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TRUST AGREEMENT
OF
BANCORP HAWAII CAPITAL TRUST 1
TRUST AGREEMENT ("Declaration") dated and effective as of December
30, 1996 by the Trustees (as defined herein), the Sponsor (as defined herein),
and by the holders from time to time, of undivided beneficial interests in the
Trust to be issued pursuant to this Declaration;
WHEREAS, the Trustees and the Sponsor desire to establish Bancorp
Hawaii Capital Trust 1 (the "Trust") pursuant to the Delaware Business Trust Act
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 Debentures of the Debentures Issuer;
NOW, THEREFORE, it being the intention of the parties hereto that
the Trust constitute a business trust under the Delaware Business Trust Act and
that this Declaration constitute the governing instrument of such business
trust.
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined in
the preamble above have the respective meanings assigned to
them in this Section 1.1;
(b) a term defined anywhere in this Declaration has the same
meaning throughout;
(c) all references to "the Declaration" or "this Declaration" are
to this Trust Agreement as modified, supplemented or amended
from time to time;
(d) all references in this Declaration to Articles and
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Sections are to Articles and Sections of this Declaration
unless otherwise specified; and
(e) a reference to the singular includes the plural and vice
versa.
"Administrative Trustee" means any Trustee other than the Delaware
Trustee and the Property Trustee.
"Affiliate" has the same meaning as given to that term in Rule 405
of the Securities Act or any successor rule thereunder.
"Business Day" means any day other than a day on which banking
institutions in New York, New York are authorized or required by law to close.
"Capital Security" means a security representing an undivided
beneficial interest in the assets of the Trust with such terms as may be set out
in this Declaration or in any amendment or restatement hereof.
"Capital Security Holders" means the persons acquiring Capital
Securities and holding the same, from time to time.
"Certificate of Trust" shall mean the certificate of trust to be
filed pursuant to Section 3810 of the Delaware Business Trust Act.
"Commission" means the Securities and Exchange Commission.
"Common Security" means a security representing an undivided
beneficial interest in the assets of the Trust having such rights and with terms
as may be set out in this Declaration or in any amendment or restatement hereof.
"Common Security Holder" means the Parent, as the owner of the
Common Securities.
"Company Indemnified Person" means (a) any Administrative Trustee;
(b) any Affiliate of any Administrative Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Administrative Trustee; or (d)
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any employee or agent of the Trust or its Affiliates.
"Covered Person" means (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates and (b) any holder of Securities.
"Debenture Issuer" means the Parent in its capacity as the issuer
of the Debentures under the Indenture.
"Debentures" means the series of Debentures to be issued by the
Debenture Issuer and acquired by the Trust.
"Debenture Trustee" means The Bank of New York, as trustee under
the Indenture until a successor is appointed thereunder, and thereafter means
such successor trustee.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from time
to time, or any successor legislation.
"Delaware Trustee" has the meaning set forth in Section 3.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time or any successor legislation.
"Fiduciary Indemnified Person" has the meaning set forth in Section
4.3(b).
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the indenture to be entered into between the
Parent and the Debenture Trustee and any indenture supplemental thereto pursuant
to which the Debentures are to be issued or governed.
"Offering Circular" has the meaning set forth in Section 2.6(b)(i).
"Parent" means Bancorp of Hawaii, Inc., a Delaware corporation or
any successor entity in a merger, consolidation or
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similar reorganization.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"PORTAL" has the meaning set forth in Section 2.6(b)(iii).
"Property Trustee" has the meaning set forth in Section 3.4.
"Purchase Agreement" means the Purchase Agreement by and among the
Parent, the Trust UBS Securities LLC, Credit Suisse First Boston and Salomon
Brothers Inc.
"Securities" means the Common Securities and the Capital
Securities.
"Securities Act" means the Securities Act of 1933, as amended from
time to time, or any successor legislation.
"Sponsor" means the Parent in its capacity as sponsor of the Trust.
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office 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.
ARTICLE II
ORGANIZATION
SECTION 2.1 Name.
The Trust created by this Declaration is named "Bancorp
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Capital Trust 1." The Trust's activities may be conducted under the name of the
Trust or any other name deemed advisable by the Administrative Trustees.
SECTION 2.2 Office.
The address of the principal office of the Trust is 000 Xxxxxxxx
Xxxxxx, Xxxxxxxx, Xxxxxx 00000. At any time, the Administrative Trustees may
designate another principal office of the Trust.
SECTION 2.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to issue
and sell Securities and use the proceeds from such sale to acquire the
Debentures, (b) to distribute the Trust's income as provided in this Declaration
or any amendment or restatement hereof and (c) except as otherwise limited
herein, to engage in only those other activities necessary, or incidental
thereto. 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.
SECTION 2.4 Declaration and Authority.
(a) The Trustees declare that all assets contributed to the Trust
will be held in trust for the benefit of the holders, from time to
time, of the securities representing undivided beneficial interests in
the assets of the Trust issued hereunder, subject to the provisions of
this Declaration. The Sponsor hereby contributes the sum of $10 to be
held by the Trustees hereunder and to which all other assets of the
Trust, from time to time, shall be added.
(b) Subject to the limitations provided in this Declaration, the
Administrative Trustees shall have exclusive and complete authority to
carry out the purposes of the Trust. An action taken by the
Administrative Trustees in accordance with their powers shall
constitute the act of and serve to bind the Trust. In dealing with the
Administrative Trustees
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acting on behalf of the Trust, no person shall be required to inquire
into the authority of the Administrative Trustees to bind the Trust.
Persons dealing with the Trust are entitled to rely conclusively on the
power and authority of the Administrative Trustees as set forth in this
Declaration.
SECTION 2.5 Title to Property of the Trust.
Legal title to all assets of the Trust shall be vested in the
Trust.
SECTION 2.6 Powers of the Trustees.
The Administrative Trustees shall have the exclusive power and
authority to cause the Trust to engage in the following activities:
(a) to issue and sell the Capital Securities and the Common
Securities in accordance with this Declaration; provided, however,
that the Trust may issue no more than one series of Capital
Securities and no more than one series of Common Securities, and ,
provided, further, that there shall be no interests in the Trust
other the Securities and the issuance of the Securities shall be
limited to the simultaneous issuance of both Capital and Common
Securities on the date the Capital Securities are initially sold
and any other date Capital Securities and Common Securities are
sold pursuant to any over-allotment option granted by the Trust
under the Purchase Agreement;
(b) in connection with the issuance and sale of the Capital
Securities, at the direction of the Sponsor, to:
(i) permit the use of an offering circular (the "Offering
Circular") in preliminary and final form prepared by the Sponsor,
in relation to the offering and sale of Capital Securities to
qualified institutional buyers in reliance on Rule 144A under the
Securities Act and outside the United States to non U.S. persons in
offshore transactions in reliance on Regulation S under the
Securities Act and to execute and file with the Commission, at such
time as
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determined by the Sponsor, a registration statement filed on Form
S-3 prepared by the Sponsor, including any amendments thereto in
relation to the Capital Securities;
(ii) execute and file any documents prepared by the Sponsor,
or take any acts as determined by the Sponsor to be necessary in
order to qualify or register all or part of the Capital Securities
in any State in which the Sponsor has determined to qualify or
register such Capital Securities for sale;
(iii) execute and file an application, prepared by the
Sponsor, to the Private Offerings, Resale and Trading through
Automated Linkages ("PORTAL") Market and, at such time as
determined by the Sponsor to the New York Stock Exchange or any
other national stock exchange or the Nasdaq National Market for
listing or quotation of the Capital Securities;
(iv) execute and enter into the Purchase Agreement and pricing
agreement providing for the sale of the Capital Securities;
(c) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors,
advisors, and consultants and provide for reasonable compensation for
such services;
(d) to incur expenses which are necessary or incidental to carry
out any of the purposes of this Declaration; and
(e) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing.
SECTION 2.7 Filing of Certificate of Trust.
On the date of execution of this Declaration, the Trustees shall
cause the filing of the Certificate of Trust for the Trust in the form attached
hereto as Exhibit A with the
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Secretary of State of the State of Delaware.
SECTION 2.8 Duration of Trust.
The Trust, absent termination pursuant to the provisions of Section
5.2, shall have existence for fifty-four (54) years from the date hereof.
SECTION 2.9 Responsibilities of the Sponsor.
In connection with the issuance and sale of the Capital Securities,
the Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
(a) to prepare for filing by the Administrative Trustee on behalf
of Trust with the Commission a registration statement on Form S-3 in
relation to the Capital Securities, including any amendments thereto;
(b) to determine the States in which to take appropriate action to
qualify or register for sale of all or part of the Capital Securities
or the Common Securities and to do any and all such acts, other than
actions which must be taken by the Trust, and advise the Trust of
actions it must take, and prepare for execution and filing any
documents to be executed and filed by the Trust, as the Sponsor deems
necessary or advisable in order to comply with the applicable laws of
any such States;
(c) to prepare for filing by the Trust an application to PORTAL for
listing upon notice of issuance of any Capital Securities;
(d) to negotiate the terms of the Purchase Agreement providing for
the sale of the Capital Securities.
SECTION 2.10 Declaration Binding on Securities Holders.
Every Person by virtue of having become a holder of a Security or
any interest therein in accordance with the terms of this Declaration, shall be
deemed to have expressly assented and agreed to the terms of, and shall be bound
by, this Declaration.
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ARTICLE III
TRUSTEES
SECTION 3.1 Trustees.
The number of Trustees initially shall be four (4), and thereafter
the number of Trustees shall be such number as shall be fixed from time to time
by a written instrument signed by the Sponsor. The Sponsor is entitled to
appoint or remove without cause any Trustee at any time; provided, however, that
the number of Trustees shall in no event be less than two (2); provided,
however, that one Trustee, in the case of a natural person, shall be a person
who is a resident of the State of Delaware or that, if not a natural person, is
an entity which has its principal place of business in the State of Delaware
(the "Delaware Trustee"); provided further that there shall be at least one
trustee who is an employee or officer of, or is affiliated with the Parent (an
"Administrative Trustee").
SECTION 3.2 Administrative Trustees.
The initial Administrative Trustees shall be:
Xxxxx X. Xxxxx
Xxxxxx X. Xxxxxx
(a) Except as expressly set forth in this Declaration, any power of
the Administrative Trustees may be exercised by, or with the consent of, any one
such Administrative Trustee.
(b) Unless otherwise determined by the Administrative Trustees, and
except as otherwise required by the Delaware Business Trust Act, any
Administrative Trustee 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 2.6 provided, that, the
registration statement referred to in Section 2.6(b)(i), including any
amendments thereto, shall be signed by a majority of the Administrative
Trustees; and
(c) an Administrative Trustee may, by power of attorney consistent
with applicable law, delegate to any other
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natural person over the age of 21 his or her power for the purposes of signing
any documents which the Administrative Trustees have power and authority to
cause the Trust to execute pursuant to Section 2.6.
SECTION 3.3 Delaware Trustee.
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
Xxxxx Xxxx Center, Xxxxx 000
Xxxxxx, XX 00000
Attention: Corporate Trust
Notwithstanding any other provision of this Declaration, the
Delaware Trustee shall not be entitled to exercise any of the powers, nor shall
the Delaware Trustee have any of the duties and responsibilities of the
Administrative Trustees described in this Declaration. The Delaware Trustee
shall be a Trustee for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Delaware Business Trust Act. Notwithstanding
anything herein to the contrary, the Delaware Trustee shall not be liable for
the acts or omissions to act of the Trust or of the Administrative Trustees
except such acts as the Delaware Trustee is expressly obligated or authorized to
undertake under this Declaration or the Delaware Business Trust Act and except
for the gross negligence or willful misconduct of the Delaware Trustee.
SECTION 3.4 Property Trustee.
Prior to the issuance of the Capital Securities and Common
Securities, the Sponsor shall appoint another trustee (the "Property Trustee")
meeting the requirements of an eligible trustee of the Trust Indenture Act of
1939, as amended, by the execution of an amendment to or restatement of this
Declaration executed by the Administrative Trustees, the Sponsor, the Property
Trustee and the Delaware Trustee.
SECTION 3.5 Not Responsible for Recitals or Sufficiency of Declaration.
The recitals contained in this Declaration shall be
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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
Declaration.
SECTION 3.6 Compensation of Trustees.
The Depositor agrees:
(a) to pay the Trustees from time to time reasonable compensation
for all services rendered by them hereunder (which compensation shall
not be limited by any provision of law in regard to the compensation of
a trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and
advances incurred or made by the Trustees in accordance with any
provision of this Trust Agreement (including the reasonable
compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith;
(c) To the fullest extent possible the parties intend that Section
3561 of Title 12 of the Delaware Code shall not apply to the Trust and
that compensation paid pursuant to Section 3.6(a) not be subject to
review by any court under Section 3560 of Title 12 of the Delaware
Code.
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ARTICLE IV
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 4.1 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's gross negligence or
willful misconduct with respect to such acts or omissions; and
(b) an Indemnified Person shall be fully protected in relying in
good faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Trust, including information, opinions, reports or
statements as to the value and amount of the 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 4.2 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person
has duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law or in equity, are agreed by the
parties hereto to replace such other duties and liabilities of such Indemnified
Person;
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(b) unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between
Covered Persons; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified
Person shall act in a manner that is, or provides terms that
are, fair and reasonable to the Trust or any holder of
Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise; and
(c) whenever in this Declaration an Indemnified Person is permitted
or required to make a decision:
(i) in its "discretion" or under a grant of similar authority,
the Indemnified Person shall be entitled to consider such interests
and factors as it desires, including its own interests, and shall
have no duty or obligation to give any consideration to any
interest of or factors affecting the Trust or any other Person; or
(ii) in its "good faith" or another express standard, the
Indemnified Person shall act under such express standard and shall
not be subject to any other or different standard imposed by this
Declaration or by applicable law.
SECTION 4.3 Indemnification.
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The Depositor agrees, to the fullest extent permitted by applicable
law, to indemnify and hold harmless (i) each Trustee, (ii) any Affiliate of any
Trustee, (iii) any officer, director, shareholder, employee, representative or
agent of any Trustee, and (iv) any employee or agent of the Trust or its
Affiliates, (referred to herein as an "Indemnified Person") from and against any
loss, damage, liability, tax, penalty, expense or claim of any kind or nature
whatsoever incurred by such Indemnified Person by reason of the creation,
operation or termination of the Trust or any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of
authority conferred on such Indemnified Person by this Trust Agreement, except
that no Indemnified Person shall be entitled to be indemnified in respect of any
loss, damage or claim incurred by such Indemnified Person by reason of
negligence or willful misconduct with respect to such acts or omissions.
SECTION 4.4 Outside Businesses.
Any Covered Person, the Sponsor and the Delaware Trustee 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 Declaration in and to such independent ventures or the income
or profits derived therefrom and the pursuit of any such venture, even if
competitive with the business of the Trust, shall not be deemed wrongful or
improper. No Covered Person, the Sponsor or the Delaware 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 and the
Delaware 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 opportunity. Any Covered Person and the Delaware Trustee may
engage or be interested in any financial or other transaction with the Sponsor
or any Affiliate of the Sponsor or may act as depositary for, trustee or agent
for or may act on any committee or body of holders of, securities or other
obligations of the Sponsor or its Affiliates.
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ARTICLE V
AMENDMENTS, TERMINATING, MISCELLANEOUS
SECTION 5.1 Amendments.
At any time before the issuance of any Securities, this Declaration
may be amended or restated by, and only by, a written instrument executed by all
of the Administrative Trustees and the Sponsor, provided, however, that no such
amendment shall modify the duties of the Delaware Trustee without the execution
of such Delaware Trustee of such amendment or restatement, as the case may be.
SECTION 5.2 Termination of Trust.
(a) The Trust shall terminate and be of no further force or effect:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a Certificate of Dissolution or its
equivalent with respect to the Sponsor or the failure of the
Sponsor to revive its Charter within ten (10) days following the
revocation of the Sponsor's charter or of the Trust's Certificate
of Trust;
(iii) upon the entry of a decree of judicial dissolution of
the Sponsor, or the Trust;
(iv) before the issuance of any Securities, with the consent
of all of the Administrative Trustees and the Sponsor; and
(v) upon the expiration of the period set forth in Section 2.8
hereof.
(b) as soon an is practicable after the occurrence of an event
referred to in Section 5.2(a), the Trustees shall file a certificate of
cancellation with the Secretary of State of the State of Delaware.
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SECTION 5.3 Governing Law.
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted 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. The provisions of Section 3540 of Title 12 of
the Delaware Code shall not apply to the Trust.
SECTION 5.4 Headings.
Headings contained in this Declaration are inserted for convenience
of reference and do not affect the interpretation of this Declaration or any
provision hereof.
SECTION 5.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
SECTION 5.6 Partial Enforceability.
If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the remainder of
this Declaration, or the application of such provision to persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.
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SECTION 5.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All 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.
IN WITNESS WHEREOF, the undersigned has caused these present to be
executed as of the day and year above written.
THE BANK OF NEW YORK (DELAWARE),
not in its individual
capacity, but solely as
Delaware Trustee
By: /s/ Xxxxxxx Xxxxxxxx
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Name: Xxxxxxx Xxxxxxxx
Title: Assistant Vice President
/s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx, not in his
individual capacity, but
solely as Administrative
Trustee
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx, not in his
individual capacity, but
solely as Administrative
Trustee
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