CAPITAL SECURITIES GUARANTEE AGREEMENT
GREAT WESTERN FINANCIAL TRUST II
Dated as of January 22, 1997
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS AND INTERPRETATION. . . . . . . . 2
Section 1.1. Definitions and Interpretation.. . . . . . . . 2
ARTICLE II
TRUST INDENTURE ACT . . . . . . . . . . 5
Section 2.1. Trust Indenture Act; Application.. . . . . . . 5
Section 2.2. Lists of Holders of Trust Securities.. . . . . 5
Section 2.3. Reports by the Capital Guarantee Trustee.. . . 6
Section 2.4. Periodic Reports to Capital Guarantee Trustee. 6
Section 2.5. Evidence of Compliance with Conditions
Precedent. . . . . . . . . . . . . . . . . . . 6
Section 2.6. Events of Default; Waiver. . . . . . . . . . . 6
Section 2.7. Event of Default; Notice.. . . . . . . . . . . 7
Section 2.8. Conflicting Interests. . . . . . . . . . . . . 7
ARTICLE III
POWER, DUTIES AND RIGHTS OF
CAPITAL GUARANTEE TRUSTEE. . . . . . . . . 7
Section 3.1. Powers and Duties of the Capital Guarantee
Trustee. . . . . . . . . . . . . . . . . . . . 7
Section 3.2. Certain Rights of Capital Guarantee Trustee. . 9
Section 3.3. Not Responsible for Recitals or Issuance of
Guarantee. . . . . . . . . . . . . . . . . . . 12
ARTICLE IV
CAPITAL GUARANTEE TRUSTEE. . . . . . . . . 12
Section 4.1. Capital Guarantee Trustee; Eligibility.. . . . 12
Section 4.2. Appointment Removal and Resignation of Capital
Guarantee Trustees.. . . . . . . . . . . . . . 13
ARTICLE V
GUARANTEE. . . . . . . . . . . . . 13
Section 5.1. Guarantee. . . . . . . . . . . . . . . . . . . 13
Section 5.2. Subordination. . . . . . . . . . . . . . . . . 14
Section 5.3. Waiver of Notice and Demand. . . . . . . . . . 14
Section 5.4. Obligations Not Affected.. . . . . . . . . . . 14
Section 5.5. Rights of Holders. . . . . . . . . . . . . . . 15
Section 5.6. Guarantee of Payment.. . . . . . . . . . . . . 15
Section 5.7. Subrogation. . . . . . . . . . . . . . . . . . 15
Section 5.8. Independent Obligations. . . . . . . . . . . . 16
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION. . . . . 16
Section 6.1. Limitation of Transactions.. . . . . . . . . . 16
Section 6.2. Ranking. . . . . . . . . . . . . . . . . . . . 16
ARTICLE VII
TERMINATION . . . . . . . . . . . . 17
Section 7.1. Termination. . . . . . . . . . . . . . . . . . 17
ARTICLE VIII
INDEMNIFICATION . . . . . . . . . . . 17
Section 8.1. Exculpation. . . . . . . . . . . . . . . . . . 17
Section 8.2. Indemnification. . . . . . . . . . . . . . . . 18
ARTICLE IX
MISCELLANEOUS. . . . . . . . . . . . 18
Section 9.1. Successors and Assigns.. . . . . . . . . . . . 18
Section 9.2. Amendments.. . . . . . . . . . . . . . . . . . 18
Section 9.3. Notices. . . . . . . . . . . . . . . . . . . . 19
Section 9.4. Benefit. . . . . . . . . . . . . . . . . . . . 19
Section 9.5. Governing Law. . . . . . . . . . . . . . . . . 19
CAPITAL SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT ("Guarantee Agreement"), dated
as of January 22, 1997, is executed and delivered by Great Western
Financial Corporation, a Delaware corporation (the "Guarantor"),
and The First National Bank of Chicago, as trustee (the "Capital
Guarantee Trustee"), for the benefit of the Holders (as defined
herein) from time to time of the Capital Securities (as defined
herein) of Great Western Financial Trust II, a Delaware statutory
business trust (the "Issuer").
RECITALS
WHEREAS, pursuant to an Amended and Restated Declaration
of Trust (the "Declaration"), dated as of January 22, 1997, among
the trustees of the Issuer named therein, the Guarantor, as
sponsor, and the holders from time to time of undivided beneficial
interests in the assets of the Issuer, the Issuer is issuing on the
date hereof $300 million aggregate stated liquidation amount of
Capital Securities designated the 8.206% Capital Securities, Series
A (the "Capital Securities");
WHEREAS, as incentive for the Holders (as hereinafter
defined) to purchase the Capital Securities, the Guarantor desires
irrevocably and unconditionally to agree, to the extent set forth
in this Guarantee Agreement, to pay to the Holders of the Capital
Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth
herein; and
WHEREAS, the Guarantor is also executing and delivering a
guarantee agreement (the "Common Securities Guarantee Agreement")
with substantially identical terms to this Guarantee Agreement for
the benefit of the holders of the Common Securities (as defined
herein) except that if an Event of Default (as defined in the
Indenture (as defined herein)), has occurred and is continuing, the
rights of holders of the Common Securities to receive Guarantee
Payments under the Common Securities Guarantee Agreement are
subordinated to the rights of Holders of Capital Securities to
receive Guarantee Payments under this Guarantee Agreement.
NOW, THEREFORE, in consideration of the purchase by each
Holder of Capital Securities, which purchase the Guarantor hereby
agrees shall benefit the Guarantor, the Guarantor executes and
delivers this Guarantee Agreement for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1. Definitions and Interpretation.
In this Guarantee Agreement, unless the context otherwise
requires:
(a) capitalized terms used in this Guarantee Agreement but
not defined in the preamble above have the respective
meanings assigned to them in this Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "this
Guarantee Agreement" are to this Guarantee Agreement as
modified, supplemented or amended from time to time;
(d) all references in this Guarantee Agreement to Articles
and Sections are to Articles and Sections of this
Guarantee Agreement unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee Agreement unless
otherwise defined in this Guarantee Agreement or unless
the context otherwise requires; and
(f) a reference to the singular includes the plural and vice
versa.
"Affiliate" has the same meaning as given to that term in
Rule 405 of the Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means any Person that is
authorized to bind such Person.
"Capital Guarantee Trustee" means The First National Bank
of Chicago until a Successor Capital Guarantee Trustee has been
appointed and has accepted such appointment pursuant to the terms
of this Guarantee Agreement and thereafter means each such
Successor Capital Guarantee Trustee.
"Common Securities" means the common securities
representing undivided beneficial interests in the assets of
the Issuer.
"Covered Person" means any Holder or beneficial owner of
Capital Securities.
"Direction" by a Person means a written direction signed:
(a) if the Person is a natural person by that Person; or
(b) in any other case, in the name of such Person by one
or more Authorized Officers of that Person.
"Event of Default" means a default by the Guarantor on
any of its payment or other obligations under this Guarantee
Agreement.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Capital
Securities, to the extent not paid or made by the Issuer: (i) any
accrued and unpaid Distributions (as defined in the Declaration)
that are required to be paid on such Capital Securities to the
extent the Issuer shall have received a payment of interest or
principal on the Notes therefor, (ii) the redemption price,
including all accrued and unpaid Distributions to the date of
redemption (the "Redemption Price") to the extent the Issuer has
received a payment of interest or principal or premium, if any, on
the Notes with respect to any Capital Securities called for
redemption by the Issuer, and (iii) upon a voluntary or involuntary
liquidation, dissolution, winding-up or termination of the Issuer
(other than in connection with the distribution of Notes to the
Holders in exchange for Capital Securities as provided in the
Declaration or the redemption of all of the Capital Securities upon
the maturity or redemption of the Notes), the lesser of (a) the
aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Capital Securities to the date of payment to
the extent the Issuer has received a payment on the Notes therefor,
and (b) the amount of assets of the Issuer remaining available for
distribution to Holders in liquidation of the Issuer (in either
case, the "Liquidation Distribution").
"Holder" shall mean any holder, as registered on the
books and records of the Issuer of any Capital Securities;
provided, that, in determining whether the holders of the requisite
percentage of Capital Securities have given any request, notice,
consent or waiver hereunder, "Holder" shall not include the
Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Capital Guarantee Trustee,
any Affiliate of the Capital Guarantee Trustee, or any officers,
directors, shareholders, members, partners, employees,
representatives or agents of the Capital Guarantee Trustee.
"Indenture" means the Indenture dated as of September 12,
1990, as amended and supplemented by a First Supplemental
Indenture, dated as of April 30, 1993, the Second Supplemental
Indenture; dated as of December 6, 1995 and the Third Supplemental
Indenture, dated as of January 22, 1997, among the Note Issuer and
▇▇▇▇▇▇ Trust and Savings Bank, as trustee, and any indenture
supplemental thereto pursuant to which certain Notes are to be
issued.
"Majority in liquidation amount of the Trust Securities"
means, except as provided by the Trust Indenture Act, a vote by
Holder(s) of Capital Securities, voting separately as a class, of
more than 50% of the 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 Capital Securities.
"Note Issuer" means the Guarantor in its capacity as
issuer of the Notes.
"Notes" means the subordinated debt securities of the
Note Issuer issued pursuant to the Indenture and acquired by the
Issuer.
"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
Guarantee Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the
definition 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.
"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.
"Responsible Officer" means, with respect to the Capital
Guarantee Trustee, any vice-president, any assistant vice-
president, the secretary, any assistant secretary, the treasurer,
any assistant treasurer, any trust officer or assistant trust
officer or any other officer 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.
"Securities Act" means the Securities Act of 1933,
as amended from time to time, or any successor legislation.
"Successor Capital Guarantee Trustee" means a successor
Capital Guarantee Trustee possessing the qualifications to act as
Capital Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act
of 1939, in effect at the date as of which this instrument
was executed; provided, however, that in the event the Trust
Indenture Act of 1939 is amended after such date, "Trust Indenture
Act" means to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trust Securities" means collectively the Common
Securities and the Capital Securities.
ARTICLE II
TRUST INDENTURE ACT
Section 2.1. Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the provisions of
the Trust Indenture Act that are required to be part of
this Guarantee Agreement and shall, to the extent
applicable, be governed by such provisions; and
(b) if and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties
imposed by Section 310 to 317, inclusive, of the Trust
Indenture Act, such duties imposed by the Trust Indenture
Act shall control.
Section 2.2. Lists of Holders of Trust Securities.
(a) The Guarantor shall provide the Capital Guarantee Trustee
with a list, in such form as the Capital Guarantee
Trustee may reasonably require, of the names and
addresses of the Holders of the Capital Securities ("List
of Holders") as of such date, (i) within 14 days after
each record date for payment of distributions on the
Capital Securities, and (ii) at any other time within 30
days of receipt by the Guarantor of a written request for
a List of Holders as of a date no more than 14 days
before such List of Holders is given to the Capital
Guarantee Trustee provided that the Guarantor shall not
be obligated to provide such List of Holders at any time
the List of Holders does not differ from the most recent
List of Holders given to the Capital Guarantee Trustee by
the Guarantor. The Capital Guarantee Trustee may destroy
any List of Holders previously given to it on receipt of
a new List of Holders.
(b) The Capital Guarantee Trustee shall comply with its
obligations under Section 311(a), 311(b) and Section
312(b) of the Trust Indenture Act.
Section 2.3. Reports by the Capital Guarantee Trustee.
Within 60 days after May 15 of each year, the Capital
Guarantee Trustee shall provide to the Holders of the Capital
Securities such reports as are required by Section 313 of the Trust
Indenture Act, if any, in the form and in the manner provided by
Section 313 of the Trust Indenture Act. The Capital Guarantee
Trustee shall also comply with the requirements of Section 313(d)
of the Trust Indenture Act.
Section 2.4. Periodic Reports to Capital Guarantee Trustee.
The Guarantor shall provide to the Capital Guarantee
Trustee such documents, reports and information as required by
Section 314 (if any) and the compliance certificate required by
Section 314 of the Trust Indenture Act in the form, in the manner
and at the times required by Section 314 of the Trust Indenture
Act.
Section 2.5. Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Capital Guarantee
Trustee such evidence of compliance with any conditions precedent,
if any, provided for in this Guarantee Agreement that relate to any
of the matters set forth in Section 314(c) of the Trust Indenture
Act. Any certificate or opinion required to be given by an officer
pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
Section 2.6. Events of Default; Waiver.
The Holders of a Majority in liquidation amount of
Capital Securities may, by vote, on behalf of the Holders of all of
the Capital Securities, waive any past Event of Default and its
consequences. Upon such waiver, any such Event of Default shall
cease to exist, and any Event of Default arising therefrom shall be
deemed to have been cured, for every purpose of this Guarantee
Agreement, but no such waiver shall extend to any subsequent or
other default or Event of Default or impair any right consequent
thereon.
Section 2.7. Event of Default; Notice.
(a) The Capital Guarantee Trustee shall, within 90 days after
the occurrence of an Event of Default known to the Capital
Guarantee Trustee, transmit by mail, first class postage prepaid,
to the Holders of the Capital Securities, notices of such Events of
Default, unless such defaults have been cured before the giving of
such notice, provided, that, the Capital Guarantee Trustee shall be
protected in withholding such notice if and so long as the board of
directors, the executive committee, or a trust committee of
directors and/or Responsible Officers of the Capital Guarantee
Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders of the Capital
Securities.
(b) The Capital Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the Capital Guarantee
Trustee shall have received written notice, or a Responsible
Officer shall have obtained written notice, of such Event
of Default.
Section 2.8. Conflicting Interests.
The Declaration shall be deemed to be specifically
described in this Guarantee Agreement for the purposes of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWER, DUTIES AND RIGHTS OF
CAPITAL GUARANTEE TRUSTEE
Section 3.1. Powers and Duties of the Capital Guarantee Trustee.
(a) This Guarantee Agreement shall be held by the Capital
Guarantee Trustee for the benefit of the Holders of
the Capital Securities, and the Capital Guarantee Trustee
shall not transfer this Guarantee Agreement to any Person
except a Holder of Capital Securities exercising his or
her rights pursuant to Section 5.4(b) or to a Successor
Capital Guarantee Trustee on acceptance by such Successor
Capital Guarantee Trustee of its appointment to act as
Successor Capital Guarantee Trustee. The right, title
and interest of the Capital Guarantee Trustee shall
automatically vest in any Successor Capital Guarantee
Trustee, and such vesting and cessation of title shall be
effective whether or not conveyancing documents have been
executed and delivered pursuant to the appointment of
such Successor Capital Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing,
the Capital Guarantee Trustee shall enforce this
Guarantee Agreement for the benefit of the Holders of the
Capital Securities.
(c) The Capital Guarantee Trustee, before the occurrence of
any Event of Default and after the curing of all Events
of Default that may have occurred, shall undertake to
perform only such duties as are specifically set forth in
this Guarantee Agreement, and no implied covenants shall
be read into this Guarantee Agreement against the Capital
Guarantee Trustee. In case an Event of Default has
occurred (that has not been cured or waived pursuant to
Section 2.6), the Capital Guarantee Trustee shall
exercise such of the rights and powers vested in it by
this Guarantee Agreement, and use the same degree of care
and skill in its exercise thereof, as a prudent person
would exercise or use under the circumstances in the
conduct of his or her own affairs.
(d) No provision of this Guarantee Agreement shall be
construed to relieve the Capital Guarantee Trustee from
liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except
that:
(i) prior to the occurrence of any Event of Default and
after the curing or waiving of all such Events of
Default that may have occurred:
(A) the duties and obligations of the Capital
Guarantee Trustee shall be determined solely
by the express provisions of this Guarantee
Agreement, and the Capital Guarantee Trustee
shall not be liable except for the performance
of such duties and obligations as are
specifically set forth in this Guarantee
Agreement, and no implied covenants or
obligations shall be read into this Guarantee
Agreement against the Capital Guarantee
Trustee; and
(B) in the absence of bad faith on the part of the
Capital Guarantee Trustee, the Capital
Guarantee Trustee may conclusively rely, as to
the truth of the statements and the
correctness of the opinions expressed therein,
upon any certificates or opinions furnished to
the Capital Guarantee Trustee and conforming
to the requirements of this Guarantee
Agreement; but in the case of any such
certificates or opinions that by any provision
hereof are specifically required to be
furnished to the Capital Guarantee Trustee,
the Capital Guarantee Trustee shall be under a
duty to examine the same to determine whether
or not they conform to the requirements of
this Guarantee Agreement;
(ii) the Capital Guarantee Trustee shall not be liable
for any error of judgment made in good faith by a
Responsible Officer of the Capital Guarantee
Trustee, unless it shall be proved that the Capital
Guarantee Trustee was negligent in ascertaining the
pertinent facts upon which such judgment was made;
(iii) the Capital Guarantee Trustee shall not be liable
with respect to any action taken or omitted to be
taken by it in good faith in accordance with the
direction of the Holders of not less than a
Majority in liquidation amount of the Capital
Securities relating to the time, method and place
of conducting any proceeding for any remedy
available to the Capital Guarantee Trustee, or
exercising any trust or power conferred upon the
Capital Guarantee Trustee under this Guarantee
Agreement; and
(iv) no provision of this Guarantee Agreement shall
require the Capital Guarantee Trustee to expend or
risk its own funds or otherwise incur personal
financial liability in the performance of any of
its duties or in the exercise of any of its rights
or powers, if the Capital Guarantee Trustee shall
have reasonable grounds for believing that the
repayment of such funds or liability is not
reasonably assured to it under the terms of this
Guarantee Agreement or adequate indemnity against
such risk or liability is not reasonably assured to
it.
Section 3.2. Certain Rights of Capital Guarantee Trustee.
(a) Subject to the provisions of Section 3.1:
(i) The Capital Guarantee Trustee may rely and shall be
fully protected in acting or refraining from acting
upon any resolution, certificate, statement,
instrument, opinion, report, notice, request,
direction, consent, order, 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.
(ii) Any direction or act of the Guarantor contemplated
by this Guarantee Agreement shall be sufficiently
evidenced by a Direction or an Officers'
Certificate.
(iii) Whenever, in the administration of this Guarantee
Agreement, the Capital Guarantee Trustee shall deem
it desirable that a matter be proved or established
before taking, suffering or omitting any action
hereunder, the Capital Guarantee Trustee (unless
other evidence is herein specifically prescribed)
may, in the absence of bad faith on its part,
request and rely upon an Officers' Certificate
which, upon receipt of such request, shall be
promptly delivered by the Guarantor.
(iv) The Capital Guarantee Trustee shall have no duty to
see to any recording, filing or registration of any
instrument (or any rerecording, refiling or
registration thereof).
(v) The Capital Guarantee Trustee may consult with
counsel, and the written advice or opinion of such
counsel with respect to legal matters shall be full
and complete authorization and protection in
respect of any action taken, suffered or omitted by
it hereunder in good faith and in accordance with
such advice or opinion. Such counsel may be
counsel to the Guarantor or any of its Affiliates
and may include any of its employees. The Capital
Guarantee Trustee shall have the right at any time
to seek instructions concerning the administration
of this Guarantee Agreement from any court of
competent jurisdiction.
(vi) The Capital Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers
vested in it by this Guarantee Agreement at the
request or direction of any Holder, unless such
Holder shall have provided to the Capital Guarantee
Trustee such adequate security and indemnity as
would satisfy a reasonable person in the position
of the Capital Guarantee Trustee, against the
costs, expenses (including attorneys' fees and
expenses) and liabilities that might be incurred by
it in complying with such request or direction,
including such reasonable advances as may be
requested by the Capital Guarantee Trustee;
provided that, nothing contained in this Section
3.2(a)(vi) shall be taken to relieve the Capital
Guarantee Trustee, upon the occurrence of an Event
of Default, of its obligation to exercise the
rights and powers vested in it by this Guarantee
Agreement.
(vii) The Capital Guarantee Trustee shall not be bound to
make any investigation into the facts or matters
stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or
document, but the Capital Guarantee Trustee, in its
discretion may make such further inquiry or
investigation into such facts or matters as it may
see fit.
(viii) The Capital Guarantee Trustee may execute any
of the trusts or powers hereunder or perform any
duties hereunder either directly or by or through
agents or attorneys, and the Capital Guarantee
Trustee shall not be responsible for any misconduct
or negligence on the part of any agent or attorney
appointed with due care by it hereunder.
(ix) Any action taken by the Capital Guarantee Trustee
or its agents hereunder shall bind the Holders of
the Capital Securities, and the signature of the
Capital Guarantee Trustee or its agents alone shall
be sufficient and effective to perform any such
action. No third party shall be required to
inquire as to the authority of the Capital
Guarantee Trustee to so act or as to its compliance
with any of the terms and provisions of this
Guarantee Agreement, both of which shall be
conclusively evidenced by the Capital Guarantee
Trustee's or its agent's taking such action.
(x) Whenever in the administration of this Guarantee
Agreement the Capital Guarantee Trustee shall deem
it desirable to receive instructions with respect
to enforcing any remedy or right or taking any
other action hereunder, the Capital Guarantee
Trustee (i) may request instructions from the
Holders of the Capital Securities, (ii) may refrain
from enforcing such remedy or right or taking such
other action until such instructions are received,
and (iii) shall be protected in acting in
accordance with such instructions.
(b) No provision of this Guarantee Agreement shall be deemed
to impose any duty or obligation on the Capital Guarantee
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 Capital Guarantee 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 Capital Guarantee Trustee
shall be construed to be a duty.
Section 3.3. Not Responsible for Recitals or Issuance of
Guarantee.
The recitals contained in this Guarantee shall be taken
as the statements of the Guarantor, and the Capital Guarantee
Trustee does not assume any responsibility for their correctness.
The Capital Guarantee Trustee makes no representation as to the
validity or sufficiency of this Guarantee Agreement.
ARTICLE IV
CAPITAL GUARANTEE TRUSTEE
Section 4.1. Capital Guarantee Trustee; Eligibility.
(a) There shall at all times be a Capital Guarantee Trustee
which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under
the laws of the United States of America or any
State or Territory thereof or of the District of
Columbia, or a corporation or Person permitted by
the Securities and Exchange Commission to act as an
institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise
corporate trust powers, having a combined capital
and surplus of at least 50 million U.S. dollars
($50,000,000), and subject to supervision or
examination by Federal, State, Territorial or
District of Columbia authority. If such
corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of
the supervising or examining authority referred to
above, then, for the purposes of this Section
4.1(a)(ii), the combined capital and surplus of
such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent
report of condition so published.
(b) If at any time the Capital Guarantee Trustee shall cease
to be eligible to so act under Section 4.1(a), the
Capital Guarantee Trustee shall immediately resign in the
manner and with the effect set out in Section 4.2(c).
(c) If the Capital Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section
310(b) of the Trust Indenture Act, the Capital Guarantee
Trustee and Guarantor shall in all respects comply with
the provisions of Section 310(b) of the Trust Indenture
Act.
Section 4.2. Appointment Removal and Resignation of Capital
Guarantee Trustees.
(a) Subject to Section 4.2(b), the Capital Guarantee Trustee
may be appointed or removed without cause at any time by
the Guarantor.
(b) The Capital Guarantee Trustee shall not be removed
in accordance with Section 4.2(a) until a Successor
Capital Guarantee Trustee has been appointed and
has accepted such appointment by written instrument
executed by such Successor Capital Guarantee Trustee and
delivered to the Guarantor.
(c) The Capital Guarantee Trustee appointed to office shall
hold office until a Successor Capital Guarantee Trustee
shall have been appointed or until its removal or
resignation. The Capital Guarantee Trustee may resign
from office (without need for prior or subsequent
accounting) by an instrument in writing executed by the
Capital Guarantee Trustee and delivered to the Guarantor,
which resignation shall not take effect until a Successor
Capital Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing
executed by such Successor Capital Guarantee Trustee and
delivered to the Guarantor and the resigning Capital
Guarantee Trustee.
(d) If no Successor Capital Guarantee Trustee shall have been
appointed and accepted appointment as provided in this
Section 4.2 within 60 days after delivery to the
Guarantor of an instrument of resignation, the resigning
Capital Guarantee Trustee may petition any court of
competent jurisdiction for appointment of a Successor
Capital Guarantee Trustee. Such court may thereupon,
after prescribing such notice, if any, as it may deem
proper, appoint a Successor Capital Guarantee Trustee.
ARTICLE V
GUARANTEE
Section 5.1. Guarantee.
The Guarantor irrevocably and unconditionally agrees
to pay in full to the Holders the Guarantee Payments (without
duplication of amounts theretofore paid by the Issuer), as and when
due, regardless of any defense, right of set-off or counterclaim
that the Issuer may have or assert. The Guarantor's obligation to
make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Guarantor to the Holders or by causing the
Issuer to pay such amounts to the Holders.
Section 5.2. Subordination.
If an Event of Default under the Indenture has occurred
and is continuing, the rights of holders of the Common Securities
to receive payments under the Common Securities Guarantee Agreement
are subordinated to the rights of Holders of Capital Securities to
receive Guarantee Payments.
Section 5.3. Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of this
Guarantee Agreement and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a
proceeding first against the Issuer or any other Person before
proceeding against the Guarantor, protest, notice of nonpayment,
notice of dishonor, notice of redemption and all other notices and
demands.
Section 5.4. Obligations Not Affected.
The obligations, covenants, agreements and duties of the
Guarantor under this Guarantee Agreement shall in no way be
affected or impaired by reason of the happening from time to time
of any of the following:
(a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the Issuer of any
express or implied agreement, covenant, term or condition
relating to the Capital Securities to be performed or
observed by the Issuer;
(b) the extension of time for the payment by the Issuer of
all or any portion of the Distributions, Redemption
Price, Liquidation Distribution or any other sums payable
under the terms of the Capital Securities or the
extension of time for the performance of any other
obligation under, arising out of, or in connection with,
the Capital Securities (other than an extension of time
for payment of Distributions, Redemption Price,
Liquidation Distribution or other sums payable that
results from the extension of any interest payment period
on the Notes or any extension of the maturity date of the
Notes permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any
right, privilege, power or remedy conferred on
the Holders pursuant to the terms of the Capital
Securities, or any action on the part of the Issuer
granting indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment
of debt of, or other similar proceedings affecting, the
Issuer or any of the assets of the Issuer;
(e) invalidity of, or defect or deficiency in the Capital
Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of
a guarantor, it being the intent of this Section 5.3 that
the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all
circumstances.
There shall be no obligation of the Holders to give
notice to, or obtain consent of, the Guarantor with respect to the
happening of any of the foregoing.
Section 5.5. Rights of Holders.
(a) The Holders of a Majority in liquidation amount of the
Capital Securities have the right to direct the time,
method and place of conducting of any proceeding for any
remedy available to the Capital Guarantee Trustee in
respect of this Guarantee Agreement or to direct the
exercise of any trust or power conferred upon the Capital
Guarantee Trustee under this Guarantee Agreement and the
Capital Guarantee Trustee shall be protected in acting in
accordance with such directions.
(b) Any Holder of Capital Securities may institute a legal
proceeding directly against the Guarantor to enforce its
rights under this Guarantee Agreement, without first
instituting a legal proceeding against the Issuer, the
Capital Guarantee Trustee or any other Person.
Section 5.6. Guarantee of Payment.
This Guarantee Agreement creates a guarantee of payment
and not of collection.
Section 5.7. Subrogation.
The Guarantor shall be subrogated to all (if any) rights
of the Holders of Capital Securities against the Issuer in respect
of any amounts paid to such Holders by the Guarantor under this
Guarantee Agreement; provided, however, that the Guarantor shall
not (except to the extent required by mandatory provisions of law)
be entitled to enforce or exercise any right that it may acquire by
way of subrogation or any indemnity reimbursement or other
agreement, in all cases as a result of payment under this Guarantee
Agreement, if, at the time of any such payment, any amounts are due
and unpaid under this Guarantee Agreement. If any amount shall be
paid to the Guarantor in violation of the preceding sentence, the
Guarantor agrees to hold such amount in trust for the Holders and
to pay over such amount to the Holders.
Section 5.8. Independent Obligations.
The Guarantor acknowledges that its obligations hereunder
are independent of the obligations of the Issuer with respect to
the Capital Securities, and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments
pursuant to the terms of this Guarantee Agreement notwithstanding
the occurrence of any event referred to in subsections (a) through
(g), inclusive, of Section 5.4 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
Section 6.1. Limitation of Transactions.
So long as any Capital Securities remain outstanding, if
there shall have occurred an Event of Default or an event of
default under the Declaration, then (a) the Guarantor shall not,
and shall cause any subsidiary of Guarantor that is not a wholly
owned subsidiary of Guarantor not to, declare or pay any dividend
on, or make any distribution with respect to, or redeem, purchase
or acquire or make a liquidation payment with respect to, any of
its capital stock or the capital stock of any such subsidiary and
(b) the Guarantor shall not make any payment of interest, principal
or premium, if any, on or repay, repurchase or redeem any debt
securities (including guarantees) issued by the Guarantor which
rank pari passu with or junior to the Notes, provided, that, the
foregoing restriction in this Section 6.1(a) shall not apply to any
stock dividends paid by Guarantor, or any of its subsidiaries,
where the dividend stock is the same stock as that on which the
dividend is being paid.
Section 6.2. Ranking.
This Guarantee Agreement will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and
junior in right of payment to all other liabilities of the
Guarantor (other than the Common Securities Guarantee or any
guarantee now or hereafter entered into by the Guarantor in respect
of any preferred or preference stock of any Affiliate of the
Guarantor), (ii) pari passu with the most senior preferred or
preference stock now or hereafter issued by the Guarantor and with
any guarantee now or hereafter entered into by the Guarantor in
respect of any preferred or preference stock of any Affiliate of
the Guarantor, and (iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
Section 7.1. Termination.
This Guarantee Agreement shall terminate and the
Guarantee will no longer be deemed to be outstanding upon (i) full
payment of the Redemption Price of all Capital Securities,
(ii) upon the distribution of the Notes to the Holders of all
Capital Securities or (iii) upon full payment of the amounts
payable in accordance with the Declaration upon liquidation of the
Issuer. Notwithstanding the foregoing, this Guarantee Agreement
will continue to be effective or will be reinstated, as the case
may be, if at any time any Holder of Capital Securities must
restore payment of any sums paid under the Capital Securities or
under this Capital Securities Guarantee.
ARTICLE VIII
INDEMNIFICATION
Section 8.1. Exculpation.
(a) No Indemnified Person shall be liable, responsible
or accountable in damages or otherwise to the Guarantor 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 in accordance with this Guarantee Agreement and in a
manner that such Indemnified Person reasonably believed to be
within the scope of the authority conferred on such Indemnified
Person by this Guarantee Agreement or by law, except that an
Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's negligence or
willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying
in good faith upon the records of the Guarantor and upon such
information, opinions, reports or statements presented to the
Guarantor by any Person as to matters the Indemnified Person
reasonably believes are within such other Person's professional or
expert competence and who has been selected with reasonable care by
or on behalf of the Guarantor, 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 Capital Securities might properly be paid.
Section 8.2. Indemnification.
(a) To the fullest extent permitted by applicable law,
the Guarantor shall indemnify and hold harmless each Indemnified
Person from and against any loss, damage or claim incurred by such
Indemnified Person by reason of any act or omission performed or
omitted by such Indemnified Person in good faith in accordance with
this Guarantee Agreement and in a manner such Indemnified Person
reasonably believed to be within the scope of authority conferred
on such Indemnified Person by this Guarantee Agreement, except that
no Indemnified Person shall be entitled to be indemnified in
respect of any loss, damage or claim incurred by such Indemnified
Person by reason of negligence or willful misconduct with respect
to such acts or omissions.
(b) To the fullest extent permitted by applicable law,
expenses (including legal fees) incurred by an Indemnified Person
in defending any claim, demand, action, suit or proceeding shall,
from time to time, be advanced by the Guarantor prior to the final
disposition of such claim, demand, action, suit or proceeding upon
receipt by the Guarantor of any undertaking by or on behalf of the
Indemnified Person to repay such amount if it shall be determined
that the Indemnified Person is not entitled to be indemnified
as authorized in Section 8.2(a). The provisions of this Section
8.2 shall survive termination of this Guarantee Agreement and
resignation or removal of the Capital Guarantee Trustee.
ARTICLE IX
MISCELLANEOUS
Section 9.1. Successors and Assigns.
All guarantees and agreements contained in this Guarantee
Agreement shall bind the successors, assigns, receivers, trustees
and representatives of the Guarantor and shall inure to the benefit
of the Holders of the Capital Securities then outstanding.
Section 9.2. Amendments.
Except with respect to any changes that do not adversely
affect the rights of Holders (in which case no consent of Holders
will be required), this Guarantee Agreement may only be amended
with the prior approval of the Holders of at least 66-2/3% in
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 the outstanding Capital Securities. The
provisions of Section 12.2 of the Declaration with respect to
meetings of Holders of the Trust Securities apply to the giving of
such approval.
Section 9.3. Notices.
All notices provided for in this Guarantee Agreement
shall be in writing, duly signed by the party giving such notice,
and shall be delivered, telecopied or mailed by registered or
certified mail as follows:
(a) If given to the Capital Guarantee Trustee, at the Capital
Guarantee Trustee's mailing address set forth below (or
such other address as the Capital Guarantee Trustee may
give notice of to the Holders of the Capital Securities):
The First National Bank of Chicago
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(b) If given to the Guarantor, at the Guarantor's mailing
address set forth below (or such other address as the
Guarantor may give notice of to the Holders of the
Capital Securities):
Great Western Financial Corporation
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(c) If given to any Holder of Capital Securities, at
the address set forth in the books and records of
the Issuer.
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 9.4. Benefit.
This Guarantee Agreement is solely for the benefit of the
Holders of the Capital Securities and, subject to Section 3.1(a),
is not separately transferable from the Capital Securities.
Section 9.5. Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this
Guarantee Agreement to be executed by their respective officers
thereunto duly authorized, as of the day and year first above
written.
GREAT WESTERN FINANCIAL CORPORATION
By: _______________________________
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
as Capital Guarantee Trustee
By: _______________________________
Name:
Title: