Agency or with the Property Trustee as custodian for the Clearing
Agency pursuant to Section 7.3 shall be transferred to the beneficial owners
thereof in the form of Definitive Capital Securities only if such transfer
complies with Section 9.2 and (i) the Clearing Agency notifies the Sponsor that
it is unwilling or unable to continue as Clearing Agency for such Global Capital
Security or if at any time such Clearing Agency ceases to be a "clearing agency"
registered under the Exchange Act, and, in each case, a clearing agency is not
appointed by the Sponsor within 90 days of receipt of such notice or of becoming
aware of such condition, (ii) a Default or an Event of Default has occurred and
is continuing or (iii) the Trust at its sole discretion elects to cause the
issuance of Definitive Securities.
(c) Any Global Capital Security that is transferable to
the beneficial owners thereof in the form of Definitive Capital Securities
pursuant to this Section 7.9 shall be surrendered by the Clearing Agency to the
Property Trustee located in New York, New York to be so transferred, in whole or
from time to time in part, without charge, and the Property Trustee shall
authenticate and make available for delivery, upon such transfer of each portion
of such Global Capital Security, an equal aggregate liquidation amount of
Securities of authorized denominations in the form of Definitive Capital
Securities. Any portion of the Global Capital Security transferred pursuant to
this Section shall be registered in such names as the Clearing Agency shall
direct. Any Definitive Capital Security delivered in exchange for an interest in
the Restricted Global Capital Security shall, except
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as otherwise provided by Sections 7.3 and 9.1, bear the Restricted Securities
Legend set forth in Exhibit A-l hereto.
(d) Subject to the provisions of Section 7.9(c), the
Holder of the Global Capital Security may grant proxies and otherwise authorize
any Person, including Participants and Persons that may hold interests through
Participants, to take any action which such Holder is entitled to take under
this Declaration or the Securities.
(e) In the event of the occurrence of any of the events
specified in Section 7.9(b), the Trust will promptly make available to the
Property Trustee a reasonable supply of certificated Capital Securities in
fully registered form without distribution coupons.
SECTION 7.10 CANCELLATION.
The Trust at any time may deliver Capital Securities to
the Property Trustee for cancellation. The Registrar, Paying Agent and Exchange
Agent shall forward to the Property Trustee any Capital Securities surrendered
to them for registration of transfer, redemption, exchange or payment. The
Property Trustee shall promptly cancel all Capital Securities, surrendered for
registration of transfer, redemption, exchange, payment, replacement or
cancellation and shall dispose of cancelled Capital Securities in accordance
with its customary procedures unless the Trust otherwise directs. The Trust may
not issue new Capital Securities to replace Capital Securities that it has paid
or that have been delivered to the Property Trustee for cancellation or that any
Holder has exchanged.
SECTION 7.11 CUSIP NUMBERS.
The Trust in issuing the Capital Securities may use
"CUSIP" numbers (if then generally in use), and, if so, the Property Trustee
shall use "CUSIP" numbers in notices of redemption as a convenience to Holders
of Capital Securities; PROVIDED THAT, any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Capital Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Capital Securities, and any such redemption shall not be affected by any defect
in or omission of such numbers. The Sponsor will promptly notify the Property
Trustee of any change in the CUSIP numbers.
ARTICLE VIII
DISSOLUTION OF TRUST
SECTION 8.1 DISSOLUTION OF TRUST.
(a) The Trust shall dissolve:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of
dissolution or liquidation or its equivalent with respect
to the Sponsor; or the revocation of the Sponsor's charter
and the expiration of 90 days after the date of revocation
without a reinstatement thereof;
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(iii) following the distribution of a Like Amount
of the Debentures to the Holders, PROVIDED THAT, the
Property Trustee has received written notice from the
Sponsor directing the Property Trustee to dissolve the
Trust (which direction is optional, and except as
otherwise expressly provided below, within the discretion
of the Sponsor) and PROVIDED, FURTHER, that such direction
and such distribution is conditioned on (a) the receipt by
the Sponsor of any and all required regulatory approvals,
and (b) the Sponsor's receipt and delivery to the
Administrative Trustees of an opinion of independent tax
counsel experienced in such matters, which opinion may
rely on public or private rulings of the Internal Revenue
Service, to the effect that the Holders of the Capital
Securities will not recognize any gain or loss for United
States federal income tax purposes as a result of the
dissolution of the Trust and the distribution of
Debentures;
(iv) upon the entry of a decree of judicial
dissolution of the Trust by a court of competent
jurisdiction;
(v) when all of the Securities shall have been
called for redemption and the amounts necessary for
redemption thereof shall have been paid to the Holders in
accordance with the terms of the Securities;
(vi) upon the redemption or repayment of the
Debentures or at such time as no Debentures are
outstanding; or
(vii) the expiration of the term of the Trust
provided in Section 3.14.
(b) As soon as is practicable upon completion of winding
up of the Trust following the occurrence of an event referred to in Section
8.1(a), the Administrative Trustees shall terminate the Trust by filing a
certificate of cancellation with the Secretary of State of the State of Delaware
in accordance with the Business Trust Act.
(c) The provisions of Section 3.9 and Article X shall
survive the termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 TRANSFER OF SECURITIES.
(a) Securities may only be transferred, in whole or in
part, in accordance with the terms and conditions set forth in this Declaration
and in the terms of the Securities. To the fullest extent permitted by law, any
transfer or purported transfer of any Security not made in accordance with this
Declaration shall be null and void.
(b) Subject to this Article IX, Capital Securities may
only be transferred, in whole or in part, in accordance with the terms and
conditions set forth in this Declaration. To the fullest extent permitted by
law, any transfer or purported transfer of any Security not made in accor dance
with this Declaration shall be null and void.
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(c) For so long as the Securities remain outstanding, the
Sponsor agrees (i) not to transfer ownership of the Common Securities of the
Trust, provided that any permitted successor of the Sponsor under the Indenture
may succeed to the Sponsor's ownership of the Common Securities, (ii) not to
cause, as Sponsor of the Trust, or to permit, as Holder of the Common
Securities, the dissolution, winding-up or termination of the Trust, except as
provided in this Declaration and (iii) to use its best efforts to cause the
Trust (a) to remain a business trust, except in connection with the distribution
of Debentures to the Holders in liquidation of the Trust, the redemption of all
of the Securities, or certain mergers, consolidations or amalgamations, each as
permitted by this Declaration, and (b) to otherwise continue to be classified as
a grantor trust for United States federal income tax purposes.
(d) The Registrar shall provide for the registration of
Capital Securities and of the transfer of Capital Securities, which will be
effected without charge but only upon payment (with such indemnity as the
Registrar may require) in respect of any tax or other governmental charges that
may be imposed in relation to it. Upon surrender for registration of transfer of
any Capital Securities, an Administrative Trustee shall cause one or more new
Capital Securities to be issued in the name of the designated transferee or
transferees. Every Capital Security surrendered for registration of transfer
shall be accompanied by a written instrument of transfer in form satisfactory to
the Registrar duly executed by the Holder or such Holder's attorney duly
authorized in writing. Each Capital Security surrendered for registration of
transfer shall be delivered to the Registrar and canceled in accordance with
Section 7.10. A transferee of a Capital Security shall be entitled to the rights
and subject to the obligations of a Holder hereunder upon the receipt by such
transferee of a Capital Security. By acceptance of a Capital Security or any
interest therein, each transferee shall be deemed to have agreed to be bound by
this Declaration.
SECTION 9.2 TRANSFER PROCEDURES AND RESTRICTIONS.
(a) General. Except as otherwise provided in Section
9.2(b), if Capital Securities are issued upon the transfer, exchange or
replacement of Capital Securities bearing the Restricted Securities Legend set
forth in Exhibit A-1 hereto, or if a request is made to remove such Restricted
Securities Legend on Capital Securities, the Capital Securities so issued shall
bear the Restricted Securities Legend, or the Restricted Securities Legend shall
not be removed, as the case may be, unless there is delivered to the Trust and
the Property Trustee such satisfactory evidence, which shall include an Opinion
of Counsel, as may be reasonably required by the Trust and the Property Trustee,
that neither the Restricted Securities Legend nor the restrictions on transfer
set forth therein are required to ensure that transfers thereof are made
pursuant to an exception from the registration requirements of the Securities
Act or, with respect to Restricted Capital Securities, that such Securities are
not "restricted" within the meaning of Rule 144. Upon provision of such satisfac
tory evidence, the Property Trustee, at the written direction of an
Administrative Trustee on behalf of the Trust, shall authenticate and deliver
Capital Securities that do not bear the legend.
(b) Transfers After Effectiveness of a Registration
Statement. After the effectiveness of a Registration Statement with respect to
any Capital Securities, all requirements pertaining to legends on such Capital
Securities will cease to apply (other than the legend requiring that transfers
of Capital Securities be made in blocks having an aggregate liquidation amount
of not less than $100,000), and beneficial interests in the Global Capital
Security without legends will be
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available to transferees of such Capital Securities, upon exchange of the
transferring Holder's Restricted Definitive Capital Security or directions to
transfer such Holder's beneficial interest in the Global Capital Security, as
the case may be. No such transfer or exchange of a Restricted Definitive Capital
Security or of an interest in the Global Capital Security shall be effective
unless the transferor delivers to the Property Trustee a certificate in a form
substantially similar to that attached hereto as the form of "Assignment" in
Exhibit A-1. Except as otherwise provided in Section 9.2(m), after the
effectiveness of a Registration Statement, an Administrative Trustee on behalf
of the Trust shall issue and the Property Trustee, upon a written order of the
Trust signed by one Administrative Trustee, shall authenticate a Global Capital
Security without the Restricted Securities Legend (the "Unrestricted Global
Capital Security") to deposit with the Clearing Agency to evidence transfers of
beneficial interests from the (i) Global Capital Security and (ii) Restricted
Definitive Capital Securities.
(c) Transfer and Exchange of Definitive Capital
Securities. When Definitive Capital Securities are presented to the Registrar or
co-registrar:
(x) to register the transfer of such Definitive Capital
Securities; or
(y) to exchange such Definitive Capital Securities which
became mutilated, destroyed, defaced, stolen or lost, for an equal
number of Definitive Capital Securities, the Registrar or co-registrar
shall register the transfer or make the exchange as requested if its
reasonable requirements for such transaction are met; provided,
however, that the Definitive Capital Securities surrendered for
registration of transfer or exchange:
(i) shall be duly endorsed or accompanied by a
written instrument of transfer in form reasonably
satisfactory to the Trust and the Registrar or
co-registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing; and
(ii) in the case of Definitive Capital Securities
that are Restricted Definitive Capital Securities:
1. if such Restricted Capital Securities are being
delivered to the Registrar by a Holder for
registration in the name of such Holder, without
transfer, certification(s) from such Holder to that
effect; or
2. if such Restricted Capital Securities are being
transferred: (i) certification(s) in a form
substantially similar to that attached hereto as
the form of "Assignment" in Exhibit A-1, and (ii)
if the Trust or Registrar so requests, evidence
reasonably satisfactory to them as to the
compliance with the restrictions set forth in the
Restricted Securities Legend.
(d) Restrictions on Transfer of a Definitive Capital
Security for a Beneficial Interest in the Global Capital Security. A Definitive
Capital Security may not be exchanged for a beneficial interest in the Global
Capital Security except upon satisfaction of the requirements set forth below.
Upon receipt by the Property Trustee of a Definitive Capital Security, duly
endorsed
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or accompanied by appropriate instruments of transfer, in form satisfactory to
the Property Trustee, together with:
(i) if such Definitive Capital Security is a
Restricted Capital Security, certification(s) in a form
substantially similar to that attached hereto as the form
of "Assignment" in Exhibit A-1; and
(ii) whether or not such Definitive Capital
Security is a Restricted Capital Security, written
instructions directing the Property Trustee to make, or to
direct the Clearing Agency to make, an adjustment on its
books and records with respect to the Global Capital
Security to reflect an increase in the number of the
Capital Securities represented by such Global Capital
Security,
then the Property Trustee shall cancel such Definitive Capital Security and
cause, or direct the Clearing Agency to cause, the aggregate number of Capital
Securities represented by the Global Capital Security to be increased
accordingly. If the Global Capital Security is not then outstanding, an
Administrative Trustee on behalf of the Trust shall issue and the Property
Trustee shall authenticate, upon written order of any Administrative Trustee, a
new Global Capital Security representing an appropriate number of Capital
Securities.
(e) Transfer and Exchange of the Global Capital Security.
Subject to Section 9.2(f), the transfer and exchange of Global Capital Security
or beneficial interests therein shall be effected through the Clearing Agency in
accordance with this Declaration (including applicable restrictions on transfer
set forth herein, if any) and the procedures of the Clearing Agency therefor.
(f) Transfer of a Beneficial Interest in the Global
Capital Security for a Definitive Capital Security.
(i) Any Person having a beneficial interest in the
Global Capital Security may upon request, but only upon 20
days prior notice to the Property Trustee, and if
accompanied by the information specified below, exchange
such beneficial interest for a Definitive Capital Security
representing the same number of Capital Securities. Upon
receipt by the Property Trustee from the Clearing Agency
or its nominee on behalf of any Person having a beneficial
interest in the Global Capital Security of written
instructions or such other form of instructions as is
customary for the Clearing Agency or the Person designated
by the Clearing Agency as having such a beneficial
interest in a Restricted Capital Security and
certification(s) from the transferor in a form
substantially similar to that attached hereto as the form
of "Assignment" in Exhibit A-1, which may be submitted by
facsimile, then the Property Trustee will cause the
aggregate number of Capital Securities represented by the
Global Capital Security to be reduced on its books and
records and, following such reduction, the Trust will
execute and the Property Trustee will authenticate and
make available for delivery to the transferee a Definitive
Capital Security.
(ii) Definitive Capital Securities issued in
exchange for a beneficial interest in the Global Capital
Security pursuant to this Section 9.2(f) shall be
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registered in such names and in such authorized
denominations as the Clearing Agency, pursuant to
instructions from its Clearing Agency Participants or
indirect participants or otherwise, shall instruct the
Property Trustee in writing-. The Property Trustee shall
deliver such Capital Securities to the Persons in whose
names such Capital Securities are so registered in
accordance with such instructions of the Clearing Agency.
(g) Restrictions on Transfer and Exchange of the Global
Capital Security. Notwithstanding any other provisions of this Declaration
(other than the provisions set forth in subsection (h) of this Section 9.2), the
Global Capital Security may not be transferred as a whole except by the Clearing
Agency to a nominee of the Clearing Agency or another nominee of the Clearing
Agency or by the Clearing Agency or any such nominee to a successor Clearing
Agency or a nominee of such successor Clearing Agency.
(h) Authentication of Definitive Capital Securities. If at
any time:
(i) a Default or an Event of Default has
occurred and is continuing,
(ii) the Trust, in its sole discretion, notifies
the Property Trustee in writing that it elects to cause
the issuance of Definitive Capital Securities under this
Declaration, or
(iii) the Clearing Agency notifies the Sponsor that
it is unwilling or unable to continue as Clearing Agency
for such Global Capital Security or if at any time such
Clearing Agency ceases to be a "clearing agency"
registered under the Exchange Act, and, in each case, a
clearing agency is not appointed by the Sponsor within 90
days of receipt of such notice or of becoming aware of
such condition,
then an Administrative Trustee on behalf of the Trust will execute, and the
Property Trustee, upon receipt of a written order of the Trust signed by one
Administrative Trustee requesting the authentication and delivery of Definitive
Capital Securities to the Persons designated by the Trust, will authenticate and
make available for delivery Definitive Capital Securities, equal in number to
the number of Capital Securities represented by the Global Capital Security, in
exchange for such Global Capital Security.
(i) Legend.
(i) Except as permitted by the following paragraph
(ii), each Capital Security Certificate evidencing the
Global Capital Security and each Definitive Capital
Security (and all Capital Securities issued in exchange
therefor or substitution thereof) shall bear a legend (the
"Restricted Securities Legend") in substantially the
following form:
THIS CAPITAL SECURITY HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR ANY
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STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES
LAW. NEITHER THIS CAPITAL SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF
IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE
HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS
CAPITAL SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER
THE LATER OF THE ORIGINAL ISSUANCE DATE HEREOF AND THE
LAST DATE ON WHICH RELIANCE BANCORP, INC. (THE
"CORPORATION") OR ANY "AFFILIATE" OF THE CORPORATION WAS
THE OWNER OF THIS CAPITAL SECURITY (OR ANY PREDECESSOR OF
THIS CAPITAL SECURITY) ONLY (A) TO THE CORPORATION, (B)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) SO LONG
AS THIS CAPITAL SECURITY IS ELIGIBLE FOR RESALE PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) 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)
TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE
MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE
501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS
CAPITAL SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT
OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER
OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION
OF THE SECURITIES ACT OR (E) PURSUANT TO ANY OTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
UNDER THE SECURITIES ACT, SUBJECT TO THE RIGHT OF RELIANCE
CAPITAL
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TRUST I (THE "TRUST") AND THE CORPORATION PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) OR
(E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM, AND (ii) PURSUANT TO CLAUSE (D) TO REQUIRE
THAT THE TRANSFEROR DELIVER TO THE TRUST A LETTER FROM THE
TRANSFEREE SUBSTANTIALLY IN THE FORM OF ANNEX A TO THE
OFFERING MEMORANDUM DATED APRIL 23, 1998. SUCH HOLDER
FURTHER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM
THIS CAPITAL SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE
HEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT
AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR
OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED, (THE "CODE") (EACH A "PLAN"), OR
AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY AND NO
PERSON INVESTING "PLAN ASSETS" OF ANY PLAN MAY ACQUIRE OR
HOLD THE CAPITAL SECURITIES OR ANY INTEREST THEREIN,
UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE
EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR
PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60,
91-38, 90-1 OR 84-14 WITH RESPECT TO SUCH PURCHASE OR
HOLDING. ANY PURCHASE OR HOLDER OF THE CAPITAL SECURITIES
OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED
BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT IS
NOT A PLAN OR PLAN ASSET ENTITY OR (ii) THE ACQUISITION
AND HOLDING OF THIS CAPITAL SECURITY BY IT IS NOT
PROHIBITED BY EITHER SECTION 406 OF ERISA OR SECTION 4975
OF THE CODE OR IS EXEMPT FROM ANY SUCH PROHIBITION.
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In all circumstances, each Capital Security Certificate shall bear the following
legend:
THE CAPITAL SECURITIES WILL BE ISSUED AND MAY BE
TRANSFERRED ONLY IN BLOCKS HAVING A LIQUIDATION AMOUNT OF
NOT LESS THAN $100,000 (100 CAPITAL SECURITIES) AND
MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED
TRANSFER OF CAPITAL SECURITIES IN A BLOCK HAVING A
LIQUIDATION AMOUNT OF LESS THAN $100,000 SHALL BE DEEMED
TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH
PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER
OF SUCH CAPITAL SECURITIES FOR ANY PURPOSE, INCLUDING, BUT
NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON SUCH
CAPITAL SECURITIES, AND SUCH PURPORTED TRANSFEREE SHALL BE
DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH CAPITAL
SECURITIES.
(ii) Upon any sale or transfer of a Restricted
Capital Security (including any Restricted Capital
Security represented by the Global Capital Security)
pursuant to an effective registration statement under the
Securities Act or pursuant to Rule 144:
1. in the case of any Restricted Capital Security
that is a Definitive Capital Security, the
Registrar shall permit the Holder thereof to
exchange such Restricted Capital Security for a
Definitive Capital Security that does not bear the
Restricted Securities Legend and rescind any
restriction on the transfer of such Restricted
Capital Security; and
2. in the case of any Restricted Capital Security
that is represented by the Global Capital Security,
the Registrar shall permit the Holder of such
Global Capital Security to exchange such Global
Capital Security for another Global Capital
Security that does not bear the Restricted
Securities Legend.
(j) Cancellation or Adjustment of Global Capital Security.
At such time as all beneficial interests in the Global Capital Security have
either been exchanged for Definitive Capital Securities to the extent permitted
by this Declaration or redeemed, repurchased or canceled in accordance with the
terms of this Declaration, such Global Capital Security shall be returned to the
Clearing Agency for cancellation or retained and canceled by the Property
Trustee. At any time prior to such cancellation, if any beneficial interest in
the Global Capital Security is exchanged for Definitive Capital Securities,
Capital Securities represented by such Global Capital Security shall be reduced
and an adjustment shall be made on the books and records of the Property Trustee
and the Clearing Agency or its nominee to reflect such reduction.
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(k) Obligations with Respect to Transfers and Exchanges of
Capital Securities.
(i) To permit registrations of transfers and
exchanges, the Trust shall execute and the Property
Trustee shall authenticate Definitive Capital Securities
and the Global Capital Security at the Registrar's or
co-registrar's request in accordance with the terms of
this Declaration.
(ii) Registrations of transfers or exchanges will
be effected without charge, but only upon payment (with
such indemnity as the Trust or the Sponsor may require) in
respect of any tax or other governmental charge that may
be imposed in relation to it.
(iii) The Registrar or co-registrar shall not be
required to register the transfer of or exchange of (a)
Capital Securities during a period beginning at the
opening of business 15 days before the day of mailing of a
notice of redemption or any notice of selection of Capital
Securities for redemption and ending at the close of
business on the day of such mailing or (b) any Capital
Security so selected for redemption in whole or in part,
except the unredeemed portion of any Capital Security
being redeemed in part.
(iv) Prior to the due presentation for registration
of transfer of any Capital Security, the Trust, the
Property Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the Person in whose name a
Capital Security is registered as the absolute owner of
such Capital Security for the purpose of receiving
Distributions on such Capital Security and for all other
purposes whatsoever, and none of the Trust, the Property
Trustee, the Paying Agent, the Registrar or any
co-registrar shall be affected by notice to the contrary.
(v) All Capital Securities issued upon any
registration of transfer or exchange pursuant to the terms
of this Declaration shall evidence the same security and
shall be entitled to the same benefits under this
Declaration as the Capital Securities surrendered upon
such registration of transfer or exchange.
(l) No Obligation of the Property Trustee.
(i) The Property Trustee shall have no
responsibility or obligation to any beneficial owner of
the Global Capital Security, a Participant in the Clearing
Agency or other Person with respect to the accuracy of the
records of the Clearing Agency or its nominee or of any
Participant thereof, with respect to any ownership
interest in the Capital Securities or with respect to the
delivery to any Participant, beneficial owner or other
Person (other than the Clearing Agency) of any notice
(including any notice of redemption) or the payment of any
amount, under or with respect to such Capital Securities.
All notices and communications to be given to the Holders
and all payments to be made to Holders under the Capital
Securities shall be given or made only to or upon the
order of the registered Holders (which shall be the
Clearing Agency or its nominee in the case of the Global
Capital Security). The rights of beneficial owners in the
Global Capital Security shall be exercised only through
the Clearing Agency subject to
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the applicable rules and procedures of the Clearing
Agency. The Property Trustee may conclusively rely and
shall be fully protected in relying upon information
furnished by the Clearing Agency or any agent thereof with
respect to its Participants and any beneficial owners.
(ii) The Property Trustee and the Registrar shall
have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer
imposed under this Declaration or under applicable law
with respect to any transfer of any interest in any
Capital Security (including any transfers between or among
Clearing Agency Participants or beneficial owners in the
Global Capital Security) other than to require delivery of
such certificates and other documentation or evidence as
are expressly required by, and to do so if and when
expressly required by, the terms of this Declaration, and
to examine the same to determine substantial compliance as
to form with the express requirements hereof.
(m) Exchange of Series A Capital Securities for Series B
Capital Securities. The Series A Capital Securities shall be exchanged for
Series B Capital Securities pursuant to the terms of the Exchange Offer if the
following conditions are satisfied:
The Sponsor shall present the Property Trustee with an
Officers' Certificate certifying the following:
1. upon issuance of the Series B Capital
Securities, the transactions contemplated by the
Exchange Offer have been consummated; and
2. the number of Series A Capital Securities
properly tendered in the Exchange Offer that are
represented by the Global Capital Security and the
number of Series A Capital Securities properly
tendered in the Exchange Offer that are represented
by Definitive Capital Securities, the name of each
Holder of such Definitive Capital Securities, the
liquidation amount of Capital Securities properly
tendered in the Exchange Offer by each such Holder
and the name and address to which Definitive
Capital Securities for Series B Capital Securities
shall be registered and sent for each such Holder.
The Property Trustee, upon receipt of (i) such Officers'
Certificate, (ii) an Opinion of Counsel (x) to the effect that the Series B
Capital Securities and the Series B Capital Securities Guarantee have been
registered under Section 5 of the Securities Act and that this Declaration and
the Series B Capital Securities Guarantee have been qualified under the Trust
Indenture Act and (y) with respect to the matters set forth in Section 3(p) of
the Registration Rights Agreement, shall authenticate (A) the Global Capital
Security, executed and delivered by the Trust to the Property Trustee, for
Series B Capital Securities in aggregate liquidation amount equal to the
aggregate liquidation amount of Series A Capital Securities represented by the
Global Capital Security indicated in such Officers' Certificate as having been
properly tendered and (B) Definitive Capital Securities, executed and delivered
by the Trust to the Property Trustee, representing Series B Capital
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Securities registered in the names and in the liquidation amounts indicated in
such Officers' Certificate.
If, upon consummation of the Exchange Offer, less than all
the outstanding Series A Capital Securities shall have been properly tendered
and not withdrawn, the Property Trustee shall make an endorsement on the Global
Capital Security for Series A Capital Securities indicating the reduction in the
number and aggregate liquidation amount represented thereby as a result of the
Exchange Offer.
The Trust shall deliver such authenticated Definitive
Capital Securities for Series B Capital Securities to the Holders thereof as
indicated in such Officers' Certificate.
(n) Minimum Transfers. Series A Capital Securities and, if
and when issued, Series B Capital Securities may only be transferred in minimum
blocks of $100,000 aggregate liquidation amount. Any attempted transfer of
Series A Capital Securities or Series B Capital Securities in a block having an
aggregate liquidation amount of less than $100,000 shall be deemed to be voided
and of no legal effect whatsoever. Any such purported transferee shall be deemed
not to be a Holder of such Series A Capital Securities or Series B Capital
Securities for any purpose, including, but not limited to, the receipt of
Distributions on such Capital Securities, and such purported transferee shall be
deemed to have no interest whatsoever in such Capital Securities.
SECTION 9.3 DEEMED SECURITY HOLDERS.
The Trustees may treat the Person in whose name any
Security shall be registered on the books and records of the Trust as the sole
owner and Holder of such Security for purposes of receiving Distributions and
for all other purposes whatsoever and, accordingly, shall not be bound to
recognize any equitable or other claim to or interest in such Security on the
part of any Person, whether or not the Trust shall have actual or other notice
thereof.
SECTION 9.4 BOOK-ENTRY INTERESTS.
The Global Capital Security shall initially be registered
on the books and records of the Trust in the name of Cede & Co., the nominee of
the Clearing Agency and no Capital Security Beneficial Owner will receive
physical delivery of a definitive Capital Security certificate (a "Capital
Security Certificate") representing such Capital Security Beneficial Owner's
interests in such Global Capital Security, except as provided in Section 9.2 and
Section 7.9. Unless and until Definitive Capital Securities have been issued to
the Capital Security Beneficial Owners pursuant to Section 9.2 or Section 7.9:
(a) the provisions of this Section 9.4 shall be in full
force and effect;
(b) the Trust and the Trustees shall be entitled to deal
with the Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Capital Security and receiving approvals,
votes or consents hereunder) as the sole Holder of the Global Capital Security
and shall have no obligation to the Capital Security Beneficial Owners;
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(c) to the extent that the provisions of this Section 9.4
conflict with any other provisions of this Declaration, the provisions of this
Section 9.4 shall control; and
(d) the rights of the Capital Security Beneficial Owners
shall be exercised only through the Clearing Agency and shall be limited to
those established by law and agreements between such Capital Security Beneficial
Owners and the Clearing Agency and/or the Clearing Agency Participants, and the
Clearing Agency shall receive and transmit payments of Distributions on the
Global Capital Security to such Clearing Agency Participants; provided, however,
that solely for the purposes of determining whether the Holders of the requisite
amount of Capital Securities have voted on any matter provided for in this
Declaration, the Trustees, with respect to the Global Capital Security, may
conclusively rely on, and shall be protected in relying on, any written
instrument (including a proxy) delivered to the Trustees by the Clearing Agency
setting forth the Capital Security Beneficial Owners' votes or assigning the
right to vote on any matter to any other Persons either in whole or in part; and
the Clearing Agency will also make book-entry transfers among the Clearing
Agency Participants.
SECTION 9.5 NOTICES TO CLEARING AGENCY.
Whenever a notice or other communication to the Capital
Security Holders is required to be given by a Trustee under this Declaration,
such Trustee shall give all such notices and communications specified herein to
be given to the Holder of the Global Capital Security to the Clearing Agency and
shall have no notice obligations to the Capital Security Beneficial Owners.
SECTION 9.6 APPOINTMENT OF SUCCESSOR CLEARING AGENCY.
If any Clearing Agency elects to discontinue its services
as securities depositary with respect to the Capital Securities, the
Administrative Trustees may, in their sole discretion, appoint a successor
Clearing Agency with respect to such Capital Securities.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 LIABILITY.
(a) Except as expressly set forth in this Declaration, the
Securities Guarantees and the terms of the Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion
of the capital contributions (or any return thereon) of
the Holders which shall be made solely from assets of the
Trust; and
(ii) required to pay to the Trust or to any Holder
any deficit upon dissolution of the Trust or otherwise.
(b) The Sponsor shall be liable for all of the debts and
obligations of the Trust (other than in respect of the Securities) to the extent
not satisfied out of the Trust's assets.
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(c) Pursuant to ss. 3803(a) of the Business Trust Act, the
Holders shall be entitled to the same limitation of personal liability extended
to stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.
SECTION 10.2 EXCULPATION.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's gross negligence (or in
the case of the Property Trustee or the Delaware Trustee, negligence) or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in
relying in good faith upon the records of the Trust and upon such information,
opinions, reports or statements presented to the Trust by any Person as to
matters the Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the as sets, liabilities,
profits, losses, or any other facts pertinent to the existence and amount of
assets from which Distributions to Holders might properly be paid.
SECTION 10.3 FIDUCIARY DUTY.
(a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this Declaration shall not be liable to the Trust or to any
other Covered Person for its good faith reliance on the provisions of this
Declaration. The provisions of this Declaration, to the extent that they
restrict the duties and liabilities of an Indemnified Person otherwise existing
at law or in equity (other than the duties imposed on the Property Trustee under
the Trust Indenture Act), are agreed by the parties hereto to replace such other
duties and liabilities of such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or
arises between any Covered Person and any Indemnified
Person, or
(ii) whenever this Declaration or any other
agreement contemplated herein or therein provides that an
Indemnified Person shall act in a manner that is, or
provides terms that are, fair and reasonable to the Trust
or any Holder of Securities,
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the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is
permitted or required to make a decision:
(i) in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to
consider such interests and factors as it desires,
including its own interests, and shall have no duty or
obligation to give any consideration to any interest of or
factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such
express standard and shall not be subject to any other or
different standard imposed by this Declaration or by
applicable law.
SECTION 10.4 INDEMNIFICATION.
(a) (i) The Sponsor shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Trust) by reason of the fact
that he is or was a Company Indemnified Person, against expenses (including
attorneys' fees and expenses), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Trust, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of NOLO CONTENDERE or
its equivalent, shall not, of itself, create a presumption that the Company
Indemnified Person did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Trust, and, with
respect to any criminal action or proceeding, had reasonable cause to believe
that his conduct was unlawful.
(ii) The Sponsor shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified Person against
expenses (including attorneys' fees and expenses) actually and reasonably
incurred by him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the Trust and except that no such
indemnification shall be made in respect of any claim, issue or matter as to
which such Company
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Indemnified Person shall have been adjudged to be liable to the Trust unless and
only to the extent that the Court of Chancery of Delaware or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
such Person is fairly and reasonably entitled to indemnity for such expenses
which such Court of Chancery or such other court shall deem proper.
(iii) To the extent that a Company Indemnified Person
shall be successful on the merits or otherwise (including dismissal of an action
without prejudice or the settlement of an action without admission of liability)
in defense of any action, suit or proceeding referred to in paragraphs (i) and
(ii) of this Section 10.4(a), or in defense of any claim, issue or matter
therein, he shall be indemnified, to the full extent permitted by law, against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
(iv) Any indemnification under paragraphs (i) and (ii) of
this Section 10.4(a) (unless ordered by a court) shall be made by the Sponsor
only as authorized in the specific case upon a determination that
indemnification of the Company Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set forth in paragraphs
(i) and (ii). Such determination shall be made (1) by the Administrative
Trustees by a majority vote of a Quorum consisting of such Administrative
Trustees who were not parties to such action, suit or proceeding, (2) if such a
Quorum is not obtainable, or, even if obtainable, if a Quorum of disinterested
Administrative Trustees so directs, by independent legal counsel in a written
opinion, or (3) by the Common Security Holder of the Trust.
(v) Expenses (including attorneys' fees and expenses)
incurred by a Company Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 10.4(a) shall be paid by the Sponsor in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such Company Indemnified Person to repay
such amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Sponsor as authorized in this Section 10.4(a).
Notwithstanding the foregoing, no advance shall be made by the Sponsor if a
determination is reasonably and promptly made (i) by the Administrative Trustees
by a majority vote of a Quorum of disinterested Administrative Trustees, (ii) if
such a Quorum is not obtainable, or, even if obtainable, if a Quorum of
disinterested Administrative Trustees so directs, by independent legal counsel
in a written opinion or (iii) by the Common Security Holder of the Trust, that,
based upon the facts known to the Administrative Trustees, counsel or the Common
Security Holder at the time such determination is made, such Company Indemnified
Person acted in bad faith or in a manner that the Common Security Holder did not
believe to be in or not opposed to the best interests of the Trust, or, with
respect to any criminal proceeding, that such Company Indemnified Person
believed or had reasonable cause to believe his conduct was unlawful. In no
event shall any advance be made in instances where the Administrative Trustees,
independent legal counsel or Common Security Holder reasonably determine that a
Company Indemnified Person deliberately breached his duty to the Trust or its
Common or Capital Security Holders.
(vi) The indemnification and advancement of expenses
provided by, or granted pursuant to, the other paragraphs of this Section
10.4(a) shall not be deemed exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled under any agreement,
vote of stockholders or disinterested directors of the Sponsor or
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Capital Security Holders of the Trust or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office. All rights to indemnification under this Section 10.4(a) shall be deemed
to be provided by a contract between the Sponsor and each Company Indemnified
Person who serves in such capacity at any time while this Section 10.4(a) is in
effect. Any repeal or modification of this Section 10.4(a) shall not affect any
rights or obligations then existing.
(vii) The Sponsor or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company Indemnified Person
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the Debenture
Issuer would have the power to indemnify him against such liability under the
provisions of this Section 10.4(a).
(viii) For purposes of this Section 10.4(a), references to
"the Trust" shall include, in addition to the resulting or surviving entity, any
constituent entity (including any constituent of a constituent) absorbed in a
consolidation or merger, so that any person who is or was a director, trustee,
officer or employee of such constituent entity, or is or was serving at the
request of such constituent entity as a director, trustee, officer, employee or
agent of another entity, shall stand in the same position under the provisions
of this Section 10.4(a) with respect to the resulting or surviving entity as he
would have with respect to such constituent entity if its separate existence had
continued.
(ix) The indemnification and advancement of expenses
provided by, or granted pursuant to, this Section 10.4(a) shall, unless
otherwise provided when authorized or ratified, continue as to a Person who has
ceased to be a Company Indemnified Person and shall inure to the benefit of the
heirs, executors and administrators of such a Person.
(b) The Sponsor agrees to indemnify the (i) Property
Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the Property Trustee
or the Delaware Trustee, and (iv) any officers, directors, shareholders,
members, partners, employees, representatives, custodians, nominees or agents of
the Property Trustee or the Delaware Trustee (each of the Persons in (i) through
(iv), including the Property Trustee and the Delaware Trustee in their
respective individual capacities, being referred to as a "Fiduciary Indemnified
Person") for, and to hold each Fiduciary Indemnified Person harmless against,
any and all loss, liability, damage, claim or expense including taxes (other
than taxes based on the income of such Fiduciary Indemnified Person) incurred
without negligence or bad faith on the part of such Fiduciary Indemnified
Person, arising out of or in connection with the acceptance or administration of
the trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending against or investigating any
claim or liability in connection with the exercise or performance of any of the
powers or duties of such Fiduciary Indemnified Person hereunder. The obligation
to indemnify as set forth in this Section 10.4(b) shall survive the resignation
or removal of the Property Trustee or the Delaware Trustee and the satisfaction
and discharge of this Declaration.
(c) The Sponsor agrees to pay the Property Trustee and the
Delaware Trustee, from time to time, such compensation for all services rendered
by the Property Trustee and the Dela ware Trustee hereunder as may be mutually
agreed upon in writing by the Sponsor and the Property Trustee or the Delaware
Trustee, as the case may be, and, except as otherwise expressly provided
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herein, to reimburse the Property Trustee and the Delaware Trustee upon its or
their request for all reasonable expenses (including counsel fees and expenses),
disbursements and advances incurred or made by the Property Trustee or the
Delaware Trustee, as the case may be, in accordance with the provisions of this
Declaration, except any such expense, disbursement or advance as may be
attributable to its or their negligence or bad faith.
SECTION 10.5 OUTSIDE BUSINESSES.
Any Covered Person, the Sponsor, the Delaware Trustee and
the Property Trustee (subject to Section 5.3(c)) may engage in or possess an
interest in other business ventures of any nature or description, independently
or with others, similar or dissimilar to the business of the Trust, and the
Trust and the Holders shall have no rights by virtue of this Declaration in and
to such independent ventures or the income or profits derived therefrom, and the
pursuit of any such venture, even if competitive with the business of the Trust,
shall not be deemed wrongful or improper. No Covered Person, the Sponsor, the
Delaware Trustee, or the Property Trustee shall be obligated to present any
particular investment or other opportunity to the Trust even if such opportunity
is of a character that, if presented to the Trust, could be taken by the Trust,
and any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee shall have the right to take for its own account (individually or as a
partner or fiduciary) or to recommend to others any such particular investment
or other opportunity. Any Covered Person, the Delaware Trustee and the Property
Trustee may engage or be interested in any financial or other transaction with
the Sponsor or any Affiliate of the Sponsor, or may act as depositary for,
trustee or agent for, or act on any committee or body of holders of, securities
or other obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 FISCAL YEAR.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year, or such other year as is required by the Code.
SECTION 11.2 CERTAIN ACCOUNTING MATTERS.
(a) At all times during the existence of the Trust, the
Administrative Trustees shall keep, or cause to be kept, full books of account,
records and supporting documents, which shall reflect in reasonable detail each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting
principles, consistently applied. The Trust shall use the accrual method of
accounting for United States federal income tax purposes. The books of account
and the records of the Trust shall be examined by and reported upon as of the
end of each Fiscal Year of the Trust by a firm of independent certified public
accountants selected by the Administrative Trustees.
(b) The Administrative Trustees shall cause to be duly
prepared and delivered to each of the Holders any annual United States federal
income tax information statement required by the Code, containing such
information with regard to the Securities held by each Holder as is required by
the Code and the Treasury Regulations. Notwithstanding any right under the Code
to
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deliver any such statement at a later date, the Administrative Trustees shall
endeavor to deliver all such information statements within 30 days after the end
of each Fiscal Year of the Trust.
(c) The Administrative Trustees shall cause to be duly
prepared and filed with the appropriate taxing authority, an annual United
States federal income tax return, on a Form 1041 or such other form required by
United States federal income tax law, and any other annual income tax returns
required to be filed by the Administrative Trustees on behalf of the Trust with
any state or local taxing authority.
SECTION 11.3 BANKING.
The Trust may maintain one or more bank accounts in the
name and for the sole benefit of the Trust; PROVIDED, HOWEVER, that all payments
of funds in respect of the Debentures held by the Property Trustee shall be made
directly to the Property Trustee Account and no other funds of the Trust shall
be deposited in the Property Trustee Account. The sole signatories for such
accounts shall be designated by the Administrative Trustees; PROVIDED, HOWEVER,
that the Property Trustee shall designate the signatories for the Property
Trustee Account.
SECTION 11.4 WITHHOLDING.
The Trust and the Administrative Trustees shall comply
with all withholding requirements under United States federal, state and local
law. The Trust shall request, and the Holders shall provide to the Trust, such
forms or certificates as are necessary to establish an exemption from
withholding with respect to each Holder, and any representations and forms as
shall reasonably be requested by the Trust to assist it in determining the
extent of, and in fulfilling, its withholding obligations. The Administrative
Trustees shall cause to be filed required forms with applicable jurisdictions
and, unless an exemption from withholding is properly established by a Holder,
shall remit amounts withheld with respect to the Holder to applicable
jurisdictions. To the extent that the Trust is required to withhold and pay over
any amounts to any authority with respect to Distributions or allocations to any
Holder, the amount withheld shall be deemed to be a Distribution in the amount
of the withholding to the Holder. In the event of any claim of excess
withholding, Holders shall be limited to an action against the applicable
jurisdiction. If the amount required to be withheld was not withheld from actual
Distributions made, the Trust may reduce subsequent Distributions by the amount
of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 AMENDMENTS.
(a) Except as otherwise provided in this Declaration
(including Section 7 of Annex I hereto) or by any applicable terms of the
Securities, this Declaration may only be amended by a written instrument
approved and executed by:
(i) the Sponsor and the Administrative Trustees
(or, if there are more than two Administrative Trustees, a
majority of the Administrative Trustees);
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(ii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Property Trustee,
the Property Trustee; and
(iii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware Trustee,
the Delaware Trustee.
(b) No amendment shall be made, and any such purported
amendment shall be void and ineffective:
(i) unless, in the case of any proposed amendment,
the Property Trustee shall have first received an
Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms
to, the terms of this Declaration (including the terms of
the Securities);
(ii) unless, in the case of any proposed amendment
which affects the rights, powers, duties, obligations or
immunities of the Property Trustee, the Property Trustee
shall have first received:
1. an Officers' Certificate from each of the Trust
and the Sponsor that such amendment is permitted
by, and conforms to, the terms of this Declaration
(including the terms of the Securities); and
2. an Opinion of Counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is
permitted by, and conforms to, the terms of this
Declaration (including the terms of the Securities)
and that all conditions precedent to the execution
and delivery of such amendment have been satisfied;
PROVIDED, HOWEVER, that the Property Trustee shall not be required to sign any
such amendment; and
(iii) to the extent the result of such amendment
would be to:
1. cause the Trust to fail to continue to be
classified for purposes of United States federal
income taxation as a grantor trust;
2. reduce or otherwise adversely affect the powers
of the Property Trustee in contravention of the
Trust Indenture Act; or
3. cause the Trust to be deemed to be an Investment
Company required to be registered under the
Investment Company Act.
(c) At such time after the Trust has issued any Securities
that remain outstanding, any amendment that would adversely affect the rights,
privileges or preferences of any Holder (other than an amendment pursuant to
(g)(ii) below) may be effected only with such additional requirements as may be
set forth in the terms of such Securities;
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(d) Section 10.1(c) and this Section 12.1 shall not be
amended without the consent of all of the Holders;
(e) Article Four shall not be amended without the consent
of the Holders of a Majority in Liquidation Amount of the Common Securities;
(f) The rights of the Holders of the Common Securities
under Article V to increase or decrease the number of, and appoint and remove
Trustees shall not be amended without the consent of the Holders of a Majority
in Liquidation Amount of the Common Securities; and
(g) Notwithstanding Section 12.1(c), this Declaration may
be amended without the consent of the Holders to:
(i) cure any ambiguity, correct or supplement any
provision in this Declaration that may be inconsistent
with any other provision of this Declaration or to make
any other provisions with respect to matters or questions
arising under this Declaration which shall not be
inconsistent with the other provisions of the Declaration;
(ii) to modify, eliminate or add to any provisions
of the Declaration to such extent as shall be necessary to
ensure that the Trust will be classified for United States
federal income tax purposes as a grantor trust at all
times that any Securities are outstanding or to ensure
that the Trust will not be required to register as an
Investment Company under the Investment Company Act; and
(iii) to modify, eliminate or add any provisions of
the Declaration to such extent as shall be necessary to
enable the Trust or the Sponsor to conduct an Exchange
Offer in the manner contemplated by the Registration
Rights Agreement;
provided, however, that in the case of clauses (i) and (iii) above, such action
shall not adversely affect in any material respect the interests of the Holders,
and any such amendments of this Declaration shall become effective when notice
thereof is given to the Holders.
SECTION 12.2 MEETINGS OF THE HOLDERS; ACTION BY WRITTEN CONSENT.
(a) Meetings of the Holders of any class of Securities may
be called at any time by the Administrative Trustees (or as provided in the
terms of the Securities) to consider and act on any matter on which Holders of
such class of Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules of any stock exchange on
which the Capital Securities are listed or admitted for trading. The
Administrative Trustees shall call a meeting of the Holders of such class if
directed to do so by the Holders of at least 10% in liquidation amount of such
class of Securities. Such direction shall be given by delivering to the
Administrative Trustees one or more notices in writing stating that the signing
Holders wish to call a meeting and indicating the general or specific purpose
for which the meeting is to be called. Any Holders calling a meeting shall
specify in writing the Capital Security Certificates held by the Holders
exercising the right to
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call a meeting and only those Securities specified shall be counted for purposes
of determining whether the required percentage set forth in the second sentence
of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms
of the Securities, the following provisions shall apply to meetings of Holders:
(i) notice of any such meeting shall be given to
all the Holders having a right to vote thereat at least
seven days and not more than 60 days before the date of
such meeting. Whenever a vote, consent or approval of the
Holders is permitted or required under this Declaration or
the rules of any stock exchange on which the Capital
Securities are listed or admitted for trading, such vote,
consent or approval may be given at a meeting of the
Holders; any action that may be taken at a meeting of the
Holders may be taken without a meeting if a consent in
writing setting forth the action so taken is signed by the
Holders owning not less than the minimum amount of
Securities in liquidation amount that would be necessary
to authorize or take such action at a meeting at which all
Holders having a right to vote thereon were present and
voting; prompt notice of the taking of action without a
meeting shall be given to the Holders entitled to vote who
have not consented in writing; and the Administrative
Trustees may specify that any written ballot submitted to
the Security Holder for the purpose of taking any action
without a meeting shall be returned to the Trust within
the time specified by the Administrative Trustees;
(ii) each Holder may authorize any Person to act
for it by proxy on all matters in which a Holder is
entitled to participate, including waiving notice of any
meeting, or voting or participating at a meeting; no proxy
shall be valid after the expiration of eleven months from
the date thereof unless otherwise provided in the proxy;
every proxy shall be revocable at the pleasure of the
Holder executing it; and, except as otherwise provided
herein, all matters relating to the giving, voting or
validity of proxies shall be governed by the General
Corporation Law of the State of Delaware relating to
proxies, and judicial interpretations thereunder, as if
the Trust were a Delaware corporation and the Holders were
stockholders of a Delaware corporation;
(iii) each meeting of the Holders shall be
conducted by the Administrative Trustees or by such other
Person that the Administrative Trustees may designate; and
(iv) unless the Business Trust Act, this
Declaration, the terms of the Securities, the Trust
Indenture Act or the listing rules of any stock exchange
on which the Capital Securities are then listed or
trading, otherwise provides, the Administrative Trustees,
in their sole discretion, shall establish all other
provisions relating to meetings of Holders, including
notice of the time, place or purpose of any meeting at
which any matter is to be voted on by any Holders, waiver
of any such notice, action by consent without a meeting,
the establishment of a record date, quorum requirements,
voting in person or by proxy or any other matter with
respect to the exercise of any such right to vote.
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ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 REPRESENTATIONS AND WARRANTIES OF PROPERTY TRUSTEE.
The Trustee that acts as initial Property Trustee
represents and warrants to the Trust and to the Sponsor at the date of this
Declaration, and each Successor Property Trustee represents and warrants to the
Trust and the Sponsor at the time of the Successor Property Trustee's acceptance
of its appointment as Property Trustee that:
(a) the Property Trustee is a banking corporation, a
national banking association or a bank or trust company, duly organized, validly
existing and in good standing under the laws of the United States or the State
of New York, as the case may be, with corporate power and authority to execute
and deliver, and to carry out and perform its obligations under the terms of,
this Declaration;
(b) the execution, delivery and performance by the
Property Trustee of this Declaration has been duly authorized by all necessary
corporate action on the part of the Property Trustee; and this Declaration has
been duly executed and delivered by the Property Trustee and under New York law
(excluding any securities laws) constitutes a legal, valid and binding
obligation of the Property Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law);
(c) the execution, delivery and performance of this
Declaration by the Property Trustee does not conflict with or constitute a
breach of the charter or by-laws of the Property Trustee; and
(d) no consent, approval or authorization of, or
registration with or notice to, any federal or Wisconsin banking authority
governing the trust powers of the Property Trustee is required for the
execution, delivery or performance by the Property Trustee of this Declaration.
SECTION 13.2 REPRESENTATIONS AND WARRANTIES OF DELAWARE TRUSTEE.
The Trustee that acts as initial Delaware Trustee
represents and warrants to the Trust and to the Sponsor at the date of this
Declaration, and each Successor Delaware Trustee represents and warrants to the
Trust and the Sponsor at the time of the Successor Delaware Trustee's acceptance
of its appointment as Delaware Trustee that:
(a) the Delaware Trustee is a banking corporation, a
national banking association or a bank or trust company, duly organized, validly
existing and in good standing under the laws of the United States or the State
of Delaware, as the case may be, with corporate power and authority to execute
and deliver, and to carry out and perform its obligations under the terms of,
this Declaration;
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(b) the execution, delivery and performance by the
Delaware Trustee of this Declaration has been duly authorized by all necessary
corporate action on the part of the Delaware Trustee; and this Declaration has
been duly executed and delivered by the Delaware Trustee and under Delaware law
(excluding any securities laws) constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law); .
(c) the execution, delivery and performance of this
Declaration by the Delaware Trustee does not conflict with or constitute a
breach of the charter or by-laws of the Delaware Trustee; and
(d) no consent, approval or authorization of, or
registration with or notice to, any federal or Delaware banking authority
governing the trust powers of the Delaware Trustee is required for the
execution, delivery or performance by the Delaware Trustee of this Declaration;
and
(e) the Delaware Trustee is a natural person who is a
resident of the State of Delaware or, if not a natural person, an entity which
has its principal place of business in the State of Delaware, and is a Person
that satisfies for the Trust Section 3807(a) of the Business Trust Act.
ARTICLE XIV
REGISTRATION RIGHTS
SECTION 14.1 REGISTRATION RIGHTS AGREEMENT; LIQUIDATED DAMAGES.
The Holders of the Series A Capital Securities, the Series
A Debentures and the Series A Capital Securities Guarantee are entitled to the
benefits of the Registration Rights Agreement and the Liquidated Damages
Agreement. In certain limited circumstances set forth in the Registration Rights
Agreement and the Liquidated Damages Agreement, the Debenture Issuer shall be
required to pay liquidated damages with respect to the Debentures. Unless
otherwise stated, the term "Distribution," as used in this Declaration, includes
any and all liquidated damages.
ARTICLE XV
MISCELLANEOUS
SECTION 15.1 NOTICES.
All notices provided for in this Declaration shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by first class mail, overnight courier service or confirmed
telecopy, as follows:
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(a) if given to the Trust, in care of the Administrative
Trustees at the Trust's mailing address set forth below (or such other address
as the Trust may give notice of to the Property Trustee, the Delaware Trustee
and the Holders):
Reliance Capital Trust I
c/o Reliance Bancorp, Inc.
585 Stewart Avenue
Garden City, New York 11530
Telecopier: (516) 222-1805
Telephone: (516) 222-9300
Attention: Administrative Trustee
(b) if given to the Delaware Trustee, at the mailing
address set forth below (or such other address as Delaware Trustee may give
notice of to the Holders):
The Bank of New York (Delaware)
White Clay Center
Route 273
Newark, Delaware 19711
(c) if given to the Property Trustee, at the Property
Trustee's mailing address set forth below (or such other address as the Property
Trustee may give notice of to the Holders):
The Bank of New York
101 Barclay Street - 21 West
New York, New York 10286
Telecopier: (212) 815-5915
Telephone: (212) 815-2588
Attention: Corporate Trust Department
(d) if given to the Holder of the Common Securities, at
the mailing address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice to the Trust):
Reliance Capital Trust I
c/o Reliance Bancorp, Inc.
585 Stewart Avenue
Garden City, New York 11530
Telecopier: (516) 222-1805
Telephone: (516) 222-9300
(e) if given to any other Holder, at the address set forth
on the books and records of the Trust.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a
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notice or other document is refused delivery or cannot be delivered because of a
changed address of which no notice was given, such notice or other document
shall be deemed to have been delivered on the date of such refusal or inability
to deliver.
SECTION 15.2 GOVERNING LAW.
This Declaration and the rights of the parties hereunder
shall be governed by and construed in accordance with the laws of the State of
Delaware without regard to conflict of laws principles thereof.
SECTION 15.3 INTENTION OF THE PARTIES.
It is the intention of the parties hereto that the Trust
be classified for United States federal income tax purposes as a grantor trust.
The provisions of this Declaration shall be interpreted to further this
intention of the parties.
SECTION 15.4 HEADINGS.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
SECTION 15.5 SUCCESSORS AND ASSIGNS.
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be deemed
to be included, and all covenants and agreements in this Declaration by the
Sponsor and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
SECTION 15.6 PARTIAL ENFORCEABILITY.
If any provision of this Declaration, or the application
of such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to Persons
or circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 15.7 COUNTERPARTS.
This Declaration may contain more than one counterpart of
the signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one or more of such counterpart signature
pages. All of such counterpart signature pages shall be read as though one, and
they shall have the same force and effect as though all of the signers had
signed a single signature page.
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IN WITNESS WHEREOF, the undersigned has caused these
presents to be executed as of the day and year first above written.
/s/ Raymond A. Nielsen
--------------------------
Raymond A. Nielsen
as Administrative Trustee
/s/ Gerald M. Sauvigne
--------------------------
Gerald M. Sauvigne
as Administrative Trustee
/s/ Paul D. Hagan
--------------------------
Paul D. Hagan
as Administrative Trustee
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By: /s/ Mary Jane Morrissey
--------------------------
Name: Mary Jane Morrissey
Title: Authorized Signatory
THE BANK OF NEW YORK
as Property Trustee
By: /s/ Iliana Acevedo
--------------------------
Name: Iliana Acevedo
Title: Assistant Treasurer
RELIANCE BANCORP, INC.
as Sponsor and Debenture Issuer
By: /s/ Raymond A. Nielsen
--------------------------
Name: Raymond A. Nielsen
Title: President/Chief Executive Officer
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ANNEX I
TERMS OF
8.17% CAPITAL SECURITIES, SERIES A/SERIES B
8.17% COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated
Declaration of Trust, dated as of April 28, 1998 (as amended from time to time,
the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Securities are set out below
(each capitalized term used but not defined herein has the meaning set forth in
the Declaration or, if not defined in such Declaration, as defined in the
Offering Memorandum referred to below in Section 2(c) of this Annex I):
1. Designation and Number.
(a) Capital Securities. 50,000 Series A Capital Securities of
the Trust and 50,000 Series B Capital Securities of the Trust, each series with
an aggregate liquidation amount with respect to the assets of the Trust of fifty
million dollars ($50,000,000), and each with a liquidation amount with respect
to the assets of the Trust of $1,000 per security, are hereby designated for the
purposes of identification only as "8.17% Capital Securities, Series A" and
"8.17% Capital Securities, Series B", respectively (collectively, the "Capital
Securities"). The certificates evidencing the Capital Securities shall be
substantially in the form of Exhibit A-1 to the Declaration, with such changes
and additions thereto or deletions therefrom as may be required by ordinary
usage, custom or practice or to conform to the rules of any exchange or
quotation system on or in which the Capital Securities are listed, traded or
quoted.
(b) Common Securities. 1,547 Common Securities of the Trust
with an aggregate liquidation amount with respect to the assets of the Trust of
one million five hundred forty-seven thousand dollars ($1,547,000) and a
liquidation amount with respect to the assets of the Trust of $1,000 per
security, are hereby designated for the purposes of identification only as
"8.17% Common Securities" (collectively, the "Common Securities"). The
certificates evidencing the Common Securities shall be substantially in the form
of Exhibit A-2 to the Declaration, with such changes and additions thereto or
deletions therefrom as may be required by ordinary usage, custom or practice.
2. Distributions.
(a) Distributions payable on each Security will be fixed at a
rate per annum of 8.17% (the "Coupon Rate") of the liquidation amount of $1,000
per Security (the "Liquidation Amount"), such rate being the rate of interest
payable on the Debentures to be held by the Property Trustee. Distributions in
arrears for more than one semi-annual period will bear additional Distributions
thereon compounded semi-annually at the Coupon Rate (to the extent permitted by
applicable law). Pursuant to the Registration Rights Agreement, in certain
limited circumstances the Debenture Issuer will be required to pay Liquidated
Damages (as defined in the Registration Rights Agreement) with respect to the
Debentures. The term "Distributions," as used herein, includes distributions of
any and all such interest and Liquidated Damages, if any, payable unless
otherwise stated. A Distribution is payable only to the extent that payments are
made in respect of the
A-1
Debentures held by the Property Trustee and to the extent the Property Trustee
has funds legally available therefor.
(b) Distributions on the Securities will be cumulative, will
accumulate from the most recent date to which Distributions have been paid or,
if no Distributions have been paid, from April 28, 1998 and will be payable
semi-annually in arrears on May 1 and November 1 of each year, commencing
November 1, 1998 (each, a "Distribution Date"), except as otherwise described
below. Distributions will be computed on the basis of a 360-day year consisting
of twelve 30-day months. As long as no Event of Default has occurred and is
continuing under the Indenture, the Debenture Issuer has the right under the
Indenture to defer payments of interest by extending the interest payment period
at any time and from time to time on the Debentures for a period not exceeding
10 consecutive semi-annual periods, including the first such semi-annual period
during such period (each an "Extension Period"), during which Extension Period
no interest shall be due and payable on the Debentures, provided that no
Extension Period shall end on a date other than an Interest Payment Date for the
Debentures or extend beyond the Maturity Date of the Debentures. As a
consequence of such deferral, Distributions will also be deferred.
Notwithstanding such deferral, Distributions will continue to accumulate with
additional Distributions thereon (to the extent permitted by applicable law but
not at a rate greater than the rate at which interest is then accruing on the
Debentures) at the Coupon Rate compounded semi-annually during any such
Extension Period. Prior to the termination of any such Extension Period, the
Debenture Issuer may further defer payments of interest by further extending
such Extension Period, provided that such extension does not cause such
Extension Period, together with all such previous and further extensions within
such Extension Period, to exceed 10 consecutive semi-annual periods, including
the first semi-annual period during such Extension Period, end on a date other
than an Interest Payment Date for the Debentures or extend beyond the Maturity
Date of the Debentures. Upon the termination of any Extension Period and the
payment of all amounts then due, the Debenture Issuer may commence a new
Extension Period, subject to the above requirements.
(c) Distributions on the Securities will be payable to the
Holders thereof as they appear on the books and records of the Trust on the
close of business on the 15th day of the month immediately preceding the month
in which the relevant Distribution Date occurs, which Distribution Dates
correspond to the Interest Payment Dates for the Debentures. Subject to any
applicable laws and regulations and the provisions of the Declaration, each such
payment in respect of the Capital Securities will be made as described under the
heading "Description of Capital Securities -- Form, Denomination, Book-Entry
Procedures and Transfer" in the Offering Memorandum dated April 23, 1998 of the
Debenture Issuer and the Trust relating to the Securities and the Debentures.
The relevant record dates for the Common Securities shall be the same as the
record dates for the Capital Securities. Distributions payable on any Securities
that are not punctually paid on any Distribution Date, as a result of the
Debenture Issuer having failed to make a payment under the Debentures, will
cease to be payable to the Holder on the relevant record date, and such
defaulted Distribution will instead be payable to the Person in whose name such
Securities are registered on the special record date or other specified date
determined in accordance with the Indenture. If any date on which Distributions
are payable on the Securities is not a Business Day, then payment of the
Distributions payable on such date will be made on the next succeeding day that
is a Business Day (and without any interest or other payment in respect of any
such delay), with the same force and effect as if made on such date.
A-2
(d) In the event that there is any money or other property
held by or for the Trust that is not accounted for hereunder, such property
shall be distributed Pro Rata (as defined herein) among the Holders.
3. Liquidation Distribution Upon Dissolution.
In the event of any dissolution of the Trust, the Trust shall
be liquidated by the Administrative Trustees as expeditiously as the
Administrative Trustees determine to be possible by distributing to the Holders,
after satisfaction of liabilities to creditors of the Trust as provided by
applicable law, a Like Amount (as defined below) of the Debentures, unless such
distribution is determined by the Property Trustee not to be practicable, in
which event such Holders will be entitled to receive out of the assets of the
Trust legally available for distribution to Holders, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, an amount
equal to the aggregate of the liquidation amount of $1,000 per Security plus
accumulated and unpaid Distributions thereon to the date of payment (such amount
being the "Liquidation Distribution").
"Like Amount" means (i) with respect to a redemption of the
Securities, Securities having a Liquidation Amount equal to the principal amount
of Debentures to be paid in accordance with their terms and (ii) with respect to
a distribution of Debentures upon the liquidation of the Trust, Debentures
having a principal amount equal to the Liquidation Amount of the Securities of
the Holder to whom such Debentures are distributed.
If, upon any such liquidation, the Liquidation Distribution
can be paid only in part because the Trust has insufficient assets legally
available to pay in full the aggregate Liquidation Distribution, then the
amounts payable directly by the Trust on the Securities shall be paid on a Pro
Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole or in part,
at maturity or otherwise (either at the option of the Debenture Issuer or
pursuant to a Special Event, as described below), the proceeds from such
repayment shall be simultaneously applied by the Property Trustee (subject to
the Property Trustee having received written notice no later than 45 days prior
to such repayment) to redeem a Like Amount of the Securities at a redemption
price equal to (i) in the case of the repayment of the Debentures on the
Maturity Date, the Maturity Redemption Price (as defined below), (ii) in the
case of the optional prepayment of the Debentures prior to the Initial Optional
Redemption Date and upon the occurrence and continuation of a Special Event, the
Special Event Redemption Price (as defined below) and (iii) in the case of the
optional prepayment of the Debentures on or after the Initial Optional
Redemption Date, the Optional Redemption Price (as defined below). The Maturity
Redemption Price, the Special Event Redemption Price and the Optional Redemption
Price are referred to collectively as the "Redemption Price". Holders will be
given not less than 30 nor more than 60 days prior written notice of such
redemption.
(b) (i) The "Maturity Redemption Price," with respect to a
redemption of Securities, shall mean an amount equal to the principal of and
accrued and unpaid interest on the Debentures as of the Maturity Date thereof.
A-3
(ii) In the case of an optional redemption, if fewer than
all the outstanding Securities are to be so redeemed, the Common Securities and
the Capital Securities shall be redeemed PRO RATA and the Capital Securities to
be redeemed will be determined as described in Section 4(f)(ii) below. Upon the
entry of an order for the dissolution of the Trust by a court of competent
jurisdiction, the Debentures thereafter will be subject to optional redemption,
in whole, but not in part, on or after the Initial Optional Redemption Date.
The Debenture Issuer shall have the right (subject to the
conditions in the Indenture) to elect to redeem the Debentures, in whole or in
part, at any time on or after May 1, 2008 (the "Initial Optional Redemption
Date"), and, simultaneous with such redemption, to cause a Like Amount of the
Securities to be redeemed by the Trust at the Optional Redemption Price on a Pro
Rata basis. "Optional Redemption Price" shall mean a price equal to the
percentage of the liquidation amount of Securities to be redeemed plus
accumulated and unpaid Distributions thereon, if any, to the date of such
redemption if redeemed during the 12-month period beginning of May 1, the years
indicated below:
Percentage of
Year Principal
---- ---------
2008 104.085%
2009 103.677%
2010 103.268%
2011 102.860%
2012 102.451%
2013 102.043%
2014 101.634%
2015 101.226%
2016 100.817%
2017 100.409%
2018 and thereafter 100.000%
(c) If at any time a Tax Event or a Regulatory Capital Event
(each as defined below, and each a "Special Event") occurs, the Debenture Issuer
shall have the right (subject to the conditions set forth in the Indenture) at
any time prior to the Initial Optional Redemption Date, to redeem the Debentures
in whole, but not in part, within the 90 days following the occurrence of such
Special Event (the "90 Day Period"), and, simultaneous with such redemption, to
cause a Like Amount of the Securities to be redeemed by the Trust at the Special
Event Redemption Price on a Pro Rata basis.
"Make-Whole Amount" shall mean an amount equal to the greater
of (x) 100% of the principal of Debentures or (y) the sum, as determined by a
Quotation Agent (as defined in the
A-4
Indenture), of the present values of the remaining scheduled payments of
principal and interest on the Debentures, discounted to the redemption date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Adjusted Treasury Rate (as defined in the Indenture), plus, in the case
of each of clauses (x) and (y), accrued and unpaid interest thereon, if any, to
the date of redemption.
A "Tax Event" shall occur upon receipt by the Debenture Issuer
and the Trust of an opinion of counsel experienced in such matters to the effect
that, as a result of any amendment to, or change (including any announced
prospective change) in, the laws or any regulations thereunder of the United
States or any political subdivision or taxing authority thereof or therein, or
as a result of any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement or decision is announced on or after April 28,
1998, there is more than an insubstantial risk that (i) the Trust is, or will be
within 90 days of the date of such opinion, subject to United States federal
income tax with respect to income received or accrued on the Debentures, (ii)
the interest payable by the Debenture Issuer on the Debentures is not, or within
90 days of the date of such opinion will not be, deductible by the Debenture
Issuer, in whole or in part, for United States federal income tax purposes, or
(iii) the Trust is, or will be within 90 days of the date of such opinion,
subject to more than a DE MINIMIS amount of other taxes, duties or other
governmental charges.
"Regulatory Capital Event" shall mean the receipt by the
Debenture Issuer and the Trust of an opinion of independent bank regulatory
counsel experienced in such matters to the effect that as a result of (a) any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any rules,
guidelines or policies of an applicable regulatory authority for the Debenture
Issuer or (b) any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement or decision is announced on or after April 28,
1998, the Capital Securities do not constitute, or within 90 days of the date of
such opinion will not constitute, Tier 1 Capital (or its then equivalent if the
Corporation were subject to such capital requirement) applied as if the
Debenture Issuer (or its successors) were a bank holding company for purposes of
capital adequacy guidelines of the Federal Reserve Board (or any successor
regulatory authority with jurisdiction over bank holding companies), or any
capital adequacy guidelines as then in effect and applicable to the Debenture
Issuer; PROVIDED, HOWEVER, that the distribution of the Debentures in connection
with the liquidation of the Trust by the Debenture Issuer shall not in and of
itself constitute a Regulatory Capital Event unless such liquidation shall have
occurred in connection with a Tax Event.
"Special Event Redemption Price" shall mean, with respect to
any redemption of Securities following a Special Event, an amount in cash equal
to the Make-Whole Amount.
(d) On and from the date fixed by the Administrative Trustees
for any distribution of Debentures and liquidation of the Trust: (i) the
Securities will no longer be deemed to be outstanding, (ii) the Clearing Agency
or its nominee (or any successor Clearing Agency or its nominee), as the Holder
of the Capital Securities, will receive a registered global certificate or
certificates representing the Debentures to be delivered upon such distribution,
and (iii) any certificates representing Securities not held by the Clearing
Agency or its nominee (or any successor Clearing Agency or its nominee) will be
deemed to represent beneficial interests in a Like Amount of
A-5
Debentures until such certificates are presented to the Debenture Issuer or its
agent for transfer or reissue.
(e) The Trust may not redeem fewer than all the outstanding
Securities unless all accumulated and unpaid Distributions have been paid on all
Securities for all semi-annual Distribution periods terminating on or before the
date of redemption.
(f) The procedure with respect to redemptions or distributions
of Securities shall be as follows:
(i) Notice of any redemption of, or notice of distribution of
Debentures in exchange for, the Securities (a "Redemption/Distribution
Notice") will be given by the Trust by mail to each Holder to be
redeemed or exchanged not fewer than 30 nor more than 60 days before
the date fixed for redemption or exchange thereof which, in the case of
a redemption, will be the date fixed for redemption of the Debentures.
For purposes of the calculation of the date of redemption or exchange
and the dates on which notices are given pursuant to this Section
4(f)(i), a Redemption/ Distribution Notice shall be deemed to be given
on the day such notice is first mailed by first-class mail, postage
prepaid, to Holders. Each Redemption/Distribution Notice shall be
addressed to the Holders at the address of each such Holder appearing
in the books and records of the Trust. No defect in the
Redemption/Distribution Notice or in the mailing of either thereof with
respect to any Holder shall affect the validity of the redemption or
exchange proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding
Securities are to be redeemed, the particular Securities to be redeemed
shall be selected on a Pro Rata basis (based upon Liquidation Amounts)
not more than 60 nor less than 30 days prior to the date fixed for
redemption from the outstanding Securities not previously called for
redemption; PROVIDED, HOWEVER, that with respect to Holders that would
be required to hold less than 100 but more than zero Securities as a
result of such redemption, the Trust shall redeem Securities of each
such Holder so that after such redemption such Holder shall hold either
100 Securities or such Holder no longer holds any Securities, and shall
use such method (including, without limitation, by lot) as the Trust
shall deem fair and appropriate; PROVIDED, FURTHER, that any such
redemption may be made on the basis of the aggregate Liquidation Amount
of Securities held by each Holder thereof and may be made by making
such adjustments as the Trust deems fair and appropriate in order that
fractional Securities shall not thereafter remain outstanding. In
respect of Capital Securities registered in the name of and held of
record by the Clearing Agency or its nominee (or any successor Clearing
Agency or its nominee) or any nominee, the distribution of the proceeds
of such redemption will be made to the Clearing Agency and disbursed by
such Clearing Agency in-accordance with the procedures applied by such
agency or nominee.
(iii) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice (which notice will be irrevocable), then
(A) with respect to Capital Securities issued in book-entry form, by
12:00 noon, New York City time, on the redemption date, PROVIDED THAT
the Debenture Issuer has paid the Property Trustee a sufficient amount
of cash in connection with the related redemption or maturity of the
Debentures by 10:00 a.m., New York City time, on the Maturity Date or
the date of
A-6
redemption, as the case requires, the Property Trustee will deposit
irrevocably with the Clearing Agency or its nominee (or successor
Clearing Agency or its nominee) immediately available funds sufficient
to pay the applicable Redemption Price with respect to such Capital
Securities and will give the Clearing Agency irrevocable instructions
and authority to pay the Redemption Price to the relevant Clearing
Agency Participants, and (B) with respect to Capital Securities issued
in certificated form and Common Securities, PROVIDED THAT the Debenture
Issuer has paid the Property Trustee a sufficient amount of cash in
connection with the related redemption or maturity of the Debentures,
the Property Trustee will irrevocably deposit with the paying agent for
the Capital Securities (if other than the Property Trustee) funds
sufficient to pay the applicable Redemption Price to the Holders by
check mailed to the address of the relevant Holder appearing on the
books and records of the Trust on the redemption date, and PROVIDED
FURTHER, that any such payment shall become due only upon surrender by
the Holder of the related certificated Capital Securities. If a
Redemption/ Distribution Notice shall have been given and funds
deposited as required, if applicable, then immediately prior to the
close of business on the date of such deposit, or on the redemption
date, as applicable, Distributions will cease to accumulate on the
Securities so called for redemption and all rights of Holders so called
for redemption will cease, except the right of the Holders of such
Securities to receive the Redemption Price, but without interest on
such Redemption Price, and such Securities shall cease to be
outstanding.
(iv) Payment of accumulated and unpaid Distributions on the
Redemption Date of the Securities will be subject to the rights of
Holders on the close of business on a regular record date in respect of
a Distribution Date occurring on or prior to such Redemption Date.
Neither the Administrative Trustees nor the Trust shall be
required to register or cause to be registered the transfer of (i) any
Securities beginning on the opening of business 15 days before the day of
mailing of a notice of redemption or any notice of selection of Securities for
redemption or (ii) any Securities selected for redemption except the unredeemed
portion of any Security being redeemed. If any date fixed for redemption of
Securities is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay). If payment
of the Redemption Price in respect of any Securities is improperly withheld or
refused and not paid either by the Property Trustee or by the Sponsor as
guarantor pursuant to the relevant Securities Guarantee, Distributions on such
Securities will continue to accumulate from the original redemption date to the
actual date of payment, in which case the actual payment date will be considered
the date fixed for redemption for purposes of calculating the Redemption Price.
(v) Redemption/Distribution Notices shall be sent by the
Property Trustee on behalf of the Trust to (A) in respect of Capital
Securities issued in book-entry form, the Clearing Agency or its
nominee (or any successor Clearing Agency or its nominee), (B) in
respect of Capital Securities issued in certificated form, to the
Holders thereof, and (C) in respect of the Common Securities, to the
Holders thereof.
(vi) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities laws and banking
laws), the Sponsor or any of its subsidiaries may at any time and from
time to time purchase outstanding Capital Securities by tender, in the
open market or by private agreement.
A-7
5. Voting Rights - Capital Securities.
(a) Except as provided under Sections 5(b), 6(b) and 7 and as
otherwise required by law and the Declaration, the Holders of the Capital
Securities will have no voting rights.
(b) So long as any Debentures are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Debenture Trustee or
executing any trust or power conferred on such Debenture Trustee with respect to
the Debentures, (ii) waive any past default that is waivable under Section 5.07
of the Indenture, (iii) exercise any right to rescind or annul a declaration of
acceleration of the maturity of the principal of the Debentures or (iv) consent
to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a Majority in Liquidation Amount
of all outstanding Capital Securities; provided, however, that where a consent
under the Indenture would require the consent of each holder of Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior approval of each Holder of the Capital Securities. The Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of the Capital Securities except by subsequent vote of such Holders. The
Property Trustee shall notify each Holder of Capital Securities of any notice of
default with respect to the Debentures. In addition to obtaining the foregoing
approvals of such Holders of the Capital Securities, prior to taking any of the
foregoing actions, the Trustees shall obtain an opinion of counsel experienced
in such matters to the effect that the Trust will continue to be classified as a
grantor trust for United States federal income tax purposes after taking any
such action into account.
If an Event of Default under the Declaration has occurred
and is continuing and such event is attributable to the failure of the
Debenture Issuer to pay principal of or premium, if any, or interest on the
Debentures on the due date (or, in the case of redemption, on the redemption
date), then a Holder of Capital Securities may institute a proceeding
directly against the Debenture Issuer for enforcement of payment to such
Holder of the principal of or premium, if any, or interest on a Like Amount
of Debentures (a "Direct Action") on or after the respective due date
specified in the Debentures. In connection with such Direct Action, the
Common Securities Holder will be subrogated to the rights of such Holder of
Capital Securities to the extent of any payment made by the Debenture Issuer
to such Holder of Capital Securities in such Direct Action. Except as
provided in the second preceding sentence except as set forth in the first
sentence of Section 3.8(e) of the Declaration, the Holders of Capital
Securities will not be able to exercise directly any other remedy available
to the holders of the Debentures.
Any approval or direction of Holders of Capital Securities may
be given at a separate meeting of Holders of Capital Securities convened for
such purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Property Trustee will cause a notice of any
meeting at which Holders of Capital Securities are entitled to vote to be mailed
to each Holder of record of Capital Securities. Each such notice will include a
statement setting forth (i) the date of such meeting or the date by which such
action is to be taken, (ii) a description of any resolution proposed for
adoption at such meeting on which such Holders are entitled to vote or of such
matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consent.
A-8
No vote or consent of the Holders of the Capital Securities
will be required for the Trust to redeem and cancel Capital Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
Notwithstanding that Holders of Capital Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Capital Securities that are owned by the Sponsor or any Affiliate of the
Sponsor shall not be entitled to vote or consent and shall, for purposes of such
vote or consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 6(b), 6(c), and 7 or as
otherwise required by law and the Declaration, the Holders of the Common
Securities will have no voting rights.
(b) Unless a Debenture Event of Default shall have occurred
and be continuing, any Trustee may be removed at any time by the Holder of the
Common Securities. If a Debenture Event of Default has occurred and is
continuing, the Property Trustee and the Delaware Trustee may be removed at such
time by the Holders of a Majority in Liquidation Amount of the outstanding
Capital Securities. In no event will the Holders of the Capital Securities have
the right to vote to appoint, remove or replace the Administrative Trustees,
which voting rights are vested exclusively in the Sponsor as the Holder of the
Common Securities. No resignation or removal of a Trustee and no appointment of
a successor trustee shall be effective until the acceptance of appointment by
the successor trustee in accordance with the provisions of the Declaration.
(c) So long as any Debentures are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Debenture Trustee, or
executing any trust or power conferred on such Debenture Trustee with respect to
the Debentures, (ii) waive any past default that is waivable under Section 5.07
of the Indenture, (iii) exercise any right to rescind or annul a declaration of
acceleration of the maturity of the principal of the Debentures or (iv) consent
to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a Majority in Liquidation Amount
of all outstanding Common Securities; provided, however, that where a consent
under the Indenture would require the consent of each holder of Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior approval of each Holder of the Common Securities. The Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of the Common Securities except by subsequent vote of such Holders. The Property
Trustee shall notify each Holder of Common Securities of any notice of default
with respect to the Debentures. In addition to obtaining the foregoing approvals
of such Holders of the Common Securities, prior to taking any of the foregoing
actions, the Trustees shall obtain an opinion of counsel experienced in such
matters to the effect that the Trust will continue to be classified as a grantor
trust for United States federal income tax purposes after taking any such action
into account.
If an Event of Default under the Declaration has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or premium, if any, or interest on the Debentures on
the due date (or in the case of redemption, on the redemption date), then a
Holder of Common Securities may institute a Direct Action directly against the
Debenture Issuer for enforcement of payment to such Holder of the principal of
or premium, if any, or interest
A-9
on a Like Amount of Debentures on or after the respective due date specified in
the Debentures. In connection with such Direct Action, the rights of the Common
Securities Holder will be subordinated to the rights of such Holder of Capital
Securities in respect of any payment from the Debenture Issuer in such Direct
Action. Except as provided in the second preceding sentence, the Holders of
Common Securities will not be able to exercise directly any other remedy
available to the holders of the Debentures.
Any approval or direction of Holders of Common Securities may
be given at a separate meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Administrative Trustees will cause a notice of
any meeting at which Holders of Common Securities are entitled to vote, or of
any matter upon which action by written consent of such Holders is to be taken,
to be mailed to each Holder of record of Common Securities. Each such notice
will include a statement setting forth (i) the date of such meeting or the date
by which such action is to be taken, (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to vote
or of such matter upon which written consent is sought and (iii) instructions
for the delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities
will be required for the Trust to redeem and cancel Common Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
7. Amendments to Declaration.
--------------------------
In addition to the requirements set out in Section 12.1 of the
Declaration, the Declaration may be amended from time to time by the Sponsor,
the Property Trustee and the Administrative Trustees without the consent of the
Holders (i) to cure any ambiguity, correct or supplement any provisions in the
Declaration that may be inconsistent with any other provisions, or to make any
other provisions with respect to matters or questions arising under the
Declaration which shall not be inconsistent with the other provisions of the
Declaration, (ii) to modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the Trust will
be classified for United States federal income tax purposes as a grantor trust
at all times that any Securities are outstanding or to ensure that the Trust
will not be required to register as an Investment Company under the Investment
Company Act or (iii) to modify, eliminate or add any provisions of the
Declaration to such extent as shall be necessary to enable the Trust or the
Sponsor to conduct an Exchange Offer in the manner contemplated by the
Registration Rights Agreement; provided, however, that in each case (other than
an amendment pursuant to clause (ii) above), such action shall not adversely
affect in any material respect the interests of any Holder, and any such
amendments of the Declaration shall become effective when notice thereof is
given to the Holders. The Declaration may also be amended by the Trustees and
the Sponsor with (i) the consent of Holders representing a Majority in
Liquidation Amount of all outstanding Securities, and (ii) receipt by the
Trustees of an Opinion of Counsel to the effect that such amendment or the
exercise of any power granted to the Trustees in accordance with such amendment
will not affect the Trust's status as a grantor trust for United States federal
income tax purposes or the Trust's exemption from status as an Investment
Company under the Investment Company Act; PROVIDED, HOWEVER, that, without the
consent of each Holder of Trust Securities, the Declaration may not be amended
to (i) change the amount or timing of any Distribution on, or the payment
required to be made in respect of, the
A-10
Trust Securities as of a specified date or (ii) restrict the right of a Holder
of Trust Securities to institute suit for the enforcement of any such payment on
or after such date.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
according to the aggregate liquidation amount of the Securities held by the
relevant Holder in relation to the aggregate liquidation amount of all
Securities outstanding unless, in relation to a payment, an Event of Default
under the Declaration has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the Capital
Securities pro rata according to the aggregate liquidation amount of Capital
Securities held by the relevant Holder relative to the aggregate liquidation
amount of all Capital Securities outstanding and then, only after satisfaction
of all amounts owed to the Holders of the Capital Securities, to each Holder of
Common Securities pro rata according to the aggregate liquidation amount of
Common Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Common Securities outstanding.
9. Ranking.
The Capital Securities rank PARI PASSU with the Common
Securities and payment thereon shall be made Pro Rata with the Common
Securities, except that, if an Event of Default under the Declaration occurs and
is continuing, no payments in respect of Distributions on, or payments upon
liquidation, redemption or otherwise with respect to, the Common Securities
shall be made until the Holders of the Capital Securities shall be paid in full
the Distributions, Redemption Price, Liquidation Distribution and other payments
to which they are entitled at such time.
10. Acceptance of Capital Securities Guarantee, Common Securities
Guarantee. Indenture and Debentures.
Each Holder of Capital Securities and Common Securities, by
the acceptance thereof, agrees to the provisions of the Capital Securities
Guarantee, the Common Securities Guarantee, the Indenture and the Debentures, as
applicable, including the subordination provisions therein.
11. No Preemptive Rights.
The issuance of Capital Securities and the issuance of Common
Securities is not subject to preemptive or other similar rights. The Holders
shall have no preemptive or similar rights to subscribe for any additional
securities.
12. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the
Capital Securities Guarantee or the Common Securities Guarantee, as applicable,
and the Indenture (including any supplemental indenture) to a Holder without
charge upon written request to the Trust at its principal place of business.
A-11
EXHIBIT A-1
FORM OF CAPITAL SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
[IF THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY,
INSERT: THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY WITHIN THE MEANING OF
THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY (THE "CLEARING AGENCY") OR A NOMINEE OF THE CLEARING
AGENCY. THIS CAPITAL SECURITY IS EXCHANGEABLE FOR CAPITAL SECURITIES REGISTERED
IN THE NAME OF A PERSON OTHER THAN THE CLEARING AGENCY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE DECLARATION AND NO TRANSFER OF THIS
CAPITAL SECURITY (OTHER THAN A TRANSFER OF THIS CAPITAL SECURITY AS A WHOLE BY
THE CLEARING AGENCY TO A NOMINEE OF THE CLEARING AGENCY OR BY A NOMINEE OF THE
CLEARING AGENCY TO THE CLEARING AGENCY OR ANOTHER NOMINEE OF THE CLEARING
AGENCY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE CLEARING AGENCY TO THE TRUST OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CAPITAL SECURITY ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE CLEARING AGENCY AND ANY PAYMENT HEREON IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]
[THIS CAPITAL SECURITY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAW. NEITHER THIS CAPITAL
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF
AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS CAPITAL SECURITY, PRIOR TO THE
DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE
LATER OF THE ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH RELIANCE
BANCORP, INC. (THE "CORPORATION") OR ANY "AFFILIATE" OF THE CORPORATION WAS THE
OWNER OF THIS CAPITAL SECURITY (OR ANY PREDECESSOR OF THIS CAPITAL SECURITY)
ONLY (A) TO THE CORPORATION, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS
BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) SO LONG AS THIS CAPITAL
SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
A-1
SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) 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) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (A)(1),
(2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS
CAPITAL SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT, SUBJECT TO THE RIGHT OF
RELIANCE CAPITAL TRUST I (THE "TRUST") AND THE CORPORATION PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM, AND (ii) PURSUANT TO CLAUSE (D) TO REQUIRE THAT
THE TRANSFEROR DELIVER TO THE TRUST A LETTER FROM THE TRANSFEREE SUBSTANTIALLY
IN THE FORM OF ANNEX A TO THE OFFERING MEMORANDUM DATED APRIL 23, 1998. SUCH
HOLDER FURTHER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CAPITAL
SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.]
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF
ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT,
INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") (EACH
A "PLAN"), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON
OF ANY PLAN'S INVESTMENT IN THE ENTITY AND NO PERSON INVESTING "PLAN ASSETS" OF
ANY PLAN MAY ACQUIRE OR HOLD THE CAPITAL SECURITIES OR ANY INTEREST THEREIN,
UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE
UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23,
95-60, 91-38, 90-1 OR 84-14 WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY
PURCHASE OR HOLDER OF THE CAPITAL SECURITIES OR ANY INTEREST THEREIN WILL BE
DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i)
IT IS NOT A PLAN OR PLAN ASSET ENTITY OR (ii) THE ACQUISITION AND HOLDING OF
THIS CAPITAL SECURITY BY IT IS NOT PROHIBITED BY EITHER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE OR IS EXEMPT FROM ANY SUCH PROHIBITION.
THE CAPITAL SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN
BLOCKS HAVING A LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 (100 CAPITAL
SECURITIES) AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF
CAPITAL SECURITIES IN A BLOCK HAVING A LIQUIDATION AMOUNT OF LESS THAN $100,000
SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED
TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCH CAPITAL SECURITIES FOR
ANY
A-2
PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON SUCH
CAPITAL SECURITIES, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO
INTEREST WHATSOEVER IN SUCH CAPITAL SECURITIES.
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
BE BOUND BY THE REGISTRATION RIGHTS AGREEMENT DATED AS OF APRIL 23, 1998, BY AND
AMONG THE TRUST, THE DEBENTURE TRUSTEE AND THE INITIAL PURCHASERS NAMED THEREIN,
AS AMENDED FROM TIME TO TIME.
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Certificate Number: Aggregate Liquidation
Amount: $
CUSIP Number:
Certificate Evidencing Capital Securities
of
Reliance Capital Trust I
8.17% Capital Securities, Series A
(liquidation amount $1,000 per Capital Security)
Reliance Capital Trust I, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), hereby
certifies that ________________ (the "Holder") is the registered owner of
[$_________ in aggregate liquidation amount of Capital Securities of the Trust]
[the aggregate liquidation amount of Capital Securities of the Trust specified
in Schedule A hereto] (1) representing undivided preferred beneficial
interests in the assets of the Trust designated the 8.17% Capital Securities,
Series A (liquidation amount $1,000 per Capital Security) (the "Capital
Securities"). The Capital Securities are transferable on the books and
records of the Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer.
The designation, rights, privileges, restrictions, preferences and other
terms and provisions of the Capital Securities represented hereby are issued
and shall in all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust, dated as of April 28, 1998, as
the same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Capital Securities as set forth in Annex I to
the Declaration. Capitalized terms used but not defined herein shall have the
meaning given them in the Declaration. The Sponsor will provide a copy of the
Declaration, the Capital Securities Guarantee and the Indenture (including
any supplemental indenture) to a Holder without charge upon written request
to the Trust at its principal place of business.
Upon receipt of this Certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Capital Securities Guarantee to the extent provided therein.
By acceptance hereof, the Holder agrees to treat, for United
States federal income tax purposes, the Debentures as indebtedness and the
Capital Securities as evidence of indirect beneficial ownership in the
Debentures.
- --------
(1) Insert in Global Capital Securities only.
A-4
IN WITNESS WHEREOF, the Trust has executed this certificate
this _______ day of , .
RELIANCE CAPITAL TRUST I
By:
Name:
Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 8.17% Capital Securities, Series A of Reliance
Capital Trust I referred to in the within-mentioned Declaration.
Dated: ,
THE BANK OF NEW YORK,
not in its individual capacity but
solely as Property Trustee
By:
Authorized Signatory
A-5
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Capital Security will be fixed
at a rate per annum of 8.17% (the "Coupon Rate") of the liquidation amount of
$1,000 per Capital Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for more
than one semi-annual period will bear interest thereon compounded semi-annually
at the Coupon Rate (to the extent permitted by applicable law). Pursuant to the
Registration Rights Agreement, in certain limited circumstances the Debenture
Issuer will be required to pay Liquidated Damages (as defined in the
Registration Rights Agreement) with respect to the Debentures. The term
"Distributions", as used herein, includes such cash distributions and any and
all such interest and Liquidated Damages, if any, payable unless otherwise
stated. A Distribution is payable only to the extent that payments are made in
respect of the Debentures held by the Property Trustee and to the extent the
Property Trustee has funds legally available therefor.
Distributions on the Capital Securities will be cumulative,
will accumulate from the most recent date to which Distributions have been paid
or, if no Distributions have been paid, from April 28, 1998 and will be payable
semi-annually in arrears, on May 1 and November 1 of each year, commencing
November 1, 1998, except as otherwise described below. Distributions will be
computed on the basis of a 360-day year consisting of twelve 30-day months. As
long as no Event of Default has occurred and is continuing under the Indenture,
the Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period at any time and from time to
time on the Debentures for a period not exceeding 10 consecutive calendar
semi-annual periods, including the first such semi-annual period during such
extension period (each an "Extension Period"), PROVIDED THAT no Extension Period
shall end on a date other than an Interest Payment Date for the Debentures or
extend beyond the Maturity Date of the Debentures. As a consequence of such
deferral, Distributions will also be deferred. Notwithstanding such deferral,
semi-annual Distributions will continue to accumulate with interest thereon (to
the extent permitted by applicable law, but not at a rate exceeding the rate of
interest then accruing on the Debentures) at the Coupon Rate compounded
semi-annually during any such Extension Period. Prior to the termination of any
Extension Period, the Debenture Issuer may further defer payments of interest by
further extending such Extension Period; PROVIDED THAT such Extension Period,
together with all such previous and further extensions within such Extension
Period, may not (i) exceed 10 consecutive semi-annual periods, including the
first semi-annual period during such Extension Period, (ii) end on a date other
than an Interest Payment Date for the Debentures or (iii) extend beyond the
Maturity Date of the Debentures. Payments of accumulated Distributions will be
payable to Holders as they appear on the books and records of the Trust on the
record date immediately preceding the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the above
requirements.
Subject to receipt by the Sponsor of any and all required
regulatory approvals and to certain other conditions set forth in the
Declaration and the Indenture, the Property Trustee may, at the direction of the
Sponsor, at any time dissolve the Trust and cause, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, the
Debentures to be distributed to the
A-6
holders of the Securities in liquidation of the Trust or, simultaneously with
any redemption of the Debentures, cause a Like Amount of the Securities to be
redeemed by the Trust.
The Capital Securities shall be redeemable as provided in the
Declaration.
A-7
-----------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital Security
Certificate to:
- -------------------------------------------------------------------------------:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- -------------------------------------------------------------------------------:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
- -------------------------------------------------------------------------------:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------agent
to transfer this Capital Security Certificate on the books of the Trust. The
agent may substitute another to act for him or her.
Date: ------------------------------
Signature: --------------------------------------
(Sign exactly as your name appears on the other side of this Capital Security
Certificate)
Signature Guarantee: ----------------------------------------
- ---------------------------------
Signature must be guaranteed by an "eligible guarantor institution"
that is a bank, stockbroker, savings and loan association or credit
union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer Agents
Medallion Program ("STAMP") or such other "signature guarantee program"
as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange
Act of 1934, as amended.
A-8
[Include the following if the Capital Security bears a Restricted Securities
Legend] -
In connection with any transfer of any of the Capital Securities evidenced by
this Certificate, the undersigned confirms that such Capital Securities are
being:
CHECK ONE BOX BELOW
(1) / / exchanged for the undersigned's own account without
transfer; or
(2) / / transferred pursuant to and in compliance with Rule
144A under the Securities Act of 1933; or
(3) / / transferred to an institutional "accredited
investor" within the meaning of subparagraph (a)(1),
(2), (3) or (7) of Rule 501 under the Securities Act
of 1933 that is acquiring the Capital Securities for
its own account, or for the account of such an
institutional "accredited investor," for investment
purposes and not with a view to, or for offer or sale
in connection with, any distribution in violation of
the Securities Act of 1933; or
(4) / / transferred pursuant to another available exemption
from the registration requirements of the Securities
Act of 1933; or
(5) / / transferred pursuant to an effective registration
statement.
Unless one of the boxes is checked, the Registrar will refuse to register any of
the Capital Securities evidenced by this Certificate in the name of any Person
other than the Holder hereof; PROVIDED, HOWEVER, that if box (3) or (4) is
checked, the Registrar may require, prior to registering any such transfer of
the Capital Securities, such legal opinions, certifications and other
information as the Trust has reasonably requested to confirm that such transfer
is being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act of 1933, such as the
exemption provided by Rule 144 under such Act; PROVIDED, FURTHER, that (i) if
box (2) is checked, by acceptance of this Certificate, the transferee shall be
deemed to have certified that it is a "qualified institutional buyer" (as
defined in Rule 144A) acquiring the Capital Securities for its own account or
for the account of another QIB over which it exercises sole investment
discretion and that it is aware that the Holder is relying upon the exemption
from registration afforded by Rule 144A in respect of the Holder's transfer of
Capital Securities to it or (ii) if box (3) is checked, the transferee must also
provide to the Registrar a Transferee Letter of Representation in the form
attached to the Offering Memorandum of the Trust dated April 23, 1998; PROVIDED,
FURTHER, that after the date that a registration statement has been filed and so
long as such Registration Statement continues to be effective, only then may the
Registrar permit transfers for which box (5) has been checked.
----------------------------------
Signature
A-9
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAW. NEITHER THIS COMMON SECURITY NOR ANY INTEREST
OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS COMMON SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER THIS COMMON SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH RELIANCE BANCORP, INC.
(THE "CORPORATION") OR ANY "AFFILIATE" OF THE CORPORATION WAS THE OWNER OF THIS
COMMON SECURITY (OR ANY PREDECESSOR OF THIS COMMON SECURITY) ONLY (A) TO THE
CORPORATION, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) SO LONG AS THIS COMMON SECURITY IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER"
(AS DEFINED IN RULE 144A) 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) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501
UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS COMMON SECURITY FOR ITS OWN
ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (E) PURSUANT TO
ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE
SECURITIES ACT, SUBJECT TO THE RIGHT OF RELIANCE CAPITAL TRUST I (THE "TRUST")
AND THE CORPORATION PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO
CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii)
PURSUANT TO CLAUSE (D) TO REQUIRE THAT TRANSFEROR DELIVER TO THE TRUST A LETTER
FROM THE TRANSFEREE SUBSTANTIALLY IN THE FORM OF ANNEX A TO THE OFFERING
MEMORANDUM DATED APRIL 23, 1998. SUCH HOLDER FURTHER AGREES THAT IT WILL DELIVER
TO EACH PERSON TO WHOM THIS COMMON SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
A-1
Certificate Evidencing Common Securities
of
Reliance Capital Trust I
8.17% Common Securities
(liquidation amount $1,000 per Common Security)
Reliance Capital Trust I, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
Reliance Bancorp, Inc. (the "Holder") is the registered owner of 1,547 common
securities of the Trust representing undivided beneficial interests in the
assets of the Trust designated the 8.17% Common Securities (liquidation amount
$1,000 per Common Security) (the "Common Securities"). Subject to the terms of
the Declaration (as defined below), the Common Securities are transferable on
the books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this Certificate duly endorsed and in proper form for
transfer. The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Common Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended and
Restated Declaration of Trust of the Trust dated as of April 28, 1998, as the
same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Common Securities as set forth in Annex I to the
Declaration. Capitalized terms used but not defined herein shall have the
meaning given them in the Declaration. The Sponsor will provide a copy of the
Declaration, the Common Securities Guarantee and the Indenture (including any
supplemental indenture) to a Holder without charge upon written request to the
Trust at its principal place of business.
Upon receipt of this Certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Common Securities Guarantee to the extent provided therein.
By acceptance hereof, the Holder agrees to treat, for United
States federal income tax purposes, the Debentures as indebtedness and the
Common Securities as evidence of indirect beneficial ownership in the
Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate
this ________________ day of ________________, _____________________.
RELIANCE CAPITAL TRUST I
By:
------------------------------
Name:
Administrative Trustee
A-2
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed at
a rate per annum of 8.17% (the "Coupon Rate") of the liquidation amount of
$1,000 per Common Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for more
than one semi-annual period will bear interest thereon compounded semi-annually
at the Coupon Rate (to the extent permitted by applicable law). Pursuant to the
Registration Rights Agreement, in certain limited circumstances the Debenture
Issuer will be required to pay Liquidated Damages (as defined in the
Registration Rights Agreement) with respect to the Debentures. The term
"Distributions", as used herein, includes such cash distributions and any and
all such interest and Liquidated Damages, if any, payable unless otherwise
stated. A Distribution is payable only to the extent that payments are made in
respect of the Debentures held by the Property Trustee and to the extent the
Property Trustee has funds legally available therefor.
Distributions on the Common Securities will be cumulative,
will accrue from the most recent date to which Distributions have been paid or,
if no Distributions have been paid, from April 28, 1998 and will be payable
semi-annually in arrears, on May 1 and November 1 of each year, commencing
November 1, 1998, except as otherwise described below. Distributions will be
computed on the basis of a 360-day year consisting of twelve 30-day months. As
long as no Event of Default has occurred and is continuing under the Indenture,
the Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period at any time and from time to
time on the Debentures for a period not exceeding 10 consecutive calendar
semi-annual periods, including the first such semi-annual period during such
extension period (each an "Extension Period"), provided that no Extension Period
shall end on a date other than an Interest Payment Date for the Debentures or
extend beyond the Maturity Date of the Debentures. As a consequence of such
deferral, Distributions will also be deferred. Notwithstanding such deferral,
Distributions will continue to accumulate with interest thereon (to the extent
permitted by applicable law, but not at a rate exceeding the rate of interest
then accruing on the Debentures) at the Coupon Rate compounded semi-annually
during any such Extension Period. Prior to the termination of any Extension
Period, the Debenture Issuer may further defer payments of interest by further
extending such Extension Period; provided that such Extension Period, together
with all such previous and further extensions within such Extension Period, may
not (i) exceed 10 consecutive semi-annual periods, including the first
semi-annual period during such Extension Period, (ii) end on a date other than
an Interest Payment Date for the Debentures or (iii) extend beyond the Maturity
Date of the Debentures. Payments of accrued Distributions will be payable to
Holders as they appear on the books and records of the Trust on the record date
immediately preceding the end of the Extension Period. Upon the termination of
any Extension Period and the payment of all amounts then due, the Debenture
Issuer may commence a new Extension Period, subject to the above requirements.
Subject to the receipt by the Sponsor of any and all required
regulatory approvals and to certain other conditions set forth in the
Declaration and the Indenture, the Property Trustee may, at the direction of the
Sponsor, at any time dissolve the Trust and cause the Debentures to be
distributed to the holders of the Securities in liquidation of the Trust or,
simultaneously with any redemption of the Debentures, cause a Like Amount of the
Securities to be redeemed by the Trust.
The Common Securities shall be redeemable as provided in the
Declaration.
A-3
Under certain circumstances, the right of the holders of the
Common Securities shall be subordinate to the rights of the holders of the
Capital Securities, as provided in the Declaration.
A-4