Exhibit 3.5
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AMENDED AND RESTATED
TRUST AGREEMENT
among
PENNSYLVANIA MANUFACTURERS CORPORATION,
as Depositor,
THE BANK OF NEW YORK (DELAWARE),
as Trustee,
THE BANK OF NEW YORK,
as Property Trustee,
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
Dated as of ______________________________, 1998
PMC CAPITAL I
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PMC Capital I
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Trust Agreement
Act Section Section
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(S) 310(a)(1).................................... 8.07
(a)(2)................................. 8.07
(a)(3)................................. 8.09
(a)(4)................................. Not Applicable
(b).................................... 8.08
(S) 311(a)....................................... 8.13
(b).................................... 8.13
(S) 312(a)....................................... 5.07
(b).................................... 5.07
(c).................................... 5.07
(S) 313(a)....................................... 8.14(a)
(a)(4)................................. 8.14(b)
(b).................................... 8.14(b)
(c).................................... 8.14(a)
(d).................................... 8.14(a), 8.14(b)
(S) 314(a)....................................... 8.15
(b).................................... Not Applicable
(c)(1)................................. 8.16
(c)(2)................................. 8.16
(c)(3)................................. 8.16
(d).................................... Not Applicable
(e).................................... 1.01
(S) 315(a)....................................... 8.01
(b).................................... 8.02, 8.14(b)
(c).................................... 8.01(a)
(d).................................... 8.01, 8.03
(e).................................... Not Applicable
(S) 316(a)....................................... Not Applicable
(a)(1)(A).............................. Not Applicable
(a)(1)(B).............................. Not Applicable
(a)(2)................................. Not Applicable
(b).................................... Not Applicable
(c).................................... Not Applicable
(S) 317(a)(1).................................... Not Applicable
(a)(2)................................. Not Applicable
(b).................................... 5.09
(S) 318(a)....................................... 10.10
TABLE OF CONTENTS
ARTICLE I
Defined Terms
Section 1.01. Definitions................................................................. 1
ARTICLE II
Establishment of the Trust
Section 2.01. Name........................................................................ 9
Section 2.02. Office of the Trustee; Office of the Property Trustee; Principal Place of
Business.................................................................... 9
Section 2.03. Initial Contribution of Trust Property; Organizational Expenses............. 9
Section 2.04. Issuance of the Capital Securities.......................................... 9
Section 2.05. Purchase of Debentures; Issuance of the Common Securities................... 10
Section 2.06. Declaration of Trust........................................................ 10
Section 2.07. Authorization to Enter into Certain Transactions............................ 10
Section 2.08. Assets of Trust............................................................. 14
Section 2.09. Title to Trust Property..................................................... 14
ARTICLE III
Payment Account
Section 3.01. Payment Account............................................................. 14
ARTICLE IV
Distributions; Redemption
Section 4.01. Distributions............................................................... 14
Section 4.02. Redemption.................................................................. 15
Section 4.03. Subordination of Common Securities.......................................... 17
Section 4.04. Payment Procedures.......................................................... 18
Section 4.05. Withholding Tax............................................................. 18
Section 4.06. Tax Returns and Reports..................................................... 19
Section 4.07. Payment of Taxes, Duties, Etc. of the Trust................................. 20
Section 4.08. Payments under Indenture.................................................... 20
ARTICLE V
Trust Securities Certificates
Section 5.01. Initial Ownership........................................................... 19
Section 5.02. The Trust Securities Certificates........................................... 19
Section 5.03. Delivery of Trust Securities Certificates................................... 20
Section 5.04. Registration of Transfer and Exchange of Capital Securities Certificates.... 20
Section 5.05. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates.......... 21
Section 5.06. Persons Deemed Securityholders.............................................. 21
Section 5.07. Access to List of Securityholders' Names and Addresses...................... 21
Section 5.08. Maintenance of Office or Agency............................................. 21
Section 5.09. Appointment of Paying Agent................................................. 22
Section 5.10. Ownership of Common Securities by Depositor................................. 22
Section 5.11. Book-Entry Capital Securities Certificates; Common Securities
Certificate................................................................. 22
Section 5.12. Notices to Clearing Agency.................................................. 23
Section 5.13. Definitive Capital Securities Certificates.................................. 24
Section 5.14. Rights of Securityholders................................................... 25
ARTICLE VI
Acts of Securityholders; Meetings; Voting
Section 6.01. Limitations on Voting Rights................................................ 27
Section 6.02. Notice of Meetings.......................................................... 28
Section 6.03. Meetings of Capital Securityholders......................................... 28
Section 6.04. Voting Rights............................................................... 28
Section 6.05. Proxies, etc................................................................ 28
Section 6.06. Securityholder Action by Written Consent.................................... 29
Section 6.07. Record Date for Voting and Other Purposes................................... 29
Section 6.08. Acts of Securityholders..................................................... 29
Section 6.09. Inspection of Records....................................................... 30
ARTICLE VII
Representations and Warranties
Section 7.01. Representations and Warranties of the Bank and the Property
Trustee..................................................................... 30
Section 7.02. Representations and Warranties of Parent.................................... 31
ARTICLE VIII
The Trustees
Section 8.01. Certain Duties and Responsibilities......................................... 32
Section 8.02. Certain Notices............................................................. 34
Section 8.03. Certain Rights of Property Trustee.......................................... 34
Section 8.04. Not Responsible for Recitals or Issuance of Securities...................... 36
Section 8.05. May Hold Securities......................................................... 36
Section 8.06. Compensation; Indemnity; Fees............................................... 36
Section 8.07. Corporate Property Trustee Required; Eligibility of Trustees................ 37
Section 8.08. Conflicting Interests....................................................... 37
Section 8.09. Co-Trustees and Separate Trustee............................................ 37
Section 8.10. Resignation and Removal; Appointment of Successor........................... 39
Section 8.11. Acceptance of Appointment by Successor...................................... 40
Section 8.12. Merger, Conversion, Consolidation or Succession to Business
of a Trustee................................................................ 41
Section 8.13. Preferential Collection of Claims Against Depositor or Trust................ 41
Section 8.14. Reports by Property Trustee................................................. 42
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Section 8.15. Reports to the Property Trustee............................................. 43
Section 8.16. Evidence of Compliance with Conditions Precedent............................ 43
Section 8.17. Number of Trustees.......................................................... 43
Section 8.18. Delegation of Power......................................................... 43
ARTICLE IX
Termination and Liquidation
Section 9.01. Termination Upon Expiration Date............................................ 44
Section 9.02. Early Termination........................................................... 44
Section 9.03. Termination................................................................. 44
Section 9.04. Liquidation................................................................. 44
Section 9.05. Merger, Consolidation, Amalgamation or Replacement of the Trust............. 46
ARTICLE X
Miscellaneous Provisions
Section 10.01. Expense Agreement.......................................................... 47
Section 10.02. Limitation of Rights of Securityholders.................................... 47
Section 10.03. Amendment.................................................................. 47
Section 10.04. Separability............................................................... 49
Section 10.05. Governing Law.............................................................. 49
Section 10.06. Payments Due on Non-Business Day........................................... 49
Section 10.07. Successors................................................................. 49
Section 10.08. Headings................................................................... 49
Section 10.09. Reports, Notices and Demands............................................... 49
Section 10.10. Agreement Not to Petition.................................................. 50
Section 10.11. Trust Indenture Act; Conflict with Trust Indenture Act..................... 50
Section 10.12. Rights Under Indenture..................................................... 50
Section 10.13. Effectiveness.............................................................. 51
Section 10.14. Intention of the Parties................................................... 51
EXHIBITS
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Exhibit A Certificate of Trust
Exhibit B Form of Certificate Depository Agreement
Exhibit C Form of Common Securities Certificate
Exhibit D Form of Capital Securities Certificate
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AMENDED AND RESTATED TRUST AGREEMENT, dated as of ______________, 1998,
among (i) Pennsylvania Manufacturers Corporation, a Pennsylvania corporation
(the "Depositor" or "Parent"), (ii) The Bank of New York (Delaware), a banking
corporation duly organized and existing under the laws of the State of Delaware,
as Delaware trustee (the "Trustee"), (iii) The Bank of New York, a banking
corporation duly organized and existing under the laws of the State of New York,
as Property Trustee (the "Property Trustee" and, in its separate corporate
capacity and not in its capacity as Property Trustee, the "Bank"), (iv) ▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, an individual, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, an individual, and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, an individual, each of whose address is Pennsylvania Manufacturers
Corporation, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ (each an
"Administrative Trustee" and collectively the "Administrative Trustees") (the
Trustee, the Property Trustee and the Administrative Trustees being referred to
collectively as the "Trustees") and (v) of the several Holders, as hereinafter
defined.
WITNESSETH:
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WHEREAS, the Depositor and the Trustee have heretofore duly declared and
established a business trust pursuant to the Delaware Business Trust Act by the
entering into of that certain Trust Agreement, dated as of September 15, 1998
(the "Original Trust Agreement"), and by the execution and filing by the Trustee
with the Secretary of State of the State of Delaware of the Certificate of
Trust, filed on September 15, 1998, attached as Exhibit A; and
WHEREAS, the Depositor, the Trustee and the Property Trustee desire to amend
and restate the Original Trust Agreement in its entirety as set forth herein to
provide for, among other things, (a) the acquisition by the Trust from the
Depositor of all of the right, title and interest in the Debentures, (b) the
issuance of the Common Securities by the Trust to the Depositor, (c) the
issuance and sale of the Capital Securities by the Trust pursuant to the
Underwriting Agreement and (d) the appointment of the Administrative Trustees;
NOW THEREFORE, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, each party, for the benefit of the
other parties and for the benefit of the Securityholders, hereby amends and
restates the Original Trust Agreement in its entirety and agrees as follows:
ARTICLE I
Defined Terms
Section 1.01. Definitions. For all purposes of this Trust Agreement,
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except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
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(c) unless the context otherwise requires, any reference to an "Article" or
a "Section" refers to an Article or a Section, as the case may be, of this Trust
Agreement; and
(d) the words "herein", "hereof" and "hereunder" and other words of similar
import refer to this Trust Agreement as a whole and not to any particular
Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.08.
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"Additional Amount" means, with respect to Trust Securities of a given
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Liquidation Amount and/or a given period, the amount of Additional Interest (as
defined in the Indenture) paid by the Depositor on a Like Amount of Debentures
for such period.
"Additional Sums" has the meaning specified in Section 1005 of the
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Indenture.
"Administrative Trustee" means each of the individuals identified as an
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"Administrative Trustee" in the preamble to this Trust Agreement, solely in his
capacity as Administrative Trustee of the Trust formed and continued hereunder
and not in his individual capacity, or such Administrative Trustee's successor
in interest in such capacity, or any successor Administrative Trustee appointed
as herein provided.
"Affiliate" of any specified Person means any other Person directly or
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indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Applicable Procedures" means, with respect to any transfer or transaction
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involving a Book-Entry Capital Security, the rules and procedures of the
Clearing Agency for such Book-Entry Capital Security, in each case to the extent
applicable to such transaction and as in effect from time to time.
"Bank" has the meaning specified in the preamble to this Trust Agreement.
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"Bankruptcy Event" means, with respect to any Person:
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(a) the entry of a decree or order by a court having jurisdiction in the
premises judging such Person a bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjudication or
composition of or in respect of such Person under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law, or appointing
a receiver, liquidator, assignee, trustee, sequestrator or other similar
official of such Person or of any substantial part of its property, or ordering
the winding up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 60 consecutive days; or
(b) the institution by such Person of proceedings to be adjudicated a
bankrupt or insolvent, or of the consent by it to the institution of bankruptcy
or insolvency proceedings
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against it, or the filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law, or the consent by it to the
filing of such petition or to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator or similar official of such Person or of any
substantial part of its property or the admission by it in writing of its
inability to pay its debts generally as they become due and its willingness to
be adjudicated as a bankrupt, or the making by it of an assignment for the
benefit of creditors, or the taking of action by such Person in furtherance of
any such action.
"Bankruptcy Laws" has the meaning specified in Section 10.10.
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"Board Resolution" means a copy of a resolution certified by the Secretary
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or an Assistant Secretary of the Depositor to have been duly adopted by the
Depositor's Board of Directors or a duly authorized committee thereof or
officers of the Depositor to which authority to act on behalf of the Board of
Directors has been delegated and to be in full force and effect on the date of
such certification, and delivered to the Property Trustee.
"Book-Entry Capital Securities Certificate" means a Capital Securities
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Certificate evidencing ownership of Book-Entry Capital Securities.
"Book-Entry Capital Security" means a Capital Security, the ownership and
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transfers of which shall be made through book entries by a Clearing Agency as
described in Section 5.11.
"Business Day" means a day other than (a) a Saturday or Sunday, (b) a day on
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which banking institutions in The City of New York are authorized or obligated
by law or executive order to remain closed or (c) a day on which the Property
Trustee's Corporate Trust Office or the Debenture Trustee's Corporate Trust
Office is closed for business.
"Capital Securities Certificate" means a certificate evidencing ownership of
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Capital Securities, substantially in the form attached as Exhibit D.
"Capital Security" means an undivided beneficial interest in the assets of
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the Trust, having a Liquidation Amount of $1,000 and having rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.
"Certificate Depository Agreement" means the agreement among the Trust, the
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Depositor and The Depository Trust Company, as the initial Clearing Agency,
dated as of the Closing Date, relating to the Capital Securities Certificates,
substantially in the form attached as Exhibit B, as the same may be amended and
supplemented from time to time.
"Clearing Agency" means an organization registered as a "clearing agency"
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pursuant to Section 17A of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). The Depository Trust Company will be the initial Clearing
Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other financial
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institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
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"Closing Date" means the First Time of Delivery as defined in the
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Underwriting Agreement, which date is also the date of execution and delivery of
this Trust Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
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"Commission" means the Securities and Exchange Commission, as from time to
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time constituted, created under the Exchange Act or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Securities Certificate" means a certificate evidencing ownership of
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Common Securities, substantially in the form attached as Exhibit C.
"Common Security" means an undivided beneficial interest in the assets of
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the Trust, having a Liquidation Amount of $1,000 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.
"Corporate Trust Office" means the principal office of either the Property
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Trustee or the Trustee named in the Indenture. So long as The Bank of New York
serves in both capacities, such principal office is located in ________________.
"Debenture Event of Default" means an "Event of Default" as defined in the
--------------------------
Indenture.
"Debenture Redemption Date" means "Redemption Date" as defined in the
-------------------------
Indenture.
"Debenture Trustee" means The Bank of New York, a banking corporation duly
-----------------
organized and existing under the laws of the State of New York.
"Debentures" means the $103,093,000 aggregate principal amount of the
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Parent's ____% Junior Subordinated Debentures, Series A issued pursuant to the
Indenture.
"Definitive Capital Securities Certificates" means either or both (as the
------------------------------------------
context requires) of (a) Capital Securities Certificates issued as Book-Entry
Capital Securities Certificates as provided in Section 5.11(a) and (b) Capital
Securities Certificates issued in certificated, fully registered form as
provided in Section 5.13.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the Delaware
---------------------------
Code, 12 Del. C. (S) 3801, et seq., as it may be amended from time to time.
"Depositor" has the meaning specified in the preamble to this Trust
---------
Agreement and includes Pennsylvania Manufacturers Corporation in its capacity as
Holder of the Common Securities.
"Direct Action" has the meaning specified in Section 5.14(c).
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"Distribution Date" has the meaning specified in Section 4.01(a).
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"Distributions" means amounts payable in respect of the Trust Securities as
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provided in Section 4.01.
"Event of Default" means any one of the following events (whatever the
----------------
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of a Debenture Event of Default; or
(b) default by the Property Trustee in the payment of any Distribution when
it becomes due and payable, and continuation of such default for a period of 30
days; or
(c) default by the Property Trustee in the payment of any Redemption Price
of any Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect, of any
covenant or warranty of the Trustees in this Trust Agreement (other than a
covenant or warranty a default in the performance of which or the breach of
which is dealt with in clause (b) or (c), above) and continuation of such
default or breach for a period of 60 days after there has been given, by
registered or certified mail, to the defaulting Trustee or Trustees by the
Holders of at least 25% in aggregate Liquidation Amount of the Outstanding
Capital Securities a written notice specifying such default or breach and
requiring it to be remedied and stating that such notice is a "Notice of
Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and the failure by the Depositor to appoint a successor Property Trustee
within 60 days thereof.
"Expense Agreement" means the Agreement as to Expenses and Liabilities
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between the Parent and the Trust, substantially in the form attached as Exhibit
A to the Indenture, as amended from time to time.
"Guarantee" means the Guarantee Agreement executed and delivered by the
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Parent and The Bank of New York, a banking corporation, as trustee,
contemporaneously with the execution and delivery of this Trust Agreement, for
the benefit of the Holders of the Capital Securities, as amended from time to
time.
"Indenture" means the Junior Subordinated Indenture, dated as of
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_____________________, 1998, between the Parent and the Debenture Trustee, as
trustee, as amended or supplemented from time to time.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of trust,
----
adverse ownership interest, hypothecation, assignment, security interest or
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust Securities,
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Trust Securities having a Liquidation Amount equal to the principal amount of
Debentures to be
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contemporaneously redeemed in accordance with the Indenture and the proceeds of
which will be used to pay the Redemption Price of such Trust Securities, (b)
with respect to a distribution of Debentures to Holders of Trust Securities in
connection with a dissolution or liquidation of the Trust, Debentures having a
principal amount equal to the Liquidation Amount of the Trust Securities of the
Holder to whom such Debentures are distributed and (c) with respect to any
distribution of Additional Amounts to Holders of Trust Securities, Debentures
having a principal amount equal to the Liquidation Amount of the Trust
Securities in respect of which such distribution is made.
"Liquidation Amount" means the stated amount of $1,000 per Trust Security.
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"Liquidation Date" means the date of dissolution, winding-up or termination
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and liquidation of the Trust pursuant to Section 9.04(a).
"Liquidation Distribution" has the meaning specified in Section 9.04(d).
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"Majority in Liquidation Amount of the Capital Securities" or "Majority in
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Liquidation Amount of the Common Securities" means, except as provided by the
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Trust Indenture Act, Capital Securities or Common Securities, as the case may
be, representing more than 50% of the aggregate Liquidation Amount of all then
Outstanding Capital Securities or Common Securities, as the case may be.
"Officers' Certificate" means a certificate signed by the Chairman of the
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Board, the President or a Senior Vice President and by the Treasurer, Chief
Financial Officer or the Vice President of Finance of the Depositor, and
delivered to the appropriate Trustee. One of the officers signing an Officers'
Certificate given pursuant to Section 8.16 shall be the principal executive,
financial or accounting officer of the Depositor. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
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for the Trust, the Property Trustee or the Depositor, and may be an employee of
any thereof, and who shall be acceptable to the Property Trustee.
"Original Trust Agreement" has the meaning specified in the recitals to this
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Trust Agreement.
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"Outstanding", when used with respect to Trust Securities, means, as of the
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date of determination, all Trust Securities theretofore executed, authenticated
and delivered under this Trust Agreement, except:
(a) Trust Securities theretofore canceled by the Administrative Trustees or
delivered to the Administrative Trustees for cancellation;
(b) Trust Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Property Trustee or any Paying
Agent; provided that, if such Trust Securities are to be redeemed, notice of
such redemption has been duly given pursuant to this Trust Agreement; and
(c) Trust Securities that have been paid or in exchange for or in lieu of
which other Capital Securities have been executed, authenticated and delivered
pursuant to this Trust Agreement; provided, however, that in determining whether
the Holders of the requisite Liquidation Amount of the Outstanding Capital
Securities have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, Capital Securities owned by the Depositor, any
Trustee or any Affiliate of the Depositor or any Trustee shall be disregarded
and deemed not to be Outstanding, except that (a) in determining whether any
Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Capital Securities
which such Trustee knows to be so owned shall be so disregarded and (b) the
foregoing shall not apply at any time when all of the Outstanding Capital
Securities are owned by the Depositor, one or more of the Trustees and/or any
such Affiliate. Capital Securities so owned which have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Administrative Trustees the pledgee's right so to act with
respect to such Capital Securities and that the pledgee is not the Depositor or
any Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of a Book-Entry
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Capital Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the Owner, then as reflected
in the records of a Person maintaining an account with such Clearing Agency
(directly or indirectly, in accordance with the rules of such Clearing Agency).
"Parent" has the meaning specified in the preamble to this Trust Agreement.
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"Paying Agent" means any paying agent or co-paying agent appointed pursuant
------------
to Section 5.09 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate trust
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account maintained by the Property Trustee with the Bank in its corporate trust
department for the benefit of the Securityholders in which all amounts paid in
respect of the Debentures will be held and from which the Property Trustee shall
make payments to the Securityholders in accordance with Section 4.01.
"Person" means any individual, corporation, partnership, joint venture,
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trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
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"Property Trustee" means the commercial bank or trust company identified as
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the "Property Trustee" in the preamble to this Trust Agreement solely in its
capacity as Property Trustee of the Trust heretofore formed and continued
hereunder and not in its individual capacity, or its successor in interest in
such capacity, or any successor Property Trustee appointed as herein provided.
"Redemption Date" means, with respect to any Trust Security to be redeemed,
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the date fixed for such redemption by or pursuant to this Trust Agreement;
provided that each Debenture Redemption Date and the stated maturity of the
Debentures shall be a Redemption Date for a Like Amount of Trust Securities.
"Redemption Price" means, with respect to any date fixed for redemption of
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any Trust Security, the Liquidation Amount of such Trust Security, plus
accumulated and unpaid Distributions to such date, plus the amount of the
premium, if any, paid by the Depositor upon the concurrent redemption of a Like
Amount of Debentures allocated on a pro rata basis (based on Liquidation
Amounts) among the Trust Securities.
"Relevant Trustee" shall have the meaning specified in Section 8.10.
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"Securities Register" and "Securities Registrar" have the respective
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meanings specified in Section 5.04.
"Securityholder" or "Holder" means a Person in whose name a Trust Security
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or Securities is registered in the Securities Register; any such Person shall be
deemed to be a beneficial owner within the meaning of the Delaware Business
Trust Act; provided, however, that in determining whether the Holders of the
requisite amount of Capital Securities have voted on any matter provided for in
this Trust Agreement, then for the purpose of any such determination, so long as
Definitive Capital Securities Certificates have not been issued, the term
Securityholders or Holders as used herein shall refer to Owners.
"Transfer Agent" shall be the person specified in or pursuant to Section
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5.04.
"Trust" means the Delaware business trust created and continued hereby and
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identified on the cover page to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as the
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same may be modified, amended or supplemented in accordance with the applicable
provisions hereof, including all exhibits hereto, including, for all purposes of
this Trust Agreement and any such modification, amendment or supplement, the
provisions of the Trust Indenture Act that are deemed to be a part of and govern
this Trust Agreement and any such modification, amendment or supplement,
respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
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the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
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"Trust Property" means (a) the Debentures, (b) any cash on deposit in, or
--------------
owing to, the Payment Account, (c) all proceeds and rights in respect of the
foregoing and any other property and assets for the time being held or deemed to
be held by the Property Trustee pursuant to the trusts of this Trust Agreement
and (d) the rights of the Property Trustee under the Guarantee.
"Trust Security" means any one of the Common Securities or the Capital
--------------
Securities.
"Trust Securities Certificate" means any one of the Common Securities
----------------------------
Certificates or the Capital Securities Certificates.
"Trustee" means the commercial bank or trust company identified as the
-------
"Trustee" in the preamble to this Trust Agreement solely in its capacity as
Trustee of the Trust heretofore formed and continued hereunder and not in its
individual capacity, or its successor in interest in such capacity, or any
successor Trustee appointed as herein provided.
"Trustees" has the meaning specified in the preamble to this Trust
--------
Agreement.
"Underwriting Agreement" means the Underwriting Agreement, dated as of
----------------------
_________________________, 1998, among the Trust, the Parent, PMA Reinsurance
Corporation and the several underwriters named therein.
ARTICLE II
Establishment of the Trust
Section 2.01. Name. The Trust created and continued hereby shall be known
----
as "PMC Capital I," as such name may be modified from time to time by the
Administrative Trustees following written notice to the Holders of Trust
Securities and the other Trustees, in which name the Trustees may conduct the
business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and ▇▇▇ and be sued.
Section 2.02. Office of the Trustee; Office of the Property Trustee;
------------------------------------------------------
Principal Place of Business. The office of the Trustee in the State of Delaware
---------------------------
is _____________________________, Attention: Corporate Trust Administration, or
such other address in the State of Delaware as the Trustee may designate by
written notice to the Securityholders and the Depositor. The office of the
Property Trustee is _______________________________, New York, New York, or such
other address as the Property Trustee may designate by written notice to the
Securityholders and the Depositor. The principal place of business of the Trust
is c/o Pennsylvania Manufacturers Corporation, The PMA Building, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
Section 2.03. Initial Contribution of Trust Property; Organizational
------------------------------------------------------
Expenses. The Trustee acknowledges receipt in trust from the Depositor in
--------
connection with the Original Trust Agreement of the sum of $10, which
constituted the initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such expenses paid by
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such Trustee. The Depositor shall make no claim upon the Trust Property for the
payment of such expenses.
Section 2.04. Issuance of the Capital Securities. On
----------------------------------
_______________________, 1998 the Depositor, both on its own behalf and on
behalf of the Trust and pursuant to the Original Trust Agreement, executed and
delivered the Underwriting Agreement. Contemporaneously with the execution and
delivery of this Trust Agreement, an Administrative Trustee, on behalf of the
Trust, shall execute and deliver to the underwriters named in the Underwriting
Agreement Capital Securities Certificates, registered in the name of the nominee
of the initial Clearing Agency, in an aggregate amount of 100,000 Capital
Securities having an aggregate Liquidation Amount of $100,000,000, against
receipt of the aggregate purchase price of such Capital Securities of
$100,000,000, which amount the Administrative Trustee shall promptly deliver to
the Property Trustee.
Section 2.05. Purchase of Debentures; Issuance of the Common Securities.
---------------------------------------------------------
Contemporaneously with the execution and delivery of this Trust Agreement, an
Administrative Trustee, on behalf of the Trust, shall purchase from the
Depositor Debentures, registered in the name of the Trust and having an
aggregate principal amount equal to $100,000,000, and, in satisfaction of the
purchase price for such Debentures, (w) the Property Trustee, on behalf of the
Trust, shall deliver to the Depositor the sum of $100,000,000, and (x)
contemporaneously therewith, an Administrative Trustee, on behalf of the Trust,
shall execute and deliver to the Depositor Common Securities Certificates,
registered in the name of the Depositor, in an aggregate amount of 3,093 Common
Securi ties having an aggregate Liquidation Amount of $3,093,000.
Section 2.06. Declaration of Trust. The exclusive purposes and functions
--------------------
of the Trust are (a) to issue and sell the Trust Securities and use the proceeds
from such sale to acquire the Debentures and (b) to engage in those activities
necessary, convenient or incidental thereto. The Depositor hereby appoints the
Trustees as trustees of the Trust, to have all the rights, powers and duties set
forth herein and the Trustees hereby accept such appointment. The Property
Trustee hereby declares that it will hold the Trust Property in trust upon and
subject to the conditions set forth herein for the benefit of the Trust and the
Securityholders. The Administrative Trustees shall have all rights, powers and
duties set forth herein and in accordance with applicable law with respect to
accomplishing the purposes of the Trust.
Section 2.07. Authorization to Enter into Certain Transactions.
------------------------------------------------
(a) The Trustee, the Property Trustee and the Administrative Trustees shall
conduct the affairs of the Trust in accordance with the terms of this Trust
Agreement. Subject to the limitations set forth in paragraph (b) of this
Section, and in accordance with the following provisions (i) and (ii), the
Property Trustee and the Administrative Trustees shall have the authority to
enter into all transactions and agreements determined by the Trustees to be
appropriate in exercising the authority, express or implied, otherwise granted
to the Trustees under this Trust Agreement, and to perform all acts in
furtherance thereof, including without limitation, the following:
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(i) As among the Trustees, the Administrative Trustees shall have the
power, duty and authority to act on behalf of the Trust with respect to the
following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute, deliver and
perform on behalf of the Trust, the Expense Agreement and the Certificate
Depository Agreement and such other agreements as may be necessary or desirable
in connection with the purposes and function of the Trust;
(C) assisting in any registration of the Capital Securities under the
Securities Act of 1933, as amended, and under state securities or blue sky laws,
and the qualification of this Trust Agreement under the Trust Indenture Act;
(D) assisting in any quotation or listing of the Capital Securities
upon the Nasdaq National Market System ("Nasdaq") or such securities exchange or
exchanges as shall be determined by the Depositor and the registration of the
Capital Securities under the Exchange Act and the preparation and filing of all
periodic and other reports and other documents pursuant to the foregoing;
(E) the sending of notices (other than notices of default) and other
information regarding the Trust Securities and the Debentures to the
Securityholders in accordance with this Trust Agreement;
(F) the consent to the appointment of a Paying Agent, authenticating
agent, Securities Registrar and Transfer Agent in accordance with this Trust
Agreement (which consent shall not be unreasonably withheld);
(G) registering transfers of the Trust Securities in accordance with
this Trust Agreement;
(H) to the extent provided in this Trust Agreement, the winding up of
the affairs of and liquidation of the Trust and the preparation, execution and
filing of the certificate of cancellation with the Secretary of State of the
State of Delaware;
(I) unless otherwise determined by the Property Trustee or the Holders
of at least a majority in Liquidation Amount of the Capital Securities, or as
otherwise required by the Delaware Business Trust Act or the Trust Indenture
Act, to execute on behalf of the Trust (either acting alone or together with any
or all of the Administrative Trustees) any documents that the Administrative
Trustees have the power to execute pursuant to this Trust Agreement; and
(J) the taking of any action incidental to the foregoing as the
Trustees may from time to time determine is necessary or advisable to give
effect to the terms of this Trust Agreement and protect and conserve the Trust
Property for the benefit of the Securityholders (without consideration of the
effect of any such action on any particular Securityholder).
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(ii) As among the Trustees, the Property Trustee shall have the power,
duty and authority to act on behalf of the Trust with respect to the following
matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal and any other payments made
in respect of the Debentures in the Payment Account;
(D) the distribution through the Paying Agent of amounts distributable
to the Securityholders in respect of the Trust Securities;
(E) the exercise of all of the rights, powers and privileges of a
holder of the Debentures;
(F) the sending of notices of default and other information regarding
the Trust Securities and the Debentures to the Securityholders in accordance
with this Trust Agreement;
(G) the distribution of the Trust Property in accordance with the
terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement, the winding up of
the affairs of and liquidation of the Trust and the preparation, execution
and filing of the certificate of cancellation with the Secretary of State of
the State of Delaware;
(I) after an Event of Default (other than under paragraph (b), (c), (d)
or (e) of the definition of such term if such Event of Default is by or with
respect to the Property Trustee) the taking of any action incidental to the
foregoing as the Property Trustee may from time to time determine is
necessary or advisable to give effect to the terms of this Trust Agreement
and protect and conserve the Trust Property for the benefit of the
Securityholders (without consideration of the effect of any such action on
any particular Securityholder); and
(J) any of the duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 2.07(a)(i)(E) and (I) herein;
and in the event of a conflict between the action of the Administrative
Trustees and the action of the Property Trustee, the action of the Property
Trustee shall prevail.
(b) So long as this Trust Agreement remains in effect, the Trust (or the
Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, neither the Trustees nor the Trust shall (i) acquire any
investments or engage in any activities not authorized by this Trust Agreement,
(ii) sell, assign, transfer, exchange, mortgage, pledge, set-off or otherwise
dispose of any of the Trust Property or interests therein, including to the
Securityholders, except as expressly provided herein, (iii) take any action that
would result in more than an insubstantial risk that the Trust would be taxable
as a corporation or would fail or cease to qualify as a "grantor trust" for
United States federal income tax
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purposes, (iv) incur any indebtedness for borrowed money or issue any other debt
or (v) take or consent to any action that would result in the placement of a
Lien on any of the Trust Property. The Administrative Trustees shall defend all
claims and demands of all Persons at any time claiming any Lien on any of the
Trust Property adverse to the interest of the Trust or the Securityholders in
their capacity as Securityholders.
(c) In connection with the issue and sale of the Capital Securities, the
Depositor shall have the right and responsibility to assist the Trust with
respect to, or effect on behalf of the Trust, the following (and any actions
taken by the Depositor in furtherance of the following prior to the date of this
Trust Agreement are hereby ratified and confirmed in all respects as actions of
the Trust):
(i) to prepare for filing by the Trust with the Commission and to execute
on behalf of the Trust a registration statement on Form S-3 in relation to the
Capital Securities, including any amendments thereto, and to take any action
necessary or desirable to sell the Capital Securities in a transaction;
(ii) to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Capital Securities and to do any
and all such acts, other than actions which must be taken by or on behalf of the
Trust, and advise the Trustees of actions they must take on behalf of the Trust,
and prepare for execution and filing any documents to be executed and filed by
the Trust or on behalf of the Trust, as the Depositor deems necessary or
advisable in order to comply with the applicable laws of any such States and in
connection with the sale of the Capital Securities;
(iii) to prepare for filing by the Trust and to execute any application to
Nasdaq or any national stock exchange for quotation or listing upon notice of
issuance, as applicable, of any Capital Securities;
(iv) to prepare for filing by the Trust with the Commission and to
execute a registration statement on Form 8-A relating to the registration of the
Capital Securities under Section 12(b) or 12(g) of the Exchange Act, including
any amendments thereto;
(v) to negotiate the terms of, and execute and deliver, the Underwriting
Agreement providing for the sale of the Capital Securities; and
(vi) to take any other actions necessary or desirable to carry out any of
the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the Administrative
Trustees are authorized and directed to conduct the affairs of the Trust and to
operate the Trust so that the Trust will not (i) be deemed to be an "investment
company" required to be registered under the Investment Company Act of 1940, as
amended, or (ii) fail or cease to qualify as a grantor trust for United States
federal income tax purposes and so that the Debentures will be treated as
indebtedness of the Depositor for United States federal income tax purposes. In
this connection, the Depositor and the Administrative Trustees are authorized to
take any action, not inconsistent with applicable law, the Certificate of Trust
or this Trust Agreement, that each of the Depositor and the Administrative
Trustees determines in its discretion to be necessary or desirable for such
purposes as long as such
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action does not adversely affect in any material respect the interests of the
Holders of the Capital Securities. In no event shall the Trustees be liable to
the Trust or the Holders for any failure to comply with this Section that
results from a change in law or regulation or in the interpretation thereof.
(e) All prior actions taken by ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ on behalf of the Parent in furtherance of the Parent's
powers, duties and obligations under the Original Trust Agreement are hereby
ratified and affirmed as actions of the Trust.
Section 2.08. Assets of Trust. The assets of the Trust shall consist of
---------------
the Trust Property.
Section 2.09. Title to Trust Property. Legal title to all Trust Property
-----------------------
shall be vested at all times in the Property Trustee (in its capacity as such)
and shall be held and administered by the Property Trustee for the benefit of
the Trust and the Securityholders in accordance with this Trust Agreement.
ARTICLE III
Payment Account
Section 3.01. Payment Account.
---------------
(a) On or prior to the Closing Date, the Property Trustee shall establish
the Payment Account. The Property Trustee and any agent of the Property Trustee
shall have exclusive control and sole right of withdrawal with respect to the
Payment Account for the purpose of making deposits in and withdrawals from the
Payment Account in accordance with this Trust Agreement. All monies and other
property deposited or held from time to time in the Payment Account shall be
held by the Property Trustee in the Payment Account for the exclusive benefit of
the Securityholders and for distribution as herein provided, including (and
subject to) any priority of payments provided for herein.
(b) The Property Trustee shall deposit in the Payment Account, promptly
upon receipt, all payments of principal of or interest on, and any other
payments or proceeds with respect to, the Debentures. Amounts held in the
Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
ARTICLE IV
Distributions; Redemption
Section 4.01. Distributions.
-------------
(a) The Trust Securities represent undivided beneficial interests in the
Trust Property, and Distributions (including of Additional Amounts) will be made
on the Trust Securities at the rate and on the dates that payments of interest
(including of Additional Interest, as defined in the Indenture) are made on the
Debentures. Accordingly:
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(i) Distributions on the Trust Securities shall be cumulative, and will
accumulate whether or not there are funds of the Trust available for the payment
of Distributions. Distributions shall accumulate from ____________________,
1998, and, except in the event (and to the extent) that the Parent exercises its
right to defer interest payments on the Debentures pursuant to Section 301 of
the Indenture, shall be payable semi-annually in arrears on
________________________ 1 and ___________________ 1 of each year, commencing on
____________________, 1999. If any date on which Distributions are otherwise
payable on the Trust Securities is not a Business Day, then the payment of such
Distribution shall be made on the next succeeding day which is a Business Day
(and without any additional distribution or other payment in respect of any such
delay) except that, if such Business Day is in the next succeeding calendar
year, payment of such Distribution shall be made on the immediately preceding
Business Day, in each case with the same force and effect as if made on the date
on which such payment was originally payable (each date on which distributions
are payable in accordance with this Section 4.01(a), a "Distribution Date").
(ii) Subject to Section 4.03 hereof, all Distributions will be made pro
rata on each of the Trust Securities. Distributions payable on the Capital
Securities shall be fixed at a rate of ________% per annum of the Liquidation
Amount of the Capital Securities. Distributions payable on the Common Securities
shall be fixed at a rate of ________% per annum of the Liquidation Amount of the
Common Securities. The amount of Distributions payable for any full semi-annual
period shall be computed on the basis of twelve 30-day months and a 360-day year
and, for any period shorter than a full monthly period, shall be computed on the
basis of the actual number of days elapsed in such period. Distributions
payable for each full Distribution period shall be computed by dividing the rate
per annum by two. The amount of Distributions payable for any period shall
include the Additional Amounts, if any.
(iii) Distributions on the Trust Securities shall be made by the
Property Trustee from the Payment Account and shall be deemed payable on each
Distribution Date only to the extent that the Trust has funds available in the
Payment Account for the payment of such Distributions.
(b) Distributions on the Trust Securities with respect to a Distribution
Date shall be payable to the Holders thereof as they appear on the Securities
Register for the Trust Securities at the close of business on the relevant
record date, which shall be one Business Day prior to such Distribution Date;
provided, however, that in the event that the Capital Securities do not remain
in book-entry-only form, the relevant record date shall be the date 15 days
prior to the relevant Distribution Date.
Section 4.02. Redemption.
----------
(a) On each Debenture Redemption Date and on the maturity of the
Debentures, the Trust will be required to redeem a Like Amount of Trust
Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by first-
class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior
to the Redemption Date to each Holder of Trust Securities to be redeemed, at
such Holder's address appearing in the Security Register. All notices of
redemption or liquidation shall state:
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(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number or numbers of the Capital Securities affected;
(iv) if less than all the Outstanding Trust Securities are to be
redeemed, the identification and the aggregate Liquidation Amount of the
particular Trust Securities to be redeemed;
(v) that on the Redemption Date the Redemption Price will become due and
payable upon each such Trust Security to be redeemed and that Distributions
thereon will cease to accrue on and after said date, except as provided in
Section 4.2(d) below; and
(vi) the place or places where the Trust Securities are to be surrendered
for the payment of the Redemption Price.
(c) The Trust Securities redeemed on each Redemption Date shall be redeemed
at the Redemption Price with the proceeds from the contemporaneous redemption of
Debentures. Redemptions of the Trust Securities shall be made and the
Redemption Price shall be payable on each Redemption Date only to the extent
that the Trust has funds available in the Payment Account for the payment of
such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect of any
Capital Securities, then, by 12:00 noon, New York time, on the Redemption Date,
subject to Sec tion 4.02(c), the Property Trustee will, so long as the Capital
Securities are in book-entry-only form, irrevocably deposit with the Clearing
Agency for the Capital Securities, funds sufficient to pay the applicable
Redemption Price and will give such Clearing Agency irrevocable instructions and
authority to pay the Redemption Price to the Holders thereof. If the Capital
Securities are no longer in book-entry-only form, the Property Trustee, subject
to Section 4.02(c), will irrevocably deposit with the Paying Agent funds
sufficient to pay the applicable Redemption Price and will give the Paying Agent
irrevocable instruc tions and authority to pay the Redemption Price to the
Holders thereof upon surrender of their Capital Securities Certificates.
Notwithstanding the foregoing, Distributions payable on or prior to the
Redemption Date for any Trust Securities called for redemption shall be payable
to the Holders of such Trust Securities as they appear on the Securities
Register for the Trust Securities on the relevant record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then upon the date of such deposit, all rights of
Securityholders holding Trust Securities so called for redemption will cease,
except the right of such Securityholders to receive the Redemption Price, and
any Distribution payable in respect of the Trust Securities on or prior to the
Redemption Date, but without interest on such Redemption Price, and such Trust
Securities will cease to be outstanding. In the event that any date fixed for
redemption of the Trust Securities is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next succeeding day
which is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day falls in the next calendar
year, such payment will be made on the immediately preceding Business Day, in
each case, with the same force and effect as if made on such date. In the event
that payment of the Redemption Price in respect of any
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Trust Securities called for redemption is improperly withheld or refused and not
paid either by the Trust or by the Depositor pursuant to the Guarantee,
Distributions on such Trust Securities will continue to accumulate, as set forth
in Section 4.01, from the Redemption Date originally established by the Trust
for such Trust Securities to the date such Redemption Price is actually paid, in
which case the actual payment date will be the date fixed for redemption for
purposes of calculating the Redemption Price.
(e) Payment of the Redemption Price on the Trust Securities and
distribution of the Debentures to holders of Capital Securities shall be made to
the recordholders thereof as they appear on the Securities Register for the
Trust Securities on the relevant record date, which shall be one Business Day
prior to the relevant Redemption Date or Liquidation Date, as applicable;
provided, however, that in the event that the Capital Securities do not remain
in book-entry-only form, the relevant record date shall be the date 15 days
prior to the Redemption Date or Liquidation Date, as applicable.
(f) Subject to Section 4.03(a), if less than all the Outstanding Trust
Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of the Trust Securities to be redeemed shall be allocated
proportionally between the Common Securities and the Capital Securities
according to their aggregate Liquidation Amounts. The particular Capital
Securities to be redeemed shall be selected on a pro rata basis (based upon
Liquidation Amounts) not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Capital Securities not previously called
for redemption, by such method (including, without limitation, by lot) as the
Property Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to $1,000 or an integral multiple of
$1,000 in excess thereof) of the Liquidation Amount of the Capital Securities of
a denomination larger than $1,000; provided that so long as the Capital
Securities are in book-entry-only form, such selection shall be made in
accordance with the customary procedures for the Clearing Agency for the Capital
Securities. The Property Trustee shall promptly notify the Security Registrar
in writing of the Capital Securities selected for redemption and, in the case of
any Capital Securities selected for partial redemption, the Liquidation Amount
thereof to be redeemed. For all purposes of this Trust Agreement, unless the
context otherwise requires, all provisions relating to the redemption of the
Capital Securities shall relate, in the case of any aggregate Capital Securities
redeemed or to be redeemed only in part, to the portion of the aggregate
Liquidation Amount of the Capital Securities which has been or is to be
redeemed.
Section 4.03. Subordination of Common Securities.
----------------------------------
(a) Payment of Distributions (including Additional Amounts, if applicable)
on, the Redemption Price of and the Liquidation Distribution in respect of the
Trust Securities, as applicable, shall be made, subject to Section 4.02(f), pro
rata among the Capital Securities and the Common Securities based on the
Liquidation Amount of the Trust Securities; provided, however, that if on any
Distribution Date, Redemption Date or Liquidation Date any Event of Default
resulting from a Debenture Event of Default specified in Section 501(a) or
501(b) of the Indenture shall have occurred and be continuing, no payment of any
Distribution (including Additional Amounts, if applicable) on, or Redemption
Price of, or Liquidation Distribution in respect of, any Common Security, and no
other payment on account of the redemption, liquidation or other acquisition of
the Common Securities, shall
-17-
be made unless payment in full in cash of all accumulated and unpaid
Distributions (including Additional Amounts, if applicable) on all Outstanding
Capital Securities for all distribution periods terminating on or prior thereto,
or in the case of payment of the Redemption Price the full amount of such
Redemption Price on all Outstanding Capital Securities then called for
redemption, or in the case of payment of the Liquidation Distribution the full
amount of such Liquidation Distribution on all Outstanding Capital Securities,
shall have been made or provided for, and all funds available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions (including Additional Amounts, if applicable) on, or the
Redemption Price of, the Capital Securities then due and payable.
(b) In the case of the occurrence of any Event of Default resulting from
any Debenture Event of Default, the Holder of the Common Securities will be
deemed to have waived any right to act with respect to any such Event of Default
under this Trust Agreement until the effect of all such Events of Default with
respect to the Capital Securities have been cured, waived or otherwise
eliminated. Until all such Events of Default under this Trust Agreement with
respect to the Capital Securities have been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the Holders of
the Capital Securities and not on behalf of the Holder of the Common Securities,
and only the Holders of the Capital Securities will have the right to direct the
Property Trustee to act on their behalf.
Section 4.04. Payment Procedures. Payments of Distributions (including
------------------
Additional Amounts if applicable) in respect of the Capital Securities shall be
made at (a) the Corporate Trust Office of the Property Trustee, (b) the
principal office of any Paying Agent or (c) the principal office of the
Securities Registrar and Transfer Agent; provided that payment of any
Distribution may be made, at the option of the Administrative Trustees, by check
mailed to the address of the Person entitled thereto as such address shall
appear on the Securities Register or by wire transfer in immediately available
funds at such place and to such account as may be designated by the Person
entitled thereto as specified in the Securities Register; if the Capital
Securities are held by a Clearing Agency, such payments shall be made either by
check or by wire transfer, at the option of the Paying Agent, to the Clearing
Agency in immediately available funds, which shall credit the relevant Persons'
accounts at such Clearing Agency on the applicable Distribution Dates. Payments
in respect of the Common Securities shall be made in such manner as shall be
mutually agreed between the Property Trustee and the Holder of the Common
Securities.
Section 4.05. Withholding Tax.
---------------
The Trust and the Administrative Trustees shall comply with all withholding
and backup withholding tax requirements under United States federal, state and
local law. The Trust shall request, and the Holders shall provide to the Trust,
such forms or certificates as are necessary to establish an exemption from
withholding and backup withholding tax with respect to each Holder, and any
representations and forms as shall reasonably be requested by the Trust to
assist it in determining the extend of, and in fulfilling, its withholding and
backup withholding tax obligations. The Administrative Trustees shall file
required forms with applicable jurisdictions and, unless an exemption from
withholding and backup withholding tax is properly established by a Holder,
shall remit amounts withheld with respect to the Holder applicable
jurisdictions. To the extent that
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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 claimed overwithholding, 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 required withholding.
Section 4.06. Tax Returns and Reports.
-----------------------
(a) The Administrative Trustees shall prepare (or cause to be prepared), at
the Depositor's expense, and file by January 31 following each calendar year all
federal, state and local tax and information returns and reports required to be
filed by or in respect of the Trust. In this regard, by January 31 following
each calendar year the Administrative Trustees shall (i) prepare and file (or
cause to be prepared or filed) the Internal Revenue Service Form 1041 (or any
successor form) required to be filed in respect of the Trust in each taxable
year of the Trust and (ii) prepare and furnish (or cause to be prepared and
furnished) to each Securityholder the related Internal Revenue Service Form 1099
(or any successor form). The Administrative Trustees shall provide the
Depositor and the Property Trustee with a copy of all such returns, reports and
schedules promptly after such filing or furnishing.
(b) In the event that any withholding tax is imposed on the Trust's payment
to a Securityholder, such tax shall reduce the amount otherwise distributable to
the Securityholder in accordance with this Section. Any Securityholder who is a
nonresident alien individual or which is organized under the laws of a
jurisdiction outside the United States shall, on or prior to the date such
Securityholder becomes a Securityholder, (i) so notify the Trust and the
Trustees, and (ii) either (A) provide the Trust and the Trustees with Internal
Revenue Service Form 1001, 4224, 8709 or W-8, as appropriate, or (b) notify the
Trust and the Trustees that it is not entitled to an exemption from United
States withholding tax or a reduction in the rate thereof on payments of
interest. Any such Securityholder agrees by its acceptance of a Capital
Security, on an ongoing basis, to provide like certification for each taxable
year for which it is necessary to provide such information and to notify the
Trust and the Trustees should subsequent circumstances arise affecting the
information provided the Trustees in clauses (i) and (ii) above. The Trustees
shall be fully protected in relying upon, and each Securityholder by its
acceptance of a Capital Security hereunder agrees to indemnify and hold the
Trustees harmless against all claims or liability of any kind arising in
connection with or related to the Trustees' reliance upon any documents, forms
or information provided by any Securityholder to the Trustees. In addition, if
the Trustees have not withheld taxes on any payment made to any Securityholder,
and the Trustees are subsequently required to remit to any taxing authority any
such amount not withheld, such Securityholder shall return such amount to the
Trustees upon written demand by the Trustees. The Trustees shall be liable only
for direct (but not consequential) damages to any Securityholder due to the
Trustees' violation of the Code and only to the extent such liability is caused
by the Trustees' failure to act in accordance with its standard of care under
this Agreement. The Trustees shall comply with United States federal
withholding and backup withholding tax
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laws and information reporting requirements with respect to any payments to
Securityholders under the Trust Securities.
Section 4.07. Payment of Taxes, Duties, Etc. of the Trust. Upon receipt
-------------------------------------------
under the Debentures of Additional Sums (as defined in the Indenture), the
Property Trustee shall promptly pay any taxes, duties or governmental charges of
whatsoever nature (other than withholding taxes) imposed on the Trust by the
United States or any other taxing authority.
Section 4.08. Payments under Indenture. Any amount payable hereunder to
------------------------
any Holder of Capital Securities (and any Owner with respect thereto) shall be
reduced by the amount of any corresponding payment such Holder (and Owner with
respect to a Holder's Capital Securities) has directly received pursuant to
Section 508 of the Indenture or Section 5.14 of this Trust Agreement.
ARTICLE V
Trust Securities Certificates
Section 5.01. Initial Ownership. Upon the formation of the Trust and the
-----------------
contribution by the Depositor pursuant to Section 2.03 and until the issuance of
the Trust Securities, and at any time during which no Trust Securities are
outstanding, the Depositor shall be the sole beneficial owner of the Trust.
Section 5.02. The Trust Securities Certificates. The Capital Securities
---------------------------------
Certificates shall be issued in minimum denominations of $1,000 Liquidation
Amount and integral multiples of $1,000 in excess thereof, and the Common
Securities Certificates shall be issued in denominations of $1,000 Liquidation
Amount and integral multiples thereof. The Trust Securities Certificates shall
be executed on behalf of the Trust by manual signature of at least one
Administrative Trustee. Trust Securities Certificates bearing the manual
signatures of individuals who were, at the time when such signatures shall have
been affixed, authorized to sign on behalf of the Trust, shall be validly issued
and entitled to the benefits of this Trust Agreement, notwithstanding that such
individuals or any of them shall have ceased to be so authorized prior to the
delivery of such Trust Securities Certificates or did not hold such offices at
the date of delivery of such Trust Securities Certificates. A transferee of a
Trust Securities Certificate shall become a Securityholder, and shall be
entitled to the rights and subject to the obligations of a Securityholder
hereunder, upon due registration of such Trust Securities Certificate in such
transferee's name pursuant to Section 5.04.
Section 5.03. Delivery of Trust Securities Certificates. On the Closing
-----------------------------------------
Date, the Administrative Trustees shall cause Trust Securities Certificates, in
an aggregate Liquidation Amount as provided in Sections 2.04 and 2.05, to be
executed on behalf of the Trust and delivered to or upon the written order of
the Depositor, executed by one authorized officer thereof, without further
corporate action by the Depositor, in authorized denominations.
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Section 5.04. Registration of Transfer and Exchange of Capital Securities
-----------------------------------------------------------
Certificates. The Property Trustee shall keep or cause to be kept, at the office
------------
or agency maintained pursuant to Section 5.08, a register or registers for the
purpose of registering Trust Securities Certificates and transfers and exchanges
of Trust Securities Certificates (the "Securities Register") in which, subject
to such reasonable regulations as it may prescribe, the Securities Registrar
shall provide for the registration of Capital Securities Certificates and Common
Securities Certificates (subject to Section 5.10 in the case of Common
Securities Certificates) and registration of transfers and exchanges of Capital
Securities Certificates as herein provided. The Bank shall be the initial
Securities Registrar and Transfer Agent. The provisions of Sections 8.01, 8.03
and 8.06 shall apply to the Bank also in its role as Securities Registrar and
Transfer Agent, for so long as the Bank shall act as Securities Registrar and
Transfer Agent.
Upon surrender for registration of transfer of any Capital Securities
Certificate at the office or agency maintained pursuant to Section 5.08, the
Administrative Trustees or any one of them shall execute and shall cause to be
delivered to the Property Trustee, and the Property Trustee shall deliver, in
the name of the designated transferee or transferees, one or more new Capital
Securities Certificates in authorized denominations of a like aggregate
Liquidation Amount dated the date of execution by such Administrative Trustee or
Trustees. The Securities Registrar shall not be required to register the
transfer of any Capital Securities that have been called for redemption. At the
option of a Holder, Capital Securities Certificates may be exchanged for other
Capital Securities Certificates in autho rized denominations and of a like
aggregate Liquidation Amount upon surrender of the Capital Securities
Certificates to be exchanged at the office or agency maintained pursuant to
Section 5.08.
Every Capital Securities Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to an Administrative Trustee and the
Securities Registrar duly executed by the Holder or his attorney duly authorized
in writing. Each Capital Securities Certificate surrendered for registration of
transfer or exchange shall be canceled and subsequently disposed of by the
Securities Registrar, in accordance with its customary practice.
No service charge shall be made for any registration of transfer or exchange
of Capital Securities Certificates, but the Securities Registrar may require
payment (with the giving of such indemnity as the Trust or the Parent may
require) of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer or exchange of Capital Securities
Certificates.
Section 5.05. Mutilated, Destroyed, Lost or Stolen Trust Securities
-----------------------------------------------------
Certificates. If (a) any mutilated Trust Securities Certificate shall be
------------
surrendered to the Securities Regis trar, or if the Securities Registrar shall
receive evidence to its satisfaction of the destruction, loss or theft of any
Trust Securities Certificate and (b) there shall be delivered to the Securities
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees, or any one of them, on behalf of the
Trust shall execute and cause to be made available for delivery, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Trust Securities
Certificate, a new Trust Securities Certificate of
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like class, tenor and denomination. In connection with the issuance of any new
Trust Securities Certificate under this Section, the Administrative Trustees or
the Securities Registrar may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Trust Securities Certificate issued pursuant to this
Section shall constitute conclusive evidence of an undivided beneficial interest
in the assets of the Trust, as if originally issued, whether or not the lost,
stolen or destroyed Trust Securities Certificate shall be found at any time.
Section 5.06. Persons Deemed Securityholders. Prior to due presentation of
------------------------------
a Trust Securities Certificate for registration of transfer, the Administrative
Trustees or the Securities Registrar shall treat the Person in whose name any
Trust Securities Certificate shall be registered in the Securities Register as
the owner of such Trust Securities Certificate for the purpose of receiving
distributions and for all other purposes whatsoever, and neither the Trustees
nor the Securities Registrar shall be bound by any notice to the contrary.
Section 5.07. Access to List of Securityholders' Names and Addresses. The
------------------------------------------------------
duties and responsibilities of the Depositor and any other party to provide any
list of Securityholders shall be as set forth in the Trust Indenture Act,
including Section 312 of such Trust Indenture Act. Each Holder, by receiving
and holding a Trust Securities Certificate, and each Owner shall be deemed to
have agreed not to hold either the Depositor, the Property Trustee, the Trustee
or the Administrative Trustees accountable by reason of the disclosure of its
name and address, regardless of the source from which such information was
derived.
Section 5.08. Maintenance of Office or Agency. The Property Trustee shall
-------------------------------
maintain, with the consent of the Administrative Trustees, an office or offices
or agency or agencies where Capital Securities Certificates may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Trustees in respect of the Trust Securities Certificates may be served.
Such offices or agencies shall consist of (a) the Corporate Trust Office of the
Property Trustee which address is, ▇/▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ (Delaware),
__________________________________________________, Attention: Corporate Trust
Administration, (b) the principal office of any Paying Agent or (c) the
principal office of the Securities Registrar and Transfer Agent. The
Administrative Trustees shall give prompt written notice to the Depositor and to
the Securityholders of any change in the location of the Securities Register or
any such office or agency.
Section 5.09. Appointment of Paying Agent. The Paying Agent shall make
---------------------------
distributions to Securityholders from the Payment Account and shall report the
amounts of such distributions to the Property Trustee and the Administrative
Trustees. Any Paying Agent shall have the revocable power to withdraw funds
from the Payment Account for the purpose of making the distributions referred to
above. The Administrative Trustees may revoke such power and remove the Paying
Agent in their sole discretion. The Paying Agent shall initially be the Bank,
and any co-paying agent chosen by the Bank, and acceptable to the Administrative
Trustees and the Depositor. Any Person acting as Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' written notice to the
Administrative Trustees, the Property Trustee and the Depositor. In the event
that the Bank shall no longer be the Paying Agent or a successor Paying Agent
shall resign or its authority to act be revoked, the Administrative Trustees
shall appoint a successor that is
-22-
acceptable to the Property Trustee and the Depositor to act as Paying Agent
(which shall be a bank or trust company). The Administrative Trustees shall
cause such successor Paying Agent or any additional Paying Agent appointed by
the Administrative Trustees to execute and deliver to the Trustees an instrument
in which such successor Paying Agent or additional Paying Agent shall agree with
the Trustees that as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for payment to the
Securityholders in trust for the benefit of the Securityholders entitled thereto
until such sums shall be paid to such Securityholders. The Paying Agent shall
return all unclaimed funds to the Property Trustee and upon removal of a Paying
Agent such Paying Agent shall also return all funds in its possession to the
Property Trustee. The provisions of Sections 8.01, 8.03 and 8.06 shall apply to
the Bank also in its role as Paying Agent, for so long as the Bank shall act as
Paying Agent and, to the extent applicable, to any other paying agent appointed
hereunder. Any reference in this Agreement to the Paying Agent shall include any
co-paying agent unless the context requires otherwise.
Section 5.10. Ownership of Common Securities by Depositor. On the Closing
-------------------------------------------
Date the Depositor shall acquire and thereafter shall retain beneficial and
record ownership of the Common Securities. Any attempted transfer of the Common
Securities other than as set forth in the preceding sentence shall be void;
provided that any permitted successor of the Depositor under the Indenture may
succeed to the Depositor's ownership of the Common Securities. The
Administrative Trustees shall cause each Common Securities Certificate issued to
the Depositor to contain a legend stating substantially "THIS CERTIFICATE IS NOT
TRANSFERABLE".
Section 5.11. Book-Entry Capital Securities Certificates; Common
--------------------------------------------------
Securities Certificate.
----------------------
(a) The Capital Securities Certificates, upon original issuance, will be
issued in the form of a typewritten Capital Securities Certificate or
Certificates representing Book-Entry Capital Securities Certificates, to be
delivered to The Depository Trust Company, the initial Clearing Agency, by, or
on behalf of, the Trust. Such Capital Securities Certificate or Certificates
shall initially be registered on the Securities Register in the name of Cede &
Co., the nominee of the initial Clearing Agency, and no Book-Entry Capital
Securities Certificate may be exchanged in whole or in part for Capital
Securities Certificates registered, and no transfer of a Book-Entry Capital
Securities Certificate in whole or in part may be registered, in the name of any
Person other than the Clearing Agency for such Book-Entry Capital Securities
Certificates of a nominee thereof, except as provided in Section 5.13. Unless
and until Definitive Capital Securities Certificates have been issued to Owners
pursuant to Section 5.13:
(i) the provisions of this Section 5.11(a) shall be in full force and
effect;
(ii) the Clearing Agency or its nominee, as registered owner of a Book-
Entry Capital Securities Certificate, shall be the Holder of such Book-Entry
Capital Securities Certificate for all purposes under this Trust Agreement and
the Book-Entry Capital Securities Certificate, and Owners with respect to a
Book-Entry Capital Securities Certificate shall hold such interests pursuant to
the Applicable Procedures; the Securities Registrar and the Trustees shall be
entitled to deal with the Clearing Agency for all purposes of this Trust
Agreement relating to the Book-Entry Capital Securities Certificates
-23-
(including the payment of the Liquidation Amount of and Distributions on the
Book-Entry Capital Securities and the giving of instructions or directions to
Owners of Book-Entry Capital Securities) as the sole Holder of the Book-Entry
Capital Securities and shall have no obligations to the Owners thereof;
(iii) to the extent that the provisions of this Section 5.11 conflict with
any other provisions of this Trust Agreement, the provisions of this Section
5.11 shall control;
(iv) the rights of the Owners of the Book-Entry Capital Securities
Certificates shall be exercised only through the Clearing Agency and shall be
limited to those established by law, the Applicable Procedures and agreements
between such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Certificate Depository Agreement, unless and
until Definitive Capital Securities Certificates are issued pursuant to Section
5.13, the initial Clearing Agency will make book-entry transfers among the
Clearing Agency Participants and receive and transmit payments on the Capital
Securities to such Clearing Agency Participants; and
(v) whenever this Trust Agreement requires or permits actions to be taken
based upon instructions or directions of Holders of Trust Certificates
evidencing a specified percentage of the aggregate Liquidation Amount, the
Clearing Agency shall be deemed to represent such percentage only to the extent
that it has received instructions to such effect from Owners and/or Clearing
Agency Participants owning or representing, respectively, such required
percentage of the beneficial interest in the applicable class of Trust
Certificates and has delivered such instructions to the Administrative Trustees.
(b) A single Common Securities Certificate representing the Common
Securities shall be issued to the Depositor in the form of a definitive Common
Securities Certificate.
Section 5.12. Notices to Clearing Agency. To the extent that a notice or
--------------------------
other communication to the Owners is required under this Trust Agreement, unless
and until Definitive Capital Securities Certificates shall have been issued to
Owners pursuant to Section 5.13, the Trustees shall give all such notices and
communications specified herein to be given to the Clearing Agency, and shall
have no obligations to the Owners.
Section 5.13. Definitive Capital Securities Certificates. If (a) the
------------------------------------------
Clearing Agency advises the Trustees, the Securities Registrar and Transfer
Agent and Parent by giving ninety (90) days' prior written notice (provided,
however, that if the Clearing Agency is required to discontinue its services as
depositary with respect to the Capital Securities pursuant to any governmental,
judicial or regulatory order or decree, and such discontinuation is required in
less than 90 days from the date of such order or decree, then the Clearing
Agency may discontinue such services by giving notice to Parent, the Trustees
and the Securities Registrar and Transfer Agent as soon as reasonably possible),
that it is no longer willing or able to properly discharge its responsibilities
with respect to the Capital Securities Certificates, and the Depositor is unable
to locate a qualified successor, (b) the Clearing Agency ceases to be a clearing
agency registered under the Exchange Act, at a time when the Clearing Agency is
required to be so registered to act as such clearing agency, (c) the Trust at
its option advises the Depositary in writing that it elects to terminate the
book-entry system through the Clearing Agency or (d) a Debenture Event of
Default has occurred and is continuing, then the Administrative Trustees shall
notify the
-24-
Clearing Agency and the Clearing Agency shall notify all Owners of Capital
Securities Certificates and the Trustees of the occurrence of any such event and
of the availability of the Definitive Capital Securities Certificates to Owners
of such class or classes, as applicable, requesting the same.
If any Book-Entry Capital Securities Certificate is to be exchanged for
other Capital Securities Certificates or canceled in part, or if any other
Capital Securities Certificate is to be exchanged in whole or in part for Book-
Entry Capital Securities represented by a Book-Entry Capital Securities
Certificate, then either (a) such Book-Entry Capital Securities Certificate
shall be so surrendered for exchange or cancellation as provided in this Article
V or (b) the aggregate Liquidation Amount represented by such Book-Entry Capital
Securities Certificate shall be reduced, subject to Section 5.02, or increased
by an amount equal to the Liquidation Amount represented by that portion of the
Book-Entry Capital Securities Certificate to be so exchanged or canceled, or
equal to the Liquidation Amount represented by such other Capital Securities
Certificates to be so exchanged for Book-Entry Capital Securities represented
thereby, as the case may be, by means of an appropriate adjustment made on the
records of the Securities Registrar, whereupon the Property Trustee, in
accordance with the Applicable Procedures, shall instruct the Clearing Agency or
its authorized representative to make a corresponding adjustment to its records.
Upon surrender to the Administrative Trustees of the typewritten Capital
Securities Certificate or Certificates representing the Book-Entry Capital
Securities Certificates by the Clearing Agency, accompanied by registration
instructions, the Administrative Trustees, or any one of them, shall execute the
Definitive Capital Securities Certificates in accordance with the instructions
of the Clearing Agency. In the event that Capital Securities are issued in
definitive form, such Capital Securities will be in denominations of $1,000 and
integral multiples thereof. Neither the Securities Registrar nor the Trustees
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Capital Securities Certificates, the Trustees
shall recognize the Holders of the Definitive Capital Securities Certificates as
Securityholders. The Definitive Capital Securities Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrative Trustees, as evidenced by the
execution thereof by the Administrative Trustees or any one of them and may have
such letters, numbers or other marks of identification or designation and such
legends or endorsements as the Administrative Trustees may deem appropriate, or
as may be required to comply with any law or rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which Capital
Securities may be listed, or to conform to usage.
Section 5.14. Rights of Securityholders.
-------------------------
(a) The legal title to the Trust Property is vested exclusively in the
Property Trustee (in its capacity as such) in accordance with Section 2.09, and
the Securityholders shall not have any right or title therein other than the
undivided beneficial interest in the assets of the Trust conferred by their
Trust Securities and they shall have no right to call for any partition or
division of property, profits or rights of the Trust except as described below.
The Trust Securities shall be personal property giving only the rights
specifically set forth therein and in this Trust Agreement. The Trust
Securities shall have no preemptive or similar rights and when issued and
delivered to the Securityholders against payment of the purchase price therefor
and upon such payment will be fully paid and nonassessable
-25-
by the Trust. The Holders of the Trust Securities, in their capacities as such,
shall be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.
(b) For so long as any Capital Securities remain Outstanding, if, upon a
Debenture Event of Default, the Debenture Trustee fails or the holders of not
less than 25% in aggregate principal amount of the outstanding Debentures fail
to declare the principal of all of the Debentures to be immediately due and
payable, the Holders of at least 25% in Liquidation Amount of the Capital
Securities then Outstanding shall have such right by a notice in writing to the
Depositor and the Debenture Trustee; and upon any such declaration such
principal amount of and the accrued interest on all of the Debentures shall
become immediately due and payable, provided that the payment of principal and
interest on such Debentures remains subordinated to the extent provided in the
Indenture.
At any time after such a declaration of acceleration with respect to the
Debentures has been made and before a judgment or decree for payment of the
money due has been obtained by the Debenture Trustee as in the Indenture
provided, if the holders of a majority in aggregate principal amount of the
outstanding Debentures fail to annul any such declaration and waive such
default, the Holders of a majority in Liquidation Amount of the Capital
Securities, by written notice to the Depositor and the Debenture Trustee, may
rescind and annul such declaration and its consequences if:
(i) the Depositor has paid or deposited with the Debenture Trustee a sum
sufficient to pay:
(A) all overdue installments of interest (including any Additional
Interest as defined in the Indenture) on all of the Debentures,
(B) the principal of (and premium, if any, on) any Debenture which have
become due otherwise than by such declaration of acceleration and interest
thereon at the rate borne by the Debentures, and
(C) all sums paid or advanced by the Debenture Trustee under the
Indenture and the reasonable compensation, expenses, disbursements and advances
of the Debenture Trustee and the Property Trustee, their agents and counsel; and
(ii) all Debenture Events of Default, other than the non-payment of the
principal of the Debentures which has become due solely by such acceleration,
have been cured or waived as provided in Section 513 of the Indenture.
The holders of a majority in aggregate Liquidation Amount of the Capital
Securities may, on behalf of the Holders of all the Capital Securities, waive
any past default under the Indenture, except a default in the payment of
principal of (or premium, if any) or interest (including any Additional
Interest, as defined in the Indenture) on any Debenture (unless such default has
been cured and a sum sufficient to pay all matured installments of interest
(including any Additional Interest, as defined in the Indenture) and principal
due otherwise than by acceleration (and premium, if any) has been deposited with
the Debenture Trustee) or a default in respect of a covenant or provision which
under the
-26-
Indenture cannot be modified or amended without the consent of the holder of
each outstanding Debenture. No such rescissions shall affect any subsequent
default or impair any right consequent thereon.
Upon receipt by the Property Trustee of written notice declaring such an
acceleration, or rescission and annulment thereof, by Holders of the Capital
Securities all or part of which are represented by Book-Entry Capital Securities
Certificates, a record date shall be established for determining Holders of
Outstanding Capital Securities entitled to join in such notice, which record
date shall be at the close of business on the day the Property Trustee receives
such notice. The Holders on such record date, or their duly designated proxies,
and only such Persons, shall be entitled to join in such notice, whether or not
such Holders remain Holders after such record date; provided, that, unless such
declaration of acceleration, or rescission and annulment, as the case may be,
shall have become effective by virtue of the requisite percentage having joined
in such notice prior to the day which is 90 days after such record date, such
notice of declaration or acceleration, or rescission and annulment, as the case
may be, shall automatically and without further action by any Holder be canceled
and of no further effect. Nothing in this paragraph shall prevent a Holder, or
a proxy of a Holder, from giving, after expiration of such 90-day period, a new
written notice of declaration of acceleration, or rescission and annulment
thereof, as the case may be, that is identical to a written notice which has
been canceled pursuant to the proviso to the preceding sentence, in which event
a new record date shall be established pursuant to the provisions of this
Section 5.14(b).
(c) For so long as any Capital Securities remain outstanding, to the fullest
extent permitted by law and subject to the terms of this Trust Agreement and the
Indenture, upon a Debenture Event of Default specified in Section 501(a) or
501(b) of the Indenture, any Holder of Capital Securities shall have the right
to institute a proceeding directly against the Depositor, pursuant to Section
508 of the Indenture, for enforcement of payment to such Holder of the principal
amount of (and premium, if any) or interest (including any Additional Interest,
as defined in the Indenture) on the Debentures having a principal amount equal
to the aggregate Liquidation Amount of the Capital Securities of such Holder (a
"Direct Action"). Except as set forth in Section 5.14(b) and (c), the Holders
of Capital Securities shall have no right to exercise directly any right or
remedy available to the holders of, or in respect of, the Debentures.
(d) Except as otherwise provided in paragraphs (a), (b) and (c) of this
Section 5.14, the Holders of at least a Majority in Liquidation Amount of the
Capital Securities may, on behalf of the Holders of all the Capital Securities,
waive any past default or Event of Default and its consequences. Upon such
waiver, any such default or Event of Default shall cease to exist, and any
default or Event of Default arising therefrom shall be deemed to have been
cured, for every purpose of this Trust Agreement, but no such waiver shall
extend to any subsequent or other default or Event of Default or impair any
right consequent thereon.
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ARTICLE VI
Acts of Securityholders; Meetings; Voting
Section 6.01. Limitations on Voting Rights.
----------------------------
(a) Except as provided in this Section, in Section 10.03 and in the
Indenture and as otherwise required by law, no Holder of Capital Securities
shall have any right to vote or in any manner otherwise control the
administration, operation and management of the Trust or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Trust Securities Certificates, be construed so as to constitute the
Securityholders from time to time as partners or members of an association.
(b) So long as any Debentures are held by the Property Trustee, the
Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on the Debenture Trustee with respect to such
Debentures, (ii) waive any past default which is waivable under Section 513 of
the Indenture, (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable or (iv) consent to
any amendment, modification or termination of the Indenture or the Debentures,
where such consent shall be required, without, in each case, obtaining the prior
approval of the Holders of at least a majority in Liquidation Amount of the
Outstanding Capital Securities; provided, however, that where a consent under
the Indenture would require the consent of each holder of Debentures affected
thereby, no such consent shall be given by the Property Trustee without the
prior written consent of each Holder of Capital Securities. The Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of Capital Securities, except by a subsequent vote of the Holders of Capital
Securities. The Property Trustee shall notify all Holders of the Capital
Securities of any notice of default received from the Debenture Trustee. In
addition to obtaining the foregoing approvals of the Holders of the Capital
Securities, prior to taking any of the foregoing actions, the Trustees shall, at
the expense of the Depositor, obtain an Opinion of Counsel experienced in such
matters to the effect that such action shall not cause the Trust to be taxable
as a corporation or classified as other than a grantor trust for United States
federal income tax purposes on account of such action.
(c) Except as provided in Section 10.03, if any proposed amendment to the
Trust Agreement provides for, or the Trustees otherwise propose to effect, (i)
any action that would adversely affect in any material respect the powers,
preferences or special rights of the Capital Securities, whether by way of
amendment to the Trust Agreement or otherwise, or (ii) the dissolution, winding-
up or termination of the Trust, other than pursuant to the terms of this Trust
Agreement, then the Holders of Outstanding Capital Securities as a class will be
entitled to vote on such amendment or proposal and such amendment or proposal
shall not be effective except with the approval of the Holders of at least a
majority in Liquidation Amount of the Outstanding Capital Securities. No
amendment to this Trust Agreement may be made if, as a result of such amendment,
it would cause the trust to be taxable as a corporation or classified as other
than a grantor trust for United States federal income tax purposes or would lose
its exemption from status as an "investment company" under the Investment
Company Act.
-28-
Section 6.02. Notice of Meetings. Notice of all meetings of the Capital
------------------
Securityholders, stating the time, place and purpose of the meeting, shall be
given by the Administrative Trustees pursuant to Section 10.09 to each Capital
Securityholder of record, at his registered address, at least 15 days and not
more than 90 days before the meeting. At any such meeting, any business properly
before the meeting may be so considered whether or not stated in the notice of
the meeting. Any adjourned meeting may be held as adjourned without further
notice.
Any and all notices to which any Capital Securityholder hereunder may be
entitled and any and all communications shall be deemed duly served or given if
mailed, postage prepaid, addressed to any Capital Securityholder of record at
his last known address as recorded on the Securities Register.
Section 6.03. Meetings of Capital Securityholders. No annual meeting of
-----------------------------------
Securityholders is required to be held. The Administrative Trustees, however,
shall call a meeting of Securityholders to vote on any matter upon the written
request of the Capital Securityholders of record of at least 25% in aggregate
Liquidation Amount of the Outstanding Capital Securities and the Administrative
Trustees or the Property Trustee may, at any time in their discretion, call a
meeting of Capital Securityholders to vote on any matters as to the which
Capital Securityholders are entitled to vote.
Capital Securityholders of record of at least 50% in aggregate Liquidation
Amount of the Outstanding Capital Securities present in person or by proxy,
shall constitute a quorum at any meeting of Securityholders.
If a quorum is present at a meeting, an affirmative vote by the Capital
Securityholders of record present, in person or by proxy, holding at least a
majority in aggregate Liquidation Amount of the Capital Securities held by the
Capital Securityholders of record present, either in person or by proxy, at such
meeting shall constitute the action of the Securityholders, unless this Trust
Agreement requires a greater number of affirmative votes.
Section 6.04. Voting Rights. Securityholders shall be entitled to one
-------------
vote for each $1,000 of Liquidation Amount represented by their Trust Securities
in respect of any matter as to which such Securityholders are entitled to vote.
Section 6.05. Proxies, etc. At any meeting of Securityholders, any
-------------
Securityholder entitled to vote thereat may vote by proxy, provided that no
proxy shall be voted at any meeting unless it shall have been placed on file
with the Administrative Trustees, or with such other officer or agent of the
Trust as the Administrative Trustees may direct, for verification prior to the
time at which such vote shall be taken. Pursuant to a resolution of the
Property Trustee, proxies may be solicited in the name of the Property Trustee
or one or more officers of the Property Trustee. Only Securityholders of record
shall be entitled to vote. When Trust Securities are held jointly by several
persons, any one of them may vote at any meeting in person or by proxy in
respect of such Trust Securities, but if more than one of them shall be present
at such meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in
respect of such Trust Securities. A proxy purporting to be executed by or on
behalf of a Securityholder shall be deemed valid unless challenged at or prior
to its
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exercise, and the burden of proving invalidity shall rest on the challenger. No
proxy shall be valid more than three years after its date of execution.
Section 6.06. Securityholder Action by Written Consent. Any action which
----------------------------------------
may be taken by Securityholders at a meeting may be taken without a meeting if
Securityholders holding at least a majority in aggregate Liquidation Amount of
all Outstanding Trust Securities entitled to vote in respect of such action (or
such larger proportion thereof as shall be required by any express provision of
this Trust Agreement) shall consent to the action in writing. The
Administrative Trustees shall cause a notice of any matter upon which action by
written consent of the Securityholders is to be taken, to be given to each
Holder of record of the Outstanding Capital Securities in the same manner as
that set forth in Section 6.02 for notice of meetings.
Section 6.07. Record Date for Voting and Other Purposes. For the purposes
-----------------------------------------
of determining the Securityholders who are entitled to notice of and to vote at
any meeting or by written consent, or to participate in any Distribution on the
Trust Securities in respect of which a record date is not otherwise provided for
in this Trust Agreement, or for the purpose of any other action, the
Administrative Trustees or the Property Trustee may from time to time fix a
date, not more than 90 days prior to the date of any meeting of Securityholders
or the payment of Distribution or other action, as the case may be, as a record
date for the determination of the identity of the Securityholders of record for
such purposes.
Section 6.08. Acts of Securityholders. Any request, demand,
-----------------------
authorization, direction, notice, consent, waiver or other action provided or
permitted by this Trust Agreement to be given, made or taken by Securityholders
or Owners may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Securityholders or Owners in person
or by an agent duly appointed in writing; and, except as otherwise expressly
provided herein, such action shall become effective when such instrument or
instruments are delivered to an Administrative Trustee. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Securityholders or Owners signing such
instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this
Trust Agreement and (subject to Section 8.01) conclusive in favor of the
Trustees, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is
by a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.
The ownership of Trust Securities shall be proved by the Securities
Register.
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Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to take
any action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise between the Securityholders of Trust Securities
and the Administrative Trustees or among such Securityholders or Trustees with
respect to the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder or
Trustee under this Article VI, then the determination of such matter by the
Property Trustee shall be conclusive with respect to such matter.
A Securityholder may institute a legal proceeding directly against the
Depositor under the Guarantee to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee (as defined
in the Guarantee), the Trust or any person or entity.
Section 6.09. Inspection of Records. Upon reasonable notice to the
---------------------
Administrative Trustees and the Property Trustee, the records of the Trust shall
be open to inspection by Securityholders during normal business hours for any
purpose reasonably related to such Securityholder's interest as a
Securityholder.
ARTICLE VII
Representations and Warranties
Section 7.01. Representations and Warranties of the Bank, the Property
--------------------------------------------------------
Trustee and the Trustee. The Bank, the Property Trustee and the Trustee, each
-----------------------
severally on behalf of and as to itself, hereby represents and warrants as to
itself only and for the benefit of the Depositor and the Securityholders that:
(a) the Bank is a banking corporation duly organized, validly existing and
in good standing under the laws of the State of New York;
(b) the Bank has full corporate power, authority and legal right to
execute, deliver and perform its obligations under this Trust Agreement and has
taken all necessary action to authorize the execution, delivery and performance
by it of this Trust Agreement;
(c) the Trustee is a Delaware banking corporation;
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(d) the Trustee has full corporate power, authority and legal right to
execute, deliver and perform its obligations under this Trust Agreement and has
taken all necessary action to authorize the execution, delivery and performance
by it of this Trust Agreement.
(e) this Trust Agreement has been duly authorized, executed and delivered
by the Bank and the Trustee and constitutes the valid and legally binding
agreement each of the Bank and the Trustee enforceable against each of them in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles;
(f) the execution, delivery and performance by the Bank of this Trust
Agreement have been duly authorized by all necessary corporate and other action
on the part of the Bank, the Trustee and the Property Trustee, and do not
require any approval of stockholders of the Bank or the Trustee and such
execution, delivery and performance will not (i) violate the Charter or By-laws
of the Bank or the Trustee, (ii) violate any provision of, or constitute, with
or without notice or lapse of time, a default under, or result in the creation
or imposition of, any Lien on any properties included in the Trust Property
pursuant to the provisions of, any indenture, mortgage, credit agreement,
license or other agreement or instrument to which the Bank, the Property Trustee
or the Trustee is a party or by which it is bound or (iii) violate any law,
governmental rule or regulation of the State of New York, the State of Delaware
or the United States governing the banking or trust powers of the Bank, the
Trustee and the Property Trustee or any order, judgment or decree applicable to
the Bank, the Property Trustee or the Trustee;
(g) neither the authorization, execution or delivery by the Bank or the
Trustee of this Trust Agreement nor the consummation of any of the transactions
by the Bank, the Trustee or the Property Trustee contemplated herein or therein
require the consent or approval of, the giving of notice to, the registration
with or the taking of any other action with respect to any governmental
authority or agency under any existing federal law governing the banking or
trust powers of the Bank or under the laws of the United States, the State of
Delaware or the State of New York;
(h) there are no proceedings pending or, to the best of each of the Bank's
and the Trustee's knowledge, threatened against or affecting the Bank, the
Trustee or the Property Trustee in any court or before any governmental
authority, agency or arbitration board or tribunal which, individually or in the
aggregate, would materially and adversely affect the Trust or would question the
right, power and authority of the Bank or the Trustee, as the case may be, to
enter into or perform its obligations as one of the Trustees under this Trust
Agreement; and
(i) the principal place of business of the Trustee is located in the State
of Delaware.
Section 7.02. Representations and Warranties of Parent. The Parent
----------------------------------------
hereby represents and warrants for the benefit of the Securityholders that:
(a) this Trust Agreement has been duly authorized, executed and delivered
by Parent and constitutes the valid and legally binding agreement of Parent
enforceable against Parent in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent
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transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles;
(b) the Trust Securities Certificates issued on the Closing Date on behalf
of the Trust have been duly authorized and will have been, as of each such date,
duly and validly executed, issued and delivered by the Trustees pursuant to the
terms and provisions of, and in accordance with the requirements of, this Trust
Agreement and the Securityholders will be, as of such date, entitled to the
benefits of this Trust Agreement; and
(c) there are no taxes, fees or other governmental charges payable by the
Trust (or the Trustees on behalf of the Trust) under the laws of the State of
Delaware or any political subdivision thereof in connection with the execution,
delivery and performance by the Bank or the Property Trustee, as the case may
be, of this Trust Agreement.
ARTICLE VIII
The Trustees
Section 8.01. Certain Duties and Responsibilities.
-----------------------------------
(a) The duties and responsibilities of the Trustees shall be as provided by
this Trust Agreement and, in the case of the Property Trustee, by the Trust
Indenture Act. Notwithstanding the foregoing, no provision of this Trust
Agreement shall require the Trustees to expend or risk their own funds or
otherwise incur any financial liability in the performance of any of their
duties hereunder, or in the exercise of any of their rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it. Whether or not therein expressly so provided, every provision of this Trust
Agreement relating to the conduct or affecting the liability of or affording
protection to the Trustees shall be subject to the provisions of this Section.
Nothing in this Trust Agreement shall be construed to release an Administrative
Trustee from liability for such Person's own negligent action, such Person's own
negligent failure to act or such Person's own willful misconduct. To the extent
that, at law or in equity, any Trustee has duties and liabilities relating to
the Trust or to the Holders, such Trustee shall not be liable to the Trust or to
any Holder for such Trustee's good faith reliance on the provisions of this
Trust Agreement. The provisions of this Trust Agreement, to the extent that
they restrict the duties and liabilities of the Trustees otherwise existing at
law or in equity, are agreed by the Depositor and the Holders to replace such
other duties and liabilities of the Trustees.
(b) All payments made by the Property Trustee or a Paying Agent in respect
of the Trust Securities shall be made only from the revenue and proceeds from
the Trust Property and only to the extent that there shall be sufficient revenue
or proceeds from the Trust Property to enable the Property Trustee or a Paying
Agent to make payments in accordance with the terms hereof. Each
Securityholder, by its acceptance of a Trust Security, agrees that it will look
solely to the revenue and proceeds from the Trust Property to the extent legally
available for distribution to it as herein provided and that
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the Trustees are not personally liable to it for any amount distributable in
respect of any Trust Security or for any other liability in respect of any Trust
Security. This Section 8.01(b) does not limit the liability of the Trustees
expressly set forth elsewhere in this Trust Agreement or, in the case of the
Property Trustee, in the Trust Indenture Act.
(c) The Property Trustee, before the occurrence of any Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Trust Agreement and no implied covenants shall be read into this Trust Agreement
against the Property Trustee. In case an Event of Default has occurred (that
has not been cured or waived), the Property Trustee shall exercise such of the
rights and powers vested in it by this Trust 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 own affairs.
(d) No provision of this Trust Agreement shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct, except that:
(i) the Property Trustee shall not be liable for any error of judgment
made in good faith by an authorized officer of the Property Trustee, unless it
shall be proved that the Property Trustee was negligent in ascertaining the
pertinent facts;
(ii) the Property Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of not less than a majority in Liquidation Amount of
the Capital Securities relating to the time, method and place of conducting any
proceeding for any remedy available to the Property Trustee, or exercising any
trust or power conferred upon the Property Trustee under this Trust Agreement;
(iii) the Property Trustee's sole duty with respect to the custody, safe
keeping and physical preservation of the Debentures and the Payment Account
shall be to deal with such property in a similar manner as the Property Trustee
deals with similar property for its own account, subject to the protections and
limitations on liability afforded to the Property Trustee under this Trust
Agreement and the Trust Indenture Act;
(iv) the Property Trustee shall not be liable for any interest on any
money received by it except as it may otherwise agree with the Depositor. Money
held by the Property Trustee need not be segregated from other funds held by it
except in relation to the Payment Account maintained by the Property Trustee
pursuant to Section 3.01 and except to the extent otherwise required by law; and
(v) the Property Trustee shall not be responsible for monitoring the
compliance by the Administrative Trustees or the Depositor with their respective
duties under this Trust Agreement, nor shall the Property Trustee be liable for
the default or misconduct of the Administrative Trustees or the Depositor.
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Section 8.02. Certain Notices.
---------------
Within five Business Days after the occurrence of any Event of Default, the
Property Trustee shall transmit, in the manner and to the extent provided in
Section 10.09, notice of any Event of Default actually known to the Property
Trustee to the Securityholders, the Administrative Trustees and the Depositor,
unless such Event of Default shall have been cured or waived.
Within five Business Days after the receipt of notice of the Depositor's
exercise of its right to defer the payment of interest on the Debentures
pursuant to the Indenture, the Administrative Trustees shall transmit, in the
manner and to the extent provided in Section 10.09, notice of such exercise to
the Securityholders and the Property Trustee, unless such exercise shall have
been revoked.
Section 8.03. Certain Rights of Property Trustee. Subject to the
----------------------------------
provisions of Section 8.01 and except as provided by law:
(a) the Property Trustee may rely and shall be protected in acting or
refraining from acting in good faith upon any resolution, Opinion of Counsel,
certificate, written representation of a Holder or transferee, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) if (i) in performing its duties under this Trust Agreement the Property
Trustee is required to decide between alternative courses of action or (ii) in
construing any of the provisions in this Trust Agreement the Property Trustee
finds the same ambiguous or inconsistent with any other provisions contained
herein or (iii) the Property Trustee is unsure of the application of any
provision of this Trust Agreement, then, except as to any matter as to which the
Capital Securityholders are entitled to vote under the terms of this Trust
Agreement, the Property Trustee shall deliver a notice to the Depositor
requesting written instructions of the Depositor as to the course of action to
be taken. The Property Trustee shall take such action, or refrain from taking
such action, as the Property Trustee shall be instructed in writing to take, or
to refrain from taking, by the Depositor; provided, however, that if the
Property Trustee does not receive such instructions of the Depositor within ten
Business Days after it has delivered such notice, or such reasonably shorter
period of time set forth in such notice (which to the extent practicable shall
not be less than two Business Days), it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Trust Agreement as
it shall deem advisable and in the best interests of the Securityholders, in
which event the Property Trustee shall have no liability except for its own bad
faith, negligence or willful misconduct;
(c) any direction or act of the Depositor or the Administrative Trustees
contemplated by this Trust Agreement shall be sufficiently evidenced by an
Officer's Certificate;
(d) whenever in the administration of this Trust Agreement, the Property
Trustee shall deem it desirable that a matter be established before undertaking,
suffering or
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omitting any action hereunder, the Property Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its part,
request and rely upon an Officer's Certificate which, upon receipt of such
request, shall be promptly delivered by the Depositor or the Administrative
Trustees;
(e) the Property Trustee shall have no duty to see to any recording, filing
or registration of any instrument (including any financing or continuation
statement or any filing under tax or securities laws) or any rerecording,
refiling or reregistration thereof;
(f) the Property Trustee may (at the expense of the Depositor) consult with
counsel (which counsel may be counsel to the Depositor or any of its Affiliates,
and may include any of its employees) and the written advice of such counsel
shall be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon; the Property Trustee shall have the right at any time to seek
instructions concerning the administration of this Trust Agreement from any
court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Trust Agreement at the request or
direction of any of the Securityholders pursuant to this Trust Agreement, unless
such Securityholders shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(h) the Property Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond,
debenture, note or other evidence of indebtedness or other paper or document,
unless requested in writing to do so by one or more Securityholders, but the
Property Trustee may make such further inquiry or investigation into such facts
or matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through its agents or
attorneys, provided that the Property Trustee shall be responsible for its own
negligence or misconduct with respect to selection of any agent or attorney
appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement the Property
Trustee shall deem it desirable to receive 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 Trust Securities
which instructions may only be given by the Holders of the same proportion in
Liquidation Amount of the Trust Securities as would be entitled to direct the
Property Trustee under the terms of the Trust Securities in respect of such
remedy, right or action, (ii) may refrain from enforcing such remedy or right or
taking such other action until such instructions are received and (iii) shall be
protected in acting in accordance with such instructions; and
(k) except as otherwise expressly provided by this Trust Agreement, the
Property Trustee shall not be under any obligation to take any action that is
discretionary under the provisions of this Trust Agreement.
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No provision of this Trust Agreement shall be deemed to impose any duty or
obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
Section 8.04. Not Responsible for Recitals or Issuance of Securities. The
------------------------------------------------------
recitals contained herein and in the Trust Securities Certificates shall be
taken as the statements of the Trust and the Depositor, and the Trustees do not
assume any responsibility for their correctness. The Trustees shall not be
accountable for the use or application by the Depositor of the proceeds of the
Debentures.
Section 8.05. May Hold Securities. Except as provided in the definition
-------------------
of the term "Outstanding" in Article I, any Trustee or any other agent of any
Trustee or the Trust, in its individual or any other capacity, may become the
owner or pledgee of Trust Securities and, subject to Sections 8.8 and 8.13, may
otherwise deal with the Trust with the same rights it would have if it were not
a Trustee or such other agent.
Section 8.06. Compensation; Indemnity; Fees.
-----------------------------
The Trust shall:
(a) pay to the Trustees from time to time reasonable compensation for all
services rendered by them hereunder and in the case of the Property Trustee,
such compensation as is separately agreed by the Depositor and the Property
Trustee (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) except as otherwise expressly provided herein, 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.
The Depositor agrees to indemnify each of the Trustees or any predecessor
Trustee for, and to hold the Trustees harmless against, any loss, damage,
claims, liability, tax, penalty or expense of any kind and nature whatsoever
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of this Trust Agreement,
including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder. The provisions of this Section 8.06 shall survive the
termination of this Trust Agreement. No Trustee or Paying Agent may claim any
lien on any Trust Property as a result of any amount due pursuant to this
Section 8.06.
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Section 8.07. Corporate Property Trustee Required; Eligibility of
---------------------------------------------------
Trustees.
(a) There shall at all times be a Property Trustee hereunder with respect
to the Trust Securities. The Property Trustee shall be a Person that is a
national or state chartered bank and eligible pursuant to the Trust Indenture
Act to act as such and has a combined capital and surplus of at least
$50,000,000. If any such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of its supervising or examining
authority, then for the purposes of this Section and to the extent permitted by
the Trust Indenture Act, the combined capital and surplus of such Person shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Property Trustee with
respect to the Trust Securities shall cease to be eligible in accordance with
the provisions of this Section, it shall resign immediately in the manner and
with the effect hereinafter specified in this Article.
(b) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized to bind that
entity.
(c) There shall at all times be a Trustee with respect to the Trust
Securities that shall either be (i) a natural person who is at least 21 years of
age and a resident of the State of Delaware or (ii) a legal entity with its
principal place of business in the State of Delaware and that otherwise meets
the requirements of applicable Delaware law that shall act through one or more
persons authorized to bind such entity.
Section 8.08. Conflicting Interests.
---------------------
(a) If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement.
(b) The Guarantee Agreement and the Indenture shall be deemed to be
specifically described in this Trust Agreement for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture Act.
Section 8.09. Co-Trustees and Separate Trustee. Unless an Event of
--------------------------------
Default shall have occurred and be continuing, at any time or times, for the
purpose of meeting the legal requirements of the Trust Indenture Act or of any
jurisdiction in which any part of the Trust Property may at the time be located,
the Depositor and the Administrative Trustees, by agreed action of the majority
of such Trustees, shall have power to appoint, and upon the written request of
the Administrative Trustees, the Depositor shall for such purpose join with the
Administrative Trustees in the execution, delivery and performance of all
instruments and agreements necessary or proper to appoint one or more Persons
approved by the Property Trustee either to act as co-trustee, jointly with the
Property Trustee, of all or any part of such Trust Property, or to the extent
required by law, to act as separate trustee of any such property, in either case
with such powers as may be provided in the instrument of appointment, and to
vest in such Person or
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Persons in the capacity aforesaid, any property, title, right or power deemed
necessary or desirable, subject to the other provisions of this Trust Agreement.
If the Depositor does not join in such appointment within 15 days after the
receipt by it of a request so to do, or in case a Debenture Event of Default has
occurred and is continuing, the Property Trustee alone shall also have the power
to make such appointment. Any co-trustee or separate trustee appointed pursuant
to this Section shall satisfy the requirements of Section 8.07.
Should any written instrument from the Depositor be required by any co-
trustee or separate trustee so appointed for more fully confirming to such co-
trustee or separate trustee such property, title, right or power, any and all
such instruments shall, on request, be executed, acknowledged and delivered by
the Depositor.
Every co-trustee or separate trustee shall, to the extent permitted by law,
but to such extent only, be appointed subject to the following terms, namely:
(a) The Trust Securities shall be executed by one or more Administrative
Trustees, and the Trust Securities shall be delivered by the Property Trustee,
and all rights, powers, duties and obligations hereunder in respect of the
custody of securities, cash and other personal property held by, or required to
be deposited or pledged with, the Trustees specified hereunder, shall be
exercised solely by such Trustees and not by such co-trustee or separate
trustee.
(b) The rights, powers, duties, and obligations hereby conferred or imposed
upon the Property Trustee in respect of any property covered by such appointment
shall be conferred or imposed upon and exercised or performed by the Property
Trustee or by the Property Trustee and such co-trustee or separate trustee
jointly, as shall be provided in the instrument appointing such co-trustee or
separate trustee, except to the extent that under any law of any jurisdiction in
which any particular act is to be performed, the Property Trustee shall be
incompetent or unqualified to perform such act, in which event such rights,
powers, duties and obligations shall be exercised and performed by such co-
trustee or separate trustee.
(c) The Property Trustee at any time, by an instrument in writing executed
by it, with the written concurrence of the Depositor, may accept the resignation
of or remove any co-trustee or separate trustee appointed under this Section,
and, in case a Debenture Event of Default has occurred and is continuing, the
Property Trustee shall have power to accept the resignation of, or remove, any
such co-trustee or separate trustee without the concurrence of the Depositor.
Upon the written request of the Property Trustee, the Depositor shall join with
the Property Trustee in the execution, delivery and performance of all
instruments and agreements necessary or proper to effectuate such resignation or
removal. A successor to any co-trustee or separate trustee so resigned or
removed may be appointed in the manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be personally liable
by reason of any act or omission of the Property Trustee or any other trustee
hereunder.
(e) The Property Trustee shall not be liable by reason of any act of a co-
trustee or separate trustee.
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(f) Any Act of Holders delivered to the Property Trustee shall be deemed to
have been delivered to each such co-trustee and separate trustee.
Section 8.10. Resignation and Removal; Appointment of Successor. No
-------------------------------------------------
resignation or removal of any Trustee (the "Relevant Trustee") and no
appointment of a successor Relevant Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the successor Relevant
Trustee in accordance with the applicable requirements of Section 8.11.
Subject to the immediately preceding paragraph, the Relevant Trustee may
resign at any time with respect to the Trust Securities by giving written notice
thereof to the Securityholders. If the instrument of acceptance by a successor
Relevant Trustee required by Section 8.11 shall not have been delivered to the
Relevant Trustee within 30 days after the giving of such notice of resignation,
the resigning Relevant Trustee may petition, at the expense of the Trust, any
court of competent jurisdiction for the appointment of a successor Relevant
Trustee with respect to the Trust Securities.
Subject to the following sentence, any of the Trustees may be removed at any
time by Act of the Common Securityholder. The Holders of at least a Majority in
Liquidation Amount of the Outstanding Securities may remove the Property Trustee
or the Trustee, or both of them, for cause, or if a Debenture Event of Default
shall have occurred and be continuing, the Property Trustee or the Trustee, as
the case may be, may be removed at such time by Act of the Holders of a Majority
in Liquidation Amount of the Outstanding Capital Securities with or without
cause, delivered to the Property Trustee (in its individual capacity and on
behalf of the Trust). An Administrative Trustee may be removed by the Common
Securityholder at any time.
If the Relevant Trustee shall resign, be removed or become incapable of
continuing to act as Relevant Trustee, or if a vacancy shall occur in the office
of any Trustee for any cause, at a time when no Debenture Event of Default shall
have occurred and be continuing, the Common Securityholder, by Act of the Common
Securityholder delivered to the retiring Relevant Trustee, shall promptly
appoint a successor Relevant Trustee or Trustees with respect to the Trust
Securities and the Trust, and the retiring Relevant Trustee shall comply with
the applicable requirements of Sec tion 8.11. If the Property Trustee shall
resign, be removed or become incapable of continuing to act as the Property
Trustee at a time when a Debenture Event of Default shall have occurred and be
continuing, the Capital Securityholders, by Act of the Securityholders of a
majority in Liquidation Amount of the Capital Securities then Out standing
delivered to the retiring Relevant Trustee, shall promptly appoint a successor
Relevant Trustee or Trustees with respect to the Trust Securities and the Trust,
and such successor Trustee shall comply with the applicable requirements of
Section 8.11. If an Administrative Trustee shall resign, be removed or become
incapable of continuing to act as Administrative Trustee at a time when a
Debenture Event of Default shall have occurred and be continuing, the Common
Securityholder may appoint a successor Administrative Trustee, which successor
Trustee shall comply with the applicable requirements of Section 8.11 or the
Common Securityholder may reduce the number of Administrative Trustees pursuant
to Section 8.17(a). If no successor Relevant Trustee with respect to the Trust
Securities shall have been so appointed by the Common Securityholder or the
Capital Securityholders and accepted appointment in the manner
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required by Section 8.11, any Securityholder who has been a Securityholder of
Trust Securities for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Relevant Trustee with respect to the Trust
Securities.
The Property Trustee shall give notice of each resignation and each removal
of the Property Trustee with respect to the Trust Securities and the Trust and
each appointment of a successor Property Trustee with respect to the Trust
Securities and the Trust to all Securityholders in the manner provided in
Section 10.09 and shall give notice to the Depositor. Each notice shall include
the name of the successor Property Trustee with respect to the Trust Securities
and the Trust and the address of its Corporate Trust Office.
Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee, a Trustee or a Property
Trustee who is a natural person dies or becomes incompetent or incapacitated,
the vacancy created by such death, incompetence or incapacity may be filled by
(a) the unanimous act of the remaining Administrative Trustees if there are at
least two of them prior to such vacancy or (b) otherwise by the Depositor (with
the successor in each case being an individual who satisfies the eligibility
requirement for Administrative Trustees set forth in Section 8.07).
Additionally, notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event the Depositor believes that any Administrative Trustee
or a Property Trustee who is a natural person, as the case may be, has become
incompetent or incapacitated, the Depositor, by notice to the remaining
Trustees, may terminate the status of such Person as an Administrative Trustee
or a Property Trustee, as the case may be (in which case the vacancy so created
will be filled in accordance with the preceding sentence).
Section 8.11. Acceptance of Appointment by Successor. In case of the
--------------------------------------
appointment hereunder of a successor Relevant Trustee with respect to the Trust
Securities and the Trust, every such successor Relevant Trustee so appointed
shall execute, acknowledge and deliver to the Trust and to the retiring Relevant
Trustee an instrument accepting such appointment, and thereupon the resignation
or removal of the retiring Relevant Trustee shall become effective and such
successor Relevant Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Relevant Trustee; but, on the request of the Depositor or the successor Relevant
Trustee, such retiring Relevant Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Relevant
Trustee all the rights, powers and trusts of the retiring Relevant Trustee and
shall duly assign, transfer and deliver to such successor Relevant Trustee all
property and money held by such retiring Relevant Trustee hereunder.
In case of the appointment hereunder of a successor Relevant Trustee with
respect to the Trust Securities and the Trust, the retiring Relevant Trustee and
each successor Relevant Trustee with respect to the Trust Securities shall
execute and deliver an amendment hereto wherein each successor Relevant Trustee
shall accept such appointment and which (a) shall contain such provisions as
shall be necessary or desirable to transfer and confirm to, and to vest in, each
successor Relevant Trustee all the rights, powers, trusts and duties of the
retiring Relevant Trustee with respect to the
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Trust Securities and the Trust and (b) shall add to or change any of the
provisions of this Trust Agreement as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one Relevant
Trustee, it being understood that nothing herein or in such amendment shall
constitute such Relevant Trustees co-trustees of the same trust and that each
such Relevant Trustee shall be trustee of a trust or trusts hereunder separate
and apart from any trust or trusts hereunder administered by any other such
Relevant Trustee and upon the execution and delivery of such amendment the
resignation or removal of the retiring Relevant Trustee shall become effective
to the extent provided therein and each such successor Relevant Trustee, without
any further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Relevant Trustee with respect to the
Trust Securities and the Trust; but, on request of the Trust or any successor
Relevant Trustee, such retiring Relevant Trustee shall duly assign, transfer and
deliver to such successor Relevant Trustee all Trust Property, all proceeds
thereof and money held by such retiring Relevant Trustee hereunder with respect
to the Trust Securities and the Trust.
Upon request of any such successor Relevant Trustee, the Trust shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Relevant Trustee all such rights, powers and trusts referred
to in the first or second preceding paragraph, as the case may be.
No successor Relevant Trustee shall accept its appointment unless at the
time of such acceptance such successor Relevant Trustee shall be qualified and
eligible under this Article.
Section 8.12. Merger, Conversion, Consolidation or Succession to Business
-----------------------------------------------------------
of a Trustee. Any Person into which the Property Trustee, Trustee or any
------------
Administrative Trustee which is not a natural person may be merged or converted
or with which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which such Relevant Trustee shall be a party, or
any Person succeeding to all or substantially all the corporate trust business
of any such Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder, provided such Person shall be otherwise qualified and eligible under
this Article, without the execution or filing of any paper or any further act on
the part of any of the parties hereto.
Section 8.13. Preferential Collection of Claims Against Depositor or the
----------------------------------------------------------
Trust. If and when the Property Trustee shall be or become a creditor of the
-----
Depositor of the Trust (or any other obligor upon the Capital Securities), the
Property Trustee shall be subject to the provisions of the Trust Indenture Act
regarding the collection of claims against the Depositor or the Trust ( or any
such other obligor).
Section 8.14. Reports by Property Trustee.
---------------------------
(a) Within 90 days after December 31 of each year commencing with December
31, 1998, the Property Trustee shall transmit by mail to all Securityholders, as
their names and addresses appear in the Securities Register, and to the
Depositor, a brief report dated as of such December 31 with respect to:
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(i) its eligibility under Section 8.07 or, in lieu thereof, if to the
best of its knowledge it has continued to be eligible under said Section, a
written statement to such effect;
(ii) a statement that the Property Trustee has complied with all of its
obligations under this Trust Agreement during the twelve-month period (or, in
the case of the initial report, the period since the Closing Date) ending with
such December 31 or, if the Property Trustee has not complied in any material
respect with such obliga tions, a description of such non-compliance; and
(iii) any change in the property and funds in its possession as Property
Trustee since the date of its last report and any action taken by the Property
Trustee in the performance of its duties hereunder which it has not previously
reported and which in its opinion materially affects the Trust Securities.
(b) In addition, the Property Trustee shall transmit to Securityholders
such reports concerning the Property Trustee and its actions under this Trust
Agreement as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto.
(c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Property Trustee with each stock exchange, the Nasdaq
National Market or such other interdealer quotation system or self-regulatory
organization upon which the Trust Securities are listed or traded, if any, with
the Commission and with the Depositor.
Section 8.15. Reports to the Property Trustee. Each of the Depositor and
-------------------------------
the Administrative Trustees on behalf of the Trust shall provide to the Property
Trustee such documents, reports and information as required by Section 314 of
the Trust Indenture Act (if any) and the compliance certificate required by
Section 314 of the Trust Indenture Act in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act. The Depositor and the
Administrators shall annually file with the Property Trustee a certificate
specifying whether such Person is in compliance with all the terms and covenants
applicable to such Person thereunder.
Section 8.16. Evidence of Compliance with Conditions Precedent. Each of
------------------------------------------------
the Depositor and the Administrative Trustees on behalf of the Trust shall
provide to the Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Trust Agreement that relate to any of
the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) of the Trust Indenture Act may be given in the form of an Officers'
Certificate.
Section 8.17. Number of Trustees.
------------------
(a) The number of Trustees shall be four, provided that the Depositor, by
written instrument, may increase or decrease the number of Administrative
Trustees.
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(b) If a Trustee ceases to hold office for any reason and the number of
Administrative Trustees is not reduced pursuant to Section 8.17(a), or if the
number of Trustees is increased pursuant to Section 8.17(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy, incompetence
or incapacity to perform the duties of a Trustee shall not operate to annul,
dissolve or terminate the Trust. Whenever a vacancy in the number of
Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 8.10, the
Administrative Trustees in office, regardless of their number (and
notwithstanding any other provision of this Agreement), shall have all the
powers granted to the Administrative Trustees and shall discharge all the duties
imposed upon the Administrative Trustees by this Trust Agreement.
Section 8.18. Delegation of Power.
-------------------
(a) Any Administrative Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any documents contemplated in Section
2.07(a), including any registration statement or amendment thereto filed with
the Commission or making any other governmental filing; and
(b) The Administrative Trustees shall have power to delegate from time to
time to such of their number or to the Depositor the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the Administrative Trustees or otherwise as the Administrative Trustees may
deem expedient, to the extent such delegation is not prohibited by applicable
law or contrary to the provisions of the Trust, as set forth herein.
ARTICLE IX
Termination and Liquidation
Section 9.01. Termination Upon Expiration Date. The Trust shall
--------------------------------
automatically terminate on (_______________________, 2053), (the "Expiration
Date") following the distribution of the Trust Property in accordance with
Section 9.04.
Section 9.02. Early Termination. Upon the first to occur of any of the
-----------------
following events (such first occurrence, an "Early Termination Event"):
(a) the occurrence of a Bankruptcy Event in respect of, or the dissolution
or liquidation of, the Depositor;
(b) the written direction to the Property Trustee from the Depositor at any
time (which direction is optional and wholly within the discretion of the
Depositor) to terminate the Trust and distribute the Debentures to the
Securityholders in exchange for the Trust Securities;
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(c) the redemption of all of the Capital Securities in connection with the
redemption of all of the Debentures; and
(d) the entry of an order for dissolution of the Trust shall have been
entered by a court of competent jurisdiction,
then the Trustees shall take such action as is required by Section 4.02 or
Section 9.04, as applicable, and as soon as practicable after the occurrence of
any event referred to in this Section 9.02, the Trustees shall cause to be filed
a certificate of cancellation relating to the Trust with the Secretary of State
of the State of Delaware.
Section 9.03. Termination. The respective obligations and
-----------
responsibilities of the Trustees and the Trust created and continued hereby
shall terminate upon the latest to occur of the following: (a) the distribution
by the Property Trustee to Securityholders upon the liquidation of the Trust
pursuant to Section 9.04, or upon the redemption of all of the Trust Securities
pursuant to Section 4.02, of all amounts required to be distributed hereunder
upon the final payment of the Trust Securities; (b) the payment of any expenses
owed by the Trust and (c) the discharge of all administrative duties of the
Administrative Trustees, including the performance of any tax reporting
obligations with respect to the Trust or the Securityholders.
Section 9.04. Liquidation.
-----------
(a) If an Early Termination Event specified in clauses (a), (b) or (d) of
Section 9.02 occurs or immediately prior to the Expiration Date specified in
Section 9.01, the Trust shall be liquidated by the Trustees as expeditiously as
the Trustees determine to be possible by distributing, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, to each
Securityholder a Like Amount of the Debentures, subject to Section 9.04(d).
Notice of liquidation shall be given by the Administrative Trustees by first-
class mail, postage prepaid, mailed not later than 30 nor more than 60 days
prior to the Liquidation Date to each Holder of Trust Securities at such
Holder's address appearing in the Securities Register. All notices of
liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust Securities
will no longer be deemed to be Outstanding and any Trust Securities Certificates
not surrendered for exchange will be deemed to represent a Like Amount of the
Debentures; and
(iii) provide such information with respect to the mechanics by which
Holders may exchange Trust Securities Certificates for the Debentures, or if
Section 9.04(d) applies, receive a Liquidation Distribution, as the
Administrative Trustees or the Property Trustee shall deem appropriate.
(b) Except where Sections 9.02(c) or 9.04(d) apply, in order to effect the
liquidation of the Trust and distribution of the Debentures to Securityholders,
the Property Trustee shall establish a record date for such distribution (which
shall be not more than 45 days prior to the Liquidation Date) and, either itself
acting as exchange
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agent or through the appointment of a separate exchange agent, shall establish
such procedures as it shall deem appropriate to effect the distribution of the
Debentures in exchange for the Outstanding Trust Securities Certificates.
(c) Except where Sections 9.02 (c) or 9.04(d) apply, after the Liquidation
Date, (i) the Trust Securities will no longer be deemed to be Outstanding, (ii)
The Depository Trust Company ("DTC") or its nominee, as the record Holder of the
Capital Securities, will receive a registered global certificate or certificates
representing the Debentures to be delivered upon such distribution, (iii) any
Capital Securities Certificates not held by DTC or its nominee will be deemed to
represent a Like Amount of the Debentures, bearing accrued and unpaid interest
in an amount equal to the accumulated and unpaid Distributions on such Trust
Certificates until such certificates are so surrendered (and until such
certificates are so surrendered, no payments or interest or principal will be
made to Holders of Trust Securities Certificates with respect to such
Debentures), (iv) certificates representing a Like Amount of the Debentures will
be issued to the Holder of the Common Securities Certificates, upon surrender of
such certificates to the Administrative Trustees or their agent for exchange,
(v) all rights of Securityholders holding Trust Securities will cease, except
the right of such Securityholders to receive the Debentures upon surrender of
Trust Securities Certificates and (vi) the Depositor shall use its reasonable
efforts to have the Debentures listed on the New York Stock Exchange or on such
other exchange, interdealer quotation system or self-regulatory organization as
the Capital Securities are then listed, if any.
(d) In the event that, notwithstanding the other provisions of this Section
9.04, whether because of an order for dissolution entered by a court of
competent jurisdiction or payment at the stated maturity thereof of all
principal of and interest on the Debentures or otherwise, distribution of the
Debentures in the manner provided herein is determined by the Property Trustee
not to be practical, the Trust Property shall be liquidated, and the Trust shall
be dissolved, wound-up or terminated, by the Property Trustee in such manner as
the Property Trustee determines. In such event, on the date of the dissolution,
winding-up or other termination of the Trust, Securityholders will be entitled
to receive out of the assets of the Trust available for distribution to
Securityholders, after satisfaction of liabilities to creditors, an amount equal
to the Liquidation Amount per Trust Security plus accumulated and unpaid
Distributions thereon to the date of payment (such amount being the "Liquidation
Distribution"). If, upon any such dissolution, winding up or termination, the
Liquidation Distribution can be paid only in part because the Trust has
insufficient assets available to pay in full the aggregate Liquidation
Distribution, then, subject to the next succeeding sentence, the amounts payable
by the Trust on the Trust Securities shall be paid on a pro rata basis (based
upon Liquidation Amounts). The Holder of the Common Securities will be entitled
to receive Liquidation Distributions upon any such dissolution, winding-up or
termination pro rata (determined as aforesaid) with Holders of Capital
Securities, except that, if an Event of Default specified in Sections 501(a) or
501(b) of the Indenture has occurred and is continuing, the Capital Securities
shall have a priority over the Common Securities. In the event the Capital
Securities are issued in certificated form, the Liquidation Distribution will be
payable at (i) the Corporate Trust Office of the Property Trustee, (ii) the
principal office of any Paying Agent or (iii) the principal office of the
Securities Registrar and Transfer Agent; provided that payment of any
Liquidation Distribution may be made, at the option of the Administrative
Trustees, by
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check mailed to the address of the Person entitled thereto as such address shall
appear on the Securities Register or by wire transfer in immediately available
funds at such place and to such place and to such account as may be designated
by the Person entitled thereto as specified in the Securities Register.
Section 9.05. Merger, Consolidation, Amalgamation or Replacement of the
---------------------------------------------------------
Trust.
-----
The Trust may not merge, consolidate or amalgamate with or into, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other Person, except pursuant
to this Section 9.05. At the request of the Depositor, with the consent of the
Administrative Trustees and with the consent of the Holders of at least a
Majority in Liquidation Amount of the Capital Securities or the Property
Trustee, the Trust may merge, consolidate or amalgamate with or into, or be
replaced by or convey, transfer or lease its properties and assets substantially
as an entirety to a trust organized as such under the laws of any State;
provided, that (a) such successor entity either (i) expressly assumes all of the
obligations of the Trust with respect to the Capital Securities or (ii)
substitutes for the Capital Securities other securities having substantially the
same terms as the Capital Securities (the "Successor Securities") so long as the
Successor Securities rank the same as the Capital Securities rank in priority
with respect to distributions and payments upon liquidation, redemption and
otherwise, (b) the Depositor expressly appoints a trustee of such successor
entity possessing the same powers and duties as the Property Trustee as the
holder of the Debentures, (c) the Successor Securities are listed or quoted, or
any Successor Securities will be listed or quoted upon notification of issuance,
on any national securities exchange, Nasdaq or other organization on which the
Capital Securities are then quoted or listed, if any, (d) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
cause the Capital Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating organization, (e)
such merger, consolidation, amalgamation, replacement, conveyance, transfer or
lease does not adversely affect the rights, preferences and privileges of the
Holders of the Capital Securities (including any Successor Securities) in any
material respect, (f) such successor entity has a purpose substantially
identical to that of the Trust, (g) prior to such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the Depositor has
received an opinion from independent counsel to the Trust experienced in such
matters to the effect that (i) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders of the Capital Securities (including
any Successor Securities) in any material respect and (ii) following such
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease,
neither the Trust nor such successor entity will be required to register as an
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"), and (h) the Depositor or any permitted successor or assignee owns
all of the common securities of such successor entity and guarantees the
obligations of such successor entity under the Successor Securities at least to
the extent provided by the Guarantee. Notwithstanding the foregoing, the Trust
shall not, except with the consent of Holders of 100% in Liquidation Amount of
the Capital Securities, consolidate, amalgamate or merge with or into, or be
replaced by or convey, transfer or lease its properties and assets substantially
as an entirety to any other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
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amalgamation, merger, replacement, conveyance, transfer or lease would cause the
Trust or the successor entity to be taxable as a corporation or classified as
other than a grantor trust for United States federal income tax purposes or
cause the Junior Subordinated Debentures to be treated as other than
indebtedness of the Parent for United States federal income tax purposes.
ARTICLE X
Miscellaneous Provisions
Section 10.01. Expense Agreement. It is the contemplation of the parties
-----------------
that the Expense Agreement shall be entered into no later than
_________________________,1998.
Section 10.02. Limitation of Rights of Securityholders. The death or
---------------------------------------
incapacity of any person having an interest, beneficial or otherwise, in the
Trust Securities shall not operate to terminate this Trust Agreement, nor
entitle the legal representatives or heirs of such person or any Securityholder
for such person, to claim an accounting, take any action or bring any proceeding
in any court for a partition or winding up of the arrangements contemplated
hereby nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
Section 10.03. Amendment.
---------
(a) This Trust Agreement may be amended from time to time by the Trustees
and the Depositor, without the consent of any Securityholders, (i) to cure any
ambiguity, correct or supplement any provision herein which may be inconsistent
with any other provision herein or to make any other provisions with respect to
matters or questions arising under this Trust Agreement, which shall not be
inconsistent with the other provisions of this Trust Agreement or (ii) to
modify, eliminate or add to any provisions of this Trust Agreement to such
extent as shall be necessary to ensure that the Trust will not be taxable as a
corporation or will be classified as a grantor trust for United States federal
income tax purposes at all times that any Trust Securities are outstanding or to
ensure that the Trust will not be required to register as an "investment
company" under the 1940 Act; provided, however, that in the case of either
clause (i) or clause (ii), such action shall not adversely affect in any
material respect the interests of any Securityholder and any amendments of this
Trust Agreement shall become effective when notice thereof is given to the
Securityholders.
(b) Except as provided in Section 10.03(c) hereof, any provision of this
Trust Agreement may be amended by the Trustees and the Depositor with (i) the
consent of Trust Securityholders representing not less than a majority in
Liquidation Amount of the Trust Securities then Outstanding and (ii) the receipt
by the Trustees of an Opinion of Counsel to the effect that such amendment or
the exercise of any power granted to the Trustees in accordance with such
amendment will not affect the Trust's status as a grantor trust or cause the
Trust to be taxable as a corporation for United States federal income tax
purposes or the Trust's exemption from status as an "investment company" under
the Investment Company Act of 1940, as amended.
-48-
(c) In addition to and notwithstanding any other provision in this Trust
Agreement, without the consent of each affected Securityholder (such consent
being obtained in accordance with Section 6.03 or 6.06 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date or (ii) restrict the right of a Securityholder to institute suit
for the enforcement of any such payment on or after such date; notwithstanding
any other provision herein without the unanimous consent of the Securityholders
(such consent being obtained in accordance with Section 6.03 or 6.06 hereof),
paragraph (b) of this Section 10.03 may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Trust to (i) fail or cease to qualify, as evidenced by an
Opinion of Counsel, for an exemption from status of an "investment company"
under the Investment Company Act of 1940, as amended, or (ii) be taxable as a
corporation or fail or cease to be classified, as evidenced by an Opinion of
Counsel, as a grantor trust for United States federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor and the Administrative Trustees, this Trust
Agreement may not be amended in a manner which imposes any additional obligation
on the Depositor or the Administrative Trustees.
(f) In the event that any amendment to this Trust Agreement is made, the
Administrative Trustees shall promptly provide to the Depositor a copy of such
amendment.
(g) The Property Trustee shall not be required to enter into any amendment
to this Trust Agreement which affects its own rights, duties or immunities under
this Trust Agreement. The Property Trustee shall be entitled to receive an
Opinion of Counsel and an Officer's Certificate stating that any amendment to
this Trust Agreement is in compliance with this Trust Agreement.
Section 10.04. Separability. In case any provision in this Trust
------------
Agreement or in the Trust Securities Certificates shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions hereof and thereof shall not in any way be affected or impaired
thereby.
SECTION 10.05. GOVERNING LAW. THIS TRUST AGREEMENT AND THE RIGHTS AND
-------------
OBLIGATIONS OF EACH OF THE SECURITYHOLDERS, THE DEPOSITOR, THE TRUST AND THE
TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT AND THE TRUST SECURITIES SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE
WITHOUT REFERENCE TO ITS CONFLICTS OF LAWS PROVISIONS.
Section 10.06. Payments Due on Non-Business Day. If the date fixed for
--------------------------------
any payment on any Trust Security shall be a day which is not a Business Day,
then such payment need not be made on such date but may be made on the next
succeeding day
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which is a Business Day (except as otherwise provided in Section 4.01(a) and
4.02(d)), with the same force and effect as though made on the date fixed for
such payment, and no Distribution shall accumulate on such unpaid amount thereon
for the period after such date.
Section 10.07. Successors. This Trust Agreement shall be binding upon and
----------
shall inure to the benefit of any successor to the Depositor, the Trust or any
Relevant Trustee, including any successor by operation of law. Except in
connection with a consolidation, merger or sale involving the Depositor that is
permitted under Article Eight of the Indenture and pursuant to which the
assignee agrees in writing to perform the Depositor's obligations hereunder, the
Depositor shall not assign its obligations hereunder.
Section 10.08. Headings. The Article and Section headings are for
--------
convenience only and shall not affect the construction of this Trust Agreement.
Section 10.09. Reports, Notices and Demands. Any report, notice, demand
----------------------------
or other communication which by any provision of this Trust Agreement is
required or permitted to be given or served to or upon any Securityholder or the
Depositor shall be given or served in writing by deposit thereof, postage
prepaid, in the United States mail, hand delivery or facsimile transmission, in
each case, addressed, (a) in the case of a Capital Securityholder, to such
Capital Securityholder as such Securityholder's name and address may appear on
the Securities Register; and (b) in the case of the Common Securityholder or the
Depositor, to Pennsylvania Manufacturers Corporation, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: President, facsimile no.:
(▇▇▇) ▇▇▇-▇▇▇▇. Such notice, demand or other communication to or upon a
Securityholder shall be deemed to have been sufficiently given or made, for all
purposes, upon hand delivery, mailing or transmission.
Any notice, demand or other communication which by any provision of this
Trust Agreement is required or permitted to be given or served to or upon the
Trust, the Property Trustee or the Administrative Trustees shall be given in
writing addressed (until another address is published by the Trust) as follows:
(a) with respect to the Trustee, to The Bank of New York (Delaware),
__________________________________________ Attention: Corporate Trust
Administration; (b) with respect to the Property Trustee, The Bank of New York,
_______________________________; Attention: Corporate Trust Administration and
(c) with respect to the Administrative Trustees, to them at the address above
for notices to the Depositor, marked "Attention: Administrative Trustees of PMC
Capital I c/o President." Such notice, demand or other communication to or upon
the Trust or the Property Trustee shall be deemed to have been sufficiently
given or made only upon actual receipt of the writing by the Trust or the
Property Trustee.
Section 10.10. Agreement Not to Petition. Each of the Trustees and the
-------------------------
Depositor agree for the benefit of the Securityholders that, until at least one
year and one day after the Trust has been terminated in accordance with Article
IX, they shall not file, or join in the filing of, a petition against the Trust
under any bankruptcy, reorganization, arrangement, insolvency, liquidation or
other similar law (including, without limitation, the United States Bankruptcy
Code) (collectively, "Bankruptcy Laws") or otherwise join in the commencement of
any proceeding against the Trust under any Bankruptcy Law.
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In the event the Depositor takes action in violation of this Section 10.10, the
Property Trustee agrees, for the benefit of Securityholders, that at the expense
of the Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Depositor against the Trust
or the commencement of such action and raise the defense that the Depositor has
agreed in writing not to take such action and should be stopped and precluded
therefrom and such other defenses, if any, as counsel for the Property Trustee
or the Trust may assert. The provisions of this Section 10.10 shall survive the
termination of this Trust Agreement.
Section 10.11. Trust Indenture Act; Conflict with Trust Indenture Act.
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(a) This Trust Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trust Agreement and shall, to
the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a Trustee for
the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with the duties
imposed by Section 310 to 317, inclusive, of the Trust Indenture Act through
operation of Section 318(c) thereof, such imposed duty provision shall control.
If any provision of this Trust Agreement modifies or excludes any provision of
the Trust Indenture Act which may be so modified or excluded, the latter
provision shall be deemed to apply to this Trust Agreement as so modified or
excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
Section 10.12. Rights Under Indenture. The Trust may not assign any of
----------------------
its rights under the Indenture without the prior written consent of the
Depositor.
Section 10.13. Effectiveness. This Trust Agreement shall become effective
-------------
when signed by the Depositor, the Trustee and the Bank. Each Administrative
Trustee shall assume the duties of an Administrative Trustee hereunder when he
signs the signature page hereof.
Section 10.14. Intention of the Parties. It is the intention of the parties
------------------------
hereto that the Trust not be characterized for United States federal income tax
purposes as a corporation or a partnership, but rather that the Trust be
characterized as a grantor trust or otherwise in a manner that each Owner be
treated as owning an undivided beneficial interest in the assets of the Trust.
The provisions of this Trust Agreement shall be interpreted to further this
intention of the parties.
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THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY OR ON
BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST
SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND AGREEMENT
TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE
INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER
AND SUCH OTHERS THAT THOSE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE
BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH SECURITYHOLDER
AND SUCH OTHERS.
PENNSYLVANIA MANUFACTURERS
CORPORATION, as Depositor
By:
-----------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
President and Chief Executive Officer
THE BANK OF NEW YORK (DELAWARE),
as Trustee
By:
-----------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Property Trustee
By:
-----------------------------------
Name:
Title:
--------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
as Administrative Trustee
--------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
as Administrative Trustee
--------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
as Administrative Trustee
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