EXECUTION COPY
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AMENDED AND RESTATED TRUST AGREEMENT
MRM CAPITAL TRUST I
Dated as of September 21, 2000
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TABLE OF CONTENTS
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ARTICLE 1
Interpretation and Definitions
Section 1.01. Definitions................................................................. 2
ARTICLE 2
Trust Indenture Act
Section 2.01. Trust Indenture Act; Application............................................ 15
Section 2.02. Lists of Holders of Securities.............................................. 15
Section 2.03. Reports by the Property Trustee............................................. 16
Section 2.04. Periodic Reports to Property Trustee........................................ 16
Section 2.05. Evidence of Compliance with Conditions...................................... 16
Section 2.06. Events of Default; Waiver................................................... 16
Section 2.07. Event of Default; Notice.................................................... 18
ARTICLE 3
Organization
Section 3.01. Name........................................................................ 19
Section 3.02. Office...................................................................... 19
Section 3.03. Purpose..................................................................... 19
Section 3.04. Authority................................................................... 20
Section 3.05. Title to Property of the Trust.............................................. 20
Section 3.06. Powers and Duties of the Administrative Trustees............................ 20
Section 3.07. Prohibition of Actions by the Trust and the Trustees........................ 23
Section 3.08. Powers and Duties of the Property Trustee................................... 25
Section 3.09. Certain Duties and Responsibilities of the Property
Trustee........................................................................... 27
Section 3.10. Certain Rights of Property Trustee.......................................... 29
Section 3.11. Delaware Trustee............................................................ 32
Section 3.12. Execution of Documents...................................................... 32
Section 3.13. Not Responsible for Recitals or Issuance of Securities...................... 32
Section 3.14. Duration of Trust........................................................... 33
Section 3.15. Mergers..................................................................... 33
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ARTICLE 4
Sponsor
Section 4.01. Sponsor's Purchase of Common Securities..................................... 35
Section 4.02. Covenants of the Common Securities Holder................................... 35
Section 4.03. Responsibilities of the Sponsor............................................. 35
Section 4.04. Right to Proceed............................................................ 36
ARTICLE 5
Trustees
Section 5.01. Number of Trustees; Appointment of Co-Trustee............................... 36
Section 5.02. Delaware Trustee............................................................. 37
Section 5.03. Property Trustee; Eligibility................................................ 37
Section 5.04. Certain Qualifications of Administrative Trustees and
Delaware Trustee Generally........................................................ 38
Section 5.05. Administrative Trustees..................................................... 38
Section 5.06. Delaware Trustee............................................................ 39
Section 5.07. Appointment, Removal and Resignation of Trustees............................ 39
Section 5.08. Vacancies Among Trustees.................................................... 41
Section 5.09. Effect of Vacancies......................................................... 41
Section 5.10. Meetings.................................................................... 41
Section 5.11. Delegation of Power......................................................... 42
Section 5.12. Merger, Conversion, Consolidation or Succession to
Business.......................................................................... 42
Section 5.13. Compensation................................................................ 43
ARTICLE 6
Distributions; Reset Rate; Remarketing; Mandatory Redemption
Section 6.01. Distributions............................................................... 43
Section 6.02. Remarketing Procedures...................................................... 43
Section 6.03. Reset of Distribution Rate and Mandatory Redemption
Date.............................................................................. 46
Section 6.04. Renewed Remarketing.......................................................... 46
Section 6.05. Failed Remarketing........................................................... 47
Section 6.06. Payment of Taxes, Duties, Etc. of the Trust.................................. 47
Section 6.07. Adjustments to Trigger Price................................................ 47
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ARTICLE 7
Issuance of Securities
Section 7.01. General Provisions Regarding Securities..................................... 47
Section 7.02. Execution and Authentication................................................ 48
Section 7.03. Form and Dating............................................................. 49
Section 7.04. Registrar and Paying Agent.................................................. 50
Section 7.05. Paying Agent to Hold Money in Trust......................................... 51
Section 7.06. Replacement of Securities................................................... 51
Section 7.07. Outstanding Preferred Securities............................................ 52
Section 7.08. Preferred Securities in Treasury............................................ 52
Section 7.09. Temporary Securities........................................................ 52
Section 7.10. Cancellation................................................................ 52
Section 7.11. CUSIP Numbers............................................................... 53
ARTICLE 8
Dissolution and Termination of Trust
Section 8.01. Dissolution and Termination of Trust........................................ 53
ARTICLE 9
Transfer of Interests
Section 9.01. Transfer of Securities...................................................... 54
Section 9.02. Transfer Procedures and Restrictions........................................ 56
Section 9.03. Deemed Security Holders..................................................... 60
Section 9.04. Book-Entry Interests........................................................ 60
Section 9.05. Notices to Depository....................................................... 61
Section 9.06. Appointment of Successor Depository......................................... 61
ARTICLE 10
Limitation of Liability of Holders of Securities, Trustees or Others
Section 10.01. Liability.................................................................. 61
Section 10.02. Exculpation................................................................ 61
Section 10.03. Fiduciary Duty............................................................. 62
Section 10.04. Indemnification............................................................ 63
Section 10.05. Outside Businesses......................................................... 66
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ARTICLE 11
Accounting
Section 11.01. Fiscal Year............................................................... 67
Section 11.02. Certain Accounting Matters................................................ 67
Section 11.03. Banking................................................................... 67
Section 11.04. Withholding............................................................... 68
ARTICLE 12
Amendments And Meetings
Section 12.01. Amendments................................................................ 68
Section 12.02. Meetings of the Holders of Securities; Action by Written
Consent.......................................................................... 70
Section 12.03. Power of Attorney......................................................... 72
ARTICLE 13
Representations of Property Trustee and Delaware Trustee
Section 13.01. Representations and Warranties of Property Trustee........................ 72
Section 13.02. Representations and Warranties of Delaware Trustee........................ 73
ARTICLE 14
Miscellaneous
Section 14.01. Notices................................................................... 74
Section 14.02. Governing Law............................................................. 76
Section 14.03. Intention of the Parties.................................................. 76
Section 14.04. Headings.................................................................. 76
Section 14.05. Successors and Assigns.................................................... 76
Section 14.06. Partial Enforceability.................................................... 76
Section 14.07. Counterparts.............................................................. 76
Section 14.08. Jurisdiction and Service of Process....................................... 76
Annex I Terms of Securities.................................................. I-1
Exhibit A-1 Form of Preferred Security Certificate............................... 1-1
Exhibit A-2 Form of Common Security Certificate.................................. 2-1
Exhibit A-3 Form of Replacement Security Certificate............................. 3-1
Exhibit B Specimen of Senior Notes............................................. B-1
Exhibit C Purchase Agreement................................................... C-1
Exhibit D Remarketing Agreement................................................ D-1
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AMENDED AND RESTATED
TRUST AGREEMENT
of
MRM CAPITAL TRUST I
dated as of
September 21, 2000
AMENDED AND RESTATED TRUST AGREEMENT dated and effective as of September
21, 2000, by the Trustees (as defined herein), the Sponsor (as defined herein)
and by the Holders (as defined herein), from time to time, of undivided
beneficial interests in the assets of the Trust (as defined herein) to be issued
pursuant to this Agreement.
WHEREAS, certain of the Trustees and the Sponsor established MRM CAPITAL
TRUST I (the "Trust"), a trust created under the Business Trust Act (as defined
herein) pursuant to a Trust Agreement dated as of February 3, 2000 (the
"Original Agreement"), and a Certificate of Trust filed with the Secretary of
State of the State of Delaware on February 3, 2000, as amended by the
Certificate of Amendment dated as of August 3, 2000, for the sole purpose of
issuing and selling certain securities representing undivided beneficial
interests in the assets of the Trust and investing the proceeds thereof in
certain Senior Notes of the Senior Note Issuer (each as defined herein) and
engaging in only those activities necessary, advisable or incidental thereto;
WHEREAS, the parties hereto desire to amend and restate each and every term
and provision of the Original Agreement; and
NOW, THEREFORE, it being the intention of the parties hereto that the Trust
continue as a business trust under the Business Trust Act, that the Original
Agreement be amended and restated in its entirety as provided herein and that
this Agreement constitute the governing instrument of the Trust, the Trustees
declare that all assets contributed to the Trust will be held in trust for the
benefit of the Holders, from time to time, of the securities representing
undivided beneficial interests in the assets of the Trust issued hereunder,
subject to the provisions of this Agreement and, in consideration of the mutual
covenants contained herein and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties, intending to be legally
bound hereby, agree as follows:
ARTICLE 1
INTERPRETATION AND DEFINITIONS
SECTION 1.01. Definitions.
Unless the context otherwise requires:
(a) capitalized terms used in this Agreement but not defined in the
preambles above or elsewhere herein have the respective meanings assigned to
them in this Section 1.01;
(b) a term defined anywhere in this Agreement has the same meaning
throughout;
(c) all references to "the Agreement" or "this Agreement" are to this
Amended and Restated Trust Agreement, as amended from time to time, and each
Annex and Exhibit hereto, as modified, supplemented or amended from time to
time;
(d) all references in this Agreement to Articles and Sections and Annexes
and Exhibits are to Articles and Sections of and Annexes and Exhibits to this
Agreement unless otherwise specified;
(e) a term defined in the Trust Indenture Act (as defined herein) has the
same meaning when used in this Agreement unless otherwise defined in this
Agreement or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Additional Amount" means, with respect to the Trust Securities, the amount
of Additional Interest (as defined in the Indenture) paid by the Senior Note
Issuer on the Senior Notes.
"Additional Distributions" has the meaning set forth in Section 2(a) of
Annex I hereto.
"Additional Sums" means, with respect to the Trust Securities, the amount
of Additional Sums (as defined in the Indenture) paid by the Senior Note Issuer
on the Senior Notes.
"Administrative Trustee" has the meaning set forth in Section 5.01.
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"Affiliate" has the same meaning as given to that term in Rule 405 under
the Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent or Registrar.
"Associated Person" has the meaning set forth in Article 1(ee) of the By-
Laws of the National Association of Securities Dealers, Inc.
"Authorized Officer" of a Person means any other Person that is authorized
to legally bind such Person.
"Bid" means an irrevocable offer to purchase the aggregate outstanding
Liquidation Amount of Preferred Securities at the Remarketing Price with a
Distribution Rate equal to the Bid Rate specified in such Bid and with a
Mandatory Redemption Date on the Remarketed Maturity Date.
"Bid Rate" means the proposed Distribution Rate on the Preferred Securities
specified in a Bid.
"Book-Entry Interest" means a beneficial interest in a Global Preferred
Security Certificate registered in the name of a Depository or its nominee,
ownership and transfers of which shall be maintained and made through book
entries by the Depository as described in Section 9.04.
"Business Day" means a day on which banking institutions in New York, New
York or Wilmington, Delaware are not authorized or required by law or regulation
to close and, until the Remarketing Settlement Date, that is also a London
Banking Day.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware Code, 12
Del. Code (S) 3801 et seq., as it may be amended from time to time, or any
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successor legislation.
"Calculation Agent" means Banc of America Securities LLC.
"Closing Date" means the date of closing of the sale of the Preferred
Securities to the Initial Purchaser pursuant to the Purchase Agreement.
"Closing Price" on any Trading Day means the reported last sale price on
such day of the Common Shares as of the end of the regularly scheduled trading
day on the principal securities exchange on which the Common Shares are listed,
or, in case no such sale takes place on such day, the average of the reported
last bid and asked prices on such day, in either case, as reported on the
Consolidated
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Tape maintained by the Consolidated Tape Association or, if the Common Shares
are not listed or admitted to trading on any securities exchange which
participates in the Consolidated Tape Association, the average of the reported
last bid and asked prices of the Common Shares in the over-the-counter market on
such day as reported by the National Association of Securities Dealers Automated
Quotation System or a similar generally accepted reporting service or, if not so
reported, the average of the closing bid and asked prices as furnished by any
New York Stock Exchange, Inc. member firm selected from time to time by the
Calculation Agent for that purpose or, if not so available in such manner, as
otherwise determined in good faith by the Calculation Agent.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation.
"Commission" means the United States Securities and Exchange Commission as
from time to time constituted, or if at any time after the execution of this
Agreement such Commission is not existing and performing the duties now assigned
to it under applicable federal securities laws, then the body performing such
duties at such time.
"Common Securities" has the meaning set forth in Section 7.01(a).
"Common Securities Guarantee" means the Common Securities Guarantee
Agreement, dated as of September 21, 2000 of the Sponsor and the Guarantor in
respect of the Common Securities, as amended, supplemented, modified or
superseded from time to time.
"Common Shares" means common shares, par value $0.01 per share, of the
Guarantor.
"Company Indemnified Person" means (a) any Administrative Trustee; (b) any
Affiliate of any Administrative Trustee; (c) any officer, director, shareholder,
member, partner, employee, representative or agent of any Administrative
Trustee; or (d) any officer, employee or agent of the Trust or any of its
Affiliates; provided that the term "Company Indemnified Person" shall not
include any Fiduciary Indemnified Person.
"Corporate Trust Office" means the office of the Property Trustee for the
conduct of corporate trust business at which the matters related to this
Agreement shall, at any particular time, be principally administered, which
office at the date of execution of this Agreement is located at ▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
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"Covered Person" means: (a) any officer, director, shareholder, partner,
member, representative, employee or agent of (i) the Trust or (ii) any of the
Trust's Affiliates; or (b) any Holder.
"Credit Agreement" means the Credit Agreement dated September 21, 2000
among the Company, as borrower thereunder, the Guarantor, as guarantor
thereunder, the lenders party thereto and Bank of America, N.A., as agent, as
executed without giving effect to any waiver, amendment or termination thereof.
"Cross Default" means an Event of Default (as defined in the Credit
Agreement).
"Date of Determination" has the meaning set forth in Section 2(b) of Annex
I hereto.
"Default" means an event, act or condition that with notice or lapse of
time, or both, would constitute an Event of Default.
"Definitive Preferred Securities" has the meaning set forth in Section
7.03(b).
"Delaware Trustee" has the meaning set forth in Section 5.01.
"Depository" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act that, in the case of Preferred
Securities held in global form, is acting as depository for the Preferred
Securities and in whose name or in the name of a nominee of that organization
shall be registered a global certificate and which shall undertake to effect
book-entry transfers and pledges of the Preferred Securities.
"Direct Action" has the meaning set forth in Section 3.08(e).
"Distribution" means any amount payable to Holders in respect of Securities
as provided in Section 6.01.
"Distribution Date" has the meaning set forth in Section 2(c) of Annex I
hereto.
"Distribution Rate" has the meaning specified in Section 2(a) of Annex I
hereto.
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"Event of Default" means, with respect to the Securities, an Event of
Default (as defined in the Indenture) that has occurred and is continuing in
respect of the Senior Notes.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, or any successor legislation.
"Expected Reset Date" has the meaning set forth in Section 6.02(a).
"Failed Remarketing" has the meaning set forth in the Remarketing
Agreement.
"Fiduciary Indemnified Person" has the meaning set forth in Section
10.04(b).
"Final Reset Date" has the meaning set forth in Section 6.02(a).
"Fiscal Year" has the meaning set forth in Section 11.01.
"Former Holders" has the meaning set forth in Section 6.02(i).
"Global Preferred Security" has the meaning set forth in Section 7.03(b).
"Guarantor" means Mutual Risk Management Ltd., a company organized under
the laws of Bermuda, or any successor entity resulting from any merger,
consolidation, amalgamation or other business combination, in its capacity as
guarantor of the obligations of the Senior Note Issuer under the Indenture and
under the Remarketing Agreement.
"Holder" means a Person in whose name a Security or Successor Security is
registered, such Person being a beneficial owner within the meaning of the
Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or a Fiduciary
Indemnified Person.
"Indenture" means the Indenture (the "Base Indenture") dated as of
September 21, 2000 among the Senior Note Issuer, the Guarantor and the Senior
Note Trustee, as supplemented by the Supplemental Indenture and as further
amended, supplemented, modified or superseded from time to time.
"Initial Purchaser" means Intrepid Funding Master Trust.
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"Investment Company" means an investment company as defined in the
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"Investment Company Event" means the receipt by the Administrative Trustees
or the Property Trustee, on behalf of the Trust, of an Opinion of Counsel,
rendered by a law firm having a national tax and securities practice (which
Opinion of Counsel shall not have been rescinded by such law firm), to the
effect that, as a result of the occurrence of a change in law or regulation or a
change in interpretation or application of law or regulation by any legislative
body, court, governmental agency or regulatory authority (a "Change in 1940 Act
Law"), there is more than an insubstantial risk that the Trust is or will be
considered an "investment company" that is required to be registered under the
Investment Company Act, and that such Change in 1940 Act Law became effective on
or after the date of original issuance of the Preferred Securities under this
Agreement.
"Legal Action" has the meaning set forth in Section 3.06(h).
"LIBOR" means the rate determined by the Calculation Agent as the interest
rate expressed in decimal figures for deposits in the London interbank market
for a period of three months in U.S. Dollars that appears on the Telerate Page
3750 as of 11:00 a.m., London time, on the Date of Determination. If such rate
does not appear on the Telerate Page 3750, the rate on the Date of Determination
will be determined as if the parties had specified the LIBOR-Reference Banks
Rate as the applicable rate.
"LIBOR-Reference Banks Rate" means the rate determined on the basis of the
rates at which three-month deposits in U.S. Dollars in the Representative Amount
are offered at approximately 11:00 a.m., London time, on the Date of
Determination by the Reference Banks to prime banks in the London interbank
market for deposits commencing two London Banking Days following such Date of
Determination. The Calculation Agent will request the principal London office of
each of the Reference Banks to provide a quotation of its rate. If at least two
such quotations are provided, the rate will be the arithmetic mean of the
quotations. If fewer than two quotations are provided as requested, the rate
will be the arithmetic mean of the rates quoted at approximately 11:00 a.m. New
York City Time on the Date of Determination by major banks in New York City
(selected by the Calculation Agent) for three-month loans in U.S. Dollars in the
Representative Amount to leading banks for loans extended two London Banking
Days following such Date of Determination.
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"Like Amount" has the meaning set forth in Section 4 of Annex I hereto.
"Liquidation Amount" has the meaning set forth in Section 2(a) of Annex I
hereto.
"Liquidation Distribution" has the meaning set forth in Section 4 of Annex
I hereto.
"List of Holders" has the meaning set forth in Section 2.02(a).
"London Banking Day" means any day on which dealings in deposits in U.S.
Dollars are transacted in the London interbank market.
"Majority in Liquidation Amount" means, with respect to the Securities,
except as provided in the terms of the Securities or by the Trust Indenture Act,
Holders of outstanding Securities voting together as a single class or, as the
context may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities voting separately as a class, who are the record
owners of more than 50% of the aggregate Liquidation Amount (including the
amount that would be paid on redemption, liquidation or otherwise, plus accrued
and unpaid Distributions to the date upon which the voting percentages are
determined) of all outstanding Securities of the relevant class.
"Mandatory Redemption Date" means September 21, 2003; provided that on and
after the settlement of the sale of the Preferred Securities in a successful
Remarketing, the Mandatory Redemption Date shall be the Remarketed Maturity
Date.
"Mandatory Redemption Price" has the meaning set forth in Section 5(b) of
Annex I hereto.
"90 Day Period" has the meaning set forth in Section 5(c) of Annex I
hereto.
"Offering Memorandum" has the meaning set forth in Section 4.03(a).
"Officers' Certificate" means, with respect to any Person, a certificate
signed (i) by the Chairman, the President or any Vice President (whether or not
designated by a number or numbers or a word or words added before or after the
title "Vice President") of such Person, and (ii) by the Chief Financial Officer,
Treasurer, any Assistant Treasurer, the Secretary or an Assistant Secretary of
such Person; provided that in the case of the Trust, any Officers' Certificate
shall be a certificate signed by at least one Administrative Trustee. Any
Officers'
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Certificate delivered with respect to compliance with a condition or covenant
provided for in this Agreement (other than pursuant to Section 2.04) shall
include:
(a) a statement that each person signing the Officers' Certificate has read
the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each person in rendering the Officers' Certificate;
(c) a statement that each such person has made such examination or
investigation as, in such person's opinion, 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
(d) a statement as to whether, in the opinion of each such person, such
condition or covenant has been complied with.
"Original Agreement" has the meaning set forth in the first recital hereof.
"Opinion of Counsel" means a written opinion of counsel which shall be
delivered to the Property Trustee.
"Participants" has the meaning set forth in Section 7.03(d).
"Paying Agent" has the meaning set forth in Section 7.04.
"Payment Amount" has the meaning set forth in Section 6.01.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"PORTAL Market" means the Private Offerings, Resales and Trading through
Automated Linkages Market operated by the National Association of Securities
Dealers, Inc. or any successor thereto.
"Potential Adjustment Event" means any of the following:
(i) a subdivision, consolidation or reclassification of the Common
Shares (unless as a result of a merger or other similar event);
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(ii) a distribution or dividend to existing holders of the Common
Shares of (A) Common Shares, (B) other share capital or securities granting
the right to payment of dividends and/or the proceeds of liquidation of the
Guarantor equally or proportionately with such payments to holders of
Common Shares, or (C) any other type of securities, rights or warrants or
other assets, in any case for payment (cash or other) at less than the
prevailing market price as determined by the Calculation Agent;
(iii) any dividend paid by the Guarantor on the Common Shares other
than ordinary cash dividends (which ordinary cash dividends include
amounts, sometimes called "dividend equivalents," paid under the
Guarantor's employee benefit and compensation plans on Common Share grants
(whether options, restricted stock or other) under such plans, but only to
the extent such amounts do not exceed the amounts of ordinary cash
dividends that would be payable were such Common Share grants treated as
Common Shares); or
(iv) any other similar event that may have a diluting or
concentrative effect on the theoretical value of the Common Shares.
"Preferred Securities" has the meaning set forth in Section 7.01(a).
"Preferred Securities Guarantee" means the Preferred Securities Guarantee
Agreement dated as of September 21, 2000, of the Sponsor and the Guarantor in
respect of the Preferred Securities as amended, supplemented, modified or
superseded from time to time.
"Preferred Security Beneficial Owner" means, with respect to a Book-Entry
Interest, a Person who is the beneficial owner of such Book-Entry Interest, as
reflected on the books of the Depository, or on the books of a Person
maintaining an account with such Depository (directly as a Participant or as an
indirect participant, in each case in accordance with the rules of such
Depository).
"Pre-Remarketing Distribution Date" has the meaning set forth in Section
2(b) of Annex I hereto.
"Property Trustee" has the meaning set forth in Section 5.03(a).
"Property Trustee Account" has the meaning set forth in Section 3.08(c).
"Pro Rata" has the meaning set forth in Section 9 of Annex I hereto.
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"Purchase Agreement" means the Purchase Agreement dated September 21, 2000
among the Sponsor, the Trust, the Guarantor and the Initial Purchaser relating
to the sale and purchase of the Preferred Securities in the form of Exhibit C.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Qualifying Offering" means an offering of securities pursuant to the
Forward Underwriting Agreement dated as of September 21, 2000 between the
Guarantor and Banc of America Securities LLC.
"Quorum" means a majority of the Administrative Trustees or, if there are
only two Administrative Trustees, either of them.
"Redemption/Distribution Notice" has the meaning set forth in Section
5(g)(i) of Annex I hereto.
"Reference Banks" means the four major banks in the London interbank market
selected by the Calculation Agent.
"Reference Corporate Dealer" means a leading dealer of publicly traded debt
securities selected by the Sponsor, which dealer shall be a QIB and shall not
include Banc of America Securities LLC, its Affiliates or its Associated
Persons.
"Registrar" has the meaning set forth in Section 7.04.
"Remarketed Maturity Date" means the later of (i) the first anniversary of
the Remarketing Settlement Date on which Replacement Securities are issued, and
(ii) September 21, 2003.
"Remarketing" means a remarketing of Preferred Securities pursuant to
Article 6.
"Remarketing Agent" means Banc of America Securities LLC.
"Remarketing Agreement" means the Remarketing and Contingent Purchase
Agreement to be dated as of September 21, 2000 among the Senior Note Issuer, the
Trust, the Guarantor and the Remarketing Agent, in the form of Exhibit D.
"Remarketing Fee" means the fee specified in the Remarketing Agreement as
the Remarketing Fee.
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"Remarketing Price" means 100.25% of the aggregate stated Liquidation
Amount of the Preferred Securities.
"Remarketing Settlement Date" means the third Business Day immediately
following the Reset Date.
"Renewed Remarketing" has the meaning set forth in Section 6.04.
"Replacement Securities" has the meaning set forth in Section 6.02(j).
"Representative Amount" means an amount that is equal to the aggregate
Liquidation Amount of all of the Trust Securities.
"Reset Date" means any date established as a Reset Date pursuant to Section
6.02(a) or 6.04.
"Responsible Officer" means, with respect to the Property Trustee, any
officer within the Corporate Trust Office of the Property Trustee with direct
responsibility for the administration of this Agreement, including any vice-
president, any assistant vice-president, any assistant treasurer or other
officer of the Corporate Trust Office of the Property Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer of the Property Trustee to whom such matter is referred
because of that officer's knowledge of and familiarity with the particular
subject.
"Restricted Security" has the meaning set forth in Section 9.01(d).
"Rule 144A" means Rule 144A as promulgated under the Securities Act, or any
successor rule.
"Rule 144(k)" means Rule 144(k) as promulgated under the Securities Act, or
any successor rule.
"Secondary Purchase Agreement" means an agreement to be dated as of the
Reset Date (or such other date permitted by applicable law) among the Sponsor,
the Guarantor, the Trust (if applicable), the Remarketing Agent and the
Secondary Purchaser providing for the purchase of the Preferred Securities, or
the Senior Notes, as the case may be, by the Secondary Purchaser, in a form
customary for transactions of this type and as otherwise agreed among the
Sponsor, the Guarantor, the Trust (if applicable), the Remarketing Agent and the
Secondary Purchaser.
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"Secondary Purchaser" has the meaning set forth in Section 6.02(c).
"Securities" or "Trust Securities" means the Common Securities and the
Preferred Securities.
"Securities Act" means the Securities Act of 1933, as amended from time to
time, or any successor legislation.
"Securities Guarantees" means the Common Securities Guarantee and the
Preferred Securities Guarantee.
"Senior Note Issuer" means Mutual Group Ltd., a Delaware corporation, or
any successor entity resulting from any consolidation, amalgamation, merger or
other business combination, in its capacity as issuer of the Senior Notes under
the Indenture.
"Senior Note Purchase Agreement" means the Senior Note Purchase Agreement
dated as of September 21, 2000 between the Trust and the Senior Note Issuer.
"Senior Notes" means the Auction Rate Reset Senior Notes Series A of the
Senior Note Issuer issued pursuant to the Indenture in the form of Exhibit B.
"Senior Note Trustee" means The Chase Manhattan Bank, a New York banking
corporation, as trustee under the Indenture until a successor is appointed
thereunder, and thereafter means such successor trustee.
"Special Event" means a Tax Event or an Investment Company Event.
"Sponsor" means Mutual Group Ltd., a Delaware corporation, or any successor
entity resulting from any merger, consolidation, amalgamation or other business
combination, in its capacity as sponsor of the Trust.
"Subscription Agreement" means the Subscription Agreement dated as of
September 21, 2000 between the Trust and Mutual Group Ltd., a Delaware
corporation.
"Successor Delaware Trustee" has the meaning set forth in Section
5.07(b)(ii).
"Successor Entity" has the meaning set forth in Section 3.15(b)(i).
13
"Successor Property Trustee" has the meaning set forth in Section
3.08(f)(ii).
"Successor Securities" has the meaning set forth in Section 3.15(b)(i)(B).
"Super Majority" has the meaning set forth in Section 2.06(a)(ii).
"Supplemental Indenture" means the First Supplemental Indenture dated as of
September 21, 2000 among the Senior Note Issuer, the Guarantor and the Senior
Note Trustee pursuant to which the Senior Notes are to be issued, as amended,
supplemented, modified or superseded from time to time.
"Tax Event" means the receipt by the Administrative Trustees or the
Property Trustee, on behalf of the Trust, of an Opinion of Counsel, rendered by
a law firm having a national tax and securities practice (which Opinion of
Counsel shall not have been rescinded by such law firm), to the effect that, as
a result of any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein, or as a result of
any official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of original
issuance of the Preferred Securities under this Agreement, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days after the
date thereof, subject to United States federal income tax with respect to
interest received or accrued on the Senior Notes, (ii) interest payable by the
Senior Note Issuer on the Senior Notes is not, or will not be, within 90 days
after the date thereof, deductible, in whole or in part, for United States
Federal income tax purposes or (iii) the Trust is, or will be within 90 days
after the date thereof, subject to more than a de minimis amount of taxes,
duties, assessments or other governmental charges.
"10% in Liquidation Amount" means, with respect to the Securities, except
as provided in the terms of the Securities or by the Trust Indenture Act,
Holders of outstanding Securities voting together as a single class or, as the
context may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities voting separately as a class, who are the record
owners of 10% or more of the aggregate Liquidation Amount (including the amount
that would be paid on redemption, liquidation or otherwise, plus accrued and
unpaid Distributions to the date upon which the voting percentages are
determined) of all outstanding Securities of the relevant class.
14
"Trading Day" means any day, as reasonably determined by the
Remarketing Agent, on which the Common Shares are not suspended from trading at
any time during such day on the New York Stock Exchange, Inc., or, if not then
admitted for trading on the New York Stock Exchange, Inc., on the principal
securities exchange or quotation system on which the Common Shares are then
listed or admitted for trading.
"Transfer Restriction Termination Date" means the first date on which
the Preferred Securities (other than Preferred Securities acquired by any
Affiliate of the Trust) may be sold pursuant to Rule 144(k).
"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Trigger Event" has the meaning set forth in Section 6.02(a).
"Trigger Price" has the meaning set forth in Section 6.07.
"Trustee" or "Trustees" means each Person who has signed this Agreement
as a trustee, so long as such Person shall continue as Trustee of the Trust in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended
from time to time, or any successor legislation.
"U.S. Dollar" and "$" mean the lawful currency of the United States of
America.
"Winning Bid Rate" has the meaning set forth in Section 6.02(b).
15
ARTICLE 2
TRUST INDENTURE ACT
SECTION 2.01. Trust Indenture Act; Application. (a) This Agreement is
subject to the provisions of the Trust Indenture Act that would be required to
be part of this Agreement in order for this Agreement to be qualified under the
Trust Indenture Act and shall, to the extent applicable, be governed by such
provisions.
(b) The Property Trustee shall be the only Trustee which is a "trustee"
for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this Agreement limits,
qualifies or conflicts with the duties imposed by ▇▇.▇▇. 310 to 317, inclusive,
of the Trust Indenture Act, such imposed duties shall control.
(d) The application of the Trust Indenture Act to this Agreement shall
not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
SECTION 2.02. Lists of Holders of Securities. (a) Each of the Sponsor
and the Administrative Trustees on behalf of the Trust shall provide the
Property Trustee, unless the Property Trustee is the Registrar for the
Securities, a list, in such form as the Property Trustee may reasonably require,
of the names and addresses of the Holders of the Securities (a "List of
Holders") (i) within 14 days after each record date for payment of
Distributions, as of such record date; provided that neither the Sponsor nor the
Administrative Trustees on behalf of the Trust shall be obligated to provide
such List of Holders at any time the List of Holders does not differ from the
most recent List of Holders given to the Property Trustee by the Sponsor and the
Administrative Trustees on behalf of the Trust, and (ii) at any other time,
within 30 days of receipt by the Trust of a written request from the Property
Trustee for a List of Holders as of a date no more than 14 days before such List
of Holders is given to the Property Trustee. The Property Trustee shall
preserve, in as current a form as is reasonably practicable, all information
contained in Lists of Holders given to it or which it receives in the capacity
as Paying Agent (if acting in such capacity); provided that the Property Trustee
may destroy any List of Holders previously given to it on receipt of a new List
of Holders. Notwithstanding the foregoing, the Sponsor shall not be obligated to
provide such List of Holders at any time the Preferred Securities are
represented by one or more Global Preferred Securities.
(b) The Property Trustee shall comply with the obligations set forth
under ▇▇.▇▇. 311(a), 311(b) and 312(b) of the Trust Indenture Act.
16
SECTION 2.03. Reports by the Property Trustee. Within 60 days after
September 15 of each year, commencing September 15, 2001, the Property Trustee
shall provide to the Holders of the Preferred Securities such reports as are
required by ss. 313(a) of the Trust Indenture Act, if any, in the form and in
the manner provided by ss. 313 of the Trust Indenture Act. The Property Trustee
shall also comply with the other requirements of ss. 313 of the Trust Indenture
Act.
SECTION 2.04. Periodic Reports to Property Trustee. Each of the Sponsor
and the Administrative Trustees on behalf of the Trust shall provide to the
Property Trustee such documents, reports and information as are required by ss.
314 of the Trust Indenture Act (if any) and the compliance certificate required
by ss. 314(a)(4) of the Trust Indenture Act in the form, in the manner and at
the times required by ss. 314 of the Trust Indenture Act, provided, that such
certificate shall be delivered no later than 120 days after the end of each
fiscal year of the Sponsor.
SECTION 2.05. Evidence of Compliance with Conditions. Each of the
Sponsor and the Administrative Trustees on behalf of the Trust shall provide to
the Property Trustee such evidence of compliance with any conditions precedent
provided for in this Agreement that relate to any of the matters set forth in
ss. 314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to ss. 314(c)(1) of the Trust Indenture Act may be
given in the form of an Officers' Certificate.
SECTION 2.06. Events of Default; Waiver. (a) The Holders of a Majority
in Liquidation Amount of Preferred Securities may, by vote, on behalf of the
Holders of all of the Preferred Securities, waive any past Event of Default in
respect of the Preferred Securities and its consequences; provided that, if the
underlying Event of Default under the Indenture:
(i) is not waivable under the Indenture, the Event of Default
under this Agreement shall also not be waivable; or
(ii) requires the consent or vote of the holders of greater than
a majority in aggregate principal amount (a "Super Majority") of the
Senior Notes to be waived under the Indenture, the Event of Default
under this Agreement may only be waived by the vote of the Holders of
at least such Super Majority of the aggregate Liquidation Amount of the
Preferred Securities.
The foregoing provisions of this Section 2.06(a) shall be in lieu of ss.
316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust
Indenture Act is hereby expressly excluded from this Agreement and the
Securities, as permitted
17
by the Trust Indenture Act. Upon such waiver, any such default shall cease to
exist, and any Event of Default with respect to the Preferred Securities arising
therefrom shall be deemed to have been cured, for every purpose of this
Agreement and the Preferred Securities, but no such waiver shall extend to any
subsequent or other default or Event of Default with respect to the Preferred
Securities or impair any right consequent thereon. Any waiver by the Holders of
the Preferred Securities of an Event of Default with respect to the Preferred
Securities shall also be deemed to constitute a waiver by the Holders of the
Common Securities of any such Event of Default with respect to the Common
Securities for all purposes of this Agreement without any further act, vote or
consent of the Holders of the Common Securities.
(b) The Holders of a Majority in Liquidation Amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences; provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived such Event
of Default under this Agreement as provided below in this Section
2.06(b), the Event of Default under the Agreement shall also not be
waivable; or
(ii) requires the consent or vote of holders of a Super
Majority to be waived, except where the Holders of the Common
Securities are deemed to have waived such Event of Default under this
Agreement as provided below in this Section 2.06(b), the Event of
Default under this Agreement may only be waived by the vote of the
Holders of at least such Super Majority of the aggregate Liquidation
Amount of the Common Securities;
provided further, that each Holder of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with respect to the
Common Securities and their consequences until all Events of Default with
respect to the Preferred Securities have been cured, waived or otherwise
eliminated, and until such Events of Default with respect to the Preferred
Securities have been so cured, waived or otherwise eliminated, the Property
Trustee will be deemed to be acting solely on behalf of the Holders of the
Preferred Securities and only the Holders of the Preferred Securities will have
the right to direct the Property Trustee in accordance with the terms of the
Securities. The foregoing provisions of this Section 2.06(b) shall be in lieu of
▇▇.▇▇. 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such ▇▇.▇▇.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly
18
excluded from this Agreement and the Securities, as permitted by the Trust
Indenture Act. Subject to the foregoing provisions of this Section 2.06(b), upon
such waiver, any such default shall cease to exist and any Event of Default with
respect to the Common Securities arising therefrom shall be deemed to have been
cured for every purpose of this Agreement, but no such waiver shall extend to
any subsequent or other default or Event of Default with respect to the Common
Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the
Property Trustee, at the direction of the Holders of the Preferred Securities,
constitutes a waiver of the corresponding Event of Default under this Agreement.
The foregoing provisions of this Section 2.06(c) shall be in lieu of ss.
316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust
Indenture Act is hereby expressly excluded from this Agreement and the
Securities, as permitted by the Trust Indenture Act.
SECTION 2.07. Event of Default; Notice. (a) The Property Trustee
shall, within 90 days after the occurrence of any default, transmit by mail,
first class postage prepaid, to the Holders of the Securities and to the
Sponsor, notices of all defaults with respect to the Securities actually known
to a Responsible Officer of the Property Trustee, unless such defaults have been
cured before the giving of such notice (the term "defaults" for the purposes of
this Section 2.07(a) being hereby defined to be an Event of Default as defined
in the Indenture, not including any periods of grace provided for therein and
irrespective of the giving of any notice provided therein); provided that,
except for a default in the payment of principal of (or premium, if any) or
interest on any of the Senior Notes, the Property Trustee shall be protected in
withholding such notice if and so long as a Responsible Officer of the Property
Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of the Securities.
(b) The Property Trustee shall not be deemed to have actual knowledge
of any default except:
(i) a default under Sections 5.1(a) and 5.1(b) of the Base
Indenture; or
(ii) any default as to which the Property Trustee shall have
received written notice or of which a Responsible Officer of the
Property Trustee charged with the administration of the Agreement shall
have actual knowledge.
(c) The Sponsor and the Administrative Trustees shall file annually
with the Property Trustee, no later than 120 days after the end of each fiscal
year of the
19
Sponsor, a certification as to whether or not they are in compliance with all
the conditions and covenants applicable to them under this Agreement.
ARTICLE 3
ORGANIZATION
SECTION 3.01. Name. The Trust is named "MRM Capital Trust I" as such
name may be modified from time to time by the Administrative Trustees following
written notice to the Delaware Trustee, the Property Trustee and the Holders of
Securities (and any such modification shall not be subject to the amendment
provisions of Section 12.01 hereof). The Trust's activities may be conducted
under the name of the Trust or any other name deemed advisable by the
Administrative Trustees.
SECTION 3.02. Office. The address of the principal office of the Trust
is c/o Mutual Group Ltd, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. On ten Business Days' prior written notice to the Delaware
Trustee, the Property Trustee and the Holders of Securities, the Administrative
Trustees may designate another principal office.
SECTION 3.03. Purpose. The exclusive purposes and functions of the
Trust are to (a) issue and sell Securities, (b) use the proceeds from the sale
of the Securities to acquire the Senior Notes in an aggregate principal amount
equal to the aggregate Liquidation Amount of such Securities, and (c) except as
otherwise limited herein, to engage in only those other activities necessary,
advisable or incidental thereto, including without limitation, those activities
specified in Sections 3.06, 3.08, 3.09, 3.10, 3.11 and/or 3.12. The Trust shall
not borrow money, issue debt or reinvest proceeds derived from investments,
pledge any of its assets or otherwise undertake (or permit to be undertaken) any
activity that would cause the Trust not to be classified for United States
federal income tax purposes as a grantor trust.
It is intended that the Trust be classified as a grantor trust for
United States federal income tax purposes under Subpart E of Subchapter J of the
Code, pursuant to which the owners of the Preferred Securities and the Common
Securities will be the owners of the Trust for United States federal income tax
purposes, and each such owner will include directly in gross income its pro rata
share of each item of income, gain, deduction or loss of the Trust as if the
Trust did not exist. By the acceptance of this Trust, the Trustees, the Sponsor,
the Holders of the Preferred Securities and Common Securities and the Preferred
Security Beneficial Owners agree not to take any position for United States
20
federal income tax purposes that is contrary to the classification of the Trust
as a grantor trust.
SECTION 3.04. Authority. Subject to the limitations provided in this
Agreement and to the specific duties of the Property Trustee and the Sponsor,
the Administrative Trustees shall have exclusive and complete authority to carry
out the purposes of the Trust. An action taken by one or more of the
Administrative Trustees in accordance with their powers shall constitute the act
of and serve to bind the Trust and an action taken by the Property Trustee on
behalf of the Trust in accordance with its powers shall constitute the act of
and serve to bind the Trust. In dealing with the Trustees acting on behalf of
the Trust, no Person shall be required to inquire into the authority of the
Trustees to bind the Trust. Persons dealing with the Trust are entitled to rely
conclusively on the power and authority of the Trustees as set forth in this
Agreement.
SECTION 3.05. Title to Property of the Trust. Except as provided in
Section 3.08 with respect to the Senior Notes and the Property Trustee Account
or as otherwise provided in this Agreement, legal title to all assets of the
Trust shall be vested in the Trust. The Holders shall not have legal title to
any part of the assets of the Trust, but shall have an undivided beneficial
interest in the assets of the Trust.
SECTION 3.06. Powers and Duties of the Administrative Trustees. The
Administrative Trustees shall have the exclusive power, duty and authority to,
and are hereby authorized and directed to cause the Trust to, engage in the
following activities:
(a) to execute, deliver, issue and sell the Preferred Securities and
the Common Securities in accordance with this Agreement; provided that (i) the
Trust may issue no more than one series of Preferred Securities and no more than
one series of Common Securities, (ii) there shall be no interests in the Trust
other than the Securities and (iii) the issuance of Securities shall be limited
to a simultaneous issuance of both Preferred Securities and Common Securities on
the Closing Date and on the Remarketing Settlement Date;
(b) in connection with any Remarketing of the Preferred Securities and,
with respect to clauses (v) and (vi) of this Section 3.06(b), in connection with
the issuance and sale of the Preferred Securities, at the direction of the
Sponsor, to:
(i) in the event of a Remarketing, take such actions as the
Remarketing Agent or the Secondary Purchaser may reasonably request in
connection with the qualification of the Preferred Securities for
trading in the PORTAL Market;
21
(ii) execute and file any documents prepared by the Sponsor,
or take any acts as determined by the Sponsor to be necessary in order
to qualify or register all or part of the Preferred Securities in any
State in which the Sponsor has determined to qualify or register such
Preferred Securities for sale;
(iii) execute and deliver letters, documents, or instruments
with The Depository Trust Company and other Depositories relating to
the Preferred Securities;
(iv) if applicable, enter into, and to execute and deliver
and perform on behalf of the Trust, a Secondary Purchase Agreement
providing for the resale of the Preferred Securities upon Remarketing;
(v) enter into, and to execute and deliver and perform on
behalf of the Trust, the Subscription Agreement and the Senior Note
Purchase Agreement; and
(vi) execute and file any agreement, certificate or other
document which such Administrative Trustee deems necessary or
appropriate in connection with the issuance and sale or resale of the
Preferred Securities;
(c) to acquire the Senior Notes with the proceeds of the sale of the
Securities; provided that the Administrative Trustees shall cause legal title to
the Senior Notes to be held of record in the name of the Property Trustee for
the benefit of the Holders of Securities;
(d) to cause the Trust to enter into such agreements and arrangements
as may be necessary or desirable in connection with the sale of the Securities
and the consummation thereof, and to take all action, and exercise all
discretion, as may be necessary or desirable in connection with the consummation
thereof;
(e) to give the Sponsor and the Property Trustee prompt written notice
of the occurrence of a Special Event; provided that the Administrative Trustees
shall consult with the Sponsor prior to taking or refraining from taking any
action in relation to a Special Event;
(f) to establish a record date with respect to all actions to be taken
hereunder that require a record date to be established, including and with
respect to, for the purposes of ss.316(c) of the Trust Indenture Act,
Distributions, voting rights and redemptions, and to issue relevant notices to
the Holders of Securities as to such actions and applicable record dates;
22
(g) to take all actions and perform such duties as may be required of
the Administrative Trustees pursuant to the terms of the Securities;
(h) to bring or defend, pay, collect, compromise, arbitrate, resort to
legal action, or otherwise adjust claims or demands of or against the Trust
("Legal Action"), unless pursuant to Section 3.08(e), the Property Trustee has
the exclusive power to bring such Legal Action;
(i) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors, and
consultants and pay reasonable compensation for such services;
(j) to cause the Trust to comply with the Trust's obligations under the
Trust Indenture Act;
(k) to give the certificate required by ss. 314(a)(4) of the Trust
Indenture Act to the Property Trustee, which certificate may be executed by any
Administrative Trustee;
(l) to incur expenses that are necessary or incidental to carry out any
of the purposes of the Trust;
(m) to act as, or appoint another Person to act as, Registrar for the
Securities or to appoint a Paying Agent for the Securities as provided in
Section 7.04 except for such time as such power to appoint a Paying Agent is
vested in the Property Trustee;
(n) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of the
State of Delaware and of each other jurisdiction in which such existence is
necessary to protect the limited liability of the Holders of the Preferred
Securities or to enable the Trust to effect the purposes for which the Trust was
created;
(o) to take any action, provided that such action does not materially
adversely affect the interests of the Holders of Securities, not inconsistent
with this Agreement or with applicable law, that the Administrative Trustees
determine in their discretion to be necessary or desirable in carrying out the
activities of the Trust as set out in this Section 3.06, including, but not
limited to:
(i) causing the Trust not to be deemed to be an Investment
Company required to be registered under the Investment Company Act;
23
(ii) causing the Trust to be classified for United States
Federal income tax purposes as a grantor trust; and
(iii) cooperating with the Senior Note Issuer to ensure that the
Senior Notes will be treated as indebtedness of the Senior Note Issuer
for United States Federal income tax purposes;
(p) to take all action necessary to cause all applicable tax returns
and tax information reports that are required to be filed with respect to the
Trust to be duly prepared and filed by the Administrative Trustees, on behalf of
the Trust; and
(q) to execute and deliver and record, file or register, as applicable,
all documents, certificates, agreements or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary, advisable or incidental to the foregoing.
The Administrative Trustees must exercise the powers set forth in this
Section 3.06 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.03, and the Administrative Trustees shall not
take any action that is inconsistent with the purposes and functions of the
Trust set forth in Section 3.03.
Subject to this Section 3.06, the Administrative Trustees shall have
none of the powers or the authority of the Property Trustee set forth in Section
3.08.
Any expenses incurred by the Administrative Trustees pursuant to this
Section 3.06 shall be reimbursed by the Senior Note Issuer.
SECTION 3.07. Prohibition of Actions by the Trust and the Trustees. (a)
Neither the Trust nor any of the Trustees (including the Property Trustee and
the Delaware Trustee) shall, and the Administrative Trustees shall not cause the
Trust to, engage in any activity other than as required or authorized by this
Agreement. In particular, neither the Trust nor any of the Trustees shall:
(i) invest any proceeds received by the Trust from holding the
Senior Notes, but shall distribute all such proceeds to Holders of
Securities pursuant to the terms of this Agreement and of the
Securities;
(ii) acquire any assets other than as expressly provided
herein;
(iii) possess Trust property for other than a Trust purpose or
execute any mortgage in respect of, or pledge, any Trust property;
24
(iv) make any loans other than loans represented by the Senior
Notes or incur any indebtedness;
(v) possess any power or otherwise act in such a way as to
vary the Trust assets or the terms of the Securities in any way
whatsoever (except to the extent expressly authorized in this Agreement
or by the terms of the Securities) or otherwise undertake (or permit to
be undertaken) any activity that would cause the Trust to fail or cease
to qualify as a grantor trust for United States federal income tax
purposes;
(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Securities;
(vii) so long as any Senior Notes are held by the Property
Trustee, (A) direct the time, method and place of conducting any
proceeding with respect to any remedy available to the Senior Note
Trustee, or exercise any trust or power conferred upon the Senior Note
Trustee with respect to the Senior Notes, (B) waive any past default
that is waivable under the Indenture, (C) exercise any right to rescind
or annul any declaration of acceleration of the maturity of the
principal of the Senior Notes or (D) consent to any amendment,
modification or termination of the Indenture or the Senior Notes where
such consent shall be required, without, in each case, obtaining the
prior approval of the Holders of a Majority in Liquidation Amount of
all outstanding Securities of the Trust; provided that where a consent
under the Indenture would require the consent of each holder of Senior
Notes affected thereby, no such consent shall be given by the Property
Trustee without (1) the prior approval of each Holder of Securities and
(2) an Opinion of Counsel delivered to the Trust and the Property
Trustee from independent tax counsel experienced in such matters to the
effect that the Trust will not be classified as an association or a
publicly traded partnership taxable as a corporation for United States
federal income tax purposes on account of such action. In addition,
other than with respect to directing the time, method and place of
conducting a proceeding for any remedy available to the Property
Trustee or the Senior Note Trustee as set forth above, the Property
Trustee shall not take any action in accordance with the directions of
the Holders of the Preferred Securities under this paragraph unless the
Property Trustee has obtained an Opinion of Counsel specified in the
immediately preceding clause (2);
(viii) revoke any action previously authorized or approved by a
vote of the Holders of Preferred Securities except by subsequent vote
of such Holders; or
25
(ix) revoke any action previously authorized or approved by a
vote of the Holders of Common Securities except by subsequent vote of
such Holders.
SECTION 3.08. Powers and Duties of the Property Trustee. (a) The legal
title to the Senior Notes shall be owned by and held of record in the name of
the Property Trustee in trust for the benefit of the Trust and the Holders of
the Securities. The right, title and interest of the Property Trustee in the
Senior Notes shall vest automatically in each Person who may hereafter be
appointed as Property Trustee in accordance with Section 5.07. Such vesting and
cessation of title shall be effective whether or not conveyancing documents with
regard to the Senior Notes have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title and
interest in the Senior Notes to the Administrative Trustees or to the Delaware
Trustee (if the Property Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest bearing
trust account (the "Property Trustee Account") in the name of and under
the exclusive control of the Property Trustee on behalf of the Holders
of the Securities and, upon the receipt of payments of funds made in
respect of the Senior Notes held by the Property Trustee, deposit such
funds into the Property Trustee Account and make payments or cause the
Paying Agent to make payments to the Holders of the Securities from the
Property Trustee Account in accordance with Section 6.01. Funds in the
Property Trustee Account shall be held uninvested until disbursed in
accordance with this Agreement;
(ii) engage in such ministerial activities as shall be
necessary or appropriate to effect the redemption of the Securities to
the extent the Senior Notes are redeemed or mature;
(iii) upon written notice of the occurrence of a distribution of
the Senior Notes issued by the Administrative Trustees in accordance
with the terms of the Securities, engage in such ministerial activities
as shall be necessary or appropriate to effect the distribution of the
Senior Notes to Holders of Securities; and
(iv) take such ministerial action as may be reasonably
requested by the Administrative Trustees in connection with the winding
up of the
26
affairs of or liquidation of the Trust in accordance with this
Agreement and the preparation, execution and filing of a certificate of
cancellation or other appropriate certificates with the Secretary of
State of the State of Delaware and other appropriate governmental
authorities, if any.
(d) The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant to the
terms of this Agreement and the Securities.
(e) Subject to Section 3.09(a), the Property Trustee may take any
Legal Action that arises out of or in connection with (i) an Event of Default of
which a Responsible Officer of the Property Trustee has actual knowledge or (ii)
the Property Trustee's duties and obligations under this Agreement or the Trust
Indenture Act and, if the Property Trustee shall have failed to take such Legal
Action, the Holders of the Preferred Securities may, to the fullest extent
permitted by law, take such Legal Action, to the same extent as if such Holders
of Preferred Securities held an aggregate principal amount of Senior Notes equal
to the aggregate Liquidation Amount of such Preferred Securities, without first
proceeding against the Property Trustee or the Trust; provided that if an Event
of Default has occurred and is continuing and such event is attributable to the
failure of the Senior Note Issuer to pay the principal of or premium, if any, or
interest on the Senior Notes on the date such principal, premium, if any, or
interest is otherwise payable (or, in the case of redemption, on the redemption
date), then a Holder of Preferred Securities may directly institute a proceeding
for enforcement of payment to such Holder of the principal of or premium, if
any, or interest on the Senior Notes having a principal amount equal to the
aggregate Liquidation Amount of the Preferred Securities of such Holder on or
after the respective due date specified in the Indenture or in the Senior Notes
(a "Direct Action"). In connection with such Direct Action, the Senior Note
Issuer shall remain obligated to pay the principal of, premium, if any, or
interest on such Senior Notes, and the Common Securities Holder shall be
subrogated to the rights of such Holder of Preferred Securities to the extent of
any payment made by the Senior Note Issuer to such Holder in such Direct Action.
Except as provided in the preceding sentences, the Holders of Preferred
Securities will not be able to exercise directly any other remedy available to
the holders of the Senior Notes.
(f) The Property Trustee shall continue to serve as a Trustee until
either:
(i) the Trust has been completely liquidated and the proceeds of
the liquidation distributed to the Holders of Securities pursuant to
the terms of the Securities and this Agreement; or
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(ii) a successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 5.07 (a "Successor
Property Trustee").
(g) The Property Trustee shall have the legal power to exercise all of
the rights, powers and privileges of a holder of Senior Notes under the
Indenture and, if an Event of Default actually known to a Responsible Officer of
the Property Trustee occurs and is continuing, the Property Trustee shall be
entitled to, for the benefit of Holders of the Securities, enforce its rights as
holder of the Senior Notes subject to the rights of the Holders pursuant to the
terms of the Securities and this Agreement.
(h) The Property Trustee shall be authorized to undertake any actions
set forth in ss. 317(a) of the Trust Indenture Act.
(i) For such time as the Property Trustee is the Paying Agent, the
Property Trustee may authorize one or more Persons to act as additional Paying
Agents and to pay Distributions, redemption payments or liquidation payments on
behalf of the Trust with respect to all Securities and any such Paying Agent
shall comply with ss. 317(b) of the Trust Indenture Act. Any such additional
Paying Agent may be removed by the Property Trustee at any time the Property
Trustee remains as Paying Agent and a successor Paying Agent or additional
Paying Agents may be (but are not required to be) appointed at any time by the
Property Trustee while the Property Trustee is acting as Paying Agent.
(j) Subject to this Section 3.08, the Property Trustee shall have none
of the duties, liabilities, powers or the authority of the Administrative
Trustees set forth in Section 3.06.
Notwithstanding anything expressed or implied to the contrary in this
Agreement or any Annex or Exhibit hereto, the Property Trustee shall exercise
the powers set forth in this Section 3.08 in a manner that is consistent with
the purposes and functions of the Trust set forth in Section 3.03.
SECTION 3.09. Certain Duties and Responsibilities of the Property
Trustee. (a) The Property Trustee, before the occurrence of any Event of Default
and after the curing or waiving of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Agreement and in the Securities and no implied covenants or obligations
shall be read into this Agreement against the Property Trustee. In case an Event
of Default has occurred (that has not been cured or waived pursuant to Section
2.06) of which a Responsible Officer of the Property Trustee has actual
knowledge, the Property Trustee shall exercise such of the rights and powers
vested in it by this
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Agreement, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(b) No provision of this Agreement shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act, its own bad faith or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Property Trustee
shall be determined solely by the express provisions of this
Agreement and of the Securities and the Property Trustee shall
not be liable except for the performance of such duties and
obligations as are specifically set forth in this Agreement and
in the Securities, and no implied covenants or obligations shall
be read into this Agreement against the Property Trustee; and
(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively rely, as
to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Property Trustee and conforming to the
requirements of this Agreement; provided that in the case of any
such certificates or opinions that by any provision hereof are
specifically required to be furnished to the Property Trustee,
the Property Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Agreement (but shall not be required to confirm or investigate
the accuracy of mathematical calculations or other facts stated
therein);
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of a Majority in
Liquidation Amount of the Securities relating to the time, method and
place of conducting any proceeding for any remedy available to the
Property Trustee, or exercising
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any trust or power conferred upon the Property Trustee under this
Agreement;
(iv) no provision of this Agreement shall require the Property
Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that the repayment of such funds or liability is
not reasonably assured to it under the terms of this Agreement or
indemnity reasonably satisfactory to the Property Trustee against such
risk or liability is not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the
custody, safekeeping and physical preservation of the Senior Notes and
the Property Trustee Account shall be to deal with such property in a
similar manner as the Property Trustee deals with similar property for
its own account, subject to the protections and limitations on
liability afforded to the Property Trustee under this Agreement and the
Trust Indenture Act;
(vi) the Property Trustee shall have no duty or liability for
or with respect to the value, genuineness, existence or sufficiency of
the Senior Notes or the payment of any taxes or assessments levied
thereon or in connection therewith;
(vii) the Property Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree in writing
with the Sponsor. Money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the
Property Trustee Account maintained by the Property Trustee pursuant to
Section 3.08(c)(i) and except to the extent otherwise required by law;
and
(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the Sponsor
with their respective duties under this Agreement, nor shall the
Property Trustee be liable for any default, negligence or misconduct of
the Administrative Trustees or the Sponsor.
Section 3.10. Certain Rights of Property Trustee. (a) Subject to the
provisions of Section 3.09:
(i) the Property Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report,
notice, request,
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direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document (whether in its original or
facsimile form) believed by it to be genuine and to have been signed,
sent or presented by the proper party or parties;
(ii) any direction or act of the Sponsor, the Guarantor or the
Administrative Trustees contemplated by this Agreement may be
sufficiently evidenced by an Officers' Certificate;
(iii) whenever in the administration of this Agreement, the
Property Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder,
the Property Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Sponsor or the
Administrative Trustees;
(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or
securities laws) or any re-recording, refiling or registration thereof;
(v) the Property Trustee may consult with counsel or other
experts of its selection and the advice or opinion of such counsel and
experts with respect to legal matters or advice within the scope of
such experts' area of expertise shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with such
advice or opinion; such counsel may be counsel to the Sponsor or the
Property Trustee or any of its Affiliates, and may include any of its
employees; and the Property Trustee shall have the right at any time to
seek instructions concerning the administration of this Agreement from
any court of competent jurisdiction;
(vi) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Agreement at
the request or direction of any Holder, unless such Holder shall have
provided to the Property Trustee security and indemnity, reasonably
satisfactory to the Property Trustee, against the costs, expenses
(including reasonable attorneys' fees and expenses and the expenses of
the Property Trustee's agents, nominees or custodians) and liabilities
that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by
the Property Trustee provided, that, nothing contained in this Section
3.10(a)(vi) shall be taken to relieve the
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Property Trustee, upon the occurrence of an Event of Default, of its
obligation to exercise the rights and powers vested in it by this
Agreement;
(vii) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Property Trustee, in
its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit;
(viii) the Property Trustee may execute any of the powers
hereunder or perform any duties hereunder either directly or by or
through agents, custodians, nominees or attorneys and the Property
Trustee shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it
hereunder;
(ix) any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders of the Securities, and
the signature of the Property Trustee or its agents alone shall be
sufficient and effective to perform any such action and no third party
shall be required to inquire as to the authority of the Property
Trustee to so act or as to its compliance with any of the terms and
provisions of this Agreement, both of which shall be conclusively
evidenced by the Property Trustee's or its agent's taking such action;
(x) whenever in the administration of this Agreement the
Property Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action
hereunder, the Property Trustee (i) may request instructions from the
Holders of the Securities which instructions may only be given by the
Holders of the same proportion in Liquidation Amount of the Securities
as would be entitled to direct the Property Trustee under the terms of
the Securities in respect of such remedy, right or action, (ii) may
refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be protected in
conclusively relying on, or acting in accordance with, such
instructions;
(xi) except as otherwise expressly provided by this Agreement,
the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Agreement;
(xii) the Property Trustee shall not be liable for any action
taken, suffered, or omitted to be taken by it in good faith, without
negligence, and
32
reasonably believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement; and
(xiii) the rights, privileges, protections, immunities and
benefits given to the Property Trustee, including, without limitation,
its right to be indemnified, are extended to, and shall be enforceable
by, the Property Trustee in each of its capacities hereunder, and to
each agent, custodian and other Person employed to act hereunder.
(b) No provision of this Agreement shall be deemed to impose any duty
or obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
SECTION 3.11. Delaware Trustee. (a) Notwithstanding any other provision
of this Agreement other than Section 5.02, 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 Administrative Trustees or the Property
Trustee described in this Agreement (except as required under the Business Trust
Act). Except as set forth in Section 5.02, the Delaware Trustee shall be a
Trustee for the sole and limited purpose of fulfilling the requirements of ss.
3807 of the Business Trust Act. It is expressly understood and agreed by the
parties hereto that in fulfilling its obligations as Delaware Trustee hereunder
on behalf of the Trust (i) any agreements or instruments executed and delivered
by Chase Manhattan Bank USA, National Association are executed and delivered not
in its individual capacity but solely as Delaware Trustee under this Trust
Agreement in the exercise of the powers and authority conferred and vested in
it, (ii) each of the representations, undertakings and agreements herein made on
the part of the Trust is made and intended not as representations, warranties,
covenants, undertakings and agreements by Chase Manhattan Bank USA, National
Association in its individual capacity but is made and intended for the purpose
of binding only the Trust, and (iii) under no circumstances shall Chase
Manhattan Bank USA, National Association in its individual capacity be
personally liable for the payment of any indebtedness or expenses of the Trust
or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Trust under this Trust Agreement,
except if such breach or failure is due to any gross negligence or willful
misconduct of the Delaware Trustee.
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Section 3.12. Execution of Documents. Except as otherwise required by
the Business Trust Act or applicable law, and except as otherwise expressly set
forth in this Agreement, each Administrative Trustee, individually, is
authorized to execute and deliver on behalf of the Trust any documents,
agreements, instruments or certificates that the Administrative Trustees have
the power and authority to execute and deliver pursuant to this Agreement.
Section 3.13. Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Agreement and of the Securities shall be taken as
the statements of the Sponsor, and the Trustees do not assume any responsibility
for their correctness. The Trustees make no representations as to the value or
condition of the property of the Trust or any part thereof. The Trustees make no
representations as to the validity or sufficiency of this Agreement or the
Securities.
Section 3.14. Duration of Trust. The Trust, unless dissolved pursuant
to the provisions of Article 8 hereof, shall exist until September 21, 2007.
Section 3.15. Mergers. (a) The Trust may not merge with or into,
convert into, consolidate, amalgamate, or be replaced by, or convey, transfer or
lease its properties and assets as an entirety or substantially as an entirety
to any Person, except as described in Section 3.15(b) and 3.15(c) and except
with respect to the distribution of all Senior Notes to Holders of Securities
pursuant to Section 8.01(a)(iii) or Section 4 of Annex I.
(b) The Trust may, at the request of the Sponsor, with the consent of
the Administrative Trustees or, if there are more than two, a majority of the
Administrative Trustees and without the consent of the Holders of the
Securities, the Delaware Trustee or the Property Trustee, merge with or into,
convert into, consolidate, amalgamate, or be replaced by, or convey, transfer or
lease its properties and assets as an entirety or substantially as an entirety
to, a trust organized as such under the laws of any State; provided that:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the Trust
under the Securities; or
(B) substitutes for the Securities other securities
having substantially the same terms as the Securities (the
"Successor Securities") so long as the Successor Securities
rank the same as the Securities rank with respect to
Distributions and payments upon liquidation, redemption and
otherwise;
34
(ii) the Sponsor expressly appoints a trustee of the Successor
Entity that possesses the same powers and duties as the Property
Trustee with respect to the Senior Notes;
(iii) the Successor Securities (excluding any securities
substituted for any Common Securities) are listed, quoted or included
for trading, or any Successor Securities will be listed, quoted or
included for trading, upon notification of issuance, on any
organization on which the Preferred Securities are then listed, quoted
or included;
(iv) such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause the Preferred
Securities (including any Successor Securities) or the Senior Notes to
be downgraded or placed under surveillance or review by any nationally
recognized statistical rating organization that publishes a rating on
the Preferred Securities or the Senior Notes;
(v) such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect
the rights, preferences and privileges of the Holders of the Securities
(including the Holders of any Successor Securities) in any material
respect (other than with respect to any dilution of the interests of
such Holders or Holder of Successor Securities, as the case may be, in
the Successor Entity);
(vi) the Successor Entity has a purpose substantially identical
to that of the Trust;
(vii) prior to such merger, conversion, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the Sponsor
has received an opinion of a nationally recognized independent counsel
to the Trust experienced in such matters to the effect that:
(A) such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the Holders
of the Securities (including the Holders of any Successor
Securities) in any material respect (other than with respect
to any dilution of the interests of such Holders or Holders of
Successor Securities, as the case may be, in the Successor
Entity); and
35
(B) following such merger, conversion, consolidation,
amalgamation, replacement, conveyance, transfer or lease,
neither the Trust nor the Successor Entity, if any, will be
required to register as an Investment Company; and
(viii) the Sponsor or any permitted successor or assignee owns
all of the common securities of the Successor Entity and guarantees the
obligations of the Successor Entity under the Successor Securities at
least to the extent provided by the Preferred Securities Guarantee and
the Common Securities Guarantee.
(c) Notwithstanding Section 3.15(b), the Trust may not merge with or
into, convert into, consolidate or amalgamate with or be replaced by, or convey,
transfer or lease its properties and assets as an entirety or substantially as
an entirety to, any other Person unless (i) the Administrative Trustees receive
an opinion of independent tax counsel experienced in such matters to the effect
that such merger, consolidation, amalgamation, replacement, conveyance, transfer
or lease will not cause the Trust or the Successor Entity, if any, not to be
classified as a grantor trust for United States Federal income tax purposes or
(ii) the Holders of 100% in Liquidation Amount of the Securities consent to such
merger, conversion, consolidation, amalgamation, replacement, conveyance,
transfer or lease.
ARTICLE 4
SPONSOR
Section 4.01. Sponsor's Purchase of Common Securities. On the Closing
Date, the Sponsor will purchase all of the Common Securities then issued by the
Trust, in an amount equal to at least 3% of the total capital of the Trust, at
the same time as the Preferred Securities are issued and sold. The aggregate
Liquidation Amount of Common Securities at any time shall not be less than 3% of
the capital of the Trust.
Section 4.02. Covenants of the Common Securities Holder. For so long as
the Preferred Securities remain outstanding, the Holder of the Common Securities
shall covenant (i) to maintain, directly or indirectly, 100% ownership of the
Common Securities; provided that any permitted successor of the Holder of the
Common Securities under the Indenture may succeed to such Holder's interest in
the Common Securities, (ii) to cause the Trust to remain a statutory business
trust, except in connection with a distribution of Senior Notes to the Holders
of Securities, the redemption of all of the Securities, or certain mergers,
36
consolidations, conversions or amalgamations, each as permitted by this
Agreement, and not to voluntarily dissolve, wind up, liquidate or be terminated,
except as permitted by this Agreement, (iii) to use its best efforts to ensure
that the Trust shall not be an investment company for purposes of the Investment
Company Act, and (iv) to take no action which would be reasonably likely to
cause the Trust to be classified as an association or a publicly traded
partnership taxable as a corporation for United States federal income tax
purposes.
Section 4.03. Responsibilities of the Sponsor. In connection with the
initial issuance and sale and the Remarketing of the Preferred Securities, the
Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
(a) prepare, if necessary, an offering memorandum (the "Offering
Memorandum") in preliminary and final form, pertaining to the Remarketing of the
Preferred Securities to a Secondary Purchaser;
(b) if the Preferred Securities are to be held in book-entry form,
prepare for execution and delivery by the Trust of letters, documents or
instruments to a Depository for the Preferred Securities;
(c) determine the jurisdictions in which to take appropriate action to
qualify or register for sale all or part of the Preferred Securities and to do
any and all such acts, other than actions which must be taken by the Trust, and
advise the Trust of actions it must take, and prepare for execution and filing
any documents to be executed and filed by the Trust, as the Sponsor deems
necessary or advisable in order to comply with the applicable laws of any such
jurisdictions; and
(d) negotiate the terms of, enter into, sign on behalf of the Trust
and deliver and perform the Purchase Agreement, in the form of Exhibit C,
providing for the sale of the Preferred Securities, the Remarketing Agreement in
the form of Exhibit D, providing for the Remarketing of the Preferred
Securities, or under certain circumstances, the Senior Notes, and the Secondary
Purchase Agreement providing for the resale of the Preferred Securities.
Section 4.04. Right to Proceed. The Sponsor acknowledges the rights of
the Holders of Preferred Securities to take Direct Action referred to in Section
3.08(e) and Annex I.
37
ARTICLE 5
Trustees
Section 5.01. Number of Trustees; Appointment of Co-Trustee. The number
of Trustees initially shall be two (2), and:
(a) at any time before the issuance of any Securities, the Sponsor may,
by written instrument, increase or decrease the number of Trustees; and
(b) after the issuance of any Securities, the number of Trustees may
be increased or decreased by vote of the Holders of a Majority in Liquidation
Amount of the Common Securities voting as a class at a meeting of the Holders of
the Common Securities; provided that the number of Trustees shall in no event be
fewer than two (2), and provided further that (i) one Trustee shall be a Person
meeting the requirements of Section 5.02 (the "Delaware Trustee"); (ii) there
shall be at least one Trustee who is an employee or officer of, or is affiliated
with the Sponsor (an "Administrative Trustee"); and (iii) one Trustee shall be
the Property Trustee, and such Trustee may also serve as Delaware Trustee if it
meets the applicable requirements. Notwithstanding the above, unless an Event of
Default shall have occurred and be continuing, at any time or times, for the
purpose of meeting the legal requirements of the Trust Indenture Act or of any
jurisdiction in which any part of the Trust's property may at the time be
located, the Holders of a Majority in Liquidation Amount of the Common
Securities acting as a class at a meeting of the Holders of the Common
Securities, and the Administrative Trustees shall have power to appoint one or
more Persons meeting the requirements of Section 5.03 either to act as a
co-trustee, jointly with the Property Trustee, of all or any part of the Trust's
property, or to act as separate trustee of any such property, in either case
with such powers as may be provided in the instrument of appointment, and to
vest in such Person or Persons in such capacity any property, title, right or
power deemed necessary or desirable, subject to the provisions of this
Agreement. In case an Event of Default has occurred and is continuing, the
Property Trustee alone shall have power to make any such appointment of a
co-trustee.
Section 5.02. Delaware Trustee. For so long as required by the Business
Trust Act, the Delaware Trustee shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place
of business in the State of Delaware, and otherwise meets the requirements of
applicable law,
38
provided, however, if the Property Trustee has its principal place of business
in the State of Delaware and otherwise meets the requirements of applicable law,
then the Property Trustee shall also be the Delaware Trustee and Section 3.11
shall have no application.
Section 5.03. Property Trustee; Eligibility. (a) There shall at all
times be one Trustee (the "Property Trustee") which shall act as Property
Trustee and which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof
or of the District of Columbia, or a corporation or Person permitted by
the Commission to act as an indenture trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least $50,000,000, and
subject to supervision or examination by federal, state, territorial or
District of Columbia authority. If such corporation publishes reports
of condition at least annually, pursuant to law or to the requirements
of the supervising or examining authority referred to above, then for
the purposes of this Section 5.03(a)(ii), the combined capital and
surplus of such corporation shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Property Trustee shall cease to be eligible to
so act under Section 5.03(a), the Property Trustee shall immediately resign in
the manner and with the effect set forth in Section 5.07(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of ss. 310(b) of the Trust Indenture Act, the
Property Trustee and the Holder of the Common Securities (as if it were the
obligor referred to in ss. 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of ss. 310(b) of the Trust Indenture Act,
subject to the penultimate paragraph thereof.
(d) The Preferred Securities Guarantee shall be deemed to be
specifically described in this Agreement for purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
(e) The initial Property Trustee shall be:
The Chase Manhattan Bank
39
▇▇▇ ▇▇▇▇ ▇▇/▇▇/ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Capital Markets Fiduciary Services
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇/8162
Section 5.04. Certain Qualifications of Administrative Trustees and
Delaware Trustee Generally. Each Administrative Trustee and the Delaware Trustee
(unless the Property Trustee also acts as Delaware Trustee) shall be either a
natural person who is at least 21 years of age or a legal entity that shall act
through one or more Authorized Officers.
Section 5.05. Administrative Trustees. The initial Administrative
Trustees shall be:
▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
c/o Mutual Group Ltd.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
(a) Except as expressly set forth in this Agreement and except if a
meeting of the Administrative Trustees is called with respect to any matter over
which the Administrative Trustees have power to act, any power of the
Administrative Trustees may be exercised by, or with the consent of, any one
such Administrative Trustee.
(b) Except as otherwise required by the Business Trust Act or
applicable law, any Administrative Trustee acting alone is authorized to execute
on behalf of the Trust any documents which the Administrative Trustees have the
power and authority to cause the Trust to execute pursuant to Section 3.06.
Section 5.06. Delaware Trustee. The initial Delaware Trustee shall be:
Chase Manhattan Bank USA, National Association
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇/▇▇/ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Capital Markets Fiduciary Services
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
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SECTION 5.07. Appointment, Removal and Resignation of Trustees. (a)
Subject to Sections 5.07(b) and (c), Trustees may be appointed or removed at any
time:
(i) with or without cause until the issuance of any
Securities, by written instrument executed by the Sponsor;
(ii) unless an Event of Default shall have occurred and be
continuing after the issuance of any Securities, with or without cause
by vote of the Holders of a Majority in Liquidation Amount of the
Common Securities voting as a class at a meeting of the Holders of the
Common Securities; and
(iii) if an Event of Default shall have occurred and be
continuing after the issuance of the Securities, (A) with or without
cause with respect to the Property Trustee or the Delaware Trustee (but
not any Administrative Trustee), by vote of Holders of a Majority in
Liquidation Amount of the Preferred Securities voting as a class at a
meeting of Holders of the Preferred Securities and (B) with or without
cause with respect to an Administrative Trustee, by vote of the Holders
of a Majority in Liquidation Amount of the Common Securities voting as
a class at a meeting of the Holders of the Common Securities.
(b) (i) The Trustee that acts as Property Trustee shall not be removed
in accordance with Section 5.07(a) until a Successor Property Trustee has been
appointed and has accepted such appointment by written instrument executed by
such Successor Property Trustee and delivered to the Administrative Trustees and
the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall not be
removed in accordance with Section 5.07(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections
5.02 and 5.04 (a "Successor Delaware Trustee") has been appointed and
has accepted such appointment by written instrument executed by such
Successor Delaware Trustee and delivered to the removed Delaware
Trustee, the Property Trustee (if the removed Delaware Trustee is not
also the Property Trustee), the Administrative Trustees and the
Sponsor.
(c) A Trustee appointed to office shall hold office until his successor
shall have been appointed or until his death, removal or resignation. Any
Trustee may resign from office (without need for prior or subsequent accounting)
by an instrument in writing signed by the Trustee and delivered to the other
Trustees,
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the Sponsor and the Trust, which resignation shall take effect upon such
delivery or upon such later date as is specified therein; provided that:
(i) no such resignation of the Trustee that acts as the
Property Trustee shall be effective:
(A) until a Successor Property Trustee has been appointed
and has accepted such appointment by instrument executed by such
Successor Property Trustee and delivered to the Trust, the
Sponsor, the Delaware Trustee (if the resigning Property Trustee
is not also the Delaware Trustee) and the resigning Property
Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the Holders of
the Securities; and
(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor Delaware Trustee
has been appointed and has accepted such appointment by instrument
executed by such Successor Delaware Trustee and delivered to the Trust,
the Property Trustee (if the resigning Delaware Trustee is not also the
Property Trustee), the Sponsor and the resigning Delaware Trustee.
(d) The Holders of the Common Securities or, if an Event of Default
shall have occurred and be continuing after the issuance of the Securities, the
Holders of the Preferred Securities shall use their best efforts to promptly
appoint a Successor Delaware Trustee or Successor Property Trustee, as the case
may be, if the Property Trustee or the Delaware Trustee delivers an instrument
of resignation in accordance with this Section 5.07.
(e) If no Successor Property Trustee or Successor Delaware Trustee
shall have been appointed and accepted appointment as provided in this Section
5.07 within 60 days after delivery of an instrument of resignation or removal,
the Property Trustee or Delaware Trustee resigning or being removed, as
applicable, may petition at the expense of the Sponsor any court of competent
jurisdiction for appointment of a Successor Property Trustee or Successor
Delaware Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper and prescribe, appoint a Successor Property Trustee
or Successor Delaware Trustee, as the case may be.
(f) No former Property Trustee or former Delaware Trustee shall be
liable for the acts or omissions to act of any Successor Property Trustee or
Successor Delaware Trustee, as the case may be.
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SECTION 5.08. Vacancies Among Trustees. If a Trustee ceases to hold
office for any reason and the number of Trustees is not reduced pursuant to
Section 5.01, or if the number of Trustees is increased pursuant to Section
5.01, a vacancy shall occur. A resolution certifying the existence of such
vacancy by the Administrative Trustees or, if there are more than two, a
majority of the Administrative Trustees shall be conclusive evidence of the
existence of such vacancy. The vacancy shall be filled with a Trustee appointed
in accordance with Section 5.07.
SECTION 5.09. Effect of Vacancies. The death, resignation, retirement,
removal, bankruptcy, dissolution, liquidation, incompetence or incapacity to
perform the duties of a Trustee shall not operate to dissolve, terminate or
annul the Trust or to terminate this Agreement. Whenever a vacancy in the number
of Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 5.07, the
Administrative Trustees in office, regardless of their number, shall have all
the powers granted to the Administrative Trustees and shall discharge all the
duties imposed upon the Administrative Trustees by this Agreement.
SECTION 5.10. Meetings. If there is more than one Administrative
Trustee, meetings of the Administrative Trustees shall be held from time to time
upon the call of any Administrative Trustee. Regular meetings of the
Administrative Trustees may be held at a time and place fixed by resolution of
the Administrative Trustees. Notice of any in-person meetings of the
Administrative Trustees shall be hand delivered or otherwise delivered in
writing (including by facsimile, with a hard copy by overnight courier) not less
than 24 hours before such meeting. Notice of any telephonic meetings of the
Administrative Trustees or any committee thereof shall be hand delivered or
otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 24 hours before a meeting. Notices shall
contain a brief statement of the time, place and anticipated purposes of the
meeting. The presence (whether in person or by telephone) of an Administrative
Trustee at a meeting shall constitute a waiver of notice of such meeting except
where an Administrative Trustee attends a meeting for the express purpose of
objecting to the transaction of any activity on the ground that the meeting has
not been lawfully called or convened. Unless provided otherwise in this
Agreement, any action of the Administrative Trustees may be taken at a meeting
by vote of a majority of the Administrative Trustees present (whether in person
or by telephone) and eligible to vote with respect to such matter; provided that
a Quorum is present, or without a meeting and without prior notice, by the
majority written consent of the Administrative Trustees. If there is only one
Administrative Trustee, any and all action of such
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Administrative Trustee shall be evidenced by a written consent of such
Administrative Trustee.
SECTION 5.11. Delegation of Power. (a) Any Administrative Trustee may,
by power of attorney consistent with applicable law, delegate to any other
natural person over the age of 21 his or her power for the purpose of executing
any documents contemplated in Section 3.06; and
----
(b) The Administrative Trustees shall have power to delegate from time
to time to such of their number or to officers of the Trust the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Administrative Trustees or otherwise as the Administrative
Trustees may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of this Agreement.
SECTION 5.12. Merger, Conversion, Consolidation or Succession to
Business. Any Person into which the Property Trustee or the Delaware Trustee or
any Administrative Trustee that is not a natural person, as the case may be, may
be merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which the Property
Trustee or the Delaware Trustee, as the case may be, shall be a party, or any
Person succeeding to all or substantially all the corporate trust business of
the Property Trustee or the Delaware Trustee, as the case may be, shall be the
successor of the Property Trustee or the Delaware Trustee, as the case may be,
hereunder; provided that 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; provided further that such
successor shall notify the Sponsor and the Trust promptly of its succession.
SECTION 5.13. Compensation. The Sponsor agrees:
(a) to pay to the Property Trustee and the Delaware Trustee from time
to time such compensation as shall be agreed in writing between the Sponsor and
the Property Trustee and the Delaware Trustee, respectively, 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); and
(b) to reimburse the Property Trustee and the Delaware Trustee upon
their request for expenses, disbursements and advances incurred or made by the
Property Trustee or the Delaware Trustee, respectively, in accordance with any
provision of this Agreement (including the reasonable compensation and the
expenses and advances of its agents and counsel), except any such expense or
advance as may be attributable to their negligence or willful misconduct.
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ARTICLE 6
DISTRIBUTIONS; RESET RATE; REMARKETING; MANDATORY REDEMPTION
SECTION 6.01. Distributions. Holders shall receive Distributions in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Securities in accordance with the respective
terms and preferences set forth below and in Annex I. If and to the extent that
the Senior Note Issuer makes a payment of interest (including Additional
Interest as defined in the Supplemental Indenture), premium and/or principal on
the Senior Notes held by the Property Trustee (the amount of any such payment
being a "Payment Amount"), the Property Trustee shall and is directed, to the
extent funds are available for that purpose, to make a distribution (a
"Distribution") of the Payment Amount to Holders.
SECTION 6.02. Remarketing Procedures.
(a) (i) Subject to Section 6.04, if (x) the Closing Price of the
Common Shares on any Trading Day is less than the Trigger Price or (y)
a Cross Default occurs (each, a "Trigger Event"), the Holders of a
Majority in Liquidation Amount of the Securities, acting together as a
single class (the "Requesting Holders") will have the right to require
remarketing of the Preferred Securities. The Requesting Holders may
exercise this right by delivering a written notice to the Remarketing
Agent at any time on or prior to the sixth Business Day following the
date on which such Trigger Event occurs. Upon the receipt of such
notice, the Remarketing Agent shall immediately deliver a written
notice to the Sponsor on behalf of the Requesting Holders (the
"Remarketing Notice"). If the Requesting Holders exercise their right
to require the remarketing of the Preferred Securities, the Reset Date
shall be the sixth Business Day after the date on which the Remarketing
Notice is delivered by the Remarketing Agent (the "Expected Reset
Date").
(ii) If the Requesting Holders do not exercise their right to
require the remarketing of the Preferred Securities pursuant to Section
6.02(a)(i) with respect to any Trigger Event, the Requesting Holders
shall continue to have the right to require the remarketing of the
Preferred Securities, in accordance with Section 6.02(a)(i), with
respect to any subsequent Trigger Event.
(iii) Notwithstanding Section 6.02(a)(i):
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(A) the Sponsor may, by notice to the Remarketing Agent,
direct that the Reset Date be delayed if the Sponsor believes
it will be unable to meet the conditions to Remarketing in the
absence of such a delay; and
(B) the Remarketing Agent may, by notice to the Sponsor,
direct that the Reset Date be delayed if the Remarketing Agent
believes that a Remarketing will not be successful in the
absence of such a delay;
provided that the Sponsor and the Remarketing Agent, in either such
event, will use their reasonable best efforts to establish a delayed
Reset Date that is within five Business Days after the Expected Reset
Date, but in no event later than the 15th Business Day following the
date on which the related Remarketing Notice was delivered, or the 20th
Business Day in the case of a Renewed Remarketing to which the
provisions of Section 6.04 are applicable (as applicable, the "Final
Reset Date").
(iv) If the Sponsor and the Remarketing Agent have not agreed,
on or prior to the sixth Business Day preceding the Final Reset Date,
to a Reset Date that is not later than the Final Reset Date, a Failed
Remarketing shall be deemed to have occurred.
(b) The Sponsor shall, by notice to the Remarketing Agent no later
than five Business Days prior to the Reset Date, select and specify five
Reference Corporate Dealers. By 3:00 p.m., New York City time, on the Reset
Date, the Remarketing Agent shall request Bids from such Reference Corporate
Dealers. The Remarketing Agent or an Affiliate or Associated Person thereof (any
such person, an "Affiliated Bidder") may, at its option, also enter a Bid. The
Remarketing Agent shall disclose to the Sponsor the Bids obtained and determine
the lowest Bid Rate (the "Winning Bid Rate") from among the Bids obtained on the
Reset Date. By approximately 4:30 p.m., New York City time, on the Reset Date,
the Remarketing Agent shall notify the Sponsor and the Property Trustee of the
Winning Bid Rate. If on a Reset Date, Bids are not submitted by at least two
Reference Corporate Dealers, or if the lowest Bid submitted would result in a
Winning Bid Rate in excess of the rate permitted by applicable law, such
Remarketing shall be deemed to be a Failed Remarketing on the corresponding
Remarketing Settlement Date. The Winning Bid Rate determined by the Remarketing
Agent, absent manifest error, shall be binding and conclusive upon the Holders
of the Trust Securities, the Sponsor, the Guarantor and the Trust.
(c) On the Reset Date, the Remarketing Agent shall designate as the
Secondary Purchaser (the "Secondary Purchaser") the Reference Corporate Dealer
providing the Bid containing the Winning Bid Rate. If the Winning Bid
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Rate is specified in the Bids submitted by two or more bidders, the Remarketing
Agent shall, in consultation with the Sponsor, designate one of such bidders as
the Secondary Purchaser.
(d) On the Reset Date, the Secondary Purchaser shall enter into a
Secondary Purchase Agreement for the purchase by such Secondary Purchaser at the
Remarketing Price of the aggregate Liquidation Amount of the Preferred
Securities, with a Distribution Rate equal to the Winning Bid Rate and with a
Mandatory Redemption Date on the Remarketed Maturity Date.
(e) If a Remarketing has occurred pursuant to this Section 6.02 but
settlement of the purchase and sale of the Preferred Securities does not occur
on the corresponding Remarketing Settlement Date, then, unless the provisions of
Section 6.04 with respect to a Renewed Remarketing shall apply, a Failed
Remarketing shall be deemed to have occurred on such Remarketing Settlement
Date.
(f) At the time and in the manner specified in the Secondary Purchase
Agreement, the Secondary Purchaser shall pay on the Remarketing Settlement Date
to the Remarketing Agent on behalf of the Holders of the Preferred Securities,
an amount of cash equal to the Remarketing Price.
(g) Unless otherwise agreed among the Remarketing Agent, the Paying
Agent and any Former Holder, the Remarketing Agent shall pay the Remarketing
Price, less the Remarketing Fee, to the Paying Agent, acting solely as agent for
the Former Holders, and the Paying Agent shall promptly pay such amounts to the
Former Holders on the Remarketing Settlement Date in the manner specified in
Section 5(h) of Annex I hereto for payments with respect to redemptions of the
Preferred Securities. Any amounts held by the Paying Agent for payment to the
Former Holders shall not be property of the Trust.
(h) The obligation of the Remarketing Agent to make payment to the
Former Holders in connection with the Remarketing shall be limited to the extent
that the Secondary Purchaser has delivered the Remarketing Price therefor to the
Remarketing Agent.
(i) Any outstanding Preferred Securities purchased on the Remarketing
Settlement Date shall be deemed to be transferred to the Secondary Purchaser and
shall be replaced in the manner provided in Section 6.02(j). After the
Remarketing Settlement Date (except in the event of (x) a Failed Remarketing or
(y) a failure by the Trust to pay on the Remarketing Settlement Date all accrued
and unpaid Distributions (including any Additional Distributions) to such
Remarketing Settlement Date), (i) the Trust shall make no further payments to,
and the Trust shall have no further obligations under this Agreement in respect
of,
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the Holders of such replaced Preferred Securities (the "Former Holders"), (ii)
the Trust shall only be obligated to make payments to the Holders of Replacement
Securities and (iii) the Preferred Securities of the Former Holders shall no
longer represent an obligation of or interest in the Trust but shall only
represent a right to receive the proceeds of the Remarketing from the Paying
Agent.
(j) The Sponsor shall cause replacement certificates evidencing the
remarketed Preferred Securities (the "Replacement Securities") to be executed by
an Administrative Trustee on behalf of the Trust and authenticated by the
Property Trustee in accordance with the provisions of Section 7.03. The
Replacement Securities shall be delivered to the purchaser or purchasers of the
remarketed Preferred Securities in accordance with the terms of the Secondary
Purchase Agreement.
SECTION 6.03. Reset of Distribution Rate and Mandatory Redemption Date.
Unless a Failed Remarketing shall have occurred, from and including the
Remarketing Settlement Date on which Replacement Securities are issued, the
Distribution Rate on the Securities shall be the Winning Bid Rate and the
Mandatory Redemption Date shall be the Remarketed Maturity Date.
SECTION 6.04. Renewed Remarketing. If a Remarketing has occurred
pursuant to Section 6.02 that would be a Failed Remarketing pursuant to Section
6.02(e), because the purchase and sale of the Preferred Securities do not take
place on the corresponding Remarketing Settlement Date, and such failure, in the
good faith determination of the Remarketing Agent (made after consultation with
the Sponsor), results from facts or circumstances other than the action or
inaction of the Sponsor, then the provisions of Section 6.02 shall apply to a
second remarketing (a "Renewed Remarketing") of the Preferred Securities, except
that the Expected Reset Date shall be the sixth Business Day following such
corresponding Remarketing Settlement Date; provided that upon the occurrence of
a Failed Remarketing pursuant to Section 6.02(e), only one Renewed Remarketing
may occur pursuant to this Section 6.04, and no Renewed Remarketing shall occur
after the Final Reset Date.
SECTION 6.05. Failed Remarketing. The Remarketing Agent shall give
notice of any Failed Remarketing on the date such Failed Remarketing occurs, or
is deemed to have occurred, by 4:00 p.m., New York City time, to the Sponsor,
the Guarantor, the Senior Note Trustee and the Property Trustee.
SECTION 6.06. Payment of Taxes, Duties, Etc. of the Trust. Upon receipt
under the Senior Notes of Additional Sums, the Property Trustee shall, at the
direction of the Administrative Trustees, promptly pay from such Additional Sums
any taxes, duties or governmental charges of whatever nature (other than
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withholding taxes) imposed on the Trust by the United States or any other taxing
authority.
SECTION 6.07. Adjustments to Trigger Price. The "Trigger Price" shall
initially be $13.50. Following the determination by the Calculation Agent in its
reasonable discretion that a Potential Adjustment Event has occurred, the
Calculation Agent shall determine (after consultation with the Guarantor)
whether such Potential Adjustment Event has a dilutive or concentrative effect
on the theoretical value of the Common Shares and, if so, shall make the
corresponding adjustment(s), if any, to the Trigger Price. In accordance with
the terms of Section 10 of the Remarketing Agreement, the Guarantor shall
promptly notify the Calculation Agent of any Potential Adjustment Event. The
Calculation Agent may, but need not, determine the appropriate adjustment(s) by
reference to the adjustment(s) in respect of such Potential Adjustment Event
made by an options exchange to options on the Common Shares traded on that
options exchange. In the event of any merger, consolidation or reorganization of
the Guarantor, the Calculation Agent shall determine (after consultation with
the Guarantor) the appropriate Trigger Price as a result of such event.
ARTICLE 7
ISSUANCE OF SECURITIES
SECTION 7.01. General Provisions Regarding Securities. (a) The
Administrative Trustees shall on behalf of the Trust issue one class of
preferred securities representing undivided beneficial interests in the assets
of the Trust having such terms as are set forth in Annex I (the "Preferred
Securities" which term, for the avoidance of doubt, includes any Replacement
Securities) and one class of common securities representing undivided beneficial
interests in the assets of the Trust having such terms as are set forth in Annex
I (the "Common Securities"). The Trust shall issue no securities or other
interests in the assets of the Trust other than the Preferred Securities
(including Replacement Securities) and the Common Securities.
(b) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(c) Upon issuance of the Securities as provided in this Agreement, the
Securities so issued shall be validly issued, fully paid and non-assessable.
(d) Every Person, by virtue of having become a Holder or a Preferred
Security Beneficial Owner in accordance with the terms of this Agreement, shall
49
(i) be deemed to have expressly assented and agreed to the terms of, and shall
be bound by, this Agreement, including the terms of Annex I, Exhibits ▇-▇, ▇-▇,
▇-▇ and D and (ii) be deemed to have expressly appointed the Remarketing Agent
as its attorney-in-fact with respect to the transactions contemplated by the
Secondary Purchase Agreement.
SECTION 7.02. Execution and Authentication. (a) The Securities shall be
signed on behalf of the Trust by an Administrative Trustee. In case any
Administrative Trustee of the Trust who shall have signed any of the Securities
shall cease to be such Administrative Trustee before the Securities so signed
shall be delivered by the Trust, such Securities nevertheless may be delivered
as though the Person who signed such Securities had not ceased to be such
Administrative Trustee; and any Securities may be signed on behalf of the Trust
by such persons who, at the actual date of execution of such Security, shall be
the Administrative Trustees of the Trust, although at the date of the execution
and delivery of this Agreement any such person was not an Administrative
Trustee.
(b) One Administrative Trustee shall sign the Preferred Securities for
the Trust by manual or facsimile signature.
A Preferred Security shall not be valid until authenticated by the
manual signature of an authorized officer of the Property Trustee. The signature
shall be conclusive evidence that the Preferred Security has been authenticated
under this Agreement. A Common Security shall be valid upon execution by a
manual signature of an Administrative Trustee without any act of the Property
Trustee.
Upon a written order of the Trust signed by one Administrative Trustee,
the Property Trustee shall authenticate the Preferred Securities for original
issue.
The aggregate number of Preferred Securities outstanding at any time
shall not exceed the number set forth in the terms in Annex I hereto except as
provided in Section 7.07.
The Property Trustee may appoint an authenticating agent acceptable to
the Trust to authenticate Preferred Securities. An authenticating agent may
authenticate Preferred Securities whenever the Property Trustee may do so. Each
reference in this Agreement to authentication by the Property Trustee includes
authentication by such agent. An authenticating agent has the same rights as the
Property Trustee hereunder with respect to the Sponsor or an Affiliate.
SECTION 7.03. Form and Dating. (a) The initial Preferred Securities and
the Property Trustee's certificate of authentication shall be substantially in
the form of Exhibit A-1, the Replacement Securities shall be substantially in
the form of Exhibit A-3 and the Common Securities shall be substantially in the
form of
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Exhibit A-2, each of which is hereby incorporated in and expressly made a part
of this Agreement. The Preferred Securities shall be issued only in minimum
denominations of $100,000 Liquidation Amount and integral multiples of $1,000 in
excess thereof. The Securities may be in definitive or global form, and may be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to an Administrative Trustee, as evidenced by the
execution thereof. The Securities may have letters, CUSIP or other numbers,
notations or other marks of identification or designation and such legends or
endorsements required by law, stock exchange or quotation system rule,
agreements to which the Trust is subject, if any, or usage (provided that any
such notation, legend or endorsement is in a form acceptable to the Trust). An
Administrative Trustee, at the direction of the Sponsor, shall furnish any such
legend not contained in Exhibits ▇-▇, ▇-▇ or A-3 to the Property Trustee in
writing. Each Preferred Security shall be dated the date of its authentication.
The terms and provisions of the Securities set forth in Annex I and the forms of
Securities set forth in Exhibits ▇-▇, ▇-▇ and A-3 are part of the terms of this
Agreement and to the extent applicable, the Property Trustee and the Sponsor, by
their execution and delivery of this Agreement, expressly agree to such terms
and provisions and to be bound thereby.
(b) The Preferred Securities shall initially be issued in definitive
form ("Definitive Preferred Securities"). Upon Remarketing, the Preferred
Securities shall be issued as Replacement Securities in the form of one or more
permanent global Securities in definitive, fully registered form with the
appropriate global legends set forth in Exhibit A-3 hereto (a "Global Preferred
Security"), registered in the name of the Depository or a nominee of the
Depository, duly executed by an Administrative Trustee on behalf of the Trust
and authenticated by the Property Trustee as hereinafter provided. The number of
Preferred Securities represented by the Global Preferred Security may from time
to time be increased or decreased by adjustments made on the records of the
Property Trustee and the Depository or its nominee as hereinafter provided. The
Holder of a Global Preferred Security may grant proxies and otherwise authorize
any Person, including Participants, and Persons that may hold interests through
Participants, to take any action which such Holder is entitled to take under
this Agreement or the Securities.
(c) An Administrative Trustee shall execute and the Property Trustee
shall, in accordance with this Section 7.03, authenticate and make available for
delivery initially one or more Definitive Preferred Securities registered in the
name of the initial Holders or their designees. Upon Remarketing, an
Administrative Trustee shall execute and the Property Trustee shall, in
accordance with this Section 7.03, authenticate and make available for delivery
one or more Global Preferred Securities that (i) shall be registered in the name
of the Depository or a nominee of such Depository and (ii) shall be delivered by
the
51
Property Trustee to such Depository or pursuant to such Depository's written
instructions, or held by the Property Trustee as custodian for the Depository.
(d) Members of, or participants in, the Depository ("Participants")
shall have no rights under this Agreement with respect to any Global Preferred
Security held on their behalf by the Depository or by the Property Trustee as
the custodian of the Depository or under such Global Preferred Security, and the
Depository or its nominee may be treated by the Trust, the Property Trustee and
any agent of the Trust or the Property Trustee as the sole and absolute owner of
such Global Preferred Security for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Trust, the Property Trustee or any
agent of the Trust or the Property Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depository or
impair, as between the Depository and its Participants, the operation of
customary practices of such Depository governing the exercise of the rights of
an owner of a beneficial interest in any Global Preferred Security.
(e) Except in connection with the initial issuance of the Preferred
Securities and as further provided in Section 9.02, owners of beneficial
interests in a Global Preferred Security will not be entitled to receive
physical delivery of Definitive Preferred Securities.
SECTION 7.04. Registrar and Paying Agent. The Trust shall maintain in
the Borough of Manhattan, The City of New York, (i) an office or agency where
Preferred Securities may be presented for registration of transfer or exchange
("Registrar") and (ii) an office or agency where Preferred Securities may be
presented for payment ("Paying Agent"). The Registrar shall keep a register of
the Preferred Securities and of their transfer. The Trust may appoint the
Registrar and the Paying Agent and may appoint one or more co-registrars and one
or more additional paying agents in such other locations as it shall determine.
The term "Registrar" includes any additional registrar and the term "Paying
Agent" includes any additional paying agent. The Trust may change any Registrar
or Paying Agent without prior notice to any Holder. The Administrative Trustees
shall notify the Property Trustee of the name and address of any Agent not a
party to this Agreement. If the Trust fails to appoint or maintain another
entity as Registrar or Paying Agent, the Property Trustee shall act as such, and
as Paying Agent the Property Trustee shall have the rights set forth in Section
3.08(i). The Property Trustee or any of its Affiliates may act as Registrar or
Paying Agent. The Trust shall act as Registrar and Paying Agent for the Common
Securities.
Any Paying Agent shall be permitted to resign as Paying Agent upon 30
days' prior written notice to the Property Trustee, the Administrative Trustees
and the Sponsor. If the Property Trustee shall no longer be the Paying Agent,
the Trust shall appoint a successor Paying Agent (which shall be a bank or trust
52
company acceptable to the Sponsor) to act as Paying Agent. Any such resignation
shall become effective upon the appointment of a successor Paying Agent by the
Trust to perform the services that would otherwise be performed hereunder by the
Paying Agent and the agreement of any such successor so to serve.
The Trust initially appoints the Property Trustee as Registrar and
Paying Agent for the Preferred Securities.
SECTION 7.05. Paying Agent to Hold Money in Trust. Except as
contemplated by Section 6.02(g) hereof, the Trust shall require each Paying
Agent other than the Property Trustee to agree in writing that the Paying Agent
will hold in trust for the benefit of Holders or the Property Trustee all money
held by the Paying Agent for the payment of Liquidation Amounts or Distributions
on the Securities and will notify the Property Trustee if there are insufficient
funds for such purpose. While any such insufficiency continues, the Property
Trustee may require a Paying Agent to pay all money held by it to the Property
Trustee. The Trust at any time may require a Paying Agent to pay all money held
by it to the Property Trustee and to account for any money disbursed by it. Upon
payment over to the Property Trustee, the Paying Agent (if other than the Trust
or an Affiliate of the Trust) shall have no further liability for the money. If
the Trust or the Sponsor or an Affiliate of the Trust or the Sponsor acts as
Paying Agent, it shall segregate and hold in a separate trust fund for the
benefit of the Holders all money held by it as Paying Agent.
SECTION 7.06. Replacement of Securities. If a Holder of a Security
claims that a Security owned by it has been lost, destroyed or wrongfully taken
or if such Security is mutilated and is surrendered to the Trust or, in the case
of the Preferred Securities, to the Property Trustee, an Administrative Trustee
shall execute and, in the case of the Preferred Securities, the Property Trustee
shall authenticate and make available for delivery a replacement of such
Security if the Property Trustee's and the Trust's requirements, as the case may
be, are met. An indemnity bond must be provided by the Holder which, in the
judgment of the Property Trustee, is sufficient to protect the Trustees, the
Sponsor or any authenticating agent from any loss which any of them may suffer
if a Security is replaced. The Trust may charge such Holder for its expenses in
replacing a Security.
SECTION 7.07. Outstanding Preferred Securities. The Preferred
Securities outstanding at any time are all the Preferred Securities
authenticated by the Property Trustee except for those canceled by it, those
delivered to it for cancellation, and those described in this Section as not
outstanding.
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If a Preferred Security is replaced pursuant to Section 7.06 hereof, it
ceases to be outstanding unless the Property Trustee receives proof satisfactory
to it that the replaced Preferred Security is held by a bona fide purchaser.
If Preferred Securities are considered paid in accordance with the terms of
this Agreement, including any Preferred Securities replaced by Replacement
Securities in accordance with the provisions of Article 6, they cease to be
outstanding and Distributions thereon shall cease to accumulate.
Except to the extent set forth in the last paragraph of Section 6 of Annex
I and Section 7.08, a Preferred Security does not cease to be outstanding
because the Trust, the Sponsor or an Affiliate of the Sponsor holds such
Preferred Security.
Section 7.08. Preferred Securities in Treasury. In determining whether the
Holders of the required amount of Preferred Securities have concurred in any
direction, waiver or consent, Preferred Securities owned by the Trust, the
Sponsor or an Affiliate of the Sponsor, as the case may be, shall be disregarded
and deemed not to be outstanding, except that for the purposes of determining
whether the Property Trustee shall be fully protected in relying on any such
direction, waiver or consent, only Preferred Securities which a Responsible
Officer of the Property Trustee actually knows are so owned shall be so
disregarded.
Section 7.09. Temporary Securities. Until definitive Securities are ready
for delivery, the Administrative Trustees may prepare and, in the case of the
Preferred Securities, the Property Trustee shall authenticate temporary
Securities. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Trust considers
appropriate for temporary Securities. Without unreasonable delay, the
Administrative Trustees shall prepare and, in the case of the Preferred
Securities, the Property Trustee shall authenticate definitive Securities in
exchange for temporary Securities.
Section 7.10. Cancellation. The Trust at any time may deliver Preferred
Securities to the Property Trustee for cancellation. The Registrar and Paying
Agent shall forward to the Property Trustee any Preferred Securities surrendered
to them for registration of transfer, redemption, exchange or payment. The
Property Trustee shall promptly cancel all Preferred Securities surrendered for
registration of transfer, redemption, exchange, payment, replacement or
cancellation and shall dispose of canceled Preferred Securities as the Trust
directs; provided that the Property Trustee shall not be obligated to destroy
Preferred Securities. The Trust may not issue new Preferred Securities to
replace Preferred Securities that it has paid or redeemed or that have been
delivered to the Property Trustee for cancellation or that any Holder has
exchanged.
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Section 7.11. CUSIP Numbers. The Trust, in issuing the Preferred
Securities, may use "CUSIP" numbers (if then generally in use), and, if so, the
Property Trustee shall use "CUSIP" numbers in notices of redemption as a
convenience to Holders of Preferred Securities; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Preferred Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Preferred Securities, and any such redemption shall not
be affected by any defect in or omission of such numbers. The Sponsor will
promptly notify the Property Trustee of any change in the CUSIP numbers.
ARTICLE 8
Dissolution and Termination of Trust
Section 8.01. Dissolution and Termination of Trust. (a) The Trust shall
automatically dissolve upon the first to occur of the following events:
(i) the bankruptcy of the Sponsor or the Guarantor;
(ii) (A) the filing of a certificate of dissolution or liquidation or
its equivalent with respect to the Sponsor or the Guarantor or (B) the
revocation of the charter of the Sponsor or the Guarantor and the
expiration of 90 days after the date of revocation without a reinstatement
thereof;
(iii) upon the election of the Sponsor and, after satisfaction of
liabilities to creditors of the Trust, if any, as provided by applicable
law, the distribution of all of the Senior Notes to Holders of Securities;
provided that the Sponsor shall have delivered notice to the Trust, the
Property Trustee and the Delaware Trustee stating its intent to dissolve
the Trust in accordance with the terms of the Securities, and provided
further that such dissolution is conditioned on the Administrative
Trustees' receipt of an opinion of an independent tax counsel experienced
in such matters to the effect that the Holders will not recognize any gain
or loss for United States Federal income tax purposes as a result of the
dissolution of the Trust and the distribution of the Senior Notes;
(iv) the entry of a decree of judicial dissolution of the Trust by a
court of competent jurisdiction;
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(v) the redemption of all of the Securities and the payment to the
Holders thereof of any and all amounts necessary therefor, all in
accordance with the terms of the Securities; or
(vi) the expiration of the term of the Trust provided in Section 3.14.
(b) As soon as is practicable upon completion of winding up of the Trust
following the occurrence of an event referred to in Section 8.01(a), the
Administrative Trustees shall terminate the Trust by filing a certificate of
cancellation with the Secretary of State of the State of Delaware in accordance
with the Business Trust Act.
(c) The provisions of Sections 3.09, 3.10 and 5.13 and Article 10 shall
survive the termination of the Trust.
ARTICLE 9
Transfer of Interests
Section 9.01. Transfer of Securities. (a) Securities may only be
transferred, in whole or in part, in accordance with the terms and conditions
set forth in this Agreement and in the terms of the Securities. To the fullest
extent permitted by law, any transfer or purported transfer, sale or other
disposition of any Security not made in accordance with this Agreement shall be
null and void.
(b) Subject to this Article 9 and to restrictions under applicable federal
and state securities laws, Preferred Securities shall be freely transferable.
(c) To the fullest extent permitted by law, the Sponsor may not transfer
the Common Securities except for (i) any transfer to an Affiliate of the Sponsor
or (ii) any transfer (whether voluntarily or by operation of law) permitted
under Article VIII of the Base Indenture.
(d) Each Preferred Security that bears or is required to bear the legend
set forth in this Section 9.01(d) (a "Restricted Security") shall be subject to
the restrictions on transfer provided in the legend set forth in or contemplated
by this Section 9.01(d), unless such restrictions on transfer shall be waived by
the written consent of the Administrative Trustees, and the Holder of each
Restricted Security, by such Holder's acceptance thereof, agrees to be bound by
such restrictions on transfer. As used in this Section 9.01(d) and in Section
9.01(f), the term "transfer" encompasses any sale, pledge, transfer or other
disposition of any Restricted Security.
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Prior to the Transfer Restriction Termination Date, any certificate
evidencing a Preferred Security shall bear a legend in substantially the
following form, unless otherwise agreed by the Administrative Trustees (with
written notice thereof to the Property Trustee):
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY
NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B)
IT HAS ACQUIRED THE SECURITIES IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT, (2)
AGREES THAT IT WILL NOT PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE
TO SALES OF THE SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES
ACT (OR ANY SUCCESSOR PROVISION) RESELL OR OTHERWISE TRANSFER THE SECURITIES
EVIDENCED HEREBY EXCEPT (A) TO MUTUAL RISK MANAGEMENT LTD. OR ANY AFFILIATE
THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A
UNDER THE SECURITIES ACT OR (C) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT AND (3)
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITIES EVIDENCED
HEREBY ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS
LEGEND WILL BE REMOVED AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO
SALES OF THE SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES
ACT.
Following the Transfer Restriction Termination Date, any Preferred Security
or Securities issued in exchange or substitution therefor (other than Preferred
Securities acquired by the Sponsor or any Affiliate), may upon surrender of such
Preferred Security or Securities for exchange to the Registrar in accordance
with the provisions of Section 9.01(g), be exchanged for a new Preferred
Security or Securities, as the case may be, in a like aggregate Liquidation
Amount that shall not bear the restrictive legend required by this Section.
(e) Any Security that, prior to the Transfer Restriction Termination Date,
is purchased or owned by the Sponsor or any Affiliate thereof may not be
57
resold by the Sponsor or such Affiliate unless registered under the Securities
Act or resold pursuant to an exemption from the registration requirements
thereof that results in such Security no longer being a "restricted security" as
defined under Rule 144 under the Securities Act.
(f) The Preferred Securities may be transferred or exchanged only in
minimum denominations of $100,000 Liquidation Amount and integral multiples of
$1,000 in excess thereof, and any attempted transfer, sale or other disposition
of Preferred Securities in a denomination of less than $100,000 Liquidation
Amount shall be deemed to be void and of no legal effect whatsoever.
(g) The Trust shall provide for the registration of Securities and of the
transfer of Securities, which will be effected without charge but only upon
payment (with such indemnity as the Registrar may require) in respect of any tax
or other governmental charges that may be imposed in relation to it. Upon
surrender for registration of transfer of any Securities, the Administrative
Trustees shall cause one or more new Securities to be issued in the name of the
designated transferee or transferees. Every Security surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Registrar and the Property
Trustee duly executed by the Holder or such Holder's attorney duly authorized in
writing. Each Security surrendered for registration of transfer shall be
canceled by the Property Trustee. A transferee of a Security shall be entitled
to the rights and subject to the obligations of a Holder hereunder upon the
receipt by such transferee of a Security. By acceptance of a Security, each
transferee shall be deemed to have agreed to be bound by this Agreement.
Section 9.02. Transfer Procedures and Restrictions. (a) When Definitive
Preferred Securities are presented to the Registrar:
(x) to register the transfer of such Definitive Preferred Securities;
or
(y) to exchange such Definitive Preferred Securities which became
mutilated, destroyed, defaced, stolen or lost, for an equal Liquidation
Amount of Definitive Preferred Securities,
the Registrar shall register the transfer or make the exchange as requested if
its reasonable requirements for such transaction are met; provided that the
Definitive Preferred Securities surrendered for transfer or exchange shall be
duly endorsed or accompanied by a written instrument of transfer in form
reasonably satisfactory to the Property Trustee and the Registrar, duly executed
by the Holder thereof or his attorney duly authorized in writing and comply with
Section 9.01(d) or 9.01(e), as applicable.
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(b) Transfer of a Definitive Preferred Security for a Beneficial Interest
---------------------------------------------------------------------
in a Global Preferred Security. Upon receipt by the Property Trustee of a
------------------------------
Definitive Preferred Security, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Property Trustee, and in
compliance with restrictions under Section 9.02(c), together with written
instructions directing the Property Trustee to make, or to direct the Depository
to make, an adjustment on its books and records with respect to the Global
Preferred Security to reflect an increase in the Liquidation Amount of the
Preferred Securities represented by such Global Preferred Security, then the
Property Trustee shall cancel such Definitive Preferred Security and cause, or
direct the Depository to cause, the aggregate Liquidation Amount of Preferred
Securities represented by the appropriate Global Preferred Security to be
increased accordingly. If no Global Preferred Securities are then outstanding,
an Administrative Trustee shall execute on behalf of the Trust and shall issue
and the Property Trustee shall authenticate, upon written order of any
Administrative Trustee, a Global Preferred Security representing an appropriate
Liquidation Amount of Preferred Securities.
(c) Transfer and Exchange of Global Preferred Securities. Subject to
----------------------------------------------------
Section 9.01(d) and Section 9.02(d), the transfer and exchange of Global
Preferred Securities or beneficial interests therein shall be effected through
the Depository, in accordance with this Agreement and the procedures of the
Depository therefor.
(d) Transfer of a Beneficial Interest in a Global Preferred Security for a
----------------------------------------------------------------------
Definitive Preferred Security.
-----------------------------
(i) A Global Preferred Security deposited with the Depository or with
the Property Trustee as custodian for the Depository pursuant to Section
7.03 shall be transferred to the beneficial owners thereof in the form of
Definitive Preferred Securities only if such transfer complies with
Sections 9.01(d), 9.02(c) and 9.02(e) and (A) the Depository notifies the
Trust that it is unwilling or unable to continue as Depository for such
Global Preferred Security or if at any time such Depository ceases to be a
"clearing agency" registered under the Exchange Act and, in each case, a
depository is not appointed by the Sponsor within 90 days of receipt of
such notice or of becoming aware of such condition, (B) an Event of Default
has occurred and is continuing or (C) the Administrative Trustees, on
behalf of the Trust, at their sole discretion elect to cause the issuance
of Definitive Preferred Securities.
(ii) Any Global Preferred Security that is transferable to the
beneficial owners thereof in the form of Definitive Preferred Securities
pursuant to this Section 9.02(d) shall be surrendered by the Depository to
the Property Trustee to be so transferred, in whole or from time to time in
part, without charge, and the Property Trustee shall authenticate and make
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available for delivery, upon such transfer of each portion of such Global
Preferred Security, an equal aggregate Liquidation Amount of Securities of
authorized denominations in the form of Definitive Preferred Securities.
Any portion of a Global Preferred Security transferred pursuant to this
Section shall be registered in such names as the Depository shall direct.
(iii) If any of the events specified in Section 9.02(d)(i) above
occurs, the Administrative Trustees will promptly make available to the
Property Trustee a reasonable supply of Definitive Preferred Securities in
fully registered form without Distribution coupons.
(e) Restrictions on Transfer and Exchange of Global Preferred Securities.
--------------------------------------------------------------------
Notwithstanding any other provisions of this Agreement (other than the
provisions set forth in Section 9.01(d) and 9.02(d)), a Global Preferred
Security may not be transferred as a whole except by the Depository to a nominee
of the Depository or another nominee of the Depository or by the Depository or
any such nominee to a successor Depository or a nominee of such successor
Depository.
(f) Cancellation or Adjustment of Global Preferred Security. At such time
-------------------------------------------------------
as all beneficial interests in a Global Preferred Security have either been
exchanged for Definitive Preferred Securities to the extent permitted by this
Agreement or redeemed, repurchased or canceled in accordance with the terms of
this Agreement, such Global Preferred Security shall be returned to the
Depository for cancellation or retained and canceled by the Property Trustee. At
any time prior to such cancellation, if any beneficial interest in a Global
Preferred Security is exchanged for Definitive Preferred Securities, Preferred
Securities represented by such Global Preferred Security shall be reduced and an
adjustment shall be made on the books and records of the Property Trustee (if it
is then the custodian for such Global Preferred Security) with respect to such
Global Preferred Security, by the Property Trustee, to reflect such reduction.
(g) Obligations with Respect to Transfers and Exchanges of Preferred
----------------------------------------------------------------
Securities.
----------
(i) To permit registrations of transfers and exchanges, an
Administrative Trustee shall execute and the Property Trustee shall
authenticate Definitive Preferred Securities and Global Preferred
Securities at the Registrar's request in accordance with the terms of this
Agreement.
(ii) Registrations of transfers or exchanges will be effected without
charge, but only upon payment (with such indemnity as the Trust,
60
the Registrar or the Sponsor may require) in respect of any tax or other
governmental charge that may be imposed in relation to it.
(iii) The Registrar shall not be required to register the transfer of
or exchange of (A) Preferred Securities during a period beginning at the
opening of business 15 days before the day of mailing of a notice of
redemption or any notice of selection of Preferred Securities for
redemption and ending at the close of business on the day of such mailing;
or (B) any Preferred Security so selected for redemption in whole or in
part, except the unredeemed portion of any Preferred Security being
redeemed in part.
(iv) All Preferred Securities issued upon any registration of
transfer or exchange pursuant to the terms of this Agreement shall evidence
the same security and shall be entitled to the same benefits under this
Agreement as the Preferred Securities surrendered upon such registration of
transfer or exchange.
(h) No Obligation of the Property Trustee.
-------------------------------------
(i) The Property Trustee shall have no responsibility or obligation
to any beneficial owner of a Global Preferred Security, a Participant in
the Depository or other Person with respect to the accuracy of the records
of the Depository or its nominee or of any Participant thereof, with
respect to any ownership interest in the Preferred Securities or with
respect to the delivery to any Participant, beneficial owner or other
Person (other than the Depository) of any notice (including any notice of
redemption) or the payment of any amount, under or with respect to such
Preferred Securities. All notices and communications to be given to the
Holders and all payments to be made to Holders under the Preferred
Securities shall be given or made only to or upon the order of the Holders
(which shall be the Depository or its nominee in the case of a Global
Preferred Security). The rights of beneficial owners in any Global
Preferred Security shall be exercised only through the Depository subject
to the applicable rules and procedures of the Depository. The Property
Trustee may conclusively rely and shall be fully protected in relying upon
information furnished by the Depository or any agent thereof with respect
to its Participants and any beneficial owners.
(ii) The Property Trustee and Registrar shall have no obligation or
duty to monitor, determine or inquire as to compliance with any
restrictions on transfer imposed under this Agreement or under applicable
law with respect to any transfer of any interest in any Preferred Security
(including any transfers between or among Participants or beneficial
61
owners in any Global Preferred Security) other than to require delivery of
such certificates and other documentation or evidence as are expressly
required by, and to do so if and when expressly required by, the terms of
this Agreement, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
Section 9.03. Deemed Security Holders. The Trust, the Trustees, the
Registrar and the Paying Agent may treat the Person in whose name any Security
shall be registered on the books and records of the Trust as the sole owner and
Holder of such Security for purposes of receiving Distributions and for all
other purposes whatsoever and, accordingly, shall not be bound to recognize any
equitable or other claim to or interest in such Security on the part of any
Person other than such Holder, regardless of any notice to the contrary.
Section 9.04. Book-Entry Interests. (a) Unless and until Definitive
Preferred Securities have been issued to the Preferred Security Beneficial
Owners pursuant to Section 9.02:
(i) the provisions of this Section 9.04 shall be in full force and
effect;
(ii) the Trust and the Trustees shall be entitled to deal with the
Depository for all purposes of this Agreement (including the payment of
Distributions on the Global Preferred Securities and receiving approvals,
votes or consents hereunder) as the Holder of the Preferred Securities and
the sole Holder of the Global Preferred Securities and shall have no
obligation to the Preferred Security Beneficial Owners;
(iii) to the extent that the provisions of this Section 9.04 conflict
with any other provisions of this Agreement, the provisions of this Section
9.04 shall control; and
(iv) the rights of the Preferred Security Beneficial Owners shall be
exercised only through the Depository and shall be limited to those
established by law and agreements between such Preferred Security
Beneficial Owners and the Depository and/or the Participants, including
receiving and transmitting payments of Distributions on the Global
Certificates to such Participants. The Depository will make book entry
transfers among the Participants.
(b) Any Global Preferred Security may be endorsed with or have
incorporated in the text thereof such legends or recitals or changes not
inconsistent with the provisions of this Agreement as may be required by the
Depository, by any exchange or by the National Association of Securities
Dealers,
62
Inc. in order for the Preferred Securities to be tradeable on the PORTAL Market
or as may be required for the Preferred Securities to be tradeable on any other
market developed for trading of securities pursuant to Rule 144A or required to
comply with any applicable law or any regulation thereunder or with the rules
and regulations of any securities exchange upon which the Preferred Securities
may be listed or traded or to conform with any usage with respect thereto, or to
indicate any special limitations or restrictions to which any particular
Preferred Securities are subject.
Section 9.05. Notices to Depository. Whenever a notice or other
communication to the Holders of Preferred Securities is required to be given by
a Trustee under this Agreement, such Trustee shall give all such notices and
communications specified herein to be given to the Holders of Global Preferred
Securities to the Depository and shall have no notice obligations to the
Preferred Security Beneficial Owners.
Section 9.06. Appointment of Successor Depository. If any Depository elects
to discontinue its services as securities depository with respect to the
Preferred Securities, the Administrative Trustees may, in their sole discretion,
appoint a successor Depository with respect to the Preferred Securities.
ARTICLE 10
Limitation of Liability of Holders of Securities, Trustees or Others
Section 10.01. Liability.
(a) Except as expressly set forth in this Agreement, the Securities
Guarantees and the terms of the Securities, the Sponsor shall neither be:
(i) personally liable for the return of any portion of the capital
contributions (or any return thereon) of the Holders of the Securities
which shall be made solely from assets of the Trust; nor
(ii) required to pay to the Trust or to any Holder of Securities any
deficit upon dissolution of the Trust or otherwise.
(b) The Sponsor shall be liable for all of the debts and obligations of the
Trust (other than with respect to the Securities) to the extent not satisfied
out of the Trust's assets.
(c) Pursuant to (S) 3803(a) of the Business Trust Act, the Holders of the
Preferred Securities shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.
63
Section 10.02. Exculpation. (a) No Indemnified Person shall be liable,
responsible or accountable in damages or otherwise to the Trust or any Covered
Person for any loss, damage or claim incurred by reason of any act or omission
performed or omitted by such Indemnified Person in good faith on behalf of the
Trust and in a manner such Indemnified Person reasonably believed to be within
the scope of the authority conferred on such Indemnified Person by this
Agreement or by law, except that this provision will not be deemed to modify
Section 3.09 and an Indemnified Person shall be liable for any such loss, damage
or claim incurred by reason of such Indemnified Person's gross negligence or
willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good faith
upon the records of the Trust and upon such information, opinions, reports or
statements presented to the Trust by any Person as to matters the Indemnified
Person reasonably believes are within such other Person's professional or expert
competence and who, if selected by such Indemnified Person, has been selected by
it with reasonable care on behalf of the Trust, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits, losses, or any other facts pertinent to the existence and amount of
assets from which Distributions to Holders of Securities might properly be paid.
Section 10.03. Fiduciary Duty. (a) To the extent that, at law or in equity,
an Indemnified Person has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this Agreement shall not be liable to the Trust or to any
other Covered Person for its good faith reliance on the provisions of this
Agreement. The provisions of this Agreement, to the extent that they restrict
the duties and liabilities of an Indemnified Person otherwise existing at law or
in equity (other than the duties imposed on the Property Trustee under the Trust
Indenture Act), are agreed by the parties hereto to replace such other duties
and liabilities of such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between any
Covered Person and any Indemnified Person; or
(ii) whenever this Agreement or any other agreement contemplated
herein provides that an Indemnified Person shall act in a manner that is,
or provides terms that are, fair and reasonable to the Trust or any Holder
of Securities,
64
the Indemnified Person shall resolve such conflict of interest, take such
action or provide such terms, considering in each case the relative interest of
each party (including its own interest) to such conflict, agreement, transaction
or situation and the benefits and burdens relating to such interests, any
customary or accepted industry practices, and any applicable generally accepted
accounting practices or principles. In the absence of bad faith by the
Indemnified Person, the resolution, action or term so made, taken or provided by
the Indemnified Person shall not constitute a breach of this Agreement or any
other agreement contemplated herein or of any duty or obligation of the
Indemnified Person at law or in equity or otherwise.
(c) Whenever in this Agreement an Indemnified Person is permitted or
required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such interests and factors
as it desires, including its own interests, and shall have no duty or
obligation to give any consideration to any interest of or factors
affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Agreement or by
applicable law.
Section 10.04. Indemnification.
(a) (i) The Sponsor shall indemnify, to the full extent permitted by
law, any Company Indemnified Person who was or is a party or is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the Trust) by reason of the fact that
he is or was a Company Indemnified Person against expenses (including
attorneys' fees and expenses), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Trust, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of
any action, suit or proceeding by judgment, order, settlement, conviction,
or upon a plea of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the Company Indemnified Person did not act in
good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of the Trust, and, with
65
respect to any criminal action or proceeding, had reasonable cause to
believe that his conduct was unlawful.
(ii) The Sponsor shall indemnify, to the full extent permitted by
law, any Company Indemnified Person who was or is a party or is threatened
to be made a party to any threatened, pending or completed action or suit
by or in the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified Person against
expenses (including attorneys' fees and expenses) actually and reasonably
incurred by him in connection with the defense or settlement of such action
or suit if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Trust and except that no
such indemnification shall be made in respect of any claim, issue or matter
as to which such Company Indemnified Person shall have been adjudged to be
liable to the Trust unless and only to the extent that the Court of
Chancery of Delaware or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such Company
Indemnified Person is fairly and reasonably entitled to indemnity for such
expenses which such Court of Chancery or such other court shall deem
proper.
(iii) To the extent that a Company Indemnified Person shall be
successful on the merits or otherwise (including dismissal of an action
without prejudice or the settlement of an action without admission of
liability) in defense of any action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 10.04(a), or in defense of any
claim, issue or matter therein, he shall be indemnified, to the full extent
permitted by law, against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith.
(iv) Any indemnification under paragraphs (i) and (ii) of this
Section 10.04(a) (unless ordered by a court) shall be made by the Sponsor
only as authorized in the specific case upon a determination that
indemnification of the Company Indemnified Person is proper in the
circumstances because he has met the applicable standard of conduct set
forth in paragraphs (i) and (ii). Such determination shall be made (1) by
the Administrative Trustees by a majority vote of a Quorum consisting of
such Administrative Trustees who were not parties to such action, suit or
proceeding, (2) if such a Quorum is not obtainable, or, even if obtainable,
if a Quorum of disinterested Administrative Trustees so directs, by
independent legal counsel in a written opinion, or (3) by the Common
Security Holder of the Trust.
66
(v) Expenses (including attorneys' fees and expenses) incurred
by a Company Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding referred to
in Sections 10.04(a)(i) and 10.04(a)(ii) shall be paid by the Sponsor
in advance of the final disposition of such action, suit or proceeding
upon receipt of an undertaking by or on behalf of such Company
Indemnified Person to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the Sponsor as
authorized in this Section 10.04(a). Notwithstanding the foregoing, no
advance shall be made by the Sponsor if a determination is reasonably
and promptly made (A) by the Administrative Trustees by a majority vote
of a Quorum of disinterested Administrative Trustees, (B) if such a
Quorum is not obtainable, or, even if obtainable, if a quorum of
disinterested Administrative Trustees so directs, by independent legal
counsel in a written opinion or (C) by the Common Security Holder of
the Trust, that, based upon the facts known to the Administrative
Trustees, counsel or the Common Security Holder at the time such
determination is made, such Company Indemnified Person acted in bad
faith or in a manner that such Person did not believe to be in or not
opposed to the best interests of the Trust, or, with respect to any
criminal proceeding, that such Company Indemnified Person believed or
had reasonable cause to believe his conduct was unlawful. In no event
shall any advance be made in instances where the Administrative
Trustees, independent legal counsel or Common Security Holder
reasonably determine that such person deliberately breached his duty to
the Trust or its Common or Preferred Security Holders.
(vi) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other paragraphs of this Section
10.04(a) shall not be deemed exclusive of any other rights to which
those seeking indemnification and advancement of expenses may be
entitled under any agreement, vote of stockholders or disinterested
directors of the Sponsor or Preferred Security Holders of the Trust or
otherwise, both as to action in his official capacity and as to action
in another capacity while holding such office. All rights to
indemnification under this Section 10.04(a) shall be deemed to be
provided by a contract between the Sponsor and each Company Indemnified
Person who serves in such capacity at any time while this Section
10.04(a) is in effect. Any modification of this Section 10.04(a) shall
not affect any rights or obligations then existing.
(vii) The Sponsor or the Trust may purchase and maintain
insurance on behalf of any Person who is or was a Company Indemnified
Person against any liability asserted against him and incurred by him
in any such capacity, or arising out of his status as such, whether or
not the
67
Sponsor would have the power to indemnify him against such liability
under the provisions of this Section 10.04(a).
(viii) For purposes of this Section 10.04(a), references to "the
Trust" shall include, in addition to the resulting or surviving entity,
any constituent entity (including any constituent of a constituent)
absorbed in a consolidation or merger, so that any person who is or was
a director, trustee, officer or employee of such constituent entity, or
is or was serving at the request of such constituent entity as a
director, trustee, officer, employee or agent of another entity, shall
stand in the same position under the provisions of this Section
10.04(a) with respect to the resulting or surviving entity as he would
have with respect to such constituent entity if its separate existence
had continued.
(ix) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Section 10.04(a) shall, unless
otherwise provided when authorized or ratified, continue as to a Person
who has ceased to be a Company Indemnified Person and shall inure to
the benefit of the heirs, executors and administrators of such a
person.
(b) The Sponsor agrees to indemnify the (i) Property Trustee, (ii) the
Delaware Trustee, (iii) any Affiliate of the Property Trustee and the Delaware
Trustee, and (iv) any officers, directors, shareholders, members, partners,
employees, representatives, custodians, nominees or agents of the Property
Trustee and the Delaware Trustee (each of the Persons in (i) through (iv) being
referred to as a "Fiduciary Indemnified Person") for, and to hold each Fiduciary
Indemnified Person harmless against, any and all loss, liability, damage, claim
or expense incurred without negligence, bad faith or willful misconduct on its
part (or such other standard otherwise provided, in the case of the Property
Trustee, in the Trust Indenture Act), arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of defending
itself against or investigating any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. With respect
to the Property Trustee, this provision shall not be deemed to modify Section
3.09(b) of this Agreement. The obligation to indemnify as set forth in this
Section 10.04(b) shall survive the resignation or removal of the Property
Trustee or the Delaware Trustee and the satisfaction and discharge of this
Agreement.
Section 10.05. Outside Businesses. Any Covered Person, the Sponsor, the
Delaware Trustee and the Property Trustee subject to Section 5.03 may engage in
or possess an interest in other business ventures of any nature or description,
independently or with others, similar or dissimilar to the business of the
Trust, and the Trust and the Holders of Securities shall have no rights by
virtue of this
68
Agreement in and to such independent ventures or the income or profits derived
therefrom, and the pursuit of any such venture, even if competitive with the
business of the Trust, shall not be deemed wrongful or improper. No Covered
Person, the Sponsor, the Delaware Trustee, or the Property Trustee shall be
obligated to present any particular investment or other opportunity to the Trust
even if such opportunity is of a character that, if presented to the Trust,
could be taken by the Trust, and any Covered Person, the Sponsor, the Delaware
Trustee and the Property Trustee shall have the right to take for its own
account (individually or as a partner or fiduciary) or to recommend to others
any such particular investment or other opportunity. Any Covered Person, the
Delaware Trustee and the Property Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the Sponsor,
or may act as depository for, trustee or agent for, or act on any committee or
body of holders of, securities or other obligations of the Sponsor or its
Affiliates.
ARTICLE 11
ACCOUNTING
Section 11.01. Fiscal Year. The fiscal year ("Fiscal Year") of the
Trust shall be the calendar year, or such other year as is required by the Code.
Section 11.02. Certain Accounting Matters. (a) At all times during the
existence of the Trust, the Administrative Trustees shall keep, or cause to be
kept, full books of account, records and supporting documents, which shall
reflect in reasonable detail, each transaction of the Trust. The books of
account shall be maintained on the accrual method of accounting, in accordance
with generally accepted accounting principles, consistently applied. The books
of account and the records of the Trust shall be examined by and reported upon
as of the end of each Fiscal Year of the Trust by a firm of independent
certified public accountants selected by the Administrative Trustees.
(b) The Administrative Trustees shall cause to be duly prepared and
delivered to each of the Holders of Securities, any annual United States Federal
income tax information statement, required by the Code, containing such
information with regard to the Securities held by each Holder as is required by
the Code and the Treasury Regulations. Notwithstanding any right under the Code
to deliver any such statement at a later date, the Administrative Trustees shall
endeavor to deliver all such information statements within 60 days after the end
of each Fiscal Year of the Trust.
(c) The Administrative Trustees shall cause to be duly prepared and
filed with the appropriate taxing authority, an annual United States Federal
income tax
69
return, as a grantor trust, on a Form 1041 or such other form required by United
States Federal income tax law, and any other annual income tax returns required
to be filed by the Administrative Trustees on behalf of the Trust with any state
or local taxing authority.
Section 11.03. Banking. The Trust shall maintain one or more bank
accounts in the name and for the sole benefit of the Trust; provided that all
payments of funds in respect of the Senior Notes held by the Property Trustee
shall be made directly to the Property Trustee Account and no other funds of the
Trust shall be deposited in the Property Trustee Account. The sole signatories
for such accounts shall be designated by the Administrative Trustees; provided
that the Property Trustee shall designate the signatories for the Property
Trustee Account.
Section 11.04. Withholding. The Trust and the Administrative Trustees
shall comply with all withholding requirements under United States Federal,
state and local law. The Administrative Trustees, on behalf of the Trust, shall
request, and the Holders shall provide to the Trust, such forms or certificates
as are necessary to establish an exemption from withholding with respect to each
Holder, and any representations and forms as shall reasonably be requested by
the Administrative Trustees to assist them in determining the extent of, and in
fulfilling, the Trust's withholding obligations. The Administrative Trustees
shall file required forms with applicable jurisdictions and, unless an exemption
from withholding is properly established by a Holder, shall remit amounts
withheld with respect to the Holder to applicable jurisdictions. To the extent
that the Trust is required to withhold and pay over any amounts to any authority
with respect to Distributions or allocations to any Holder, the amount withheld
shall be deemed to be a Distribution in the amount of the withholding to the
Holder. In the event of any claim of excess withholding, Holders shall be
limited to an action against the applicable jurisdiction. If the amount required
to be withheld was not withheld from actual Distributions made, the Trust may
reduce subsequent Distributions by the amount of such withholding.
ARTICLE 12
AMENDMENTS AND MEETINGS
Section 12.01. Amendments. (a) Except as otherwise provided in this
Agreement or by any applicable terms of the Securities, this Agreement may only
be amended by a written instrument approved and executed by:
70
(i) the Sponsor and the Administrative Trustees (or, if there are
more than two Administrative Trustees, a majority of the Administrative
Trustees);
(ii) if the amendment affects the rights, powers, duties, obligations
or immunities of the Property Trustee, the Property Trustee; and
(iii) if the amendment affects the rights, powers, duties, obligations
or immunities of the Delaware Trustee, the Delaware Trustee.
(b) No amendment shall be made, and any such purported amendment shall be
void and ineffective:
(i) unless, in the case of any proposed amendment, the Property
Trustee shall have first received an Officers' Certificate from each of the
Trust and the Sponsor that such amendment is permitted by, and conforms to, the
terms of this Agreement (including the terms of the Securities);
(ii) unless, in the case of any proposed amendment which affects the
rights, powers, duties, obligations or immunities of the Property Trustee, the
Property Trustee shall have first received:
(A) an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to, the terms
of this Agreement (including the terms of the Securities); and
(B) an opinion of counsel (who may be counsel to the Sponsor or
the Trust) that such amendment is permitted by, and conforms to, the
terms of this Agreement (including the terms of the Securities) and
that all conditions precedent to the execution and delivery of such
amendment have been satisfied; and
(iii) to the extent the result of such amendment would:
(A) cause the Trust to fail to be classified for purposes of
United States Federal income taxation as a grantor trust;
(B) reduce or otherwise adversely affect the powers of the
Property Trustee in contravention of the Trust Indenture Act; or
(C) cause the Trust to be deemed to be an Investment Company
required to be registered under the Investment Company Act.
71
(c) At such time after the Trust has issued any Securities that
remain outstanding, any amendment that would adversely affect the rights,
privileges or preferences of any Holder of the Securities may be effected only
with such additional requirements as may be set forth in the terms of such
Securities; provided that, without the consent of each Holder of the Securities,
this Agreement may not be amended to (i) change the Distribution Rate (or manner
of calculation of the Distribution Rate), amount, timing or currency or
otherwise adversely affect the method of any required payment, (ii) change the
purposes of the Trust, (iii) authorize the issuance of any additional beneficial
interests in the Trust, (iv) change the redemption provisions, (v) change the
conditions precedent for the Sponsor to elect to dissolve the Trust and, after
satisfaction of liabilities to the creditors of the Trust, if any, as provided
by applicable law, distribute the Senior Notes to the Holders of the Securities,
(vi) change the Liquidation Distribution or other provisions relating to the
distribution of amounts payable upon the dissolution and liquidation of the
Trust, (vii) affect the limited liability of any Holder of the Securities or
(viii) restrict the right of a Holder of the Securities to institute suit for
the enforcement of any required payment on or after the due date therefor (or,
in the case of a redemption, on the redemption date).
(d) Article 6, Section 9.01(c) and this Section 12.01 shall not be
amended without the consent of all of the Holders of the Securities.
(e) Article 4 shall not be amended without the consent of the Holders
of a Majority in Liquidation Amount of the Common Securities.
(f) The rights of the Holders of the Common Securities under Article 5
to increase or decrease the number of, and to appoint and remove, Trustees shall
not be amended without the consent of the Holders of a Majority in Liquidation
Amount of the Common Securities.
(g) Notwithstanding Section 12.01(c), this Agreement may be amended by
the Sponsor and the Trustees without the consent of the Holders of the
Securities to:
(i) cure any ambiguity, correct or supplement any provision in this
Agreement that may be inconsistent with any other provision of this
Agreement or to make any other provisions with respect to matters or
questions arising under this Agreement not inconsistent with any other
provisions of this Agreement; and
(ii) modify, eliminate or add to any provisions of this Agreement to
such extent as shall be necessary to ensure that the Trust will be
classified for United States Federal income tax purposes as a grantor
trust at all times that any Securities are outstanding or to ensure
that the Trust will not be required to register as an Investment
Company under the Investment Company Act;
72
provided, however, that, in each case, such action shall not adversely affect in
any material respect the interests of the Holders of the Securities, and any
such amendments of this Agreement shall become effective when notice thereof is
given to the Holders of the Securities.
Section 12.02. Meetings of the Holders of Securities; Action by Written
Consent. (a) Meetings of the Holders of any class of Securities may be called at
any time by the Administrative Trustees (or as provided in the terms of the
Securities) to consider and act on any matter on which Holders of such class of
Securities are entitled to act under the terms of this Agreement, the terms of
the Securities or the rules of any stock exchange or quotation system or market
on which the Preferred Securities are listed or admitted for trading. The
Administrative Trustees shall call a meeting of the Holders of such class if
directed to do so by the Holders of at least 10% in Liquidation Amount of the
Securities of such class. Such direction shall be given by delivering to the
Administrative Trustees one or more notices in a writing stating that the
signing Holders of Securities wish to call a meeting and indicating the general
or specific purpose for which the meeting is to be called. Any Holders of
Securities calling a meeting shall specify in writing the certificates held by
the Holders of Securities exercising the right to call a meeting and only those
Securities specified shall be counted for purposes of determining whether the
required percentage set forth in the second sentence of this paragraph has been
met.
(b) Whenever a vote, consent or approval of the Holders of Securities
is permitted or required under this Agreement or the rules of any stock exchange
or quotation system or market on which the Preferred Securities are listed or
admitted for trading, such vote, consent or approval may be given at a meeting
of the Holders of Securities. Any action that may be taken at a meeting of the
Holders of Securities may be taken without a meeting and without prior notice if
consent in writing setting forth the action so taken is signed by the Holders of
Securities owning not less than the minimum amount of Securities in Liquidation
Amount that would be necessary to authorize or take such action at a meeting at
which all Holders of Securities having a right to vote thereon were present and
voting. Prompt notice of the taking of action without a meeting shall be given
to the Holders of Securities entitled to vote who have not consented in writing.
(c) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:
73
(i) notice of any such meeting shall be given to all the Holders of
Securities having a right to vote thereat at least seven days and not more
than 60 days before the date of such meeting. The Administrative Trustees
may specify that any written ballot submitted to the Holders of Securities
for the purpose of taking any action without a meeting shall be returned to
the Trust within the time specified by the Administrative Trustees;
(ii) each Holder of a Security may authorize any Person to act for it
by proxy on all matters in which a Holder of Securities is entitled to
participate, including waiving notice of any meeting, or voting or
participating at a meeting. No proxy shall be valid after the expiration of
eleven months from the date thereof unless otherwise provided in the proxy.
Every proxy shall be revocable at the pleasure of the Holder of Securities
executing it. Except as otherwise provided herein, all matters relating to
the giving, voting or validity of proxies shall be governed by the General
Corporation Law of the State of Delaware relating to proxies, and judicial
interpretations thereunder, as if the Trust were a Delaware corporation and
the Holders of the Securities were stockholders of a Delaware corporation;
(iii) each meeting of the Holders of the Securities shall be conducted
by the Administrative Trustees or by such other Person that the Administrative
Trustees may designate; and
(iv) unless the Business Trust Act, this Agreement, the terms of the
Securities, the Trust Indenture Act or the listing rules of any stock exchange
or quotation system or market on which the Preferred Securities are then listed
or trading otherwise provides, the Administrative Trustees, in their sole
discretion, shall establish all other provisions relating to meetings of Holders
of Securities, including notice of the time, place or purpose of any meeting at
which any matter is to be voted on by any Holders of Securities, waiver of any
such notice, action by consent without a meeting, the establishment of a record
date, quorum requirements, voting in person or by proxy or any other matter with
respect to the exercise of any such right to vote.
Section 12.03. Power of Attorney. Each Holder by acceptance of the
Preferred Securities hereby irrevocably constitutes and appoints the Remarketing
Agent and each of its officers as such person's true and lawful representative
and attorney-in-fact, with full power and authority in such person's name, place
and stead to make, execute, acknowledge, deliver, swear to, record and file with
respect to the Preferred Securities any and all instruments, documents and
certificates which, from time to time, may be required in connection with the
Remarketing and to take any other action which the Remarketing Agent may
74
deem necessary or appropriate, in its discretion, in connection with Remarketing
the Preferred Securities. This power of attorney is coupled with an interest and
shall continue in full force and effect and shall not be affected by the
subsequent death, disability, insolvency, bankruptcy, dissolution, termination
or incapacity of a Holder and may be exercised by an officer of the Remarketing
Agent signing individually for any Holder or for all Holders executing any
particular instrument.
ARTICLE 13
REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE
Section 13.01. Representations and Warranties of Property Trustee. The
Trustee that acts as initial Property Trustee represents and warrants to the
Trust and to the Sponsor at the date of this Agreement, and each Successor
Property Trustee represents and warrants, as applicable, to the Trust and the
Sponsor at the time of the Successor Property Trustee's acceptance of its
appointment as Property Trustee that:
(a) the Property Trustee is a banking corporation, a national banking
association or a bank or trust company, duly organized, validly existing and in
good standing under the laws of the United States or a State of the United
States, as the case may be, with corporate power and authority to execute and
deliver, and to carry out and perform its obligations under the terms of, this
Agreement;
(b) the execution, delivery and performance by the Property Trustee of
this Agreement have been duly authorized by all necessary corporate action on
the part of the Property Trustee. This Agreement has been duly executed and
delivered by the Property Trustee and constitutes a legal, valid and binding
obligation of the Property Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law);
(c) the execution, delivery and performance of this Agreement by the
Property Trustee do not conflict with or constitute a breach of the charter or
by- laws of the Property Trustee;
(d) the Property Trustee satisfies the requirements set forth in
Section 5.03(a); and
(e) no consent, approval or authorization of, or registration with or
notice to, any federal or State banking authority governing the trust powers of
the
75
Property Trustee is required for the execution, delivery or performance by the
Property Trustee of this Agreement.
Section 13.02. Representations and Warranties of Delaware Trustee. The
Trustee that acts as initial Delaware Trustee represents and warrants to the
Trust and to the Sponsor at the date of this Agreement, and each Successor
Delaware Trustee represents and warrants to the Trust and the Sponsor at the
time of the Successor Delaware Trustee's acceptance of its appointment as
Delaware Trustee that:
(a) if not a natural person, the Delaware Trustee is a corporation, a
national banking association or a bank or trust company, duly organized, validly
existing and in good standing under the laws of the United States or the State
of Delaware, as the case may be, with corporate power and authority to execute
and deliver, and to carry out and perform its obligations under the terms of,
this Agreement;
(b) if not a natural person, the execution, delivery and performance by
the Delaware Trustee of this Agreement have been duly authorized by all
necessary corporate action on the part of the Delaware Trustee. This Agreement
has been duly executed and delivered by the Delaware Trustee under Delaware law
and constitutes a legal, valid and binding obligation of the Delaware Trustee,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, reorganization, moratorium, insolvency, and other similar laws
affecting creditors' rights generally and to general principles of equity and
the discretion of the court (regardless of whether the enforcement of such
remedies is considered in a proceeding in equity or at law);
(c) if not a natural person, the execution, delivery and performance of
this Agreement by the Delaware Trustee do not conflict with or constitute a
breach of the charter or by-laws of the Delaware Trustee;
(d) if not a natural person, no consent, approval or authorization of,
or registration with or notice to, any Federal or Delaware banking authority
governing the trust powers of the Delaware Trustee is required for the
execution, delivery or performance by the Delaware Trustee of this Agreement
(other than the filing of the Certificate of Trust with the Office of the
Secretary of State of the State of Delaware); and
(e) the Delaware Trustee is a natural person who is a resident of the
State of Delaware or, if not a natural person, an entity which has its principal
place of business in the State of Delaware, and is a Person that satisfies for
the Trust Section 3807(a) of the Business Trust Act.
76
ARTICLE 14
MISCELLANEOUS
Section 14.01. Notices. All notices provided for in this Agreement
shall be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by first class mail, as follows:
(a) if given to the Trust, in care of the Administrative Trustees at
the Trust's mailing address set forth below (or such other address as the Trust
may give notice of to the Holders of the Securities):
c/o Mutual Group Ltd.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
(b) if given to the Delaware Trustee, at the mailing address set forth
below (or such other address as Delaware Trustee may give notice of to the
Holders of the Securities):
Chase Manhattan Bank USA, National Association
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇/▇▇/ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Capital Markets Fiduciary Services
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
(c) if given to the Property Trustee, at the Property Trustee's mailing
address set forth below (or such other address as the Property Trustee may give
notice of to the Holders of the Securities):
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇/▇▇/ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Capital Markets Fiduciary Services
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇/8162
77
(d) if given to the Sponsor or the Holder of the Common Securities, at
the mailing address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice to the Trust):
Mutual Group Ltd.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
(e) if given to any other Holder, at the address set forth on the books
and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
Section 14.02. Governing Law. This Agreement and the rights of the
parties hereunder shall be governed by and construed in accordance with the laws
of the State of Delaware and all rights and remedies shall be governed by such
laws without regard to principles of conflict of laws; provided, however, that
the immunities and standard of care of the Property Trustee in connection with
the administration of its trusts and duties hereunder shall be construed in
accordance with and governed by the internal laws of the State of New York.
SECTION 3540 OF TITLE 12 OF THE DELAWARE CODE SHALL NOT APPLY TO THE TRUST.
Section 14.03. Intention of the Parties. It is the intention of the
parties hereto that the Trust be classified for United States Federal income tax
purposes as a grantor trust. The provisions of this Agreement shall be
interpreted to further this intention of the parties.
Section 14.04. Headings. The Table of Contents and headings contained
in this Agreement are inserted for convenience of reference only and do not
affect the interpretation of this Agreement or any provision hereof.
Section 14.05. Successors and Assigns. Whenever in this Agreement any
of the parties hereto is named or referred to, the successors and assigns of
such party shall be deemed to be included, and all covenants and agreements in
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this Agreement by the Sponsor and the Trustees shall bind and inure to the
benefit of their respective successors and assigns, whether so expressed.
Section 14.06. Partial Enforceability. If any provision of this
Agreement, or the application of such provision to any Person or circumstance,
shall be held invalid, the remainder of this Agreement, or the application of
such provision to Persons or circumstances other than those to which it is held
invalid, shall not be affected thereby.
Section 14.07. Counterparts. This Agreement may contain more than one
counterpart of the signature page and this Agreement may be executed by the
affixing of the signature of the Sponsor or each of the Trustees to one of such
counterpart signature pages. All of such counterpart signature pages shall be
read as though one, and they shall have the same force and effect as though all
of the signers had signed a single signature page.
Section 14.08. Jurisdiction and Service of Process. Each of the parties
hereto hereby consents to (i) the non-exclusive jurisdiction of the courts of
the State of Delaware and any Federal court sitting in Wilmington, Delaware, and
(ii) service of process by certified mail to the address set forth in Section
14.01 hereof. The foregoing shall not preclude any party from bringing an action
in any other jurisdiction or from serving process by any other legal means.
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IN WITNESS WHEREOF, the undersigned have caused this Amended and
Restated Trust Agreement to be executed as of the day and year first above
written.
▇▇▇▇▇▇▇ ▇'▇▇▇▇▇, not in his
individual capacity but solely as
Administrative Trustee of the Trust
/s/ ▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
--------------------------------------
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, not in her individual
capacity but solely as Administrative
Trustee of the Trust
/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------
CHASE MANHATTAN BANK
USA, National Association, not in its
individual capacity but solely as
Delaware Trustee of the Trust
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Vice President
THE CHASE MANHATTAN
BANK, not in its individual capacity
but solely as Property Trustee of
the Trust
By: /s/ Sheik Wiltshire
----------------------------------
Title: Second Vice President
80
MUTUAL GROUP LTD., as
Sponsor
By: __________________________________
Name:
Title:
81
Calculation Agent two London Banking Days prior to the Closing Date and shall
equal LIBOR plus 150 basis points. The Distribution Rate in effect thereafter,
for each quarterly period from and including the immediately preceding Pre-
Remarketing Distribution Date to but excluding the applicable Pre-Remarketing
Distribution Date, shall be determined by the Calculation Agent two London
Banking Days prior to such immediately preceding Pre-Remarketing Distribution
Date (a "Date of Determination") and shall equal LIBOR plus 150 basis points.
Prior to the Remarketing Settlement Date, the amount of Distributions payable
for any period shall be computed on the basis of a 360-day year and the actual
number of days elapsed in such period. If a Pre-Remarketing Distribution Date is
not a Business Day, then such Pre-Remarketing Distribution Date will be the next
succeeding Business Day, except if such Business Day is in the next succeeding
calendar month, such Pre-Remarketing Distribution Date will be the immediately
preceding Business Day.
All percentages resulting from any calculations on the Senior Notes
will be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point rounded upward
(e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)), and
all dollar amounts used in or resulting from such calculation will be rounded to
the nearest cent (with one-half cent being rounded upward).
As used herein, "London Banking Day" means any day on which dealings in
deposits in U.S. Dollars are transacted in the London interbank market.
(c) From and including the Remarketing Settlement Date on which
Replacement Securities are issued, Distributions on the Replacement Securities
and on the Common Securities will be payable quarterly in arrears (i) on January
1, April 1, July 1 and October 1 of each year, commencing on such Remarketing
Settlement Date and (ii) on the Mandatory Redemption Date (each, a "Distribution
Date"), and will accumulate from the most recent date to which Distributions
have been paid or, if no Distributions have been paid, from and including such
Remarketing Settlement Date, to but excluding the related Distribution Date,
except as otherwise described below. From and including the Remarketing
Settlement Date on which Replacement Securities are issued, the amount of
Distributions payable for any quarterly period shall be computed on the basis of
a 360-day year of twelve 30-day months. Except as provided in the last sentence
of this paragraph, from and including such Remarketing Settlement Date the
amount of Distributions payable for any period shorter than a full quarterly
period for which Distributions are computed will be computed on the basis of the
actual number of days elapsed per 30-day month. If a Distribution Date is not a
Business Day, then such Distribution Date will be postponed to the next
I-3
succeeding Business Day (and without any interest or other payment in respect of
any such delay).
(d) Distributions on the Securities will be payable to the Holders
thereof as they appear on the books and records of the Trust on the fifteenth
day prior to each Pre-Remarketing Distribution Date or Distribution Date, as the
case may be. Subject to any applicable laws and regulations and the provisions
of the Agreement, each such payment in respect of the Preferred Securities will
be made in respect of any global certificate representing Securities, to the
Depository (or other applicable Depository), which shall credit the relevant
accounts at the Depository (or such other Depository) on the applicable payment
dates, or in respect of Securities in certificated form, by check mailed to the
address of the Holder entitled thereto as such address shall appear on the
register; provided that at the written request of any Holder of at least
$10,000,000 aggregate Liquidation Amount of Preferred Securities received by the
Property Trustee not later than the fifteenth day prior to the applicable Pre-
Remarketing Distribution Date or Distribution Date, Distributions accrued on
such Preferred Securities will be payable by wire transfer within the
continental United States in immediately available funds to the bank account
number of such holder specified in such request. The relevant record dates for
the Common Securities shall be the same as the record dates for the Preferred
Securities. Distributions payable on any Securities that are not punctually paid
on any Distribution Date, as a result of the Senior Note Issuer having failed to
make a payment under the Senior Notes, will cease to be payable to the Holder on
the relevant record date, and such defaulted Distributions will instead be
payable to the Person in whose name such Securities are registered on the
special record date or other specified date determined in accordance with the
Indenture.
(e) The Distribution Rate on the Trust Securities (as well as the
interest rate on the Senior Notes) shall be reset in the manner provided in
Section 6.03 of the Agreement and in the Indenture.
(f) In the event that there is any money or other property held by or
for the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata (as defined herein) among the Holders of the Securities.
3. Remarketing.
The Preferred Securities shall be remarketed in accordance with the
provisions of Article 6 of the Agreement.
I-4
4. Liquidation Distribution Upon Dissolution.
In the event of any voluntary or involuntary dissolution of the Trust,
the Trust shall be liquidated by the Administrative Trustees as expeditiously as
the Administrative Trustees determine to be possible by distributing pursuant to
Section 5, after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, to the Holders of the Securities a Like Amount (as
defined below) of the Senior Notes, unless such distribution is determined by
the Property Trustee not to be practicable, in which event such Holders will be
entitled to receive out of the assets of the Trust legally available for
distribution to Holders, after satisfaction of liabilities to creditors of the
Trust as provided by applicable law, an amount equal to the aggregate of the
Liquidation Amount of $1,000 per Security plus accumulated and unpaid
Distributions thereon to the date of payment (such amount being the "Liquidation
Distribution").
"Like Amount" means (i) with respect to a redemption of the Securities,
Securities having a Liquidation Amount equal to the principal amount of Senior
Notes to be paid in accordance with their terms and (ii) with respect to a
distribution of Senior Notes upon the dissolution of the Trust, Senior Notes
having a principal amount equal to the Liquidation Amount of the Securities of
the Holder to whom such Senior Notes are distributed.
If, upon any such dissolution, the Liquidation Distribution can be paid
only in part because the Trust has insufficient assets on hand legally available
to pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro Rata basis.
5. Redemption and Distribution.
(a) Upon the repayment of the Senior Notes in whole or in part, at
maturity or upon acceleration or redemption, the proceeds from such repayment
shall be simultaneously applied by the Property Trustee to redeem a Like Amount
of the Securities at the Mandatory Redemption Price (as defined below). In the
case of an early redemption, Holders will be given not less than 30 nor more
than 60 days notice of such redemption. Any redemption of Securities shall be
made, and the Mandatory Redemption Price shall be payable, on the applicable
redemption date, and only to the extent that the Trust has funds legally
available for the payment thereof.
(b) The "Mandatory Redemption Price" shall mean a price equal to 100%
of the Liquidation Amount of the Securities to be redeemed plus accrued and
unpaid Distributions thereon, if any, to the date of redemption.
I-5
(c) If at any time a Tax Event or Investment Company Event (each as
defined in the Trust Agreement) (a "Special Event") occurs, the Senior Note
Issuer shall have the right (subject to the conditions set forth in the
Indenture) at any time, upon not less than 30 nor more than 60 days' notice, to
redeem the Senior Notes in whole but not in part, within the 90 days following
the occurrence of such Special Event (the "90 Day Period"), and, simultaneous
with such redemption, to cause a Like Amount of the Securities to be redeemed by
the Trust at the Mandatory Redemption Price on a Pro Rata basis.
(d) If at any time a Qualifying Offering occurs, the Senior Note Issuer
shall, upon not less than 30 nor more than 60 days' notice, redeem Senior Notes
having an aggregate principal amount equal to the aggregate public offering
price of such Qualifying Offering (without deduction of any applicable
underwriting discounts and commissions) on the 90th day following the closing of
such Qualifying Offering, and, simultaneous with such redemption, cause a like
Amount of the Securities to be redeemed by the Trust at the Mandatory Redemption
Price on a Pro Rata basis.
(e) The Sponsor will have the right, subject to Section 8.01(a)(iii) of
the Agreement, at any time to dissolve the Trust and, after satisfaction of
creditors of the Trust as required by applicable law, cause the Senior Notes to
be distributed to the Holders of the Securities. On and from the date fixed by
the Administrative Trustees for any distribution of Senior Notes and liquidation
of the Trust: (i) the Securities will no longer be deemed to be outstanding and
(ii) the Depository or its nominee (or any successor Depository or its nominee),
as the Holder of the Preferred Securities, will receive a registered global
certificate or certificates representing the Senior Notes to be delivered upon
such distribution and any certificates representing Securities not held by the
Depository or its nominee (or any successor Depository or its nominee) will be
deemed to represent beneficial interests in a Like Amount of Senior Notes until
such certificates are presented to the Senior Note Issuer or its agent for
transfer or reissue. The Senior Notes shall be distributed to the Holders
pursuant to Section 2.04 of the Supplemental Indenture.
(f) Except as provided in Section 5(d) above, the Trust may not redeem
fewer than all the outstanding Securities.
(g) The notice procedure with respect to a redemption pursuant to
Section 5(c) or 5(d) above or distributions of Senior Notes shall be as follows:
(i) Notice of any such redemption of, or notice of distribution
of Senior Notes in exchange for, the Securities (a
"Redemption/Distribution Notice") will be given by an Administrative
Trustee on behalf of the Trust by mail to each Holder of Securities to
be redeemed or exchanged not
I-6
fewer than 30 nor more than 60 days before the date fixed for
redemption or exchange thereof which, in the case of a redemption, will
be the date fixed for redemption of the Senior Notes. For purposes of
the calculation of the date of redemption or exchange and the dates on
which notices are given pursuant to this Section 5(g)(i), a
Redemption/Distribution Notice shall be deemed to be given on the day
such notice is first mailed by first-class mail, postage prepaid, to
Holders of Securities. Each Redemption/Distribution Notice shall be
addressed to the Holders of Securities at the address of each such
Holder appearing in the books and records of the Trust. No defect in
the Redemption/Distribution Notice or in the mailing thereof with
respect to any Holder shall affect the validity of the redemption or
exchange proceedings with respect to any other Holder.
(ii) Redemption/Distribution Notices shall be sent by the
Property Trustee on behalf of the Trust to (A) in respect of the
Preferred Securities, the Depository or its nominee (or any successor
Depository or its nominee) if the Global Preferred Securities have been
issued or, if Definitive Preferred Securities have been issued, to the
Holders thereof, and (B) in respect of the Common Securities, to the
Holder thereof.
(h) The payment procedure with respect to all redemptions shall be as
follows:
(i) If Securities are to be redeemed, then (A) with respect to
Preferred Securities issued in book-entry form, by 12:00 noon, New York
City time, on the redemption date, provided that the Senior Note Issuer
has by 10:00 a.m. New York City time paid the Property Trustee a
sufficient amount of immediately available funds in connection with the
related redemption or maturity of the Senior Notes, the Property
Trustee will deposit irrevocably with the Depository or its nominee (or
successor Depository or its nominee) immediately available funds
sufficient to pay the Mandatory Redemption Price with respect to such
Preferred Securities and will give the Depository irrevocable
instructions and authority to pay the Mandatory Redemption Price to the
relevant Participants and (B) with respect to Preferred Securities
issued in certificated form and Common Securities, provided that the
Senior Note Issuer has paid the Property Trustee a sufficient amount of
cash in connection with the related redemption or maturity of the
Senior Notes, the Property Trustee will pay the Mandatory Redemption
Price to the Holders of such Securities by check mailed to the address
of the relevant Holder appearing on the books and records of the Trust
on the redemption date; provided that at the written request of any
Holder of at least $10,000,000 aggregate Liquidation Amount of
Preferred Securities received by the Property Trustee not later than
9:00 a.m. on the redemption date, the Mandatory
I-7
Redemption Price payable to such Holder will be payable by wire
transfer within the continental United States in immediately available
funds to the bank account number of such Holder specified in such
request. If a Redemption/Distribution Notice, if necessary, shall have
been given and funds deposited as required, if applicable, then on the
date of such deposit, or on the redemption date, as applicable,
Distributions will cease to accumulate on the Securities so called for
redemption and all rights of Holders of such Securities so called for
redemption will cease, except the right of the Holders of such
Securities to receive the Redemption Price, but without interest on
such Redemption Price, and such Securities shall cease to be
outstanding.
(ii) Payment of accrued and unpaid Distributions on the
Redemption Date of the Securities will be subject to the rights of
Holders of Securities on the close of business on a regular record date
in respect of a Distribution Date occurring on or prior to such
redemption date.
(iii) If the Mandatory Redemption Date or any other date fixed for
redemption of Securities is not a Business Day, then payment of the
Mandatory Redemption Price payable on such date will be made on the
next succeeding day that is a Business Day with interest thereon at the
then applicable rate to the date of redemption. If payment of the
Mandatory Redemption Price in respect of any Securities is improperly
withheld or refused and not paid either by the Property Trustee or by
the Sponsor as guarantor pursuant to the relevant Securities Guarantee,
Distributions on such Securities will continue to accrue from the
original redemption date to the actual date of payment, in which case
the actual payment date will be considered the date fixed for
redemption for purposes of calculating the Mandatory Redemption Price.
(i) Neither the Administrative Trustees nor the Trust shall be required
to register or cause to be registered the transfer of any Securities beginning
on the opening of business 15 days before the day of mailing of a
Redemption/Distribution Notice.
(j) Subject to the foregoing, the provisions of the Remarketing
Agreement and applicable law (including, without limitation, United States
Federal securities laws), the Sponsor or any of its subsidiaries may at any time
and from time to time purchase outstanding Preferred Securities by tender, in
the open market or by private agreement.
I-8
6. Voting Rights - Preferred Securities.
(a) Except as provided under Sections 6(b) and 8 and as otherwise
required by law or the Agreement, the Holders of the Preferred Securities will
have no voting rights.
(b) So long as any Senior Notes are held by the Property Trustee, the
Trustees shall not (i) direct the time, method and place of conducting any
proceeding with respect to any remedy available to the Senior Note Trustee, or
exercising any trust or power conferred upon the Senior Note Trustee with
respect to the Senior Notes, (ii) waive any past default that is waivable under
Section 5.13 of the Base Indenture, (iii) exercise any right to rescind or annul
a declaration of acceleration of the maturity of the principal of the Senior
Notes or (iv) consent to any amendment, modification or termination of the
Indenture or the Senior Notes, where such consent shall be required, without, in
each case, obtaining (1) the prior approval of the Holders of a Majority in
Liquidation Amount of all outstanding Preferred Securities; provided that where
a consent under the Indenture would require the consent of each holder of Senior
Notes affected thereby, no such consent shall be given by the Property Trustee
without the prior approval of each Holder of the Preferred Securities and (2) an
Opinion of Counsel delivered to the Trust from independent tax counsel
experienced in such matters to the effect that the Trust will not be classified
as an association or a publicly traded partnership taxable as a corporation for
United States Federal income tax purposes on account of such action.
If an Event of Default under the Agreement has occurred and is
continuing and such event is attributable to the failure of the Senior Note
Issuer to pay principal of or premium, if any, or interest on the Senior Notes
on the date such principal, premium, if any, or interest is otherwise payable
(or in the case of redemption, on the redemption date), then a Holder of
Preferred Securities may directly institute a proceeding against the Senior Note
Issuer and the Guarantor for enforcement of payment to such Holder of the
principal of or premium, if any, or interest on a Like Amount of Senior Notes on
or after the respective due date specified herein or in the Senior Notes (a
"Direct Action"). In connection with such Direct Action, the Common Securities
Holder will be subrogated to the rights of such Holder of Preferred Securities
to the extent of any payment made by the Senior Note Issuer to such Holder of
Preferred Securities in such Direct Action. Except as provided in the second
preceding sentence, the Holders of Preferred Securities will not be able to
exercise directly any other remedy available to the holders of the Senior Notes.
Any approval or direction of Holders of Preferred Securities may be
given at a separate meeting of Holders of Preferred Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to
I-9
written consent without a meeting and without prior notice. The Property Trustee
will cause a notice of any meeting at which Holders of Preferred Securities are
entitled to vote to be mailed to each Holder of record of Preferred Securities.
Each such notice will include a statement setting forth (i) the date of such
meeting (ii) a description of any resolution proposed for adoption at such
meeting on which such Holders are entitled to vote and (iii) instructions for
the delivery of proxies.
No vote or consent of the Holders of the Preferred Securities will be
required for the Trust to redeem and cancel Preferred Securities or to
distribute the Senior Notes in accordance with the Agreement and the terms of
the Securities.
Notwithstanding that Holders of Preferred Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Preferred Securities that are owned by the Sponsor or any Affiliate of the
Sponsor shall not be entitled to vote or consent and shall, for purposes of such
vote or consent, be treated as if they were not outstanding.
The Holders of a Majority in Liquidation Amount of the Preferred
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee in
respect of this Agreement or the Senior Notes or exercising any trust or power
conferred upon the Property Trustee under this Trust Agreement; provided,
however, that, subject to Section 3.09, the Property Trustee shall have the
right to decline to follow any such direction if the Property Trustee being
advised by counsel determines that the action so directed may not lawfully be
taken, or if the Property Trustee in good faith shall, by a Responsible Officer
or Officers of the Property Trustee, determine that the proceedings so directed
would be illegal or involve it in personal liability or be unduly prejudicial to
the rights of Holders of Preferred Securities not party to such direction, and
provided further that nothing in this Trust Agreement shall impair the right of
the Property Trustee to take any action deemed proper by the Property Trustee
and which is not inconsistent with such direction.
7. Voting Rights - Common Securities.
(a) Except as provided under Sections 7(b) and 8 or as otherwise
required by law or the Agreement, the Holders of the Common Securities will have
no voting rights.
(b) So long as any Senior Notes are held by the Property Trustee, the
Trustees shall not (i) direct the time, method and place of conducting any
proceeding with respect to any remedy available to the Senior Note Trustee, or
exercising any trust or power conferred upon the Senior Note Trustee with
respect to the Senior Notes, (ii) waive any past default that is waivable under
Section 5.13
I-10
of the Base Indenture, (iii) exercise any right to rescind or annul a
declaration of acceleration of the maturity of the principal of the Senior Notes
or (iv) consent to any amendment, modification or termination of the Indenture
or the Senior Notes, where such consent shall be required, without, in each
case, obtaining (A) the prior approval of the Holders of a Majority in
Liquidation Amount of all outstanding Common Securities; provided that where a
consent under the Indenture would require the consent of each holder of Senior
Notes affected thereby, no such consent shall be given by the Property Trustee
without the prior approval of each Holder of the Common Securities and (B) an
Opinion of Counsel delivered to the Trust from independent tax counsel
experienced in such matters to the effect that the Trust will not be classified
as an association or a publicly traded partnership taxable as a corporation for
United States Federal income tax purposes on account of such action.
If an Event of Default under the Agreement has occurred and is
continuing and such event is attributable to the failure of the Senior Note
Issuer to pay principal of or premium, if any, or interest on the Senior Notes
on the date such principal, premium, if any, or interest is otherwise payable
(or in the case of redemption, on the redemption date), then a Holder of Common
Securities may institute a Direct Action against the Senior Note Issuer and the
Guarantor for enforcement of payment to such Holder of the principal of or
premium, if any, or interest on a Like Amount of Senior Notes on or after the
respective due date specified in the Senior Notes. Except as provided in the
immediately preceding sentence, the Holders of Common Securities will not be
able to immediately exercise directly any other remedy available to the holders
of the Senior Notes.
Any approval or direction of Holders of Common Securities may be given
at a separate meeting of Holders of Common Securities convened for such purpose,
at a meeting of all of the Holders of Securities in the Trust or pursuant to
written consent without a meeting and without prior notice. The Administrative
Trustees will cause a notice of any meeting at which Holders of Common
Securities are entitled to vote to be mailed to each Holder of record of Common
Securities. Each such notice will include a statement setting forth (i) the date
of such meeting or the date by which such action is to be taken, (ii) a
description of any resolution proposed for adoption at such meeting on which
such Holders are entitled to vote and (iii) instructions for the delivery of
proxies.
No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
the Senior Notes in accordance with the Agreement and these terms of the
Securities.
I-11
8. Amendments to Agreement.
In addition to the requirements set out in Section 12.01 of the
Agreement, the Agreement may be amended from time to time by the Sponsor, the
Property Trustee and the Administrative Trustees, with (i) if such amendment
adversely affects the rights, privileges or preferences of the Holders, the
consent of Holders representing a Majority in Liquidation Amount of all
outstanding Securities, and (ii) receipt by the Trustees of an Opinion of
Counsel of independent tax counsel experienced in such matters to the effect
that such amendment or the exercise of any power granted to the Trustees in
accordance with such amendment will not affect the Trust's status as a grantor
trust for United States Federal income tax purposes or the Trust's exemption
from status as an Investment Company under the Investment Company Act; provided
that without the consent of each Holder of Securities, the Agreement may not be
amended to (i) change the amount or timing of any Distribution on the Securities
or otherwise adversely affect the amount of any Distribution required to be made
in respect of the Securities as of a specified date or (ii) restrict the right
of a Holder of Securities to institute suit for the enforcement of any such
payment on or after such date.
9. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
of Securities according to the aggregate Liquidation Amount of the Securities
held by the relevant Holder in relation to the aggregate Liquidation Amount of
all Securities outstanding unless, in relation to a payment, an Event of Default
under the Agreement has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the
Preferred Securities pro rata according to the aggregate Liquidation Amount of
Preferred Securities held by the relevant Holder relative to the aggregate
Liquidation Amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggregate Liquidation
Amount of Common Securities held by the relevant Holder relative to the
aggregate Liquidation Amount of all Common Securities outstanding.
10. Ranking.
The Preferred Securities rank pari passu with the Common Securities and
payment thereon shall be made Pro Rata with the Common Securities, except that,
if an Event of Default under the Agreement occurs and is continuing, no payments
in respect of Distributions on, or payments upon liquidation, redemption or
otherwise with respect to, the Common Securities shall be made until the Holders
of the Preferred Securities shall be paid in full the Distributions, Mandatory
I-12
Redemption Price, Liquidation Distribution and other payments to which they are
entitled at such time.
11. Acceptance of Securities Guarantees and Indenture.
Each Holder of Preferred Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee, the Common Securities Guarantee and the Indenture.
12. No Preemptive Rights.
The Holders of the Securities shall have no preemptive or similar
rights to subscribe for any additional securities.
13. Miscellaneous.
These terms constitute a part of the Agreement.
The Sponsor will provide a copy of the Agreement, the Preferred
Securities Guarantee or the Common Securities Guarantee (as may be appropriate)
and the Indenture (including any supplemental indenture) to a Holder without
charge on written request to the Sponsor at its principal place of business.
I-13
EXHIBIT A-1
[FORM OF PREFERRED SECURITY CERTIFICATE]
(prior to Remarketing Settlement Date)
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY
NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B)
IT HAS ACQUIRED THE SECURITIES IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT, (2)
AGREES THAT IT WILL NOT PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE
TO SALES OF THE SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES
ACT (OR ANY SUCCESSOR PROVISION) RESELL OR OTHERWISE TRANSFER THE SECURITIES
EVIDENCED HEREBY EXCEPT (A) TO MUTUAL RISK MANAGEMENT LTD. OR ANY AFFILIATE
THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A
UNDER THE SECURITIES ACT OR (C) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT AND (3)
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITIES EVIDENCED
HEREBY ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS
LEGEND WILL BE REMOVED AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO
SALES OF THE SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES
ACT.
FROM AND AFTER THE REMARKETING SETTLEMENT DATE ON WHICH REPLACEMENT SECURITIES
ARE ISSUED, THIS CERTIFICATE SHALL REPRESENT ONLY THE RIGHT TO RECEIVE THE
REMARKETING PRICE, TOGETHER WITH DISTRIBUTIONS ACCRUED TO SUCH REMARKETING
SETTLEMENT DATE, ALL AS PROVIDED IN THE TRUST AGREEMENT, AND SHALL NO LONGER
REPRESENT AN OBLIGATION OF OR INTEREST IN THE TRUST.
A1-1
Certificate Number Number of Preferred Securities
------------------ ------------------------------
Certificate Evidencing Preferred Securities
of
MRM CAPITAL TRUST I
Auction Rate Reset Preferred Securities
(Liquidation Amount $1,000 per Preferred Security)
MRM CAPITAL TRUST I, a statutory business trust created under the laws of
the State of Delaware (the "Trust"), hereby certifies that ______________ (the
"Holder") is the registered owner of ___________ securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the Auction Reset Rate Preferred Securities (Liquidation Amount
$1,000 per Preferred Security) (the "Preferred Securities"). This Preferred
Security is transferable on the books and records of the Trust, in person or by
a duly authorized attorney, upon surrender of this certificate duly endorsed and
in proper form for transfer. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities
represented hereby are specified in and shall in all respects be subject to the
provisions of the Amended and Restated Trust Agreement (the "Agreement") of the
Trust dated as of September 21, 2000, as the same may be amended from time to
time, including the designation of the terms of the Preferred Securities as set
forth in Annex I to the Agreement. Capitalized terms used but not defined herein
shall have the meanings given them in the Agreement. The Sponsor will provide a
copy of the Agreement, the Preferred Securities Guarantee and the Indenture to a
Holder without charge upon written request to the Sponsor at its principal place
of business.
Upon receipt of this certificate, the Holder is bound by the Agreement and
is entitled to the benefits thereof and to the benefits of the Preferred
Securities Guarantee to the extent provided therein.
By acceptance, the Holder agrees (i) to treat, for United States Federal
income tax purposes, the Senior Notes as indebtedness and the Preferred
Securities as evidence of indirect beneficial ownership in the Senior Notes and
(ii) not to take any position for United States Federal Income Tax purposes
which is contrary to the classification of the Trust as a grantor trust.
A1-2
IN WITNESS WHEREOF, the Trust has executed this certificate this ___ day of
___________, ____.
MRM CAPITAL TRUST I
By: ________________________________
Name:
Title: Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the within-mentioned
Agreement.
Dated: __________, ____
THE CHASE MANHATTAN BANK,
as Property Trustee
By: ________________________________
Authorized Officer
A1-3
[FORM OF REVERSE OF SECURITY]
(a) "Distributions" with respect to the Liquidation Amount of $1,000
per Preferred Security (the "Liquidation Amount") will accrue and be payable at
a rate (the "Distribution Rate") (such rate being the rate of interest payable
on the Senior Notes to be held by the Property Trustee) per annum equal to
(i) from and including the Closing Date to but excluding the
earlier of (A) the Remarketing Settlement Date on which the
Replacement Securities are issued and (B) the date such Security is
redeemed, LIBOR plus 150 basis points;
(ii) from and including the Remarketing Settlement Date on which
Replacement Securities are issued to but excluding the date such
Security is redeemed, the Winning Bid Rate; and
(iii) notwithstanding clauses (i) and (ii) above, if such
Security is not redeemed because the Sponsor fails to pay the
principal amount of the Senior Notes on the date such amount becomes
due, then, from and including such due date to but excluding the date
such Security is redeemed, the applicable periodic Distribution Rate,
compounded quarterly, but only to the extent permitted by applicable
law.
Distributions that are not paid when due will bear Additional
Distributions thereon compounded quarterly at the applicable periodic
Distribution Rate specified above (to the extent permitted by applicable law). A
Distribution is payable only to the extent that payments are made in respect of
the Senior Notes held by the Property Trustee and to the extent the Property
Trustee has funds on hand legally available therefor.
(b) Until the Remarketing Settlement Date on which Replacement
Securities are issued, Distributions on this Preferred Security will be payable
quarterly in arrears (i) on January 1, April 1, July 1 and October 1 of each
year, commencing on January 1, 2001 and (ii) on such Remarketing Settlement Date
(each, subject to the last sentence of the immediately succeeding paragraph, a
"Pre-Remarketing Distribution Date"), and will accumulate from and including the
most recent date to which Distributions have been paid or, if no Distributions
have been paid, from the Closing Date, to but excluding the related Pre-
Remarketing Distribution Date, except as otherwise described below.
The Distribution Rate in effect for the period from and including the
Closing Date to but excluding January 2, 2001 shall be the rate determined by
the Calculation Agent two London Banking Days prior to the Closing Date and
shall equal LIBOR plus 150 basis points. The Distribution Rate in effect
thereafter, for
A1-4
each quarterly period from and including the immediately preceding Pre-
Remarketing Distribution Date to but excluding the applicable Pre-Remarketing
Distribution Date, shall be determined by the Calculation Agent two London
Banking Days prior to such immediately preceding Pre-Remarketing Distribution
Date and shall equal LIBOR plus 150 basis points. Prior to the Remarketing
Settlement Date, the amount of Distributions payable for any period shall be
computed on the basis of a 360-day year and the actual number of days elapsed in
such period. If a Pre-Remarketing Distribution Date is not a Business Day, then
such Pre-Remarketing Distribution Date will be the next succeeding Business Day,
except if such Business Day is in the next succeeding calendar month, such
Distribution Date will be the immediately preceding Business Day.
All percentages resulting from any calculations on the Preferred Securities
will be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point rounded upward
(e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)), and
all dollar amounts used in or resulting from such calculations will be rounded
to the nearest cent (with one-half cent being rounded upward).
As used herein, "London Banking Day" means any day on which dealings in
deposits in U.S. Dollars are transacted in the London interbank market.
(c) From and including the Remarketing Settlement Date on which
Replacement Securities are issued, Distributions on the Replacement Securities
will be payable quarterly in arrears (i) on January 1, April 1, July 1 and
October 1 of each year, commencing on the first such date following such
Remarketing Settlement Date and (ii) on the Mandatory Redemption Date (each, a
"Distribution Date"), and will accumulate from the most recent date to which
Distributions have been paid or, if no Distributions have been paid, from and
including such Remarketing Settlement Date, to but excluding the related
Distribution Date, except as otherwise described below. From and including the
Remarketing Settlement Date on which Replacement Securities are issued, the
amount of Distributions payable for any quarterly period shall be computed on
the basis of a 360-day year of twelve 30-day months. Except as provided in the
last sentence of this paragraph, from and including such Remarketing Settlement
Date, the amount of Distributions payable for any period shorter than a full
quarterly period for which Distributions are computed will be computed on the
basis of the actual number of days elapsed per 30-day month. If a Distribution
Date is not a Business Day, then such Distribution Date will be postponed to the
next succeeding Business Day (and without any interest or other payment in
respect of any such delay).
A1-5
Subject to other conditions set forth in the Agreement and the
Indenture, the Property Trustee may, at the direction of the Sponsor, at any
time dissolve the Trust and, after satisfaction of creditors of the Trust as
required by applicable law, cause the Senior Notes to be distributed to the
Holders of the Securities in liquidation of the Trust or, simultaneously with
any redemption of the Senior Notes, cause a Like Amount of the Securities to be
redeemed by the Trust.
This Preferred Security shall be redeemable as provided in the
Agreement.
A1-6
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security to:
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Insert assignee's social security or tax identification number)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
to transfer this Preferred Security 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)
Signature Guarantee/1/:___________________________________
___________________
/1/Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Registrar, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities and Exchange Act of 1934, as amended.
▇▇-▇
▇▇▇▇▇▇▇ ▇-▇
[FORM OF COMMON SECURITY CERTIFICATE]
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT IN COMPLIANCE WITH APPLICABLE LAW
AND THE PROVISIONS OF THE AMENDED AND RESTATED TRUST AGREEMENT OF MRM CAPITAL
TRUST I DATED AS OF SEPTEMBER 21, 2000, AS AMENDED FROM TIME TO TIME.
A2-1
Certificate Number Number of Common Securities
------------------ ---------------------------
Certificate Evidencing Common Securities
of
MRM CAPITAL TRUST I
Auction Rate Reset Common Securities
(Liquidation Amount $1,000 per Common Security)
MRM CAPITAL TRUST I, a statutory business trust created under the laws of
the State of Delaware (the "Trust"), hereby certifies that __________ (the
"Holder") is the registered owner of __________ securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the Auction Rate Reset Common Securities (Liquidation Amount $1,000
per Common Security) (the "Common Securities"). Except as set forth in the
Agreement (as defined herein), the Common Securities are not transferable. The
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities represented hereby are specified in and
shall in all respects be subject to the provisions of the Amended and Restated
Trust Agreement (the "Agreement") of the Trust dated as of September 21, 2000,
as the same may be amended from time to time, including the designation of the
terms of the Common Securities as set forth in Annex I to the Agreement.
Capitalized terms used but not defined herein shall have the meanings given them
in the Agreement. The Sponsor will provide a copy of the Agreement, the Common
Securities Guarantee and the Indenture to a Holder without charge upon written
request to the Sponsor at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the Agreement and
is entitled to the benefits thereof and to the benefits of the Common Securities
Guarantee to the extent provided therein.
By acceptance, the Holder agrees (i) to treat, for United States Federal
income tax purposes, the Senior Notes as indebtedness and the Common Securities
as evidence of indirect beneficial ownership in the Senior Notes and (ii) not to
take any position for United States Federal Income Tax purposes which is
contrary to the classification of the Trust as a grantor trust.
A2-2
IN WITNESS WHEREOF, the Trust has executed this certificate this ___ day of
__________________.
MRM CAPITAL TRUST I
By: __________________________
Name:
Title: Administrative Trustee
A2-3
[FORM OF REVERSE OF COMMON SECURITY]
(a) "Distributions" with respect to the Liquidation Amount of $1,000 per
Common Security (the "Liquidation Amount") will accrue and be payable at a rate
(the "Distribution Rate") (such rate being the rate of interest payable on the
Senior Notes to be held by the Property Trustee) per annum equal to
(i) from and including the Closing Date to but excluding the earlier
of (A) the Remarketing Settlement Date on which the Replacement Securities
are issued and (B) the date such Security is redeemed, LIBOR plus 150 basis
points;
(ii) from and including the Remarketing Settlement Date on which
Replacement Securities are issued to but excluding the date such Security
is redeemed, the Winning Bid Rate; and
(iii) notwithstanding clauses (i) and (ii) above, if such security is
not redeemed because the Sponsor fails to pay the principal amount of the
Senior Notes on the date such amount becomes due, then from and including
such due date to but excluding the date such security is redeemed, the
applicable periodic Distribution Rate, compounded quarterly, but only to
the extent permitted by applicable law.
Distributions that are not paid when due will bear Additional Distributions
thereon compounded quarterly at the applicable periodic Distribution Rate
specified above (to the extent permitted by applicable law). A Distribution is
payable only to the extent that payments are made in respect of the Senior Notes
held by the Property Trustee and to the extent the Property Trustee has funds on
hand legally available therefor.
(b) Until the Remarketing Settlement Date on which Replacement Securities
are issued, Distributions on this Common Security will be payable quarterly in
arrears (i) on January 1, April 1, July 1 and October 1 of each year, commencing
January 1, 2001 and (ii) on such Remarketing Settlement Date (each, subject to
the last sentence of the immediately succeeding paragraph, a "Pre-Remarketing
Distribution Date"), will accumulate from and including the most recent date to
which Distributions have been paid or, if no Distributions have been paid, from
the Closing Date, to but excluding the related Pre-Remarketing Distribution
Date, except as otherwise described below.
The Distribution Rate in effect for the period from and including the
Closing Date to but excluding January 2, 2001 shall be the rate determined by
the Calculation Agent two London Banking Days prior to the Closing Date and
shall equal LIBOR plus 150 basis points. The Distribution Rate in effect
thereafter, for
A2-4
each quarterly period from and including the immediately preceding Pre-
Remarketing Distribution Date to but excluding the applicable Pre-Remarketing
Distribution Date, shall be determined by the Calculation Agent two London
Banking Days prior to such immediately preceding Pre-Remarketing Distribution
Date and shall equal LIBOR plus 150 basis points. Prior to the Remarketing
Settlement Date, the amount of Distributions payable for any period shall be
computed on the basis of a 360-day year and the actual number of days elapsed in
such period. If a Pre-Remarketing Distribution Date is not a Business Day, then
such Pre-Remarketing Distribution Date will be the next succeeding Business Day,
except if such Business Day is in the next succeeding calendar month, such
Distribution Date will be the immediately preceding Business Day.
All percentages resulting from any calculations on the Common Securities
will be rounded, if necessary, to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point rounded upward
(e.g., 9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)), and
all dollar amounts used in or resulting from such calculations will be rounded
to the nearest cent (with one-half cent being rounded upward).
As used herein, "London Banking Day" means any day on which dealings in
deposits in U.S. Dollars are transacted in the London interbank market.
(c) From and including the Remarketing Settlement Date on which
Replacement Securities are issued, Distributions on the Replacement Securities
and on this Common Security will be payable quarterly in arrears (i) on January
1, April 1, July 1 and October 1 of each year, commencing on the first such date
following such Remarketing Settlement Date and (ii) on the Mandatory Redemption
Date (each, a "Distribution Date"), and will accumulate from the most recent
date to which Distributions have been paid or, if no Distributions have been
paid, from and including such Remarketing Settlement Date, to but excluding the
related Distribution Date, except as otherwise described below. From and
including the Remarketing Settlement Date on which Replacement Securities are
issued, the amount of Distributions payable for any quarterly period shall be
computed on the basis of a 360-day year of twelve 30-day months. Except as
provided in the last sentence of this paragraph, from and including such
Remarketing Settlement Date, the amount of Distributions payable for any period
shorter than a full quarterly period for which Distributions are computed will
be computed on the basis of the actual number of days elapsed per 30-day month.
If a Distribution Date is not a Business Day, then such Distribution Date will
be postponed to the next succeeding Business Day (and without any interest or
other payment in respect of any such delay).
A2-5
Subject to other conditions set forth in the Agreement and the Indenture,
the Property Trustee may, at the direction of the Sponsor, at any time dissolve
the Trust and, after satisfaction of creditors of the Trust as required by
applicable law, cause the Senior Notes to be distributed to the Holders to the
Securities in liquidation of the Trust or, simultaneously with any redemption of
the Senior Notes, cause a Like Amount of the Securities to be redeemed by the
Trust.
This Common Security shall be redeemable as provided in the Agreement.
▇▇-▇
▇▇▇▇▇▇▇ ▇-▇
[FORM OF REPLACEMENT PREFERRED SECURITY CERTIFICATE]
THESE SECURITIES ARE GLOBAL SECURITIES WITHIN THE MEANING OF THE AGREEMENT
HEREINAFTER REFERRED TO AND ARE REGISTERED IN THE NAME OF THE DEPOSITORY TRUST
COMPANY (THE "DEPOSITORY") OR A NOMINEE OF THE DEPOSITORY. THESE SECURITIES ARE
EXCHANGEABLE FOR 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 THESE SECURITIES (OTHER THAN A TRANSFER OF
THESE SECURITIES 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 THESE SECURITIES ARE PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY SECURITIES ISSUED ARE REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY
NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B)
IT HAS ACQUIRED THE SECURITIES IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT, (2)
AGREES THAT IT WILL NOT PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE
TO SALES OF THE SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE
SECURITIES ACT (OR ANY SUCCESSOR PROVISION) RESELL OR OTHERWISE TRANSFER THE
SECURITIES
A3-1
EVIDENCED HEREBY EXCEPT (A) TO MUTUAL RISK MANAGEMENT LTD. OR ANY AFFILIATE
THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A
UNDER THE SECURITIES ACT OR (C) IN AN OFFSHORE TRANSACTION MEETING THE
REQUIREMENTS OF RULE 903 OR 904 OF REGULATION S UNDER THE SECURITIES ACT, AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITIES EVIDENCED
HEREBY ARE TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS
LEGEND WILL BE REMOVED AFTER THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO
SALES OF THE SECURITIES EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES
ACT.
A3-2
Certificate Number Number of Preferred Securities
------------------ -------------------------------
CUSIP NO. __________
Certificate Evidencing Replacement Preferred Securities
of
MRM CAPITAL TRUST I
Replacement Auction Rate Reset Preferred Securities
(Liquidation Amount $1,000 per Preferred Security)
MRM CAPITAL TRUST I, a statutory business trust formed under the laws of
the State of Delaware (the "Trust"), hereby certifies that ______________ (the
"Holder") is the registered owner of __________ securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the Auction Rate Reset Preferred Securities (Liquidation Amount
$1,000 per Preferred Security) (the "Preferred Securities"). Subject to the
terms of the Agreement (as defined below), this Preferred Security is
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities
represented hereby are specified in and shall in all respects be subject to the
provisions of the Amended and Restated Trust Agreement (the "Agreement") of the
Trust dated as of September 21, 2000, as the same may be amended from time to
time, including the designation of the terms of the Preferred Securities as set
forth in Annex I to the Agreement. Capitalized terms used but not defined herein
shall have the meanings given them in the Agreement. The Sponsor will provide a
copy of the Agreement, the Preferred Securities Guarantee and the Indenture to a
Holder without charge upon written request to the Sponsor at its principal place
of business.
Upon receipt of this certificate, the Holder is bound by the Agreement and
is entitled to the benefits thereof and to the benefits of the Preferred
Securities Guarantee to the extent provided therein.
By acceptance, the Holder agrees to treat, for United States Federal income
tax purposes, the Senior Notes as indebtedness and the Preferred Securities as
evidence of indirect beneficial ownership in the Senior Notes.
A3-3
IN WITNESS WHEREOF, the Trust has executed this certificate this ___ day of
_________, ____.
MRM CAPITAL TRUST I
By: __________________________
Name:
Title: Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the within-mentioned
Agreement.
Dated:
THE CHASE MANHATTAN BANK,
as Property Trustee
By: __________________________
Authorized Officer
A3-4
[FORM OF REVERSE OF SECURITY]
"Distributions" with respect to the Liquidation Amount of $1,000 per
Security (the "Liquidation Amount") will accrue and be payable at a rate (the
"Distribution Rate", such rate being the rate of interest payable on the Senior
Notes to be held by the Property Trustee) per annum equal to
(i) from and including the date of issuance to but excluding the
date such Securities are redeemed, the Winning Bid Rate; and
(ii) notwithstanding clause (i) above, if the Securities are not
redeemed because the Sponsor fails to pay the principal amount of the
Senior Notes on the date such amount becomes due, then from and including
such due date to but excluding the date the Securities are redeemed, the
applicable periodic Distribution Rate, compounded quarterly, but only to
the extent permitted by applicable law.
Distributions that are not paid when due will bear Additional Distributions
thereon compounded quarterly at the applicable periodic Distribution Rate
specified above (to the extent permitted by applicable law). A Distribution is
payable only to the extent that payments are made in respect of the Senior Notes
held by the Property Trustee and to the extent the Property Trustee has funds on
hand legally available therefor.
From and including the Remarketing Settlement Date on which Replacement
Securities are issued, Distributions on the Replacement Securities will be
payable quarterly in arrears (i) on January 1, April 1, July 1 and October 1 of
each year, commencing on the first such date following such Remarketing
Settlement Date and (ii) on the Mandatory Redemption Date (each, a "Distribution
Date"), and will accumulate from the most recent date to which Distributions
have been paid or, if no Distributions have been paid, from and including such
Remarketing Settlement Date, to but excluding the related Distribution Date,
except as otherwise described below. The amount of Distributions payable for any
quarterly period shall be computed on the basis of a 360-day year of twelve 30-
day months. Except as provided in the last sentence of this paragraph, the
amount of Distributions payable for any period shorter than a full quarterly
period for which Distributions are computed will be computed on the basis of the
actual number of days elapsed per 30-day month. If a Distribution Date is not a
Business Day, then such Distribution Date will be the next succeeding Business
Day (and without any interest or other payment in respect of any such delay).
Subject to certain conditions set forth in the Agreement and the Indenture,
the Trust may, at the option of the Sponsor, be dissolved and, after
satisfaction of creditors of the Trust as required by applicable law, the
Property Trustee shall cause
A3-5
the Senior Notes to be distributed to the Holders of the Securities in
liquidation of the Trust or, simultaneously with any redemption of the Senior
Notes, cause a Like Amount of the Securities to be redeemed by the Trust.
This Preferred Security shall be redeemable as provided in the Agreement.
A3-6
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security to:
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Insert assignee's social security or tax identification number)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
to transfer this Preferred Security 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)
Signature Guarantee/2/:___________________________________
____________________________
/2/Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Registrar, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities and Exchange Act of 1934, as amended.
A3-7
EXHIBIT B
[Insert Specimen Senior Note]
EXHIBIT C
[Insert Purchase Agreement]
EXHIBIT D
[Insert Remarketing Agreement]