TABLE
OF CONTENTS
(continued)
ANNEXES
AND EXHIBITS
|
|
Terms
of Capital Securities and Common Securities
|
EXHIBIT
A-1
|
|
Form
of Capital Security Certificate
|
EXHIBIT
A-2
|
|
Form
of Common Security Certificate
|
EXHIBIT
B
|
|
Form
of Transferee Certificate to be Executed by Transferees Other than
QIBs
|
EXHIBIT
C
|
|
Form
of Transferor Certificate to be Executed for QIBs
|
EXHIBIT
D
|
|
Form
of Officer’s Financial Certificate
|
|
|
Form
of Regulation S Global Capital Security Transferee
Certificate
|
EXHIBIT
F
|
|
Form
of Rule 144A Global Capital Security Transferee
Certificate
|
AMENDED
AND RESTATED DECLARATION OF TRUST
OF
Hallmark
Statutory Trust II
August
23, 2007
AMENDED
AND RESTATED DECLARATION OF TRUST (this “Declaration”), dated and effective as
of August 23, 2007, by the Trustees (as defined herein), the Administrators
(as
defined herein) and the Sponsor (as defined herein).
WHEREAS,
the Delaware Trustee and the Sponsor established Hallmark Statutory Trust II
(the “Trust”), a statutory trust under the Statutory Trust Act (as defined
herein), pursuant to a Declaration of Trust, dated as of August 21, 2007, (the
“Original Declaration”), and a Certificate of Trust filed with the Secretary of
State of the State of Delaware on August 21, 2007, for the sole purpose of
issuing and selling certain securities representing undivided beneficial
interests in the assets of the Trust and investing the proceeds thereof in
certain debentures of the Debenture Issuer (as defined herein);
WHEREAS,
as of the date hereof, no interests in the assets of the Trust have been issued;
and
WHEREAS,
all of the Trustees, the Administrators and the Sponsor, by this Declaration,
amend and restate each and every term and provision of the Original
Declaration.
NOW,
THEREFORE, it being the intention of the parties hereto to continue the Trust
as
a statutory trust under the Statutory Trust Act and that this Declaration
constitutes the governing instrument of such statutory trust, and that all
assets contributed to the Trust will be held in trust for the benefit of the
holders, from time to time, of the securities representing undivided beneficial
interests in the assets of the Trust issued hereunder, subject to the provisions
of this Declaration, and, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties, intending to be legally bound hereby, amend and
restate in its entirety the Original Declaration and agree as
follows:
ARTICLE
I.
INTERPRETATION
AND DEFINITIONS
SECTION
1.1.
Definitions
.
Unless
the context otherwise requires:
(a)
capitalized
terms used in this Declaration but not defined in the preamble above or
elsewhere herein have the respective meanings assigned to them in this
Section 1.1 or, if not defined in this Section 1.1 or elsewhere
herein, in the Indenture;
(b)
a
term
defined anywhere in this Declaration has the same meaning
throughout;
(c)
all
references to “the Declaration” or “this Declaration” are to this Declaration as
modified, supplemented or amended from time to time;
(d)
all
references in this Declaration to Articles and Sections and Annexes and Exhibits
are to Articles and Sections of and Annexes and Exhibits to this Declaration
unless otherwise specified;
(e)
a
term
defined in the Trust Indenture Act (as defined herein) has the same meaning
when
used in this Declaration unless otherwise defined in this Declaration or unless
the context otherwise requires; and
(f)
a
reference to the singular includes the plural and vice versa.
“Additional
Interest” has the meaning set forth in Section 3.06 of the
Indenture.
“Administrative
Action” has the meaning set forth in paragraph 4(a) of Annex I.
“Administrators”
means each of Mark Schwartz and Mark Morrison, solely in such Person’s capacity
as Administrator of the Trust continued hereunder and not in such Person’s
individual capacity, or such Administrator’s successor in interest in such
capacity, or any successor appointed as herein provided.
“Affiliate”
has the same meaning as given to that term in Rule 405 of the Securities Act
or
any successor rule thereunder.
“Agent
Members” has the meaning set forth in Section 6.4(e).
“Applicable
Accounting Principles” means accounting practices prescribed or permitted by the
National Association of Insurance Commissioners, if then applicable to the
Sponsor or its subsidiaries, and/or the applicable insurance department or
regulator of the jurisdiction
of
domicile of such Regulated Insurance Company, and in each case, applied
consistently throughout the periods involved.
“Applicable
Depositary Procedures” means, with respect to any transfer or transaction
involving a Book-Entry Capital Security, the rules and procedures of the
Depositary for such Book-Entry Capital Security, in each case to the extent
applicable to such transaction and as in effect from time to time.
“Applicable
Insurance Regulatory Authority” means, when used with respect to any Regulated
Insurance Company, (x) the insurance department or similar administrative
authority or agency located in each state or jurisdiction (foreign or domestic)
in which such Regulated Insurance Company is domiciled or (y) to the extent
asserting regulatory jurisdiction over such Regulated Insurance Company, the
insurance department, authority or agency in each state or jurisdiction (foreign
or domestic) in which such Regulated Insurance Company is licensed, and shall
include any Federal or national insurance regulatory department, authority
or
agency that may be created and that asserts insurance regulatory jurisdiction
over such Regulated Insurance Company.
“Authorized
Officer” of a Person means any Person that is authorized to bind such
Person.
“Bankruptcy
Event” means, with respect to any Person:
(a)
a
court
having jurisdiction in the premises enters a decree or order for relief in
respect of such Person in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or appoints a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of such Person or for any substantial part of its property, or orders
the winding-up or liquidation of its affairs, and such decree, appointment
or
order remains unstayed and in effect for a period of 90 consecutive days;
or
(b)
such
Person commences a voluntary case under any applicable bankruptcy, insolvency
or
other similar law now or hereafter in effect, consents to the entry of an order
for relief in an involuntary case under any such law, or consents to the
appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of such Person of
any
substantial part of its property, or makes any general assignment for the
benefit of creditors, or fails generally to pay its debts as they become
due.
“Book-Entry
Capital Security” means a Capital Security, the ownership and transfers of which
shall be made through book entries by a Depositary.
“Business
Day” means any day other than Saturday, Sunday or any other day on which banking
institutions in Wilmington, Delaware, New York City or are permitted or required
by any applicable law or executive order to close.
“Calculation
Agent” has the meaning set forth in Section 1.01 of the
Indenture.
“Capital
Securities” has the meaning set forth in Section 6.1(a).
“Capital
Securities Purchase Agreements” means the Capital Securities Purchase Agreement
dated as of August 21, 2007 among the Trust, the Sponsor and Alesco Preferred
Funding XIII, Ltd., the Capital Securities Purchase Agreement dated as of August
21, 2007 among the Trust, the Sponsor and PFW III, Ltd. and the Capital
Securities Purchase Agreement dated as of August 21, 2007 among the Trust,
the
Sponsor and Alesco Preferred Funding XVI, Ltd.
“Capital
Security Certificate” means a definitive Certificate registered in the name of
the Holder representing a Capital Security substantially in the form of Exhibit
A 1.
“Certificate”
means any certificate evidencing Securities.
“Certificate
of Trust” means the certificate of trust filed with the Secretary of State of
the State of Delaware with respect to the Trust, as amended and restated from
time to time.
“Closing
Date” has the meaning set forth in the Placement Agreement.
“Code”
means the Internal Revenue Code of 1986, as amended from time to time, or any
successor legislation.
“Commission”
means the United States Securities and Exchange Commission.
“Common
Securities” has the meaning set forth in Section 6.1(a).
“Common
Security Certificate” means a definitive Certificate registered in the name of
the Holder representing a Common Security substantially in the form of Exhibit
A-2.
“Company
Indemnified Person” means (a) any Administrator; (b) any Affiliate of any
Administrator; (c) any officers, directors, shareholders, members, partners,
employees, representatives or agents of any Administrator; or (d) any officer,
employee or agent of the Trust or its Affiliates.
“Corporate
Trust Office” means the office of the Institutional Trustee at which the
corporate trust business of the Institutional Trustee shall, at any particular
time, be principally administered, which office shall at all times be located
in
the United States and at the date of execution of this Declaration is located
at
601 Travis Street, 16
th
Floor,
Houston, Texas 77002, Attention: Global Corporate Trust - Hallmark Statutory
Trust II. Initially, all notices and correspondence shall be addressed to
Mudassir Mohamed (telephone 713-483-6029).
“Coupon
Rate” has the meaning set forth in paragraph 2(a) of Annex I.
“Covered
Person” means: (a) any Administrator, officer, director, shareholder, partner,
member, representative, employee or agent of (i) the Trust or (ii) the Trust’s
Affiliates; and (b) any Holder of Securities.
“Debenture
Issuer” means Hallmark Financial Services, Inc., incorporated in Nevada, in its
capacity as issuer of the Debentures under the Indenture.
“Debenture
Trustee” means The Bank of New York Trust Company, National Association, not in
its individual capacity but solely as trustee under the Indenture until a
successor is appointed thereunder, and thereafter means such successor
trustee.
“Debentures”
means the Junior Subordinated Debt Securities due September 15, 2037 to be
issued by the Debenture Issuer under the Indenture.
“Deferred
Interest” means any interest on the Debentures that would have been overdue and
unpaid for more than one Distribution Payment Date but for the imposition of
an
Extension Period, and the interest that shall accrue (to the extent that the
payment of such interest is legally enforceable) on such interest at the Coupon
Rate in effect for each such Extension Period, compounded quarterly from the
date on which such Deferred Interest would otherwise have been due and payable
until paid or made available for payment.
“Definitive
Capital Securities” means any Capital Securities in definitive form issued by
the Trust.
“Delaware
Trustee” has the meaning set forth in Section 4.2.
“Depositary”
means an organization registered as a clearing agency under the Exchange Act
that is designated as Depositary by the Sponsor or any successor thereto. DTC
will be the initial Depositary.
“Depositary
Participant” means a broker, dealer, bank, other financial institution or other
Person for whom from time to time the Depositary effects book-entry transfers
and pledges of securities deposited with the Depositary.
“Direct
Action” has the meaning set forth in Section 2.8(e).
“Distribution”
means a distribution payable to Holders of Securities in accordance with
Section 5.1.
“Distribution
Payment Date” has the meaning set forth in paragraph 2(e) of Annex
I.
“Distribution
Period” has the meaning set forth in Paragraph 2(a) of Annex I.
“DTC”
means The Depository Trust Company or any successor thereto.
“Event
of
Default” means the occurrence of an Indenture Event of Default.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to time, or
any successor legislation.
“Extension
Period” has the meaning set forth in paragraph 2(e) of Annex I.
“Fiduciary
Indemnified Person” shall mean each of the Institutional Trustee (including in
its individual capacity), the Delaware Trustee (including in its individual
capacity), any Affiliate of the Institutional Trustee or the Delaware Trustee,
and any officers, directors, shareholders, members, partners, employees,
representatives, custodians, nominees or agents of the Institutional Trustee
or
the Delaware Trustee.
“Fiscal
Year” has the meaning set forth in Section 10.1.
“Fixed
Rate” has the meaning set forth in paragraph 2(a) of Annex I.
“Fixed
Rate Period” has the meaning set forth in paragraph 2(a) of Annex I.
“Global
Capital Security” means each of a Global Regulation S Capital Security and a
Global Rule 144A Capital Security.
“Global
Regulation S Capital Security” means a Regulation S Capital Securities
Certificate evidencing ownership of Book-Entry Capital Securities.
“Global
Rule 144A Capital Security” means a Rule 144A Capital Securities Certificate
evidencing ownership of Book-Entry Capital Securities.
“Guarantee”
means the Guarantee Agreement, dated as of August 23, 2007, of the Sponsor
(the
“Guarantor”) in respect of the Capital Securities.
“Holder”
means a Person in whose name a Certificate representing a Security is registered
on the register maintained by or on behalf of the Registrar, such Person being
a
beneficial owner within the meaning of the Statutory Trust Act.
“Indemnified
Person” means a Company Indemnified Person or a Fiduciary Indemnified
Person.
“Indenture”
means the Indenture, dated as of August 23, 2007, among the Debenture Issuer
and
the Debenture Trustee, and any indenture supplemental thereto pursuant to which
the Debentures are to be issued.
“Indenture
Event of Default” means an “Event of Default” as defined in the
Indenture.
“Initial
Securities” has the meaning set forth in Section 8.4.
“Institutional
Trustee” means the Trustee meeting the eligibility requirements set forth in
Section 4.3.
“Insurance
Business” means one or more aspects of the business of selling, issuing or
underwriting insurance or reinsurance.
“Investment
Company” means an investment company as defined in the Investment Company
Act.
“Investment
Company Act” means the Investment Company Act of 1940, as amended from time to
time, or any successor legislation.
“Investment
Company Event” has the meaning set forth in paragraph 4(a) of Annex
I.
“Legal
Action” has the meaning set forth in Section 2.8(e).
“LIBOR”
means the London Interbank Offered Rate for U.S. Dollar deposits in Europe
as
determined by the Calculation Agent according to paragraph 2(b) of Annex
I.
“LIBOR
Banking Day” has the meaning set forth in paragraph 2(b)(1) of Annex
I.
“LIBOR
Business Day” has the meaning set forth in paragraph 2(b)(1) of Annex
I.
“LIBOR
Determination Date” has the meaning set forth in paragraph 2(b)(1) of Annex
I.
“Liquidation”
has the meaning set forth in paragraph 3 of Annex I.
“Liquidation
Distribution” has the meaning set forth in paragraph 3 of Annex I.
“Majority
in liquidation amount of the Securities” means Holders of outstanding Securities
voting together as a single class or, as the context may require, Holders of
outstanding Capital Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of more than 50% of
the
aggregate liquidation amount (including the stated amount that would be paid
on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions
to
the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
“Maturity
Date” has the meaning set forth in paragraph 4 of Annex I.
“Maturity
Redemption Price” has the meaning set forth in paragraph 4 of Annex
I.
“Notice”
has the meaning set forth in Section 2.11 of the Indenture.
“Officers’
Certificate” means, with respect to any Person, a certificate signed by two
Authorized Officers of such Person. Any Officers’ Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Declaration shall include:
(a)
a
statement that each officer signing the 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.
“
Outstanding
”
,
when
used with respect to any Capital Securities, means, as of the date of
determination, all Capital Securities theretofore executed and delivered under
this Declaration, except:
(a)
Capital
Securities theretofore canceled by the Institutional Trustee or delivered to
the
Institutional Trustee for cancellation;
(b)
Capital
Securities for which payment or redemption money in the necessary amount has
been theretofore deposited with the Institutional Trustee in trust for the
Holders of such Capital Securities;
provided
,
that
if
such Capital Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Declaration; and
(c)
Capital
Securities that have been paid or in exchange for or in lieu of which other
Capital Securities have been executed and delivered pursuant to the provisions
of this Declaration, unless proof satisfactory to the Institutional Trustee
is
presented that any such Capital Securities are held by Holders in whose hands
such Capital Securities are valid, legal and binding obligations of the Trust;
provided,
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
Sponsor, any Trustee or any Affiliate of the Sponsor or of any Trustee shall
be
disregarded and deemed not to be Outstanding, except that (i) in
determining whether any Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Capital Securities that such Trustee has actual knowledge to be so owned shall
be so disregarded and (ii) the foregoing shall not apply at any time when
all of the Outstanding Capital Securities are owned by the Sponsor, one or
more
of the Trustees and/or any such Affiliate. Capital Securities so owned that
have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Administrators the pledgee’s right so to
act with respect to such Capital Securities and that the pledgee is not the
Sponsor, any Trustee or any Affiliate of the Sponsor or of any
Trustee.
“Owner”
means each Person who is the beneficial owner of Book-Entry Capital Securities
as reflected in the records of the Depositary or, if a Depositary Participant
is
not the beneficial owner, then the beneficial owner as reflected in the records
of the Depositary Participant.
“Paying
Agent” has the meaning set forth in Section 6.2.
“Payment
Amount” has the meaning set forth in Section 5.1.
“Person”
means a legal person, including any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated association, or government or any agency or
political subdivision thereof, or any other entity of whatever
nature.
“Placement
Agreement” means the Placement Agreement dated as of August 21, 2007 among
Hallmark Statutory Trust II, Hallmark Financial Services, Inc. and Cohen &
Company, relating to the offering and sale of Capital Securities.
“PORTAL”
has the meaning set forth in Section 2.6(a)(í).
“Property
Account” has the meaning set forth in Section 2.8(c).
“Pro
Rata” has the meaning set forth in paragraph 8 of Annex I.
“QIB”
or
“Qualified Institutional Buyer” means a “qualified institutional buyer” as
defined in Rule 144A under the Securities Act of 1933, as amended.
“QIB/QP”
mean any Person that, at the time of its acquisition, purported acquisition
or
proposed acquisition of Capital Securities, is both a QIB and a QP.
“QP”
or
“Qualified Purchaser” means (i) a “qualified purchaser” within the meaning of
Section 3(c)(7) of the Investment Company Act or (ii) a company
beneficially owned exclusively by one or more “qualified purchasers” and/or
“knowledgeable employees” with respect to the Sponsor within the meaning of Rule
3c-5 under the Investment Company Act.
“Quorum”
means a majority of the Administrators or, if there are only two Administrators,
both of them.
“Redemption/Distribution
Notice” has the meaning set forth in paragraph 4(e) of
Annex I.
“Redemption
Price” has the meaning set forth in paragraph 4(a) of Annex I.
“Registrar”
has the meaning set forth in Section 6.2.
“Regulated
Insurance Company” means any subsidiary of the Sponsor, whether now owned or
hereafter acquired, that is authorized or admitted to carry on or transact
Insurance Business in any jurisdiction (foreign or domestic) and is regulated
by
any Applicable Insurance Regulatory Authority.
“Regulation
S” means Regulations S under the Securities Act.
“Regulation
S Capital Security” means a certificate evidencing ownership of Capital
Securities, substantially in the form attached as Exhibit A-1, issued to a
Person pursuant to the exemption provided by Regulation S.
“Relevant
Trustee” has the meaning set forth in Section 4.7(a).
“Resale
Restriction Termination Date” means, with respect to any Capital Security, the
date which is the later of (i) two years (or such shorter period of time as
permitted by Rule 144(k) under the Securities Act) after the later of (y) the
date of original issuance of such Capital Security and (z) the last date on
which the Trust or any Affiliate of the Trust was the Holder of such Capital
Security (or any predecessor thereto) and (ii) such later date, if any, as
may
be required by any subsequent change in applicable law.
“Responsible
Officer” means, with respect to the Institutional Trustee, any officer within
the Corporate Trust Office of the Institutional Trustee with direct
responsibility for the administration of this Declaration, including any
vice-president, any assistant vice-president, any secretary, any assistant
secretary, the treasurer, any assistant treasurer, any trust officer or other
officer of the Corporate Trust Office of the Institutional Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer’s
knowledge of and familiarity with the particular subject.
“Restricted
Securities Legend” has the meaning set forth in Section 8.2(c).
“Rule
3a-5” means Rule 3a-5 under the Investment Company Act.
“Rule
3a-7” means Rule 3a-7 under the Investment Company Act.
“Rule
144A” means Rule 144A under the Securities Act.
“Rule
144A Capital Security” means a certificate evidencing ownership of Capital
Securities, substantially in the form attached as Exhibit A-1, issued to a
Person pursuant to the exemption provided by Rule 144A.
“SEC”
means the Securities and Exchange Commission.
“Securities”
means the Common Securities and the Capital Securities.
“Securities
Act” means the Securities Act of 1933, as amended from time to time, or any
successor legislation.
“Securities
Register” has the meaning specified in Section 8.1(d).
“Significant
Subsidiary(ies) has the meaning defined in Section 1-02(w) of Regulation
S-X of the Securities Act.
“Special
Redemption Date” has the meaning set forth in Section 4(a) of Annex
I.
“Sponsor”
means Hallmark Financial Services, Inc., a corporation that is a U.S. Person
incorporated in Nevada, or any successor entity in a merger, consolidation
or
amalgamation that is a U.S. Person, in its capacity as sponsor of the
Trust.
“Statutory
Financial Statements” means all financial statements of the Sponsor’s subsidiary
insurance companies for each relevant period, prepared in accordance with
Applicable Accounting Principles.
“Statutory
Trust Act” means Chapter 38 of Title 12 of the Delaware Code, 12 Del. Code §
3801 et seq., as it may be amended from time to time, or any successor
legislation.
“Successor
Delaware Trustee” has the meaning set forth in Section 4.7(e).
“Successor
Entity” has the meaning set forth in Section 2.15(b).
“Successor
Institutional Trustee” has the meaning set forth in
Section 4.7(b).
“Successor
Securities” has the meaning set forth in Section 2.15(b).
“Super
Majority” has the meaning set forth in paragraph 5(b) of Annex I.
“Tax
Event” has the meaning set forth in paragraph 4(a) of Annex I.
“10%
in
liquidation amount of the Securities” means Holders of outstanding Securities
voting together as a single class or, as the context may require, Holders of
outstanding Capital Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of 10% or more of the
aggregate liquidation amount (including the stated amount that would be paid
on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions
to
the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
“Transfer
Agent” has the meaning set forth in Section 6.2.
“Trust
Indenture Act” means the Trust Indenture Act of 1939, as amended from
time-to-time, or any successor legislation.
“Trustee”
or “Trustees” means each Person who has signed this Declaration as a trustee, so
long as such Person shall continue in office in accordance with the terms
hereof, and all other Persons who may from time to time be duly appointed,
qualified and serving as Trustees in accordance with the provisions hereof,
and
references herein to a Trustee or the Trustees shall refer to such Person or
Persons solely in their capacity as trustees hereunder.
“Trust
Property” means (a) the Debentures, (b) any cash on deposit in, or owing to, the
Property Account and (c) all proceeds and rights in respect of the foregoing
and
any other property and assets for the time being held or deemed to be held
by
the Institutional Trustee pursuant to the trusts of this
Declaration.
“U.S.
Person” means a United States Person as defined in Section 7701(a)(30) of
the Code.
“Variable
Rate” has the meaning set forth in paragraph 2(a) of Annex I.
ARTICLE
II.
ORGANIZATION
SECTION
2.1.
Name
.
The
Trust is named “Hallmark Statutory Trust II,” as such name may be modified from
time to time by the Administrators following written notice to the Institutional
Trustee and the Holders of the Securities. The Trust’s activities may be
conducted under the name of the Trust or any other name deemed advisable by
the
Administrators.
SECTION
2.2.
Office
.
The
address of the principal office of the Trust, which shall be in a state of
the
United States or the District of Columbia, is 777 Main Street, Suite 1000,
Fort
Worth, Texas 76102. On ten Business Days’ written notice to the Institutional
Trustee and the Holders of the Securities, the Administrators may designate
another principal office, which shall be in a state of the United States or
the
District of Columbia.
SECTION
2.3.
Purpose
.
The
exclusive purposes and functions of the Trust are, and the Trust shall have
the
power and authority (a) to issue and sell the Securities representing undivided
beneficial interests in the assets of the Trust, (b) to invest the gross
proceeds from such sale in the Debentures, (c) to enter into and perform its
obligations under the Transaction Documents (as defined in the Placement
Agreement) to which it is a party, and (d) except as otherwise limited herein,
to engage in only those other activities incidental thereto that are deemed
necessary or advisable by the Institutional Trustee, including, without
limitation, those activities specified in this Declaration. The Trust shall
not
borrow money, issue debt or reinvest proceeds derived from investments, pledge
any of its assets, or otherwise undertake (or permit to be undertaken) any
activity that would cause the Trust not to be classified for United States
federal income tax purposes as a grantor trust.
SECTION
2.4.
Authority
.
Except
as specifically provided in this Declaration, the Institutional Trustee shall
have exclusive and complete authority to carry out the purposes of the Trust.
An
action taken by a Trustee on behalf of the Trust and in accordance with such
Trustee’s powers shall constitute the act of and serve to bind the Trust. In
dealing with the Trustees acting on behalf of the Trust, no Person shall be
required to inquire into the authority of the Trustees to bind the Trust.
Persons dealing with the Trust are entitled to rely conclusively on the power
and authority of the Trustees as set forth in this Declaration. The
Administrators shall have only those ministerial duties set forth herein with
respect to accomplishing the purposes of the Trust and are not intended to
be
trustees or fiduciaries with respect to the Trust or the Holders. The
Institutional Trustee shall have the right, but shall not be obligated except
as
provided in Section 2.6, to perform those duties assigned to the
Administrators.
SECTION
2.5.
Title
to Property of the Trust
.
Except
as provided in Section 2.6(g) and Section 2.8 with respect to the
Debentures and the Property Account or as otherwise provided in this
Declaration, legal title to all assets of the Trust shall be vested in the
Trust. The Holders shall not have legal title to any part of the assets of
the
Trust, but shall have an undivided beneficial interest in the assets of the
Trust.
SECTION
2.6.
Powers
and Duties of the Trustees and the Administrators
.
(a)
The
Trustees and the Administrators shall conduct the affairs of the Trust in
accordance with the terms of this Declaration. Subject to the limitations set
forth in paragraph (b) of this Section, and in accordance with the following
provisions (i) and (ii), the Administrators and, at the direction of the
Administrators, the Trustees, shall have the authority to enter into all
transactions and agreements determined by the Administrators to be appropriate
in exercising the authority, express or implied, otherwise granted to the
Trustees or the Administrators, as the case may be, under this Declaration,
and
to perform all acts in furtherance thereof, including without limitation, the
following:
(i)
Each
Administrator shall have the power, duty and authority, and is hereby
authorized, to act on behalf of the Trust with respect to the following
matters:
(A)
the
issuance and sale of the Securities;
(B)
to
acquire the Debentures with the proceeds of the sale of the Securities;
provided, however, that the Administrators shall cause legal title to the
Debentures to be held of record in the name of the Institutional Trustee for
the
benefit of the Holders;
(C)
to
cause
the Trust to enter into, and to execute, deliver and perform on behalf of the
Trust, such agreements as may be necessary or desirable in connection with
the
purposes and function of the Trust, including agreements with the Paying Agent,
a Debenture subscription agreement between the Trust and the Sponsor and a
Common Securities subscription agreement between the Trust and the
Sponsor;
(D)
ensuring
compliance with the Securities Act and applicable state securities or blue
sky
laws;
(E)
if
and at
such time determined solely by the Sponsor at the request of the Holders,
assisting in the designation of the Capital Securities for trading in the
Private Offering, Resales and Trading through the Automatic Linkages (“PORTAL”)
system if available;
(F)
the
sending of notices (other than notices of default) and other information
regarding the Securities and the Debentures to the Holders in accordance with
this Declaration, including notice of any notice received from the Debenture
Issuer of its election to defer payments of interest on the Debentures by
extending the interest payment period under the Indenture;
(G)
the
appointment of a Paying Agent, Calculation Agent, Transfer Agent and Registrar
in accordance with this Declaration;
(H)
execution
and delivery of the Securities in accordance with this Declaration;
(I)
execution
and delivery of closing certificates pursuant to the Placement Agreement and
the
application for a taxpayer identification number;
(J)
unless
otherwise determined by the Holders of a Majority in liquidation amount of
the
Securities or as otherwise required by the Statutory Trust Act, to execute
on
behalf of the Trust (either acting alone or together with any or all of the
Administrators) any documents that the Administrators have the power to execute
pursuant to this Declaration;
(K)
the
taking of any action incidental to the foregoing as the Sponsor or an
Administrator may from time to time determine is necessary or advisable to
give
effect to the terms of this Declaration for the benefit of the Holders (without
consideration of the effect of any such action on any particular
Holder);
(L)
to
establish a record date with respect to all actions to be taken hereunder that
require a record date be established, including Distributions, voting rights,
redemptions and exchanges, and to issue relevant notices to the Holders of
Capital Securities and Holders of Common Securities as to such actions and
applicable record dates;
(M)
to
duly
prepare and file on behalf of the Trust all applicable tax returns and tax
information reports that are required to be filed with respect to the
Trust;
(N)
so
long
as the Institutional Trustee for the benefit of the Trust is the holder of
the
Debentures, to cause any Statutory Financial Statements to be delivered to
the
Institutional Trustee and to each Holder and Cohen & Company promptly
following the filing of each such document with the relevant Applicable
Insurance Regulatory Authority. The delivery requirement set forth in the
preceding sentence may be satisfied by submitting the required Statutory
Financial Statements pursuant to Section 10.2(b) hereof.
(O)
to
negotiate the terms of, and the execution and delivery of, the Placement
Agreement and the Capital Securities Purchase Agreements related thereto
providing for the sale of the Capital Securities;
(P)
to
employ
or otherwise engage employees, agents (who may be designated as officers with
titles), managers, contractors, advisors, attorneys and consultants and pay
reasonable compensation for such services;
(Q)
to
incur
expenses that are necessary or incidental to carry out any of the purposes
of
the Trust;
(R)
to
give
the certificate required by § 314(a)(4) of the Trust Indenture Act to the
Institutional Trustee, which certificate may be executed by an Administrator;
and
(S)
to
take
all action that may be necessary or appropriate for the preservation and the
continuation of the Trust’s valid existence, rights, franchises and privileges
as a statutory trust under the laws of each jurisdiction (other than the State
of Delaware) in which such existence is necessary to protect the limited
liability of the Holders of the Capital Securities or to enable the Trust to
effect the purposes for which the Trust was created.
(ii)
As
among
the Trustees and the Administrators, the Institutional Trustee shall have the
power, duty and authority, and is hereby authorized, to act on behalf of the
Trust with respect to the following matters:
(A)
the
establishment of the Property 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 Property Account;
(D)
the
distribution through the Paying Agent of amounts owed to the Holders in respect
of the 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 Securities
and
the Debentures to the Holders in accordance with this Declaration;
(G)
the
distribution of the Trust Property in accordance with the terms of this
Declaration;
(H)
to
the
extent provided in this Declaration, 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
any
Event of Default (of which the Institutional Trustee has knowledge (as provided
in Section 2.10(m) hereof)) (
provided
,
that
such Event of Default is not by or with respect to the Institutional Trustee),
the taking of any action incidental to the foregoing as the Institutional
Trustee may from time to time determine is necessary or advisable to give effect
to the terms of this Declaration and protect and conserve the Trust Property
for
the benefit of the Holders (without consideration of the effect of any such
action on any particular Holder);
(J)
to
take
all action that may be necessary or appropriate for the preservation and the
continuation of the Trust’s valid existence, rights, franchises and privileges
as a statutory trust under the laws of the State of Delaware to protect the
limited liability of the Holders of the Capital Securities or to enable the
Trust to effect the purposes for which the Trust was created; and
(K)
to
undertake any actions set forth in § 317(a) of the Trust Indenture
Act.
(iii)
The
Institutional Trustee shall have the power and authority, and is hereby
authorized, to act on behalf of the Trust with respect to any of the duties,
liabilities, powers or the authority of the Administrators set forth in
Section 2.6(a)(i)(E) and (F) herein but shall not have a duty to do any
such act unless specifically requested to do so in writing by the Sponsor,
and
shall then be fully protected in acting pursuant to such written request; and
in
the event of a conflict between the action of the Administrators and the action
of the Institutional Trustee, the action of the Institutional Trustee shall
prevail.
(b)
So
long
as this Declaration remains in effect, the Trust (or the Trustees or
Administrators 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 Administrators may cause
the
Trust to (i) acquire any investments or engage in any activities not authorized
by this Declaration, (ii) sell, assign, transfer, exchange, mortgage, pledge,
set-off or otherwise dispose of any of the Trust Property or interests therein,
including to Holders, except as expressly provided herein, (iii) take any action
that would cause (or in the case of the Institutional Trustee, to the actual
knowledge of a Responsible Officer would cause) the Trust to fail or cease
to
qualify as a “grantor trust” for United States federal income tax purposes, (iv)
incur any indebtedness for borrowed money or issue any other debt or (v) take
or
consent to any action that would result in the placement of a lien on any of
the
Trust Property. The Institutional Trustee shall, at the sole cost and expense
of
the Trust, 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
Holders in their capacity as Holders.
(c)
In
connection with the issuance and sale of the Capital Securities, the Sponsor
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
Sponsor in furtherance of the following prior to the date of this Declaration
are hereby ratified and confirmed in all respects):
(i)
the
taking of any action necessary to obtain an exemption from the Securities
Act;
(ii)
the
determination of the jurisdictions in which to take appropriate action to
qualify or register for sale all or part of the Capital Securities and the
determination of any and all such acts, other than actions which must be taken
by or on behalf of the Trust, and the advisement of and direction to the
Trustees of actions they must take on behalf of the Trust, and the preparation
for execution and filing of any documents to be executed and filed by the Trust
or on behalf of the Trust, as the Sponsor deems necessary or advisable in order
to comply with the applicable laws of any such jurisdictions in connection
with
the sale of the Capital Securities; and
(iii)
the
taking of any other actions necessary or desirable to carry out any of the
foregoing activities.
(d)
Notwithstanding
anything herein to the contrary, the Administrators, the Institutional Trustee
and the Holders of a Majority in liquidation amount of the Common Securities
are
authorized and directed to conduct the affairs of the Trust and to operate
the
Trust so that (i) the Trust will not be deemed to be an “investment company”
required to be registered under the Investment Company Act (in the case of
the
Institutional Trustee, to the actual knowledge of a Responsible Officer), and
(ii) the Trust will not fail to be classified as a grantor trust for United
States federal income tax purposes (in the case of the Institutional Trustee,
to
the actual knowledge of a Responsible Officer) and (iii) the Trust will not
take
any action inconsistent with the treatment of the Debentures as indebtedness
of
the Debenture Issuer for United States federal income tax purposes (in the
case
of the Institutional Trustee, to the actual knowledge of a Responsible Officer).
In this connection, the Institutional Trustee, the Administrators and the
Holders of a Majority in liquidation amount of the Common Securities are
authorized to take any action, not inconsistent with applicable laws or this
Declaration, as amended from time to time, that each of the Institutional
Trustee, the Administrators and such Holders determine in their discretion
to be
necessary or desirable for such purposes, even if such action adversely affects
the interests of the Holders of the Capital Securities.
(e)
All
expenses incurred by the Administrators or the Trustees pursuant to this
Section 2.6 shall be reimbursed by the Sponsor, and the Trustees shall have
no obligations with respect to such expenses.
(f)
The
assets of the Trust shall consist of the Trust Property.
(g)
Legal
title to all Trust Property shall be vested at all times in the Institutional
Trustee (in its capacity as such) and shall be held and administered by the
Institutional Trustee for the benefit of the Trust in accordance with this
Declaration.
(h)
If
the
Institutional Trustee or any Holder has instituted any proceeding to enforce
any
right or remedy under this Declaration and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the
Institutional Trustee or to such Holder, then and in every such case the
Sponsor, the Institutional Trustee and the Holders shall, subject to any
determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of
the
Institutional Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION
2.7.
Prohibition
of Actions by the Trust and the Trustees
.
The
Trust
shall not, and the Institutional Trustee and the Administrators shall not,
and
the Administrators shall cause the Trust not to, engage in any activity other
than as required or authorized by this Declaration. In particular, the Trust
shall not, and the Institutional Trustee and the Administrators shall not cause
the Trust to:
(a)
invest
any proceeds received by the Trust from holding the Debentures, but shall
distribute all such proceeds to Holders of the Securities pursuant to the terms
of this Declaration and of the Securities;
(b)
acquire
any assets other than as expressly provided herein;
(c)
possess
Trust Property for other than a Trust purpose;
(d)
make
any
loans or incur any indebtedness other than loans represented by the
Debentures;
(e)
possess
any power or otherwise act in such a way as to vary the Trust Property or the
terms of the Securities;
(f)
issue
any
securities or other evidences of beneficial ownership of, or beneficial interest
in, the Trust other than the Securities; or
(g)
other
than as provided in this Declaration (including Annex I), (i) direct the time,
method and place of exercising any trust or power conferred upon the Debenture
Trustee with respect to the Debentures, (ii) waive any past default that is
waivable under the Indenture, (iii) exercise any right to rescind or annul
any
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 unless the Trust shall
have received a written opinion of counsel experienced in such matters to the
effect that such amendment, modification or termination will not cause the
Trust
to cease to be classified as a grantor trust for United States federal income
tax purposes.
SECTION
2.8.
Powers
and Duties of the Institutional Trustee
.
(a)
The
legal
title to the Debentures shall be owned by and held of record in the name of
the
Institutional Trustee in trust for the benefit of the Trust. The right, title
and interest of the Institutional Trustee to the Debentures shall vest
automatically in each Person who may hereafter be appointed as Institutional
Trustee in accordance with Section 4.7. Such vesting and transfer of title
shall be effective whether or not conveyancing documents with regard to the
Debentures have been executed and delivered.
(b)
The
Institutional Trustee shall not transfer its right, title and interest in the
Debentures to the Administrators or to the Delaware Trustee.
(c)
The
Institutional Trustee shall:
(i)
establish
and maintain a segregated non-interest bearing trust account (the “Property
Account”) in the United States (as defined in Treasury Regulations §
301.7701-7), in the name of and under the exclusive control of the Institutional
Trustee, and maintained in the Institutional Trustee’s trust department, on
behalf of the Holders of the Securities and, upon the receipt of payments of
funds made in respect of the Debentures held by the Institutional Trustee,
deposit such funds into the Property Account and make payments to the Holders
of
the Capital Securities and Holders of the Common Securities from the Property
Account in accordance with Section 5.1. Funds in the Property Account shall
be held uninvested until disbursed in accordance with this
Declaration;
(ii)
engage
in
such ministerial activities as shall be necessary or appropriate to effect
the
redemption of the Capital Securities and the Common Securities to the extent
the
Debentures are redeemed or mature; and
(iii)
upon
written notice of distribution issued by the Administrators in accordance with
the terms of the Securities, engage in such ministerial activities as shall
be
necessary or appropriate to effect the distribution of the Debentures to Holders
of Securities upon the occurrence of certain circumstances pursuant to the
terms
of the Securities.
(d)
The
Institutional Trustee shall take all actions and perform such duties as may
be
specifically required of the Institutional Trustee pursuant to the terms of
the
Securities.
(e)
The
Institutional Trustee may bring or defend, pay, collect, compromise, arbitrate,
resort to legal action with respect to, or otherwise adjust claims or demands
of
or against, the Trust (a “Legal Action”) which arise out of or in connection
with an Event of Default of which a Responsible Officer of the Institutional
Trustee has actual knowledge or the Institutional Trustee’s duties and
obligations under this Declaration or the Trust Indenture Act;
provided
,
however
,
that if
an Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay interest or premium,
if any, on or principal of the Debentures on the date such interest, premium,
if
any, or principal is otherwise due and payable (or in the case of redemption,
on
the redemption date), then a Holder of the Capital Securities may directly
institute a proceeding for enforcement of payment to such Holder of the
principal of or premium, if any, or interest on the Debentures having a
principal amount equal to the aggregate liquidation amount of the Capital
Securities of such Holder (a “Direct Action”) on or after the respective due
date (or, in the case of redemption, on the date of redemption) specified in
the
Debentures. In connection with such Direct Action, the rights of the Holders
of
the Common Securities will be subrogated to the rights of such Holder of the
Capital Securities to the extent of any payment made by the Debenture Issuer
to
such Holder of the Capital Securities in such Direct Action;
provided
,
however
,
that a
Holder of the Common Securities may exercise such right of subrogation only
if
no Event of Default with respect to the Capital Securities has occurred and
is
continuing.
(f)
The
Institutional Trustee shall continue to serve as a Trustee until
either:
(i)
the
Trust
has been completely liquidated and the proceeds of the liquidation distributed
to the Holders of the Securities pursuant to the terms of the Securities and
this Declaration (including Annex I) and the certificate of cancellation
referenced in Section 7.1(b) has been filed; or
(ii)
a
Successor Institutional Trustee has been appointed and has accepted that
appointment in accordance with Section 4.7.
(g)
The
Institutional Trustee shall have the legal power to exercise all of the rights,
powers and privileges of a holder of the Debentures under the Indenture and,
if
an Event of Default occurs and is continuing, the Institutional Trustee may,
for
the benefit of Holders of the Securities, enforce its rights as holder of the
Debentures subject to the rights of the Holders pursuant to this Declaration
(including Annex I) and the terms of the Securities.
(h)
The
Institutional Trustee must exercise the powers set forth in this
Section 2.8 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 2.3, and the Institutional Trustee shall
not take any action that is inconsistent with the purposes and functions of
the
Trust set out in Section 2.3.
SECTION
2.9.
Certain
Duties and Responsibilities of the Trustees and the
Administrators
.
(a)
The
Institutional Trustee, before the occurrence of any Event of Default (of which
such Event of Default the Institutional Trustee becomes aware thereof (as
provided in Section 2.10(m) hereof)) 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 Declaration and no implied covenants shall
be
read into this Declaration against the Institutional Trustee. In case an Event
of Default (of which the Institutional Trustee has knowledge (as provided in
Section 2.10(m) hereof)), has occurred (that has not been cured or waived
pursuant to Section 6.8), the Institutional Trustee shall exercise such of
the rights and powers vested in it by this Declaration, and use the same degree
of care and skill in their exercise, as a prudent person would exercise or
use
under the circumstances in the conduct of his or her own affairs.
(b)
The
duties and responsibilities of the Trustees and the Administrators shall be
as
provided by this Declaration and, in the case of the Institutional Trustee,
by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Declaration shall require any Trustee or Administrator to expend or risk its
own
funds or otherwise incur any financial liability in the performance of any
of
its duties hereunder, or in the exercise of any of its rights or powers, if
it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity satisfactory to it against such risk or liability is not
reasonably assured to it. Whether or not therein expressly so provided, every
provision of this Declaration relating to the conduct or affecting the liability
of or affording protection to the Trustees or the Administrators shall be
subject to the provisions of this Article. Nothing in this Declaration shall
be
construed to release a Trustee from liability for its own negligent action,
its
own negligent failure to act, or its own willful misconduct or bad faith.
Nothing in this Declaration shall be construed to release an Administrator
from
liability for its own gross negligent action, its own gross negligent failure
to
act, or its own willful misconduct or bad faith. To the extent that, at law
or
in equity, a Trustee or an Administrator has duties and liabilities relating
to
the Trust or to the Holders, such Trustee or Administrator shall not be liable
to the Trust or to any Holder for such Trustee’s or Administrator’s good faith
reliance on the provisions of this Declaration. The provisions of this
Declaration, to the extent that they restrict the duties and liabilities of
the
Administrators or the Trustees otherwise existing at law or in equity, are
agreed by the Sponsor and the Holders to replace such other duties and
liabilities of the Administrators or the Trustees.
(c)
All
payments made by the Institutional Trustee or a Paying Agent in respect of
the
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 Institutional Trustee or a Paying
Agent to make payments in accordance with the terms hereof. Each Holder, by
its
acceptance of a 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 the Trustees and the
Administrators are not personally liable to it for any amount distributable
in
respect of any Security or for any other liability in respect of any Security.
This Section 2.9(c) does not limit the liability of the Trustees expressly
set forth elsewhere in this Declaration or, in the case of the Institutional
Trustee, in the Trust Indenture Act.
(d)
No
provision of this Declaration shall be construed to relieve the Institutional
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct or bad faith with respect to matters
that
are within the authority of the Institutional Trustee under this Declaration,
except that:
(i)
the
Institutional Trustee shall not be liable for any error or judgment made in
good
faith by a Responsible Officer of the Institutional Trustee, unless it shall
be
proved that the Institutional Trustee was negligent in ascertaining the
pertinent facts;
(ii)
the
Institutional 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 or the Common Securities, as applicable, relating to the time, method
and place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under this Declaration;
(iii)
the
Institutional Trustee’s sole duty with respect to the custody, safe keeping and
physical preservation of the Debentures and the Property Account shall be to
deal with such property in a similar manner as the Institutional Trustee deals
with similar property for its own account, subject to the protections and
limitations on liability afforded to the Institutional Trustee under this
Declaration and the Trust Indenture Act;
(iv)
the
Institutional Trustee shall not be liable for any interest on any money received
by it except as it may otherwise agree in writing with the Sponsor; and money
held by the Institutional Trustee need not be segregated from other funds held
by it except in relation to the Property Account maintained by the Institutional
Trustee pursuant to Section 2.8(c)(í) and except to the extent otherwise
required by law; and
(v)
the
Institutional Trustee shall not be responsible for monitoring the compliance
by
the Administrators or the Sponsor with their respective duties under this
Declaration, nor shall the Institutional Trustee be liable for any default
or
misconduct or bad faith of the Administrators or the Sponsor.
SECTION
2.10.
Certain
Rights of Institutional Trustee
.
Subject
to the provisions of Section 2.9.
(a)
the
Institutional Trustee may conclusively rely and shall fully be protected in
acting or refraining from acting in good faith upon any resolution, written
opinion of counsel, certificate, written representation of a Holder or
transferee, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, direction, 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, sent or
presented by the proper party or parties;
(b)
if
(i) in
performing its duties under this Declaration, the Institutional Trustee is
required to decide between alternative courses of action, (ii) in construing
any
of the provisions of this Declaration, the Institutional Trustee finds the
same
ambiguous or inconsistent with any other provisions contained herein, or (iii)
the Institutional Trustee is unsure of the application of any provision of
this
Declaration, then, except as to any matter as to which the Holders of Capital
Securities are entitled to vote under the terms of this Declaration, the
Institutional Trustee may deliver a notice to the Sponsor requesting the
Sponsor’s opinion as to the course of action to be taken and the Institutional
Trustee shall take such action, or refrain from taking such action, as the
Institutional Trustee in its sole discretion shall deem advisable and in the
best interests of the Holders, in which event the Institutional Trustee shall
have no liability except for its own negligence or willful misconduct or bad
faith;
(c)
any
direction or act of the Sponsor or the Administrators contemplated by this
Declaration shall be sufficiently evidenced by an Officers’
Certificate;
(d)
whenever
in the administration of this Declaration, the Institutional Trustee shall
deem
it desirable that a matter be proved or established before undertaking,
suffering or omitting any action hereunder, the Institutional Trustee (unless
other evidence is herein specifically prescribed) may, in the absence of bad
faith on its part, request and conclusively rely upon an Officers’ Certificate
which, upon receipt of such request, shall be promptly delivered by the Sponsor
or the Administrators;
(e)
the
Institutional 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
Institutional Trustee may consult with counsel of its selection (which counsel
may be counsel to the Sponsor or any of its Affiliates) and the 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 and in accordance with such advice; the Institutional Trustee
shall have the right at any time to seek instructions concerning the
administration of this Declaration from any court of competent
jurisdiction;
(g)
the
Institutional Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Declaration at the request or direction of any
of
the Holders pursuant to this Declaration, unless such Holders shall have offered
to the Institutional Trustee security or indemnity reasonably satisfactory
to it
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction;
provided
,
that
nothing contained in this Section 2.10(g) shall be taken to relieve the
Institutional Trustee, upon the occurrence of an Event of Default (of which
the
Institutional Trustee has knowledge (as provided in Section 2.10(m)
hereof)) that has not been cured or waived, of its obligation to exercise the
rights and powers vested in it by this Declaration;
(h)
the
Institutional 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 Holders, but the Institutional
Trustee may make such further inquiry or investigation into such facts or
matters as it may see fit;
(i)
the
Institutional Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through its agents or
attorneys and the Institutional Trustee shall not be responsible for any
misconduct or bad faith or negligence on the part of, or for the supervision
of,
any such agent or attorney appointed with due care by it hereunder;
(j)
whenever
in the administration of this Declaration the Institutional Trustee shall deem
it desirable to receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Institutional Trustee (i) may
request instructions from the Holders of the Common Securities and the Capital
Securities, which instructions may be given only by the Holders of the same
proportion in liquidation amount of the Common Securities and the Capital
Securities as would be entitled to direct the Institutional Trustee under the
terms of the Common Securities and the Capital 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 fully protected in acting in accordance with such instructions;
(k)
except
as
otherwise expressly provided in this Declaration, the Institutional Trustee
shall not be under any obligation to take any action that is discretionary
under
the provisions of this Declaration;
(l)
when
the
Institutional Trustee incurs expenses or renders services in connection with
a
Bankruptcy Event, such expenses (including the fees and expenses of its counsel)
and the compensation for such services are intended to constitute expenses
of
administration under any bankruptcy law or law relating to creditors rights
generally;
(m)
the
Institutional Trustee shall not be charged with knowledge of an Event of Default
unless a Responsible Officer of the Institutional Trustee has actual knowledge
of such event or the Institutional Trustee receives written notice of such
event
from any Holder, except with respect to an Event of Default pursuant to Sections
5.01 (a) or 5.01 (b) of the Indenture (other than an Event of Default resulting
from the default in the payment of Additional Interest if the Institutional
Trustee does not have actual knowledge or written notice that such payment
is
due and payable), of which the Institutional Trustee shall be deemed to have
knowledge;
(n)
any
action taken by the Institutional Trustee or its agents hereunder shall bind
the
Trust and the Holders of the Securities, and the signature of the Institutional
Trustee or its agents alone shall be sufficient and effective to perform any
such action and no third party shall be required to inquire as to the authority
of the Institutional Trustee to so act or as to its compliance with any of
the
terms and provisions of this Declaration, both of which shall be conclusively
evidenced by the Institutional Trustee’s or its agent’s taking such action;
and
(o)
no
provision of this Declaration shall be deemed to impose any duty or obligation
on the Institutional 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 Institutional 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 Institutional Trustee shall
be
construed to be a duty.
SECTION
2.11.
Delaware
Trustee
.
Notwithstanding any other provision of this Declaration other than
Section 4.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of any of the Institutional Trustee or the Administrators
described in this Declaration (except as may be required under the Statutory
Trust Act). The Delaware Trustee shall have the same rights, privileges and
immunities as the Institutional Trustee. Except as set forth in
Section 4.2, the Delaware Trustee shall be a Trustee for the sole and
limited purpose of fulfilling the requirements of § 3807 of the Statutory Trust
Act and for taking such actions as are required to be taken by the Delaware
Trustee under the Statutory Trust Act. There shall be no other duties (including
fiduciary duties) or obligations, express or implied, at law or in equity,
of
the Delaware Trustee.
SECTION
2.12.
Execution
of Documents
.
Unless
otherwise determined in writing by the Institutional Trustee, and except as
otherwise required by the Statutory Trust Act, the Institutional Trustee, or
any
one or more of the Administrators, as the case may be, is authorized to execute
and deliver on behalf of the Trust any documents, agreements, instruments or
certificates that the Trustees or the Administrators, as the case may be, have
the power and authority to execute pursuant to Section 2.6.
SECTION
2.13.
Not
Responsible for Recitals or Issuance of Securities
.
The
recitals contained in this Declaration and the Securities shall be taken as
the
statements of the Sponsor, and the Trustees do not assume any responsibility
for
their correctness. The Trustees make no representations as to the value or
condition of the property of the Trust or any part thereof. The Trustees make
no
representations as to the validity or sufficiency of this Declaration, the
Debentures or the Securities.
SECTION
2.14.
Duration
of Trust
.
The
Trust, unless dissolved pursuant to the provisions of Article VII hereof, shall
have existence for thirty-five (35) years from the Closing Date.
SECTION
2.15.
Mergers
.
(a) The
Trust may not consolidate, amalgamate, merge 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 as described in this Section 2.15
and
except with respect to the distribution of Debentures to Holders of Securities
pursuant to Section 7.1(a)(iv) of the Declaration or Section 4 of Annex
I.
(b)
The
Trust
may, with the consent of the Administrators (which consent will not be
unreasonably withheld) and without the consent of the Institutional Trustee,
the
Delaware Trustee or the Holders of the Capital Securities, consolidate,
amalgamate, merge with or into, or be replaced by, or convey, transfer or lease
its properties and assets as an entirety or substantially as an entirety to
a
trust organized as such under the laws of any state;
provided
,
that:
(i)
if
the
Trust is not the survivor, such successor entity (the “Successor Entity”)
either:
(A)
expressly
assumes all of the obligations of the Trust under the Securities;
or
(B)
substitutes
for the Securities other securities having substantially the same terms as
the
Securities (the “Successor Securities”) so that the Successor Securities rank
the same as the Securities rank with respect to Distributions and payments
upon
Liquidation, redemption and otherwise;
(ii)
the
Sponsor expressly appoints, as the holder of the Common Securities, a trustee
of
the Successor Entity that possesses the same powers and duties as the
Institutional Trustee;
(iii)
the
Capital Securities or any Successor Securities (excluding any securities
substituted for the Common Securities) are listed or quoted, or any Successor
Securities will be listed or quoted upon notification of issuance, on any
national securities exchange or with another organization on which the Capital
Securities are then listed or quoted, if any;
(iv)
such
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease
does not cause the rating, if any, on the Capital Securities (including any
Successor Securities) to be downgraded or withdrawn by any nationally recognized
statistical rating organization, if the Capital Securities are then
rated;
(v)
such
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease
does not adversely affect the rights, preferences and privileges of the Holders
of the Securities (including any Successor Securities) in any material respect
(other than with respect to any dilution of such Holders’ interests in the
Successor Entity as a result of such merger, consolidation, amalgamation or
replacement);
(vi)
such
Successor Entity has a purpose substantially identical to that of the
Trust;
(vii)
prior
to
such merger, consolidation, amalgamation, replacement, conveyance, transfer
or
lease, the Trust has received a written opinion of a nationally recognized
independent counsel to the Trust experienced in such matters to the effect
that:
(A)
such
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease
does not adversely affect the rights, preferences and privileges of the Holders
of the Securities (including any Successor Securities) in any material respect
(other than with respect to any dilution of the Holders’ interests in the
Successor Entity);
(B)
following
such merger, consolidation, amalgamation, replacement, conveyance, transfer
or
lease, neither the Trust nor the Successor Entity will be required to register
as an Investment Company; and
(C)
following
such merger, consolidation, amalgamation, replacement, conveyance, transfer
or
lease, the Trust (or the Successor Entity) will continue to be classified as
a
grantor trust for United States federal income tax purposes;
(viii)
the
Sponsor guarantees the obligations of such Successor Entity under the Successor
Securities to the same extent provided by the Guarantee, the Debentures and
this
Declaration; and
(ix)
prior
to
such merger, consolidation, amalgamation, replacement, conveyance, transfer
or
lease, the Institutional Trustee shall have received an Officers’ Certificate of
the Administrators and an opinion of counsel, each to the effect that all
conditions precedent of this paragraph (b) to such transaction have been
satisfied.
(c)
Notwithstanding
Section 2.15(b), the Trust shall not, except with the consent of Holders of
100% in liquidation amount of the Securities, consolidate, amalgamate, merge
with or into, or be replaced by, or convey, transfer or lease its properties
and
assets as an entirety or substantially as an entirety to, any other Person
or
permit any other Person to consolidate, amalgamate, merge with or into, or
replace it if such consolidation, amalgamation, merger, replacement, conveyance,
transfer or lease would cause the Trust or Successor Entity to be classified
as
other than a grantor trust for United States federal income tax
purposes.
ARTICLE
III.
SPONSOR
SECTION
3.1.
Sponsor’s
Purchase of Common Securities
.
On the
Closing Date, the Sponsor will purchase all of the Common Securities issued
by
the Trust, in an amount at least equal to 3% of the capital of the Trust, at
the
same time as the Capital Securities are sold.
SECTION
3.2.
Responsibilities
of the Sponsor
.
In
connection with the issue and sale of the Capital Securities, the Sponsor shall
have the exclusive right and responsibility and sole decision to engage in,
or
direct the Administrators to engage in, the following activities:
(a)
to
determine the States in which to take appropriate action to qualify or register
for sale of all or part of the Capital Securities and to do any and all such
acts, other than actions which must be taken by the Trust, and advise the Trust
of actions it must take, and prepare for execution and filing any documents
to
be executed and filed by the Trust, as the Sponsor deems necessary or advisable
in order to comply with the applicable laws of any such States;
(b)
to
prepare for filing and request the Administrators to cause the filing by the
Trust, as may be appropriate, of an application to the PORTAL system, for
listing or quotation upon notice of issuance of any Capital Securities, as
requested by the Holders of not less than a Majority in liquidation amount
of
the Capital Securities; and
(c)
to
negotiate the terms of and/or execute and deliver on behalf of the Trust, the
Placement Agreement and other related agreements providing for the sale of
the
Capital Securities.
ARTICLE
IV.
TRUSTEES
AND ADMINISTRATORS
SECTION
4.1.
Number
of Trustees
.
The
number of Trustees initially shall be two, and:
(a)
at
any
time before the issuance of any Securities, the Sponsor may, by written
instrument, increase or decrease the number of Trustees; and
(b)
after
the
issuance of any Securities, the number of Trustees may be increased or decreased
by vote of the Holder of a Majority in liquidation amount of the Common
Securities voting as a class at a meeting of the Holder of the Common
Securities;
provided
,
however
,
that
there shall be a Delaware Trustee if required by Section 4.2; and there
shall always be one Trustee who shall be the Institutional Trustee, and such
Trustee may also serve as Delaware Trustee if it meets the applicable
requirements, in which case Section 2.11 shall have no application to such
entity in its capacity as Institutional Trustee.
SECTION
4.2.
Delaware
Trustee
.
If
required by the Statutory Trust Act, one Trustee (the “Delaware Trustee”) shall
be:
(a)
a
natural
person who is a resident of the State of Delaware; or
(b)
if
not a
natural person, an entity which is organized under the laws of the United States
or any state thereof or the District of Columbia, has its principal place of
business in the State of Delaware, and otherwise meets the requirements of
applicable law, including §3807 of the Statutory Trust Act.
SECTION
4.3.
Institutional
Trustee; Eligibility.
(a)
There
shall at all times be one Trustee which shall act as Institutional Trustee
which
shall:
(i)
not
be an
Affiliate of the Sponsor;
(ii)
not
offer
or provide credit or credit enhancement to the Trust; and
(iii)
be
a
banking corporation or national association organized and doing business under
the laws of the United States of America or any state thereof or of the District
of Columbia and authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least fifty million U.S. dollars
($50,000,000), and subject to supervision or examination by federal, state
or
District of Columbia authority. If such corporation or national association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority referred to above, then
for the purposes of this Section 4.3(a)(iii), the combined capital and
surplus of such corporation or national association shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published.
(b)
If
at any
time the Institutional Trustee shall cease to be eligible to so act under
Section 4.3(a), the Institutional Trustee shall immediately resign in the
manner and with the effect set forth in Section 4.7.
(c)
If
the
Institutional Trustee has or shall acquire any “conflicting interest” within the
meaning of § 310(b) of the Trust Indenture Act, the Institutional Trustee shall
either eliminate such interest or resign, to the extent and in the manner
provided by, and subject to this Declaration.
(d)
The
initial Institutional Trustee shall be The Bank of New York Trust Company,
National Association.
SECTION
4.4.
Certain
Qualifications of the Delaware Trustee Generally
.
The
Delaware Trustee shall be a U.S. Person and either a natural person who is
at
least 21 years of age or a legal entity that shall act through one or more
Authorized Officers.
SECTION
4.5.
Administrators
.
Each
Administrator shall be a U.S. Person.
There
shall at all times be at least one Administrator. Except where a requirement
for
action by a specific number of Administrators is expressly set forth in this
Declaration and except with respect to any action the taking of which is the
subject of a meeting of the Administrators, any action required or permitted
to
be taken by the Administrators may be taken by, and any power of the
Administrators may be exercised by, or with the consent of, any one such
Administrator acting alone.
SECTION
4.6.
Initial
Delaware Trustee
.
The
initial Delaware Trustee shall be The Bank of New York (Delaware).
SECTION
4.7.
Appointment,
Removal and Resignation of the Trustees and the Administrators
.
(a)
No
resignation or removal of any Trustee (the “Relevant Trustee”) and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of this
Section 4.7.
(b)
Subject
to Section 4.7(a), a Relevant Trustee may resign at any time by giving
written notice thereof to the Holders of the Securities and by appointing a
successor Relevant Trustee, except in the case of the Delaware Trustee’s
successor which shall be appointed by Holders of a Majority in liquidation
amount of the Common Securities. Upon the resignation of the Institutional
Trustee, the Institutional Trustee shall appoint a successor by requesting
from
at least three Persons meeting the eligibility requirements their expenses
and
charges to serve as the successor Institutional Trustee on a form provided
by
the Administrators, and selecting the Person who agrees to the lowest reasonable
expense and charges (the “Successor Institutional Trustee”). If the instrument
of acceptance by the successor Relevant Trustee required by this
Section 4.7 shall not have been delivered to the Relevant Trustee within 60
days after the giving of such notice of resignation or delivery of the
instrument of removal, the Relevant Trustee may petition, at the expense of
the
Trust, any federal, state or District of Columbia court of competent
jurisdiction for the appointment of a successor Relevant Trustee. Such court
may
thereupon, after prescribing such notice, if any, as it may deem proper, appoint
a Relevant Trustee. The Institutional Trustee shall have no liability for the
selection of such successor pursuant to this Section 4.7.
(c)
Unless
an
Event of Default shall have occurred and be continuing, any Trustee may be
removed at any time by an act of the Holders of a Majority in liquidation amount
of the Common Securities. If any Trustee shall be so removed, the Holders of
the
Common Securities, by act of the Holders of a Majority in liquidation amount
of
the Common Securities delivered to the Relevant Trustee, shall promptly appoint
a successor Relevant Trustee, and such successor Relevant Trustee shall comply
with the applicable requirements of this Section 4.7. If an Event of
Default shall have occurred and be continuing, the Institutional Trustee or
the
Delaware Trustee, or both of them, may be removed by the act of the Holders
of a
Majority in liquidation amount of the Capital Securities, delivered to the
Relevant Trustee (in its individual capacity and on behalf of the Trust). If
any
Trustee shall be so removed, the Holders of Capital Securities, by act of the
Holders of a Majority in liquidation amount of the Capital Securities then
outstanding delivered to the Relevant Trustee, shall promptly appoint a
successor Relevant Trustee or Trustees, and such successor Relevant Trustee
shall comply with the applicable requirements of this Section 4.7. If no
successor Relevant Trustee shall have been so appointed by the Holders of a
Majority in liquidation amount of the Capital Securities and accepted
appointment in the manner required by this Section 4.7 within 30 days after
delivery of an instrument of removal, the Relevant Trustee or any Holder who
has
been a Holder of the Securities for at least six months may, on behalf of
himself and all others similarly situated, petition any federal, state or
District of Columbia court of competent jurisdiction for the appointment of
a
successor Relevant Trustee. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper, appoint a successor Relevant Trustee
or
Trustees.
(d)
The
Institutional Trustee shall give notice of each resignation and each removal
of
a Trustee and each appointment of a successor Trustee to all Holders and to
the
Sponsor. Each notice shall include the name of the successor Relevant Trustee
and the address of its Corporate Trust Office if it is the Institutional
Trustee.
(e)
Notwithstanding
the foregoing or any other provision of this Declaration, in the event a
Delaware Trustee who is a natural person dies or is adjudged by a court to
have
become incompetent or incapacitated, the vacancy created by such death,
incompetence or incapacity may be filled by the Institutional Trustee (provided
the Institutional Trustee satisfies the requirements of a Delaware Trustee
as
set forth in Section 4.2) following the procedures in this Section 4.7
(with the successor being a Person who satisfies the eligibility requirement
for
a Delaware Trustee set forth in this Declaration) (the “Successor Delaware
Trustee”).
(f)
In
case
of the appointment hereunder of a successor Relevant Trustee, the retiring
Relevant Trustee and each successor Relevant Trustee with respect to the
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 Securities and
the
Trust and (b) shall add to or change any of the provisions of this Declaration
as shall be necessary to provide for or facilitate the administration of the
Trust by more than one Relevant Trustee, it being understood that nothing herein
or in such amendment shall constitute such Relevant Trustees co-trustees 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; 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 Securities and the Trust subject to the payment of all unpaid
fees, expenses and indemnities of such retiring Relevant Trustee.
(g)
No
Institutional Trustee or Delaware Trustee shall be liable for the acts or
omissions to act of any Successor Institutional Trustee or Successor Delaware
Trustee, as the case may be.
(h)
The
Holders of the Capital Securities will have no right to vote to appoint, remove
or replace the Administrators, which voting rights are vested exclusively in
the
Holders of the Common Securities.
(i)
Any
successor Delaware Trustee shall file an amendment to the Certificate of Trust
with the Secretary of State of the State of Delaware identifying the name and
principal place of business of such Delaware Trustee in the State of
Delaware.
SECTION
4.8.
Vacancies
Among Trustees
.
If a
Trustee ceases to hold office for any reason and the number of Trustees is
not
reduced pursuant to Section 4.1, or if the number of Trustees is increased
pursuant to Section 4.1, a vacancy shall occur. A resolution certifying the
existence of such vacancy by the Trustees or, if there are more than two, a
majority of the Trustees shall be conclusive evidence of the existence of such
vacancy. The vacancy shall be filled with a Trustee appointed in accordance
with
Section 4.7.
SECTION
4.9.
Effect
of Vacancies
.
The
death, resignation, retirement, removal, bankruptcy, dissolution, liquidation,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to dissolve, terminate or annul the Trust or terminate this Declaration.
Whenever a vacancy in the number of Trustees shall occur, until such vacancy
is
filled by the appointment of a Trustee in accordance with Section 4.7, the
Institutional Trustee shall have all the powers granted to the Trustees and
shall discharge all the duties imposed upon the Trustees by this
Declaration.
SECTION
4.10.
Meetings
of the Trustees and the Administrators
.
Meetings of the Trustees or the Administrators shall be held from time to time
upon the call of any Trustee or Administrator, as applicable. Regular meetings
of the Trustees and the Administrators, respectively, may be in person in the
United States or by telephone, at a place (if applicable) and time fixed by
resolution of the Trustees or the Administrators, as applicable. Notice of
any
in-person meetings of the Trustees or the Administrators shall be hand delivered
or otherwise delivered in writing (including by facsimile, with a hard copy
by
overnight courier) not less than 48 hours before such meeting. Notice of any
telephonic meetings of the Trustees or the Administrators or any committee
thereof shall be hand delivered or otherwise delivered in writing (including
by
facsimile, with a hard copy by overnight courier) not less than 24 hours before
a meeting. Notices shall contain a brief statement of the time, place and
anticipated purposes of the meeting. The presence (whether in person or by
telephone) of a Trustee or an Administrator, as the case may be, at a meeting
shall constitute a waiver of notice of such meeting except where a Trustee
or an
Administrator, as the case may be, attends a meeting for the express purpose
of
objecting to the transaction of any activity on the ground that the meeting
has
not been lawfully called or convened. Unless provided otherwise in this
Declaration, any action of the Trustees or the Administrators, as the case
may
be, may be taken at a meeting by vote of a majority of the Trustees or the
Administrators present (whether in person or by telephone) and eligible to
vote
with respect to such matter;
provided
,
that,
in the case of the Administrators, a Quorum is present, or without a meeting
by
the unanimous written consent of the Trustees or the Administrators, as the
case
may be. Meetings of the Trustees and the Administrators together shall be held
from time to time upon the call of any Trustee or Administrator.
SECTION
4.11.
Delegation
of Power
.
(a) Any
Trustee or any Administrator, as the case may be, may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 that is a U.S. Person his or her power for the purpose of executing
any documents, instruments or other writings contemplated in
Section 2.6.
(b)
The
Trustees shall have power to delegate from time to time to such of their number
or to any officer of the Trust that is a U.S. Person, the doing of such things
and the execution of such instruments or other writings either in the name
of
the Trust or the names of the Trustees or otherwise as the Trustees may deem
expedient, to the extent such delegation is not prohibited by applicable law
or
contrary to the provisions of the Trust, as set forth herein.
SECTION
4.12.
Merger,
Conversion, Consolidation or Succession to Business
.
Any
Person into which the Institutional Trustee or the Delaware Trustee, as the
case
maybe, may be merged or converted or with which either may be consolidated,
or
any Person resulting from any merger, conversion or consolidation to which
the
Institutional Trustee or the Delaware Trustee, as the case may be, shall be
a
party, or any Person succeeding to all or substantially all the corporate trust
business of the Institutional Trustee or the Delaware Trustee, as the case
may
be, shall be the successor of the Institutional Trustee or the Delaware Trustee,
as the case may be, hereunder, without the execution or filing of any paper
or
any further act on the part of any of the parties hereto, provided such Person
shall be otherwise qualified and eligible under this Article and, provided,
further, that such Person shall file an amendment to the Certificate of Trust
with the Secretary of State of the State of Delaware as contemplated in
Section 4.7(i).
ARTICLE
V.
DISTRIBUTIONS
SECTION
5.1.
Distributions
.
(a)
Holders
shall receive Distributions in accordance with the applicable terms of the
relevant Holder’s Securities. Distributions shall be made on the Capital
Securities and the Common Securities in accordance with the preferences set
forth in their respective terms. If and to the extent that the Debenture Issuer
makes a payment of interest (including any Additional Interest or Deferred
Interest) or premium, if any, on and/or principal on the Debentures held by
the
Institutional Trustee (the amount of any such payment being a “Payment Amount”),
the Institutional Trustee shall and is directed, to the extent funds are
available in the Property Account for that purpose, to make a distribution
(a
“Distribution”) of the Payment Amount to Holders. For the avoidance of doubt,
funds in the Property Account shall not be distributed to Holders to the extent
of any taxes payable by the Trust, in the case of withholding taxes, as
determined by the Institutional Trustee or any Paying Agent and, in the case
of
taxes other than withholding tax taxes, as determined by the Administrators
in a
written notice to the Institutional Trustee.
(b)
As
a
condition to the payment of any principal of or interest on the Securities
without the imposition of withholding tax, the Administrators shall require
the
previous delivery of properly completed and signed applicable U.S. federal
income tax certifications (generally, an Internal Revenue Service Form W-9
(or
applicable successor form) in the case of a Person that is a “United States
person” within the meaning of Section 7701(a)(30) of the Code or an
Internal Revenue Service Form W-8BEN (or applicable successor form) in the
case
of a Person that is not a “United States person” within the meaning of
Section 7701(a)(30) of the Code) and any other certification acceptable to
it to enable the Institutional Trustee or any Paying Agent to determine their
respective duties and liabilities with respect to any taxes or other charges
that they may be required to pay, deduct or withhold in respect of such
Securities.
ARTICLE
VI.
ISSUANCE
OF SECURITIES
SECTION
6.1.
General
Provisions Regarding Securities
.
(a)
The
Administrators shall on behalf of the Trust issue one series of capital
securities, evidenced by a certificate substantially in the form of
Exhibit A-1, representing undivided beneficial interests in the assets of
the Trust and having such terms as are set forth in Annex I (the “Capital
Securities”), and one series of common securities, evidenced by a certificate
substantially in the form of Exhibit A-2, representing undivided beneficial
interests in the assets of the Trust and having such terms as are set forth
in
Annex I (the “Common Securities”). The Trust shall issue no securities or other
interests in the assets of the Trust other than the Capital Securities and
the
Common Securities. The Capital Securities rank
pari
passu
and
payment thereon shall be made Pro Rata with the Common Securities except that,
where an Event of Default has occurred and is continuing, the rights of Holders
of the Common Securities to payment in respect of Distributions and payments
upon liquidation, redemption and otherwise are subordinated to the rights to
payment of the Holders of the Capital Securities.
(b)
The
Certificates shall be signed on behalf of the Trust by one or more
Administrators. Such signature shall be the facsimile or manual signature of
any
Administrator. In case any Administrator of the Trust who shall have signed
any
of the Securities shall cease to be such Administrator before the Certificates
so signed shall be delivered by the Trust, such Certificates nevertheless may
be
delivered as though the person who signed such Certificates had not ceased
to be
such Administrator. Any Certificate may be signed on behalf of the Trust by
such
person who, at the actual date of execution of such Security, shall be an
Administrator of the Trust, although at the date of the execution and delivery
of the Declaration any such person was not such an Administrator. A Capital
Security shall not be valid until authenticated by the manual signature of
an
Authorized Officer of the Institutional Trustee. Such signature shall be
conclusive evidence that the Capital Security has been authenticated under
this
Declaration. Upon written order of the Trust signed by one Administrator, the
Institutional Trustee shall authenticate the Capital Securities for original
issue. The Institutional Trustee may appoint an authenticating agent that is
a
U.S. Person acceptable to the Trust to authenticate the Capital Securities.
A
Common Security need not be so authenticated and shall be valid upon execution
by one or more Administrators.
(c)
The
consideration received by the Trust for the issuance of the Securities shall
constitute a contribution to the capital of the Trust and shall not constitute
a
loan to the Trust.
(d)
Upon
issuance of the Securities as provided in this Declaration, the Securities
so
issued shall be deemed to be validly issued, fully paid and non-assessable,
and
each Holder thereof shall be entitled to the benefits provided by this
Declaration.
(e)
Every
Person, by virtue of having become a Holder in accordance with the terms of
this
Declaration, shall be deemed to have expressly assented and agreed to the terms
of, and shall be bound by, this Declaration and the Guarantee.
(f)
The
Capital Securities issued to Persons that are both (x) QPs and (y) QIBs pursuant
to a private placement exemption from the Securities Act may be, except as
provided in Section 6.4, Book-Entry Capital Securities issued in the form
of one or more Rule 144A Global Capital Securities registered in the name of
the
Depositary, or its nominee and deposited with the Depositary or a custodian
for
the Depositary for credit by the Depositary to the respective accounts of the
Depositary Participants thereof (or such other accounts as they may direct),
duly executed by the Trust and authenticated by the Institutional Trustee as
herein provided. The aggregate principal amount of the Rule 144A Global Capital
Securities may from time to time be increased or decreased by adjustments made
on the records of the Depositary, its custodian or its nominee, as the case
may
be, as hereinafter provided.
(g)
The
Capital Securities offered and sold to Persons that are both non-U.S. Persons
and non-U.S. Residents in offshore transactions in reliance on Regulation S
may
be, except as provided in Section 6.4, Book-Entry Capital Securities issued
in the form of one or more Regulation S Global Capital Securities, registered
in
the name of the Depositary, or its nominee and deposited with the Depositary
or
a custodian for the Depositary for credit by the Depositary to the respective
accounts of the Depositary Participants thereof (or such other accounts as
they
may direct), duly executed by the Trust and authenticated by the Institutional
Trustee as herein provided. The aggregate principal amount of the Regulation
S
Global Capital Securities may from time to time be increased or decreased by
adjustments made on the records of the Depositary, its custodian or its nominee,
as the case may be, as hereinafter provided.
(h)
The
Capital Securities, including the Certificates of Authentication, shall be
in
substantially the forms required by this Article VI and Exhibit A-1 and A-2,
with such appropriate insertions and variations as are required or permitted
by
this Declaration, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon, as may be
consistent herewith, determined by authorized officers of the Sponsor as
evidenced by their execution of such Capital Securities.
(i)
The
Capital Securities issued to a Person other than (i)
QIB/QP
or
(ii) Persons that are both non-U.S. Persons and non-U.S. Residents in offshore
transactions in reliance on Regulation S
shall be
issued in the form of Definitive Capital Securities Certificates.
SECTION
6.2.
Paying
Agent, Transfer Agent, Calculation Agent and Registrar
.
(a)
The
Trust
shall maintain in New York, New York, an office or agency where the Securities
may be presented for payment (the “Paying Agent”), and an office or agency where
Securities may be presented for registration of transfer or exchange (the
“Transfer Agent”). The Trust shall keep or cause to be kept at such office or
agency a register for the purpose of registering Securities and transfers and
exchanges of Securities, such register to be held by a registrar (the
“Registrar”). The Administrators may appoint the Paying Agent, the Registrar and
the Transfer Agent, and may appoint one or more additional Paying Agents, one
or
more co-Registrars, or one or more co-Transfer Agents in such other locations
as
it shall determine. The term “Paying Agent” includes any additional Paying
Agent, the term “Registrar” includes any additional Registrar or co-Registrar
and the term “Transfer Agent” includes any additional Transfer Agent or
co-Transfer Agent. The Administrators may change any Paying Agent, Transfer
Agent or Registrar at any time without prior notice to any Holder. The
Administrators shall notify the Institutional Trustee of the name and address
of
any Paying Agent, Transfer Agent and Registrar not a party to this Declaration.
The Administrators hereby initially appoint the Institutional Trustee to act
as
Paying Agent, Transfer Agent and Registrar for the Capital Securities and the
Common Securities at its Corporate Trust Office. The Institutional Trustee
or
any of its Affiliates in the United States may act as Paying Agent, Transfer
Agent or Registrar.
(b)
The
Trust
shall also appoint a Calculation Agent, which shall determine the Coupon Rate
in
accordance with the terms of the Securities. The Trust initially appoints the
Institutional Trustee as Calculation Agent.
SECTION
6.3.
Form
and Dating
.
(a)
The
Capital Securities and the Institutional Trustee’s certificate of authentication
thereon shall be substantially in the form of Exhibit A-1, and the Common
Securities shall be substantially in the form of Exhibit A-2, each of which
is
hereby incorporated in and expressly made a part of this Declaration.
Certificates may be typed, printed, lithographed or engraved or may be produced
in any other manner as is reasonably acceptable to the Administrators, as
conclusively evidenced by their execution thereof. The Securities may have
letters, numbers, notations or other marks of identification or designation
and
such legends or endorsements required by law, stock exchange rule, agreements
to
which the Trust is subject, if any, or usage (provided, that any such notation,
legend or endorsement is in a form acceptable to the Sponsor). The Trust at
the
direction of the Sponsor shall furnish any such legend not contained in Exhibit
A-1 to the Institutional Trustee in writing. Each Capital Security shall be
dated the date of its authentication. The terms and provisions of the Securities
set forth in Annex I and the forms of Securities set forth in Exhibits A-1
and
A-2 are part of the terms of this Declaration and to the extent applicable,
the
Institutional Trustee, the Delaware Trustee, the Administrators and the Sponsor,
by their execution and delivery of this Declaration, expressly agree to such
terms and provisions and to be bound thereby. Capital Securities will be issued
only in blocks having an aggregate liquidation amount of not less than
$100,000.
(b)
The
Capital Securities are being offered and sold by the Trust pursuant to the
Placement Agreement and the Capital Securities Purchase Agreements in book-entry
form, registered in the name of Cede & Co., as nominee on behalf of the
Depository Trust Company, without coupons and with the Restricted Securities
Legend.
SECTION
6.4.
Book-Entry
Capital Securities
.
(a)
A
Global
Capital Security may be exchanged, in whole or in part, for Definitive Capital
Securities Certificates registered in the names of the Owners only if such
exchange complies with
Section 6.4
and
(i) the Depositary advises the Administrators and the Institutional Trustee
in writing that the Depositary is no longer willing or able properly to
discharge its responsibilities with respect to the Global Capital Security,
and
no qualified successor is appointed by the Administrators within ninety (90)
days of receipt of such notice, (ii) the Depositary ceases to be a clearing
agency registered under the Exchange Act and the Administrators fail to appoint
a qualified successor within ninety (90) days of obtaining knowledge of such
event, (iii) the Administrators at their option advise the Institutional Trustee
in writing that the Trust elects to terminate the book-entry system through
the
Depositary or (iv) a Debenture Event of Default has occurred and is
continuing. Upon the occurrence of any event specified in clause (i), (ii),
(iii) or (iv) above, the Administrators shall notify the Depositary and instruct
the Depositary to notify all Owners of Book-Entry Capital Securities, the
Delaware Trustee and the Institutional Trustee of the occurrence of such event
and of the availability of the Definitive Capital Securities Certificates to
Owners of the Capital Securities requesting the same. Upon the issuance of
Definitive Capital Securities Certificates, the Trustees shall recognize the
Holders of the Definitive Capital Securities Certificates as Holders.
Notwithstanding the foregoing, if an Owner of a beneficial interest in a Global
Capital Security wishes at any time to transfer an interest in such Global
Capital Security to a Person other than a QIB
/QP
,
such
transfer shall be effected, subject to the Applicable Depositary Procedures,
in
accordance with the provisions of this
Section 6.4
and
Section 8.1
,
and the
transferee shall receive a Definitive Capital Securities Certificate in
connection with such transfer. A holder of a Definitive Capital Securities
Certificate that is a QIB
/QP
may,
upon
request and in accordance with the provisions of this
Section 6.4
and
Section 8.1
,
exchange such Definitive Capital Securities Certificate for a beneficial
interest in a Global Capital Security.
(b)
Notwithstanding
any provision to the contrary herein, so long as a Global Capital Security
remains Outstanding and is held by or on behalf of the Depositary, transfers
of
a Global Capital Security or any interest therein, in whole or in part, shall
only be made in accordance with this Article VI.
(i)
Transfers,
Exchanges and Cancellations Generally
.
If
(A)
any
Global Capital Security is to be exchanged
or
transferred
for
Definitive Capital Securities Certificates or canceled in part, or
(B)
any
Definitive Capital Securities Certificate is to be exchanged in whole or in
part
for any Global Capital Security, then (i) such Global Capital
Security
,
in the
case of clause (A), or such Definitive Capital Securities Certificate, in the
case of clause (B),
shall be
so surrendered for exchange, transfer or cancellation as provided in this
Article
VI
,
(ii)
the aggregate liquidation amount represented by such Global Capital Security
shall be reduced, subject to
Section 6.4
,
or
increased by an amount equal to
(x)
the
liquidation amount represented by that portion of the Global Capital Security
to
be
so
exchanged, transferred or canceled, or (y) the liquidation amount represented
by
such Definitive Capital Securities Certificates to be so exchanged for a
beneficial interest in any Global Capital Security, as the case may be, by
means
of an appropriate adjustment made on the records of the Securities Registrar,
whereupon the Institutional Trustee, in accordance with the Applicable
Depositary Procedures, shall instruct the Depositary or its authorized
representative to make a corresponding adjustment to its records and (iii)
such
transaction shall be subject to the additional provisions set forth herein.
Upon
any such surrender to the Administrators or the Securities Registrar of any
Global Capital Security(ies) by the Depositary, accompanied by registration
instructions, the Administrators, or any one of them, shall execute the
Definitive Capital Securities Certificates, and the Institutional Trustee shall
authenticate and deliver any Definitive Capital Securities Certificates issuable
in exchange for such Global Capital Security(ies) (or any portion thereof),
in
accordance with the instructions of the Depositary. None of the Registrar or
the
Trustees shall be liable for any delay in delivery of such instructions and
may
conclusively rely on, and shall be fully protected in relying on, such
instructions.
(ii)
Rule
144A Global Capital Security to Regulation S Global Capital
Security
.
If an
Owner of a beneficial interest in a Rule 144A Global Capital Security deposited
with the Depositary wishes at any time to exchange its interest in such Rule
144A Global Capital Security for an interest in the corresponding Regulation
S
Global Capital Security, or to transfer its interest in such Rule 144A Global
Capital Security to a Person who wishes to take delivery thereof in the form
of
an interest in the corresponding Regulation S Global Capital Security, such
Owner, provided such Owner or, in the case of a transfer to another Person,
such
Person is not a U.S. Person or a U.S. Resident, may, subject to the immediately
succeeding sentence and the rules and procedures of the Depositary, exchange
or
transfer or cause the exchange or transfer of such interest for an equivalent
beneficial interest in the Regulation S Global Capital Security. Upon receipt
by
the Institutional Trustee, as Registrar, of (A) instructions given in accordance
with the Depositary’s procedures from an Agent Member (as hereinafter defined)
directing the Institutional Trustee to cause to be credited a beneficial
interest in the Regulation S Global Capital Security in an amount equal to
the
beneficial interest in the Rule 144A Global Capital Security to be exchanged
or
transferred, but not less than the minimum denomination applicable to Securities
held through Regulation S Global Capital Securities, (B) a written order given
in accordance with the Depositary’s procedures containing information regarding
the participant account of the Depositary and, in the case of a transfer or
exchange pursuant to and in accordance with Regulation S, the account to be
credited with such increase and (C) a certificate in the form of
Exhibit
E
attached
hereto, given by the Owner of such beneficial interest (in the case of an
exchange) or the transferee of such beneficial interest (in the case of a
transfer) stating that the exchange or transfer of such interest has been made
in compliance with the transfer restrictions applicable to the Global Capital
Securities, including in accordance with Regulation S, the Institutional
Trustee, as Registrar, shall instruct the Depositary to reduce the principal
amount of the Rule 144A Global Capital Security and to increase the principal
amount of the Regulation S Global Capital Security by the aggregate principal
amount of the beneficial interest in the Rule 144A Global Capital Security
to be
exchanged or transferred, and to credit or cause to be credited to the account
of the Person specified in such instructions a beneficial interest in the
Regulation S Global Capital Security equal to the reduction in the principal
amount of the Rule 144A Global Capital Security.
(iii)
Regulation
S Global Capital Security to Rule 144A Global Capital Security.
If
an
Owner of a beneficial interest in a Regulation S Global Capital Security
deposited with the Depositary wishes at any time to exchange its interest in
such Regulation S Global Capital Security for an interest in a corresponding
Rule 144A Global Capital Security or to transfer its interest in such Regulation
S Global Capital Security to a Person who wishes to take delivery thereof in
the
form of an interest in the corresponding Rule 144A Global Capital Security,
such
Owner may, subject to the immediately succeeding sentence and the rules and
procedures of the applicable Depositary, as the case may be, cause the exchange
or transfer of such interest for an equivalent beneficial interest in the Rule
144A Global Capital Security. To the extent that the Institutional Trustee,
as
Registrar, has received (A) instructions from the applicable Depositary, as
the
case may be, directing the Institutional Trustee, as Registrar, to cause to
be
credited a beneficial interest in the Rule 144A Global Capital Security equal
to
the beneficial interest in the Regulation S Global Capital Security to be
exchanged or transferred but not less than the minimum denomination applicable
to Securities held through Rule 144A Global Capital Securities, such
instructions to contain information regarding the participant account with
the
Depositary to be credited with such increase, and (B) a certificate in the
form
of Exhibit F attached hereto, given by the Owner of such beneficial interest
(in
the case of an exchange) or the transferee of such beneficial interest (in
the
case of a transfer) stating that the Person acquiring such interest in the
Rule
144A Global Capital Security is a QIB/QP and is obtaining such beneficial
interest in a transaction meeting the requirements of Rule 144A and in
accordance with any applicable securities laws of any state of the U.S. or
any
other relevant jurisdiction, or that, in the case of an exchange, the Owner
is a
QIB/QP, then the Institutional Trustee, as Registrar, will instruct the
Depositary to reduce the Regulation S Global Capital Security by the aggregate
principal amount of the beneficial interest in the Regulation S Global Capital
Security to be transferred or exchanged, and the Institutional Trustee, as
Registrar, shall instruct the Depositary, concurrently with such reduction,
to
credit or cause to be credited to the account of the Person specified in such
instructions a beneficial interest in the Rule 144A Global Capital Security
equal to the reduction in the principal amount of the Regulation S Global
Capital Security.
(iv)
Other
Exchanges
.
(A)
Notwithstanding
the foregoing, if an Owner of a beneficial interest in a Global Capital Security
wishes at any time to transfer an interest in such Global Capital Security
to a
Person other than a QIB/QP or a Person that is not a U.S. Person or U.S.
Resident pursuant to Regulation S, such transfer shall be effected, subject
to
the Applicable Depositary Procedures, in accordance with the provisions of
this
Article VI and the transferee shall receive a definitive, physical Capital
Securities Certificate in connection with such transfer upon delivery of a
certificate in the form of Exhibit B or Exhibit C, as applicable, attached
hereto to the Institutional Trustee. A Holder of a definitive, physical Capital
Securities Certificate that is a QIB/QP or that is not a U.S. Person or U.S.
Resident pursuant to Regulation S may, upon request, and in accordance with
the
provisions of this Article VI, exchange such definitive, physical Capital
Securities Certificate for a beneficial interest in a Global Capital
Security.
(B)
In
the
event that a Global Capital Security is exchanged for Capital Securities
Certificate(s) in definitive, physical registered form without interest coupons,
such Capital Securities Certificate(s) may be exchanged for one another only
in
accordance with such procedures and restrictions as are substantially consistent
with the provisions above (including certification requirements intended to
ensure that such transfers comply with Rule 144A or another exemption from
the
registration requirements of the Securities Act, or are to non-U.S. Persons
and
non-U.S. Residents, or otherwise comply with Regulation S, as the case may
be)
and as may be from time to time adopted by the Administrators and the
Institutional Trustee.
(C)
Subject
to compliance with the transfer restrictions contained in herein, transfers
of
interests in a Global Capital Security may be made (x) by book-entry transfer
of
beneficial interests within the relevant Depositary or (y)(i) in the case of
transfers of interests in a Rule 144A Global Capital Security or in a Regulation
S Global Capital Security, in accordance with this Article VI; provided, that,
in the case of any such transfer of interests pursuant to clause (x) or (y)
above, such transfer is made in accordance with subclause (D)
below.
(D)
Restrictions
on Transfers.
(1)
Transfers
of interests in a Regulation S Global Capital Security to a U.S. Person or
a
U.S. Resident that is a QIB/QP shall be made by delivery of an interest in
the
corresponding Rule 144A Global Capital Security and shall be limited to
transfers made pursuant to this Article VI. Beneficial interests in a Rule
144A
Global Capital Security may only be held through the applicable
Depositary.
(2)
Any
transfer of an interest in a Security to a U.S. Person or a U.S. Resident that
is not a QIB/QP and/or a institutional “accredited investor” within the meaning
of Rule 501(a)(1), (2), (3) or (7) under the Securities Act shall be null and
void ab initio and shall not be given effect for any purpose hereunder, and
the
Institutional Trustee shall hold any funds conveyed by the intended transferee
of such interest in such Security in trust for the transferor and shall promptly
reconvey such funds to such Person in accordance with the written instructions
thereof delivered to the Institutional Trustee at its address listed herein;
(3)
Any
transfer of an interest in a Global Capital Security to a U.S. Person or a
U.S.
Resident that is not a QIB/QP, but who is an institutional “accredited
investor”, may and shall be made by delivery of an interest in definitive,
physical Capital Securities Certificate(s) and shall be limited to transfers
made pursuant to this Article VI.
(4)
Transfers
of interests in a Rule 144A Global Capital Security to a Person that is not
a
U.S. Person or U.S. Resident shall be made by delivery of an interest in the
corresponding Regulation S Global Capital Security and shall be limited to
transfers made pursuant to this Article VI. Beneficial interests in a Regulation
S Global Capital Security may only be held through the applicable
Depositary.
(c)
Every
Definitive Capital Securities Certificate executed and delivered upon
registration or transfer of, or in exchange for or in lieu of, a Global Capital
Security or any portion thereof shall be executed and delivered in the form
of,
and shall be, a Global Capital Security, unless such Definitive Capital
Securities Certificate is registered in the name of a Person other than the
Depositary for such Global Capital Security or a nominee thereof.
(d)
Execution
of
Global Capital Securities Generally
.
The
Administrators shall execute and the Institutional Trustee shall, in accordance
with this Section 6.4(d), authenticate and deliver initially one or more
Global Capital Securities evidencing the Capital Securities that shall be (i)
registered in the name of the Depositary for such Global Capital Security or
Global Capital Securities or its
nominee
and (ii)
delivered by the Institutional Trustee to such Depositary or pursuant to such
Depositary’s instructions or held by the Institutional Trustee, as custodian for
the Depositary.
(e)
Rights
of Agent Members in Global Capital Securities Generally.
The
Depositary or its nominee, as registered
Owner
of a
Global Capital Security, shall be the Holder of such Global Capital Security
for
all purposes under this Declaration and the Global Capital Security, and Owners
with respect to a Global Capital Security shall hold such interests pursuant
to
the Applicable Depositary Procedures. The Registrar, the Administrators and
the
Institutional Trustee shall be entitled to deal with the Depositary for all
purposes of this Declaration relating to the Global Capital Securities
(including the payment of the liquidation amount of and Distributions on the
Book-Entry Capital Securities represented thereby and the giving of instructions
or directions by Owners of Book-Entry Capital Securities represented thereby
and
the giving of notices) as the sole Holder of the Book-Entry Capital Securities
represented thereby and shall have no obligations to the Owners thereof. None
of
the Administrators, the Institutional Trustee nor the Registrar shall have
any
liability in respect of any transfers effected by the Depositary.
Members
of, or participants in, the Depositary (“Agent Members”) shall have no rights
under this Declaration with respect to any interest in a Global Capital Security
held on their behalf by the Depositary or under the Global Capital Securities,
and the Depositary, may be treated by the Administrators, the Institutional
Trustee and any agent of the Depositary, the Administrators, or the
Institutional Trustee as the absolute Holder of such Global Capital Security
for
all purposes whatsoever (except to the extent otherwise provided herein).
Notwithstanding the foregoing, nothing herein shall prevent the Administrators,
the Institutional Trustee or any agent of the Depositary, the Administrators
or
the Institutional Trustee from giving effect to any written certification,
proxy
or other authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices governing
the exercise of the rights of a Holder of any Capital Security.
(f)
Rights
of Owners of the Book-Entry Capital Securities Generally.
The
rights of the Owners of beneficial interests in the Book-Entry Capital
Securities shall be exercised only through the Depositary and shall be limited
to those established by law, the Applicable Depositary Procedures and agreements
between such Owners and the Depositary and/or the Depositary Participants.
No
Owner of any beneficial interest in any the Book-Entry Capital Security held
on
its behalf by a Depositary shall have any rights under this Declaration with
respect to such Book-Entry Capital Security, and such Depositary may be treated
by the Administrators and the Institutional Trustee and any agent of the Sponsor
or the Administrators and the Institutional Trustee as the Holder of such
Book-Entry Capital Security for all purposes whatsoever. None of the Sponsor,
Administrators, the Institutional Trustee nor any agent of the Sponsor, the
Administrators nor the Institutional Trustee will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests of a Book-Entry Capital Security or
maintaining, supervising or reviewing any records relating to such beneficial
ownership interests. Notwithstanding the foregoing, nothing herein shall prevent
the Administrators and the Institutional Trustee or any agent of the Sponsor
or
the Administrators and the Institutional Trustee from giving effect to any
written certification, proxy or other authorization furnished by a Depositary
or
impair, as between a Depositary and such Owners of beneficial interests in
the
Book-Entry Capital Securities, the operation of customary practices governing
the exercise of the rights of the Depositary (or its nominee) as Holder of
any
Capital Security. Notwithstanding anything to the contrary herein, solely for
the purpose of determining whether the Holders of the requisite amount of
Capital Securities have voted on any matter provided for in this Declaration,
to
the extent that Capital Securities are represented by a Global Capital Security,
the Trustees may conclusively rely on, and shall be fully protected in relying
on, any written instrument (including a proxy) delivered to the Institutional
Trustee by the Depositary setting forth the Owners’ votes or assigning the right
to vote on any matter to any other Persons either in whole or in part. To the
extent that Capital Securities are represented by a Global Capital Security,
the
initial Depositary will make book-entry transfers among the Depositary
Participants and receive and transmit payments on the Capital Securities that
are represented by a Global Capital Security to such Depositary Participants,
and none of the Sponsor, the Administrators nor the Institutional Trustee shall
have any responsibility or obligation with respect thereto.
(g)
To
the
extent that a notice or other communication to the Holders is required under
this Declaration, for so long as Capital Securities are represented by a Global
Capital Security, the
Administrators
and the Institutional Trustee
shall
give all such notices and communications to the Depositary, and shall have
no
obligations to the Owners.
(h)
Each
Owner of a beneficial interest in a Rule 144A Global Capital Security will
be
deemed to have represented and agreed with the Administrators and the
Institutional Trustee as follows (except that in a transfer of a beneficial
interest in a Regulation S Global Capital Security to a transferee that takes
delivery in the
form
of an
interest in a Rule 144A Global Capital Security, the transferee will be required
to make the required representations in a transfer certificate in the form
set
forth as
Exhibit
E
):
(i)
The
Owner
is purchasing the Capital Security for its own account or one or more accounts
with respect to which it exercises sole investment discretion, in each case
in
minimum denominations of $100,000 and integral multiples of $1,000 in excess
thereof, and both it and each such account (if any) (A) is a QIB/QP, (B) is
not
a dealer of the type described in paragraph (a)(1)(ii) of Rule 144A unless
it
owns and invests on a discretionary basis not less than $25,000,000 in
securities of issuers that are not affiliated to it, (C) is not a
participant-directed employee plan, such as a 401(k) plan, or any other type
of
plan referred to in paragraph (a)(1)(i)(D) or (a)(1)(i)(E) of Rule 144A, or
a
trust fund referred to in paragraph (a)(1)(i)(F) of Rule 144A that holds the
assets of such a plan, unless investment decisions with respect to the plan
are
made solely by the fiduciary, trustee or sponsor of such plan, (D) was not
formed for the purpose of investing in the Trust (except where each beneficial
Owner of the holder is a QP) and (E) shall provide written notice to any
transferee that any transferee taking delivery of the Capital Security in the
form of an interest in a Rule 144A Global Capital Security must satisfy the
foregoing qualifications.
(ii)
The
Owner
agrees on its own behalf and on behalf of any account for which it is holding
the Capital Security to offer, sell or otherwise transfer such Capital Security
(or a beneficial interest therein) only (A) in the required minimum
denomination, and (B)(1) in the U.S., only in the form of an interest in a
Rule
144A Global Capital Security to a QP that the Owner reasonably believes is
a
QIB, purchasing for its own account or one or more accounts, each of which
is a
QP that the Owner reasonably believes is a QIB, in accordance with Rule l44A,
and none of which are (i) a dealer of the type described in paragraph (a)(1)(ii)
of Rule 144A unless it owns and invests on a discretionary basis not less than
$25,000,000 in securities of issuers that are not affiliated to it, (ii) a
participant-directed employee plan, such as a 401(k) plan, or any other type
of
plan referred to in paragraph (a)(1)(i)(D) or (a)(1)(i)(E) of Rule 144A, or
a
trust fund referred to in paragraph (a)(1)(i)(F) of Rule 144A that holds the
assets of such a plan, unless investment decisions with respect to the plan
are
made solely by the fiduciary, trustee or sponsor of such plan or (iii) formed
for the purpose of investing in the Trust (except where each beneficial Owner
is
a QP) or (2) outside the U.S. in the form of an interest in a Regulation S
Global Capital Security to a Person that is neither a U.S. Person nor a U.S.
Resident in an offshore transaction in accordance with Regulation S. The Owner
understands and agrees that neither a U.S. Person nor a U.S. Resident may hold
an interest in a Capital Security in the form of a Regulation S Global Capital
Security at any time. The Owner agrees to provide notice of such transfer
restrictions to any subsequent transferee.
(iii)
The
Owner
understands that the Trust is entitled to require any Holder of Capital
Securities who is a U.S. Person or a U.S. Resident who is determined not to
have
been a QIB/QP at the time of acquisition of the Capital Security (or interest
therein) to (A) if such Person is an institutional “accredited investor” within
the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act, receive
definitive, physical Capital Securities or (B) sell such interest to a Person
that is a QIB/QP or to a Person that is neither a U.S. Person nor a U.S.
Resident in a transaction meeting the requirements of Regulation S.
(iv)
The
Owner
understands that the Capital Securities have not been approved or disapproved
by
the SEC or any other governmental authority or agency of any jurisdiction.
Any
representation to the contrary is a criminal offense.
(v)
The
Owner
agrees that no Capital Security (or any interest therein) may be sold, pledged
or otherwise transferred in a denomination of less than $100,000 and integral
multiples of $1,000 in excess thereof.
(vi)
The
Owner
(A) has such knowledge and experience in financial and business matters that
the
Owner is capable of evaluating the merits and risks (including for tax, legal,
regulatory, accounting and other financial purposes) of its prospective
investment in the Capital Securities, (B) is financially able to bear such
risk,
(C) in making such investment is not relying on the advice or recommendations
of
the Sponsor, the Administrators and the Institutional Trustee or any of their
respective Affiliates (or any representative of any of the foregoing), (D)
has
determined that an investment in the Capital Securities is suitable and
appropriate for it, and (E) has had access to such financial and other
information concerning the Sponsor, the Trust and the Capital Securities as
it
has deemed necessary to make its own independent decision to purchase such
Capital Securities, including the opportunity, at a reasonable time prior to
its
purchase of such Capital Securities, to ask questions and receive answers
concerning the Sponsor, the Trust and the terms and conditions of the offering
of the Capital Securities.
(vii)
The
Owner
understands that there is no market for the Capital Securities and that no
assurance can be given as to the liquidity of any trading market for the Capital
Securities and that it is unlikely that a trading market for the Capital
Securities will develop. Accordingly, the Owner must be prepared to hold the
Capital Securities for an indefinite period of time or until their
maturity.
(viii)
The
Owner
agrees that no sale, pledge or other transfer of a Capital Security (or any
interest therein) may be made if such transfer would have the effect of
requiring the Sponsor or the Trust to register as an investment company under
the Investment Company Act.
(ix)
The
Owner
will be deemed to represent, warrant and covenant, for the duration that it
holds an interest in such Capital Security, that either (A) it is not acquiring
such Capital Securities with the assets of a Person who is or will be an
employee benefit, individual retirement account or other Plan or arrangement
(each, a “Plan”) subject to Title I of the Employee Retirement Income Security
Act of 1974, as amended (“ERISA”), or Section 4975 of the Internal Revenue
Code of 1986, as amended (the “Code”) or (B) its acquisition, holding and
disposition of such Capital Securities, throughout the period that it holds
such
Capital Securities, will not result in a non-exempt prohibited transaction
under
Section 406 of ERISA or Section 4975 of the Code (or any substantially
similar applicable law), because the acquisition, holding and disposition of
such Capital Securities by the Owner is and will be eligible for relief under
a
prohibited transaction exemption, all of the conditions of which are and will
be
satisfied upon its acquisition of, and throughout the term that it holds, such
Capital Securities. Each Owner of such Capital Securities will be deemed to
represent, warrant and covenant that it will not sell, pledge or otherwise
transfer such Capital Securities in violation of the foregoing. In addition,
if
the Owner is, or is acting on behalf of, a Plan, the fiduciaries of such Plan
represent, warrant and covenant that they have been informed of and understand
the Trust’s and Sponsor’s investment objectives, policies and strategies and
that the decision to invest such Plan’s assets in such Capital Securities was
made with appropriate consideration of relevant investment factors with regard
to such Plan and is consistent with the duties and responsibilities imposed
upon
fiduciaries with regard to their investment decisions under ERISA.
(x)
The
Owner
agrees that (A) any sale, pledge or other transfer of a Capital Security (or
any
interest therein) made in violation of the transfer restrictions contained
in
this Declaration, or made based upon any false or inaccurate representation
made
by the Owner or a transferee to the Trust or Sponsor, will be void and of no
force or effect and (B) none of the Sponsor, the Trust, the Administrators,
the
Institutional Trustee nor the Registrar has any obligation to recognize any
sale, pledge or other transfer of a Capital Security (or any interest therein)
made in violation of any such transfer restriction or made based upon any such
false or inaccurate representation.
(xi)
The
Owner
is not a member of the public in the Cayman Islands.
(xii)
The
Rule
144A Global Capital Securities will bear the applicable legends set forth
herein.
(xiii)
The
Owner
has the power and authority to enter into each agreement required to be executed
and delivered by or on behalf of the Owner in connection with its purchase
of
Capital Securities and to perform its obligations thereunder and consummate
the
transactions contemplated thereby, and the Person signing any such documents
on
behalf of the Owner has been duly authorized to execute and deliver such
documents and each other document required to be executed and delivered by
the
Owner in connection with its purchase of Capital Securities. Such execution,
delivery and compliance by the Owner does not conflict with, or constitute
a
default under, any instruments governing the Owner, any applicable law,
regulation or order, or any material agreement to which the Owner is a party
or
by which the Owner is bound.
(xiv)
If
the
Owner’s permanent address is located in the U.S., the Owner was offered the
Capital Securities in the state of such Owner’s permanent address and intends
that the securities law of that state govern the Owner’s subscription for the
Capital Securities.
(xv)
The
Owner
understands that the Trust may require certification acceptable to it (i) to
permit the Trust to make payments to it without, or at a reduced rate of,
withholding or (ii) to enable the Trust to qualify for a reduced rate of
withholding in any jurisdiction from or through which the Trust receives
payments on its assets. The Owner agrees to provide any such certification
that
is requested by the Trust.
(xvi)
The
Owner
acknowledges that the Trust, the Sponsor, the Administrators, the Institutional
Trustee and others will rely upon the truth and accuracy of the foregoing
acknowledgments, representations and agreements and agrees that, if any of
the
acknowledgments, representations or warranties made or deemed to have been
made
by it in connection with its purchase of the Capital Securities are no longer
accurate, the Owner will promptly notify the Sponsor, the Administrators and
the
Institutional Trustee.
(i)
Each
Owner of a beneficial interest in a Regulation S Global Capital Security shall
be deemed to have represented and agreed with the Trust as set forth in clauses
(ii) through (xvi) of clause (h) above (except that in a transfer of an interest
in a Rule 144A Global Capital Security to a transferee that takes delivery
in
the form of an interest in a Regulation S Global Capital Security, the
transferee will be required to make the required representations in a transfer
certificate in the form set forth as Exhibit E). Each Owner of a beneficial
interest in a Regulation S Global Capital Security will also be deemed or
required (as applicable) to represent, warrant and agree as
follows:
(i)
The
Owner
is neither a U.S. Person nor a U.S. Resident purchasing for its own account
or
one or more accounts, each of which is neither a U.S. Person nor a U.S.
Resident, and as to each of which the Owner exercises sole investment
discretion, in an offshore transaction pursuant to Regulation S and is aware
that the sale of the Capital Securities to it is being made in reliance on
the
exemption from registration provided by Regulation S.
(ii)
The
Regulation S Global Capital Securities will bear the applicable legends set
forth herein.
(iii)
The
Owner
understands and agrees that before a Capital Security in the form of an interest
in a Regulation S Global Capital Security may be offered, sold, pledged or
otherwise transferred to a transferee that takes delivery in the form of a
Rule
144A Global Capital Security, the transferee shall be required to provide the
Trustee with a transfer certificate in the form attached hereto as Exhibit
F to
the effect that the transferee is a QIB/QP which is acquiring the interest
in
the Capital Security in the form of a Rule 144A Global Capital Security in
a
transaction meeting the requirements of Rule 144A and in accordance with any
applicable securities laws of any state of the U.S. or any other relevant
jurisdiction.
(j)
Notwithstanding
anything contained in this Declaration to the contrary, and to the maximum
extent permitted under applicable law, neither the Institutional Trustee nor
the
Registrar (nor any other Transfer Agent) shall be responsible or liable for
compliance with applicable federal or state securities law (including the
Securities Act, Rule 144A or Regulation S promulgated thereunder), the
Investment Company Act, ERISA or the Code (or any applicable regulations
thereunder); provided, however, that if a specified transfer certificate or
Opinion of Counsel is required by the express terms of this Article VI to be
delivered to the Institutional Trustee or Registrar prior to registration of
transfer of a Capital Security, the Institutional Trustee and/or Registrar,
as
applicable, shall be under a duty to receive such certificate or Opinion of
Counsel and to examine the same to determine whether it conforms on its face
to
the requirements hereof (and the Institutional Trustee or Registrar, as the
case
may be, shall promptly notify the party delivering the same if it determines
that such certificate or Opinion of Counsel does not so conform).
SECTION
6.5.
Mutilated,
Destroyed, Lost or Stolen Certificates
.
If:
(a)
any
mutilated Certificates should be surrendered to the Registrar, or if the
Registrar shall receive evidence to its satisfaction of the destruction, loss
or
theft of any Certificate; and
(b)
there
shall be delivered to the Registrar, the Administrators and the Institutional
Trustee such security or indemnity as may be required by them to hold each
of
them harmless; then, in the absence of notice that such Certificate shall have
been acquired by a bona fide purchaser, an Administrator on behalf of the Trust
shall execute (and in the case of a Capital Security Certificate, the
Institutional Trustee shall authenticate) and deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like denomination. In connection with the issuance of any new
Certificate under this Section 6.5, the Registrar or the Administrators 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 Certificate
issued pursuant to this Section shall constitute conclusive evidence of an
ownership interest in the relevant Securities, as if originally issued, whether
or not the lost, stolen or destroyed Certificate shall be found at any
time.
SECTION
6.6.
Temporary
Securities
.
Until
definitive Securities are ready for delivery, the Administrators may prepare
and, in the case of the Capital Securities, the Institutional Trustee shall
authenticate, temporary Securities. Temporary Securities shall be substantially
in form of definitive Securities but may have variations that the Administrators
consider appropriate for temporary Securities. Without unreasonable delay,
the
Administrators shall prepare and, in the case of the Capital Securities, the
Institutional Trustee shall authenticate definitive Securities in exchange
for
temporary Securities.
SECTION
6.7.
Cancellation
.
The
Administrators at any time may deliver Securities to the Institutional Trustee
for cancellation. The Registrar shall forward to the Institutional Trustee
any
Securities surrendered to it for registration of transfer, redemption or
payment. The Institutional Trustee shall promptly cancel all Securities
surrendered for registration of transfer, payment, replacement or cancellation
and shall dispose of such canceled Securities in accordance with its standard
procedures or otherwise as the Administrators direct. The Administrators may
not
issue new Securities to replace Securities that have been paid or that have
been
delivered to the Institutional Trustee for cancellation.
SECTION
6.8.
Rights
of Holders; Waivers of Past Defaults
.
(a)
The
legal
title to the Trust Property is vested exclusively in the Institutional Trustee
(in its capacity as such) in accordance with Section 2.6(g), and the
Holders shall not have any right or title therein other than the undivided
beneficial interest in the assets of the Trust conferred by their 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 Securities shall
be personal property giving only the rights specifically set forth therein
and
in this Declaration. The Securities shall have no, and the issuance of the
Securities shall not be subject to, preemptive or other similar rights and
when
issued and delivered to Holders against payment of the purchase price therefor,
the Securities will be fully paid and nonassessable by the Trust.
(b)
For
so
long as any Capital Securities remain outstanding, if, upon an Indenture Event
of Default, the Debenture Trustee fails or the holders of not less than 25%
in
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 not
less
than a Majority in liquidation amount of the Capital Securities then outstanding
shall have the right to make such declaration by a notice in writing to the
Institutional Trustee, the Sponsor and the Debenture Trustee.
(c)
At
any
time after the acceleration of maturity of 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 provided in the Indenture, if the Institutional
Trustee, subject to the provisions hereof, fails to annul any such acceleration
and waive such default, the Holders of not less than a Majority in liquidation
amount of the Capital Securities, by written notice to the Institutional
Trustee, the Sponsor and the Debenture Trustee, may rescind and annul such
acceleration and its consequences if:
(i)
the
Sponsor has paid or deposited with the Debenture Trustee a sum sufficient to
pay
(A)
all
overdue installments of interest on all of the Debentures;
(B)
any
accrued Deferred Interest on all of the Debentures;
(C)
all
payments on any Debentures that have become due otherwise than by such
declaration of acceleration and interest and Deferred Interest thereon at the
rate borne by the Debentures; and
(D)
all
sums
paid or advanced by the Debenture Trustee under the Indenture and the reasonable
compensation, documented expenses, disbursements and advances of the Debenture
Trustee and the Institutional Trustee, their agents and counsel;
and
(ii)
all
Events of Default with respect to the Debentures, other than the non-payment
of
the principal or premium, if any, of the Debentures that has become due solely
by such acceleration, have been cured or waived as provided in Section 5.07
of the Indenture.
(d)
The
Holders of not less than 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, except a default or Event of Default
in
the payment of principal of or premium, if any, or interest on the Debentures
(unless such default or Event of Default has been cured and a sum sufficient
to
pay all matured installments of interest, premium and principal due otherwise
than by acceleration has been deposited with the Debenture Trustee) or a default
or Event of Default in respect of a covenant or provision that under the
Indenture cannot be modified or amended without the consent of the holder of
each outstanding Debenture. No such rescission shall affect any subsequent
default or impair any right consequent thereon.
(e)
Upon
receipt by the Institutional Trustee of written notice declaring such an
acceleration, or rescission and annulment thereof, by Holders of any part of
the
Capital Securities, 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 Institutional 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 that is 90 days after
such record date, such notice of declaration of 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 that 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 6.8.
(f)
Except
as
otherwise provided in this Section 6.8, the Holders of not less than 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
Declaration, but no such waiver shall extend to any subsequent or other default
or Event of Default or impair any right consequent thereon.
(g)
In
the
event that either (a) an Event of Default has occurred and is continuing or
(b)
the Sponsor has elected to defer payments of interest on the Debentures by
extending the interest payment period, Holders of not less than twenty five
percent (25%) in aggregate principal amount of the Outstanding Securities may
audit the quarterly and annual financial statements and statutory statements
of
the Sponsor.
(h)
In
the
event that either (a) an Event of Default has occurred and is continuing or
(b)
the Sponsor has elected to defer payments of interest in the Capital Securities
by extending the interest payment period (as provided for in Section 2.11
of the Indenture), the Sponsor shall provide to the Trustee and the Holders
of
the Capital Securities quarterly and annual statutory statements, as well as
quarterly updates on any of its subsidiaries or Affiliates, which may be in
liquidation, under supervisory regulation or in runoff.
ARTICLE
VII.
DISSOLUTION
AND TERMINATION OF TRUST
SECTION
7.1.
Dissolution
and Termination of Trust
.
(a) The
Trust shall dissolve on the first to occur of
(i)
unless
earlier dissolved, on September 15, 2042, the expiration of the term of the
Trust;
(ii)
a
Bankruptcy Event with respect to the Sponsor, the Trust or the Debenture
Issuer;
(iii)
(other
than in connection with a merger, consolidation or similar transaction not
prohibited by the Indenture, this Declaration or the Guarantee, as the case
may
be) the filing of a certificate of dissolution or its equivalent with respect
to
the Sponsor or upon the revocation of the charter of the Sponsor and the
expiration of 90 days after the date of revocation without a reinstatement
thereof;
(iv)
the
distribution of the Debentures to the Holders of the Securities, upon exercise
of the right of the Holders of all of the outstanding Common Securities to
dissolve the Trust as provided in Annex I hereto;
provided
,
that
the Holders of the Common Securities shall have received the prior approval
of
all necessary Applicable Insurance Regulatory Authorities then
required;
(v)
the
entry
of a decree of judicial dissolution of any Holder of the Common Securities,
the
Sponsor, the Trust or the Debenture Issuer;
(vi)
when
all
of the Securities shall have been called for redemption and the amounts
necessary for redemption thereof shall have been paid to the Holders in
accordance with the terms of the Securities; or
(vii)
before
the issuance of any Securities, with the consent of all of the Trustees and
the
Sponsor.
(b)
As
soon
as is practicable after the occurrence of an event referred to in
Section 7.1(a), and after satisfaction of liabilities to creditors of the
Trust as required by applicable law, including Section 3808 of the
Statutory Trust Act, and subject to the terms set forth in Annex I, the Delaware
Trustee, when notified in writing of the completion of the winding up of the
Trust in accordance with the Statutory Trust Act, Institutional Trustee shall
terminate the Trust by filing, at the expense of the Sponsor, a certificate
of
cancellation with the Secretary of State of the State of Delaware.
(c)
The
provisions of Section 2.9 and Article IX shall survive the termination of
the Trust.
ARTICLE
VIII.
TRANSFER
OF INTERESTS
SECTION
8.1.
General
.
(a)
When
Capital Securities are presented to the Registrar with a request to register
a
transfer or to exchange them for an equal number of Capital Securities
represented by different Certificates, the Registrar shall register the transfer
or make the exchange if the requirements provided for herein for such
transactions are met. To permit registrations of transfers and exchanges, the
Trust shall issue and the Institutional Trustee shall authenticate Capital
Securities at the Registrar’s request.
(b)
Upon
issuance of the Common Securities, the Sponsor shall acquire and retain
beneficial and record ownership of the Common Securities and, for so long as
the
Securities remain outstanding, the Sponsor shall maintain 100% ownership of
the
Common Securities; provided, however, that any permitted successor of the
Sponsor under the Indenture that is a U.S. Person may succeed to the Sponsor’s
ownership of the Common Securities.
(c)
Capital
Securities may only be transferred, in whole or in part, in accordance with
the
terms and conditions set forth in this Declaration and in the terms of the
Capital Securities. To the fullest extent permitted by applicable law, any
transfer or purported transfer of any Security not made in accordance with
this
Declaration shall be null and void and will be deemed to be of no legal effect
whatsoever and any such transferee shall be deemed not to be the holder of
such
Capital Securities for any purpose, including but not limited to the receipt
of
Distributions on such Capital Securities, and such transferee shall be deemed
to
have no interest whatsoever in such Capital Securities.
(d)
The
Registrar shall provide in a securities register for the registration of
Securities and of transfers of Securities (the “Securities Register”), which
will be effected without charge but only upon payment (with such indemnity
as
the Registrar may reasonably require) in respect of any tax or other
governmental charges that may be imposed in relation to it. Upon its receipt
of
the documents required under this Section 8.1(d) for registration of
transfer of any Securities, the Registrar shall register in the Securities
Register, in the name of the designated transferee or transferees, the
Securities being transferred and thereupon, for all purposes of this
Declaration, such transfer shall be effective and such transferee or transferees
shall be, and such transferor shall no longer be, the Holder of the transferred
Securities. Upon the registration of transfer of a Security pursuant to the
terms of this Declaration in the name of the new Holder thereof, such Security
shall constitute the same Security as the Security so transferred and shall
be
entitled to the same benefits under this Declaration as the Security so
transferred. The Registrar shall, and is authorized to, record and register
in
the Securities Register the transfer of a Security upon the Registrar’s receipt
of originals or copies (which may be by facsimile or other form of electronic
transmission) of a written instrument of transfer in form reasonably
satisfactory to the Registrar duly executed by the Holder or such Holder’s
attorney duly authorized in writing, accompanied, if such Security is being
transferred prior to the Resale Restriction Termination Date other than in
accordance with Section 8.4, by a certificate substantially in the form set
forth as Exhibit B or C, as applicable, hereto, executed by the transferor
or
transferee, as applicable; thereupon, the Registrar is authorized to confirm
in
writing to the transferee of such Security that such transfer has been
registered in the Securities Register and that such transferee is the Holder
of
such Security. The Certificate evidencing the Security so transferred, duly
endorsed by the transferor, shall be surrendered to the Registrar at the time
the transfer conditions specified in the immediately preceding sentence are
satisfied or within five (5) Business Days after the Registrar has registered
the transfer of such Security on the Securities Register, and promptly after
such surrender, the Trust shall execute and, in the case of a Capital Security
Certificate, the Institutional Trustee shall, and is authorized to, authenticate
a Certificate in the name of the transferee as the new Holder of the Security
evidenced thereby. Until the Certificate evidencing the Security so transferred
is surrendered to the Registrar, such Security may not be transferred by such
new Holder. Each Certificate surrendered in connection with a registration
of
transfer shall be canceled by the Institutional Trustee pursuant to
Section 6.7. A transferee of a Security shall be entitled to the rights and
subject to the obligations of a Holder hereunder upon the registration of such
transfer in the Securities Register. Each such transferee shall be deemed to
have agreed to be bound by this Declaration.
(e)
Neither
the Trust nor the Registrar shall be required (i) to issue, register the
transfer of, or exchange any Securities during a period beginning at the opening
of business 15 days before the day of any selection of Securities for redemption
and ending at the close of business on the earliest date on which the relevant
notice of redemption is deemed to have been given to all Holders of the
Securities to be redeemed, or (ii) to register the transfer or exchange of
any
Security so selected for redemption in whole or in part, except the unredeemed
portion of any Security being redeemed in part.
SECTION
8.2.
Transfer
Procedures and Restrictions
.
(a)
Prior
to
the Resale Restriction Termination Date, Certificates evidencing Capital
Securities shall bear the Restricted Securities Legend (as defined below),
which
shall not be removed unless there is delivered to the Trust such satisfactory
evidence, which may include an opinion of counsel, reasonably acceptable to
the
Administrators and the Institutional Trustee, as may be reasonably required
by
the Trust or the Institutional Trustee, that neither the Restricted Securities
Legend nor the restrictions on transfer set forth therein are required to ensure
that transfers thereof comply with the provisions of the Securities Act or
that
such Securities are not “restricted” within the meaning of Rule 144 under the
Securities Act. Upon provision of such satisfactory evidence, the Institutional
Trustee, at the written direction of the Administrators shall authenticate
and
deliver Capital Securities that do not bear the Restricted Securities Legend
(other than the legend contemplated by Section 8.2(d).
(b)
Prior
to
the Resale Restriction Date, without the written consent of Sponsor, Capital
Securities may only be transferred as follows: (i) to a “Qualified Institutional
Buyer” (within the meaning of Rule 144A under the Securities Act) if accompanied
by a certificate of the transferor substantially in the form set forth as
Exhibit C hereto; (ii) to an “accredited investor” within the meaning of Rule
501(a)(1), (2), (3), (7) or (8) under the Securities Act if accompanied by
a
certificate of the transferee substantially in the form set forth as Exhibit
B
hereto; or (iii) to a non-“U.S. Person” in an “offshore transaction” under, and
within the meaning of, Regulation S under the Securities Act if accompanied
by a
certificate of the transferee substantially in the form set forth as Exhibit
B
or Exhibit C, as applicable hereto.
(c)
The
Capital Securities may not be transferred prior to the Resale Restriction
Termination Date except in compliance with restrictions on transfer set forth
in
the legend set forth below (the “Restricted Securities Legend”), and except as
otherwise contemplated in Section 8.2(a), prior to the Resale Restriction
Termination Date, each Certificate evidencing outstanding Capital Securities
shall bear the Restricted Securities Legend:
THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION
IS
EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL
OR OTHERWISE TRANSFER SUCH SECURITY PRIOR TO THE DATE WHICH IS THE LATER OF
(i)
TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER
THE
SECURITIES ACT) AFTER THE LATER OF (Y) THE DATE OF ORIGINAL ISSUANCE HEREOF
AND
(Z) THE LAST DATE ON WHICH THE TRUST OR ANY AFFILIATE (AS DEFINED IN RULE 405
UNDER THE SECURITIES ACT) OF THE TRUST WAS THE HOLDER OF THIS SECURITY OR SUCH
INTEREST OR PARTICIPATION (OR ANY PREDECESSOR THERETO) AND (II) SUCH LATER
DATE,
IF ANY, AS MAY BE REQUIRED BY ANY SUBSEQUENT CHANGE IN APPLICABLE LAW, ONLY
(A)
TO THE DEBENTURE ISSUER OR THE TRUST, (B) PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT (“RULE 144A”), TO A PERSON THE HOLDER REASONABLY BELIEVES IS A
“QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE
IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT
TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO
AN
“ACCREDITED INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (a)(1), (2), (3), (7)
OR (8) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY
FOR
ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF AN “ACCREDITED INVESTOR,” FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, (D) PURSUANT TO OFFERS AND
SALES TO A PERSON THAT IS NEITHER A U.S. PERSON (AS DEFINED IN REGULATION S)
NOT
A U.S. RESIDENT (WITHIN THE MEANING OF THE INVESTMENT COMPANY ACT OF 1940,
AS
AMENDED (THE “INVESTMENT COMPANY ACT”)) IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH RULE 903 OR RULE 904 OF REGULATION S, ACTING FOR ITS OWN ACCOUNT OR FOR
THE
ACCOUNT OF ONE OR MORE PERSONS WITH RESPECT TO WHICH IT EXERCISES SOLE
INVESTMENT DISCRETION, EACH OF WHICH IS NEITHER A U.S. PERSON (AS DEFINED IN
REGULATIONS S) NOR A U.S. RESIDENT (WITHIN THE MEANING OF THE INVESTMENT COMPANY
ACT) OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE DEBENTURE ISSUER’S AND THE
TRUST’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (C),
(D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM IN ACCORDANCE WITH THE
AMENDED AND RESTATED DECLARATION OF TRUST, A COPY OF WHICH MAY BE OBTAINED
FROM
THE DEBENTURE ISSUER OR THE TRUST. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE
HEREOF AGREES THAT IT WILL COMPLY WITH THE FOREGOING RESTRICTIONS.
THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES, REPRESENTS AND WARRANTS
THAT IT WILL NOT ENGAGE IN HEDGING TRANSACTIONS INVOLVING THIS SECURITY UNLESS
SUCH TRANSACTIONS ARE IN COMPLIANCE WITH THE SECURITIES ACT.
THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND
WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT
OR
OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (EACH A “PLAN”), OR AN ENTITY
WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT
IN THE ENTITY AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR
HOLD THIS SECURITY OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER
IS
ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR
PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR
ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS
NOT
PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT
TO
SUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS SECURITY OR ANY
INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING
THEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING
OF
SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS
APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE
BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE WILL NOT
RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975
OF
THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVE
EXEMPTION.
IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS MAY BE REQUIRED BY
THE
AMENDED AND RESTATED DECLARATION OF TRUST TO CONFIRM THAT THE TRANSFER COMPLIES
WITH THE FOREGOING RESTRICTIONS.
THIS
SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A
LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS
THEREOF. ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING A LIQUIDATION
AMOUNT OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT
WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER
OF THIS SECURITY FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT
OF
DISTRIBUTIONS ON THIS SECURITY, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED
TO
HAVE NO INTEREST WHATSOEVER IN THIS SECURITY.
(d)
Capital
Securities may only be transferred in minimum blocks of $100,000 aggregate
liquidation amount (100 Capital Securities) and multiples of $1,000 in excess
thereof. Any attempted transfer of Capital Securities in a block having an
aggregate liquidation amount of less than $100,000 shall be deemed to be void
and of no legal effect whatsoever. Any such purported transferee shall be deemed
not to be a Holder of such Capital Securities for any purpose, including, but
not limited to, the receipt of Distributions on such Capital Securities, and
such purported transferee shall be deemed to have no interest whatsoever in
such
Capital Securities.
(e)
Neither
the Institutional Trustee nor the Registrar shall be responsible for
ascertaining whether any transfer hereunder complies with the registration
provisions of or any exemptions from the Securities Act, applicable state
securities laws or the applicable laws of any other jurisdiction, ERISA, the
Code or the Investment Company Act.
SECTION
8.3.
Deemed
Security Holders
.
The
Trust, the Administrators, the Trustees, the Paying Agent, the Transfer Agent
or
the Registrar may treat the Person in whose name any Certificate shall be
registered on the books and records of the Trust as the sole Holder of such
Certificate and of the Securities represented by such Certificate for purposes
of receiving Distributions and for all other purposes whatsoever and,
accordingly, shall not be bound to recognize any equitable or other claim to
or
interest in such Certificate or in the Securities represented by such
Certificate on the part of any Person, whether or not the Trust, the
Administrators, the Trustees, the Paying Agent, the Transfer Agent or the
Registrar shall have actual or other notice thereof.
SECTION
8.4.
Transfer
of Initial Securities.
Notwithstanding the foregoing provisions of this Article VIII or any other
provision of this Declaration (including all Annexes and Exhibits hereto) to
the
contrary, any or all of the Capital Securities initially issued to the Purchaser
(the “Initial Securities”) may be transferred by the Purchaser to any transferee
selected by it that meets the parameters specified below and, upon delivery
to
the Registrar, of originals or copies (which may be by facsimile or other form
of electronic transmission) of a written instrument of transfer in form
reasonably satisfactory to the Registrar duly executed by the Purchaser or
the
Purchaser’s attorney duly authorized in writing (it being understood that no
signature guarantee shall be required), then the Registrar shall, and is
authorized to, record and register on the Securities Register the transfer
of
such Initial Securities to such transferee; thereupon, the Registrar is
authorized to confirm in writing to the transferee of such Initial Securities
that such transfer has been registered in the Securities Register and that
such
transferee is the Holder of such Initial Securities; provided, however, that
the
Purchaser of the Initial Securities, by its acceptance thereof, agrees that
it
may not transfer any Initial Securities prior to the Resale Restriction
Termination Date to any transferee that is not a “Qualified Institutional Buyer”
(within the meaning of Rule 144A under the Securities Act), an “accredited
investor” within the meaning of Rule 501(a)(1), (2), (3), (7) or (8) under the
Securities Act or a non-”U.S. Person” in an “offshore transaction” under, and
within the meaning of, Regulation S under the Securities Act. The Certificate
evidencing the Initial Securities to be transferred, duly endorsed by the
Purchaser, shall be surrendered to the Registrar at the time the transfer
conditions specified in the immediately preceding sentence are satisfied or
within five (5) Business Days after the Registrar has registered the transfer
of
such Initial Securities in the Securities Register, and promptly after such
surrender, the Trust shall execute and, in the case of a Capital Security
Certificate, the Institutional Trustee shall, and is authorized to, authenticate
a Certificate in the name of the transferee as the new Holder of the Initial
Securities evidenced thereby. Until the Certificate evidencing the Initial
Securities so transferred is surrendered to the Registrar, such Initial
Securities may not be transferred by such new Holder.
ARTICLE
IX.
LIMITATION
OF LIABILITY OF HOLDERS
OF
SECURITIES, TRUSTEES OR OTHERS
SECTION
9.1.
Liability
.
(a)
Except as expressly set forth in this Declaration, the Guarantee and the terms
of the Securities, the Sponsor shall not be:
(i)
personally
liable for the return of any portion of the capital contributions (or any return
thereon) of the Holders of the Securities which shall be made solely from assets
of the Trust; and
(ii)
required
to pay to the Trust or to any Holder of the Securities any deficit upon
dissolution of the Trust or otherwise.
(b)
The
Holder of the Common Securities shall be liable for all of the debts and
obligations of the Trust (other than with respect to the Securities) to the
extent not satisfied out of the Trust’s assets.
(c)
Except
to
the extent provided in Section 9.1(b), and pursuant to § 3803(a) of the
Statutory Trust Act, the Holders of the Securities shall be entitled to the
same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the
State
of Delaware, except as otherwise specifically set forth herein.
SECTION
9.2.
Exculpation
.
(a) No
Indemnified Person shall be liable, responsible or accountable in damages or
otherwise to the Trust or any Covered Person for any loss, damage or claim
incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Declaration or by law, except
that
an Indemnified Person (other than an Administrator) shall be liable for any
such
loss, damage or claim incurred by reason of such Indemnified Person’s
negligence, willful misconduct or bad faith with respect to such acts or
omissions and except that an Administrator shall be liable for any such loss,
damage or claim incurred by reason of such Administrator’s gross negligence or
willful misconduct or bad faith with respect to such acts or
omissions.
(b)
An
Indemnified Person shall be fully protected in relying in good faith upon the
records of the Trust and upon such information, opinions, reports or statements
presented to the Trust by any Person as to matters the Indemnified Person
reasonably believes are within such other Person’s professional or expert
competence and, if selected by such Indemnified Person, has been selected by
such Indemnified Person with reasonable care by or on behalf of the Trust,
including information, opinions, reports or statements as to the value and
amount of the assets, liabilities, profits, losses or any other facts pertinent
to the existence and amount of assets from which Distributions to Holders of
Securities might properly be paid.
(c)
It
is
expressly understood and agreed by the parties hereto that insofar as any
document, agreement or certificate is executed on behalf of the Trust by any
Trustee (i) such document, agreement or certificate is executed and delivered
by
such Trustee, not in its individual capacity but solely as Trustee under this
Declaration in the exercise of the powers and authority conferred and vested
in
it, (ii) each of the representations, undertakings and agreements made on the
part of the Trust is made and intended not as representations, warranties,
covenants, undertakings and agreements by any Trustee in its individual capacity
but is made and intended for the purpose of binding only the Trust and (iii)
under no circumstances shall any Trustee in its individual capacity be
personally liable for the payment of any indebtedness or expenses of the Trust
or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Trust under this Declaration
or
any other document, agreement or certificate.
SECTION
9.3.
Fiduciary
Duty
.
(a) To
the extent that, at law or in equity, an Indemnified Person has duties
(including fiduciary duties) and liabilities relating thereto to the Trust
or to
any other Covered Person, an Indemnified Person acting under this Declaration
shall not be liable to the Trust or to any other Covered Person for its good
faith reliance on the provisions of this Declaration. The provisions of this
Declaration, to the extent that they restrict the duties and liabilities of
an
Indemnified Person otherwise existing at law or in equity (other than the duties
imposed on the Institutional Trustee under the Trust Indenture Act), are agreed
by the parties hereto to replace such other duties and liabilities of the
Indemnified Person.
(b)
Whenever
in this Declaration an Indemnified Person is permitted or required to make
a
decision:
(i)
in
its
“discretion” or under a grant of similar authority, the Indemnified Person shall
be entitled to consider such interests and factors as it desires, including
its
own interests, and shall have no duty or obligation to give any consideration
to
any interest of or factors affecting the Trust or any other Person;
or
(ii)
in
its
“good faith” or under another express standard, the Indemnified Person shall act
under such express standard and shall not be subject to any other or different
standard imposed by this Declaration or by applicable law.
SECTION
9.4.
Indemnification
.
(a) (1)
The Sponsor shall indemnify, to the fullest extent permitted by law, any
Indemnified Person who was or is a party or is threatened to be made a party
to
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the Trust) by reason of the fact that such Person is or was an
Indemnified Person against expenses (including attorneys’ fees and expenses),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such Person in connection with such action, suit or proceeding if such Person
acted in good faith and in a manner such Person reasonably believed to be in
or
not opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe such conduct
was unlawful. The termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the Indemnified
Person did not act in good faith and in a manner which such Person reasonably
believed to be in or not opposed to the best interests of the Trust, and, with
respect to any criminal action or proceeding, had reasonable cause to believe
that such conduct was unlawful.
(ii)
The
Sponsor shall indemnify, to the fullest extent permitted by law, any Indemnified
Person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the Trust
to procure a judgment in its favor by reason of the fact that such Person is
or
was an Indemnified Person against expenses (including attorneys’ fees and
expenses) actually and reasonably incurred by such Person in connection with
the
defense or settlement of such action or suit if such Person acted in good faith
and in a manner such Person reasonably believed to be in or not opposed to
the
best interests of the Trust and except that no such indemnification shall be
made in respect of any claim, issue or matter as to which such Indemnified
Person shall have been adjudged to be liable to the Trust unless and only to
the
extent that the Court of Chancery of Delaware or the court in which such action
or suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case,
such
Person is fairly and reasonably entitled to indemnity for such expenses which
such Court of Chancery or such other court shall deem proper.
(iii)
To
the
extent that an Indemnified Person shall be successful on the merits or otherwise
(including dismissal of an action without prejudice or the settlement of an
action without admission of liability) in defense of any action, suit or
proceeding referred to in paragraphs (i) and (ii) of this Section 9.4(a),
or in defense of any claim, issue or matter therein, such Person shall be
indemnified, to the fullest extent permitted by law, against expenses (including
attorneys’ fees and expenses) actually and reasonably incurred by such Person in
connection therewith.
(iv)
Any
indemnification of an Administrator under paragraphs (i) and (ii) of this
Section 9.4(a) (unless ordered by a court) shall be made by the Sponsor
only as authorized in the specific case upon a determination that
indemnification of the Indemnified Person is proper in the circumstances because
such Person has met the applicable standard of conduct set forth in paragraphs
(i) and (ii). Such determination shall be made (A) by the Administrators by
a
majority vote of a Quorum consisting of such Administrators who were not parties
to such action, suit or proceeding, (B) if such a Quorum is not obtainable,
or,
even if obtainable, if a Quorum of disinterested Administrators so directs,
by
independent legal counsel in a written opinion, or (C) by the Common Security
Holder of the Trust.
(v)
To
the
fullest extent permitted by law, expenses (including attorneys’ fees and
expenses) incurred by an Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 9.4(a) shall be paid by the Sponsor
in advance of the final disposition of such action, suit or proceeding upon
receipt of an undertaking by or on behalf of such Indemnified Person to repay
such amount if it shall ultimately be determined that such Person is not
entitled to be indemnified by the Sponsor as authorized in this
Section 9.4(a). Notwithstanding the foregoing, no advance shall be made by
the Sponsor if a determination is reasonably and promptly made (1) in the case
of a Company Indemnified Person (A) by the Administrators by a majority vote
of
a Quorum of disinterested Administrators, (B) if such a Quorum is not
obtainable, or, even if obtainable, if a Quorum of disinterested Administrators
so directs, by independent legal counsel in a written opinion or (C) by the
Common Security Holder of the Trust, that, based upon the facts known to the
Administrators, counsel or the Common Security Holder at the time such
determination is made, such Indemnified Person acted in bad faith or in a manner
that such Person either believed to be opposed to or did not believe to be
in
the best interests of the Trust, or, with respect to any criminal proceeding,
that such Indemnified Person believed or had reasonable cause to believe such
conduct was unlawful, or (2) in the case of a Fiduciary Indemnified Person,
by
independent legal counsel in a written opinion that, based upon the facts known
to the counsel at the time such determination is made, such Indemnified Person
acted in bad faith or in a manner that such Indemnified Person either believed
to be opposed to or did not believe to be in the best interests of the Trust,
or, with respect to any criminal proceeding, that such Indemnified Person
believed or had reasonable cause to believe such conduct was unlawful. In no
event shall any advance be made (i) to a Company Indemnified Person in instances
where the Administrators, independent legal counsel or the Common Security
Holder reasonably determine that such Person deliberately breached such Person’s
duty to the Trust or its Common or Capital Security Holders or (ii) to a
Fiduciary Indemnified Person in instances where independent legal counsel
promptly and reasonably determines in a written opinion that such Person
deliberately breached such Person’s duty to the Trust or its Common or Capital
Security Holders.
(b)
The
Sponsor shall indemnify, to the fullest extent permitted by applicable law,
each
Indemnified Person from and against any and all loss, damage, liability, tax
(other than taxes based on the income of such Indemnified Person), penalty,
expense or claim of any kind or nature whatsoever incurred by such Indemnified
Person arising out of or in connection with or by reason of the creation,
administration or termination of the Trust, or any act or omission of such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of authority
conferred on such Indemnified Person by this Declaration, except that no
Indemnified Person shall be entitled to be indemnified in respect of any loss,
damage, liability, tax, penalty, expense or claim incurred by such Indemnified
Person by reason of negligence or willful misconduct or bad faith with respect
to such acts or omissions.
(c)
The
indemnification and advancement of expenses provided by, or granted pursuant
to,
the other paragraphs of this Section 9.4 shall not be deemed exclusive of
any other rights to which those seeking indemnification and advancement of
expenses may be entitled under any agreement, vote of stockholders or
disinterested directors of the Sponsor or Capital Security Holders of the Trust
or otherwise, both as to action in such Person’s official capacity and as to
action in another capacity while holding such office. All rights to
indemnification under this Section 9.4 shall be deemed to be provided by a
contract between the Sponsor and each Indemnified Person who serves in such
capacity at any time while this Section 9.4 is in effect. Any repeal or
modification of this Section 9.4 shall not affect any rights or obligations
then existing.
(d)
The
Sponsor or the Trust may purchase and maintain insurance on behalf of any Person
who is or was an Indemnified Person against any liability asserted against
such
Person and incurred by such Person in any such capacity, or arising out of
such
Person’s status as such, whether or not the Sponsor would have the power to
indemnify such Person against such liability under the provisions of this
Section 9.4.
(e)
For
purposes of this Section 9.4, references to “the Trust” shall include, in
addition to the resulting or surviving entity, any constituent entity (including
any constituent of a constituent) absorbed in a consolidation or merger, so
that
any Person who is or was a director, trustee, officer or employee of such
constituent entity, or is or was serving at the request of such constituent
entity as a director, trustee, officer, employee or agent of another entity,
shall stand in the same position under the provisions of this Section 9.4
with respect to the resulting or surviving entity as such Person would have
with
respect to such constituent entity if its separate existence had
continued.
(f)
The
indemnification and advancement of expenses provided by, or granted pursuant
to,
this Section 9.4 shall, unless otherwise provided when authorized or
ratified, continue as to a Person who has ceased to be an Indemnified Person
and
shall inure to the benefit of the heirs, executors and administrators of such
a
Person.
(g)
The
provisions of this Section 9.4 shall survive the termination of this
Declaration or the earlier resignation or removal of the Institutional Trustee.
The obligations of the Sponsor under this Section 9.4 to compensate and
indemnify the Trustees and to pay or reimburse the Trustees for expenses,
disbursements and advances shall constitute additional indebtedness hereunder.
Such additional indebtedness shall be secured by a lien prior to that of the
Securities upon all property and funds held or collected by the Trustees as
such, except funds held in trust for the benefit of the holders of particular
Capital Securities,
provided
,
that
the Sponsor is the holder of the Common Securities.
SECTION
9.5.
Outside
Businesses
.
Any
Covered Person, the Sponsor, the Delaware Trustee and the Institutional Trustee
(subject to Section 4.3(c)) may engage in or possess an interest in other
business ventures of any nature or description, independently or with others,
similar or dissimilar to the business of the Trust, and the Trust and the
Holders of Securities shall have no rights by virtue of this Declaration in
and
to such independent ventures or the income or profits derived therefrom, and
the
pursuit of any such venture, even if competitive with the business of the Trust,
shall not be deemed wrongful or improper. None of any Covered Person, the
Sponsor, the Delaware Trustee or the Institutional Trustee shall be obligated
to
present any particular investment or other opportunity to the Trust even if
such
opportunity is of a character that, if presented to the Trust, could be taken
by
the Trust, and any Covered Person, the Sponsor, the Delaware Trustee and the
Institutional Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Covered Person, the Delaware
Trustee and the Institutional Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the Sponsor,
or may act as depositary for, trustee or agent for, or act on any committee
or
body of holders of, securities or other obligations of the Sponsor or its
Affiliates.
SECTION
9.6.
Compensation;
Fee
.
(a) The
Sponsor agrees:
(i)
to
pay to
the Trustees from time to time such compensation for all services rendered
by
them hereunder as the parties shall agree in writing from time to time (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust); and
(ii)
except
as
otherwise expressly provided herein, to reimburse the Trustees upon request
for
all reasonable, documented expenses, disbursements and advances incurred or
made
by the Trustees in accordance with any provision of this Declaration (including
the reasonable compensation and the expenses and disbursements of their
respective agents and counsel), except any such expense, disbursement or advance
attributable to their negligence or willful misconduct or bad
faith.
(b)
The
provisions of this Section 9.6 shall survive the dissolution of the Trust
and the termination of this Declaration and the removal or resignation of any
Trustee.
ARTICLE
X.
ACCOUNTING
SECTION
10.1.
Fiscal
Year
.
The
fiscal year (the “Fiscal Year”) of the Trust shall be the calendar year, or such
other year as is required by the Code.
SECTION
10.2.
Certain
Accounting Matters.
(a)
At
all
times during the existence of the Trust, the Administrators shall keep, or
cause
to be kept at the principal office of the Trust in the United States, as defined
for purposes of Treasury Regulations § 301.7701-7, full books of account,
records and supporting documents, which shall reflect in reasonable detail
each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting
principles, consistently applied.
(b)
The
Sponsor shall cause the Administrators to deliver to each Holder of Securities:
(1) within 45 days after the end of each quarterly fiscal period other than
year
end, unaudited consolidated financial statements of the Sponsor (including
balance sheet and income statement) covering such period; (2) within the earlier
of (y) 90 days after the end of each year end and (z) such earlier number of
days prescribed by the Commission for the filing with it of a Form 10-K by
companies subject to the informational reporting requirements of the Exchange
Act, (i) audited consolidated financial statements of the Sponsor (including
balance sheet and income statement) covering the related annual period, and
(ii)
the report of the independent accountants with respect to such financial
statements; (3) within 7 days after the filing thereof, each Form 10-K Form
10-Q
and Form 8-K that is prepared by the Sponsor in respect of the Sponsor or the
Trust and filed with the Commission in accordance with the Exchange Act, if
any;
and (4) if the Sponsor is not then (y) subject to Section 13 or 15(d) of
the Exchange Act or (z) exempt from reporting pursuant to Rule 12g3-2(b)
thereunder, the information required to be provided by Rule 144A(d)(4) under
the
Securities Act unless all of such information has been previously delivered
to
Holders under clause (1) or (2) above.
(c)
The
Administrators shall cause to be duly prepared and delivered to each of the
Holders of Securities Form 1099 or such other annual United States federal
income tax information statement required by the Code, containing such
information with regard to the Securities held by each Holder as is required
by
the Code and the Treasury Regulations. Notwithstanding any right under the
Code
to deliver any such statement at a later date, the Administrators shall endeavor
to deliver all such statements within 30 days after the end of each Fiscal
Year
of the Trust.
(d)
The
Administrators shall cause to be duly prepared in the United States, as defined
for purposes of Treasury Regulations § 301.7701-7, and filed an annual United
States federal income tax return on a Form 1041 or such other form required
by
United States federal income tax law, and any other annual income tax returns
required to be filed by the Administrators on behalf of the Trust with any
state
or local taxing authority.
(e)
The
Administrators will cause the Sponsor’s reports filed with all state and federal
agencies to be delivered to Holder promptly after such filing.
(f)
The
Sponsor shall furnish to (i) the Institutional Trustee; (ii) Cohen & Company
(at Cira Centre, 2929 Arch Street, Suite 1703, Philadelphia, PA 19104 or such
other address as designated by Cohen & Company); and (iii) any owner of the
Capital Securities reasonably identified to the Sponsor and the Trust (which
identification shall be made by either such Owner or by Cohen & Company) a
duly completed and executed certificate substantively and substantially in
the
form attached hereto as Exhibit D, including the financial statements referenced
in such Exhibit, which certificate and financial statements shall be so
furnished by the Sponsor not later than forty five (45) days after the end
of
each of the first three fiscal quarters of each fiscal year of the Sponsor
and
not later than ninety (90) days after the end of each fiscal year of the
Sponsor.
SECTION
10.3.
Banking
.
The
Trust shall maintain one or more bank accounts in the United States, as defined
for purposes of Treasury Regulations § 301.7701-7, in the name and for the sole
benefit of the Trust;
provided
,
however
,
that
all payments of funds in respect of the Debentures held by the Institutional
Trustee shall be made directly to the Property Account and no other funds of
the
Trust shall be deposited in the Property Account. The sole signatories for
such
accounts (including the Property Account) shall be designated by the
Institutional Trustee.
SECTION
10.4.
Withholding
.
The
Institutional Trustee or any Paying Agent and the Administrators shall comply
with all withholding requirements under United States federal, state and local
law. The Institutional Trustee or any Paying Agent shall request, and each
Holder shall provide to the Institutional Trustee or any Paying Agent, such
forms or certificates as are necessary to establish an exemption from
withholding with respect to the Holder, and any representations and forms as
shall reasonably be requested by the Institutional Trustee or any Paying Agent
to assist it in determining the extent of, and in fulfilling, its withholding
obligations. The Administrators shall file required forms with applicable
jurisdictions and, unless an exemption from withholding is properly established
by a Holder, shall remit amounts withheld with respect to the Holder to
applicable jurisdictions. To the extent that the Institutional Trustee or any
Paying Agent 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 to the Holder in the amount of the
withholding. 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
Institutional Trustee or any Paying Agent may reduce subsequent Distributions
by
the amount of such withholding.
ARTICLE
XI.
AMENDMENTS
AND MEETINGS
SECTION
11.1.
Amendments
.
(a)
Except as otherwise provided in this Declaration or by any applicable terms
of
the Securities, this Declaration may only be amended by a written instrument
approved and executed by:
(i)
the
Institutional Trustee,
(ii)
if
the
amendment affects the rights, powers, duties, obligations or immunities of
the
Delaware Trustee, the Delaware Trustee,
(iii)
if
the
amendment affects the rights, powers, duties, obligations or immunities of
the
Administrators, the Administrators, and
(iv)
the
Holders of a Majority in liquidation amount of the Common
Securities.
(b)
Notwithstanding
any other provision of this Article XI, no amendment shall be made, and any
such
purported amendment shall be void and ineffective:
(i)
unless
the Institutional Trustee shall have first received
(A)
an
Officers’ Certificate from each of the Trust and the Sponsor that such amendment
is permitted by, and conforms to, the terms of this Declaration (including
the
terms of the Securities); and
(B)
an
opinion of counsel (who may be counsel to the Sponsor or the Trust) that such
amendment is permitted by, and conforms to, the terms of this Declaration
(including the terms of the Securities) and that all conditions precedent to
the
execution and delivery of such amendment have been satisfied; or
(ii)
if
the
result of such amendment would be to
(A)
cause
the
Trust to cease to be classified for purposes of United States federal income
taxation as a grantor trust;
(B)
reduce
or
otherwise adversely affect the powers of the Institutional Trustee in
contravention of the Trust Indenture Act; or
(C)
cause
the
Trust to be deemed to be an Investment Company required to be registered under
the Investment Company Act.
(c)
Except
as
provided in Section 11.1(d), (e) or (g), no amendment shall be made, and
any such purported amendment shall be void and ineffective, unless the Holders
of a Majority in liquidation amount of the Capital Securities shall have
consented to such amendment.
(d)
In
addition to and notwithstanding any other provision in this Declaration, without
the consent of each affected Holder, this Declaration may not be amended to
(i)
change the amount or timing of any Distribution on the Securities or any
redemption or liquidation provisions applicable to the Securities or otherwise
adversely affect the amount of any Distribution required to be made in respect
of the Securities as of a specified date or (ii) restrict the right of a Holder
to institute suit for the enforcement of any Distributions or other amounts
on
or after their due date.
(e)
Section
s
9.1 (b)
and 9.1 (c) and this Section 11.1 shall not be amended without the consent
of all of the Holders of the Securities.
(f)
The
rights of the Holders of the Capital Securities and Common Securities, as
applicable, under Article IV to increase or decrease the number of, and appoint
and remove, Trustees shall not be amended without the consent of the Holders
of
a Majority in liquidation amount of the Capital Securities or Common Securities,
as applicable.
(g)
This
Declaration may be amended by the Institutional Trustee and the Holder of a
Majority in liquidation amount of the Common Securities without the consent
of
the Holders of the Capital Securities to:
(i)
cure
any
ambiguity;
(ii)
correct
or supplement any provision in this Declaration that may be defective or
inconsistent with any other provision of this Declaration;
(iii)
add
to
the covenants, restrictions or obligations of the Sponsor; or
(iv)
modify,
eliminate or add to any provision of this Declaration to such extent as may
be
necessary or desirable, including, without limitation, to ensure that the Trust
will be classified for United States federal income tax purposes at all times
as
a grantor trust and will not be required to register as an Investment Company
under the Investment Company Act (including without limitation to conform to
any
change in Rule 3a-5, Rule 3a-7 or any other applicable rule under the Investment
Company Act or written change in interpretation or application thereof by any
legislative body, court, government agency or regulatory authority) which
amendment does not have a material adverse effect on the right, preferences
or
privileges of the Holders of Securities;
provided
,
however
,
that no
such modification, elimination or addition referred to in clauses (i), (ii),
(iii) or (iv) shall adversely affect the powers, preferences or rights or
interests of Holders of Capital Securities.
SECTION
11.2.
Meetings
of the Holders of the Securities; Action by Written Consent
.
(a)
Meetings
of the Holders of any class of Securities may be called at any time by the
Administrators (or as provided in the terms of the Securities) to consider
and
act on any matter on which Holders of such class of Securities are entitled
to
act under the terms of this Declaration, the terms of the Securities or the
rules of any stock exchange on which the Capital Securities are listed or
admitted for trading, if any. The Administrators shall call a meeting of the
Holders of such class if directed to do so by the Holders of not less than
10%
in liquidation amount of such class of Securities. Such direction shall be
given
by delivering to the Administrators one or more notices in a writing stating
that the signing Holders of the Securities wish to call a meeting and indicating
the general or specific purpose for which the meeting is to be called. Any
Holders of the Securities calling a meeting shall specify in writing the
Certificates held by the Holders of the Securities exercising the right to
call
a meeting and only those Securities represented by such Certificates shall
be
counted for purposes of determining whether the required percentage set forth
in
the second sentence of this paragraph has been met.
(b)
Except
to
the extent otherwise provided in the terms of the Securities, the following
provisions shall apply to meetings of Holders of the Securities:
(i)
notice
of
any such meeting shall be given to all the Holders of the Securities having
a
right to vote thereat at least 7 days and not more than 60 days before the
date
of such meeting. Whenever a vote, consent or approval of the Holders of the
Securities is permitted or required under this Declaration or the rules of
any
stock exchange on which the Capital Securities are listed or admitted for
trading, if any, such vote, consent or approval may be given at a meeting of
the
Holders of the Securities. Any action that may be taken at a meeting of the
Holders of the Securities may be taken without a meeting if a consent in writing
setting forth the action so taken is signed by the Holders of the Securities
owning not less than the minimum amount of Securities that would be necessary
to
authorize or take such action at a meeting at which all Holders of the
Securities having a right to vote thereon were present and voting. Prompt notice
of the taking of action without a meeting shall be given to the Holders of
the
Securities entitled to vote who have not consented in writing. The
Administrators may specify that any written ballot submitted to the Holders
of
the Securities for the purpose of taking any action without a meeting shall
be
returned to the Trust within the time specified by the
Administrators;
(ii)
each
Holder of a Security may authorize any Person to act for it by proxy on all
matters in which a Holder of Securities is entitled to participate, including
waiving notice of any meeting, or voting or participating at a meeting. No
proxy
shall be valid after the expiration of 11 months from the date thereof unless
otherwise provided in the proxy. Every proxy shall be revocable at the pleasure
of the Holder of the Securities executing it. Except as otherwise provided
herein, all matters relating to the giving, voting or validity of proxies shall
be governed by the General Corporation Law of the State of Delaware relating
to
proxies, and judicial interpretations thereunder, as if the Trust were a
Delaware corporation and the Holders of the Securities were stockholders of
a
Delaware corporation; each meeting of the Holders of the Securities shall be
conducted by the Administrators or by such other Person that the Administrators
may designate; and
(iii)
unless
the Statutory Trust Act, this Declaration, the terms of the Securities, the
Trust Indenture Act or the listing rules of any stock exchange on which the
Capital Securities are then listed for trading, if any, otherwise provides,
the
Administrators, in their sole discretion, shall establish all other provisions
relating to meetings of Holders of Securities, including notice of the time,
place or purpose of any meeting at which any matter is to be voted on by any
Holders of the Securities, waiver of any such notice, action by consent without
a meeting, the establishment of a record date, quorum requirements, voting
in
person or by proxy or any other matter with respect to the exercise of any
such
right to vote;
provided
,
however
,
that
each meeting shall be conducted in the United States (as that term is defined
in
Treasury Regulations § 301.7701-7).
ARTICLE
XII.
REPRESENTATIONS
OF INSTITUTIONAL TRUSTEE
AND
DELAWARE TRUSTEE
SECTION
12.1.
Representations
and Warranties of Institutional Trustee
.
The
Trustee that acts as initial Institutional Trustee represents and warrants
to
the Trust and to the Sponsor at the date of this Declaration, and each Successor
Institutional Trustee represents and warrants to the Trust and the Sponsor
at
the time of the Successor Institutional Trustee’s acceptance of its appointment
as Institutional Trustee, that:
(a)
the
Institutional Trustee is a banking corporation or national association with
trust powers, duly organized, validly existing and in good standing under the
laws of any state of the United States or the United States of America, as
applicable, with trust power and authority to execute and deliver, and to carry
out and perform its obligations under the terms of, this
Declaration;
(b)
the
Institutional Trustee has a combined capital and surplus of at least fifty
million U.S. dollars ($50,000,000);
(c)
the
Institutional Trustee is not an Affiliate of the Sponsor, nor does the
Institutional Trustee offer or provide credit or credit enhancement to the
Trust;
(d)
the
execution, delivery and performance by the Institutional Trustee of this
Declaration has been duly authorized by all necessary action on the part of
the
Institutional Trustee. This Declaration has been duly executed and delivered
by
the Institutional Trustee, and under Delaware law (excluding any securities
laws) constitutes a legal, valid and binding obligation of the Institutional
Trustee, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, reorganization, moratorium, insolvency and other similar
laws affecting creditors’ rights generally and to general principles of equity
and the discretion of the court (regardless of whether considered in a
proceeding in equity or at law);
(e)
the
execution, delivery and performance of this Declaration by the Institutional
Trustee does not conflict with or constitute a breach of the charter or by-laws
of the Institutional Trustee; and
(f)
no
consent, approval or authorization of, or registration with or notice to, any
state or federal banking authority governing the trust powers of the
Institutional Trustee is required for the execution, delivery or performance
by
the Institutional Trustee of this Declaration.
SECTION
12.2.
Representations
and Warranties of Delaware Trustee
.
The
Trustee that acts as initial Delaware Trustee represents and warrants to the
Trust and to the Sponsor at the date of this Declaration, and each Successor
Delaware Trustee represents and warrants to the Trust and the Sponsor at the
time of the Successor Delaware Trustee’s acceptance of its appointment as
Delaware Trustee that:
(a)
if
it is
not a natural person, the Delaware Trustee is duly organized, validly existing
and in good standing under the laws of the State of Delaware;
(b)
if
it is
not a natural person, the execution, delivery and performance by the Delaware
Trustee of this Declaration has been duly authorized by all necessary corporate
action on the part of the Delaware Trustee. This Declaration has been duly
executed and delivered by the Delaware Trustee, and under Delaware law
(excluding any securities laws) constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency and other similar laws affecting creditors’ rights generally and to
general principles of equity and the discretion of the court (regardless of
whether considered in a proceeding in equity or at law);
(c)
if
it is
not a natural person, the execution, delivery and performance of this
Declaration by the Delaware Trustee does not conflict with or constitute a
breach of the charter or by-laws of the Delaware Trustee;
(d)
it
has
trust power and authority to execute and deliver, and to carry out and perform
its obligations under the terms of, this Declaration;
(e)
no
consent, approval or authorization of, or registration with or notice to, any
state or federal banking authority governing the trust powers of the Delaware
Trustee is required for the execution, delivery or performance by the Delaware
Trustee of this Declaration; and
(f)
the
Delaware Trustee is a natural person who is a resident of the State of Delaware
or, if not a natural person, it is an entity which has its principal place
of
business in the State of Delaware and, in either case, a Person that satisfies
for the Trust the requirements of Section 3807 of the Statutory Trust
Act.
ARTICLE
XIII.
MISCELLANEOUS
SECTION
13.1.
Notices
.
All
notices provided for in this Declaration shall be in writing, duly signed by
the
party giving such notice, and shall be delivered, telecopied (which telecopy
shall be followed by notice delivered or mailed by first class mail) or mailed
by first class mail, as follows:
(a)
if
given
to the Trust, in care of the Administrators at the Trust’s mailing address set
forth below (or such other address as the Trust may give notice of to the
Holders of the Securities):
Hallmark
Statutory Trust II
c/o
Hallmark Financial Services, Inc.
777
Main
Street, Suite 1000
Fort
Worth, Texas 76102
Attention:
Mark Morrison
Telecopy:
(817) 348-1815
Telephone:
(817) 348-1728
(b)
if
given
to the Delaware Trustee, at the mailing address set forth below (or such other
address as the Delaware Trustee may give notice of to the Holders of the
Securities):
The
Bank
of New York (Delaware)
100
White
Clay Center
Route
273
Newark,
Delaware 19711
Attention:
Institutional Trust Services - Hallmark Statutory Trust II
Telecopy:
302-283-8905
Telephone:
302-453-4400
(c)
if
given
to the Institutional Trustee, at the Institutional Trustee’s mailing address set
forth below (or such other address as the Institutional Trustee may give notice
of to the Holders of the Securities):
The
Bank
of New York Trust Company, National Association
601
Travis Street, 16
th
Floor
Houston,
Texas 77002
Attention:
Global Corporate Trust - Hallmark Statutory Trust II
Telephone:
(713) 483-6029
(d)
if
given
to the Holder of the Common Securities, at the mailing address of the Sponsor
set forth below (or such other address as the Holder of the Common Securities
may give notice of to the Trust):
Hallmark
Financial Services, Inc.
777
Main
Street, Suite 1000
Fort
Worth, Texas 76102
Attention:
Mark Morrison
Telecopy:
(817) 348-1815
Telephone:
(817) 348-1728
(e)
if
given
to any other Holder, at the address set forth on the books and records of the
Trust.
All
such
notices shall be deemed to have been given when received in person, telecopied
with receipt confirmed, or mailed by first class mail, postage prepaid, except
that if a notice or other document is refused delivery or cannot be delivered
because of a changed address of which no notice was given, such notice or other
document shall be deemed to have been delivered on the date of such refusal
or
inability to deliver.
SECTION
13.2.
Governing
Law
.
This
Declaration and the rights and obligations of the parties hereunder shall be
governed by and interpreted in accordance with the law of the State of Delaware
and all rights, obligations and remedies shall be governed by such laws without
regard to the principles of conflict of laws of the State of Delaware or any
other jurisdiction that would call for the application of the law of any
jurisdiction other than the State of Delaware.
SECTION
13.3.
Submission
to Jurisdiction
.
(a)
Each
of
the parties hereto agrees that any suit, action or proceeding arising out of
or
based upon this Declaration, or the transactions contemplated hereby, may be
instituted in any of the courts of the State of New York located in the Borough
of Manhattan, City and State of New York, and further agrees to submit to the
jurisdiction of Delaware, and to any actions that are instituted in state or
Federal court in Wilmington, Delaware and any competent court in the place
of
its corporate domicile in respect of actions brought against it as a defendant.
In addition, each such party irrevocably waives, to the fullest extent permitted
by law, any objection which it may now or hereafter have to the laying of the
venue of such suit, action or proceeding brought in any such court and
irrevocably waives any claim that any such suit, action or proceeding brought
in
any such court has been brought in an inconvenient forum and irrevocably waives
any right to which it may be entitled on account of its place of corporate
domicile. Each such party hereby irrevocably waives any and all right to trial
by jury in any legal proceeding arising out of or relating to this Declaration
or the transactions contemplated hereby. Each such party agrees that final
judgment in any proceedings brought in such a court shall be conclusive and
binding upon it and may be enforced in any court to the jurisdiction of which
it
is subject by a suit upon such judgment.
(b)
Each
of
the Sponsor, the Trustees, the Administrators and the Holder of the Common
Securities irrevocably consents to the service of process on it in any such
suit, action or proceeding by the mailing thereof by registered or certified
mail, postage prepaid, to it at its address given in or pursuant to
Section 13.1 hereof.
(c)
To
the
extent permitted by law, nothing herein contained shall preclude any party
from
effecting service of process in any lawful manner or from bringing any suit,
action or proceeding in respect of this Declaration in any other state, country
or place.
SECTION
13.4.
Intention
of the Parties
.
It is
the intention of the parties hereto that the Trust be classified for United
States federal income tax purposes as a grantor trust. The provisions of this
Declaration shall be interpreted to further this intention of the
parties.
SECTION
13.5.
Headings
.
Headings contained in this Declaration are inserted for convenience of reference
only and do not affect the interpretation of this Declaration or any provision
hereof.
SECTION
13.6.
Successors
and Assigns
.
Whenever in this Declaration any of the parties hereto is named or referred
to,
the successors and assigns of such party shall be deemed to be included, and
all
covenants and agreements in this Declaration by the Sponsor and the Trustees
shall bind and inure to the benefit of their respective successors and assigns,
whether or not so expressed.
SECTION
13.7.
Partial
Enforceability
.
If any
provision of this Declaration, or the application of such provision to any
Person or circumstance, shall be held invalid, the remainder of this
Declaration, or the application of such provision to persons or circumstances
other than those to which it is held invalid, shall not be affected
thereby.
SECTION
13.8.
Counterparts
.
This
Declaration may contain more than one counterpart of the signature page and
this
Declaration may be executed by the affixing of the signature of each of the
Trustees and Administrators to any of such counterpart signature pages. All
of
such counterpart signature pages shall be read as though one, and they shall
have the same force and effect as though all of the signers had signed a single
signature page.
*
*
*
IN
WITNESS WHEREOF, the undersigned have caused this Declaration to be duly
executed as of the day and year first above written.
|
|
|
|
THE
BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
|
|
|
|
|
By:
|
|
|
|
|
Name: _________________________________
|
|
Title:
__________________________________
|
|
|
|
|
THE
BANK OF NEW YORK TRUST COMPANY, NATIONAL ASSOCIATION,
as Institutional Trustee
|
|
|
|
|
By:
|
|
|
|
|
Name: _________________________________
|
|
Title:
__________________________________
|
|
|
|
|
HALLMARK
FINANCIAL SERVICES, INC.
as
Sponsor
|
|
|
|
|
By:
|
|
|
|
|
Name: _________________________________
|
|
Title:
__________________________________
|
|
|
|
|
By:
|
|
|
|
|
Name: _________________________________
|
|
Administrator
___________________________
|
|
|
|
|
|
|
|
By:
|
|
|
|
|
Name: _________________________________
|
|
Administrator
___________________________
|
ANNEX
I
TERMS
OF
CAPITAL
SECURITIES AND
COMMON
SECURITIES
Pursuant
to Section 6.1 of the Amended and Restated Declaration of Trust, dated as
of August 23, 2007 (as amended from time to time, the “Declaration”), the
designation, rights, privileges, restrictions, preferences and other terms
and
provisions of the Capital Securities and the Common Securities are set out
below
(each capitalized term used but not defined herein has the meaning set forth
in
the Declaration):
1.
Designation
and Number
.
(a)
Capital
Securities
.
25,000
Capital Securities of Hallmark Statutory Trust II (the “Trust”), with an
aggregate stated liquidation amount with respect to the assets of the Trust
of
Twenty Five Million Dollars ($25,000,000) and a stated liquidation amount with
respect to the assets of the Trust of $1,000 per Capital Security (the “Capital
Securities”). The Capital Security Certificates evidencing the Capital
Securities shall be substantially in the form of Exhibit A-1 to the Declaration,
with such changes and additions thereto or deletions therefrom as may be
required by ordinary usage, custom or practice or to conform to the rules of
any
stock exchange on which the Capital Securities are listed, if any.
(b)
Common
Securities
.
774
Common Securities of the Trust (the “Common Securities”) will be evidenced by
Common Security Certificates substantially in the form of Exhibit A-2 to the
Declaration, with such changes and additions thereto or deletions therefrom
as
may be required by ordinary usage, custom or practice. In the absence of an
Event of Default, the Common Securities will have an aggregate stated
liquidation amount with respect to the assets of the Trust of Seven Hundred
Seventy Four Thousand Dollars ($774,000) and a stated liquidation amount with
respect to the assets of the Trust of $1,000 per Common Security.
2.
Distributions
.
(a)
Distributions payable on each Security will be payable at a fixed rate of 8.28%
(the “Fixed Rate”) per annum from the date hereof until September 15, 2017 (the
“Fixed Rate Period”) and thereafter at a variable per annum rate of interest,
reset quarterly, equal to LIBOR, as determined on the LIBOR Determination Date
for such Distribution Period, plus 2.90% (the “Variable Rate”) of the stated
liquidation amount of $1,000 per Security, such rate being (provided, however,
that the Variable Rate for any Distribution Period may not exceed the highest
rate permitted by New York law, as the same may be modified by United States
law
of general applicability). The Coupon Rate (defined to include the Fixed Rate
and Variable Rate, as applicable, shall equal the rate of interest payable
on
the Debentures to be held by the Institutional Trustee. Except as set forth
below in respect of an Extension Period, Distributions in arrears for more
than
one Distribution Period will bear interest thereon compounded quarterly at
the
applicable Coupon Rate for each such quarterly period (to the extent permitted
by applicable law). The term “Distributions” as used herein includes cash
distributions, any such compounded distributions and any Additional Interest
payable on the Debentures unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Debentures held
by
the Institutional Trustee and to the extent the Institutional Trustee has funds
legally available in the Property Account therefor. During the Fixed Rate
Period, the amount of Distributions payable for any Distribution Period will
be
computed for any full quarterly Distribution Period on the basis of a 360-day
year of twelve 30-day months and the amount payable for any partial period
shall
be computed on the basis of the number of days elapsed in a 360-day year of
twelve 30-day months. Upon expiration of the Fixed Rate Period, Distributions
will be computed on the basis of a 360-day year and the actual number of days
elapsed in the relevant Distribution Period; provided, however, that upon the
occurrence of a Special Event Redemption pursuant to paragraph 4(a) below,
the
amounts payable pursuant to this Declaration shall be calculated as set forth
in
the definition of Special Redemption Price.
The
term
“Distribution Period,” as used herein, means (i) in the case of the first
Distribution Period, the period from, and including, the date of original
issuance of the Securities to, but excluding, the initial Distribution Payment
Date and (ii) thereafter, from, and including, the first day following the
end
of the preceding Distribution Period to, but excluding, the applicable
Distribution Payment Date or, in the case of the last Distribution Period,
the
related date of redemption.
(b)
Upon
expiration of the Fixed Rate Period, LIBOR shall be determined by the
Calculation Agent for each Distribution Period in accordance with the following
provisions:
(1)
On
the
second LIBOR Business Day (
provided
,
that on
such day commercial banks are open for business (including dealings in foreign
currency deposits) in London (a “LIBOR Banking Day”), and otherwise the next
preceding LIBOR Business Day that is also a LIBOR Banking Day) prior to March
15, June 15, September 15 and December 15, as the case may be, (except, with
respect to the first Distribution Period, upon expiration of the Fixed Rate
Period, on September 15, 2017), (each such day, a “LIBOR Determination Date”),
LIBOR shall equal the rate, as obtained by the Calculation Agent for three-month
U.S. Dollar deposits in Europe, which appears on Reuters Screen LIBOR 01 Page
(as defined in the International Swaps and Derivatives Association, Inc. 2000
Interest Rate and Currency Exchange Definitions) or such other page as may
replace such page, as of 11:00 a.m. (London time) on such LIBOR Determination
Date, as reported by Bloomberg Financial Markets Commodities News or any
successor service (“Reuters Screen”). “LIBOR Business Day” means any day that is
not a Saturday, Sunday or other day on which commercial banking institutions
in
New York, New York or Wilmington, Delaware are authorized or obligated by law
or
executive order to be closed. If such rate is superseded on Reuters Screen
by a
corrected rate before 12:00 noon (London time) on the same LIBOR Determination
Date, the corrected rate as so substituted will be the applicable LIBOR for
that
LIBOR Determination Date.
(2)
If,
on
any LIBOR Determination Date, such rate does not appear on Reuters Screen,
the
Calculation Agent shall determine the arithmetic mean of the offered quotations
of the Reference Banks (as defined below) to leading banks in the London
Interbank market for three-month U.S. Dollar deposits in Europe (in an amount
determined by the Calculation Agent) by reference to requests for quotations
as
of approximately 11:00 a.m. (London time) on the LIBOR Determination Date made
by the Calculation Agent to the Reference Banks. If, on any LIBOR Determination
Date, at least two of the Reference Banks provide such quotations, LIBOR shall
equal the arithmetic mean of such quotations. If, on any LIBOR Determination
Date, only one or none of the Reference Banks provide such a quotation, LIBOR
shall be deemed to be the arithmetic mean of the offered quotations that at
least two leading banks in the City of New York (as selected by the Calculation
Agent) are quoting on the relevant LIBOR Determination Date for three-month
U.S.
Dollar deposits in Europe at approximately 11:00 a.m. (London time) (in an
amount determined by the Calculation Agent). As used herein, “Reference Banks”
means four major banks in the London Interbank market selected by the
Calculation Agent.
(3)
If
the
Calculation Agent is required but is unable to determine a rate in accordance
with at least one of the procedures provided above, LIBOR for such Distribution
Period shall be LIBOR in effect for the immediately preceding Distribution
Period.
(c)
All
percentages resulting from any calculations on the Securities will be rounded,
if necessary, to the nearest one hundred-thousandth of a percentage point,
with
five one-millionths of a percentage point rounded upward (e.g., 9.876545% (or
.09876545) being rounded to 9.87655% (or .0987655)), and all dollar amounts
used
in or resulting from such calculation will be rounded to the nearest cent (with
one-half cent being rounded upward).
(d)
On
each
LIBOR Determination Date, the Calculation Agent shall notify, in writing, the
Sponsor and the Paying Agent of the applicable Coupon Rate in effect for the
related Distribution Period. The Calculation Agent shall, upon the request
of
the Holder of any Securities, provide the Coupon Rate then in effect. All
calculations made by the Calculation Agent in the absence of manifest error
shall be conclusive for all purposes and binding on the Sponsor and the Holders
of the Securities. The Paying Agent shall be entitled to rely on information
received from the Calculation Agent or the Sponsor as to the Coupon Rate. The
Sponsor shall, from time to time, provide any necessary information to the
Paying Agent relating to any original issue discount and interest on the
Securities that is included in any payment and reportable for taxable income
calculation purposes.
(e)
Distributions
on the Securities will be cumulative, will accrue from the date of original
issuance, and will be payable, subject to extension of Distribution payment
periods as described herein, quarterly in arrears on March 15, June 15,
September 15 and December 15 of each year, commencing September 15, 2007 (each,
a “Distribution Payment Date”). Subject to the terms and conditions set forth in
the Indenture, the Debenture Issuer may defer payments of interest on the
Debentures by extending the interest payment period for up to 20 consecutive
quarterly periods (each such extended interest payment period together with
all
previous and future consecutive extensions thereof, is referred to herein as
an
“Extension Period”) during which Extension Period no interest shall be due and
payable (except any Additional Interest that may be due and payable). During
any
Extension Period, interest will continue to accrue on the Debentures, and
interest on such accrued interest (such accrued interest and interest thereon
referred to herein as “Deferred Interest”) will accrue as set forth in the
Indenture. No Extension Period may end on a date other than a Distribution
Payment Date. At the end of any such Extension Period, the Debenture Issuer
shall pay all Deferred Interest then accrued and unpaid on the Debentures;
provided
,
however
,
that no
Extension Period may extend beyond the Maturity Date any Redemption Date or
Special Redemption Date. The Distributions due shall be paid on the date that
the related Extension Period terminates, to Holders of the Securities as they
appear on the books and records of the Trust on the record date immediately
preceding such date. Distributions on the Securities must be paid on the dates
payable (after giving effect to any Extension Period) to the extent that the
Trust has funds legally available for the payment of such distributions in
the
Property Account of the Trust. The Trust’s funds available for distribution to
the Holders of the Securities will be limited to payments received from the
Debenture Issuer. The payment of Distributions out of moneys held by the Trust
is guaranteed by the Guarantor pursuant to the Guarantee.
(f)
Distributions
on the Securities will be payable to the Holders thereof as they appear on
the
books and records of the Registrar on the relevant record dates. The relevant
record dates shall be selected by the Administrators, which dates shall be
15
days before the relevant payment dates. Distributions payable on any Securities
that are not punctually paid on any Distribution Payment Date, as a result
of
the Debenture Issuer having failed to make a payment under the Debentures,
as
the case may be, when due (taking into account any Extension Period), will
cease
to be payable to the Person in whose name such Securities are registered on
the
relevant record date, and such defaulted Distribution will instead be payable
to
the Person in whose name such Securities are registered on the special record
date or other specified date determined in accordance with the
Indenture.
(g)
In
the
event that there is any money or other property held by or for the Trust that
is
not accounted for hereunder, such property shall be distributed pro rata (as
defined herein) among the Holders of the Securities.
(h)
If
any
Distribution Payment Date, other than any date of redemption, falls on a day
that is not a Business Day, then Distributions payable will be paid on, and
such
Distribution Payment Date will be moved to, the next succeeding Business Day,
and additional Distributions will accrue for each day that such payment is
delayed as a result thereof.
3.
Liquidation
Distribution Upon Dissolution
.
In the
event of the voluntary or involuntary liquidation, dissolution, winding-up
or
termination of the Trust (each, a “Liquidation”) other than in connection with a
redemption of the Debentures, the Holders of the Securities will be entitled
to
receive out of the assets of the Trust available for distribution to Holders
of
the Securities, after satisfaction of liabilities to creditors of the Trust
(to
the extent not satisfied by the Debenture Issuer), an amount in cash equal
to
the aggregate of the stated liquidation amount of $1,000 per Security plus
accrued and unpaid Distributions thereon to the date of payment (such amount
being the “Liquidation Distribution”), unless in connection with such
Liquidation, the Debentures in an aggregate principal amount equal to the
aggregate liquidation amount of such Securities, with an interest rate equal
to
the Coupon Rate of, and bearing accrued and unpaid interest in an amount equal
to the accrued and unpaid Distributions on, and having the same record date
as,
such Securities, after paying or making reasonable provision to pay all claims
and obligations of the Trust in accordance with Section 3808(e) of the
Statutory Trust Act, shall be distributed on a Pro Rata basis to the Holders
of
the Securities in exchange for such Securities.
The
Sponsor, as the Holder of all of the Common Securities, has the right at any
time upon receipt by the Debenture Issuer and the Institutional Trustee for
the
benefit of the Trust of an opinion of nationally recognized tax counsel that
Holders will not recognize any gain or loss for United States Federal income
tax
purposes as a result of the distribution of Debentures, to dissolve the Trust
(including without limitation upon the occurrence of a Tax Event or an
Investment Company Event) after satisfaction of liabilities to creditors of
the
Trust, cause the Debentures to be distributed to the Holders of the Securities
on a Pro Rata basis in accordance with the aggregate liquidation amount
thereof.
The
Trust
shall dissolve on the first to occur of (i) September 15, 2042, the expiration
of the term of the Trust, (ii) a Bankruptcy Event with respect to the Sponsor,
the Trust or the Debenture Issuer, (iii) (other than in connection with a
merger, consolidation or similar transaction not prohibited by the Indenture,
this Declaration or the Guarantee, as the case may be) the filing of a
certificate of dissolution or its equivalent with respect to the Sponsor or
upon
the revocation of the charter of the Sponsor and the expiration of 90 days
after
the date of revocation without a reinstatement thereof, (iv) the distribution
to
the Holders of the Securities of the Debentures, upon exercise of the right
of
the Holder of all of the outstanding Common Securities to dissolve the Trust
as
described above,
provided
,
that
the Holders of the Common Securities shall have received the prior approval
of
all necessary Applicable Insurance Regulatory Authorities then required, (v)
the
entry of a decree of a judicial dissolution of the Sponsor or the Trust, or
(vi)
when all of the Securities shall have been called for redemption and the amounts
necessary for redemption thereof shall have been paid to the Holders in
accordance with the terms of the Securities. As soon as practicable after the
dissolution of the Trust and upon completion of the winding up of the Trust,
the
Trust shall terminate upon the filing of a certificate of cancellation with
the
Secretary of State of the State of Delaware.
If
a
Liquidation of the Trust occurs as described in clause (i), (ii), (iii) or
(v)
in the immediately preceding paragraph, the Trust shall be liquidated by the
Institutional Trustee of the Trust as expeditiously as such Trustee determines
to be possible by distributing, after satisfaction of liabilities to creditors
of the Trust as provided by applicable law, to the Holders of the Securities,
the Debentures on a
Pro
Rata
basis to
the extent not satisfied by the Debenture Issuer, unless such distribution
is
determined by the Institutional Trustee not to be practical, in which event
such
Holders will be entitled to receive on a Pro Rata basis, out of the assets
of
the Trust available for distribution to the Holders, after satisfaction of
liabilities to creditors of the Trust to the extent not satisfied by the
Debenture Issuer, an amount in cash equal to the Liquidation Distribution.
An
early Liquidation of the Trust pursuant to clause (iv) of the immediately
preceding paragraph shall occur if the Institutional Trustee determines that
such Liquidation is possible by distributing, after satisfaction of liabilities
to creditors of Trust, to the Holders of the Securities on a Pro Rata basis,
the
Debentures, and such distribution occurs.
If,
upon
any such Liquidation, 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 the amounts payable directly by the Trust on
such
Capital Securities shall be paid to the Holders of the Securities on a Pro
Rata
basis, except that if an Event of Default has occurred and is continuing, the
Capital Securities shall have a preference over the Common Securities with
regard to such distributions.
Upon
any
such Liquidation of the Trust involving a distribution of the Debentures, if
at
the time of such Liquidation, the Capital Securities were rated by at least
one
nationally-recognized statistical rating organization, the Debenture Issuer
will
use its reasonable best efforts to obtain from at least one such or other rating
organization a rating for the Debentures.
After
the
date for any distribution of the Debentures upon dissolution of the Trust,
(i)
the Securities of the Trust will be deemed to be no longer outstanding, (ii)
any
certificates representing the Capital Securities will be deemed to represent
undivided beneficial interests in such of the Debentures as have an aggregate
principal amount equal to the aggregate stated liquidation amount of, with
an
interest rate identical to the distribution rate of, and bearing accrued and
unpaid interest equal to accrued and unpaid distributions on, the Securities
until such certificates are presented to the Debenture Issuer or its agent
for
transfer or reissuance (and until such certificates are so surrendered, no
payments of interest or principal shall be made to Holders of Securities in
respect of any payments due and payable under the Debentures) and (iii) all
rights of Holders of Securities under the Capital Securities or the Common
Securities, as applicable, shall cease, except the right of such Holders to
receive Debentures upon surrender of certificates representing such
Securities.
4.
Redemption
and Distribution
.
(a)
The
Debentures will mature on September 15, 2037 (“Maturity Date”) for an amount
equal to 100% of the principal amount thereof plus unpaid interest accrued
thereon to such date (“Maturity Redemption Price”). The Debentures may be
redeemed by the Debenture Issuer, in whole or in part, on any March 15, June
15,
September 15 or December 15 on or after September 15, 2012 at the Redemption
Price, upon not less than 30 nor more than 60 days’ notice to Holders of such
Debentures. In addition, upon the occurrence and continuation of a Tax Event
or
an Investment Company Event, the Debentures may be redeemed by the Debenture
Issuer in whole but not in part, at any time within 90 days following the
occurrence of such Tax Event or Investment Company Event, as the case may be
(the “Special Redemption Date”) at the Special Redemption Price, upon not less
than 30 nor more than 60 days’ notice to Holders of the Debentures so long as
such Tax Event or Investment Company Event, as the case may be, is continuing.
Additional interest may also be payable by the Debenture Issuer in connection
with such Tax Event or Investment Company Event as specified in
Section 10.02 of the Indenture. Any such interest received by the Trust
will be distributed promptly to Holders of the Securities on a
Pro
Rata
basis.
“Tax
Event” means the receipt by the Debenture Issuer and the Trust of an opinion of
counsel experienced in such matters to the effect that, as a result of any
amendment to or change (including any announced prospective change) in the
laws
or any regulations thereunder of the United States or any political subdivision
or taxing authority thereof or therein, or as a result of any official
administrative pronouncement (including any private letter ruling, technical
advice memorandum, regulatory procedure, notice or announcement) (an
“Administrative Action”) or judicial decision interpreting or applying such laws
or regulations, regardless of whether such Administrative Action or judicial
decision is issued to or in connection with a proceeding involving the Debenture
Issuer or the Trust and whether or not subject to review or appeal, which
amendment, clarification, change, Administrative Action or decision is enacted,
promulgated or announced, in each case on or after the date of original issuance
of the Debentures, there is more than an insubstantial risk that: (i) the Trust
is, or will be within 90 days of the date of such opinion, subject to United
States federal income tax with respect to income received or accrued on the
Debentures; (ii) interest payable by the Debenture Issuer on the Debentures
is
not, or within 90 days of the date of such opinion, will not be, deductible
by
the Debenture Issuer, in whole or in part, for United States federal income
tax
purposes; or (iii) the Trust is, or will be within 90 days of the date of such
opinion, subject to more than a de minimis amount of other taxes (including
withholding taxes), duties, assessments or other governmental
charges.
“Investment
Company Event” means the receipt by the Debenture Issuer and the Trust of an
opinion of counsel experienced in such matters to the effect that, as a result
of a change in law or regulation or written change in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority, there is more than an insubstantial risk that
the Trust is or, within 90 days of the date of such opinion will be, considered
an “investment company” that is required to be registered under the Investment
Company Act, which change or prospective change becomes effective or would
become effective, as the case may be, on or after the date of the original
issuance of the Debentures.
“Redemption
Date” means the date fixed for the redemption of Capital Securities, which shall
be any March 15, June 15, September 15 or December 15 on or after September
15,
2012.
“Redemption
Price” means 100% of the principal amount of the Debentures being redeemed plus
accrued and unpaid interest on such Debentures to the Redemption Date or, in
the
case of a redemption due to the occurrence of a Special Event, to the Special
Redemption Date if such Special Redemption Date is on or after September 15,
2012.
“Special
Event” means either a Tax Event or an Investment Company Event.
“Special
Redemption Price” means (1) if the Special Redemption Date is before September
15, 2012, 107.5% of the principal amount to be redeemed plus any accrued and
unpaid interest thereon to the date of such redemption and (2) if the Special
Redemption Date is on or after September 15, 2012, the Redemption Price for
such
Special Redemption Date.
(b)
Upon
the
repayment in full at maturity or redemption in whole or in part of the
Debentures (other than following the distribution of the Debentures to the
Holders of the Securities), the proceeds from such repayment or payment shall
concurrently be applied to redeem Pro Rata at the applicable Maturity Redemption
Price, Redemption Price, or Special Redemption Price for the Debentures, as
the
case may be, Securities having an aggregate liquidation amount equal to the
aggregate principal amount of the Debentures so repaid or redeemed;
provided
,
however
,
that
holders of such Securities shall be given not less than 30 nor more than 60
days’ prior written notice of such redemption (other than at the scheduled
maturity of the Debentures on the Maturity Date).
(c)
If
fewer
than all the outstanding Securities are to be so redeemed, the Common Securities
and the Capital Securities will be redeemed Pro Rata and the Capital Securities
to be redeemed will be as described in Section 4(e)(ii) below.
(d)
The
Trust
may not redeem fewer than all the outstanding Capital Securities unless all
accrued and unpaid Distributions have been paid on all Capital Securities for
all quarterly Distribution periods terminating on or before the date of
redemption.
(e)
Redemption
or Distribution Procedures.
(i)
Notice
of
any redemption of, or notice of distribution of the Debentures in exchange
for,
the Securities (a “Redemption/Distribution Notice”) will be given by the Trust
by mail to each Holder of Securities to be redeemed or exchanged not fewer
than
30 nor more than 60 days before the date fixed for redemption or exchange
thereof which, in the case of a redemption, will be the date fixed for
redemption of the Debentures. For purposes of the calculation of the date of
redemption or exchange and the dates on which notices are given pursuant to
this
Section 4(e)(i), a Redemption/Distribution Notice shall be deemed to be
given on the day such notice is first mailed by first-class mail, postage
prepaid, to Holders of such Securities. Each Redemption/Distribution Notice
shall be addressed to the Holders of such Securities at the address of each
such
Holder appearing on the books and records of the Registrar. No defect in the
Redemption/Distribution Notice or in the mailing thereof with respect to any
Holder shall affect the validity of the redemption or exchange proceedings
with
respect to any other Holder.
(ii)
In
the
event that fewer than all the outstanding Securities are to be redeemed, the
Securities to be redeemed shall be redeemed Pro Rata from each Holder of Capital
Securities.
(iii)
If
the
Securities are to be redeemed and the Trust gives a Redemption/Distribution
Notice, which notice may only be issued if the Debentures are redeemed as set
out in this Section 4 (which notice will be irrevocable), then, provided,
that the Institutional Trustee has a sufficient amount of cash in connection
with the related redemption or maturity of the Debentures, the Institutional
Trustee will pay the price payable upon redemption of the Securities to the
Holders of such Securities by check mailed to the address of each such Holder
appearing on the books and records of the Trust on the redemption date. If
a
Redemption/Distribution Notice shall have been given and funds deposited as
required, then immediately prior to the close of business on the date of such
deposit, Distributions will cease to accrue on the Securities so called for
redemption and all rights of Holders of such Securities so called for redemption
will cease, except the right of the Holders of such Securities to receive the
applicable price specified in Section 4(a). If any date of redemption of
Securities is not a Business Day, then payment of any such price payable on
such
date will be made on the next succeeding day that is a Business Day 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 fixed for redemption. If payment of the
Redemption Price in respect of any Securities is improperly withheld or refused
and not paid either by the Trust or by the Debenture Issuer as guarantor
pursuant to the Guarantee, Distributions on such Securities will continue to
accrue at the then applicable rate from the original redemption date to the
actual date of payment, in which case the actual payment date will be considered
the date fixed for redemption for purposes of calculating the price payable
upon
redemption of the Securities. The Trust shall not be required to (i) issue,
register the transfer of or exchange any Security during a period beginning
at
the opening of business 15 days before any selection for redemption of the
Securities and ending at the close of business on the earliest date on which
the
relevant notice of redemption is deemed to have been given to all Holders of
the
Securities to be so redeemed or (ii) register the transfer of or exchange any
Capital Securities so selected for redemption, in whole or in part, except
for
the unredeemed portion of any Capital Securities being redeemed in
part.
(iv)
Redemption/Distribution
Notices shall be sent by the Administrators on behalf of the Trust (A) in
respect of the Capital Securities, to the Holders thereof, and (B) in respect
of
the Common Securities, to the Holder thereof.
(v)
Subject
to the foregoing and applicable law (including, without limitation, United
States federal securities laws), and
provided
,
that
the acquiror is not the Holder of the Common Securities or the obligor under
the
Indenture, the Sponsor or any of its subsidiaries may at any time and from
time
to time purchase outstanding Capital Securities by tender, in the open market
or
by private agreement.
5.
Voting
Rights - Capital Securities
.
(a)
Except as provided under Sections 5(b) and 7 and as otherwise required by law
and the Declaration, the Holders of the Capital Securities will have no voting
rights. The Administrators are required to call a meeting of the Holders of
the
Capital Securities if directed to do so by Holders of not less than 10% in
liquidation amount of the Capital Securities.
(b)
Subject
to the requirements of obtaining a tax opinion by the Institutional Trustee
in
certain circumstances set forth in the last sentence of this paragraph, the
Holders of a Majority in liquidation amount of the Capital Securities, voting
separately as a class, have the right to direct the time, method, and place
of
conducting any proceeding for any remedy available to the Institutional Trustee,
or exercising any trust or power conferred upon the Institutional Trustee under
the Declaration, including the right to direct the Institutional Trustee, as
holder of the Debentures, to (i) exercise the remedies available under the
Indenture as the holder of the Debentures, (ii) waive any past default that
is
waivable under 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 on behalf of all the Holders
of the Capital Securities to any amendment, modification or termination of
the
Indenture or the Debentures where such consent shall be required;
provided
,
however
,
that,
where a consent or action under the Indenture would require the consent or
act
of the holders of greater than a simple majority in principal amount of
Debentures (a “Super Majority”) affected thereby, the Institutional Trustee may
only give such consent or take such action at the written direction of the
Holders of not less than the proportion in liquidation amount of the Capital
Securities outstanding which the relevant Super Majority represents of the
aggregate principal amount of the Debentures outstanding. If the Institutional
Trustee fails to enforce its rights under the Debentures after the Holders
of a
Majority in liquidation amount of such Capital Securities have so directed
the
Institutional Trustee, to the fullest extent permitted by law, a Holder of
the
Capital Securities may institute a legal proceeding directly against the
Debenture Issuer to enforce the Institutional Trustee’s rights under the
Debentures without first instituting any legal proceeding against the
Institutional Trustee or any other person or entity. Notwithstanding the
foregoing, if an Event of Default has occurred and is continuing and such event
is attributable to the failure of the Debenture Issuer to pay interest or
premium, if any, on or principal of the Debentures on the date the interest
premium, if any, or principal is payable (or in the case of redemption, the
redemption date), then a Holder of record of the Capital Securities may directly
institute a proceeding for enforcement of payment, on or after the respective
due dates specified in the Debentures, to such Holder directly of the principal
of or premium, if any, or interest on the Debentures having an aggregate
principal amount equal to the aggregate liquidation amount of the Capital
Securities of such Holder. The Institutional Trustee shall notify all Holders
of
the Capital Securities of any default actually known to the Institutional
Trustee with respect to the Debentures unless (x) such default has been cured
prior to the giving of such notice or (y) the Institutional Trustee determines
in good faith that the withholding of such notice is in the interest of the
Holders of such Capital Securities, except where the default relates to the
payment of principal of or premium, if any, or interest on any of the
Debentures. Such notice shall state that such Indenture Event of Default also
constitutes an Event of Default hereunder. Except with respect to directing
the
time, method and place of conducting a proceeding for a remedy, the
Institutional Trustee shall not take any of the actions described in clause
(i),
(ii), (iii) or (iv) above unless the Institutional Trustee has obtained an
opinion of tax counsel to the effect that, as a result of such action, the
Trust
will not be classified as other than a grantor trust for United States federal
income tax purposes.
In
the
event the consent of the Institutional Trustee, as the holder of the Debentures
is required under the Indenture with respect to any amendment, modification
or
termination of the Indenture, the Institutional Trustee shall request the
written direction of the Holders of the Securities with respect to such
amendment, modification or termination and shall vote with respect to such
amendment, modification or termination as directed by a Majority in liquidation
amount of the Securities voting together as a single class;
provided
,
however
,
that
where a consent under the Indenture would require the consent of a Super
Majority, the Institutional Trustee may only give such consent at the written
direction of the Holders of not less than the proportion in liquidation amount
of such Securities outstanding which the relevant Super Majority represents
of
the aggregate principal amount of the Debentures outstanding. The Institutional
Trustee shall not take any such action in accordance with the written directions
of the Holders of the Securities unless the Institutional Trustee has obtained
an opinion of tax counsel to the effect that, as a result of such action, the
Trust will not be classified as other than a grantor trust for United States
federal income tax purposes.
A
waiver
of an Indenture Event of Default will constitute a waiver of the corresponding
Event of Default hereunder. Any required approval or direction of Holders of
the
Capital Securities may be given at a separate meeting of Holders of the Capital
Securities convened for such purpose, at a meeting of all of the Holders of
the
Securities in the Trust or pursuant to written consent. The Institutional
Trustee will cause a notice of any meeting at which Holders of the Capital
Securities are entitled to vote, or of any matter upon which action by written
consent of such Holders is to be taken, to be mailed to each Holder of record
of
the Capital Securities. Each such notice will include a statement setting forth
the following information (i) the date of such meeting or the date by which
such
action is to be taken, (ii) a description of any resolution proposed for
adoption at such meeting on which such Holders are entitled to vote or of such
matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents. No vote or consent of the Holders of the
Capital Securities will be required for the Trust to redeem and cancel Capital
Securities or to distribute the Debentures in accordance with the Declaration
and the terms of the Securities.
Notwithstanding
that Holders of the Capital Securities are entitled to vote or consent under
any
of the circumstances described above, any of the Capital Securities that are
owned by the Sponsor or any Affiliate of the Sponsor shall not entitle the
Holder thereof to vote or consent and shall, for purposes of such vote or
consent, be treated as if such Capital Securities were not
Outstanding.
In
no
event will Holders of the Capital Securities have the right to vote to appoint,
remove or replace the Administrators, which voting rights are vested exclusively
in the Sponsor as the Holder of all of the Common Securities of the Trust.
Under
certain circumstances as more fully described in the Declaration, Holders of
Capital Securities have the right to vote to appoint, remove or replace the
Institutional Trustee and the Delaware Trustee.
6.
Voting
Rights - Common Securities
.
(a)
Except as provided under Sections 6(b), 6(c) and 7 and as otherwise required
by
law and the Declaration, the Common Securities will have no voting
rights.
(b)
The
Holders of the Common Securities are entitled, in accordance with Article IV
of
the Declaration, to vote to appoint, remove or replace any
Administrators.
(c)
Subject
to Section 6.8 of the Declaration and only after each Event of Default (if
any) with respect to the Capital Securities has been cured, waived or otherwise
eliminated and subject to the requirements of the second to last sentence of
this paragraph, the Holders of a Majority in liquidation amount of the Common
Securities, voting separately as a class, may direct the time, method, and
place
of conducting any proceeding for any remedy available to the Institutional
Trustee, or exercising any trust or power conferred upon the Institutional
Trustee under the Declaration, including (i) directing the time, method, place
of conducting any proceeding for any remedy available to the Debenture Trustee,
or exercising any trust or power conferred on the Debenture Trustee with respect
to the Debentures, (ii) waiving any past default and its consequences that
are
waivable under the Indenture, or (iii) exercising any right to rescind or annul
a declaration that the principal of all the Debentures shall be due and payable,
provided, however, that, where a consent or action under the Indenture would
require a Super Majority, the Institutional Trustee may only give such consent
or take such action at the written direction of the Holders of not less than
the
proportion in liquidation amount of the Common Securities which the relevant
Super Majority represents of the aggregate principal amount of the Debentures
outstanding. Notwithstanding this Section 6(c), the Institutional Trustee
shall not revoke any action previously authorized or approved by a vote or
consent of the Holders of the Capital Securities. Other than with respect to
directing the time, method and place of conducting any proceeding for any remedy
available to the Institutional Trustee or the Debenture Trustee as set forth
above, the Institutional Trustee shall not take any action described in clause
(i), (ii) or (iii) above, unless the Institutional Trustee has obtained an
opinion of tax counsel to the effect that for the purposes of United States
federal income tax the Trust will not be classified as other than a grantor
trust on account of such action. If the Institutional Trustee fails to enforce
its rights under the Declaration, to the fullest extent permitted by law any
Holder of the Common Securities may institute a legal proceeding directly
against any Person to enforce the Institutional Trustee’s rights under the
Declaration, without first instituting a legal proceeding against the
Institutional Trustee or any other Person.
Any
approval or direction of Holders of the Common Securities may be given at a
separate meeting of Holders of the Common Securities convened for such purpose,
at a meeting of all of the Holders of the Securities in the Trust or pursuant
to
written consent. The Administrators will cause a notice of any meeting at which
Holders of the Common Securities are entitled to vote, or of any matter upon
which action by written consent of such Holders is to be taken, to be mailed
to
each Holder of the Common Securities. Each such notice will include a statement
setting forth (i) the date of such meeting or the date by which such action
is
to be taken, (ii) a description of any resolution proposed for adoption at
such
meeting on which such Holders are entitled to vote or of such matter upon which
written consent is sought and (iii) instructions for the delivery of proxies
or
consents.
No
vote
or consent of the Holders of the Common Securities will be required for the
Trust to redeem and cancel Common Securities or to distribute the Debentures
in
accordance with the Declaration and the terms of the Securities.
7.
Amendments
to Declaration and Indenture
.
(a) In
addition to any requirements under Section 11.1 of the Declaration, if any
proposed amendment to the Declaration provides for, or the Trustees otherwise
propose to effect, (i) any action that would adversely affect the powers,
preferences or special rights of the Securities, whether by way of amendment
to
the Declaration or otherwise, or (ii) the Liquidation of the Trust, other than
as described in Section 7.1 of the Declaration, then the Holders of
outstanding Securities, voting together as a single 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 not less than a Majority
in
liquidation amount of the Securities affected thereby; provided, however, if
any
amendment or proposal referred to in clause (i) above would adversely affect
only the Capital Securities or only the Common Securities, then only the
affected 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 a
Majority in liquidation amount of such class of Securities.
(b)
In
the
event the consent of the Institutional Trustee as the holder of the Debentures
is required under the Indenture with respect to any amendment, modification
or
termination of the Indenture or the Debentures, the Institutional Trustee shall
request the written direction of the Holders of the Securities with respect
to
such amendment, modification or termination and shall vote with respect to
such
amendment, modification, or termination as directed by a Majority in liquidation
amount of the Securities voting together as a single class; provided, however,
that where a consent under the Indenture would require a Super Majority, the
Institutional Trustee may only give such consent at the written direction of
the
Holders of not less than the proportion in liquidation amount of the Securities
which the relevant Super Majority represents of the aggregate principal amount
of the Debentures outstanding.
(c)
Notwithstanding
the foregoing, no amendment or modification may be made to the Declaration
if
such amendment or modification would (i) cause the Trust to be classified for
purposes of United States federal income taxation as other than a grantor trust,
(ii) reduce or otherwise adversely affect the powers of the Institutional
Trustee or (iii) cause the Trust to be deemed an “investment company” which is
required to be registered under the Investment Company Act.
(d)
Notwithstanding
any provision of the Declaration, the right of any Holder of the Capital
Securities to receive payment of Distributions and other payments upon
redemption, Liquidation or otherwise, on or after their respective due dates,
or
to institute a suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of
such
Holder. For the protection and enforcement of the foregoing provision, each
and
every Holder of the Capital Securities shall be entitled to such relief as
can
be given either at law or equity.
8.
Pro
Rata
.
A
reference in these terms of the Securities to any payment, distribution or
treatment as being “Pro Rata” shall mean pro rata to each Holder of the
Securities according to the aggregate liquidation amount of the Securities
held
by the relevant Holder in relation to the aggregate liquidation amount of all
Securities outstanding unless, in relation to a payment, an Event of Default
has
occurred and is continuing, in which case any funds available to make such
payment shall be paid first to each Holder of the Capital Securities Pro Rata
according to the aggregate liquidation amount of the Capital Securities held
by
the relevant Holder relative to the aggregate liquidation amount of all Capital
Securities outstanding, and only after satisfaction of all amounts owed to
the
Holders of the Capital Securities, to each Holder of the Common Securities
Pro
Rata according to the aggregate liquidation amount of the Common Securities
held
by the relevant Holder relative to the aggregate liquidation amount of all
Common Securities outstanding.
9.
Ranking
.
The
Capital Securities rank
pari
passu
with,
and payment thereon shall be made Pro Rata with, the Common Securities except
that, where an Event of Default has occurred and is continuing, the rights
of
Holders of the Common Securities to receive payment of Distributions and
payments upon Liquidation, redemption and otherwise are subordinated to the
rights of the Holders of the Capital Securities with the result that no payment
of any Distribution on, or any amount payable upon the redemption of, any Common
Security, and no payment to the Holder of any Common Security on account of
the
Liquidation of the Trust, shall be made unless payment in full in cash of (i)
all accrued and unpaid Distributions on all outstanding Capital Securities
for
all Distribution Periods terminating on or prior thereto, (ii) all amounts
payable upon Capital Securities then subject to redemption, and (iii) all
amounts payable upon Capital Securities in the event of the Liquidation of
the
Trust, in each case, shall have been made or provided for, and all funds
immediately available to the Institutional Trustee shall first be applied to
the
payment in full in cash of the amounts specified in clause (i), (ii) and (iii)
above that are then due and payable.
10.
Acceptance
of Guarantee and Indenture
.
Each
Holder of the Capital Securities and the Common Securities, by the acceptance
of
such Securities, agrees to the provisions of the Guarantee, including the
subordination provisions therein and to the provisions of the
Indenture.
11.
No
Preemptive Rights
.
The
Holders of the Securities shall have no, and the issuance of the Securities
is
not subject to, preemptive or similar rights to subscribe for any additional
securities.
12.
Miscellaneous
.
These
terms constitute a part of the Declaration. The Sponsor will provide a copy
of
the Declaration, the Guarantee, and the Indenture to a Holder without charge
on
written request to the Sponsor at its principal place of business.
EXHIBIT
A-1
FORM
OF CAPITAL SECURITY CERTIFICATE
[FORM
OF
FACE OF SECURITY]
THIS
CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY WITHIN THE MEANING OF THE
DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY (“DTC”) OR A NOMINEE OF DTC. THIS CAPITAL SECURITY IS
EXCHANGEABLE FOR CAPITAL SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER
THAN DTC OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
DECLARATION, AND NO TRANSFER OF THIS CAPITAL SECURITY (OTHER THAN A TRANSFER
OF
THIS CAPITAL SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE
OF
DTC TO DTC OR ANOTHER NOMINEE OF DTC) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.
UNLESS
THIS CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO
«TRUSTNAME» OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CAPITAL SECURITY ISSUED IS REGISTERED AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO SUCH OTHER ENTITY
AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION
IS
EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL
OR OTHERWISE TRANSFER SUCH SECURITY PRIOR TO THE DATE WHICH IS THE LATER OF
(i)
TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER
THE
SECURITIES ACT) AFTER THE LATER OF (Y) THE DATE OF ORIGINAL ISSUANCE HEREOF
AND
(Z) THE LAST DATE ON WHICH THE TRUST OR ANY AFFILIATE (AS DEFINED IN RULE 405
UNDER THE SECURITIES ACT) OF THE TRUST WAS THE HOLDER OF THIS SECURITY OR SUCH
INTEREST OR PARTICIPATION (OR ANY PREDECESSOR THERETO) AND (ii) SUCH LATER
DATE,
IF ANY, AS MAY BE REQUIRED BY ANY SUBSEQUENT CHANGE IN APPLICABLE LAW, ONLY
(A)
TO THE DEBENTURE ISSUER OR THE TRUST, (B) PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT (“RULE 144A”), TO A PERSON THE HOLDER REASONABLY BELIEVES IS A
“QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE
IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT
TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO
AN
“ACCREDITED INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (a)(1), (2), (3), (7)
OR (8) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY
FOR
ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF AN “ACCREDITED INVESTOR,” FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, (D) PURSUANT TO OFFERS AND
SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES PURSUANT TO
REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT
TO
THE DEBENTURE ISSUER’S AND THE TRUST’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER PURSUANT TO CLAUSES (C) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION
OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM
IN
ACCORDANCE WITH THE AMENDED AND RESTATED DECLARATION OF TRUST, A COPY OF WHICH
MAY BE OBTAINED FROM THE DEBENTURE ISSUER OR THE TRUST. THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF AGREES THAT IT WILL COMPLY WITH THE FOREGOING
RESTRICTIONS.
THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES, REPRESENTS AND WARRANTS
THAT IT WILL NOT ENGAGE IN HEDGING TRANSACTIONS INVOLVING THIS SECURITY UNLESS
SUCH TRANSACTIONS ARE IN COMPLIANCE WITH THE SECURITIES ACT.
THE
HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND
WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT
OR
OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (EACH A “PLAN”), OR AN ENTITY
WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT
IN THE ENTITY AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR
HOLD THIS SECURITY OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER
IS
ELIGIBLE FOR THE EXEMPTION RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR
PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR
ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SECURITY IS
NOT
PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT
TO
SUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS SECURITY OR ANY
INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING
THEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING
OF
SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS
APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE
BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE WILL NOT
RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975
OF
THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVE
EXEMPTION.
IN
CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS MAY BE REQUIRED BY
THE
AMENDED AND RESTATED DECLARATION OF TRUST TO CONFIRM THAT THE TRANSFER COMPLIES
WITH THE FOREGOING RESTRICTIONS.
THIS
SECURITY WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING A
LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS
THEREOF. ANY ATTEMPTED TRANSFER OF THIS SECURITY IN A BLOCK HAVING A LIQUIDATION
AMOUNT OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT
WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER
OF THIS SECURITY FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT
OF
DISTRIBUTIONS ON THIS SECURITY, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED
TO
HAVE NO INTEREST WHATSOEVER IN THIS SECURITY.
|
[P-001]
|
Number
of Capital Securities 25,000
|
CUSIP
No.
_____________
Certificate
Evidencing Capital Securities
of
Hallmark
Statutory Trust II
(liquidation
amount $1,000 per Capital Security)
Hallmark
Statutory Trust II, a statutory trust created under the laws of the State of
Delaware (the “Trust”), hereby certifies that Cede & Co., as nominee on
behalf of The Depository Trust Company (the “Holder”), is the registered owner
of 25,000 capital securities of the Trust representing undivided beneficial
interests in the assets of the Trust, (liquidation amount $1,000 per Capital
Security) (the “Capital Securities”). Subject to the Declaration (as defined
below), the Capital Securities are transferable on the books and records of
the
Trust, in person or by a duly authorized attorney, upon surrender of this
Certificate duly endorsed and in proper form for transfer. The Capital
Securities represented hereby are issued pursuant to, and the designation,
rights, privileges, restrictions, preferences and other terms and provisions
of
the Capital Securities shall in all respects be subject to, the provisions
of
the Amended and Restated Declaration of Trust of the Trust, dated as of August
23, 2007 (the “Declaration”), among Mark Schwartz and Mark Morrison, as
Administrators, The Bank of New York (Delaware), as Delaware Trustee, The Bank
of New York Trust Company, National Association, as Institutional Trustee,
Hallmark Financial Services, Inc., as Sponsor, including the designation of
the
terms of the Capital Securities as set forth in Annex I to the Declaration,
as
the same may be amended from time to time. Capitalized terms used herein but
not
defined shall have the meaning given them in the Declaration. The Holder is
entitled to the benefits of the Guarantee and the Indenture to the extent
provided therein. The Sponsor will provide a copy of the Declaration, the
Guarantee, and the Indenture to the Holder without charge upon written request
to the Sponsor at its principal place of business.
By
acceptance of this Certificate, the Holder is bound by the Declaration and
is
entitled to the benefits thereunder.
By
acceptance of this Certificate, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness of the Debenture
Issuer and the Capital Securities as evidence of beneficial ownership in the
Debentures.
This
Certificate and the Capital Securities evidenced hereby are governed by, and
shall be construed in accordance with, the laws of the State of Delaware,
without regard to principles of conflict of laws.
IN
WITNESS WHEREOF, the Trust has duly executed this certificate.
|
|
|
|
Hallmark
Statutory Trust II
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
Administrator
|
|
Dated:
|
|
|
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Capital Securities referred to in the within-mentioned
Declaration.
|
|
|
|
THE
BANK OF NEW YORK TRUST COMPANY, NATIONAL ASSOCIATION, not in its
individual capacity but solely as the Institutional
Trustee
|
|
|
|
|
By:
|
|
|
|
|
|
Dated
|
|
|
[FORM
OF
REVERSE OF SECURITY]
Distributions
payable on each Capital Security will be payable at a fixed rate of 8.28% (the
“Fixed Rate”) until September 15, 2017 (the “Fixed Rate Period”) and thereafter
at a variable per annum rate of interest, reset quarterly, equal to LIBOR (as
defined in the Declaration) plus 2.90% (the “Coupon Rate”), of the stated
liquidation amount of $1,000 per Capital Security (provided, however, that
the
Coupon Rate, defined to include the Fixed Rate and Variable Rate, as applicable,
for any Distribution Period, may not exceed the highest rate permitted by New
York law, as the same may be modified by United States law of general
applicability), such Coupon Rate being the rate of interest payable on the
Debentures to be held by the Institutional Trustee. Distributions in arrears
for
more than one Distribution Period will bear interest thereon compounded
quarterly at the applicable Coupon Rate for each such Distribution Period (to
the extent permitted by applicable law). The term “Distributions” as used herein
includes cash distributions, any such compounded distributions and any
Additional Interest payable on the Debentures unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect
of
the Debentures held by the Institutional Trustee and to the extent the
Institutional Trustee has funds legally available in the Property Account
therefor. During the Fixed Rate Period, the amount of Distributions payable
for
any period will be computed for any full quarterly Distribution Period on the
basis of a 360-day year of twelve 30-day months and the amount payable for
any
partial period shall be computed on the basis of the number of days elapsed
in a
360-day year of twelve 30-day month. Upon expiration of the Fixed Rate Period,
Distributions will be computed on the basis of a 360-day year and the actual
number of days elapsed in the relevant Distribution Period.
Except
as
otherwise described below, Distributions on the Capital Securities will be
cumulative, will accrue from the date of original issuance and will be payable
quarterly in arrears on March 15, June 15, September 15 and December 15 of
each
year, commencing on September 15, 2007 (each, a “Distribution Payment Date”).
Upon submission of Notice, the Debenture Issuer has the right under the
Indenture to defer payments of interest on the Debentures by extending the
interest payment period for up to 20 consecutive quarterly periods (each such
extended interest payment period together with all previous and future
consecutive extensions thereof, is referred to herein as an “Extension Period”)
at any time and from time to time on the Debentures, subject to the conditions
set forth in the Indenture, during which Extension Period no interest shall
be
due and payable (except any Additional Interest that may be due and payable).
During any Extension Period, interest will continue to accrue on the Debentures,
and interest on such accrued interest (such accrued interest and interest
thereon referred to herein as “Deferred Interest”) will accrue at an annual rate
set forth in the Indenture, compounded quarterly from the date such Deferred
Interest would have been payable were it not for the Extension Period, to the
extent permitted by law. No Extension Period may end on a date other than a
Distribution Payment Date. At the end of any such Extension Period, the
Debenture Issuer shall pay all Deferred Interest then accrued and unpaid on
the
Debentures;
provided
,
however
,
that no
Extension Period may extend beyond the Maturity Date, any Redemption Date or
Special Redemption Date. If Distributions are deferred, the Distributions due
shall be paid on the date that the related Extension Period terminates to
Holders of the Securities as they appear on the books and records of the Trust
on the record date immediately preceding such date. Distributions on the
Securities must be paid on the dates payable (after giving effect to any
Extension Period) to the extent that the Trust has funds legally available
for
the payment of such distributions in the Property Account of the Trust. The
Trust’s funds available for Distribution to the Holders of the Securities will
be limited to payments received from the Debenture Issuer. The payment of
Distributions out of moneys held by the Trust is guaranteed by the Guarantor
pursuant to the Guarantee.
The
Capital Securities shall be redeemable as provided in the
Declaration.
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned assigns and transfers this Capital Security
Certificate to:
_______________________
_______________________
_______________________
(Insert
assignee’s social security or tax identification number)
_______________________
_______________________
_______________________
(Insert
address and zip code of assignee),
and
irrevocably
appoints ________________________________________________________________________
as
agent
to transfer this Capital Security Certificate on the books of the Trust. The
agent may substitute another to act for it, him or her.
(Sign
exactly as your name appears on the other side of this Capital Security
Certificate)
1
Signature must be guaranteed by an “eligible guarantor institution” that is a
bank, stockbroker, savings and loan association or credit union meeting
the
requirements of the Security registrar, which requirements include membership
or
participation in the Securities Transfer Agents Medallion Program (“STAMP”) or
such other “signature guarantee program” as may be determined by the Security
registrar in addition to, or in substitution for, STAMP, all in accordance
with
the Securities Exchange Act of 1934, as amended.
EXHIBIT
A-2
FORM
OF
COMMON SECURITY CERTIFICATE
THIS
COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAWS
AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT
TO AN EXEMPTION FROM REGISTRATION.
EXCEPT
AS
SET FORTH IN SECTION 8.1 (b) OF THE DECLARATION (AS DEFINED BELOW), THIS
SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED.
|
[C-001]
|
Number
of Common Securities 774
|
Certificate
Evidencing Common Securities
of
Hallmark
Statutory Trust II
Hallmark
Statutory Trust II, a statutory trust created under the laws of the State of
Delaware (the “Trust”), hereby certifies that Hallmark Financial Services, Inc.
(the “Holder”) is the registered owner of 774 common securities of the Trust
representing undivided beneficial interests in the assets of the Trust
(liquidation amount $1,000 per Common Security)(the “Common Securities”). The
Common Securities represented hereby are issued pursuant to, and the
designation, rights, privileges, restrictions, preferences and other terms
and
provisions of the Common Securities shall in all respects be subject to, the
provisions of the Amended and Restated Declaration of Trust of the Trust, dated
as of August 23, 2007 among Mark Schwartz and Mark Morrison, as Administrators,
The Bank of New York (Delaware), as Delaware Trustee, The Bank of New York
Trust
Company, National Association, as Institutional Trustee, the Holder, as Sponsor,
including the designation of the terms of the Common Securities as set forth
in
Annex I to the Declaration, as the same may be amended from time to time (the
“Declaration”). Capitalized terms used herein but not defined shall have the
meaning given them in the Declaration. The Sponsor will provide a copy of the
Declaration and the Indenture to the Holder without charge upon written request
to the Sponsor at its principal place of business.
As
set
forth in the Declaration, when an Event of Default has occurred and is
continuing, the rights of Holder of Common Securities to payment in respect
of
Distributions and payments upon Liquidation, redemption or otherwise are
subordinated to the rights of payment of holders of the Capital
Securities.
By
acceptance of this Certificate, the Holder is bound by the Declaration and
is
entitled to the benefits thereunder.
By
acceptance of this Certificate, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness of the Debenture
Issuer and the Common Securities as evidence of undivided beneficial ownership
in the Debentures.
This
Certificate and the Common Securities evidenced hereby are governed by, and
shall be construed in accordance with, the laws of the State of Delaware,
without regard to principles of conflict of laws.
IN
WITNESS WHEREOF, the Trust has executed this Certificate as of this _____ day
of
_______________, 2007.
|
|
|
|
Hallmark
Statutory Trust II
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
|
[FORM
OF
REVERSE OF SECURITY]
Distributions
payable on each Common Security will be identical in amount to the Distributions
payable on each Capital Security, which is at a fixed rate of 8.28% (the “Fixed
Rate”) per annum until September 15, 2017 (the “Fixed Rate Period”) and
thereafter at a variable per annum rate of interest, reset quarterly, equal
to
LIBOR (as defined in the Declaration) plus 2.90% (the “Variable Rate”) of the
stated liquidation amount of $1,000 per Capital Security (provided, however,
that the Coupon Rate, defined to include the Fixed Rate and Variable Rate,
as
applicable, for any Distribution Period may not exceed the highest rate
permitted by New York law, as the same may be modified by United States law
of
general applicability), such Coupon rate being the rate of interest payable
on
the Debentures to be held by the Institutional Trustee. Distributions in arrears
for more than one Distribution Period will bear interest thereon compounded
quarterly at the applicable Coupon Rate for each such Distribution Period (to
the extent permitted by applicable law). The term “Distributions” as used herein
includes cash distributions, any such compounded distributions and any
Additional Interest payable on the Debentures unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect
of
the Debentures held by the Institutional Trustee and to the extent the
Institutional Trustee has funds legally available in the Property Account
therefor. During the Fixed Rate Period, the amount of Distributions payable
for
any period will be computed for any full quarterly Distribution Period on the
basis of a 360-day year of twelve 30-day months and the amount payable for
any
partial period shall be computed on the basis of the number of days elapsed
in a
360-day year of twelve 30-day month. Upon expiration of the Fixed Rate Period,
Distributions will be computed on the basis of a 360-day year and the actual
number of days elapsed in the relevant Distribution Period.
Except
as
otherwise described below, Distributions on the Common Securities will be
cumulative, will accrue from the date of original issuance and will be payable
quarterly in arrears on March 15, June 15, September 15 and December 15 of
each
year, commencing on September 15, 2007 (each, a “Distribution Payment Date”).
Upon submission of Notice, the Debenture Issuer has the right under the
Indenture to defer payments of interest on the Debentures by extending the
interest payment period for up to 20 consecutive quarterly periods (each such
extended interest payment period, together with all previous and future
consecutive extensions thereof, is referred to herein as an “Extension Period”)
at any time and from time to time on the Debentures, subject to the conditions
set forth in the Indenture, during which Extension Period no interest shall
be
due and payable (except any Additional Interest that may be due and payable).
During any Extension Period, interest will continue to accrue on the Debentures,
and interest on such accrued interest (such accrued interest and interest
thereon referred to herein as “Deferred Interest”) will accrue at an annual rate
set forth in the Indenture, compounded quarterly from the date such Deferred
Interest would have been payable were it not for the Extension Period, to the
extent permitted by law. No Extension Period may end on a date other than a
Distribution Payment Date. At the end of any such Extension Period, the
Debenture Issuer shall pay all Deferred Interest then accrued and unpaid on
the
Debentures; provided, however, that no Extension Period may extend beyond the
Maturity Date, and Redemption Date or Special Redemption Date. If Distributions
are deferred, the Distributions due shall be paid on the date that the related
Extension Period terminates to Holders of the Securities as they appear on
the
books and records of the Trust on the record date immediately preceding such
date.
Distributions
on the Securities must be paid on the dates payable (after giving effect to
any
Extension Period) to the extent that the Trust has funds legally available
for
the payment of such distributions in the Property Account of the Trust. The
Trust’s funds legally available for Distribution to the Holders of the
Securities will be limited to payments received from the Debenture Issuer.
The
payment of Distributions out of moneys held by the Trust is guaranteed by the
Guarantor pursuant to the Guarantee.
The
Common Securities shall be redeemable as provided in the
Declaration.
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned assigns and transfers this Common Security Certificate
to:
_______________________
_______________________
_______________________
(Insert
assignee’s social security or tax identification number)
_______________________
_______________________
_______________________
(Insert
address and zip code of assignee),
and
irrevocably appoints ________ as agent to transfer this Common Security
Certificate on the books of the Trust. The agent may substitute another to
act
for him or her.
(Sign
exactly as your name appears on the other side of this Common Security
Certificate)
1
Signature must be guaranteed by an “eligible guarantor institution” that is a
bank, stockbroker, savings and loan association or credit union, meeting
the
requirements of the Security registrar, which requirements include membership
or
participation in the Securities Transfer Agents Medallion Program (“STAMP”) or
such other “signature guarantee program” as may be determined by the Security
registrar in addition to, or in substitution for, STAMP, all in accordance
with
the Securities Exchange Act of 1934, as amended.
EXHIBIT
B
Form
of Transferee Certificate
to
be Executed by Transferees other than QIB/QPs for Non-Global
Securities
__________,
[ ]
The
Bank
of New York Trust Company, National Association
601
Travis, 16th Floor
Houston,
Texas 77002
Attention:
Global Corporate Trust - Hallmark Statutory Trust II
Hallmark
Financial Services, Inc.
Hallmark
Statutory Trust II
777
Main
Street, Suite 1000
Fort
Worth, Texas 76102
|
Re:
|
Purchase
of $____________ stated liquidation amount of Floating Rate Preferred
Securities (the “Capital Securities”) of Hallmark Statutory Trust
II
|
Ladies
and Gentlemen:
In
connection with our purchase of the Capital Securities we confirm
that:
1.
We
understand that the Floating Rate Capital Securities (the “Capital Securities”)
of Hallmark Statutory Trust II (the “Trust”) (including the guarantee (the
“Guarantee”) of Hallmark Financial Services, Inc. (the “Sponsor”) executed in
connection therewith) and the Floating Rate Junior Subordinated Debentures
due
September 15, 2037 of the Sponsor (the “Subordinated Debentures”) (the entire
amount of the Trust’s outstanding Capital Securities, the Guarantee and the
Subordinated Debentures together being referred to herein as the “Offered
Securities”), have not been registered under the Securities Act of 1933, as
amended (the “Securities Act”), and may not be offered or sold except as
permitted in the following sentence. We agree on our own behalf and on behalf
of
any investor account for which we are purchasing the Offered Securities that,
if
we decide to offer, sell or otherwise transfer any such Offered Securities,
(i)
such offer, sale or transfer will be made only (a) to the Trust, (b) to an
institutional “accredited investor” within the meaning of subparagraph (a) (1),
(2), (3) or (7) of Rule 501 under the Securities Act that is acquiring Offered
Securities for its own account, or for the account of such an “accredited
investor,” for investment purposes and not with a view to, or for offer or sale
in connection with, any distribution thereof in violation of the Securities
Act,
(c) pursuant to an effective registration statement under the Securities Act,
or
(d) pursuant to an exemption from the Securities Act, in each case in accordance
with any applicable securities laws of any state of the United States or any
other applicable jurisdiction and, in the case of (b) or (d), subject to the
right of the Trust and the Sponsor to require an Opinion of Counsel and other
information satisfactory to each of them. The foregoing restrictions on resale
will not apply subsequent to the date on which, in the written Opinion of
Counsel, the Capital Securities are not “restricted securities” within the
meaning of Rule 144 under the Securities Act. If any resale or other transfer
of
the Offered Securities is proposed to be made pursuant to clause (b) or (d)
above, the transferor shall deliver a letter from the transferee substantially
in the form of this letter to the Institutional Trustee as Registrar, which
shall provide as applicable, among other things, that the transferee is an
“accredited investor” within the meaning of subparagraph (a) (1), (2), (3) or
(7) of Rule 501 under the Securities Act that is acquiring such Securities
for
investment purposes and not for distribution in violation of the Securities
Act.
We acknowledge on our behalf and on behalf of any investor account for which
we
are purchasing Securities that the Trust and the Sponsor reserve the right
prior
to any offer, sale or other transfer pursuant to clause (b) or (d) to require
the delivery of any Opinion of Counsel, certifications and/or other information
satisfactory to the Trust and the Sponsor. We understand that the certificates
for any Offered Security that we receive will bear a legend substantially to
the
effect of the foregoing.
2.
We
are an
“accredited investor” within the meaning of subparagraph (a) (1), (2), (3) or
(7) of Rule 501 under the Securities Act purchasing for our own account or
for
the account of such an “accredited investor,” and we are acquiring the Offered
Securities for investment purposes and not with view to, or for offer or sale
in
connection with, any distribution in violation of the Securities Act, and we
have such knowledge and experience in financial and business matters as to
be
capable of evaluating the merits and risks of our investment in the Offered
Securities, and we and any account for which we are acting are each able to
bear
the economic risks of our or its investment.
3.
We
are
acquiring the Offered Securities purchased by us for our own account (or for
one
or more accounts as to each of which we exercise sole investment discretion
and
have authority to make, and do make, the statements contained in this letter)
and not with a view to any distribution of the Offered Securities, subject,
nevertheless, to the understanding that the disposition of our property will
at
all times be and remain within our control.
4.
In
the
event that we purchase any Capital Securities or any Subordinated Debentures,
we
will acquire such Capital Securities having an aggregate stated liquidation
amount of not less than $100,000 or such Subordinated Debentures having an
aggregate principal amount not less than $100,000, for our own account and
for
each separate account for which we are acting.
5.
We
acknowledge that we are not a fiduciary of (i) an employee benefit, individual
retirement account or other plan or arrangement subject to Title I of the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), or
Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”)
(each a “Plan”); or (ii) an entity whose underlying assets include “plan assets”
by reason of any Plan’s investment in the entity, and are not purchasing any of
the Offered Securities on behalf of or with “plan assets” by reason of any
Plan’s investment in the entity.
6.
We
acknowledge that the Trust and the Sponsor and others will rely upon the truth
and accuracy of the foregoing acknowledgments, representations, warranties
and
agreements and agree that if any of the acknowledgments, representations,
warranties and agreements deemed to have been made by our purchase of any of
the
Offered Securities are no longer accurate, we shall promptly notify the Sponsor.
If we are acquiring any Offered Securities as a fiduciary or agent for one
or
more investor accounts, we represent that we have sole discretion with respect
to each such investor account and that we have full power to make the foregoing
acknowledgments, representations and agreement on behalf of each such investor
account.
Upon
transfer, the Capital Securities (having a stated liquidation amount of
$_____________) would be registered in the name of the new beneficial owner
as
follows.
Name:
Address:
______________________________
Taxpayer
ID Number:
_____________________
EXHIBIT
C
Form
of Transferor Certificate
to
be Executed by QIB/QPs for Non-Global Securities
__________,
[ ]
The
Bank
of New York Trust Company, National Association
601
Travis, 16th Floor
Houston,
Texas 77002
Attention:
Global Corporate Trust - Hallmark Statutory Trust II
Hallmark
Financial Services, Inc.
Hallmark
Statutory Trust II
777
Main
Street, Suite 1000
Fort
Worth, Texas 76102
|
Re:
|
Purchase
of Floating Rate Capital Securities (the “Capital Securities”) of Hallmark
Statutory
Trust
II
|
Reference
is hereby made to the Amended and Restated Declaration of Trust of Hallmark
Statutory Trust II, dated as of August 23, 2007 (the “Declaration”), among Mark
Schwartz and Mark Morrison, as Administrators, The Bank of New York (Delaware),
as Delaware Trustee, The Bank of New York Trust Company, National Association,
as Institutional Trustee, Hallmark Financial Services, Inc., as Sponsor, and
the
holders from time to time of undivided beneficial interests in the assets of
Hallmark Statutory Trust II. Capitalized terms used but not defined herein
shall
have the meanings given them in the Declaration.
This
letter relates to $________________________ aggregate liquidation amount of
Capital Securities which are held in the name of [name of transferor] (the
“Transferor”).
In
accordance with Article VI of the Declaration, the Transferor hereby certifies
that such Capital Securities are being transferred in accordance with (i) the
transfer restrictions set forth in the Capital Securities and (ii) Rule 144A
under the Securities Act (“Rule 144A”), to a transferee that the Transferor
reasonably believes is purchasing the Capital Securities for its own account
or
an account with respect to which the transferee exercises sole investment
discretion and the transferee and any such account is a “qualified institutional
buyer” within the meaning of Rule 144A, who is also a “qualified purchaser”
within the meaning of Section 3(c)(7) of the Investment Company Act or (ii)
a company beneficially owned exclusively by one or more “qualified purchasers”
and/or “knowledgeable employees” with respect to the Sponsor within the meaning
of Rule 3c-5 under the Investment Company Act, in a transaction meeting the
requirements of Rule 144A and in accordance with applicable securities laws
of
any state of the United States or any other jurisdiction.
You
are
entitled to rely upon this letter and are irrevocably authorized to produce
this
letter or a copy hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered
hereby.
EXHIBIT
D
Officer’s
Financial Certificate
The
undersigned, the [Chairman/Vice Chairman/Chief Executive Officer/President/Vice
President/Chief Financial Officer/Treasurer/Assistant Treasurer], hereby
certifies pursuant to Section 10.2(f) of the Amended and Restated
Declaration of Trust, dated as of August 23, 2007 (the “Declaration”), among
Hallmark Financial Services, Inc.
(the
“Sponsor”), The Bank of New York Trust Company, National Association, as
institutional trustee, The Bank of New York (Delaware), as Delaware trustee,
and
the administrators named therein, that, as of [date], [20__], the Sponsor,
if
applicable, and its Subsidiary Insurance Companies (as defined below) had the
following ratios and balances:
[For
the
Sponsor, if applicable, and each Subsidiary Insurance Company (as defined below)
provide:]
[INSURANCE
COMPANY]
As
of
[Quarterly/Annual
Financial Date]
,
20__
NAIC
Risk Based Capital Ratio (authorized control level)
|
_____%
|
|
|
Total
Policyholders’ Surplus
|
$_____
|
|
|
Consolidated
Debt to Total Policyholders’ Surplus
|
_____%
|
|
|
Total
Assets
|
$_____
|
|
|
NAIC
Class 1 & 2 Rated Investments to Total Fixed Income Investments
|
_____%
|
|
|
NAIC
Class 1 & 2 Rated Investments to Total Investments
|
_____%
|
|
|
Return
on Policyholders’ Surplus
|
_____%
|
|
[For
Property & Casualty Companies, also provide:]
|
|
|
[Expense
Ratio
|
_____%
|
|
|
Loss
and LAE Ratio
|
_____%
|
|
|
Combined
Ratio
|
_____%
|
|
|
Net
Premiums Written (annualized) to Policyholders’ Surplus
|
_____%]
|
*
A table
describing the officer’s financial certificate calculation procedures is
provided on page 3
The
following is a complete list as of [Quarterly/Annual Financial Date] of the
Company’s companies which are authorized to write insurance business or
otherwise conduct insurance or reinsurance business (the “Subsidiary Insurance
Companies”):
[List
of
Subsidiary Insurance Companies]
[FOR
FISCAL YEAR END: Attached hereto are the audited consolidated financial
statements (including the balance sheet, income statement and statement of
cash
flows, and notes thereto, together with the report of the independent
accountants thereon) of the Sponsor and its consolidated subsidiaries for the
three years ended _______, 20___] and the Statutory Financial Statements (as
defined in the Declaration) for the year ended [date] 20__.
Pursuant
to Section 4.03(c) of the Indenture and Section 10.2(f) of the
Declaration, each of the undersigned hereby certifies that, to the knowledge
of
the undersigned, neither the Sponsor nor the Trust is default in the performance
or observance of any of the terms, provisions or conditions contained in the
Indenture or the Declaration (without regard to any period of grace or
requirement of notice provided under the Indenture or the Declaration, as the
case may be), for the calendar year ending on ________, 20__ [, except as
follows:
specify
each such default and the nature and status thereof
].
[FOR
FISCAL QUARTER END: Attached hereto are the unaudited consolidated and
consolidating financial statements (including the balance sheet and income
statement) of the Sponsor and its consolidated subsidiaries and the Statutory
Financial Statements (as defined in the Declaration) for the fiscal quarter
ended [date], 20__.]
The
financial statements fairly present in all material respects, in accordance
with
U.S. generally accepted accounting principles (“GAAP”), the financial position
of the Sponsor and its consolidated subsidiaries, and the results of operations
and changes in financial condition as of the date, and for the
[quarter] [annual]
period
ended
[date],
20__,
and such financial statements have been prepared in accordance with GAAP
consistently applied throughout the period involved (expect as otherwise noted
therein).
The
Statutory Financial Statements fairly present in all material respects in
accordance with Applicable Accounting Principles (as defined in the Declaration)
the financial position of the subject insurance company and have been prepared
in accordance with Applicable Accounting Principles consistently applied
throughout the period involved.
IN
WITNESS WHEREOF, the undersigned has executed this Officer’s Financial
Certificate as of this _____ day of _____________, 20__.
|
|
|
|
Hallmark
Financial Services, Inc.
|
|
|
|
|
By:
|
|
|
Name:
|
|
|
|
|
|
Hallmark
Financial Services, Inc.
777
Main Street, Suite 1000
Fort
Worth, Texas 76102
(817)
348-1728
|
Definitions
for Officer’s Financial Certificate
Report
Item
|
|
Description
of Calculation
|
|
|
|
NAIC
Risk Based Capital Ratio-P&C
|
|
Total
Adjusted Capital/Authorized Control Level Risk-Based
Capital
|
|
|
|
NAIC
Risk Based Capital Ratio-Life
|
|
(Total
Adjusted Capital-Asset Valuation Reserve)/Authorized Control Level
Risk-Based Capital
|
|
|
|
Total
Capital and Surplus-Life
|
|
Common
Capital Stock + Preferred Capital Stock + Aggregate Write-Ins for
other
than special surplus funds + Surplus Notes + Gross Paid-In and Contributed
Surplus + Aggregate Write-Ins for Special Surplus Funds + Unassigned
Funds
(Surplus) - Treasury Stock.
|
|
|
|
Total
Capital and Surplus-P&C
|
|
Aggregate
Write-Ins for Special Surplus Funds + Common Capital Stock + Preferred
Capital Stock + Aggregate Write Ins for other than special surplus
funds +
Surplus Notes + Gross Paid-In and Contributed Surplus + Unassigned
Funds
(Surplus) - Treasury Stock
|
|
|
|
Total
Class 1 & 2 Rated Investments to Total Fixed Income
Investments
|
|
(Total
Class 1 + Total Class 2 Rated Investments)/Total Fixed Income
Investments
|
|
|
|
Total
Class 1 & 2 Rated Investments to Total
Investments
|
|
(Total
Class 1 +Total Class 2 Rated Investments)/Total
Investments
|
|
|
|
Total
Assets
|
|
Total
Assets
|
|
|
|
Return
on Policyholders’ Surplus
|
|
Net
Income/Policyholders’ Surplus
|
|
|
|
Expense
Ratio
|
|
Other
Underwriting Expenses Incurred/Net Premiums Written
|
|
|
|
Loss
and LAE Ratio
|
|
(Losses
Incurred + Loss Expenses Incurred)/Net Premiums Earned
|
|
|
|
Combined
Ratio
|
|
Expense
Ratio + Loss and LAE Ratio
|
|
|
|
Net
Premiums Written (annualized) to Policyholders’
Surplus
|
|
Net
Premiums Written/Policyholders’
Surplus
|
EXHIBIT
E
FORM
OF REGULATION S GLOBAL CAPITAL SECURITY
TRANSFEREE
CERTIFICATE
The
Bank
of New York Trust Company, National Association, as Institutional
Trustee
601
Travis Street, 16th Floor
Houston,
TX 77002
Attention:
Global Corporate Trust - Hallmark Statutory Trust II
Re:
|
Capital
Securities of Hallmark Statutory Trust II (the
“Securities”)
|
Reference
is hereby made to the Amended and Restated Declaration of Trust of Hallmark
Statutory Trust II, dated as of August 23, 2007 (the “Declaration”), among Mark
Schwartz and Mark Morrison, as Administrators, The Bank of New York (Delaware),
as Delaware Trustee, The Bank of New York Trust Company, National Association,
as Institutional Trustee and Hallmark Financial Services, Inc., as Sponsor.
Capitalized terms used but not defined herein shall have the meanings given
them
in the Declaration.
This
letter relates to U.S. $_______________ aggregate outstanding principal amount
of the Sponsor’s Capital Securities of Hallmark Statutory Trust II which are
held in the form of an interest in a Rule 144A Global Capital Security with
the
Depository (144A CUSIP NUMBER: [_______], ISIN NUMBER.: [__________]) in the
name of __________________ [name of transferor] (the “Transferor”) to effect the
transfer of the Capital Securities in exchange for an equivalent beneficial
interest in a Regulation S Global Capital Security in the name of
__________________ [name of transferee] (the “Transferee”).
In
connection with such request, and in respect of such Capital Securities, the
Transferee does hereby certify that such Capital Securities are being
transferred (i) in accordance with the transfer restrictions set forth in the
Indenture relating to the Capital Securities and (ii) pursuant to an exemption
from registration under the United States Securities Act of 1933, as amended
(the “Securities Act”), and in accordance with any applicable securities laws of
any state of the United States or any other jurisdiction.
In
addition, the Transferee hereby represents, warrants and covenants for the
benefit of the Sponsor, the Trust and the Trustees that:
1.
the
offer
of the Capital Securities was not made to a Person in the United
States;
2.
at
the
time the buy order was originated, the Transferee was outside the United States
and the transfer constitutes an offshore transaction (within the meaning of
Regulation S);
3.
no
directed selling efforts have been made in contravention of the requirements
of
Rule 903(a) or 904(a) of Regulation S, as applicable;
4.
the
transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act;
5.
Neither
the Transferee nor any account for which it is acting is a U.S. Person nor
a
U.S. Resident (within the meaning of the Investment Company Act);
6.
if
the
sale is made during a restricted period and the provisions of Rule 903(b)(2)
or
(3) or Rule 904(b)(1) of Regulation S are applicable thereto, the Transferee
confirms that such sale has been made in accordance with the applicable
provisions of Rule 903(b)(2) or (3) or Rule 904(b)(1), as the case may be;
and
7.
for
the
duration that it holds any interest in such Capital Security, either (i) it
is
not acquiring such Capital Security with the assets of a Plan or another
employee benefit plan subject to applicable law that is substantially similar
to
Section 406 of ERISA or Section 4975 of the Code or (ii) the
acquisition, holding or disposition of such Capital Security by the Transferee,
throughout the period that it holds such Capital Security, will not result
in a
nonexempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code (or, in the case of another employee benefit plan,
any substantially similar applicable law), because the purchase, holding and
disposition of such Capital Security is and will be eligible for relief under
a
prohibited transaction exemption, all of the conditions of which are and will
be
satisfied upon its acquisition of, and throughout the term that it holds, such
Capital Security. The Transferee represents, warrants and covenants that it
will
not sell, pledge or otherwise transfer such Capital Security in violation of
the
foregoing.
In
addition, the Transferee hereby represents, warrants and agrees with the
Sponsor, the Trust and the Trustees as to the provisions set forth in Article
VI
of the Declaration.
The
Transferee understands that the Sponsor, the Trust, the Trustees and their
respective counsel will rely upon the accuracy and truth of the foregoing
representations, and the Transferee hereby consents to such reliance. Further,
the Transferee irrevocably authorizes the Sponsor, the Trust, the Trustees
and
their respective counsel to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Taxpayer
Identification Number:
Address
for Notices:
Wire
Instructions for Payments:
Bank:
|
|
|
Address:
|
|
|
Bank
ABA#:
|
|
|
Account
No.:
|
|
Tel:
|
|
|
|
FAO
|
|
Fax:
|
|
|
|
Attn:
|
|
Attn:
|
Registered
Name (if Nominee):
EXHIBIT
F
FORM
OF RULE 144A GLOBAL CAPITAL SECURITY TRANSFEREE
CERTIFICATE
The
Bank
of New York Trust Company, National Association, as Institutional
Trustee
601
Travis Street, 16th Floor
Houston,
TX 77002
Attention:
Global Corporate Trust - Hallmark Financial Services, Inc.
Re:
|
Capital
Securities of Hallmark Statutory Trust II (the
“Securities”)
|
Reference
is hereby made to the Amended and Restated Declaration of Trust of Hallmark
Statutory Trust II, dated as of August 23, 2007 (the “Declaration”), among Mark
Schwartz and Mark Morrison, as Administrators, The Bank of New York (Delaware),
as Delaware Trustee, The Bank of New York Trust Company, National Association,
as Institutional Trustee and Hallmark Financial Services, Inc., as Sponsor.
Capitalized terms used but not defined herein shall have the meanings given
them
in the Declaration.
This
letter relates to U.S. $_______________ aggregate outstanding principal amount
of the Sponsor’s Capital Securities of Hallmark Statutory Trust II which are
held in the form of an interest in a Regulation S Global Capital Security
deposited with the Depository (REG S CUSIP NUMBER: [__________] ISIN NUMBER.:
[__________]) in the name of __________________ [name of transferor] (the
“Transferor”) and a request by the Transferor to effect the transfer of the
Capital Securities in exchange for an equivalent beneficial interest in a Rule
144A Global Capital Security in the name of __________________ [name of
transferee] (the “Transferee”).
In
connection with such request, and in respect of such Capital Securities, the
Transferee does hereby certify that such Securities are being transferred in
accordance with (i) the applicable transfer restrictions set forth in the
Declaration relating to the Capital Securities and (ii) Rule 144A under the
United States Securities Act of 1933, as amended, and any applicable securities
laws of any state of the United States and any other relevant jurisdiction,
and
that the Transferee is purchasing the Capital Securities for its own account
or
one or more accounts with respect to which the Transferee exercises sole
investment discretion, and the Transferee and any such account (A) are both
Qualified Institutional Buyers within the meaning of Rule 144A and Qualified
Purchasers as defined in the Indenture, (B) is not a dealer of the type
described in paragraph (a)(1)(ii) of Rule 144A unless it owns and invests on
a
discretionary basis not less than $25,000,000 in securities of issuers that
are
not affiliated to it, (C) is not a participant-directed employee plan, such
as a
401(k) plan, or any other type of plan referred to in paragraph (a)(1)(i)(D)
or
(a)(1)(i)(E) of Rule 144A, or a trust fund referred to in paragraph (a)(1)(i)(F)
of Rule 144A that holds the assets of such a plan, unless investment decisions
with respect to the plan are made solely by the fiduciary, trustee or sponsor
of
such plan, and (D) was not formed for the purpose of investing in the Trust
(unless each of its beneficial owners is a Qualified Purchaser).
The
Transferee hereby represents, warrants and agrees with the Trust as to the
provisions set forth in Article VI of the Declaration.
Further,
the Transferee hereby certifies, represents and warrants that, for the duration
that it holds any interest in such Capital Securities, either (i) it is not
acquiring such Capital Securities with the assets of a Plan or another employee
benefit plan subject to applicable law that is substantially similar to
Section 406 of ERISA or Section 4975 of the Code or (ii) the
acquisition, holding and disposition of such Capital Securities by the
Transferee, throughout the period that it holds such Capital Securities, will
not result in a nonexempt prohibited transaction under Section 406 of ERISA
or Section 4975 of the Code (or, in the case of another employee benefit
plan, any substantially similar applicable law), because the purchase, holding
and disposition of such Capital Securities is and will be eligible for relief
under a prohibited transaction exemption, all of the conditions of which are
and
will be satisfied upon its acquisition of, and throughout the term that it
holds, such Capital Securities. The Transferee represents, warrants and
covenants that it will not sell, pledge or otherwise transfer such Capital
Securities in violation of the foregoing.
The
Transferee understands that the Sponsor, the Trust, the Trustees and their
respective counsels will rely upon the accuracy and truth of the foregoing
representations, and the Transferee hereby consents to such reliance. Further,
the Transferee irrevocably authorizes the Sponsor, the Trust, the Trustees
and
their respective counsel to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Taxpayer
Identification Number:
Address
for Notices:
Wire
Instructions for Payments:
Bank:
|
|
|
Address:
|
|
|
Bank
ABA#:
|
|
|
Account
No.:
|
|
Tel:
|
|
|
|
FAO:
|
|
Fax:
|
|
|
|
Attn:
|
|
Attn:
|
Registered
Name (if Nominee):
The
Transferor agrees to the foregoing and certifies that it reasonably believes
that such Transferee and its accounts, if any, are both Qualified Institutional
Buyers within the meaning of such Rule 144A and Qualified Purchasers as defined
in the Declaration.