Amended and Restated
Trust Agreement for PSE&G Capital Trust II
among
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
(as Depositor)
FIRST UNION NATIONAL BANK
(as Property Trustee)
FIRST UNION BANK OF DELAWARE
(as Delaware Trustee)
and
THE ADMINISTRATIVE TRUSTEE NAMED HEREIN
Dated as of
February 7, 1997
(vii)
TABLE OF CONTENTS
Page
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ARTICLE I
Defined Terms
Section 1.01. Definitions................................................... 2
ARTICLE II
Continuation of the Trust
Section 2.01. Name.......................................................... 10
Section 2.02. Office of the Delaware Trustee; Principal Place
of Business................................................... 10
Section 2.03. Initial Contribution of Trust Property; Expenses
of the Trust.................................................. 10
Section 2.04. Issuance of the Trust Securities.............................. 11
Section 2.05. Purchase of Debentures........................................ 11
Section 2.06. Declaration of Trust.......................................... 12
Section 2.07. Authorization to Enter into Certain
Transactions.................................................. 12
Section 2.08. Assets of Trust............................................... 16
Section 2.09. Title to Trust Property....................................... 16
ARTICLE III
Payment Account
Section 3.01. Payment Account............................................... 16
ARTICLE IV
Distributions; Redemption
Section 4.01. Distributions................................................. 17
Section 4.02. Redemption.................................................... 18
Section 4.03. Subordination of Common Securities............................ 20
Section 4.04. Payment Procedures............................................ 21
Section 4.05. Tax Returns and Reports....................................... 21
ARTICLE V
Trust Securities Certificates
Section 5.01. Initial Ownership............................................. 22
Section 5.02. The Trust Securities Certificates............................. 22
(i)
Section 5.03. Delivery of Trust Securities Certificates..................... 22
Section 5.04. Registration of Transfer and Exchange of
Preferred Securities Certificates............................. 23
Section 5.05. Mutilated, Destroyed, Lost or Stolen Trust
Securities Certificates....................................... 24
Section 5.06. Persons Deemed Securityholders................................ 24
Section 5.07. Access to List of Securityholders' Names
and Addresses................................................. 24
Section 5.08. Maintenance of Office or Agency............................... 25
Section 5.09. Appointment of Paying Agent................................... 25
Section 5.10. No Transfer of Common Securities by Depositor................. 26
Section 5.11. Book-Entry Preferred Securities Certificates;
Common Securities Certificate............ 26
Section 5.12. Definitive Preferred Securities Certificates.................. 26
Section 5.13. Rights of Securityholders..................................... 27
ARTICLE VI
Acts of Securityholders; Meetings; Voting
Section 6.01. Limitations on Voting Rights.................................. 28
Section 6.02. Notice of Meetings............................................ 29
Section 6.03. Meetings of Preferred Securityholders......................... 29
Section 6.04. Voting Rights................................................. 29
Section 6.05. Proxies, etc.................................................. 29
Section 6.06. Securityholder Action by Written Consent...................... 30
Section 6.07. Record Date for Voting and Other Purposes..................... 30
Section 6.08. Acts of Securityholders....................................... 30
Section 6.09. Inspection of Records......................................... 31
ARTICLE VII
The Trustees
Section 7.01. Certain Duties and Responsibilities........................... 32
Section 7.02. Notice of Defaults; Direct Action by
Securityholders............................................... 33
Section 7.03. Certain Rights of Property Trustee............................ 33
Section 7.04. Not Responsible for Recitals or Issuance of
Securities.................................................... 35
Section 7.05. May Hold Securities........................................... 35
Section 7.06. Compensation; Indemnity; Fees................................. 35
Section 7.07. Corporate Property Trustee Required; Eligibility
of Trustees................................................... 36
Section 7.08. Conflicting Interests......................................... 36
Section 7.09. Co-Trustees and Separate Trustee.............................. 37
Section 7.10. Resignation and Removal; Appointment of
Successor..................................................... 38
Section 7.11. Acceptance of Appointment by Successor........................ 40
(ii)
Section 7.12. Merger, Conversion, Consolidation or Succession
to Business................................................... 41
Section 7.13. Preferential Collection of Claims Against
Depositor or Trust............................................ 41
Section 7.14. Reports by Property Trustee................................... 41
Section 7.15. Reports to the Property Trustee............................... 42
Section 7.16. Evidence of Compliance with Conditions
Precedent..................................................... 42
Section 7.17. Statements Required in Officer's Certificate
and Opinion of Counsel........................................ 42
Section 7.18. Number of Trustees............................................ 42
Section 7.19. Delegation of Power........................................... 43
Section 7.20. Voting........................................................ 43
ARTICLE VIII
Termination and Liquidation
Section 8.01. Termination Upon Expiration Date.............................. 44
Section 8.02. Early Termination............................................. 44
Section 8.03. Termination................................................... 44
Section 8.04. Liquidation................................................... 44
ARTICLE IX
Mergers, Etc.
Section 9.01. Mergers, Consolidations, Amalgamations or
Replacements of the Trust..................................... 46
ARTICLE X
Miscellaneous Provisions
Section 10.01. Limitation of Rights of Securityholders....................... 48
Section 10.02. Amendment..................................................... 48
Section 10.03. Severability.................................................. 49
Section 10.04. Governing Law................................................. 49
Section 10.05. Payments Due on Non-Business Day.............................. 50
Section 10.06. Successors and Assigns........................................ 50
Section 10.07. Headings...................................................... 50
Section 10.08. Reports, Notices and Demands.................................. 50
Section 10.09. Agreement Not to Petition..................................... 51
Section 10.10. Trust Indenture Act; Conflict with Trust
Indenture Act................................................. 51
Section 10.11. Acceptance of Terms of Trust Agreement,
Guarantee and Indenture....................................... 52
(iii)
Page
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(iv)
Page
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(v)
PSE&G Capital Trust II
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939
Trust Indenture Trust Agreement
Act Section Section
- --------------- ---------------
ss.310(a)(1)................................................................7.07
(a)(2)................................................................7.07
(a)(3)................................................................7.09
(a)(4).........................................................2.07(a)(ii)
(b)...................................................................7.08
ss.311(a)...................................................................7.13
(b)...................................................................7.13
ss.312(a)...................................................................5.07
(b)...................................................................5.07
(c)...................................................................5.07
ss.313(a)...................................................................7.14
(b)...................................................................7.14
(c)...................................................................7.14
(d)...................................................................7.14
ss.314(a)...................................................................7.15
(b).........................................................Not Applicable
(c)(1)..........................................................7.16, 7.17
(c)(2)..........................................................7.16, 7.17
(c)(3)......................................................Not Applicable
(d).........................................................Not Applicable
(e).................................................................. 7.17
ss.315(a).......................................................7.01(a), 7.03(a)
(b)............................................................7.02, 10.08
(c)................................................................7.01(a)
(d).............................................................7.01, 7.03
(e).........................................................Not Applicable
ss.316(a).........................................................Not Applicable
(a)(1)(A)...................................................Not Applicable
(a)(1)(B)...................................................Not Applicable
(a)(2)......................................................Not Applicable
(b).........................................................Not Applicable
(c).........................................................Not Applicable
ss.317(a)(1)......................................................Not Applicable
(a)(2)......................................................Not Applicable
(b)...................................................................5.09
ss.318(a)..................................................................10.10
- ------------------
Note: This reconciliation and tie sheet shall not, for any
purpose, be deemed to be a part of the Trust Agreement.
(vi)
AMENDED AND RESTATED TRUST AGREEMENT of PSE&G Capital Trust II (the
"Trust"), dated as of February 7, 1997, among (i) Public Service Electric and
Gas Company, a New Jersey corporation (the "Depositor"), (ii) First Union
National Bank, a national banking association, as trustee (the "Property
Trustee"), (iii) First Union Bank of Delaware, whose address in Delaware is 1225
King Street, Wilmington, Delaware 19801, as Delaware trustee (the "Delaware
Trustee"), (iv) Fred F. Saunders, an individual whose address is c/o Public
Service Electric and Gas Company, 80 Park Plaza, P.O. Box 570, Newark, New
Jersey 07101 (the "Administrative Trustee") (the Property Trustee, the Delaware
Trustee and the Administrative Trustee are referred to collectively as the
"Trustees"), and (v) the several Holders, as hereinafter defined.
WITNESSETH:
WHEREAS, the Depositor, the Property Trustee, the Delaware Trustee and the
Administrative Trustee have heretofore duly declared and established a business
trust pursuant to the Delaware Business Trust Act by entering into a Trust
Agreement, dated as of April 19, 1996 (the "Original Trust Agreement"), and by
executing and filing with the Secretary of State of the State of Delaware a
Certificate of Trust on April 19, 1996, a form of which is attached hereto as
Exhibit A; and
WHEREAS, the Depositor, the Property Trustee, the Delaware Trustee and the
Administrative Trustee desire to amend and restate the Original Trust Agreement
in its entirety as set forth herein to provide for, among other things, (i) the
issuance of the Common Securities, as hereinafter defined, by the Trust to the
Depositor, (ii) the issuance and sale of the Preferred Securities, as
hereinafter defined, by the Trust pursuant to the Underwriting Agreement, as
hereinafter defined, and (iii) the acquisition by the Trust from the Depositor
of the Debentures, as hereinafter defined.
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party, for the benefit of the other party and
for the benefit of the Securityholders, as hereinafter defined, hereby amends
and restates the Original Trust Agreement in its entirety and agrees as follows:
ARTICLE I
Defined Terms
Section 1.01. Definitions. For all purposes of this Trust Agreement, except
as otherwise expressly provided or unless the context otherwise requires:
(a) each term defined in this Article I has the meaning assigned to it
in this Article I and includes the plural as well as the singular;
(b) each of the other terms used herein that is defined in the Trust
Indenture Act, either directly or by reference therein, has the meaning
assigned to it therein;
(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Trust Agreement; and
(d) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.08.
"Administrative Trustee" means the individual identified as the
"Administrative Trustee" in the preamble to this Trust Agreement, solely in
his/her capacity as Administrative Trustee of the Trust created and continued
hereunder and not in his/her individual capacity, or such Administrative
Trustee's successor in interest in such capacity, or any successor trustee
appointed as herein provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bankruptcy Event" means, with respect to any Person, the occurrence of any
of the following events:
(a) Such Person, pursuant to or within the meaning of
2
any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in an
involuntary case or proceeding;
(iii) consents to the appointment of a Custodian, as hereinafter defined,
of it or for all or substantially all of its property, and such
Custodian is not discharged within 60 days;
(iv) makes a general assignment for the benefit of its creditors; or
(v) admits in writing its inability to pay its debts generally as they
become due; or
(b) A court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against such Person in an involuntary case or
proceeding;
(ii) appoints a Custodian of such Person for all or substantially all of
its properties;
(iii) orders the liquidation of such Person;
(iv) and in each case the order or decree remains unstayed and in effect
for 60 days.
"Bankruptcy Laws" means Title 11 of the United States Code, or similar
federal or state law for the relief of debtors. "Custodian" means any receiver,
trustee, assignee, liquidator, sequestrator, custodian or similar official under
any Bankruptcy Law.
"Board Resolution" means (i) a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Depositor to have been duly adopted
by the Depositor's Board of Directors or a committee established thereby and to
be in full force and effect on the date of such certification or (ii) a
certificate signed by the authorized officer or officers of the
3
Depositor to whom the Depositor's Board of Directors or a committee established
thereby has delegated its authority, and in each case, delivered to the
Trustees.
"Book-Entry Preferred Securities Certificates" means certificates
representing Preferred Securities issued in global, fully registered form with
the Clearing Agency as described in Section 5.11.
"Business Day" means a day other than (a) a Saturday or Sunday, or (b) a
day on which banking institutions in The City of New York or the State of New
Jersey are required by law or executive order to remain closed.
"Certificate Depository Agreement" means the agreement among the Trust, the
Property Trustee and The Depository Trust Company, as the initial Clearing
Agency, dated as of the Closing Date, relating to the Book-Entry Preferred
Securities Certificates, substantially in the form attached hereto as Exhibit B,
as the same may be amended and supplemented from time to time.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder. The Depository Trust Company
will be the initial Clearing Agency.
"Closing Date" means the Time of Delivery as defined in the Underwriting
Agreement, which date is also the date of execution and delivery of this Trust
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Securities Exchange Act of 1934, as amended,
or, if at any time after the execution of this Trust Agreement such Commission
is not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.
"Common Security" means an undivided beneficial interest in the assets of
the Trust, having a Liquidation Amount of $25 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate
4
evidencing ownership of Common Securities, substantially in the form attached
hereto as Exhibit C.
"Corporate Trust Office" means the principal corporate trust office of the
Property Trustee located in the State of New Jersey which at the date hereof is
765 Broad Street, Newark, New Jersey 07107.
"Creditor" has the meaning specified in Section 2.03.
"Debenture Event of Default" means an "Event of Default" as defined in the
Indenture with respect to the Debentures.
"Debenture Redemption Date" means "Redemption Date" as defined in the
Indenture with respect to the Debentures.
"Debenture Trustee" means First Union National Bank, a national banking
association, in its capacity as trustee under the Indenture, or any successor
thereto, appointed in accordance with the terms and provisions of the Indenture.
"Debentures" means the Depositor's 8.125% Deferrable Interest Subordinated
Debentures, Series B, issued pursuant to the Indenture.
"Definitive Preferred Securities Certificates" means certificates
representing Preferred Securities issued in certificated, fully registered form
as described in Section 5.12.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C.ss. 3801, et seq., as it may be amended from time to time.
"Delaware Trustee" means the entity identified as the "Delaware Trustee" in
the preamble to this Trust Agreement solely in its capacity as Delaware Trustee
of the Trust created and continued hereunder and not in its individual capacity,
or its successor in interest in such capacity, or any successor trustee
appointed as herein provided.
"Depositor" has the meaning specified in the preamble to this Trust
Agreement.
"Distribution Date" has the meaning specified in Section 4.01(a).
"Distributions" means amounts payable in respect of the Trust Securities as
provided in Section 4.01.
5
"Event of Default" means the occurrence of a Debenture Event of Default
(whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body).
"Expiration Date" has the meaning specified in Section 8.01.
"Extension Period" means the period or periods in which pursuant to the
Indenture payments of interest on the Debentures are deferred by extending the
interest payment periods thereof.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Depositor to First Union National Bank, a national banking association, as
trustee thereunder, contemporaneously with the execution and delivery of this
Trust Agreement, for the benefit of the Holders of the Preferred Securities, as
amended from time to time.
"Indenture" means the Indenture, dated as of June 1, 1996, between the
Depositor and the Debenture Trustee, as trustee thereunder, as amended or
supplemented from time to time.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust Securities,
Trust Securities having an aggregate Liquidation Amount equal to the principal
amount of Debentures to be paid in accordance with the Indenture and (b) with
respect to a distribution of Debentures to Holders of Trust Securities in
connection with a termination and liquidation of the Trust, Debentures having a
principal amount equal to the aggregate Liquidation Amount of the Trust
Securities in exchange for which such Debentures are distributed.
"Liquidation Amount" means the stated amount of $25 per Trust Security.
"Liquidation Date" means the date on which Debentures are to be distributed
to Holders of Trust Securities in connection with a termination and liquidation
of the Trust pursuant to Section 8.04(a).
6
"Liquidation Distribution" has the meaning specified in Section 8.04(d).
"1940 Act" means the Investment Company Act of 1940, as amended.
"Officers' Certificate" means a certificate signed by the Chairman, the
President, any Vice President, the Treasurer, any Assistant Treasurer, the
Secretary or any Assistant Secretary of the Depositor.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Trust, the Property Trustee or the Depositor or an Affiliate of the
Depositor, but not an employee of any thereof, and who shall be acceptable to
the Property Trustee.
"Original Trust Agreement" has the meaning specified in the recitals to
this Trust Agreement.
"Outstanding", when used with respect to Trust Securities, means, as of the
date of determination, all Trust Securities theretofore executed and delivered
under this Trust Agreement, except:
(a) Trust Securities theretofore cancelled by the Administrative
Trustee or delivered to the Administrative Trustee for cancellation;
(b) Trust Securities for whose redemption money in the necessary
amount has been theretofore deposited with the Property Trustee or any
Paying Agent for the Holders of such Trust Securities; provided that, if
such Trust Securities are to be redeemed, notice of such redemption has
been duly given pursuant to this Trust Agreement;
(c) Trust Securities which have been paid or in exchange for or in
lieu of which other Trust Securities have been executed and delivered
pursuant to Section 5.05, other than any such Trust Securities in respect
of which there shall have been presented to the Property Trustee proof
satisfactory to it that such Trust Securities are held by a bona fide
purchaser; and
(d) as provided in Section 8.04(c);
provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Preferred
7
Securities owned by the Depositor, any Trustee or any Affiliate of the Depositor
or any Trustee shall be disregarded and deemed not to be Outstanding, except
that (a) in determining whether any Trustee shall be protected in relying upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Preferred Securities which such Trustee actually knows to be so owned shall
be so disregarded and (b) the foregoing shall not apply at any time when all of
the Outstanding Preferred Securities are owned by the Depositor, one or more of
the Trustees and/or any such Affiliate. Preferred Securities so owned which have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Administrative Trustee the pledgee's
right so to act with respect to such Preferred Securities and that the pledgee
is not the Depositor or any Affiliate of the Depositor.
"Paying Agent" means the Property Trustee and any co-paying agent appointed
pursuant to Section 5.09.
"Payment Account" means a segregated non-interest-bearing corporate trust
account maintained by the Property Trustee in its trust department for the
benefit of the Securityholders in which all amounts paid to the Property Trustee
in respect of the Debentures or the Guarantee will be held and from which the
Property Trustee or such other Paying Agent shall make payments to the
Securityholders in accordance with Article 4.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
other entity.
"Preferred Security" means a 8.125% Cumulative Quarterly Income Preferred
Security, Series B issued by the Trust, and having an undivided beneficial
interest in the assets of the Trust, having a Liquidation Amount of $25 and
having rights provided therefor in this Trust Agreement, including the right to
receive Distributions and a Liquidation Distribution as provided herein.
"Preferred Securities Certificate" means a certificate evidencing ownership
of one or more Preferred Securities, substantially in the form attached hereto
as Exhibit D.
"Property Trustee" means the commercial bank or trust company identified as
the "Property Trustee" in the preamble to this Trust Agreement solely in its
capacity as Property Trustee of the Trust heretofore created and continued
hereunder and not in its individual capacity, or its successor in interest in
such capacity, or any successor property trustee appointed as herein provided.
8
"Redemption Date" means, with respect to any Trust Security to be redeemed,
the date fixed for such redemption by or pursuant to this Trust Agreement;
provided that each Debenture Redemption Date and the stated maturity of the
Debentures shall be a Redemption Date for a Like Amount of Trust Securities.
"Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions thereon to the Redemption Date.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.04.
"Securityholder" or "Holder" means a Person in whose name a Trust Security
or Securities is registered in the Securities Register; any such Person is a
beneficial owner within the meaning of the Delaware Business Trust Act.
"Successor Securities" has the meaning specified in Section 8.05.
"Trust" means the Delaware business trust created and continued hereby and
identified on the cover page to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as the
same may be modified, amended or supplemented in accordance with the applicable
provisions hereof, including all exhibits hereto, including, for all purposes of
this Trust Agreement and any such modification, amendment or supplement, the
provisions of the Trust Indenture Act that are deemed to be a part of and govern
this Trust Agreement and any such modification, amendment or supplement,
respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this Trust Agreement was executed; provided, however, that
in the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Debentures, (b) any cash on deposit in, or
owing to, the Payment 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 the trusts of this Trust Agreement.
9
"Trust Security" means any one of the Common Securities or the Preferred
Securities.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"Underwriting Agreement" means the Underwriting Agreement, dated February
4, 1997, among the Trust, the Depositor and the Underwriters named therein.
ARTICLE II
Continuation of the Trust
Section 2.01. Name. The Trust created and continued hereby shall be known
as "PSE&G Capital Trust II" as such name may be modified from time to time by
the Administrative Trustee following written notice to the Holders of Trust
Securities and the other Trustees, in which name the Trustees may conduct the
business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and sue and be sued.
Section 2.02. Office of the Delaware Trustee; Principal Place of Business.
The address of the Delaware Trustee in the State of Delaware is 1225 King
Street, Wilmington, Delaware 19801 or such other address in the State of
Delaware as the Delaware Trustee may designate by written notice to the
Securityholders and the Depositor. The principal place of business of the Trust
is 80 Park Plaza, Newark, New Jersey 07101.
Section 2.03. Initial Contribution of Trust Property; Expenses of the
Trust.
(a) The Property Trustee acknowledges receipt in trust from the Depositor
in connection with the Original Trust Agreement of the sum of $10, which
constituted the initial Trust Property.
(b) The Depositor shall be responsible for and shall pay for all
obligations (other than with respect to the Trust Securities) and all costs and
expenses of the Trust (including, but not limited to, costs and expenses
relating to the organization of the Trust, the issuance and sale of the
Preferred Securities, the fees and expenses (including reasonable counsel fees
and expenses) of the Trustees as provided in Section 7.06, the costs and
expenses of accountants, attorneys, statistical or bookkeeping services,
expenses for printing and engraving and computing or accounting equipment,
Paying Agent(s), Securities Registrar, duplication, travel and telephone and
other telecommunications expenses and
10
costs and expenses incurred in connection with the disposition of Trust assets).
(c) The Depositor will pay any and all taxes (other than United States
withholding taxes attributable to the Trust or its assets) and all liabilities,
costs and expenses with respect to such taxes of the Trust.
(d) The Depositor's obligations under this Section 2.03 shall be for the
benefit of, and shall be enforceable by, the Property Trustee and any Person to
whom any such obligations, costs, expenses and taxes are owed (a "Creditor")
whether or not such Creditor has received notice hereof. The Property Trustee
and any such Creditor may enforce the Depositor's obligations under this Section
2.03 directly against the Depositor and the Depositor irrevocably waives any
right or remedy to require that the Property Trustee or any such Creditor take
any action against the Trust or any other Person before proceeding against the
Depositor. The Depositor agrees to execute such additional agreements as may be
necessary or desirable in order to give full effect to the provisions of this
Section 2.03.
(e) The Depositor shall make no claim upon the Trust Property for the
payment of such expenses.
Section 2.04. Issuance of the Trust Securities. The Depositor, on behalf of
the Trust and pursuant to the Original Trust Agreement, executed and delivered
the Underwriting Agreement. Contemporaneously with the execution and delivery of
this Trust Agreement, the Administrative Trustee, on behalf of the Trust, shall
execute in accordance with Section 5.02 and deliver to the Underwriters named in
the Underwriting Agreement one or more Book-Entry Preferred Securities
Certificates, registered in the name of the nominee of the initial Clearing
Agency, representing 3,800,000 Preferred Securities having an aggregate
Liquidation Amount of $95,000,000, against receipt by the Property Trustee of
the aggregate purchase price of such Preferred Securities of $95,000,000, which
amount the Administrative Trustee shall promptly deliver to the Property
Trustee. Contemporaneously therewith, the Administrative Trustee, on behalf of
the Trust, shall execute in accordance with Section 5.02 and deliver to the
Depositor a Common Securities Certificate, registered in the name of the
Depositor, representing 117,526 Common Securities having an aggregate
Liquidation Amount of $2,938,150, and in satisfaction of the purchase price of
such Common Securities the Depositor shall deliver to the Property Trustee the
sum of $2,938,150.
Section 2.05. Purchase of Debentures. Contemporaneously with the execution
and delivery of this Trust Agreement (i) the
11
Administrative Trustee, on behalf of the Trust, shall purchase $97,938,150
aggregate principal amount of Debentures from the Depositor, registered in the
name of the Trust and (ii) in satisfaction of the purchase price for such
Debentures, the Property Trustee, on behalf of the Trust, shall deliver to the
Depositor the sum of $97,938,150.
Section 2.06. Declaration of Trust. The exclusive purposes and functions of
the Trust are (a) to issue and sell Trust Securities and use the proceeds from
such sale to acquire the Debentures, (b) to maintain the status of the Trust as
a grantor trust for United States Federal income tax purposes, and (c) except as
otherwise limited herein, to engage in only those activities necessary,
convenient or incidental thereto. The Depositor hereby appoints the Trustees as
trustees of the Trust, to have all the rights, powers and duties to the extent
set forth herein, and the Trustees hereby accept such appointment. The Property
Trustee hereby declares that it will hold the Trust Property in trust upon and
subject to the conditions set forth herein for the benefit of the
Securityholders. The Administrative Trustee shall have all rights, powers and
duties set forth herein. The Delaware Trustee shall not be entitled to exercise
any powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Property Trustee or the Administrative Trustee set forth
herein. The Delaware Trustee shall be one of the Trustees of the Trust for the
sole and limited purpose of fulfilling the requirements of Section 3807 of the
Delaware Business Trust Act.
Section 2.07. Authorization to Enter into Certain Transactions.
(a) The Trustees shall conduct the affairs of the Trust in accordance with
the terms of this Trust Agreement. Subject to the limitations set forth in
paragraph (b) of this Section, and in accordance with the following provisions
(i) and (ii), the Trustees shall have the authority to enter into all
transactions and agreements determined by the Trustees to be appropriate in
exercising the authority, express or implied, otherwise granted to the Trustees
under this Trust Agreement, and to perform all acts in furtherance thereof,
including without limitation, the following:
(i) As among the Trustees, the Administrative Trustee shall have the
power and authority to act on behalf of the Trust with respect to the
following matters:
(A) executing and delivering the Trust Securities on behalf of
the Trust;
(B) causing the Trust to enter into, and
12
executing, delivering and performing on behalf of the Trust, the
Certificate Depository Agreement and such other agreements as may be
necessary or desirable in connection with the purposes and function of
the Trust, including the appointment of a successor depositary;
(C) assisting in registering the Preferred Securities under the
Securities Act of 1933, as amended, and under state securities or blue
sky laws, and qualifying this Trust Agreement as a trust indenture
under the Trust Indenture Act;
(D) assisting in the listing of the Preferred Securities upon
such securities exchange or exchanges as the Depositor shall determine
and the registration of the Preferred Securities under the Securities
Exchange Act of 1934, as amended, and the preparation and filing of
all periodic and other reports and other documents pursuant to the
foregoing;
(E) to the extent provided in this Trust Agreement, terminating
and liquidating the Trust and preparing, executing and filing the
certificate of cancellation with the Secretary of State of the State
of Delaware;
(F) sending notices or assisting the Property Trustee in sending
notices and other information regarding the Trust Securities and the
Debentures to Securityholders in accordance with this Trust Agreement;
and
(G) taking any action incidental to the foregoing as the
Administrative Trustee may from time to time determine is necessary or
advisable to give effect to the terms of this Trust Agreement for the
benefit of the Securityholders (without consideration of the effect of
any such action on any particular Securityholder).
(ii) As among the Trustees, the Property Trustee shall have the power,
duty and authority to act on behalf of the Trust with respect to the
following matters:
(A) establishing and maintaining the Payment Account and
appointing Paying Agents (subject to Section 5.09);
(B) receiving payment of the purchase price of the Trust
Securities;
(C) receiving and holding the Debentures;
(D) collecting interest and principal payments on the Debentures
and depositing them in the Payment Account;
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(E) making Distributions and other payments to the
Securityholders in respect of the Trust Securities;
(F) exercising all of the rights, powers and privileges of a
holder of the Debentures;
(G) sending notices of defaults, redemptions, Extension Periods,
liquidations and other information regarding the Trust Securities and
the Debentures to the Securityholders in accordance with this Trust
Agreement;
(H) to the extent provided in this Trust Agreement, terminating
and liquidating the Trust, including distributing the Trust Property
in accordance with the terms of this Trust Agreement, and preparing,
executing and filing the certificate of cancellation with the
Secretary of State of the State of Delaware;
(I) after an Event of Default, taking any action incidental to
the foregoing as the Property Trustee may from time to time determine
is necessary or advisable to give effect to the terms of this Trust
Agreement and protect and conserve the Trust Property for the benefit
of the Securityholders (without consideration of the effect of any
such action on any particular Securityholder); and
(J) registering transfers and exchanges of the Preferred
Securities in accordance with this Trust Agreement (but only if at
such time the Property Trustee shall be the Securities Registrar).
(b) So long as this Trust Agreement remains in effect, the Trust (or the
Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees acting on behalf of the Trust shall not (i)
acquire any assets or investments (other than the Debentures), reinvest the
proceeds derived from investments, possess any power or otherwise act in such a
way as to vary the Trust Property or engage in any activities not authorized by
this Trust Agreement, (ii) sell, assign, transfer, exchange, mortgage, pledge,
set-off or otherwise dispose of any of the Trust Property or interests therein,
including to Securityholders, except as expressly provided herein, (iii) take
any action that would cause the Trust to fail or cease to qualify as a grantor
trust for United States Federal income tax purposes, (iv) incur any indebtedness
for borrowed money or issue any other debt, (v) issue any securities or other
evidences of beneficial ownership of, or beneficial interests in, the Trust
other than the Trust Securities, or (vi) take or consent to any
14
action that would result in the placement of a Lien on any of the Trust
Property. The Administrative Trustee shall defend all claims and demands of all
Persons at any time claiming any Lien on any of the Trust Property adverse to
the interest of the Trust or the Securityholders in their capacity as
Securityholders.
(c) In connection with the issue and sale of the Preferred Securities, the
Depositor shall have the right and responsibility to assist the Trust with
respect to, or effect on behalf of the Trust, the following (and any actions
taken by the Depositor in furtherance of the following prior to the date of this
Trust Agreement are hereby ratified and confirmed in all respects):
(i) preparing for filing with the Commission and executing on behalf
of the Trust a registration statement on Form S-3 in relation to the
Preferred Securities, including any amendments thereto;
(ii) determining the States in which to take appropriate action to
qualify or register for sale all or part of the Preferred Securities and
doing any and all such acts, other than actions which must be taken by or
on behalf of the Trust, and advising the Trustees of actions they must take
on behalf of the Trust, and preparing for execution and filing any
documents to be executed and filed by the Trust or on behalf of the Trust,
as the Depositor deems necessary or advisable in order to comply with the
applicable laws of any such States;
(iii) preparing for filing and executing on behalf of the Trust an
application to the New York Stock Exchange or any other national stock
exchange or The Nasdaq National Market for listing upon notice of issuance
of any Preferred Securities;
(iv) preparing for filing with the Commission and executing on behalf
of the Trust a registration statement on Form 8-A relating to the
registration of the Preferred Securities under Section 12(b) or 12(g) of
the Securities Exchange Act of 1934, as amended, including any amendments
thereto;
(v) negotiating the terms of, and executing and delivering, the
Underwriting Agreement providing for the sale of the Preferred Securities;
and
(vi) taking any other actions necessary or desirable to carry out any
of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the Administrative
Trustee is authorized and directed to conduct the affairs of the Trust and to
operate the Trust so that (i) the Trust
15
will not be deemed to be an "investment company" required to be registered under
the 1940 Act, or taxed as a corporation or a partnership for United States
Federal income tax purposes (ii) the Trust will qualify as a grantor trust for
United States Federal income tax purposes and (iii) the Debentures will be
treated as indebtedness of the Depositor for United States Federal income tax
purposes. In this connection, the Depositor and the Administrative Trustee are
authorized to take any action, not inconsistent with applicable law, the
Certificate of Trust, as amended from time to time, or this Trust Agreement,
that each of the Depositor and the Administrative Trustee determines in their
discretion to be necessary or desirable for such purposes.
Section 2.08. Assets of Trust. The assets of the Trust shall consist of the
Trust Property.
Section 2.09. Title to Trust Property. Legal title to all Trust Property
shall be vested at all times in the Property Trustee (in its capacity as such)
and shall be held and administered by the Property Trustee for the benefit of
the Securityholders in accordance with this Trust Agreement.
ARTICLE III
Payment Account
Section 3.01. Payment Account.
(a) On or prior to the Closing Date, the Property Trustee shall establish
the Payment Account. All monies and other property deposited or held from time
to time in the Payment Account shall be held by the Property Trustee for the
exclusive benefit of the Securityholders. The Property Trustee shall have
exclusive control of the Payment Account for the purpose of making deposits in
and withdrawals from the Payment Account in accordance with this Trust
Agreement; provided that any Paying Agent shall have the right of withdrawal
with respect to the Payment Account solely for the purpose of making the
payments contemplated under Article 4.
(b) The Property Trustee shall deposit in the Payment Account, promptly
upon receipt, all payments of principal of or interest on the Debentures and any
amounts paid to the Property Trustee pursuant to the Guarantee. Amounts held in
the Payment Account shall not be invested pending distribution thereof.
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ARTICLE IV
Distributions; Redemption
Section 4.01. Distributions.
(a) Distributions on the Trust Securities shall be cumulative, and will
accumulate whether or not there are funds of the Trust available for the payment
of Distributions. Distributions shall accumulate from February 7, 1997 and,
except during an Extension Period for the Debentures pursuant to the Indenture,
shall be payable quarterly in arrears on March 31, June 30, September 30 and
December 31 of each year, commencing on March 31, 1997. If any date on which
Distributions are otherwise payable on the Trust Securities is not a Business
Date then the payment of such Distributions shall be made on the next succeeding
day which is a Business Day (and without any interest or other payment in
respect of any such delay), except that, if such Business Day is in the next
succeeding calendar year, payment of such Distributions shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date (each date on which Distributions are payable in
accordance with this Section 4.01(a) is referred to as a "Distribution Date").
Within two Business Days after receipt by the Property Trustee of notice of
an Extension Period pursuant to Section 4.01 of the Indenture, the Property
Trustee shall give notice thereof to the Securityholders by first class mail,
postage prepaid.
(b) The Trust Securities represent undivided beneficial interests in the
Trust Property, and, subject to Sections 4.03 and 4.06 hereof, all Distributions
will be made pro rata on each of the Trust Securities. Distributions on the
Trust Securities shall be payable at a rate of 8.125% per annum of the
Liquidation Amount of the Trust Securities. The amount of Distributions payable
for any full quarterly period shall be computed on the basis of a 360-day year
of twelve 30-day months. During an Extension Period for the Debentures, the rate
per annum at which Distributions on the Trust Securities accumulate shall be
increased by an amount such that the aggregate amount of Distributions that
accumulate on all Trust Securities during any such Extension Period is equal to
the aggregate amount of interest (including interest payable on unpaid interest
at the rate per annum set forth above, compounded quarterly) that accrues during
any such Extension Period on the Debentures.
(c) Distributions on the Trust Securities shall be made from the Payment
Account by the Property Trustee or any Paying
17
Agent and shall be payable on each Distribution Date only to the extent that the
Trust has funds then available in the Payment Account for the payment of such
Distributions.
(d) Distributions on the Trust Securities on each Distribution Date shall
be payable to the Holders thereof as they appear on the Securities Register for
the Trust Securities on the relevant record date, which shall be one Business
Day prior to such Distribution Date; provided, however, that in the event that
the Preferred Securities are not in book-entry-only form, the relevant record
date shall be the 15th day of the last month of each calendar quarter, whether
or not a Business Day.
Section 4.02. Redemption.
(a) Upon receipt by the Trust of a notice of redemption of Debentures, the
Trust will call for redemption a Like Amount of Trust Securities at the
Redemption Price on the Debenture Redemption Date and will call for redemption
all Outstanding Trust Securities on the stated maturity date of the Debentures.
(b) Notice of redemption shall be given by the Property Trustee by
first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date to each Holder of Trust Securities to be redeemed,
at such Holder's address appearing in the Securities Register. All notices of
redemption shall state:
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(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) the place or places where Trust Securities Certificates are to be
surrendered for payment of the Redemption Price;
(v) that on the Redemption Date the Redemption Price will become
payable upon each such Trust Security to be redeemed and that Distributions
thereon will cease to accumulate on and after such date; and
(vi) if less than all of the Outstanding Trust Securities are to be
redeemed, the identification and total Liquidation Amount of the particular
Trust Securities to be redeemed.
(c) The Trust Securities redeemed on each Redemption Date shall be redeemed
at the Redemption Price with the proceeds from the contemporaneous redemption or
payment at maturity of Debentures. Redemptions of the Trust Securities shall be
made and the Redemption Price shall be payable on each Redemption Date only to
the extent that the Trust has funds then available in the Payment Account for
the payment of such Redemption Price.
(d) If the Trust, by action of the Property Trustee, gives a notice of
redemption in respect of any Preferred Securities, then, on the Redemption Date,
subject to Section 4.02(c), the Property Trustee will irrevocably deposit with
the Paying Agent funds sufficient to pay the Redemption Price for the Preferred
Securities being redeemed on such date and will give the Paying Agent
irrevocable instructions and authority to pay the Redemption Price to the
Holders of such Preferred Securities upon surrender of their Preferred
Securities Certificates. Notwithstanding the foregoing, Distributions payable on
or prior to the Redemption Date for any Trust Securities called for redemption
shall be payable to the Holders of such Trust Securities as they appear on the
Securities Register for the Trust Securities on the record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
irrevocably deposited as required, then upon the date of such deposit, all
rights of Securityholders holding Trust Securities so called for redemption will
cease, except the right of such Securityholders to receive the Redemption Price,
but without interest, and such Trust Securities will cease to be Outstanding. In
the event that any date on which any Redemption Price is payable is not a
Business Day, then payment
19
of the Redemption Price payable on such date will be made on the next succeeding
day which is a Business Day (and without any interest or other payment in
respect of any such delay), except that, if such Business Day is in the next
succeeding calendar year, such payment will be made on the immediately preceding
Business Day, in each case, with the same force and effect as if made on such
date. In the event that payment of the Redemption Price in respect of any Trust
Securities called for redemption is improperly withheld or refused, and not paid
either by the Trust or by the Depositor pursuant to the Guarantee, Distributions
on such Trust Securities will continue to accumulate, at the then applicable
rate, from the Redemption Date originally established by the Trust for such
Trust Securities to the date such Redemption Price is actually paid, in which
case the actual payment date will be the date fixed for redemption for purposes
of calculating the Redemption Price.
(e) If less than all the Outstanding Trust Securities are to be redeemed on
a Redemption Date, then the aggregate Liquidation Amount of Trust Securities to
be redeemed shall be allocated 3% to the Common Securities and 97% to the
Preferred Securities. The particular Preferred Securities to be redeemed shall
be selected by the Property Trustee from the Outstanding Preferred Securities
not previously called for redemption, by such method as the Property Trustee
shall deem fair and appropriate. The Property Trustee shall promptly notify the
Securities Registrar in writing of the Preferred Securities selected for
redemption. If fewer than all of the Trust Securities represented by a Trust
Securities Certificate are redeemed, the Administrative Trustee shall execute
for the Holder a new Trust Securities Certificate representing the unredeemed
Trust Securities. For all purposes of this Trust Agreement, unless the context
otherwise requires, all provisions relating to the redemption of Preferred
Securities shall relate, in the case of any Preferred Securities redeemed or to
be redeemed only in part, to the portion of the Liquidation Amount of Preferred
Securities which has been or is to be redeemed.
Section 4.03. Subordination of Common Securities.
(a) Payment of Distributions on, and the Redemption Price of, the Trust
Securities, as applicable, shall be made pro rata based on the Liquidation
Amount of the Trust Securities; provided, however, that if on any Distribution
Date or Redemption Date, a Debenture Event of Default shall have occurred and be
continuing, no payment of any Distribution on, or Redemption Price of, any
Common Security, and no other payment on account of the liquidation of Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions on all Outstanding Preferred Securities for all
distribution periods terminating on or prior thereto, or in the case of payment
of the Redemption Price, the full amount of such Redemption Price on all
Outstanding Preferred Securities then being redeemed, shall have
20
been made or provided for, and all funds immediately available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions on, or the Redemption Price of, Preferred Securities then due and
payable.
(b) In the case of the occurrence of any Debenture Event of Default, the
Holder of Common Securities will be deemed to have waived any right to act with
respect to any related Event of Default under this Trust Agreement and such
Debenture Event of Default until the effect of such related Event of Default and
such Debenture Event of Default has been cured, waived or otherwise eliminated.
Until any such Event of Default under this Trust Agreement and such Debenture
Event of Default has been so cured, waived or otherwise eliminated, the Property
Trustee shall act solely on behalf of the Holders of the Preferred Securities
and not the Holder of the Common Securities, and only the Holders of the
Preferred Securities will have the right to direct the Property Trustee to act
on their behalf.
Section 4.04. Payment Procedures. Payments of Distributions pursuant to
Section 4.01 in respect of the Preferred Securities shall be made by check
mailed to the address of the Holder thereof as such address shall appear on the
Securities Register or, if the Preferred Securities are held by a Clearing
Agency, such Distributions shall be made to the Clearing Agency by wire transfer
in immediately available funds. Payments of Distributions pursuant to Section
4.01 in respect of the Common Securities shall be made in such manner as shall
be mutually agreed between the Property Trustee and the Holder of the Common
Securities. Payment of the Redemption Price or Liquidation Distribution of the
Trust Securities shall be made in immediately available funds upon surrender of
the Preferred Securities Certificate representing such Preferred Securities at
the Corporate Trust Office of the Property Trustee.
Section 4.05. Tax Returns and Reports. The Administrative Trustee shall
prepare (or cause to be prepared), at the Depositor's expense, and file all
Federal, State and local tax and information returns and reports required to be
filed by or in respect of the Trust. In this regard, the Administrative Trustee
shall (a) prepare and file (or cause to be prepared or filed) the appropriate
Internal Revenue Service Form required to be filed in respect of the Trust in
each taxable year of the Trust and (b) prepare and furnish (or cause to be
prepared and furnished) to each Securityholder the related Internal Revenue
Service Form 1099 OID, or any successor form or the information required to be
provided on such form. The Administrative Trustee shall provide the Depositor
and the Property Trustee with a copy of all such returns, reports and schedules
promptly after such filing or furnishing. The
21
Trustees shall comply with United States Federal withholding and backup
withholding tax laws and information reporting requirements with respect to any
payments to Securityholders under the Trust Securities.
Section 4.06. Payments under Indenture. Any amount payable hereunder to any
Holder of Preferred Securities shall be reduced by the amount of any
corresponding payment such Holder has directly received pursuant to Section 6.07
of the Indenture or pursuant to the Guarantee. Notwithstanding the provisions
hereunder to the contrary, Securityholders acknowledge that any Holder of
Preferred Securities that receives payment under Section 6.07 of the Indenture
may receive amounts greater than the amount such Holder may be entitled to
receive pursuant to the other provisions of this Trust Agreement.
ARTICLE V
Trust Securities Certificates
Section 5.01. Initial Ownership. Upon the creation of the Trust and the
contribution by the Depositor pursuant to Section 2.03 and until the issuance of
the Trust Securities, and at any time during which no Trust Securities are
outstanding, the Depositor shall be the sole beneficial owner of the Trust.
Section 5.02. The Trust Securities Certificates. The Trust Securities
Certificates shall be issued representing one or more Preferred Securities.
Preferred Securities Certificates representing fractional interests shall not be
issued. The Trust Securities Certificates shall be executed on behalf of the
Trust by manual signature of the Administrative Trustee or by a facsimile
signature of the Administrative Trustee countersigned by the Securities
Registrar. Trust Securities Certificates bearing the manual signatures of
individuals who were, at the time when such signatures shall have been affixed,
authorized to sign on behalf of the Trust, shall be validly issued and entitled
to the benefits of this Trust Agreement, notwithstanding that such individuals
or any of them shall have ceased to be so authorized prior to the delivery of
such Trust Securities Certificates or did not hold such offices at the date of
delivery of such Trust Securities Certificates. A transferee of a Trust
Securities Certificate shall become a Securityholder, and shall be entitled to
the rights and subject to the obligations of a Securityholder hereunder, upon
due registration of such Trust Securities Certificate in such transferee's name
pursuant to Section 5.04.
Section 5.03. Delivery of Trust Securities Certificates.
22
On the Closing Date, the Administrative Trustee shall cause Trust Securities
Certificates, in an aggregate Liquidation Amount as provided in Sections 2.04
and 2.05, to be executed on behalf of the Trust as provided in Section 5.02 and
delivered to or upon a written order of the Depositor signed by its Chairman of
the Board, its President, any Vice President or the Treasurer, without further
corporate action by the Depositor, in authorized denominations. The written
order of the Depositor shall be accompanied by an Officer's Certificate and an
Opinion of Counsel.
Section 5.04. Registration of Transfer and Exchange of Preferred Securities
Certificates. A registrar appointed by the Depositor (the "Securities
Registrar") shall keep or cause to be kept, at the office or agency maintained
pursuant to Section 5.08, a register (the "Securities Register") in which,
subject to such reasonable regulations as it may prescribe, the Securities
Registrar shall provide for the registration of Trust Securities Certificates
(subject to Section 5.10 in the case of the Common Securities Certificates) and
registration of transfers and exchanges of Preferred Securities Certificates as
herein provided. The Property Trustee shall be the initial Securities Registrar;
any successor Securities Registrar shall be appointed by the Administrative
Trustee.
Upon surrender for registration of transfer of any Preferred Securities
Certificate at the office or agency maintained pursuant to Section 5.08, the
Administrative Trustee shall execute and deliver, in the name of the designated
transferee or transferees, one or more new Preferred Securities Certificates
representing the same number of Preferred Securities dated the date of execution
by the Administrative Trustee. At the option of a Holder, Preferred Securities
Certificates may be exchanged for other Preferred Securities Certificates upon
surrender of the Preferred Securities Certificates to be exchanged at the office
or agency maintained pursuant to Section 5.08. The Securities Registrar shall
not be required to register the transfer of any Preferred Securities that have
been called for redemption or after the Liquidation Date.
Preferred Securities presented or surrendered for registration of transfer
or exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Administrative Trustee and the Securities Registrar duly
executed by the Holder or such Holder's attorney duly authorized in writing.
Each Preferred Securities Certificate surrendered for registration of transfer
or exchange shall be cancelled and subsequently disposed of by the Property
Trustee in accordance with its customary practice.
23
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities, but the Securities Registrar may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer or exchange of Preferred Securities.
Section 5.05. Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates. If (a) any mutilated Trust Securities Certificate shall be
surrendered to the Securities Registrar, or if the Securities Registrar shall
receive evidence to its satisfaction of the destruction, loss or theft of any
Trust Securities Certificate, and (b) there shall be delivered to the Securities
Registrar and the Administrative Trustee such security or indemnity as may be
required by them to hold the Securities Registrar and the Trust harmless, then
in the absence of notice that such Trust Securities Certificate shall have been
acquired by a bona fide purchaser, the Administrative Trustee, on behalf of the
Trust shall execute and make available for delivery, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a
new Trust Securities Certificate of like tenor. In connection with the issuance
of any new Trust Securities Certificate under this Section, the Administrative
Trustee or the Securities Registrar may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Trust Securities Certificate issued pursuant to this
Section shall constitute conclusive evidence of an undivided beneficial interest
in the assets of the Trust, as if originally issued, whether or not the lost,
stolen or destroyed Trust Securities Certificate shall be found at any time.
Section 5.06. Persons Deemed Securityholders. Prior to due presentation of
a Trust Security Certificate for registration of transfer, the Administrative
Trustee or the Securities Registrar shall treat the Person in whose name any
Trust Securities Certificate shall be registered in the Securities Register as
the owner and Holder of such Trust Securities Certificate for the purpose of
receiving Distributions and for all other purposes whatsoever, and neither the
Trustees nor the Securities Registrar shall be bound by any notice to the
contrary.
Section 5.07. Access to List of Securityholders' Names and Addresses. In
the event that the Property Trustee is no longer the Securities Registrar, the
Administrative Trustee or the Depositor shall furnish or cause to be furnished
(a) to the Property Trustee, quarterly not later than 10 days prior to a
Distribution Date, a list, in such form as the Property Trustee may reasonably
require, of the names and addresses of the Securityholders as of the most recent
record date and (b) to the Property Trustee, promptly after receipt by the
Administrative
24
Trustee or the Depositor of a request therefor from the Property Trustee in
order to enable the Paying Agent to pay Distributions in accordance with Section
4.01 hereof), in each case to the extent such information is in the possession
or control of the Administrative Trustee or the Depositor and is not identical
to a previously supplied list or has not otherwise been received by the Property
Trustee. The rights of Securityholders to communicate with other Securityholders
with respect to their rights under this Trust Agreement or under the Trust
Securities, and the corresponding rights of the Property Trustee shall be as
provided in the Trust Indenture Act. Each Holder, by receiving and holding a
Trust Securities Certificate, shall be deemed to have agreed not to hold the
Depositor, the Property Trustee, the Administrative Trustee or the Delaware
Trustee accountable by reason of the disclosure of its name and address,
regardless of the source from which such information was derived.
Section 5.08. Maintenance of Office or Agency. The Property Trustee shall
maintain in Newark, New Jersey, an office or offices or agency or agencies where
Preferred Securities may be surrendered for registration of transfer or exchange
and where notices and demands to or upon the Trustees in respect of the Trust
Securities Certificates may be served. The Property Trustee shall give prompt
written notice to the Depositor and to the Securityholders of any change in the
location of the Securities Register or any such office or agency, which shall
initially be at the Corporate Trust Office of the Property Trustee.
Section 5.09. Appointment of Paying Agent. The Paying Agent shall make
Distributions to Securityholders from the Payment Account and shall report the
amounts of such Distributions to the Property Trustee and the Administrative
Trustee. Any Paying Agent shall have the revocable power to withdraw funds from
the Payment Account for the purpose of making Distributions. The Administrative
Trustee may revoke such power and remove the Paying Agent, provided that such
revocation and removal with respect to the sole Paying Agent shall not become
effective until the appointment of a successor. The Paying Agent shall initially
be the Property Trustee, and any co-paying agent chosen by the Property Trustee
and acceptable to the Administrative Trustee and the Depositor. Any Person
acting as Paying Agent shall be permitted to resign as Paying Agent upon 30
days' written notice to the Administrative Trustee and the Depositor, and, if
applicable, the Property Trustee, provided that such resignation with respect to
the sole Paying Agent shall not become effective until the appointment of a
successor. In the event that the Property Trustee shall no longer be the Paying
Agent or a successor Paying Agent shall resign or its authority to act be
revoked, the Administrative Trustee shall appoint a successor that is acceptable
to the
25
Property Trustee (in the case of any other Paying Agent) and the Depositor to
act as Paying Agent (which shall be a bank or trust company and have a combined
capital and surplus of at least $50,000,000). The Administrative Trustee shall
cause such successor Paying Agent or any additional Paying Agent appointed by
the Administrative Trustee to execute and deliver to the Trustees an instrument
in which such successor Paying Agent or additional Paying Agent shall agree with
the Trustees that as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for payment to the
Securityholders in trust for the benefit of the Securityholders entitled thereto
until such sums shall be paid to such Securityholders. The Paying Agent shall
return all of such sums remaining unclaimed to the Property Trustee and upon
removal of a Paying Agent such Paying Agent shall also return such sums in its
possession to the Property Trustee. The provisions of Sections 7.01, 7.03 and
7.06 shall apply to the Property Trustee also in its role as Paying Agent, for
so long as the Property Trustee shall act as Paying Agent and, to the extent
applicable, to any other Paying Agent appointed hereunder. Any reference in this
Trust Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
Section 5.10. No Transfer of Common Securities by Depositor. To the fullest
extent permitted by law, any attempted transfer of the Common Securities shall
be void. The Administrative Trustee shall cause each Common Securities
Certificate issued to the Depositor to contain a legend stating "THIS
CERTIFICATE IS NOT TRANSFERABLE". By execution of this Trust Agreement, the
Depositor agrees to the foregoing provisions.
Section 5.11. Book-Entry Preferred Securities Certificates; Common
Securities Certificate.
(a) The Preferred Securities, upon original issuance on the Closing Date,
will not be engraved but will be issued in the form of one or more printed or
typewritten Book-Entry Preferred Securities Certificates, to be delivered to The
Depository Trust Company, the initial Clearing Agency, by, or on behalf of, the
Trust. Such Book-Entry Preferred Securities Certificate or Certificates shall
initially be registered on the Securities Register in the name of Cede & Co.,
the nominee of the initial Clearing Agency.
(b) A single Common Securities Certificate representing the Common
Securities shall be issued to the Depositor in the form of a definitive Common
Securities Certificate.
Section 5.12. Definitive Preferred Securities Certificates. If (a) the
Depositor advises the Trustees in writing
26
that the Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Preferred Securities Certificates or the
Clearing Agency is no longer registered or in good standing under the Securities
Exchange Act of 1934, as amended, or other applicable statute or regulation, and
the Depositor is unable to locate a qualified successor within 90 days, (b) the
Depositor at its option advises the Trustees in writing that it elects to
terminate the book-entry system through the Clearing Agency or (c) an Event of
Default occurs and is continuing, then the Administrative Trustee shall issue
Definitive Preferred Securities Certificates. Upon surrender to the
Administrative Trustee of the Book-Entry Preferred Securities Certificates by
the Clearing Agency, accompanied by registration instructions, the
Administrative Trustee shall execute and deliver the Definitive Preferred
Securities Certificates in accordance with the instructions of the Clearing
Agency. Neither the Securities Registrar nor the Trustees shall be liable for
any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. The Definitive Preferred
Securities Certificates shall be printed, lithographed or engraved or may be
produced in any other manner as is reasonably acceptable to the Administrative
Trustee, as evidenced by the execution thereof by the Administrative Trustee.
Section 5.13. Rights of Securityholders. The Securityholders shall not have
any right or title to the Trust Property other than the undivided beneficial
interest in the assets of the Trust conferred by their Trust Securities and they
shall have no right to call for any partition or division of property, profits
or rights of the Trust except as described below. The Trust Securities shall be
personal property giving only the rights specifically set forth therein and in
this Trust Agreement. The Trust Securities shall have no preemptive or similar
rights and when issued and delivered to Securityholders against payment of the
purchase price therefor will be fully paid and nonassessable by the Trust. The
Holders of the Trust Securities, in their capacities as such, shall be entitled
to the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
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ARTICLE VI
Acts of Securityholders; Meetings; Voting
Section 6.01. Limitations on Voting Rights.
(a) Except as provided herein and in the Indenture and as otherwise
required by law, no Holder of Trust Securities shall have any right to vote or
in any manner otherwise control the administration, operation and management of
the Trust or the obligations of the parties hereto, nor shall anything herein
set forth, or contained in the terms of the Trust Securities Certificates, be
construed so as to constitute the Securityholders from time to time as partners
or members of an association.
(b) 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 the Debenture Trustee with respect to
such Debentures, (ii) waive any past default which may be waived under Section
6.04 of the Indenture, (iii) exercise any right to rescind or annul an
acceleration of the principal of all the Debentures or (iv) consent to any
amendment or modification of the Indenture, where such consent shall be
required, without, in each case, obtaining the prior consent of the Holders of
at least a majority in aggregate Liquidation Amount of all Outstanding Preferred
Securities; provided, however, that where such consent under the Indenture would
require the consent of each holder of Debentures affected thereby, no such
consent shall be given by the Property Trustee without the prior written consent
of each Holder of Outstanding Preferred Securities. The Trustees shall not
revoke any action previously authorized or approved by a vote of the Holders of
Preferred Securities, except by a subsequent vote of the Holders of Preferred
Securities. The Property Trustee shall notify all Holders of the Preferred
Securities of any notice received from the Debenture Trustee as a result of the
Trust being the holder of the Debentures. In addition to obtaining the consent
of the Holders of the Preferred Securities, prior to taking any of the foregoing
actions, the Trustees shall, at the expense of the Depositor, obtain an Opinion
of Counsel experienced in such matters to the effect that the Trust will not be
classified as an association taxable as a corporation or partnership for United
States Federal income tax purposes on account of such action and will continue
to be classified as a grantor trust for United States Federal income tax
purposes.
(c) Subject to Section 10.02(c) hereof, if any proposed amendment to the
Trust Agreement provides for, or the Trustees otherwise propose to effect, (i)
any action that would adversely
28
affect in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to this Trust Agreement or
otherwise, or (ii) the termination or liquidation of the Trust, other than
pursuant to the terms of this Trust Agreement, then the Holders of Outstanding
Preferred Securities will be entitled to vote on such amendment or proposal and
such amendment or proposal shall not be effective except with the approval of
the Holders of at least a majority in aggregate Liquidation Amount of the
Outstanding Preferred Securities.
Section 6.02. Notice of Meetings. Notice of all meetings of the Preferred
Securityholders, stating the time, place and purpose of the meeting, shall be
given by the Property Trustee pursuant to Section 10.08 to each Preferred
Securityholder of record, at his/her registered address, at least 15 days and
not more than 90 days before the meeting. At any such meeting, any business
properly before the meeting may be so considered whether or not stated in the
notice of the meeting. Any adjourned meeting may be held as adjourned without
further notice.
Section 6.03. Meetings of Preferred Securityholders. No annual meeting of
Securityholders is required to be held. The Administrative Trustee, however,
shall call a meeting of Securityholders to vote on any matter upon the written
request of the Holders of at least 25% of the aggregate Liquidation Amount of
the Outstanding Preferred Securities and the Administrative Trustee or the
Property Trustee may, at any time in their discretion, call a meeting of
Preferred Securityholders to vote on any matters as to which the Preferred
Securityholders are entitled to vote.
Holders of at least 50% of the aggregate Liquidation Amount of the
Outstanding Preferred Securities, present in person or by proxy, shall
constitute a quorum at any meeting of Securityholders.
If a quorum is present at a meeting, an affirmative vote of the Holders of
at least a majority of the aggregate Liquidation Amount of the Outstanding
Preferred Securities present, either in person or by proxy, at such meeting
shall constitute the action of the Securityholders, unless this Trust Agreement
requires a greater number of affirmative votes.
Section 6.04. Voting Rights. A Securityholder shall be entitled to one vote
for each Trust Security in respect of any matter as to which such Securityholder
is entitled to vote.
Section 6.05. Proxies, etc. At any meeting of Securityholders, any
Securityholder entitled to vote thereat may vote by proxy, provided that no
proxy shall be voted at any meeting
29
unless it shall have been placed on file with the Administrative Trustee, or
with such other officer or agent of the Trust as the Administrative Trustee may
direct, for verification prior to the time at which such vote shall be taken.
Pursuant to a resolution of the Property Trustee, proxies may be solicited in
the name of the Property Trustee or one or more officers of the Property
Trustee. Only Securityholders of record shall be entitled to vote. When Trust
Securities are held jointly by several Persons, any one of them may vote at any
meeting in person or by proxy in respect of such Trust Securities, but if more
than one of them shall be present at such meeting in person or by proxy, and
such joint owners or their proxies so present disagree as to any vote to be
cast, such vote shall not be received in respect of such Trust Securities. A
proxy purporting to be executed by or on behalf of a Securityholder shall be
deemed valid unless challenged at or prior to its exercise, and the burden of
proving invalidity shall rest on the challenger. No proxy shall be valid more
than three years after its date of execution.
Section 6.06. Securityholder Action by Written Consent. Any action which
may be taken by Securityholders at a meeting may be taken without a meeting if
Holders of the proportion of the Outstanding Preferred Securities required to
approve such action shall consent to the action in writing.
Section 6.07. Record Date for Voting and Other Purposes. For the purposes
of determining the Securityholders who are entitled to notice of and to vote at
any meeting or by written consent, or for the purpose of any other action, the
Administrative Trustee may from time to time fix a date, not more than 90 days
prior to the date of any meeting of Securityholders, as a record date for the
determination of the identity of the Securityholders for such purposes.
Section 6.08. Acts of Securityholders. Any request, demand, authorization,
direction, notice, consent, waiver or other action provided or permitted by this
Trust Agreement to be given, made or taken by Securityholders may be embodied in
and evidenced by one or more instruments of substantially similar tenor signed
by such Securityholders in person or by an agent duly appointed in writing; and,
except as otherwise expressly provided herein, such action shall become
effective when such instrument or instruments are delivered to the
Administrative Trustee. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the "Act" of
the Securityholders signing such instrument or instruments. Proof of execution
of any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Trust Agreement and (subject to Section 7.02)
conclusive, if made in the
30
manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him/her the execution thereof. Where such execution
is by a signer acting in a capacity other than his/her individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his/her
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which any Trustee receiving the same deems sufficient.
The ownership of Preferred Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to take
any action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or by
one or more duly appointed agents, each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise between the Securityholders and the
Administrative Trustee or among such Securityholders or Trustees with respect to
the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder or
Trustee under this Article VI, then the determination of such matter by the
Property Trustee shall be conclusive with respect to such matter.
Section 6.09. Inspection of Records. Upon reasonable notice to the
Administrative Trustee and the Property Trustee, the records of the Trust shall
be open to inspection by Securityholders during normal business hours for any
purpose reasonably related to such Securityholder's interest as a
Securityholder.
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ARTICLE VII
The Trustees
Section 7.01. Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Trustees shall be as provided by
this Trust Agreement and, in the case of the Property Trustee, also by the Trust
Indenture Act. The Property Trustee, other than during the occurrence and
continuance of an Event of Default, undertakes to perform only such duties as
are specifically set forth in this Trust Agreement and, upon an Event of
Default, must exercise the same degree of care and skill as a prudent person
would exercise or use in the conduct of his/her own affairs. The Trustees shall
have all the privileges, rights and immunities provided by the Delaware Business
Trust Act. Notwithstanding the foregoing, no provision of this Trust Agreement
shall require the Trustees to expend or risk their own funds or otherwise incur
any financial liability in the performance of any of their duties hereunder, or
in the exercise of any of their rights or powers, if they shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Trust Agreement relating to the
conduct or affecting the liability of or affording protection to the Trustees
shall be subject to the provisions of this Section. Nothing in this Trust
Agreement shall be construed to release the Property Trustee from liability for
its own negligent action, its own negligent failure to act, or its own willful
misconduct. To the extent that, at law or in equity, the Administrative Trustee
has duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to the Securityholders, the Administrative Trustee shall not be liable
to the Trust or to any Securityholder for the Administrative Trustee's good
faith reliance on the provisions of this Trust Agreement. The provisions of this
Trust Agreement, to the extent that they restrict the duties and liabilities of
the Administrative Trustee otherwise existing at law or in equity, are agreed by
the Depositor and the Securityholders to replace such other duties and
liabilities of the Administrative Trustee.
(b) All payments made by the Property Trustee or any other Paying Agent in
respect of the Trust Securities shall be made only from the income and proceeds
from the Trust Property. Each Securityholder, by its acceptance of a Trust
Security, agrees that (i) it will look solely to the income and proceeds from
the Trust Property to the extent available for distribution to it as herein
provided and (ii) the Trustees are not personally liable to it for
32
any amount distributable in respect of any Trust Security or for any other
liability in respect of any Trust Security. This Section 7.01(b) does not limit
the liability of the Trustees expressly set forth elsewhere in this Trust
Agreement or, in the case of the Property Trustee, in the Trust Indenture Act.
Section 7.02. Notice of Defaults; Direct Action by Securityholders. Within
90 days after the occurrence of any Event of Default actually known to the
Property Trustee, the Property Trustee shall transmit, in the manner and to the
extent provided in Section 10.08, notice of such Event of Default to the
Securityholders, the Administrative Trustee and the Depositor, unless such Event
of Default shall have been cured or waived. If the Property Trustee has failed
to enforce its rights under this Trust Agreement or the Indenture to the fullest
extent permitted by law and subject to the terms of this Trust Agreement and the
Indenture, any Securityholder may institute a legal proceeding directly against
any Person to enforce the Property Trustee's rights under this Trust Agreement
or the Indenture with respect to Debentures having a principal amount equal to
the aggregate Liquidation Amount of the Preferred Securities of such
Securityholder without first instituting a legal proceeding against the Property
Trustee or any other Person. To the extent that any action under the Indenture
is entitled to be taken by the holders of at least a specified percentage of the
principal amount of the outstanding Debentures, Holders of at least the same
percentage of the Liquidation Amount of the Outstanding Preferred Securities may
also take such action in the name of the Trust if such action has not been taken
by the Property Trustee. Notwithstanding the foregoing, if a Debenture Event of
Default relating to the Depositor's failure to pay the principal of or interest
on the Debentures has occurred and is continuing thereby resulting in an Event
of Default hereunder, then each Holder of Preferred Securities may institute a
legal proceeding directly against the Depositor for enforcement of payment to
such Holder, as provided in Section 6.07 of the Indenture.
Section 7.03. Certain Rights of Property Trustee. Subject to the provisions
of Section 7.01:
(a) the Property Trustee may rely and shall be protected in acting or
refraining from acting in good faith upon any resolution, Opinion of Counsel,
certificate, written representation of a Holder or transferee, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
33
(b) if, other than during the occurrence and continuance of an Event of
Default, (i) in performing its duties under this Trust Agreement, the Property
Trustee is required to decide between alternative courses of action or (ii) in
construing any of the provisions in this Trust Agreement, the Property Trustee
finds the same ambiguous or inconsistent with any other provisions contained
herein or (iii) the Property Trustee is unsure of the application of any
provision of this Trust Agreement, then, except as to any matter as to which the
Preferred Securityholders are entitled to vote under the terms of this Trust
Agreement, the Property Trustee shall deliver a notice to the Depositor
requesting written instructions of the Depositor as to the course of action to
be taken. The Property Trustee shall take such action, or refrain from taking
such action, as the Property Trustee shall be instructed in writing to take, or
to refrain from taking, by the Depositor; provided, however, that if the
Property Trustee does not receive such instructions of the Depositor within ten
Business Days after it has delivered such notice, or such reasonably shorter
period of time set forth in such notice (which to the extent practicable shall
not be less than two Business Days), it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Trust Agreement as
it shall deem advisable and in the best interests of the Securityholders, in
which event the Property Trustee shall have no liability except for its own
negligent action, its own negligent failure to act or its own willful
misconduct;
(c) the Property Trustee may consult with counsel or other experts of its
selection and the advice or opinion of such counsel or other experts with
respect to legal matters or advice within the scope of such experts' area of
expertise shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;
(d) the Property Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Trust Agreement at the request or
direction of any of the Securityholders pursuant to this Trust Agreement, unless
such Securityholders shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(e) 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,
approval, bond, debenture, note or other evidence of indebtedness or other paper
or document, but
34
the Property Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit; and
(f) the Property Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through its agents or
attorneys 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.
Section 7.04. Not Responsible for Recitals or Issuance of Securities. The
recitals contained herein and in the Trust Securities Certificates shall be
taken as the statements of the Trust, and the Trustees do not assume any
responsibility for their correctness. The Trustees shall not be accountable for
the use or application by the Depositor of the proceeds of the Debentures.
Section 7.05. May Hold Securities. Any Trustee or any other agent of any
Trustee or the Trust, in its individual or any other capacity, may become the
owner or pledgee of Trust Securities and, subject to Sections 7.08 and 7.13 and,
except as provided in the definition of the term Outstanding in Article I, may
otherwise deal with the Trust with the same rights it would have if it were not
a Trustee or such other agent.
Section 7.06. Compensation; Indemnity; Fees. The Depositor agrees:
(a) to pay to the Trustees from time to time such compensation as shall
have been agreed in writing with the Depositor for all services rendered by them
hereunder (which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustees in accordance with any provision of this Trust
Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its own negligent action, its own negligent
failure to act or its own wilful misconduct (or, in the case of the
Administrative Trustee, any such expense, disbursement or advance as may be
attributable to his/her gross negligence); and
(c) to indemnify each of the Trustees or any predecessor Trustee for, and
to hold the Trustees harmless against, any and all loss, damage, claims,
liability, penalty or expense including taxes
35
(other than taxes based on the income of such Trustee) incurred without its own
negligent action, its own negligent failure to act or its wilful misconduct (or,
in the case of the Administrative Trustees, incurred without gross negligence or
bad faith), arising out of or in connection with the acceptance or
administration of this Trust Agreement, including the costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder.
No Trustee may claim any Lien or charge on any Trust Property as a result
of any amount due pursuant to this Section 7.06.
The provisions of this Section 7.06 shall survive the termination of this
Trust Agreement.
Section 7.07. Corporate Property Trustee Required; Eligibility of Trustees.
(a) There shall at all times be a Property Trustee hereunder. The Property
Trustee shall be a Person that is eligible pursuant to the Trust Indenture Act
to act as such and has a combined capital and surplus of at least $50,000,000.
If any such Person publishes reports of condition at least annually, pursuant to
law or to the requirements of its supervising or examining authority, then for
the purposes of this Section, the combined capital and surplus of such Person
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Property Trustee
with respect to the Trust Securities shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
(b) There shall at all times be one or more Administrative Trustees
hereunder. Each Administrative Trustee shall be either a natural person who is
at least 21 years of age or a legal entity that shall act through one or more
persons authorized to bind that entity.
(c) There shall at all times be a Delaware Trustee. The Delaware Trustee
shall either be (i) a natural person who is at least 21 years of age and a
resident of the State of Delaware or (ii) a legal entity with its principal
place of business in the State of Delaware and that otherwise meets the
requirements of applicable Delaware law that shall act through one or more
persons authorized to bind such entity.
Section 7.08. Conflicting Interests. If the Property
36
Trustee has or shall acquire a conflicting interest within the meaning of the
Trust Indenture Act, the Property Trustee shall either eliminate such interest
or resign, to the extent and in the manner provided by, and subject to the
provisions of, the Trust Indenture Act and this Trust Agreement.
Section 7.09. Co-Trustees and Separate Trustee. Unless an Event of Default
shall have occurred and be continuing, at any time or times, for the purpose of
meeting the legal requirements of the Trust Indenture Act or of any jurisdiction
in which any part of the Trust Property may at the time be located, the
Depositor and the Administrative Trustee (and if more than one Administrative
Trustee, by agreed action of the majority of such Trustees) shall have power (i)
to appoint, and upon the written request of the Administrative Trustee the
Depositor shall for such purpose join with the Administrative Trustee in the
execution, delivery, and performance of all instruments and agreements necessary
or proper to appoint one or more Persons approved by the Property Trustee either
to act as co-trustee, jointly with the Property Trustee, of all or any part of
such Trust Property, or to the extent required by law to act as separate trustee
of any such property, in either case with such powers as may be provided in the
instrument of appointment, and (ii) to vest in such Person or Persons in the
capacity aforesaid, any property, title, right or power deemed necessary or
desirable, subject to the other provisions of this Section. If the Depositor
does not join in such appointment within 15 days after the receipt by it of a
request so to do, or in case a Debenture Event of Default has occurred and is
continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section shall either be (i) a natural person who is at least 21 years of age and
a resident of the United States or (ii) a legal entity with its principal place
of business in the United States that shall act through one or more persons
authorized to bind such entity.
Should any written instrument from the Depositor be required by any
co-trustee or separate trustee so appointed for more fully confirming to such
co-trustee or separate trustee such property, title, right, or power, any and
all such instruments shall, on request, be executed, acknowledged, and delivered
by the Depositor.
Every co-trustee or separate trustee shall, to the extent permitted by law,
but to such extent only, be appointed subject to the following terms, namely:
(a) The Trust Securities shall be executed and delivered and all rights,
powers, duties, and obligations hereunder in
37
respect of the custody of securities, cash and other personal property held by,
or required to be deposited or pledged with, the Trustees specified hereunder,
shall be exercised, solely by such Trustees and not by such co-trustee or
separate trustee.
(b) The rights, powers, duties, and obligations hereby conferred or imposed
upon the Property Trustee in respect of any property covered by such appointment
shall be conferred or imposed upon and exercised or performed by the Property
Trustee or by the Property Trustee and such co-trustee or separate trustee
jointly, as shall be provided in the instrument appointing such co-trustee or
separate trustee, except to the extent that under any law of any jurisdiction in
which any particular act is to be performed, the Property Trustee shall be
incompetent or unqualified to perform such act, in which event such rights,
powers, duties and obligations shall be exercised and performed by such
co-trustee or separate trustee.
(c) The Property Trustee at any time, by an instrument in writing executed
by it, with the written concurrence of the Depositor, may accept the resignation
of or remove any co-trustee or separate trustee appointed under this Section,
and, in case an Event of Default under the Indenture has occurred and is
continuing, the Property Trustee shall have power to accept the resignation of,
or remove, any such co-trustee or separate trustee without the concurrence of
the Depositor. Upon the written request of the Property Trustee, the Depositor
shall join with the Property Trustee in the execution, delivery, and performance
of all instruments and agreements necessary or proper to effectuate such
resignation or removal. A successor to any co-trustee or separate trustee so
resigned or removed may be appointed in the manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be personally liable
by reason of any act or omission of the Property Trustee, or any other trustee
hereunder.
(e) The Property Trustee shall not be liable by reason of any act of a
co-trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee shall be deemed to
have been delivered to each such co-trustee and separate trustee.
Section 7.10. Resignation and Removal; Appointment of Successor. No
resignation or removal of any Trustee and no appointment of a successor Trustee
pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of
38
Section 7.11.
Subject to the immediately preceding paragraph, any Trustee may resign at
any time with respect to the Trust Securities by giving written notice thereof
to the Securityholders.
Unless an Event of Default shall have occurred and be continuing, any
Trustee may be removed at any time by Act of the Holder of the Common
Securities. If an Event of Default shall have occurred and be continuing, the
Property Trustee or the Delaware Trustee, or both of them, may be removed at
such time only by Act of the Holders of at least a majority in Liquidation
Amount of the Outstanding Preferred Securities, delivered to such Trustee (in
its individual capacity and on behalf of the Trust). The Administrative Trustee
may only be removed by the Holder of Common Securities at any time.
If the instrument of acceptance by the successor Trustee required by
Section 7.11 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation or removal, the Trustee may petition,
at the expense of the Depositor, any court of competent jurisdiction for the
appointment of a successor Trustee.
If any Trustee shall resign, be removed or become incapable of acting as
Trustee, or if a vacancy shall occur in the office of any Trustee for any cause,
at a time when no Event of Default shall have occurred and be continuing, the
Holder of Common Securities, by Act of the Holder of Common Securities delivered
to the retiring Trustee, shall promptly appoint a successor Trustee or Trustees
and the Trust, and the retiring Trustee shall comply with the applicable
requirements of Section 7.11. If the Property Trustee or the Delaware Trustee
shall resign, be removed or become incapable of continuing to act as the
Property Trustee or the Delaware Trustee, as the case may be, at a time when an
Event of Default has occurred and is continuing, the Holders of Preferred
Securities, by Act of the Securityholders of at least a majority in Liquidation
Amount of the Outstanding Preferred Securities delivered to the retiring
Trustee, shall promptly appoint a successor Trustee or Trustees, and such
successor Trustee shall comply with the applicable requirements of Section 7.11.
If any Administrative Trustee shall resign, be removed or become incapable of
acting as Administrative Trustee at a time when an Event of Default shall have
occurred and be continuing, the Holder of Common Securities shall appoint a
successor Administrative Trustee. If no successor Trustee shall have been so
appointed by the Holder of Common Securities or the Holders of Preferred
Securities and accepted appointment in the manner required by Section 7.11, any
Securityholder who has been a Securityholder of Trust Securities
39
for at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the appointment of a
successor Trustee.
The Property Trustee shall give notice of each resignation and each removal
of a Trustee and each appointment of a successor Trustee to all Securityholders
in the manner provided in Section 10.08 and shall give notice to the Depositor.
Each notice shall include the name of the successor Trustee and the address of
its Corporate Trust Office if it is the Property Trustee.
Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee or Delaware Trustee who is a
natural person dies or becomes, in the opinion of the Depositor, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity may
be filled by (a) the unanimous act of the remaining Administrative Trustees if
there are at least two of them or (b) otherwise by the Depositor (with the
successor in each case being a Person who satisfies the eligibility requirements
for Administrative Trustee or for the Delaware Trustee, as the case may be, set
forth in Section 7.07).
Section 7.11. Acceptance of Appointment by Successor. In case of the
appointment hereunder of a successor Trustee, the retiring Trustee and each
successor Trustee shall execute and deliver to the Trust and the retiring
Trustee an amendment hereto wherein each successor Trustee shall accept such
appointment and which (a) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each successor Trustee all
the rights, powers, trusts and duties of the retiring Trustee and (b) shall add
to or change any of the provisions of this Trust Agreement as shall be necessary
to provide for or facilitate the administration of the trusts hereunder by more
than one Trustee, it being understood that nothing herein or in such amendment
shall constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee and upon
the execution and delivery of such amendment the resignation or removal of the
retiring Trustee shall become effective to the extent provided therein and each
such successor Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Trustee and the Trust; but, on request of the Trust or any successor Trustee,
such retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all Trust Property, all proceeds thereof and money held by such retiring
Trustee hereunder.
Upon request of any such successor Trustee, the Trust
40
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts
referred to in the first or second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 7.12. Merger, Conversion, Consolidation or Succession to Business.
Any Person into which any of the Trustees may be merged or converted or with
which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which such Trustee shall be a party, or any
Person succeeding to all or substantially all the corporate trust business of
such Trustee, shall be the successor of such Trustee hereunder, provided such
Person shall be otherwise qualified and eligible under this Article, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.
Section 7.13. Preferential Collection of Claims Against Depositor or Trust.
If and when the Property Trustee or the Delaware Trustee shall be or become a
creditor (whether directly or indirectly, secured or unsecured) of the Depositor
or the Trust (or any other obligor upon the Debentures or the Trust Securities),
including under the terms of Section 7.05 hereof, the Property Trustee or the
Delaware Trustee, as the case may be, shall be subject to and shall take all
actions necessary in order to comply with the provisions of the Trust Indenture
Act regarding the collection of claims against the Depositor or Trust (or any
such other obligor).
Section 7.14. Reports by Property Trustee. The Property Trustee shall
transmit to Holders such reports concerning the Property Trustee and its actions
under this Trust Agreement as may be required pursuant to the Trust Indenture
Act at the times and in the manner provided pursuant thereto. If required by
Section 313(a) of the Trust Indenture Act, the Property Trustee shall, within 60
days after each May 31 following the date of this Trust Agreement deliver to
Holders a brief report, dated as of such May 31, which complies with the
provisions of such Section 313(a).
A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Property Trustee with each stock exchange upon which
any Preferred Securities are then listed, with the Commission and with the
Trust. The Trust will promptly notify the Property Trustee when any Preferred
Securities are listed on any stock exchange.
41
Section 7.15. Reports to the Property Trustee. The Depositor and the
Administrative Trustee on behalf of the Trust shall provide to the Property
Trustee such documents, reports and information as required by Section 314 of
the Trust Indenture Act (if any) and the compliance certificate required by
Section 314(a) of the Trust Indenture Act in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act.
Section 7.16. Evidence of Compliance with Conditions Precedent. The
Depositor and the Administrative Trustee on behalf of the Trust shall provide to
the Property Trustee evidence of compliance with the conditions precedent, if
any, provided for in this Trust Agreement that relate to any of the matters set
forth in Section 314(c) of the Trust Indenture Act.
Section 7.17. Statements Required in Officer's Certificate and Opinion of
Counsel.
Each Officer's Certificate and Opinion of Counsel with respect to
compliance with a covenant or condition provided for in this Trust Agreement
shall include:
(1) a statement that each Person making such Officer's Certificate or
Opinion of Counsel has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such Officer's
Certificate or Opinion of Counsel are based;
(3) a statement that, in the opinion of each such Person, such Person has
made such examination or investigation as is necessary to enable such Person to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement that, in the opinion of such Person, such covenant or
condition has been complied with; provided, however, that with respect to
matters of fact not involving any legal conclusion, an Opinion of Counsel may
rely on an Officer's Certificate or certificates of public officials.
Section 7.18. Number of Trustees.
(a) The number of Trustees shall be three, provided that the Holder of all
of the Common Securities by written instrument may increase and, if increased,
may decrease the number of Administrative Trustees.
42
(b) If a Trustee ceases to hold office for any reason and the number of
Administrative Trustees is not reduced pursuant to Section 7.18(a), or if the
number of Trustees is increased pursuant to Section 7.18(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 7.10.
(c) The death, resignation, retirement, removal, bankruptcy, incompetence
or incapacity to perform the duties of a Trustee shall not operate to annul the
Trust. Whenever a vacancy shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 7.10, the
Administrative Trustees in office, regardless of their number (and
notwithstanding any other provision of this Trust Agreement), shall have all the
powers granted to the Administrative Trustee and shall discharge all the duties
imposed upon the Administrative Trustees by this Trust Agreement.
Section 7.19. Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney consistent with
applicable law, delegate to any natural person over the age of 21 his/her power
for the purpose of executing any documents contemplated in Section 2.07(a),
including any registration statement or amendment thereto filed with the
Commission, or making any other governmental filing; and
(b) the Administrative Trustees shall have power to delegate from time to
time to such of their number, if there is more than one Administrative Trustee,
or to the Depositor the doing of such things and the execution of such
instruments either in the name of the Trust or the names of the Administrative
Trustees or otherwise as the Administrative Trustees may deem expedient, to the
extent such delegation is not prohibited by applicable law or contrary to the
provisions of the Trust, as set forth herein.
Section 7.20. Voting. Except as otherwise provided in this Trust Agreement,
the consent or vote of the Trustees shall be approved by not less than a
majority of the Administrative Trustees.
43
ARTICLE VIII
Termination and Liquidation
Section 8.01. Termination Upon Expiration Date. Unless earlier terminated,
the Trust shall automatically terminate on February 7, 2051 (the "Expiration
Date"), following the distribution of the Trust Property in accordance with
Section 8.04.
Section 8.02. Early Termination. The earliest to occur of any of the
following events is an "Early Termination Event":
(a) the occurrence of a Bankruptcy Event in respect of, or the dissolution
or liquidation of the Depositor or an acceleration of the maturity of the
Debentures pursuant to Section 6.02 of the Indenture;
(b) upon the election of the Depositor to liquidate the Trust and cause the
distribution of a Like Amount of Debentures to the Holders of the Trust
Securities;
(c) the redemption of all of the Trust Securities; and
(d) an order for termination of the Trust shall have been entered by a
court of competent jurisdiction.
The election of the Depositor pursuant to Section 8.02(b) shall be made by
the Depositor giving written notice to the Trustees not less than 30 days prior
to the date of distribution of the Debentures. Such notice shall specify the
date of distribution of the Debentures and shall be accompanied by an Opinion of
Counsel that such event will not be a taxable event to the Holders of the Trust
Securities for Federal income tax purposes.
Section 8.03. Termination. The respective obligations and responsibilities
of the Trustees and the Trust created and continued hereby shall terminate upon
the latest to occur of the following: (a) the distribution by the Property
Trustee to Securityholders upon the liquidation of the Trust pursuant to Section
8.04, or upon the redemption of all of the Trust Securities pursuant to Section
4.02, of all amounts required to be distributed hereunder upon the final payment
of the Trust Securities; (b) the payment of any expenses owed by the Trust; and
(c) the discharge of all administrative duties of the Administrative Trustee,
including the performance of any tax reporting obligations with respect to the
Trust or the Securityholders.
Section 8.04. Liquidation.
44
(a) If an Early Termination Event specified in clause (a), (c) or (d) of
Section 8.02 occurs or upon the Expiration Date, the Trust shall be liquidated
by the Trustees as expeditiously as the Trustees determine to be possible by
distributing, after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, to each Securityholder a Like Amount of Debentures,
subject to Section 8.04(d). If an Early Termination Event specified in clause
(b) occurs, the Trust shall be liquidated by the Trustee on the date of
distribution of the Debentures specified by the Depositor in its notice
delivered pursuant to Section 8.02. Notice of liquidation shall be given by the
Property Trustee by first-class mail, postage prepaid, mailed not later than 30
nor more than 60 days prior to the Liquidation Date to each Holder of Trust
Securities at such Holder's address appearing in the Securities Register. All
notices of liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent a Like Amount of Debentures; and
(iii) provide such information with respect to the mechanics by which
Holders may exchange Trust Securities Certificates for certificates
evidencing Debentures, or, if Section 8.04(d) applies, receive a
Liquidation Distribution, as the Administrative Trustee or the Property
Trustee shall deem appropriate.
(b) In order to effect the liquidation of the Trust and distribution of the
Debentures to Securityholders, the Property Trustee, either itself acting as
exchange agent or through the appointment of a separate exchange agent, shall
establish such procedures as it shall deem appropriate to effect the
distribution of Debentures in exchange for the Outstanding Trust Securities
Certificates.
(c) Except where Section 8.02(c) or 8.04(d) applies, on or after the
Liquidation Date, (i) the Trust Securities will no longer be deemed to be
Outstanding, (ii) certificates representing a Like Amount of Debentures will be
issued to Holders of Trust Securities Certificates, upon surrender of such
certificates to the Administrative Trustee or its agent for exchange, (iii) the
Depositor shall use its best efforts to have the Debentures listed on the New
York Stock Exchange or such other exchange as the Preferred Securities are then
listed and shall take any reasonable action necessary to effect the distribution
of the Debentures, (iv)
45
any Trust Securities Certificates not so surrendered for exchange will be deemed
to represent a Like Amount of Debentures, accruing interest at the rate provided
for in the Debentures from the last Distribution Date on which a Distribution
was made on such Trust Certificates until such certificates are so surrendered
(and until such certificates are so surrendered, no payments or interest or
principal will be made to Holders of Trust Securities Certificates with respect
to such Debentures) and (v) all rights of Securityholders holding Trust
Securities will cease, except the right of such Securityholders to receive
Debentures upon surrender of Trust Securities Certificates.
(d) In the event that, notwithstanding the other provisions of this Section
8.04, whether because of an order for termination entered by a court of
competent jurisdiction or otherwise, distribution of the Debentures in the
manner provided herein is determined by the Property Trustee not to be
practical, the Trust Property shall be liquidated, and the Trust shall be
terminated, by the Property Trustee in such manner as the Property Trustee
determines. In such event, on the date of the termination of the Trust,
Securityholders will be entitled to receive out of the assets of the Trust
available for distribution to Securityholders, after satisfaction of liabilities
to creditors of the Trust as provided by applicable law, an amount equal to the
Liquidation Amount per Trust Security plus accumulated and unpaid Distributions
thereon to the date of payment (such amount being the "Liquidation
Distribution"). If, upon any such termination, the Liquidation Distribution can
be paid only in part because the Trust has insufficient assets available to pay
in full the aggregate Liquidation Distribution, then, subject to the next
succeeding sentence, the amounts payable by the Trust on the Trust Securities
shall be paid on a pro rata basis (based upon Liquidation Amounts). The Holder
of the Common Securities will be entitled to receive Liquidation Distributions
upon any such termination pro rata (determined as aforesaid) with Holders of
Preferred Securities, except that, if a Debenture Event of Default has occurred
and is continuing, the Preferred Securities shall have a priority over the
Common Securities, and no Liquidation Distribution will be paid to the Holders
of the Common Securities unless and until receipt by all Holders of the
Preferred Securities of the entire Liquidation Distribution payable in respect
thereof.
ARTICLE IX
Mergers, Etc.
Section 9.01. Mergers, Consolidations, Amalgamations or Replacements of the
Trust. The Trust may not merge with or into,
46
consolidate, amalgamate, or be replaced by, or convey, transfer or lease its
properties and assets as an entirety or substantially as an entirety to any
corporation or other entity, except as described below. The Trust may, at the
request of the Depositor, with the consent of the Administrative Trustee and
without the consent of the Holders of the Preferred Securities, merge with or
into, consolidate, amalgamate, or be replaced by, a trust organized as such
under the laws of any State; provided, that (i) such successor entity either (a)
expressly assumes all of the obligations of the Trust with respect to the
Preferred Securities or (b) substitutes for the Preferred Securities other
securities having substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the same as the
Preferred Securities rank with respect to the payment of Distributions and
payments upon liquidation and redemption, (ii) the Depositor expressly appoints
a trustee of such successor entity possessing the same powers and duties as the
Property Trustee with respect to the Debentures, (iii) the Successor Securities
are listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or other organization on which the
Preferred Securities are then listed, (iv) such merger, consolidation,
amalgamation or replacement does not cause the Preferred Securities (including
any Successor Securities) to be downgraded by any nationally recognized
statistical rating organization, (v) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences and privileges of
the Holders of the Preferred Securities (including any Successor Securities) in
any material respect, (vi) such successor entity has a purpose substantially
similar to that of the Trust, (vii) prior to such merger, consolidation,
amalgamation or replacement, the Depositor has received an Opinion of Counsel to
the effect that (a) such merger, consolidation, amalgamation or replacement does
not adversely affect the rights, preferences and privileges of the Holders of
the Preferred Securities (including any Successor Securities) in any material
respect, and (b) following such merger, consolidation, amalgamation or
replacement, neither the Trust nor such successor entity will be required to
register as an investment company under the 1940 Act and (viii) the Depositor or
any permitted successor assignee owns all of the common securities of such
successor entity and guarantees the obligations of such successor entity under
the Successor Securities at least to the extent provided by the Guarantee and
this Trust Agreement. Notwithstanding the foregoing, the Trust shall not, except
with the consent of all Holders of the Preferred Securities, merge with or into,
consolidate, amalgamate, or be replaced by, any other entity or permit any other
entity to consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger or replacement would cause the Trust or the
successor entity not to be classified as a grantor
47
trust for United States Federal income tax purposes.
ARTICLE X
Miscellaneous Provisions
Section 10.01. Limitation of Rights of Securityholders. The death or
incapacity of any Person having an interest, beneficial or otherwise, in Trust
Securities shall not operate to terminate this Trust Agreement, nor entitle the
legal representatives or heirs of such Person or any Securityholder for such
Person, to claim an accounting, take any action or bring any proceeding in any
court for a partition or winding-up of the arrangements contemplated hereby, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
Section 10.02. Amendment.
(a) This Trust Agreement may be amended from time to time by the Trustees
and the Depositor, without the consent of any Securityholders, to cure any
ambiguity, defect or inconsistency or make any other change which does not
adversely affect in any material respect the interests of any Holder of
Preferred Securities. Any amendments of this Trust Agreement pursuant to Section
10.02(a) shall become effective when notice thereof is given to the
Securityholders.
(b) Except as provided in Section 10.02(a) and 10.02(c) hereof, any
provision of this Trust Agreement may be amended by the Trustees and the
Depositor with the consent of Holders of at least a majority of the aggregate
Liquidation Amount of the Outstanding Preferred Securities.
(c) In addition to and notwithstanding any other provision in this Trust
Agreement, without the consent of each affected Securityholder (such consent
being obtained in accordance with Section 6.03 or 6.06 hereof), this Trust
Agreement may not be amended to (i) change the amount, timing or currency of any
Distribution or Liquidation Distribution on the Trust Securities or otherwise
adversely affect the method of payment of any Distribution or Liquidation
Distribution required to be made in respect of the Trust Securities as of a
specified date; (ii) change the redemption provisions of the Trust Securities;
(iii) restrict the right of a Securityholder to institute suit for the
enforcement of any such payment contemplated in (i) or (ii) above on or after
the related date; (iv) modify the first sentence of Section 2.06 hereof; (v)
authorize or issue any beneficial interest in the Trust other than as
contemplated by this Trust Agreement as of the date
48
hereof; (vi) change the conditions precedent for the Depositor to elect to
terminate the Trust and distribute the Debentures to Holders of Preferred
Securities as set forth in Section 8.02; or (vii) affect the limited liability
of any Holder of Preferred Securities, and, notwithstanding any other provision
herein, without the unanimous consent of the Securityholders (such consent being
obtained in accordance with Section 6.03 or 6.06 hereof), paragraphs (b) and (c)
of this Section 10.02 may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
amendment to this Trust Agreement shall be made without receipt by the Trust of
an Opinion of Counsel experienced in such matters to the effect that such
amendment will not affect the Trust's status as a grantor trust for United
States Federal income tax purposes or its exemption from regulation as an
"investment company" under the 1940 Act.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor, this Trust Agreement may not be amended in
a manner which imposes any additional obligation on the Depositor.
(f) In the event that any amendment to this Trust Agreement is made, the
Administrative Trustee shall promptly provide to the Depositor a copy of such
amendment.
(g) In executing any amendment to the Trust Agreement, the Property Trustee
shall be entitled to receive, and (subject to Section 8.01) shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such amendment is authorized or permitted by this Trust Agreement. Except as
contemplated by Section 7.11, the Trustee may, but shall not be obligated to,
enter into any amendment to this Trust Agreement which affects the Trustee's own
rights, duties or immunities under this Trust Agreement or otherwise.
Section 10.03. Severability. In case any provision in this Trust Agreement
or in the Trust Securities Certificates shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 10.04. Governing Law. THIS TRUST AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF EACH OF THE SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH
RESPECT TO THIS TRUST AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE, WITHOUT
REGARD TO CONFLICT OF LAWS PRINCIPLES.
49
Section 10.05. Payments Due on Non-Business Day. If the date fixed for any
payment on any Trust Security shall be a day which is not a Business Day, then
such payment need not be made on such date but may be made on the next
succeeding day which is a Business Day (except as otherwise provided therein,
with the same force and effect as though made on the date fixed for such
payment), and no interest shall accumulate thereon for the period after such
date to the date of payment on such succeeding day.
Section 10.06. Successors and Assigns. This Trust Agreement shall be
binding upon and shall inure to the benefit of any successor to the Trust or
successor Trustee or both, including any successor by operation of law. Except
in connection with a consolidation, merger or sale involving the Depositor that
is permitted under Article V of the Indenture and pursuant to which the assignee
agrees in writing to perform the Depositor's obligations hereunder, the
Depositor shall not assign its obligations hereunder.
Section 10.07. Headings. The Article and Section headings are for
convenience only and shall not affect the construction of this Trust Agreement.
Section 10.08. Reports, Notices and Demands. Any report, notice, demand or
other communication which by any provision of this Trust Agreement is required
or permitted to be given or served to or upon any Securityholder or the
Depositor may be given or served in writing by deposit thereof, first-class
postage prepaid in the United States mail, hand delivery or facsimile
transmission, in each case, addressed, (a) in the case of a Holder of a
Preferred Security, to such Holder of a Preferred Security as such
Securityholder's name and address may appear on the Securities Register; and (b)
in the case of the Holder of a Common Security or the Depositor, to Public
Service Electric and Gas Company, 80 Park Plaza, Newark, New Jersey 07101,
Attention: Treasurer, facsimile no.: 201-596-6309. Such notice, demand or other
communication to or upon a Securityholder shall be deemed to have been
sufficiently given or made, for all purposes, upon hand delivery, mailing or
transmission.
Any notice, demand or other communication which by any provision of this
Trust Agreement is required or permitted to be given or served to or upon the
Trust, the Property Trustee or the Administrative Trustee shall be given in
writing addressed (until another address is published by the Trust) as follows:
(a) with respect to the Property Trustee to First Union National Bank, 765 Broad
Street, Newark, New Jersey 07101, Attention: Corporate Trust Office; (b) with
respect to the Delaware Trustee, to 1225 King Street, Wilmington, Delaware 19801
Attention: Corporate Trust
50
Department; and (c) with respect to the Administrative Trustee, to the address
above for notices to the Depositor, marked "Attention: Administrative Trustee of
PSE&G Capital Trust II c/o Treasurer." Such notice, demand or other
communication to or upon the Trust or the Property Trustee shall be deemed to
have been sufficiently given or made only upon actual receipt of the writing by
the Trust or the Property Trustee.
Section 10.09. Agreement Not to Petition. Each of the Trustees and the
Depositor agree for the benefit of the Securityholders that, until at least one
year and one day after the Trust has been terminated in accordance with Article
VIII, they shall not file, or join in the filing of, a petition against the
Trust under any Bankruptcy Laws or otherwise join in the commencement of any
proceeding against the Trust under any Bankruptcy Law. In the event the
Depositor or any of the Trustees takes action in violation of this Section
10.09, the Property Trustee agrees, for the benefit of Securityholders, that at
the expense of the Depositor, it shall file an answer with the bankruptcy court
or otherwise properly contest the filing of such petition by the Depositor or
any of the Trustees, as applicable, against the Trust or the commencement of
such action and raise the defense that the Depositor has agreed in writing not
to take such action and should be stopped and precluded therefrom and such other
defenses, if any, as counsel for the Property Trustee or the Trust may assert.
The provisions of this Section 10.09 shall survive the termination of this Trust
Agreement.
Section 10.10. Trust Indenture Act; Conflict with Trust Indenture Act.
(a) This Trust Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trust Agreement and shall, to
the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a trustee for
the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required to be included in this Trust Agreement by any
of the provisions of the Trust Indenture Act, such required provision shall
control. If any provision of this Trust Agreement modifies or excludes any
provision of the Trust Indenture Act which may be so modified or excluded, the
latter provision shall be deemed to apply to this Trust Agreement as so modified
or excluded, as the case may be.
(d) The application of the Trust Indenture Act to this
51
Trust Agreement shall not affect the nature of the Trust Securities as equity
securities representing undivided beneficial interests in the assets of the
Trust.
Section 10.11. Acceptance of Terms of Trust Agreement, Guarantee and
Indenture. THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST
THEREIN BY OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST
AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND
SUCH SECURITYHOLDER AND SUCH OTHERS.
PUBLIC SERVICE ELECTRIC AND GAS
COMPANY, as Depositor
By:
-----------------------------
Name:
Title:
FIRST UNION NATIONAL BANK, as
Property Trustee
By:
-----------------------------
Name:
Title:
FIRST UNION BANK OF DELAWARE,
as Delaware Trustee
By:
-----------------------------
Name:
Title:
-----------------------------,
Fred F. Saunders, as
Administrative Trustee
52
Exhibit A
CERTIFICATE OF TRUST
OF
PSE&G CAPITAL TRUST II
THIS CERTIFICATE OF TRUST of PSE&G Capital Trust II (the "Trust"), dated
April 19, 1996, is being duly executed and filed by the undersigned, as
trustees, to form a business trust under the Delaware Business Trust Act (12
Del. C.ss. 3801 et seq.).
(i) Name. The name of the business trust being formed hereby is PSE&G
Capital Trust II.
(ii) Delaware Trustee. The name and business address of the trustee of the
Trust in the State of Delaware are First Union Bank of Delaware, 1225 King
Street, Wilmington DE 19801; attn: Corporate Trust Department.
(iii) Counterparts. This Certificate of Trust may be executed in one or
more counterparts, all of which together shall constitute one and the same
instrument.
(iv) Effective Date. This Certificate of Trust shall be effective as of its
filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust, have
executed this Certificate of Trust as of the date first above written.
FIRST UNION NATIONAL BANK, as
Trustee
By:
---------------------------
Name:
Title:
FIRST UNION BANK OF DELAWARE,
as Trustee
By:
---------------------------
Name:
Title:
-----------------------------,
as Trustee
Name: Fred F. Saunders
A-1
EXHIBIT B
February _, 1997
The Depository Trust Company
55 Water Street, 49th Floor
New York, New York 10041-0099
Attention:
General Counsel's Office
Re: PSE&G Capital Trust II Preferred Securities
Ladies and Gentlemen:
The purpose of this letter is to set forth certain matters relating to the
issuance and deposit with The Depository Trust Company ("DTC") of the PSE&G
Capital Trust II _____% Cumulative Quarterly Income Preferred Securities, Series
B (the "Preferred Securities"), of PSE&G Capital Trust II, a Delaware business
trust (the "Issuer"), created pursuant to a Trust Agreement between Public
Service Electric and Gas Company ("PSE&G"), First Union National Bank, as
Property Trustee, the Delaware Trustee named therein and the Administrative
Trustee named therein. The payment of distributions on the Preferred Securities
and payments due upon liquidation of the Issuer or redemption of the Preferred
Securities are guaranteed by PSE&G, to the extent the Issuer has funds available
for the payment thereof and to the extent set forth in a Guarantee Agreement
dated February _, 1997 by PSE&G and backup undertakings relating thereto with
respect to the Preferred Securities. The Issuer proposes to sell the Preferred
Securities to certain Underwriters (the "Underwriters") pursuant to an
Underwriting Agreement dated February __, 1997 by and among the Underwriters,
the Issuer and PSE&G and the Underwriters wish to take delivery of the Preferred
Securities through DTC. First Union National Bank is acting as transfer agent
and registrar with respect to the Preferred Securities (the "Transfer Agent and
Registrar").
To induce DTC to accept the Preferred Securities as eligible for deposit at
DTC, and to act in accordance with DTC's Rules with respect to the Preferred
Securities, the Issuer and the
Transfer Agent and Registrar make the following representations to DTC:
1. Prior to the closing of the sale of the Preferred Securities to the
Underwriters, which is expected to occur on or about February _, 1997, there
shall be deposited with DTC one or more global certificates (individually and
collectively, the "Global Certificate") registered in the name of DTC's nominee,
Cede & Co., representing an aggregate of __________ Preferred Securities and
bearing the following legend:
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Issuer or
its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of DTC (and any
payment hereon is made to Cede & Co. or to such other entity as is
requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
2. The Amended and Restated Trust Agreement of the Issuer provides for the
voting by holders of the Preferred Securities under certain limited
circumstances. The Issuer shall establish a record date for such purposes and
shall, to the extent possible, give DTC notice of such record date not less than
15 calendar days in advance of such record date.
3. In the event of a stock split, conversion, recapitalization,
reorganization or any other similar transaction resulting in the cancellation of
all or any part of the Preferred Securities outstanding, the Issuer or the
Transfer Agent and Registrar shall send DTC a notice of such event at least 5
business days prior to the effective date of such event.
4. In the event of distribution on, or an offering or issuance of rights
with respect to, the Preferred Securities outstanding, the Issuer or the
Transfer Agent and Registrar shall send DTC a notice specifying: (a) the amount
of and conditions, if any, applicable to the payment of any such distribution or
any such offering or issuance of rights; (b) any applicable expiration or
deadline date or any date by which any action on the part of the holders of
Preferred Securities is required; and (c) the date any
required notice is to be mailed by or on behalf of the Issuer to holders of
Preferred Securities or published by or on behalf of the Issuer (whether by mail
or publication, the "Publication Date"). Such notice shall be sent to DTC by a
secure means (e.g., legible telecopy, registered or certified mail, overnight
delivery) in a timely manner designed to assure that such notice is in DTC's
possession no later than the close of business on the business day before the
Publication Date. The Issuer or the Transfer Agent and Registrar will forward
such notice either in a separate secure transmission for each CUSIP number or in
a secure transmission of multiple CUSIP numbers (if applicable) that includes a
manifest or list of each CUSIP number submitted in that transmission. (The party
sending such notice shall have a method to verify subsequently the use of such
means and the timeliness of such notice.) The Publication Date shall be not less
than 20 calendar days nor more than 90 calendar days prior to the payment of any
such distribution or any such offering or issuance of rights with respect to the
Preferred Securities. After establishing the amount of payment to be made on the
Preferred Securities, the Issuer or the Transfer Agent and Registrar will notify
DTC's Dividend Department of such payment 5 business days prior to payment date.
Notices to DTC's Dividend Department by telecopy shall be sent to (212)
709-1723. Such notices by mail or by any other means shall be sent to:
Manager, Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square, 22nd Floor
New York, New York 10004-2695
The Issuer or the Transfer Agent and Registrar shall confirm DTC's receipt
of such telecopy by telephoning the Dividend Department at (212) 709-1270.
5. In the event of a redemption by the Issuer of the Preferred Securities,
notice specifying the terms of the redemption and the Publication Date of such
notice shall be sent by the Issuer or the Transfer Agent and Registrar to DTC
not less than 30 calendar days prior to such event by a secure means in the
manner set forth in paragraph 4. Such redemption notice shall be sent to DTC's
Call Notification Department at (516) 227-4039 or (516) 227-4190, and receipt of
such notice shall be confirmed by telephoning (516) 227-4070. Notice by mail or
by any other means shall be sent to:
3
Call Notification Department
The Depository Trust Company
711 Stewart Avenue
Garden City, New York 11530-4719
6. In the event of any invitation to tender the Preferred Securities,
notice specifying the terms of the tender and the Publication Date of such
notice shall be sent by the Issuer or the Transfer Agent and Registrar to DTC by
a secure means and in a timely manner as described in paragraph 4. Notices to
DTC pursuant to this paragraph and notices of other corporate actions (including
mandatory tenders, exchanges and capital changes) shall be sent, unless
notification to another department is expressly provided for herein, by telecopy
to DTC's Reorganization Department at (212) 709-1093 or (212) 709-1094 and
receipt of such notice shall be confirmed by telephoning (212) 709-6884, or by
mail or any other means to:
Manager, Reorganization Department
Reorganization Window
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004-2695
7. All notices and payment advances sent to DTC shall contain the CUSIP
number or numbers of the Preferred Securities and the accompanying designation
of the Preferred Securities, which, as of the date of this letter, is "PSE&G
Capital Trust II _____% Cumulative Quarterly Income Preferred Securities, Series
B".
8. Issuer or Agent shall provide automated notification of CUSIP-level
detail for dividend payments to DTC no later than noon (Eastern Time) on the
payment date.
9. Dividend payments shall be received by Cede & Co. as nominee of DTC, or
its registered assigns in same-day funds or the equivalent no later than 2:30
p.m. (Eastern Time) on each payment date. Absent any other arrangements between
Issuer or Trustee and DTC, such funds shall be wired as follows:
The Chase Manhattan Bank
ABA 021000021
For credit to A/C The Depository Trust Company
Dividend Deposit Account 066-026776
Issuer or Agent shall provide dividend payment information to a standard
announcement service subscribed to by DTC. In the unlikely event that no such
service exists, Issuer agrees that it
4
or Agent shall provide this information directly to DTC in advance of the
dividend payment date as soon as the information is available. This information
should be conveyed directly to DTC electronically. If electronic transmission is
not available, such information should be sent by telecopy to DTC's Dividend
Department at (212) 709-1723 or (212) 709-1886, and receipt of such notices
shall be confirmed by telephoning (212) 709-1270. Notices to DTC pursuant to the
above by mail or by any other means shall be sent to:
Manager Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square, 22nd Floor
New York, NY 10004-2695
10. DTC shall receive maturity and redemption and CUSIP-level detail on the
payable date in same-day funds by 2:30 p.m. (Eastern Time). Absent any other
arrangements between Agent and DTC, such payments shall be wired as follows:
The Chase Manhattan Bank
ABA 021000021
For credit to A/C The Depository Trust Company
Redemption Account 066-027306
in accordance with existing SDFS payment procedures in the manner set forth in
DTC's SDFS Paying Agent Operating Procedures, a copy of which has previously
been furnished to Agent.
11. DTC shall receive all reorganization payments and CUSIP-level detail
resulting from corporate actions (such as tender offers or mergers) on the first
payable date in same-day funds by 2:30 p.m. (Eastern Time). Absent any other
arrangements between Agent and DTC, such payments shall be wired as follows:
The Chase Manhattan Bank
ABA 021000021
For credit to A/C The Depository Trust Company
Reorganization Account 066-027608
12. DTC may by prior written notice direct the Issuer and the Transfer
Agent and Registrar to use any other telecopy number or address of DTC as the
number or address to which notices or payments may be sent.
13. In the event of a conversion, redemption, or any other similar
transaction (e.g., tender made and accepted in response to the Issuer's or the
Transfer Agent and Registrar's
5
invitation) necessitating a reduction in the aggregate number of Preferred
Securities outstanding evidenced by a global certificate, DTC, in its
discretion: (a) may request the Issuer or the Transfer Agent and Registrar to
issue and countersign a new global certificate; or (b) may make an appropriate
notation on such global certificate indicating the date and amount of such
reduction.
14. DTC may discontinue its services as a securities depositary with
respect to the Preferred Securities at any time by giving reasonable prior
written notice to the Issuer and the Transfer Agent and Registrar (at which time
DTC will confirm with the Issuer or the Transfer Agent and Registrar the
aggregate number of Preferred Securities deposited with it) and discharging its
responsibilities with respect thereto under applicable law. Under such
circumstances, the Issuer may determine to make alternative arrangements for
book-entry settlement for the Preferred Securities, make available one or more
separate global certificates evidencing Preferred Securities to any Participant
having Preferred Securities credited to its DTC account, or issue definitive
Preferred Securities to the beneficial owners thereof, and in any such case, DTC
agrees to cooperate fully with the Issuer and the Transfer Agent and Registrar
and to return the global certificates duly endorsed for transfer as directed by
the Issuer or the Transfer Agent and Registrar, together with any other
documents of transfer reasonably requested by the Issuer or the Transfer Agent
and Registrar.
15. In the event that the Issuer determines that beneficial owners of the
global certificate(s) evidencing Preferred Securities shall be able to obtain
definitive Preferred Securities, the Issuer or the Transfer Agent and Registrar
shall notify DTC of the availability of such definitive Preferred Securities. In
such event, the Issuer or the Transfer Agent and Registrar shall issue, transfer
and exchange definitive Preferred Securities in appropriate amounts, as required
by DTC and others, and DTC agrees to cooperate fully with the Issuer and the
Transfer Agent and Registrar and to return the global certificate(s), duly
endorsed for transfer as directed by the Issuer or the Transfer Agent and
Registrar, together with any other documents of transfer reasonably requested by
the Issuer or the Transfer Agent and Registrar.
16. Issuer: (a) understands that DTC has no obligation to, and will not,
communicate to its Participants or to any person having an interest in the
Securities any information contained in the Security certificate(s); and (b)
acknowledges that neither DTC's Participants nor any person having an interest
in the Securities shall be deemed to have notice of the provisions of the
Security certificate(s) by virtue of submission of such certificate(s) to DTC.
6
17. This letter may be executed in any number of counterparts, each of
which when so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
Nothing herein shall be deemed to require the Transfer Agent and Registrar
to advance funds on behalf of the Issuer.
Very truly yours,
PSE&G CAPITAL TRUST II
(As Issuer)
By:
------------------------
Fred F. Saunders, as
Administrative Trustee
FIRST UNION NATIONAL BANK
---------------------------
(As Transfer Agent and
Registrar)
By:
------------------------
Name:
Title:
RECEIVED AND ACCEPTED:
THE DEPOSITORY TRUST COMPANY
By:
------------------------------
Authorized Officer
7
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
Certificate Number
C-1
Number of Common Securities
117,526
Certificate Evidencing Common Securities
of
PSE&G Capital Trust II
8.125% Common Securities
(liquidation amount $25 per Common Security)
PSE&G Capital Trust II, a statutory business trust created under the laws
of the State of Delaware (the "Trust"), hereby certifies that Public Service
Electric and Gas Company (the "Holder") is the registered owner of
____________________ (__________) common securities of the Trust representing
undivided beneficial interests in the assets of the Trust and designated as the
8.125% Common Securities (liquidation amount $25 per Common Security) (the
"Common Securities"). In accordance with Section 5.10 of the Trust Agreement (as
defined below) the Common Securities are not transferable and any attempted
transfer hereof shall be void. The designations, rights, privileges,
restrictions, preferences and other terms and provisions of the Common
Securities are set forth in, and this certificate and the Common Securities
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Amended and Restated Trust Agreement of the Trust dated
as of February 7, 1997, as the same may be amended from time to time (the "Trust
Agreement"). The Trust will furnish a copy of the Trust Agreement to the Holder
without charge upon written request to the Trust at its principal place of
business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Administrative Trustee of the Trust has executed
this certificate this 7th day of February, 1997.
PSE&G CAPITAL TRUST II
By:
--------------------------
Fred F. Saunders, as
Administrative Trustee
2
EXHIBIT D
Certificate Number
1
Number of Preferred Securities
CUSIP NO. __________
Certificate Evidencing Preferred Securities
of
PSE&G Capital Trust II
8.125% Cumulative Quarterly Income Preferred Securities,
Series B
(liquidation amount $25 per Preferred Security)
PSE&G Capital Trust II, a statutory business trust created under the laws
of the State of Delaware (the "Trust"), hereby certifies that Cede & Co. (the
"Holder") is the registered owner of _________, _________________________
(_________) preferred securities of the Trust representing an undivided
beneficial interest in the assets of the Trust and designated the PSE&G Capital
Trust II 8.125% Cumulative Quarterly Income Preferred Securities, Series B
(liquidation amount $25 per Preferred Security) (the "Preferred Securities").
The Preferred 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 as provided in Section 5.04 of the
Trust Agreement (as defined below). The designations, rights, privileges,
restrictions, preferences and other terms and provisions of the Preferred
Securities are set forth in, and this certificate and the Preferred Securities
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Amended and Restated Trust Agreement of the Trust dated
as of February 7, 1997, as the same may be amended from time to time (the "Trust
Agreement"). The Holder is entitled to the benefits of the Guarantee Agreement
entered into by Public Service Electric and Gas Company, a New Jersey
corporation, and First Union National Bank as guarantee trustee, dated as of
February 7, 1997 (the "Guarantee") to the extent provided therein, together with
the obligations of Public Service Electric and Gas Company under the Trust
Agreement, its Deferrable Interest Subordinated Debentures and the Indenture
related to such Deferrable Interest Subordinated Debentures. The Trust will
furnish a copy of the aforementioned agreements and instruments to the Holder
without charge upon written request to the Trust at its principal place of
business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Administrative Trustee of the Trust has executed
this certificate this 7th day of February, 1997.
PSE&G CAPITAL TRUST II
By:
-----------------------------
Fred F. Saunders, as
Administrative Trustee
[To be included in Book-Entry Preferred Securities Certificate]
This Preferred Security is a Book-Entry Preferred Securities Certificate within
the meaning of the Trust Agreement previously referred to and is registered in
the name of The Depository Trust Company (the "Depository") or a nominee of the
Depository. This Preferred Security is exchangeable for Preferred Securities
registered in the name of a person other than the Depository or its nominee only
in the limited circumstances described in the Trust Agreement and no transfer of
this Preferred Security (other than a transfer of this Preferred Security as a
whole by the Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository) may be
registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized representative of
The Depository Trust Company, a New York corporation, (55 Water Street, New
York) to PSE&G Capital Trust II or its agent for registration of transfer,
exchange or payment, and any Preferred Security issued is registered in the name
of Cede & Co. or such other name as requested by an authorized representative of
The Depository Trust Company and any payment hereon is made to Cede & Co. or to
such other entity as is requested by an authorized representative of The
Depository Trust Company, ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede
& Co., has an interest herein.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers to: (Insert assignee's
social security or tax identification number) (Insert address and zip code of
assignee)
__________ Preferred Securities represented by this Preferred Securities
Certificate and irrevocably appoints
agent to transfer said Preferred Securities 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 Preferred Security
Certificate)