EXHIBIT 4.5
DUKE ENERGY CAPITAL TRUST [ ]
AMENDED AND RESTATED
TRUST AGREEMENT
AMONG
DUKE ENERGY CORPORATION, AS DEPOSITOR,
THE CHASE MANHATTAN BANK, AS PROPERTY TRUSTEE
CHASE MANHATTAN BANK DELAWARE, AS DELAWARE TRUSTEE
AND
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III AND S.L. LOVE,
AS ADMINISTRATIVE TRUSTEES
DATED AS OF , 199
DUKE ENERGY CAPITAL TRUST [ ]
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Trust Agreement
Act Section Section
Section 310(a)(1).. 8.07
(a)(2)........ 8.07
(a)(3)........ 8.09
(a)(4)........ Not Applicable
(b)........... 8.08
Section 311(a)..... 8.13
(b)........... 8.13
Section 312(a)..... 5.07
(b)........... 5.07
(c)........... 5.07
Section 313(a)..... 8.14(a)
(a)(4)........ 8.14(b)
(b)........... 8.14(b)
(c)........... 8.14(a)
(d)........... 8.14(a), 8.14(b)
Section 314(a)..... 8.15
(b)........... Not Applicable
(c)(1)........ 8.15, 8.16
(c)(2)........ 8.16
(c)(3)........ 8.16
(d)........... Not Applicable
(e)........... 8.16
Section 315(a)..... 8.01
(b)........... 8.02, 8.14(b)
(c)........... 8.01(a)
(d)........... 8.01, 8.03
(e)........... Not Applicable
Section 316(a)..... Not Applicable
(a)(l)(A)..... 8.19
(a)(1)(B)..... 8.19
(a)(2)........ Not Applicable
(b)........... Not Applicable
(c)........... Not Applicable
Section 317(a)(1).. Not Applicable
(a)(2)........ Not Applicable
(b)........... 5.09
Section 318(a)..... 10.10
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Note: This Cross-Reference Table does not constitute part of the Trust
Agreement and shall not affect the interpretation of any of its terms and
provisions.
TABLE OF CONTENTS
Page
ARTICLE I Defined Terms........................................... 1
Section 1.01 Definitions............................................. 1
ARTICLE II Establishment of the Trust.............................. 9
Section 2.01 Name.................................................... 9
Section 2.02 Offices of the Trustees; Principal Place of Business.... 9
Section 2.03 Initial Contribution of Trust Property; Organizational
Expenses................................................ 9
Section 2.04 Issuance of the Preferred Securities.................... 10
Section 2.05 Subscription and Purchase of Junior Subordinated Notes;
Issuance of the Common Securities....................... 10
Section 2.06 Declaration of Trust.................................... 10
Section 2.07 Authorization to Enter into Certain Transactions........ 10
Section 2.08 Assets of Trust......................................... 15
Section 2.09 Title to Trust Property................................. 15
Section 2.10 Mergers and Consolidations of the Trust................. 15
ARTICLE III Payment Account......................................... 16
Section 3.01 Payment Account......................................... 16
ARTICLE IV Distributions; Redemption............................... 16
Section 4.01 Distributions........................................... 16
Section 4.02 Redemption.............................................. 17
Section 4.03 Subordination of Common Securities...................... 19
Section 4.04 Payment Procedures...................................... 19
Section 4.05 Tax Returns and Reports................................. 19
ARTICLE V Trust Securities Certificates........................... 20
Section 5.01 Initial Ownership....................................... 20
Section 5.02 The Trust Securities Certificates....................... 20
Section 5.03 Authentication of Trust Securities Certificates......... 20
Section 5.04 Registration of Transfer and Exchange of Preferred
Securities Certificates................................. 20
Section 5.05 Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates............................................ 21
Section 5.06 Persons Deemed Securityholders.......................... 21
Section 5.07 Access to List of Securityholders' Names and Addresses.. 21
Section 5.08 Maintenance of Office or Agency......................... 22
Section 5.09 Appointment of Paying Agent............................. 22
Section 5.10 Ownership of Common Securities by Depositor............. 23
Section 5.11 Book-Entry Preferred Securities Certificates; Common
Securities Certificate.................................. 23
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Section 5.12 Notices to Clearing Agency.............................. 24
Section 5.13 Definitive Preferred Securities Certificates............ 24
Section 5.14 Rights of Securityholders............................... 24
ARTICLE VI Acts of Securityholders; Meetings; Voting............... 25
Section 6.01 Limitations on Voting Rights............................ 25
Section 6.02 Notice of Meetings...................................... 26
Section 6.03 Meetings of Preferred Securityholders................... 26
Section 6.04 Voting Rights........................................... 26
Section 6.05 Proxies, etc............................................ 26
Section 6.06 Securityholder Action by Written Consent................ 27
Section 6.07 Record Date for Voting and Other Purposes............... 27
Section 6.08 Acts of Securityholders................................. 27
Section 6.09 Inspection of Records................................... 28
ARTICLE VII Representations and Warranties of the Property Trustee
and Delaware Trustee.................................... 28
Section 7.01 Representations and Warranties of the Property Trustee
and Delaware Trustee.................................... 28
ARTICLE VIII The Trustees............................................ 29
Section 8.01 Certain Duties and Responsibilities..................... 29
Section 8.02 Notice of Defaults...................................... 29
Section 8.03 Certain Rights of Property Trustee...................... 30
Section 8.04 Not Responsible for Recitals or Issuance of Securities.. 31
Section 8.05 May Hold Securities..................................... 31
Section 8.06 Compensation; Fees; Indemnity........................... 31
Section 8.07 Trustees Required; Eligibility.......................... 31
Section 8.08 Conflicting Interests................................... 32
Section 8.09 Co-Property Trustees and Separate Trustee............... 32
Section 8.10 Resignation and Removal; Appointment of Successor....... 33
Section 8.11 Acceptance of Appointment by Successor.................. 35
Section 8.12 Merger, Conversion, Consolidation or Succession to
Business................................................ 35
Section 8.13 Preferential Collection of Claims Against Depositor
or Trust................................................ 35
Section 8.14 Reports by Property Trustee............................. 36
Section 8.15 Reports to the Property Trustee......................... 36
Section 8.16 Evidence of Compliance with Conditions Precedent........ 36
Section 8.17 Number of Trustees...................................... 36
Section 8.18 Delegation of Power..................................... 37
Section 8.19 Enforcement of Rights of Property Trustee by
Securityholders......................................... 37
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ARTICLE IX Termination and Liquidation............................. 38
Section 9.01 Termination Upon Expiration Date........................ 38
Section 9.02 Early Termination....................................... 38
Section 9.03 Termination............................................. 38
Section 9.04 Liquidation............................................. 38
Section 9.05 Bankruptcy.............................................. 39
ARTICLE X Miscellaneous Provisions............................... 40
Section 10.01 Guarantee by the Depositor............................. 40
Section 10.02 Limitation of Rights of Securityholders................ 40
Section 10.03 Amendment.............................................. 40
Section 10.04 Separability........................................... 41
Section 10.05 Governing Law.......................................... 41
Section 10.06 Notice of Deferral of Distribution..................... 41
Section 10.07 Headings............................................... 41
Section 10.08 Notice and Demand...................................... 41
Section 10.09 Agreement Not to Petition.............................. 42
Section 10.10 Conflict with Trust Indenture Act...................... 42
Section 10.11 Successors............................................. 43
EXHIBIT A Restated Certificate of Trust
EXHIBIT B Form of Certificate Depository Agreement
EXHIBIT C Form of Common Securities Certificate
EXHIBIT D Form of Expense Agreement
EXHIBIT E Form of Preferred Securities Certificate
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AMENDED AND RESTATED TRUST AGREEMENT
THIS AMENDED AND RESTATED TRUST AGREEMENT is made as of , 199 ,
by and among (i) Duke Energy Corporation, a North Carolina corporation (the
"Depositor" or the "Corporation"), (ii) The Chase Manhattan Bank, a banking
corporation duly organized and existing under the laws of the State of New York,
as trustee (the "Property Trustee" and, in its separate corporate capacity and
not in its capacity as Property Trustee, the "Bank"), (iii) Chase Manhattan Bank
Delaware, a banking corporation duly organized under the laws of the State of
Delaware, as Delaware trustee (the "Delaware Trustee" and, in its separate
corporate capacity and not in its capacity as Delaware Trustee, the "Delaware
Bank"), (iv) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III, an individual, and S.L. Love, an individual,
as administrative trustees (each an "Administrative Trustee" and together the
"Administrative Trustees") (the Property Trustee, the Delaware Trustee and the
Administrative Trustees referred to collectively as the "Trustees") and (v) the
several Holders, as hereinafter defined.
WITNESSETH:
WHEREAS, the Depositor and the Delaware Trustee have heretofore duly
declared and established a business trust pursuant to the Delaware Business
Trust Act by the entering into that certain Trust Agreement, dated as of
November 14, 1997 (the "Original Trust Agreement"), and by the execution
and filing by the Delaware Trustee with the Secretary of State of the State of
Delaware of the Certificate of Trust, dated November 14, 1997 (the "Certificate
of Trust") and
WHEREAS, the parties hereto desire to amend and restate the Original Trust
Agreement in its entirety as set forth herein to provide for, among other
things, (i) the addition of the Bank, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III and S.L. Love as
trustees of the Trust, (ii) the acquisition by the Trust from the Depositor of
all of the right, title and interest in the Junior Subordinated Notes, (iii) the
issuance of the Common Securities by the Trust to the Depositor, and (iv) the
issuance and sale of the Preferred Securities by the Trust pursuant to the
Underwriting Agreement.
NOW THEREFORE, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the sufficiency of which
is hereby acknowledged, each party, for the benefit of the other parties and for
the benefit of the Securityholders, hereby amends and restates the Original
Trust Agreement in its entirety and agrees as follows:
ARTICLE I
DEFINED TERMS
Section 1.01 Definitions. For all purposes of this Trust Agreement,
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except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) unless the context otherwise requires, any reference to an "Article" or
a "Section" refers to an Article or a Section, as the case may be, of this Trust
Agreement; and
(d) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Trust Agreement as a whole and not to any particular
Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.08.
"Additional Amount" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, an amount equal to the Additional
Interest (as defined in clause (ii) of the definition of "Additional Interest"
in the Subordinated Indenture) paid by the Depositor on a Like Amount of Junior
Subordinated Notes for such period.
"Administrative Trustee" means each of the individuals identified as an
"Administrative Trustee" in the preamble to this Trust Agreement solely in their
capacities as Administrative Trustees of the Trust formed and continued
hereunder and not in their individual capacities, or such trustee's successor(s)
in interest in such capacity, or any successor "Administrative Trustee"
appointed as herein provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" has the meaning specified in the preamble to this Trust Agreement.
"Bankruptcy Event" means, with respect to any Person:
(i) the entry by a court having jurisdiction in the premises of (A)
a decree or order for relief in respect of such Person in an involuntary
case or proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or (B) a decree or order
adjudging such Person a bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of such Person under any applicable federal or
state law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of such Person or of any
substantial part of its property, or ordering the winding up or liquidation
of its affairs, and the continuance of any such decree or order for relief
or any such other decree or order unstayed and in effect for a period of 90
consecutive days; or
(ii) the commencement by such Person of a voluntary case or
proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of such Person in an involuntary
case or proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or to the commencement of
any bankruptcy or insolvency case or proceeding against it, or the filing
by it of a petition
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or answer or consent seeking reorganization or relief under any applicable
federal or state law, or the consent by it to the filing of such petition
or to the appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official of
the Corporation or of any substantial part of its property, or the making
by it of an assignment for the benefit of creditors, or the admission by it
in writing of its inability to pay its debts generally as they become due,
or the authorization of any such action by the board of directors of such
Person;
"Bankruptcy Laws" has the meaning specified in Section 10.09.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Depositor to have been duly adopted by the
Depositor's Board of Directors or a duly authorized committee thereof and to be
in full force and effect on the date of such certification, and delivered to the
Trustees.
"Book-Entry Preferred Securities Certificates" means certificates
representing Preferred Securities issued in global, fully registered form to the
Clearing Agency as described in Section 5.11.
"Business Day" means a day other than (i) a Saturday or a Sunday, (ii) a
day on which banks in New York, New York are authorized or obligated by law or
executive order to remain closed or (iii) a day on which the Corporate Trust
Office or the Indenture Trustee's principal corporate trust office is closed for
business.
"Certificate Depository Agreement" means the agreement among the Trust and
The Depository Trust Company, as the initial Clearing Agency, dated ,
199 , relating to the Preferred Securities Certificates, substantially in the
form attached as Exhibit B, as the same may be amended and supplemented from
time to time.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act. The Depository Trust Company will
be the initial Clearing Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Security" means an undivided beneficial ownership interest in the
assets of the Trust having a Liquidation Amount of $25 and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
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"Common Securities Certificate" means a certificate evidencing ownership of
a Common Security or Securities, substantially in the form attached as
Exhibit C.
"Corporate Trust Office" means the office of the Property Trustee located
in New York, New York at which its corporate trust business shall be principally
administered.
"Corporation" means Duke Energy Corporation, its successors and assigns.
"Definitive Preferred Securities Certificates" means either or both (as the
context requires) of (i) Preferred Securities Certificates issued in
certificated, fully registered form as provided in Section 5.11(a) and (ii)
Preferred Securities Certificates issued in certificated, fully registered form
as provided in Section 5.13.
"Delaware Bank" has the meaning specified in the preamble to this Trust
Agreement.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code Section 3801 et seq., as it may be amended from time to time.
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"Delaware Trustee" means the commercial bank or trust company or any other
person identified as the "Delaware Trustee" and has the meaning specified in the
preamble to this Trust Agreement solely in its capacity as Delaware Trustee of
the Trust formed and continued hereunder and not in its individual capacity, or
its successor in interest in such capacity, or any successor Delaware Trustee
appointed as herein provided.
"Depositor" means Duke Energy Corporation, in its capacity as "Depositor"
under this Trust Agreement, its successors and assigns.
"Distribution Date" has the meaning specified in Section 4.01(a).
"Distributions" means amounts payable in respect of the Trust Securities as
provided in Section 4.01.
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) the occurrence of an Indenture Event of Default; or
(ii) default by the Trust in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period of
30 days; or
(iii) default by the Trust in the payment of any Redemption Price
of any Trust Security when it becomes due and payable; or
(iv) default in the performance, or breach, of any covenant or
warranty of the Trustees in this Trust Agreement (other than a covenant or
warranty a default in whose performance or breach is dealt with in clause
(ii) or (iii) above) and continuation of such default or breach for a
period of 60 days after there has been given, by registered or
4
certified mail, to the Trustees by the Holders of at least 25% in
Liquidation Amount of the Outstanding Preferred Securities a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder; unless Holders
in Liquidation Amount of Outstanding Preferred Securities not less than the
Liquidation Amount of Outstanding Preferred Securities the Holders of which
gave such notice, shall agree in writing to an extension of such period
prior to its expiration; provided, however, that the Holders of such
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Liquidation Amount of Outstanding Preferred Securities shall be deemed to
have agreed to an extension of such period if corrective action is
initiated by the Trustees within such period and is being diligently
pursued; or
(v) the occurrence of a Bankruptcy Event with respect to the Trust.
"Expense Agreement" means the Agreement as to Expenses and Liabilities
between the Corporation and the Trust, substantially in the form attached as
Exhibit D, as amended from time to time.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, or any successor legislation.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Corporation and The Chase Manhattan Bank, as Guarantee Trustee,
contemporaneously with the execution and delivery of this Trust Agreement, for
the benefit of the Holders of the Preferred Securities, as amended from time to
time.
"Indenture Event of Default" means an "Event of Default" as defined in the
Subordinated Indenture with respect to the Junior Subordinated Notes.
"Indenture Redemption Date" means "Redemption Date", as defined in the
Subordinated Indenture.
"Indenture Trustee" means the trustee under the Subordinated Indenture.
"Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"Issue Date" means the date of the delivery of the Trust Securities.
"Junior Subordinated Notes" means the $ aggregate principal
amount of the Depositor's Series % Junior Subordinated Notes due
, issued pursuant to the Subordinated Indenture.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (i) Trust Securities having a Liquidation Amount equal
to the principal amount of Junior Subordinated Notes to be contemporaneously
redeemed in accordance with the Subordinated Indenture and the proceeds of which
will be used to pay the Redemption
5
Price of such Trust Securities and (ii) Junior Subordinated Notes having a
principal amount equal to the Liquidation Amount of the Trust Securities of the
Holder to whom such Junior Subordinated Notes are distributed.
"Liquidation Amount" means the stated amount of $25 per Trust Security.
"Liquidation Date" means the date on which Junior Subordinated Notes are to
be distributed to Holders of Trust Securities in connection with a liquidation
of the Trust pursuant to Section 9.04.
"Liquidation Distribution" has the meaning specified in Section 9.05.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary, of the Depositor, and
delivered to the appropriate Trustee. One of the officers signing an Officers'
Certificate to be delivered by the Depositor pursuant to Section 8.16 shall be
the principal executive, financial or accounting officer of the Depositor. An
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate
has read such covenant or condition and the definitions herein relating
thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in the
Officers' Certificate are based;
(c) a statement that, in the opinion of each such officer, he has made
such examination or investigation as is necessary to enable him 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.
"OID" means "original issue discount" as that term is defined in the
Internal Revenue Code of 1986, as amended.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Trust, the Trustees or the Depositor, but not an employee of the Trust
or the Trustees, and who shall be reasonably acceptable to the Property Trustee.
Any Opinion of Counsel pertaining to federal income tax matters may rely on
published rulings of the Internal Revenue Service.
"Original Trust Agreement" has the meaning specified in the recitals to
this Trust Agreement.
"Outstanding", when used with respect to Preferred Securities, means, as of
the date of determination, all Preferred Securities theretofore authenticated
and delivered under this Trust Agreement, except:
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(i) Preferred Securities theretofore cancelled by the Administrative
Trustees or delivered to the Administrative Trustees for cancellation;
(ii) Preferred Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Property Trustee
or any Paying Agent for the Holders of such Preferred Securities; provided
that if such Preferred Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Trust Agreement or
provision therefor satisfactory to the Property Trustee has been made; and
(iii) Preferred Securities in exchange for or in lieu of which other
Preferred Securities have been authenticated and delivered pursuant to this
Trust Agreement;
provided, however, that in determining whether the Holders of the requisite
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Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Preferred Securities owned, whether of record or beneficially, by the Depositor,
the Holder of the Common Securities, any Administrative Trustee or any Affiliate
of the Depositor or any Administrative Trustee shall be disregarded and deemed
not to be Outstanding, except that (a) in determining whether any Trustee shall
be protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Preferred Securities which such Trustee knows to
be so owned shall be so disregarded and (b) the foregoing shall not apply at any
time when all of the outstanding Preferred Securities are owned by the
Depositor, the Holder of the Common Securities, one or more Administrative
Trustees and/or any such Affiliate. Preferred Securities so owned which have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Administrative Trustees the pledgee's
right so to act with respect to such Preferred Securities and that the pledgee
is not the Depositor or any Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of a Book-Entry
Preferred Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the Owner, then as reflected
in the records of a Person maintaining an account with such Clearing Agency
(directly or indirectly, in accordance with the rules of such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed pursuant
to Section 5.09 and shall initially be the Property Trustee.
"Payment Account" means a segregated non-interest-bearing corporate trust
account maintained by the Property Trustee for the benefit of the
Securityholders in which all amounts paid in respect of the Junior Subordinated
Notes will be held and from which the Property Trustee shall make payments to
the Securityholders in accordance with Section 4.01.
"Person" means an individual, corporation, partnership, joint venture,
trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial ownership interest in
the assets of the Trust having a Liquidation Amount of $25 and having rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
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"Preferred Securities Certificate" means a certificate evidencing ownership
of a Preferred Security or Securities, substantially in the form attached as
Exhibit E.
"Property Trustee" means the commercial bank or trust company identified as
the "Property Trustee" in the preamble to this Trust Agreement solely in its
capacity as Property Trustee of the Trust formed and continued hereunder and not
in its individual capacity, or its successor in interest in such capacity, or
any successor "Property Trustee" as herein provided.
"Redemption Date" means, with respect to any Trust Security to be redeemed,
the date fixed for such redemption by or pursuant to this Trust Agreement;
provided that each Indenture Redemption Date shall be a Redemption Date for a
Like Amount of Trust Securities.
"Redemption Price" means, with respect to any date fixed for redemption of
any Trust Security, the Liquidation Amount of such Trust Security, plus accrued
and unpaid Distributions to such date.
"Relevant Trustee" has the meaning specified in Section 8.10.
"Securities Act" means the Securities Act of 1933, as amended from time to
time, or any successor legislation.
"Security Register" and "Security Registrar" are described in Section 5.04.
"Securityholder" or "Holder" means a Person in whose name a Trust Security
or Securities is registered in the Security Register; any such Person is a
beneficial owner within the meaning of the Delaware Business Trust Act.
"Subordinated Indenture" means the Subordinated Indenture, dated as of ,
199 , between the Depositor and the Indenture Trustee, as supplemented by the
Supplemental Indenture.
"Supplemental Indenture" means the Supplemental Indenture, dated as
of , 199 , by and between the Depositor and the Indenture Trustee.
"Trust" means the Delaware business trust continued hereby and identified
on the cover page to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as the
same may be modified, amended or supplemented in accordance with the applicable
provisions hereof, including all exhibits hereto, including, for all purposes of
this Amended and Restated Trust Agreement and any modification, amendment or
supplement, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this Amended and Restated Trust Agreement and any such
modification, amendment or supplement, respectively.
"Trustees" means the Persons identified as "Trustees" in the preamble to
this Trust Agreement solely in their capacities as Trustees of the Trust formed
hereunder and not in their individual capacities, or any successor in interest
in such capacity, or any successor trustee appointed as herein provided.
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"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
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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 Property" means (i) the Junior Subordinated Notes, (ii) any cash on
deposit in, or owing to, the Payment Account, and (iii) all proceeds and rights
in respect of the foregoing and any other property and assets for the time being
held or deemed to be held by the Property Trustee pursuant to this Trust
Agreement.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"Trust Security" means any one of the Common Securities or the Preferred
Securities.
"Underwriting Agreement" means the Underwriting Agreement, dated as of ,
199 , among the Trust, the Depositor and the underwriters named therein.
ARTICLE II
ESTABLISHMENT OF THE TRUST
Section 2.01 Name. The Trust continued hereby shall be known as "Duke
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Energy Capital Trust [ ]", in which name the Trustees may conduct the business
of the Trust, make and execute contracts and other instruments on behalf of the
Trust and ▇▇▇ and be sued. The Administrative Trustees may change the name of
the Trust from time to time following written notice to the Holders.
Section 2.02 Offices of the Trustees; Principal Place of Business. The
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address of the Property Trustee is The Chase Manhattan Bank, ▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such other address in New York as the
Property Trustee may designate by written notice to the Securityholders and the
Depositor. The principal place of business of the Delaware Trustee is ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other address in Delaware
as the Delaware Trustee may designate by notice to the Depositor. The address
of the Administrative Trustees is c/o Duke Energy Corporation, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Secretary. The
principal place of business of the Trust is c/o Duke Energy Corporation, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇. The Depositor may change
the principal place of business of the Trust at any time by giving notice
thereof to the Trustees.
Section 2.03 Initial Contribution of Trust Property; Organizational
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Expenses. The Delaware Trustee acknowledges receipt in trust from the Depositor
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in connection with the Original Trust Agreement of the sum of $10, which
constituted the initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of the Trustees,
promptly reimburse the Trustees for any such expenses paid by the Trustees. The
Depositor shall make no claim upon the Trust Property for the payment of such
expenses.
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Section 2.04 Issuance of the Preferred Securities. Contemporaneously with
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the execution and delivery of this Trust Agreement, the Administrative Trustees,
on behalf of the Trust, shall execute and deliver to the underwriters named in
the Underwriting Agreement Preferred Securities Certificates, registered in the
name of the nominee of the initial Clearing Agency, in an aggregate amount of
Preferred Securities having an aggregate Liquidation Amount of
$ (the "Preferred Securities") against receipt of the aggregate
purchase price of such Preferred Securities of $ , which amount the
Administrative Trustees shall promptly deliver to the Property Trustee.
Section 2.05 Subscription and Purchase of Junior Subordinated Notes;
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Issuance of the Common Securities. Contemporaneously with the execution and
---------------------------------
delivery of this Trust Agreement, the Administrative Trustees, on behalf of the
Trust, shall execute and deliver to the Depositor Common Securities
Certificates, registered in the name of the Depositor, in an aggregate amount of
Common Securities having an aggregate Liquidation Amount of $ ,
against payment by the Depositor of such amount. Contemporaneously therewith,
the Administrative Trustees, on behalf of the Trust, shall subscribe to and
purchase from the Depositor Junior Subordinated Notes, registered in the name of
the Property Trustee, on behalf of the Trust and the Holders, and having an
aggregate principal amount equal to $ and, in satisfaction of the
purchase price for such Junior Subordinated Notes, the Property Trustee, on
behalf of the Trust, shall deliver to the Depositor the sum of $ .
Section 2.06 Declaration of Trust. The exclusive purposes and functions
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of the Trust are (i) to issue and sell the Trust Securities and use the proceeds
from such sale to acquire the Junior Subordinated Notes, and (ii) to engage in
only those other activities necessary, incidental, appropriate or convenient
thereto. The Depositor hereby appoints each of the Bank, the Delaware Bank,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III, and S.L. Love as trustees of the Trust, to have all the
rights, powers and duties to the extent set forth herein. The Property Trustee
hereby declares that it will hold the Trust Property in trust upon and subject
to the conditions set forth herein subject to the conditions set forth herein
for the benefit of the Trust and the Securityholders. The Trustees shall have
all rights, powers and duties set forth herein and in accordance with applicable
law with respect to accomplishing the purposes of the Trust. The Delaware
Trustee shall not be entitled to exercise any powers, nor shall the Delaware
Trustee have any of the duties and responsibilities of the Property Trustee or
the Administrative Trustees set forth herein. The Delaware Trustee shall be one
of the Trustees for the sole and limited purpose of fulfilling the requirements
of the Delaware Business Trust Act. The Delaware Trustee, as the trustee under
the Original Trust Agreement, has filed the Certificate of Trust of the Trust
with the office of the Secretary of State of the State of Delaware, a copy of
which is attached hereto as Exhibit A, and such filing is hereby confirmed and
ratified.
Section 2.07 Authorization to Enter into Certain Transactions. The
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Trustees shall conduct the affairs of the Trust in accordance with the terms of
this Trust Agreement. Subject to the limitations set forth in paragraph (C) of
this Section, and in accordance with the following paragraphs (A) and (B), the
Trustees shall have the authority to enter into all transactions and agreements
determined by the Trustees to be appropriate in exercising the authority,
express (in the case of the Property Trustee) or implied, otherwise granted to
the Trustees under this Trust Agreement, and to perform all acts in furtherance
thereof, including without limitation, the following:
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(A) As among the Trustees, the Administrative Trustees, acting singly or
jointly, shall have the exclusive power, duty and authority to act on behalf of
the Trust with respect to the following matters:
(i) to acquire the Junior Subordinated Notes with the proceeds of
the sale of the Trust Securities; provided, however, the Administrative
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Trustees shall cause legal title to all of the Junior Subordinated Notes to
be vested in, and the Junior Subordinated Notes to be held of record in the
name of, the Property Trustee for the benefit of the Trust and the Holders
of the Trust Securities;
(ii) to give the Depositor and the Property Trustee prompt written
notice of the occurrence of any Special Event (as defined in the
Supplemental Indenture) and to take any ministerial actions in connection
therewith; provided that the Administrative Trustees shall consult with the
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Depositor and the Property Trustee before taking or refraining to take any
ministerial action in relation to a Special Event;
(iii) to establish a record date with respect to all actions to
be taken hereunder that require a record date be established, including for
the purposes of (S) 316(c) of the Trust Indenture Act and with respect to
Distributions, voting rights, redemptions, and exchanges, and to issue
relevant notices to Holders of the Trust Securities as to such actions and
applicable record dates;
(iv) to bring or defend, pay, collect, compromise, arbitrate,
resort to legal action, or otherwise adjust claims or demands of or against
the Trust ("Legal Action"), unless pursuant to Section 2.07(B)(v), the
Property Trustee has the power to bring such Legal Action;
(v) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors,
and consultants and pay reasonable compensation for such services;
(vi) to cause the Trust to comply with the Trust's obligations
under the Trust Indenture Act;
(vii) to give the certificate to the Property Trustee required by
(S) 314(a)(4) of the Trust Indenture Act, which certificate may be executed
by any Administrative Trustee;
(viii) to take all actions and perform such duties as may be
required of the Administrative Trustees pursuant to the terms of this Trust
Agreement;
(ix) to take all action that may be necessary or appropriate for
the preservation and the continuation of the Trust's valid existence,
rights, franchises and privileges as a statutory business trust under the
laws of the State of Delaware and of each other jurisdiction in which such
existence is necessary to protect the limited liability of the Holders of
the Trust Securities or to enable the Trust to effect the purposes for
which the Trust has been created;
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(x) to take all action necessary to cause all applicable tax
returns and tax information reports that are required to be filed with
respect to the Trust to be duly prepared and filed by the Administrative
Trustees, on behalf of the Trust;
(xi) to issue and sell the Trust Securities;
(xii) to cause the Trust to enter into, and to execute, deliver
and perform on behalf of the Trust, the Expense Agreement and such other
agreements as may be necessary or desirable in connection with the
consummation hereof;
(xiii) to assist in the registration of the Preferred Securities
under the Securities Act and under state securities or blue sky laws, and
the qualification of the Trust Agreement as a trust indenture under the
Trust Indenture Act;
(xiv) to assist in the listing of the Preferred Securities upon
such securities exchange or exchanges as shall be determined by the
Depositor and, if required, the registration of the Preferred Securities
under the Exchange Act, and the preparation and filing of all periodic and
other reports and other documents pursuant to the foregoing;
(xv) to send notices (other than notices of default) and other
information regarding the Trust Securities and the Junior Subordinated
Notes to the Securityholders in accordance with this Trust Agreement;
(xvi) to appoint a Paying Agent (subject to Section 5.09),
authenticating agent and Security Registrar in accordance with this Trust
Agreement;
(xvii) to register transfers of the Trust Securities in
accordance with this Trust Agreement;
(xviii) to assist in, to the extent provided in this Trust
Agreement, the winding up of the affairs of and termination of the Trust
and the preparation, execution and filing of the certificate of
cancellation with the Secretary of State of the State of Delaware; and
(xix) to take any action incidental to the foregoing as the
Administrative Trustees may from time to time determine is necessary,
appropriate, convenient or advisable to protect and conserve the Trust
Property for the benefit of the Securityholders (without consideration of
the effect of any such action on any particular Securityholder).
(B) As among the Trustees, the Property Trustee shall have the exclusive
power, duty and authority to act on behalf of the Trust with respect to the
following matters:
(i) engage in such ministerial activities as shall be necessary or
appropriate to effect promptly the redemption of the Trust Securities to
the extent the Junior Subordinated Notes are redeemed or mature;
(ii) upon notice of distribution issued by the Administrative
Trustees in accordance with the terms of this Trust Agreement, engage in
such ministerial activities as shall be necessary or appropriate to effect
promptly the distribution pursuant to the
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terms of this Trust Agreement of Junior Subordinated Notes to Holders of
Trust Securities;
(iii) subject to the terms hereof, exercise all of the rights,
powers and privileges of a holder of the Junior Subordinated Notes under
the Subordinated Indenture and, if an Event of Default occurs and is
continuing, enforce for the benefit of, and subject to the rights of, the
Holders of the Trust Securities, its rights as holder of the Junior
Subordinated Notes under the Subordinated Indenture;
(iv) take all actions and perform such duties as may be
specifically required of the Property Trustee pursuant to the terms of this
Trust Agreement;
(v) take any Legal Action which arises out of or in connection
with an Event of Default or the Property Trustee's duties and obligations
under this Trust Agreement, the Delaware Business Trust Act or the Trust
Indenture Act;
(vi) the establishment and maintenance of the Payment Account;
(vii) the receipt of and holding of legal title to the Junior
Subordinated Notes as described herein;
(viii) the collection of interest, principal and any other
payments made in respect of the Junior Subordinated Notes in the Payment
Account;
(ix) the distribution of amounts received in the Payment Account
and owed to the Securityholders in respect of the Trust Securities;
(x) the sending of notices of default and other information
regarding the Trust Securities and the Junior Subordinated Notes to the
Securityholders in accordance with this Trust Agreement;
(xi) the distribution of the Trust Property in accordance with the
terms of this Trust Agreement;
(xii) as provided in this Trust Agreement, the winding up of the
affairs of and termination of the Trust and the preparation, execution and
filing of the certificate of cancellation with the Secretary of State of
Delaware; and
(xiii) the taking of any action incidental to the foregoing as
the Property Trustee may from time to time determine is necessary,
appropriate, convenient or advisable to protect and conserve the Trust
Property for the benefit of the Securityholders (without consideration of
the effect of any such action on any particular Securityholder).
(C) So long as this Trust Agreement remains in effect, the Trust (or the
Trustees acting on behalf of the Trust) shall not undertake any business,
activity or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees shall not (i) acquire any investments or
engage in any activities not authorized by this Trust Agreement, (ii) sell,
assign, transfer, exchange, pledge, set-off or otherwise dispose of any of the
Trust Property or interests therein, including to Securityholders, except as
expressly provided herein, (iii) take any
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action that 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, (v) take or consent to any action that would result in the
placement of a Lien on any of the Trust Property, (vi) issue any securities
other than the Trust Securities, or (vii) have any power to, or agree to any
action by the Depositor that would, vary the investment (within the meaning of
Treasury Regulation Section 301.7701-4(c)) of the Trust or of the
Securityholders. The Trustees shall defend all claims and demands of all
Persons at any time claiming any Lien on any of the Trust Property adverse to
the interest of the Trust or the Securityholders in their capacity as
Securityholders.
(D) In connection with the issue and sale of the Preferred Securities, the
Depositor shall have the right and responsibility to assist the Trust with
respect to, or effect on behalf of the Trust, the following (and any actions
taken by the Depositor in furtherance of the following prior to the date of this
Trust Agreement are hereby ratified and confirmed in all respects):
(i) to prepare for filing by the Trust with the Commission a
registration statement on Form S-3 under the Securities Act in relation to
the Preferred Securities, including any amendments thereto;
(ii) to determine the states in which to take appropriate action
to qualify or register for sale all or part of the Preferred Securities and
to do any and all such acts, other than actions which must be taken by or
on behalf of the Trust, and advise the Trustees of actions they must take
on behalf of the Trust, and prepare for execution and filing any documents
to be executed and filed by the Trust or on behalf of the Trust, as the
Depositor deems necessary or advisable in order to comply with the
applicable laws of any such states;
(iii) to prepare for filing by the Trust an application to the
New York Stock Exchange or any other national stock exchange or the NASDAQ
National Market for listing upon notice of issuance of any Preferred
Securities;
(iv) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A relating to the registration of the
Preferred Securities under Section 12(b) of the Exchange Act, including any
amendments thereto;
(v) to negotiate the terms of the Underwriting Agreement providing
for the sale of the Preferred Securities and to execute, deliver and
perform the Underwriting Agreement on behalf of the Trust;
(vi) to negotiate the terms of the Certificate Depository
Agreement relating to the Preferred Securities and to execute, deliver and
perform the Certificate Depository Agreement on behalf of the Trust; and
(vii) any other actions necessary, incidental, appropriate or
convenient to carry out any of the foregoing activities.
(E) Notwithstanding anything herein to the contrary, the Administrative
Trustees are authorized and directed to conduct the affairs of the Trust and to
operate the Trust so that the Trust will not be deemed to be an "investment
company" required to be registered under the Investment Company Act, or taxed as
other than a grantor trust for United States federal income tax purposes and so
that the Junior Subordinated Notes will be treated as indebtedness of the
Depositor for United States federal income tax purposes. In this connection,
the Depositor and the Administrative Trustees are authorized to take any action,
not inconsistent with applicable law, the Certificate of Trust or this Trust
Agreement, that each of the Depositor and the
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Administrative Trustees determines in its discretion to be necessary or
desirable for such purposes, as long as such action does not materially and
adversely affect the interests of the Holders of the Preferred Securities.
Section 2.08 Assets of Trust. The assets of the Trust shall consist of
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the Trust Property.
Section 2.09 Title to Trust Property. Legal title to all Trust Property
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shall be vested at all times in the Property Trustee (in its capacity as such)
and shall be held and administered by the Property Trustee for the benefit of
the Securityholders and the Trust in accordance with this Trust Agreement. The
right, title and interest of the Property Trustee to the Junior Subordinated
Notes shall vest automatically in each Person who may thereafter be appointed as
Property Trustee in accordance with the terms hereof. Such vesting and
cessation of title shall be effective whether or not conveyancing documents have
been executed and delivered.
Section 2.10 Mergers and Consolidations of the Trust. The Trust may not
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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 entity, except as described below. The Trust may at the
request of the Corporation, with the consent of the Administrative Trustees and
without the consent of the Holders of the Trust Securities, consolidate,
amalgamate, merge with or into, or be replaced by a trust organized as such
under the laws of any state; provided that (i) such successor entity either (x)
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expressly assumes all of the obligations of the Trust with respect to the Trust
Securities or (y) substitutes for the Preferred Securities other securities
having substantially the same terms as the Trust Securities (herein referred to
as the "Successor Securities") so long as the Successor Securities rank the same
as the Trust Securities rank in priority with respect to Distributions and
payments upon liquidation, redemption and otherwise, (ii) the Corporation
expressly appoints a trustee of such successor entity possessing the same powers
and duties as the Property Trustee as the holder of legal title to the Junior
Subordinated Notes, (iii) the Preferred Securities or any Successor Securities
are listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or other organization on which the
Preferred Securities are then listed, (iv) such merger, consolidation,
amalgamation or replacement does not cause the Preferred Securities (including
any Successor Securities) to be downgraded by any nationally recognized
statistical rating organization, (v) such consolidation, amalgamation, merger or
replacement does not adversely affect the rights, preferences and privileges of
the Holders of the Trust Securities (including any Successor Securities) in any
material respect, (vi) such successor entity has a purpose substantially
identical to that of the Trust, (vii) prior to such consolidation, amalgamation,
merger or replacement, the Corporation and the Property Trustee have received an
Opinion of Counsel experienced in such matters to the effect that (A) such
consolidation, amalgamation, merger or replacement does not adversely affect the
rights, preferences and privileges of the Holders of the Trust Securities
(including any Successor Securities) in any material respect, and (B) following
such consolidation, amalgamation, merger or replacement, neither the Trust nor
such successor entity will be required to register as an investment company
under the Investment Company Act, and (viii) the Corporation owns all of the
common securities of such successor entity and guarantees the obligations of
such successor entity under the Successor Securities at least to the extent
provided by the Guarantee. Notwithstanding the foregoing, the Trust shall not,
except with the consent of Holders of 100% in Liquidation Amount of the Trust
Securities, consolidate, amalgamate, merge with or into, or be replaced by any
other entity or permit any other entity to consolidate, amalgamate, merge with
or into, or replace it if such consolidation,
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amalgamation, merger or replacement would cause the Trust or the successor
entity to be classified as other than a grantor trust for United States federal
income tax purposes.
ARTICLE III
PAYMENT ACCOUNT
Section 3.01 Payment Account.
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(a) On or prior to the Issue Date, the Property Trustee shall establish the
Payment Account. The Property Trustee and an agent of the Property Trustee
shall have exclusive control and sole right of withdrawal with respect to the
Payment Account for the purpose of making deposits in and withdrawals from the
Payment Account in accordance with this Trust Agreement. All monies and other
property deposited or held from time to time in the Payment Account shall be
held by the Property Trustee in the Payment Account for the exclusive benefit of
the Securityholders and for distribution as herein provided, including (and
subject to) any priority of payments provided for herein.
(b) The Property Trustee shall deposit in the Payment Account, promptly
upon receipt, all payments of principal or interest on, and any other payments
or proceeds with respect to, the Junior Subordinated Notes. Amounts held in the
Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
Section 4.01 Distributions.
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(a) Distributions on the Trust Securities shall be cumulative and accrue
from the Issue Date and, except in the event that the Depositor exercises its
right to extend the interest payment period for the Junior Subordinated Notes
pursuant to Section 104 of the Supplemental Indenture, shall be payable
quarterly in arrears on March 31, June 30, September 30 and December 31 of each
year, commencing on , 199 . If any date on which Distributions are
otherwise payable on the Trust Securities is not a Business Day, then the
payment of such Distribution shall be made on the next succeeding day which is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day is in the next succeeding calendar
year, payment of such Distribution shall be made on the immediately preceding
Business Day, in each case, with the same force and effect as if made on such
date (each such date, a "Distribution Date").
(b) Distributions payable on the Trust Securities shall be fixed at a rate
of % per annum of the Liquidation Amount of the Trust Securities. The amount
of Distributions payable for any full quarterly period shall be computed on the
basis of twelve 30-day months and a 360-day year. If the interest payment
period for the Junior Subordinated Notes is extended pursuant to Section 104 of
the Supplemental Indenture (an "Extension Period"), then the rate per annum at
which Distributions on the Trust Securities accumulate shall be increased by an
amount such
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that the aggregate amount of Distributions that accumulate on all Trust
Securities during any such Extension Period is equal to the aggregate amount of
interest (including interest payable on unpaid interest at the percentage rate
per annum set forth above, compounded quarterly, to the extent permitted by
applicable law) that accrues during any such Extension Period on the Junior
Subordinated Notes. The payment of such deferred interest, together with
interest thereon, will be distributed, if funds are legally available therefor,
to the Holders of the Trust Securities as received at the end of any Extension
Period. The amount of Distributions payable for any period shall include the
Additional Amounts, if any.
(c) Distributions on the Trust Securities shall be made and shall be deemed
payable on each Distribution Date only to the extent that the Trust has legally
and immediately available funds in the Payment Account for the payment of such
Distributions.
(d) Distributions (including Additional Amounts, if any) on the Trust
Securities on each Distribution Date shall be payable to the Holders thereof as
they appear on the Security Register for the Trust Securities on the relevant
record date, which shall be the close of business on the fifteenth calendar day
prior to the relevant Distribution Date.
Each Trust Security upon registration of transfer of or in exchange for or
in lieu of any other Trust Security shall carry the rights of Distributions
accrued (including Additional Amounts, if any) and unpaid, and to accrue
(including Additional Amounts, if any), which were carried by such other Trust
Security.
Section 4.02 Redemption.
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(a) On each Redemption Date with respect to the Junior Subordinated Notes,
the Trust will be required to redeem a Like Amount of Trust Securities at the
Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by first-
class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior
to the Redemption Date to each Holder of Trust Securities to be redeemed, at
such Holder's address appearing in the Security Register. All notices of
redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities are to be
redeemed, the total Liquidation Amount of the Trust Securities to be
redeemed; and
(v) that on the Redemption Date the Redemption Price will become
due and payable upon each such Trust Security to be redeemed and the
Distributions thereon will cease to accrue on and after such date.
(c) The Trust Securities redeemed on each Redemption Date shall be redeemed
at the Redemption Price with the proceeds from the contemporaneous redemption of
Junior Subordinated Notes. Redemptions of the Trust Securities shall be made
and the Redemption
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Price shall be deemed payable on each Redemption Date only to the extent that
the Trust has funds legally and immediately available in the Payment Account for
the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect of any
Preferred Securities, then, by 2:00 P.M. New York City time, on the Redemption
Date, subject to Section 4.02(c), the Property Trustee will, so long as the
Preferred Securities are in book-entry only form, irrevocably deposit with the
Clearing Agency for the Preferred Securities funds sufficient to pay the
applicable Redemption Price. If the Preferred Securities are not in book-entry
only form, the Property Trustee, subject to Section 4.02(c), shall irrevocably
deposit with the Paying Agent funds sufficient to pay the applicable Redemption
Price and will give the Paying Agent irrevocable instructions to pay the
Redemption Price to the Holders thereof upon surrender of their Preferred
Securities Certificates. Notwithstanding the foregoing, Distributions payable on
or prior to the Redemption Date for any Trust Securities called for redemption
shall be payable to the Holders of such Trust Securities as they appear on the
Security Register for the Trust Securities on the relevant record dates for the
related Distribution Dates. If notice of redemption shall have been given and
funds deposited as required, then immediately prior to the close of business on
the date of such deposit, all rights of Securityholders holding Trust Securities
so called for redemption will cease, except the right of such Securityholders to
receive the Redemption Price, but without interest, and such Securities will
cease to be outstanding. In the event that any date on which any Redemption
Price is payable is not a Business Day, then payment of the Redemption Price
payable on such date shall be made on the next succeeding day which is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day is in the next succeeding calendar
year, payment of such Redemption Price shall be made on the immediately
preceding Business Day, in each case, with the same force and effect as if made
on such date. In the event that payment of the Redemption Price in respect of
Trust Securities is improperly withheld or refused and not paid either by the
Trust or by the Depositor pursuant to the Guarantee, Distributions on such Trust
Securities will continue to accrue at the then applicable rate, from such
Redemption Date originally established by the Trust for such Preferred
Securities to the date such Redemption Price is actually paid.
(e) Payment of the Redemption Price on the Trust Securities shall be made
to the recordholders thereof as they appear on the Security Register for the
Trust Securities on the relevant record date, which shall be the close of
business on the fifteenth calendar day prior to the Redemption Date.
(f) If less than all the Outstanding Trust Securities are to be redeemed on
a Redemption Date, then the aggregate Liquidation Amount of Trust Securities to
be redeemed shall be allocated 3% to the Common Securities and 97% to the
Preferred Securities, with such adjustments that each amount so allocated shall
be divisible by $25. The particular Preferred Securities to be redeemed shall
be selected not more than 60 days prior to the Redemption Date by the Property
Trustee from the Outstanding Preferred Securities not previously called for
redemption, by such method as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $25 or integral multiple thereof) of the Liquidation Amount of
Preferred Securities of a denomination larger than $25; provided, however, that
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before undertaking redemption of the Preferred Securities on other than a pro
rata basis, the Property Trustee shall have received an Opinion of Counsel that
the status of the Trust as a grantor trust for United States federal income tax
purposes would not be adversely affected. The Property Trustee shall promptly
notify the Security Registrar in writing
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of the Preferred Securities selected for redemption and, in the case of any
Preferred Securities selected for partial redemption, the Liquidation Amount
thereof to be redeemed. For all purposes of this Trust Agreement, unless the
context otherwise requires, all provisions relating to the redemption of
Preferred Securities shall relate, in the case of any Preferred Securities
redeemed or to be redeemed only in part, to the portion of the Liquidation
Amount of Preferred Securities which has been or is to be redeemed.
(g) Subject to the foregoing provisions of Section 4.02 and to applicable
law (including, without limitation, United States federal securities laws), the
Corporation or its Affiliates may, at any time and from time to time, purchase
outstanding Preferred Securities by tender, in the open market or by private
agreement.
Section 4.03 Subordination of Common Securities.
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(a) Payment of Distributions (including Additional Amounts, if applicable)
on, and the Redemption Price of, the Trust Securities, as applicable, shall be
made pro rata based on the Liquidation Amount of the Trust Securities; provided,
--------
however, that if on any Distribution Date or Redemption Date an Indenture Event
-------
of Default shall have occurred and be continuing, no payment of any Distribution
(including Additional Amounts, if applicable) on, or Redemption Price of, any
Common Security, and no other payment on account of the redemption, liquidation
or other acquisition of Common Securities, shall be made unless payment in full
in cash of all accumulated and unpaid Distributions (including Additional
Amounts, if applicable) on all Outstanding Preferred Securities for all
distribution periods terminating on or prior thereto, or in the case of payment
of the Redemption Price the full amount of such Redemption Price on all
Outstanding Preferred Securities, shall have been made or provided for, and all
funds immediately available to the Property Trustee shall first be applied to
the payment in full in cash of all Distributions (including Additional Amounts,
if applicable) on, or the Redemption Price of, Preferred Securities then due and
payable.
(b) In the case of the occurrence of any Indenture Event of Default, the
Holder of Common Securities will be deemed to have waived any such Event of
Default under this Trust Agreement until the effect of all such Events of
Default with respect to the Preferred Securities have been cured, waived or
otherwise eliminated. Until any such Events of Default under this Trust
Agreement with respect to the Preferred Securities have been so cured, waived or
otherwise eliminated, the Property Trustee shall act solely on behalf of the
Holders of the Preferred Securities and not the Holder of the Common Securities,
and only the Holders of the Preferred Securities will have the right to direct
the Property Trustee to act on their behalf.
Section 4.04 Payment Procedures. Payments in respect of the Preferred
------------------
Securities shall be made by check mailed to the address of the Person entitled
thereto as such address shall appear on the Security Register or, if the
Preferred Securities are held by a Clearing Agency, such Distributions shall be
made to the Clearing Agency, which shall credit the relevant Persons' accounts
at such Clearing Agency on the applicable distribution dates. Payments in
respect of the Common Securities shall be made in such manner as shall be
mutually agreed between the Property Trustee and the Holder of the Common
Securities.
Section 4.05 Tax Returns and Reports. The Administrative Trustee(s) shall
-----------------------
prepare (or cause to be prepared), at the Depositor's expense, and file all
United States federal, state and local tax and information returns and reports
required to be filed by or in respect of the Trust.
19
The Administrative Trustee(s) shall provide or cause to be provided on a timely
basis to each Holder any Internal Revenue Service form required to be so
provided in respect of the Trust Securities.
ARTICLE V
TRUST SECURITIES CERTIFICATES
Section 5.01 Initial Ownership. Upon the formation of the Trust by the
-----------------
contribution by the Depositor pursuant to Section 2.03 and until the issuance of
the Trust Securities, and at any time during which no Trust Securities are
outstanding, the Depositor shall be the sole beneficial owner of the Trust.
Section 5.02 The Trust Securities Certificates. Each of the Preferred and
---------------------------------
Common Securities Certificates shall be issued in minimum denominations of $25
and integral multiples in excess thereof. The Trust Securities Certificates
shall be executed on behalf of the Trust by manual or facsimile signature of at
least one Administrative Trustee. Trust Securities Certificates bearing the
manual or facsimile signatures of individuals who were, at the time when such
signatures shall have been affixed, authorized to sign on behalf of the Trust,
shall be validly issued and entitled to the benefits of this Trust Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so
authorized prior to the authentication and delivery of such Trust Securities
Certificates or did not hold such offices at the date of authentication and
delivery of such Trust Securities Certificates. A transferee of a Trust
Securities Certificate shall become a Securityholder, and shall be entitled to
the rights and subject to the obligations of a Securityholder hereunder, upon
due registration of such Trust Securities Certificate in such transferee's name
pursuant to Section 5.04.
Section 5.03 Authentication of Trust Securities Certificates. On the
-----------------------------------------------
Issue Date, the Administrative Trustees shall cause Trust Securities
Certificates, in an aggregate Liquidation Amount as provided in Sections 2.04
and 2.05, to be executed on behalf of the Trust, authenticated and delivered to
or upon the written order of the Depositor signed by its Chairman of the Board,
its President or any Vice President, without further corporate action by the
Depositor, in authorized denominations. No Trust Securities Certificate shall
entitle its Holder to any benefit under this Trust Agreement, or shall be valid
for any purpose, unless there shall appear on such Trust Securities Certificate
a certificate of authentication substantially in the form set forth in Exhibit E
or Exhibit C, as applicable, executed by at least one Administrative Trustee by
manual signature; such authentication shall constitute conclusive evidence that
such Trust Securities Certificate shall have been duly authenticated and
delivered hereunder. All Trust Securities Certificates shall be dated the date
of their authentication.
Section 5.04 Registration of Transfer and Exchange of Preferred Securities
-------------------------------------------------------------
Certificates. The Security Registrar shall keep or cause to be kept, at the
------------
office or agency maintained pursuant to Section 5.08, a Security Register in
which, subject to such reasonable regulations as it may prescribe, the Security
Registrar shall provide for the registration of Preferred Securities
Certificates and the Common Securities Certificates (subject to Section 5.10 in
the case of the Common Securities Certificates) and registration of transfers
and exchanges of Preferred Securities Certificates as herein provided. The
Property Trustee shall be the initial Security Registrar.
20
Upon surrender for registration of transfer of any Preferred Securities
Certificate at the office or agency maintained pursuant to Section 5.08, the
Administrative Trustees shall execute, authenticate and deliver in the name of
the designated transferee or transferees, one or more new Preferred Securities
Certificates in authorized denominations of a like aggregate Liquidation Amount
dated the date of authentication by the Administrative Trustee or Trustees. The
Security Registrar shall not be required to register the transfer of any
Preferred Securities that have been called for redemption. At the option of a
Holder, Preferred Securities Certificates may be exchanged for other Preferred
Securities Certificates in authorized denominations of the same class and of a
like aggregate Liquidation Amount upon surrender of the Preferred Securities
Certificates to be exchanged at the office or agency maintained pursuant to
Section 5.08.
Every Preferred Securities Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Administrative Trustees and
the Security Registrar duly executed by the Holder or such Holder's attorney
duly authorized in writing. Each Preferred Securities Certificate surrendered
for registration of transfer or exchange shall be cancelled and subsequently
disposed of by the Security Registrar in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Security Registrar or the
Administrative Trustees may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any transfer or
exchange of Preferred Securities Certificates.
Section 5.05 Mutilated, Destroyed, Lost or Stolen Trust Securities
-----------------------------------------------------
Certificates. If (a) any mutilated Trust Securities Certificate shall be
------------
surrendered to the Security Registrar, or if the Security Registrar shall
receive evidence to its satisfaction of the destruction, loss or theft of any
Trust Securities Certificate and (b) there shall be delivered to the Security
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees or any one of them on behalf of the Trust
shall execute and authenticate and make available for delivery, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Trust Securities
Certificate, a new Trust Securities Certificate of like class, tenor and
denomination. In connection with the issuance of any new Trust Securities
Certificate under this Section, the Administrative Trustees or the Security
Registrar may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith. Any duplicate
Trust Securities Certificate issued pursuant to this Section shall constitute
conclusive evidence of an ownership interest in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
Section 5.06 Persons Deemed Securityholders. Prior to due presentation of
------------------------------
a Trust Securities Certificate for registration of transfer, the Trustees or the
Security Registrar shall treat the Person in whose name any Trust Securities
Certificate shall be registered in the Security Register as the owner of such
Trust Securities Certificate for the purpose of receiving Distributions (subject
to Section 4.01(d)) and for all other purposes whatsoever, and neither the
Trustees nor the Security Registrar shall be bound by any notice to the
contrary.
Section 5.07 Access to List of Securityholders' Names and Addresses. The
------------------------------------------------------
Administrative Trustees shall furnish or cause to be furnished to (i) the
Depositor and the
21
Property Trustee semi-annually, not later than June 1 and December 1 in each
year and (ii) the Depositor or the Property Trustee, as the case may be, within
30 days after receipt by any Administrative Trustee of a request therefor from
the Depositor or the Property Trustee, as the case may be, in writing, a list,
in such form as the Depositor or the Property Trustee, as the case may be, may
reasonably require, of the names and addresses of the Securityholders as of a
date not more than 15 days prior to the time such list is furnished; provided
--------
that the Administrative Trustees shall not be obligated to provide such list at
----
any time such list does not differ from the most recent list given to the
Depositor and the Property Trustee by the Administrative Trustees or at any time
the Property Trustee is the Security Registrar. If three or more
Securityholders or one or more Holders of Trust Securities Certificates
evidencing not less than 25% of the outstanding Liquidation Amount apply in
writing to the Administrative Trustees, and such application states that the
applicants desire to communicate with other Securityholders with respect to
their rights under this Trust Agreement or under the Trust Securities
Certificates and such application is accompanied by a copy of the communication
that such applicants propose to transmit, then the Administrative Trustees
shall, within five Business Days after the receipt of such application, afford
such applicants access during normal business hours to the current list of
Securityholders. Each Holder, by receiving and holding a Trust Securities
Certificate, shall be deemed to have agreed not to hold either the Depositor or
the Administrative Trustees accountable by reason of the disclosure of its name
and address, regardless of the source from which such information was derived.
Section 5.08 Maintenance of Office or Agency. The Administrative Trustees
-------------------------------
shall maintain in the Borough of Manhattan, New York, an office or offices or
agency or agencies where Preferred Securities Certificates may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Trustees in respect of the Trust Securities Certificates may be served.
The Administrative Trustees initially designate The Chase Manhattan Bank, ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as the principal agency for such
purposes. The Administrative Trustees shall give prompt written notice to the
Depositor and to the Securityholders of any change in the location of the
Security Register or any such office or agency.
Section 5.09 Appointment of Paying Agent. The Paying Agent shall make
---------------------------
Distributions and other payments provided hereby to Securityholders from the
Payment Account and shall report the amounts of such Distributions and payments
to the Property Trustee and the Administrative Trustees. Any Paying Agent shall
have the revocable power to withdraw funds from the Payment Account for the
purpose of making the Distributions and payments provided hereby. The
Administrative Trustees may revoke such power and remove the Paying Agent if
such Trustees determine in their sole discretion that the Paying Agent shall
have failed to perform its obligations under this Trust Agreement in any
material respect. The Paying Agent shall initially be the Property Trustee, and
it may choose any co-paying agent that is acceptable to the Administrative
Trustees and the Depositor. Any Person acting as Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' written notice to the
Administrative Trustees and the Depositor. In the event that a Paying Agent
shall resign or be removed, the Administrative Trustees shall appoint a
successor that is acceptable to the Depositor to act as Paying Agent (which
shall be a bank or trust company). The Administrative Trustees shall cause such
successor Paying Agent or any additional Paying Agent appointed by the
Administrative Trustees to execute and deliver to the Trustees an instrument in
which such successor Paying Agent or additional Paying Agent shall agree with
the Trustees that as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for
22
payment to the Securityholders in trust for the benefit of the Securityholders
entitled thereto until such sums shall be paid to such Securityholders. The
Paying Agent shall return all unclaimed funds to the Property Trustee and upon
removal of a Paying Agent such Paying Agent shall also return all funds in its
possession to the Property Trustee. The provisions of Sections 8.01, 8.03 and
8.06 shall apply to the Property Trustee also in its role as Paying Agent, for
so long as the Property Trustee shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in
this Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
Section 5.10 Ownership of Common Securities by Depositor. On the Issue
-------------------------------------------
Date, the Depositor shall acquire, and thereafter retain, beneficial and record
ownership of the Common Securities. Any attempted transfer of the Common
Securities, except for transfers by operation of law or to an Affiliate of the
Depositor or a permitted successor under Section 801 of the Subordinated
Indenture, shall be void. The Administrative Trustees shall cause each Common
Securities Certificate issued to the Depositor and its permitted transferees to
contain a legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS
PROVIDED IN THE TRUST AGREEMENT REFERRED TO HEREIN".
Section 5.11 Book-Entry Preferred Securities Certificates; Common
----------------------------------------------------
Securities Certificate.
----------------------
(a) The Preferred Securities Certificates, upon original issuance, will be
issued in the form of a typewritten Preferred Securities Certificate or
Certificates representing Book-Entry Preferred Securities Certificates, to be
delivered to The Depository Trust Company, the initial Clearing Agency, by, or
on behalf of, the Trust. Such Preferred Securities Certificate or Certificates
shall initially be registered on the Security Register in the name of Cede &
Co., the nominee of the initial Clearing Agency, and no Owner will receive a
definitive Preferred Securities Certificate representing such beneficial owner's
interest in such Preferred Securities, except as provided in Section 5.13.
Unless and until Definitive Preferred Securities Certificates have been issued
to Owners pursuant to Section 5.13:
(i) the provisions of this Section 5.11(a) shall be in full force
and effect;
(ii) the Security Registrar and the Trustees shall be entitled to
deal with the Clearing Agency for all purposes of this Trust Agreement
relating to the Book-Entry Preferred Securities Certificates (including the
payment of principal of and interest on the Book-Entry Preferred Securities
and the giving of instructions or directions to Owners of Book-Entry
Preferred Securities) as the sole Holder of Book-Entry Preferred Securities
and shall have no obligations to the Owners thereof;
(iii) to the extent that the provisions of this Section conflict
with any other provisions of this Trust Agreement, the provisions of this
Section shall control;
(iv) the rights of the Owners of the Book-Entry Preferred
Securities Certificates shall be exercised only through the Clearing Agency
and shall be limited to those established by law and agreements between
such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Certificate Depository Agreement, unless and
until Definitive Preferred Securities Certificates are issued pursuant to
Section 5.13, the Clearing Agency will make book-entry transfers among the
23
Clearing Agency Participants and receive and transmit payments on the
Preferred Securities to such Clearing Agency Participants; and
(v) whenever this Trust Agreement requires or permits actions to
be taken based upon instructions or directions of Holders of Trust
Securities Certificates evidencing a specified percentage of the aggregate
Liquidation Amount, the Clearing Agency shall be deemed to represent such
percentage only to the extent that it has received instructions to such
effect from Owners and/or Clearing Agency Participants owning or
representing, respectively, such required percentage of the beneficial
interest in the applicable class of Trust Securities Certificates and has
delivered such instructions to the Trustees.
(b) A single Common Securities Certificate representing the Common
Securities shall be issued to the Depositor in the form of a definitive Common
Securities Certificate.
Section 5.12 Notices to Clearing Agency. To the extent a notice or other
--------------------------
communication to the Owners is required under this Trust Agreement, unless and
until Definitive Preferred Securities Certificates shall have been issued to
Owners pursuant to Section 5.13, the Trustees shall give all such notices and
communications specified herein to be given to Owners to the Clearing Agency,
and shall have no obligations to the Owners.
Section 5.13 Definitive Preferred Securities Certificates. If (i) the
--------------------------------------------
Depositor advises the Trustees in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities with respect to the
Preferred Securities Certificates, and the Depositor is unable to locate a
qualified successor within 90 days of receipt by the Depositor of such written
advice, or (ii) the Depositor at its option advises the Trustees in writing that
it elects to terminate the book-entry system through the Clearing Agency, then
the Administrative Trustees shall notify the Clearing Agency and Holders of the
Preferred Securities. Upon surrender to the Administrative Trustees of the
typewritten Preferred Securities Certificate or Certificates representing the
Book-Entry Preferred Securities Certificates by the Clearing Agency, accompanied
by registration instructions, the Administrative Trustees or any one of them
shall execute and authenticate the Definitive Preferred Securities Certificates
in accordance with the instructions of the Clearing Agency. Neither the Security
Registrar nor the Trustees shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be protected in relying on,
such instructions. Upon the issuance of Definitive Preferred Securities
Certificates, the Trustees shall recognize the Holders of the Definitive
Preferred Securities Certificates as Securityholders. The Definitive Preferred
Securities Certificates shall be printed, lithographed or engraved or may be
produced in any other manner as is reasonably acceptable to the Administrative
Trustees, as evidenced by the execution thereof by the Administrative Trustees
or any one of them.
Section 5.14 Rights of Securityholders. The legal title to the Trust
-------------------------
Property is vested exclusively in the Property Trustee (in its capacity as such)
in accordance with Section 2.09, and the Securityholders shall not have any
right or title therein other than the undivided beneficial ownership interest in
the assets of the Trust conferred by their Trust Securities, and they shall have
no right to call for any partition or division of property, profits or rights of
the Trust except as described below. The Trust Securities shall be personal
property giving only the rights specifically set forth therein and in this Trust
Agreement. The Trust Securities shall have no preemptive or other similar
rights and when issued and delivered to Securityholders against payment of the
purchase price therefor will be fully paid and nonassessable by the Trust.
Except
24
as otherwise provided in the Expense Agreement and Section 10.01 hereof with
respect to the Depositor, the Holders of the Trust 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.
ARTICLE VI
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
Section 6.01 Limitations on Voting Rights.
----------------------------
(a) Except as provided in this Section, in Section 8.10 or Section 10.03 of
this Trust Agreement, in the Subordinated Indenture, and as otherwise required
by law, no Holder of Preferred Securities shall have any right to vote or in any
manner otherwise control the administration, operation and management of the
Trust or the obligations of the parties hereto, nor shall anything herein set
forth, or contained in the terms of the Trust Securities Certificates, be
construed so as to constitute the Securityholders from time to time as partners
or members of an association.
(b) So long as any Junior Subordinated Notes are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Indenture Trustee, or
executing any trust or power conferred on the Indenture Trustee with respect to
such Junior Subordinated Notes, (ii) consent to waive any past default which is
waivable under Section 513 of the Subordinated Indenture, (iii) exercise any
right to rescind or annul a declaration that the principal of all the Junior
Subordinated Notes shall be due and payable or (iv) consent to any amendment,
modification or termination of the Subordinated Indenture or the Junior
Subordinated Notes, where such consent shall be required, or to any other
action, as holder of the Junior Subordinated Notes, under the Subordinated
Indenture, without, in each case, obtaining the prior approval of the Holders of
at least 66-2/3% in Liquidation Amount of the Outstanding Preferred Securities;
provided, however, that where a consent under the Subordinated Indenture would
-------- -------
require the consent of each holder of Junior Subordinated Notes affected
thereby, no such consent shall be given by the Trustees without the prior
written consent of each Holder of Preferred Securities. The Trustees shall not
revoke any action previously authorized or approved by a vote of the Holders of
Preferred Securities, except pursuant to a subsequent vote of the Holders of
Preferred Securities. The Property Trustee shall notify all Holders of the
Preferred Securities of any notice of default received from the Indenture
Trustee with respect to the Junior Subordinated Notes.
(c) If any proposed amendment to the Trust Agreement provides for, or the
Trustees otherwise propose to effect, (i) any action that would adversely affect
the powers, preferences or special rights of the Preferred Securities, whether
by way of amendment to this Trust Agreement or otherwise, or (ii) the
dissolution, winding-up or termination of the Trust, other than pursuant to the
terms of this Trust Agreement, then the Holders of Outstanding Preferred
Securities as a class will be entitled to vote on such amendment or proposal and
such amendment or proposal shall not be effective except with the approval of
the Holders of at least 66-2/3% in Liquidation Amount of the Outstanding
Preferred Securities.
25
Section 6.02 Notice of Meetings. Notice of all meetings of the Preferred
------------------
Securityholders, stating the time, place and purpose of the meeting, shall be
given by the Administrative Trustees pursuant to Section 10.08 to each Preferred
Securityholder of record, at his registered address, at least 15 days and not
more than 90 days before the meeting. At any such meeting, any business
properly before the meeting may be so considered whether or not stated in the
notice of the meeting. Any adjourned meeting may be held as adjourned without
further notice. Any and all notice to which any Preferred Securityholder
hereunder may be entitled and any and all communications shall be deemed duly
served or given if mailed, postage prepaid, addressed to any Preferred
Securityholders of record at his last known address as recorded on the Security
Register.
Section 6.03 Meetings of Preferred Securityholders. No annual meeting of
-------------------------------------
Securityholders is required to be held. The Administrative Trustees, however,
shall call a meeting of Securityholders to vote on any matter upon the written
request of the Preferred Securityholders of record of 25% of the Preferred
Securities (based upon their Liquidation Amount) and the Administrative Trustees
or the Property Trustee may, at any time in their discretion, call a meeting of
Preferred Securityholders to vote on any matters as to which Preferred
Securityholders are entitled to vote.
Preferred Securityholders of record of 50% of the Preferred Securities
(based upon their Liquidation Amount), present in person or by proxy, shall
constitute a quorum at any meeting of Securityholders.
If a quorum is present at a meeting, an affirmative vote by the Preferred
Securityholders of record present, in person or by proxy, holding more than 66-
2/3% of the Preferred Securities (based upon their Liquidation Amount) held by
the Preferred Securityholders of record present, either in person or by proxy,
at such meeting shall constitute the action of the Securityholders, unless this
Trust Agreement requires a greater proportion of affirmative votes.
Section 6.04 Voting Rights. Securityholders shall be entitled to one vote
-------------
for each $25 of Liquidation Amount represented by their Trust Securities in
respect of any matter as to which such Securityholders are entitled to vote.
Section 6.05 Proxies, etc. At any meeting of Securityholders, any
-------------
Securityholder entitled to vote may vote by proxy, provided that no proxy shall
be voted at any meeting unless it shall have been placed on file with the
Administrative Trustees, or with such other officer or agent of the Trust as the
Administrative Trustees may direct, for verification prior to the time at which
such vote shall be taken. Pursuant to a resolution of the Property Trustee,
proxies may be solicited in the name of the Property Trustee or one or more
officers of the Property Trustee. Only Securityholders of record shall be
entitled to vote. When Trust Securities are held jointly by several Persons,
any one of them may vote at any meeting in person or by proxy in respect of such
Trust Securities, but if more than one of them shall be present at such meeting
in person or by proxy, and such joint owners or their proxies so present
disagree as to any vote to be cast, such vote shall not be received in respect
of such Trust Securities. A proxy purporting to be executed by or on behalf of
a Securityholder shall be deemed valid unless challenged at or prior to its
exercise, and the burden of proving invalidity shall rest on the challenger. No
proxy shall be valid more than three years after its date of execution.
26
Section 6.06 Securityholder Action by Written Consent. Any action which
----------------------------------------
may be taken by Securityholders at a meeting may be taken without a meeting if
Securityholders holding at least 66-2/3% of all outstanding Trust Securities
entitled to vote in respect of such action (or such other proportion thereof as
shall be required by any express provision of this Trust Agreement) shall
consent to the action in writing (based upon their Liquidation Amount).
Section 6.07 Record Date for Voting and Other Purposes. For the purposes
-----------------------------------------
of determining the Securityholders who are entitled to notice of and to vote at
any meeting or by written consent, or to participate in any Distribution on the
Trust Securities in respect of which a record date is not otherwise provided for
in this Trust Agreement, or for the purpose of any other action, the
Administrative Trustees may from time to time fix a date, not more than 90 days
prior to the date of any meeting of Securityholders or the payment of
distribution or other action, as the case may be, as a record date for the
determination of the identity of the Securityholders of record for such
purposes.
Section 6.08 Acts of Securityholders. Any request, demand, authorization,
-----------------------
direction, notice, consent, waiver or other action provided or permitted by this
Trust Agreement to be given, made or taken by Securityholders may be embodied in
and evidenced by one or more instruments of substantially similar tenor signed
by such Securityholders in person or by an agent appointed in writing; and,
except as otherwise expressly provided herein, such action shall become
effective when such instrument or instruments are delivered to the
Administrative Trustees. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Securityholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Trust Agreement and (subject to Section
8.01) conclusive in favor of the Trustees, if made in the manner provided in
this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgements of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustees deem sufficient.
The ownership of Preferred Securities shall be proved by the Security
Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to take
any action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or by
one or more duly appointed agents each
27
of which may do so pursuant to such appointment with regard to all or any part
of such Liquidation Amount.
If any dispute shall arise between the Holders of Trust Securities and the
Administrative Trustees or among such Securityholders or Trustees with respect
to the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder or
Trustee under this Article VI, then the determination of such matter by the
Property Trustee shall be conclusive with respect to such matter.
Section 6.09 Inspection of Records. Upon reasonable notice to the
---------------------
Trustees, the records of the Trust shall be open to inspection by
Securityholders during normal business hours for any purpose reasonably related
to such Securityholder's interest as a Securityholder.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF THE PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
Section 7.01 Representations and Warranties of the Property Trustee and
----------------------------------------------------------
Delaware Trustee. The Bank, the Delaware Bank, the Property Trustee and the
----------------
Delaware Trustee, each on behalf of and as to itself, hereby represents and
warrants for the benefit of the Depositor and the Securityholders that:
(a) the Bank is a banking corporation or trust company duly organized,
validly existing and in good standing under the laws of the State of New York,
and the Delaware Trustee is a banking corporation or trust company duly
organized, validly existing and in good standing under the laws of the State of
Delaware;
(b) each of the Bank and the Delaware Bank has full corporate power,
authority and legal right to execute, deliver and perform their obligations
under this Trust Agreement and has taken all necessary action to authorize the
execution, delivery and performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed and delivered
by each of the Bank and the Delaware Bank and constitutes the valid and legally
binding agreement of each of the Bank and the Delaware Bank, enforceable against
it in accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles;
(d) the execution, delivery and performance by each of the Bank and the
Delaware Bank of this Trust Agreement have been duly authorized by all necessary
corporate action on the part of the Bank, Property Trustee, the Delaware Bank
and the Delaware Trustee and do not require any approval of stockholders of the
Bank or the Delaware Bank and such execution, delivery and performance will not
(i) violate the Bank's or the Delaware Bank's charter or by-laws, or (ii)
violate any law, governmental rule or regulation of the United States or the
State of New York or Delaware, as the case may be, governing the banking or
trust powers of the Bank and the Property Trustee or the Delaware Bank and the
Delaware Trustee, or any order,
28
judgment or decree applicable to the Bank, the Property Trustee, the Delaware
Bank or the Delaware Trustee; and
(e) neither the authorization, execution or delivery by the Bank or the
Delaware Bank of this Trust Agreement, nor the consummation of any of the
transactions by the Bank, the Property Trustee, the Delaware Bank or the
Delaware Trustee (as appropriate in context) contemplated herein or therein, nor
the issuance of the Trust Securities Certificates pursuant to this Trust
Agreement require the consent or approval of, the giving of notice to, the
registration with or the taking of any other action with respect to any
governmental authority or agency under any existing federal, New York or
Delaware law governing the banking or trust powers of the Bank or the Delaware
Bank.
ARTICLE VIII
THE TRUSTEES
Section 8.01 Certain Duties and Responsibilities.
-----------------------------------
(a) The rights, duties and responsibilities of the Trustees shall be as
provided by this Trust Agreement and the Delaware Business Trust Act (except
that the immunities and standard of care of the Property Trustee shall be
governed by New York law) and, in the case of the Property Trustee, the
Trust Indenture Act. Notwithstanding the foregoing, no provision of this Trust
Agreement shall require the Trustees to expend or risk their own funds or
otherwise incur any financial liability in the performance of any of their
duties hereunder, or in the exercise of any of their rights or powers, if they
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
them. Whether or not therein expressly so provided, every provision of this
Trust Agreement relating to the conduct or affecting the liability of or
affording protection to the Trustees shall be subject to the provisions of this
Section.
(b) All payments made by the Property Trustee in respect of the Trust
Securities shall be made only from the income and proceeds from the Trust
Property and only to the extent that there shall be sufficient income or
proceeds from the Trust Property to enable the Property Trustee to make payments
in accordance with the terms hereof. Each Securityholder, by its acceptance of
a Trust Security, agrees that it will look solely to the income and proceeds
from the Trust Property to the extent available for distribution to it as herein
provided and that the Trustees are not personally liable to it for any amount
distributable in respect of any Trust Security or for any other liability in
respect of any Trust Security. This Section 8.01(b) does not limit the
liability of the Trustees expressly set forth elsewhere in this Trust Agreement
or, in the case of the Property Trustee, in the Trust Indenture Act.
Section 8.02 Notice of Defaults. Within 90 days after the occurrence of
------------------
any default, the Property Trustee shall transmit, in the manner and to the
extent provided in Section 10.08, notice of any such default known to the
Property Trustee to the Securityholders, the Administrative Trustees and the
Depositor, unless such default shall have been cured or waived. For the purpose
of this Section, the term "default" means any event which is, or after notice or
lapse of time or both would become, an Event of Default.
29
Section 8.03 Certain Rights of Property Trustee. Subject to the
----------------------------------
provisions of Section 8.01 and except as provided by law:
(i) the Property Trustee may rely and shall be protected in acting or
refraining from acting in good faith upon any resolution, Opinion of
Counsel, certificate, written representation of a Holder or
transferee, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent,
order, appraisal, bond or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or
parties;
(ii) if (A) in performing its duties under this Trust Agreement the
Property Trustee is required to decide between alternative courses of
action, or (B) in construing any of the provisions in this Trust
Agreement the Property Trustee finds the same ambiguous or
inconsistent with any other provisions contained herein, or (C) the
Property Trustee is unsure of the application of any provision of this
Trust Agreement, then, except as to any matter as to which the
Preferred Securityholders are entitled to vote under the terms of this
Trust Agreement, the Property Trustee shall deliver a notice to the
Depositor requesting written instructions of the Depositor as to the
course of action to be taken. The Property Trustee shall take such
action, or refrain from taking such action, as the Property Trustee
shall be instructed in writing to take, or to refrain from taking, by
the Depositor; provided, however, that if the Property Trustee does
-------- -------
not receive such instructions of the Depositor within ten Business
Days after it has delivered such notice, or such reasonably shorter
period of time set forth in such notice (which to the extent
practicable shall not be less than two Business Days), it may, but
shall be under no duty to, take or refrain from taking such action not
inconsistent with this Trust Agreement as it shall deem advisable and
in the best interests of the Securityholders, in which event the
Property Trustee shall have no liability except for its own bad faith,
negligence or willful misconduct;
(iii) the Property Trustee may consult with counsel of its selection
and the written advice of such counsel or any Opinion of 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;
(iv) the Property Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Trust Agreement at the
request or direction of any of the Securityholders pursuant to this
Trust Agreement, unless such Securityholders shall have offered to the
Property Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(v) the Property Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, approval, bond or other document, unless requested in writing
to do so by one or more Securityholders; and
(vi) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through its agents or
30
attorneys, provided that the Property Trustee shall be responsible for
its own negligence or recklessness with respect to selection of any
agent or attorney appointed by it hereunder.
Section 8.04 Not Responsible for Recitals or Issuance of Securities.
------------------------------------------------------
The recitals contained herein and in the Trust Securities Certificates shall be
taken as the statements of the Trust, and the Trustees do not assume any
responsibility for their correctness. The Trustees shall not be accountable for
the use or application by the Trust of the proceeds of the Trust Securities in
accordance with Section 2.05.
The Property Trustee may conclusively assume that any funds held by it
hereunder are legally available unless an officer of the Property Trustee
assigned to its Corporate Trustee Administrative Department shall have received
written notice from the Corporation, any Holder or any other Trustee that such
funds are not legally available.
Section 8.05 May Hold Securities. Except as provided in the definition
-------------------
of the term "Outstanding" in Article I, any Trustee or any other agent of the
Trustees or the Trust, in its individual or any other capacity, may become the
owner or pledgee of Trust Securities and may otherwise deal with the Trust with
the same rights it would have if it were not a Trustee or such other agent.
Section 8.06 Compensation; Fees; Indemnity.
-----------------------------
The Depositor agrees:
(1) to pay to the Trustees from time to time reasonable compensation for
all services rendered by the Trustees hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustees in accordance with any provision of this Trust
Agreement (including the reasonable compensation and the expenses and
disbursements of their agents and counsel), except any such expense,
disbursement or advance as may be attributable to their negligence, willful
misconduct or bad faith; and
(3) to indemnify the Trustees for, and to hold the Trustees harmless
against, any and all loss, damage, claims, liability or expense incurred without
negligence, willful misconduct or bad faith on their part, arising out of or in
connection with the acceptance or administration of this Trust Agreement,
including the costs and expenses of defending themselves against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder.
The provisions of this Section 8.06 shall survive the termination of
this Trust Agreement.
Section 8.07 Trustees Required; Eligibility.
------------------------------
(a) There shall at all times be a Property Trustee hereunder with
respect to the Trust Securities. The Property Trustee shall be a Person that
has a combined capital and surplus of at
31
least $50,000,000. If any such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of its supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Property Trustee with respect to the Trust Securities shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
(b) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized to bind such
entity.
(c) There shall at all times be a Delaware Trustee with respect to the
Trust Securities. The Delaware Trustee shall either be (i) a natural person who
is at least 21 years of age and a resident of the State of Delaware or (ii) a
legal entity authorized to conduct a trust business and with its principal place
of business in the State of Delaware that shall act through one or more persons
authorized to bind such entity.
Section 8.08 Conflicting Interests.
---------------------
If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement. To the extent permitted by the Trust Indenture Act, the Property
Trustee shall not be deemed to have a conflicting interest by virtue of being
trustee under the Guarantee.
Section 8.09 Co-Property Trustees and Separate Trustee.
-----------------------------------------
At any time or times, for the purpose of meeting the legal requirements
of the Trust Indenture Act or of any jurisdiction in which any part of the Trust
Property may at the time be located, the Holder of the Common Securities and the
Property Trustee shall have power to appoint, and upon the written request of
the Property Trustee, the Depositor shall for such purpose join with the
Property Trustee in the execution, delivery and performance of all instruments
and agreements necessary or proper to appoint, one or more Persons approved by
the Property Trustee either to act as co-property trustee, jointly with the
Property Trustee, of all or any part of such Trust Property, or to act as
separate trustee of any such Trust Property, in either case with such powers as
may be provided in the instrument of appointment, and to vest in such Person or
Persons in the capacity aforesaid, any property, title, right or power deemed
necessary or desirable, subject to the other provisions of this Section. If the
Depositor does not join in such appointment within 15 days after the receipt by
it of a request so to do, or in case an Indenture Event of Default has occurred
and is continuing, the Property Trustee alone shall have power to make such
appointment. Any co-property trustee or separate trustee appointed pursuant to
this Section shall satisfy the requirements of Section 8.07.
Should any written instrument from the Depositor be required by any co-
property trustee or separate trustee so appointed for more fully confirming to
such co-property trustee or separate
32
trustee such property, title, right, or power, any and all such instruments
shall, on request, be executed, acknowledged, and delivered by the Depositor.
Every co-property trustee or separate trustee shall, to the extent
permitted by law, but to such extent only, be appointed subject to the following
terms, namely:
(i) The Trust Securities shall be executed, authenticated and
delivered and all rights, powers, duties, and obligations hereunder in
respect of the custody of securities, cash and other personal property held
by, or required to be deposited or pledged with, the Trustees hereunder,
shall be exercised, solely by the Trustees.
(ii) The rights, powers, duties, and obligations hereby conferred
or imposed upon the Property Trustee in respect of any property covered by
such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-
property trustee or separate trustee jointly, as shall be provided in the
instrument appointing such co-property trustee or separate trustee, except
to the extent that under any law of any jurisdiction in which any
particular act is to be performed, the Property Trustee shall be
incompetent or unqualified to perform such act, in which event such rights,
powers, duties, and obligations shall be exercised and performed by such
co-property trustee or separate trustee.
(iii) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Depositor, may
accept the resignation of or remove any co-property trustee or separate
trustee appointed under this Section, and, in case an Indenture Event of
Default has occurred and is continuing, the Property Trustee shall have
power to accept the resignation of, or remove, any such co-property trustee
or separate trustee without the concurrence of the Depositor. Upon the
written request of the Property Trustee, the Depositor shall join with the
Property Trustee in the execution, delivery, and performance of all
instruments and agreements necessary or proper to effectuate such
resignation or removal. A successor to any co-property trustee or separate
trustee so resigned or removed may be appointed in the manner provided in
this Section.
(iv) No co-property trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee,
or any other such trustee hereunder.
(v) The Trustees shall not be liable by reason of any act of a co-
property trustee or separate trustee.
(vi) Any Act of Holders delivered to the Property Trustee shall be
deemed to have been delivered to each such co-property trustee and separate
trustee.
Section 8.10 Resignation and Removal; Appointment of Successor.
-------------------------------------------------
No resignation or removal of any Trustee (the "Relevant Trustee") and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 8.11.
Subject to the immediately preceding paragraph, the Relevant Trustee may
resign at any time by giving written notice thereof to the Holders. If the
instrument of acceptance by the successor Trustee required by Section 8.11
shall not have been delivered to the Relevant Trustee within 30 days after the
giving of such notice of resignation, the resigning Relevant Trustee may
petition, at the expense of the Trust, any court of competent jurisdiction for
the appointment of a successor Relevant Trustee.
33
Unless an Indenture Event of Default shall have occurred and be continuing,
any Trustee may be removed at any time by Act of the Holder of the Common
Securities. If an Indenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority in Liquidation
Amount of the Preferred Securities, delivered to the Relevant Trustee (in its
individual capacity and on behalf of the Trust). An Administrative Trustee may
be removed by the Holder of the Common Securities at any time. In no event will
the Holders of the Preferred Securities have a right to vote to appoint, remove
or replace the Administrative Trustees.
If any Trustee shall resign, be removed or become incapable of continuing to
act as Trustee, or if a vacancy shall occur in the office of any Trustee for any
reason, at a time when no Indenture Event of Default shall have occurred and be
continuing, the Holder of the Common Securities, by Act of the Holder of the
Common Securities, shall promptly appoint a successor Trustee or successor
Trustees, and the retiring Trustee shall comply with the applicable requirements
of Section 8.11. If the Property Trustee or the Delaware Trustee shall resign,
be removed or become incapable of continuing to act as the Property Trustee or
the Delaware Trustee, as the case may be, or a vacancy shall occur in the office
of any such Trustee for any reason, at a time when an Indenture Event of Default
shall have occurred and be continuing, the Holders of Preferred Securities, by
Act of the Holders of a majority in Liquidation Amount of the Preferred
Securities then Outstanding, shall promptly appoint a successor Relevant Trustee
or Relevant Trustees and such successor Relevant Trustee or Relevant Trustees
shall comply with the applicable requirements of Section 8.11. If an
Administrative Trustee shall resign, be removed or become incapable of acting as
Administrative Trustee, or a vacancy shall occur in the office of any such
Trustee for any reason, at a time when an Indenture Event of Default shall have
occurred and be continuing, the Holder of the Common Securities, by Act of the
Holder of the Common Securities, shall promptly appoint a successor
Administrative Trustee or Administrative Trustees and such successor
Administrative Trustee or Administrative Trustees shall comply with the
applicable requirements of Section 8.11. If no successor Relevant Trustee shall
have been so appointed in accordance with this Section 8.10 and accepted
appointment in the manner required by Section 8.11, any Holder who has been a
Holder of Trust Securities for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Relevant Trustee.
The Property Trustee shall give notice of each resignation and each removal of
a Trustee and each appointment of a successor Trustee to all Holders in the
manner provided in Section 10.08 and shall give notice to the Depositor. Each
notice shall include the name of the successor Relevant Trustee and the address
of its Corporate Trust Office if it is the Property Trustee.
Notwithstanding the foregoing or any other provision of this Trust Agreement,
in the event any Administrative Trustee or a Delaware Trustee who is a natural
person dies or becomes, in the opinion of the Depositor, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity may
be filled by (i) the act of the remaining Administrative Trustee or (ii)
otherwise by the Depositor (with the successor in each case being a Person who
satisfies the eligibility requirements for an Administrative Trustee or a
Delaware Trustee, as the case may be, set forth in Section 8.07).
34
Section 8.11 Acceptance of Appointment by Successor. In case of the
--------------------------------------
appointment hereunder of a successor Relevant Trustee, every such successor
Relevant Trustee so appointed shall execute, acknowledge and deliver to the
Trust and to the retiring Relevant Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Relevant
Trustee shall become effective and such successor Relevant Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Relevant Trustee; but, on the request
of the Depositor or the successor Relevant Trustee, such retiring Relevant
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Relevant Trustee all the rights, powers and
trusts of the retiring Relevant Trustee and shall duly assign, transfer and
deliver to such successor Relevant Trustee all property and money held by such
retiring Relevant Trustee hereunder.
Upon request of any such successor Relevant Trustee, the Trust shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Relevant Trustee all such rights, powers and trusts
referred to in the preceding paragraph.
No successor Relevant Trustee shall accept its appointment unless at the
time of such acceptance such successor Relevant Trustee shall be qualified and
eligible under this Article.
Section 8.12 Merger, Conversion, Consolidation or Succession to Business.
-----------------------------------------------------------
Any Person into which the Property Trustee, Delaware Trustee or any
Administrative Trustee which is not a natural person may be merged or converted
or with which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which such Relevant Trustee shall be a party, or
any Person succeeding to all or substantially all the corporate trust business
of such Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder, provided such Person shall be otherwise qualified and eligible,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.
Section 8.13 Preferential Collection of Claims Against Depositor or Trust.
------------------------------------------------------------
If and when the Property Trustee shall be or become a creditor of the Depositor
or the Trust (or any other obligor upon the Junior Subordinated Notes or the
Trust Securities), the Property Trustee shall be subject to the provisions of
the Trust Indenture Act regarding the collection of claims against the Depositor
or Trust (or any such other obligor). For purposes of Section 311(b)(4) and (6)
of the Trust Indenture Act:
(a) "cash transaction" means any transaction in which full payment for
goods or securities sold is made within seven days after delivery of the goods
or securities in currency or in checks or other orders drawn upon banks or
bankers and payable upon demand; and
(b) "self-liquidating paper" means any draft, ▇▇▇▇ of exchange, acceptance
or obligation which is made, drawn, negotiated or incurred by the Depositor or
the Trust (or any such obligor) for the purpose of financing the purchase,
processing, manufacturing, shipment, storage or sale of goods, wares or
merchandise and which is secured by documents evidencing title to, possession
of, or a lien upon, the goods, wares or merchandise or the receivables or
proceeds arising from the sale of the goods, wares or merchandise previously
constituting the security, provided the security is received by the Property
Trustee simultaneously with the creation of the creditor relationship with the
Depositor or the Trust (or any such obligor) arising from the making, drawing,
negotiating or incurring of the draft, ▇▇▇▇ of exchange, acceptance or
obligation.
35
Section 8.14 Reports by Property Trustee.
---------------------------
(a) Within 60 days after October 1 of each year commencing with October 1,
1998, if required by Section 313(a) of the Trust Indenture Act, the Property
Trustee shall transmit a brief report dated as of such October 1 with respect to
any of the events specified in such Section 313(a) that may have occurred since
the later of the date of this Trust Agreement or the preceding October 1.
(b) The Property Trustee shall transmit to Securityholders the reports
required by Section 313(b) of the Trust Indenture Act at the times specified
therein.
(c) Reports pursuant to this Section shall be transmitted in the manner and
to the Persons required by Sections 313(c) and (d) of the Trust Indenture Act.
Section 8.15 Reports to the Property Trustee. The Depositor and the
-------------------------------
Administrative Trustees on behalf of the Trust shall provide to the Property
Trustee such documents, reports and information as required by Section 314 of
the Trust Indenture Act (if any) and, within 120 days after the end of each
fiscal year of the Depositor, the compliance certificate required by Section
314(a)(4) of the Trust Indenture Act in the form and in the manner required by
Section 314 of the Trust Indenture Act.
Section 8.16 Evidence of Compliance with Conditions Precedent. Each of
------------------------------------------------
the Depositor and the Administrative Trustees on behalf of the Trust shall
provide to the Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Trust Agreement that relate to any of
the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given pursuant to Section 314(c)(1) of the
Trust Indenture Act shall comply with Section 314(e) of the Trust Indenture Act.
Section 8.17 Number of Trustees.
------------------
(a) The number of Trustees shall initially be four, provided that the
Depositor by written instrument may increase or decrease the number of
Administrative Trustees.
(b) If a Trustee ceases to hold office for any reason and the number of
Administrative Trustees is not reduced pursuant to Section 8.17(a), or if the
number of Trustees is increased pursuant to Section 8.17(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy, incompetence
or incapacity to perform the duties of a Trustee shall not operate to annul the
Trust. Whenever a vacancy in the number of Administrative Trustees shall occur,
until such vacancy is filled by the appointment of an Administrative Trustee in
accordance with Section 8.10, the Administrative Trustees in office, regardless
of their number (and notwithstanding any other provision of this Trust
Agreement), shall have all powers granted to the Administrative Trustees and
shall discharge the duties imposed upon the Administrative Trustees by this
Trust Agreement.
36
Section 8.18 Delegation of Power.
-------------------
(a) Any Administrative Trustee, may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any documents contemplated in Section
2.07(A), including any registration statement or amendment thereto filed with
the Commission, or making any other governmental filing; and
(b) The Administrative Trustees shall have power to delegate from time to
time to such of their number the doing of such things and the execution of such
instruments either in the name of the Trust or the names of the Administrative
Trustees or otherwise as the Administrative Trustees may deem expedient, to the
extent such delegation is not prohibited by applicable law or contrary to the
provisions of the Trust, as set forth herein.
Section 8.19 Enforcement of Rights of Property Trustee by Securityholders.
------------------------------------------------------------
If (i) the Trust fails to pay Distributions in full on the Preferred Securities
for more than 20 consecutive quarterly distribution periods, or (ii) an
Indenture Event of Default occurs and is continuing, then the Holders of
Preferred Securities will rely on the enforcement by the Property Trustee of its
rights against the Corporation as the holder of the Junior Subordinated Notes.
In addition, the Holders of a majority in aggregate Liquidation Amount of the
Preferred Securities will have the right to direct the time, method, and place
of conducting any proceeding for any remedy available to the Property Trustee or
to direct the exercise of any trust or power conferred upon the Property Trustee
under this Trust Agreement, including the right to direct the Property Trustee
to exercise the remedies available to it as a holder of the Junior Subordinated
Notes, provided that such direction shall not be in conflict with any rule of
law or with this Trust Agreement, and could not involve the Property Trustee in
personal liability in circumstances where reasonable indemnity would not be
adequate. If the Property Trustee fails to enforce its rights under the Junior
Subordinated Notes, a Holder of Preferred Securities may, to the extent
permitted by applicable law, institute a legal proceeding against the
Corporation to enforce its rights under this Trust Agreement without first
instituting any legal proceeding against the Property Trustee or any other
Person, including the Trust; it being understood and intended that no one or
more of such Holders shall have any right in any manner whatsoever by virtue of,
or by availing of, any provision of this Trust Agreement to affect, disturb or
prejudice the rights of any other of such Holders or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce any
right under this Trust Agreement, except in the manner herein provided and for
the equal and ratable benefit of all such Holders. Notwithstanding the
foregoing, a Holder of Preferred Securities may institute a legal proceeding
directly against the Corporation without first instituting a legal proceeding
against or requesting or directing that action be taken by the Property Trustee
or any other Person, for enforcement of payment to such Holder of principal of
or interest on the Junior Subordinated Notes having a principal amount equal to
the aggregate stated Liquidation Amount of the Preferred Securities of such
Holder on or after the due dates therefor specified or provided for in the
Junior Subordinated Notes. The Corporation shall be subrogated to all rights of
the Holders of Preferred Securities in respect of any amounts paid to such
Holders by the Corporation pursuant to this Section.
37
ARTICLE IX
TERMINATION AND LIQUIDATION
Section 9.01 Termination Upon Expiration Date. The Trust shall
--------------------------------
automatically terminate on , (the "Expiration Date") or
earlier pursuant to Section 9.02.
Section 9.02 Early Termination. Upon the first to occur of any of
-----------------
the following events (such first occurrence, an "Early Termination Event"), the
Trust shall be dissolved and terminated in accordance with the terms hereof:
(i) the occurrence of a Bankruptcy Event in respect of the
Depositor, dissolution or liquidation of the Depositor, or the dissolution
of the Trust pursuant to judicial decree;
(ii) the delivery of written direction to the Property Trustee by
the Depositor at any time (which direction is optional and wholly within
the discretion of the Depositor) to terminate the Trust and distribute the
Junior Subordinated Notes to Securityholders as provided in Section 9.04;
and
(iii) the payment at maturity or redemption of all of the Junior
Subordinated Notes, and the consequent payment of the Trust Securities.
Section 9.03 Termination. The respective obligations and responsibilities
-----------
of the Trust and the Trustees created hereby shall terminate upon the latest to
occur of the following: (a) the distribution by the Property Trustee to
Securityholders upon the liquidation of the Trust pursuant to Section 9.04, or
upon the redemption of all of the Trust Securities pursuant to Section 4.02, of
all amounts or instruments required to be distributed hereunder upon the final
payment of the Trust Securities; (b) the payment of any expenses owed by the
Trust; and (c) the discharge of all administrative duties of the Administrative
Trustees, including the performance of any tax reporting obligations with
respect to the Trust or the Securityholders.
Section 9.04 Liquidation.
-----------
(a) If any Early Termination Event specified in clause (ii) of Section 9.02
occurs, the Trust shall be liquidated and the Property Trustee shall distribute
the Junior Subordinated Notes to the Securityholders as provided in this Section
9.04.
(b) In connection with a distribution of the Junior Subordinated Notes,
each Holder of Trust Securities shall be entitled to receive, after the
satisfaction of liabilities to creditors of the Trust (as evidenced by a
certificate of the Administrative Trustees), a Like Amount of Junior
Subordinated Notes. Notice of liquidation shall be given by the Trustees by
first-class mail, postage prepaid, mailed not later than 30 nor more than 60
days prior to the Liquidation Date to each Holder of Trust Securities at such
Holder's address appearing in the Security Register. All notices of liquidation
shall:
(i) state the Liquidation Date;
38
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent a Like Amount of Junior Subordinated Notes; and
(iii) provide such information with respect to the mechanics by
which Holders may exchange Trust Securities Certificates for Junior
Subordinated Notes as the Administrative Trustees or the Property Trustee
shall deem appropriate.
(c) In order to effect the liquidation of the Trust and distribution of the
Junior Subordinated Notes to Securityholders, the Property Trustee shall
establish a record date for such distribution (which shall be not more than 45
days prior to the Liquidation Date) and, either itself acting as exchange agent
or through the appointment of a separate exchange agent, shall establish such
procedures as it shall deem appropriate to effect the distribution of Junior
Subordinated Notes in exchange for the Outstanding Trust Securities
Certificates.
(d) After the Liquidation Date, (i) the Trust Securities will no longer be
deemed to be Outstanding, (ii) certificates representing a Like Amount of Junior
Subordinated Notes will be issued to Holders of Trust Securities Certificates,
upon surrender of such certificates to the Administrative Trustees or their
agent for exchange, (iii) any Trust Securities Certificates not so surrendered
for exchange will be deemed to represent a Like Amount of Junior Subordinated
Notes, accruing interest at the rate provided for in the Junior Subordinated
Notes from the last Distribution Date on which a Distribution was made on such
Trust Certificates until such certificates are so surrendered (and until such
certificates are so surrendered, no payments of interest or principal will be
made to Holders of Trust Securities Certificates with respect to such Junior
Subordinated Notes) and (iv) all rights of Securityholders holding Trust
Securities will cease, except the right of such Securityholders to receive
Junior Subordinated Notes upon surrender of Trust Securities Certificates.
(e) The Depositor will use its best efforts to have the Junior Subordinated
Notes that are distributed in exchange for the Preferred Securities to be listed
on such securities exchange as the Preferred Securities are then listed. The
Depositor may elect to have the Junior Subordinated Notes issued in book-entry
form to the Clearing Agency or its nominee pursuant to a Certificate Depository
Agreement substantially in the form of Exhibit B.
Section 9.05 Bankruptcy. If an Early Termination Event specified in
----------
clause (i) of Section 9.02 has occurred, the Trust shall be liquidated. The
Property Trustee shall distribute the Junior Subordinated Notes to the
Securityholders as provided in Section 9.04, unless such distribution is
determined by the Administrative Trustees not to be practical, in which event
the Holders will be entitled to receive out of the assets of the Trust available
for distribution to Securityholders, after satisfaction of liabilities to
creditors, an amount equal to the Liquidation Amount per Trust Security plus
accrued and unpaid Distributions thereon to the date of payment (such amount
being the "Liquidation Distribution"). If such Liquidation Distribution can be
paid only in part because the Trust has insufficient assets available to pay in
full the aggregate Liquidation Distribution, then, subject to the next
succeeding sentence, the amounts payable by the Trust on the Trust Securities
shall be paid on a pro rata basis (based upon Liquidation Amounts). The Holder
of the Common Securities will be entitled to receive Liquidation Distributions
upon any such dissolution, winding-up or termination pro rata (determined as
aforesaid) with Holders of Preferred Securities, except that, if an Indenture
Event of Default has
39
occurred and is continuing, the Preferred Securities shall have a priority over
the Common Securities.
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01 Guarantee by the Depositor. Subject to the terms and
--------------------------
conditions hereof, the Depositor irrevocably and unconditionally guarantees to
each person or entity to whom the Trust is now or hereafter becomes indebted or
liable (the "Beneficiaries") the full payment, when and as due, of any and all
Obligations (as hereinafter defined) to such Beneficiaries. As used herein,
"Obligations" means any indebtedness, expenses or liabilities of the Trust,
other than obligations of the Trust to pay to Holders of any Preferred
Securities or other similar interests in the Trust the amounts due such Holders
pursuant to the terms of the Preferred Securities or such other similar
interests, as the case may be. Such guarantee is intended to be for the benefit
of, and to be enforceable by, all such Beneficiaries, whether or not such
Beneficiaries have received notice hereof.
Section 10.02 Limitation of Rights of Securityholders. The death or
---------------------------------------
incapacity of any Person having an interest, beneficial or otherwise, in a Trust
Security shall not operate to terminate this Trust Agreement, nor entitle the
legal representatives or heirs of such Person or any Securityholder for such
Person, to claim an accounting, take any action or bring any proceeding in and
for a partition or winding up of the arrangements contemplated hereby, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
Section 10.03 Amendment.
---------
(a) This Trust Agreement may be amended from time to time by the Trustees
and the Depositor, without the consent of any Securityholders, (i) to cure any
ambiguity, correct or supplement any provision herein which may be inconsistent
with any other provision herein, or to make any other provisions with respect to
matters or questions arising under this Trust Agreement, which shall not be
inconsistent with the other provisions of this Trust Agreement, provided,
--------
however, that any such amendment shall not adversely affect in any material
-------
respect the interests of any Securityholder, (ii) to modify, eliminate or add
to any provisions of this Trust Agreement to such extent as shall be necessary
to ensure that the Trust will not be classified as other than a grantor trust
for United States federal income tax purposes at any time that any Trust
Securities are outstanding; provided, however, that, in the case of clause
-------- -------
(i), any amendments of this Trust Agreement shall become effective when notice
thereof is given to the Securityholders or (iii) to provide the Property Trustee
with the authority to execute on behalf of the Administrative Trustees
Definitive Preferred Securities Certificates.
(b) Except as provided in Section 10.03(c) hereof, any provision in this
Trust Agreement may be amended by the Trust or the Trustees with (i) the consent
of Securityholders representing not less than 66-2/3% (based upon Liquidation
Amounts) of the Trust Securities then Outstanding and (ii) receipt by the
Trustees of an Opinion of Counsel to the effect that such amendment or the
exercise of any power granted to the Trustees in accordance with such amendment
will not affect the Trust's status as a grantor trust for United States federal
income
40
tax purposes or the Trust's exemption from status of an "investment company"
under the Investment Company Act.
(c) In addition to and notwithstanding any other provision in this Trust
Agreement, without the consent of each affected Securityholder (such consent
being obtained in accordance with Section 6.03 or 6.06 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution (or payment upon redemption) on the Trust Securities or otherwise
adversely affect the amount of any Distribution (or payment upon redemption)
required to be made in respect of the Trust Securities as of a specified date,
(ii) restrict the right of a Securityholder to institute suit for the
enforcement of any such payment on or after such date, (iii) change the purpose
of the Trust, (iv) authorize the issuance of any additional beneficial interests
in the Trust, or (v) change the consent required pursuant to this Section 10.03.
(d) Notwithstanding any other provisions of this Trust Agreement, the
Trustees shall not enter into or consent to any amendment to this Trust
Agreement which would cause the Trust to fail or cease to qualify for the
exemption from status of an "investment company" under the Investment Company
Act of 1940, as amended, afforded by Rule 3a-5 thereunder.
(e) Without the consent of the Depositor, this Trust Agreement may not be
amended in a manner which imposes any additional obligation on the Depositor.
In executing any amendment permitted by this Trust Agreement, the Trustees shall
be entitled to receive, and (subject to Section 8.01) shall be fully protected
in relying upon an Opinion of Counsel stating that the execution of such
amendment is authorized or permitted by this Trust Agreement. Any Trustee may,
but shall not be obligated to, enter into any such amendment which affects such
Trustee's own rights, duties, immunities or liabilities under this Trust
Agreement or otherwise.
(f) In the event that any amendment to this Trust Agreement is made, the
Administrative Trustees shall promptly provide to the Depositor a copy of such
amendment.
Section 10.04 Separability. In case any provision in this Trust Agreement
------------
or in the Trust Securities Certificates shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 10.05 Governing Law. THIS TRUST AGREEMENT AND THE RIGHTS AND
-------------
OBLIGATIONS OF EACH OF THE SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH
RESPECT TO THIS TRUST AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF DELAWARE;
PROVIDED THAT THE IMMUNITIES AND STANDARD OF CARE OF THE PROPERTY TRUSTEE SHALL
BE GOVERNED BY NEW YORK LAW.
Section 10.06 Notice of Deferral of Distribution. In the event that the
----------------------------------
Depositor exercises its right to extend an interest payment period in respect of
the Junior Subordinated Notes pursuant to Section 104 of the Supplemental
Indenture and notice of such extension has been provided by the Depositor to the
Property Trustee, the Property Trustee shall give written notice of such
extension and of the deferral of the related Distribution on the Trust
Securities, by first-class mail, postage prepaid, mailed not later than ten days
prior to the Distribution Date upon which such Distribution would otherwise be
payable, to each Holder of Preferred Securities at such Holder's address
appearing in the Security Register.
Section 10.07 Headings. The Article and Section headings are for
--------
convenience only and shall not affect the construction of this Trust Agreement.
Section 10.08 Notice and Demand. Any notice, demand or other
-----------------
communication which by any provision of this Trust Agreement is required or
permitted to be given or served to or upon any Securityholder or the Depositor
may be given or served in writing by deposit thereof,
41
first class postage prepaid, in the United States mail, hand delivery or
facsimile transmission, in each case, addressed, (i) in the case of a Preferred
Securityholder, to such Preferred Securityholder as such Securityholder's name
and address appear on the Security Register and (ii) in the case of the Common
Securityholder or the Depositor, to Duke Energy Corporation, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Treasurer, Facsimile No.
(▇▇▇) ▇▇▇-▇▇▇▇, with a copy to Corporate Secretary, Facsimile No.
(▇▇▇) ▇▇▇-▇▇▇▇. Such notice, demand or other communication to or upon a
Securityholder shall be deemed to have been sufficiently given or made, for
all purposes, upon hand delivery, mailing or transmission.
Any notice, demand or other communication which by any provision of this
Trust Agreement is required or permitted to be given or served to or upon the
Trust or the Trustees shall be given in writing addressed (until another address
is published by the Trust) as follows: (i) with respect to the Property Trustee
and the Delaware Trustee, The Chase Manhattan Bank, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trustee Administration Department;
Chase Manhattan Bank Delaware, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Department, as the case may be; and (ii) with
respect to the Administrative Trustees, to them at the address above for notices
to the Depositor, marked Attention: Administrative Trustees of Duke Energy
Capital Trust [ ] c/o Corporate Secretary. Such notice, demand or other
communication to or upon the Trust or the Trustees shall be deemed to have been
sufficiently given or made only upon actual receipt of the writing by the
applicable Trustee.
Section 10.09 Agreement Not to Petition. Each of the Trustees and the
-------------------------
Depositor agrees for the benefit of the Securityholders that, until at least one
year and one day after the Trust has been terminated in accordance with Article
IX, it shall not file, or join in the filing of, a petition against the Trust
under any bankruptcy, reorganization, arrangement, insolvency, liquidation or
other similar law (including, without limitation, the United States Bankruptcy
Code) (collectively, "Bankruptcy Laws") or otherwise join in the commencement of
any proceeding against the Trust under any Bankruptcy Law. In the event the
Depositor takes action in violation of this Section 10.09, the Property Trustee
agrees, for the benefit of Securityholders, that it shall file an answer with
the bankruptcy court or otherwise properly contest the filing of such petition
by the Depositor against the Trust or the commencement of such action and raise
the defense that the Depositor has agreed in writing not to take such action and
should be stopped and precluded therefrom and such other defenses, if any, as
counsel for the Trustees or the Trust may assert. The provisions of this
Section 10.09 shall survive the termination of this Trust Agreement.
Section 10.10 Conflict with Trust Indenture Act.
---------------------------------
(a) This Trust Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trust Agreement and shall, to
the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a Trustee for
the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required to be included in this Trust Agreement by any
of the provisions of the Trust Indenture Act, such required provision shall
control.
42
(d) The application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Trust Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY OR ON
BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST
SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND AGREEMENT
TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE
SUBORDINATED INDENTURE AND THE AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER AND
SUCH OTHERS THAT THOSE TERMS AND PROVISIONS SHALL BE BINDING, OPERATIVE AND
EFFECTIVE AS BETWEEN THE TRUST AND SUCH SECURITYHOLDER AND SUCH OTHERS.
Section 10.11 Successors. This Trust Agreement shall be binding upon and
----------
shall inure to the benefit of any successor to both the Trust and the Trustees,
including any successor by operation of law.
43
IN WITNESS WHEREOF, the parties hereto have executed this Trust Agreement
or have caused this Trust Agreement to be executed on their behalf, all as of
the day and year first above written.
DUKE ENERGY CORPORATION
By:
-------------------------------
Its
THE CHASE MANHATTAN BANK,
as Property Trustee
By:
-------------------------------
Title:
----------------------------
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By:
-------------------------------
Title:
----------------------------
----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III,
as Administrative Trustee
-----------------------------------
S. L. Love,
as Administrative Trustee
44
EXHIBIT A
CERTIFICATE OF TRUST
OF
DUKE ENERGY CAPITAL TRUST [ ]
THIS Certificate of Trust of Duke Energy Capital Trust [ ] (the
"Trust"), dated as of November 14, 1997, is being duly executed and filed by the
undersigned, as trustee, to form a business trust under the Delaware Business
Trust Act (12 Del. C. (S)3801, et seq.).
------- -- ---
1. Name. The name of the business trust formed hereby is Duke Energy
----
Capital Trust [ ].
2. Delaware Trustee. The name and business address of the trustee of
----------------
the Trust with a principal place of business in the State of Delaware are Chase
Manhattan Bank Delaware, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
3. Effective Date. This Certificate of Trust shall be effective upon
--------------
filing.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the
Trust, has executed this Certificate of Trust as of the date first-above
written.
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as trustee of the Trust
By:
_____________________________
Name:
Title:
Exhibit A -- Page 1
EXHIBIT B
_____________, 199
The Depository Trust Company
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ 10041-0099
Attention: General Counsel's Office
Re: Duke Energy Capital Trust [ ]
% Trust Preferred Securities
Ladies and Gentlemen:
The purpose of this letter is to set out certain matters relating to
the above-referenced Preferred Securities (CUSIP No. ) (the "Securities")
of Duke Energy Capital Trust [ ], a Delaware statutory business trust (the
"Trust"). The Securities are guaranteed to the extent set forth in the
Prospectus relating to the Securities dated , 199 by Duke Energy
Corporation, a North Carolina corporation. The Trust is selling the Securities
to certain underwriters (the "Underwriters") pursuant to an Underwriting
Agreement dated , 199 , and the Underwriters wish to take delivery of
the Securities through The Depository Trust Company ("DTC"). The Trust is
acting as transfer agent and registrar with respect to the Securities. The
Chase Manhattan Bank, in its capacity as Property Trustee of the Trust, will act
as paying agent in relation to the Securities (the "Property Trustee").
To induce DTC to accept the Securities as eligible for deposit at DTC,
and to act in accordance with its rules with respect to the Securities, the
Trust and the Property Trustee severally, as set forth below each make the
following representations to DTC.
1. Before the closing of the sale of the Securities to the
Underwriters, which is expected to occur on or about , 199 there
shall be deposited with DTC one or more global certificates (the "Global
Certificate") registered in the name of DTC's nominee, Cede & Co., for
Securities.
2. The Amended and Restated Trust Agreement dated as of ,
199 provides for the voting by holders of the Securities under certain
circumstances. The Trust shall establish a record date for such purposes and
shall, to the extent possible, give DTC notice of such record date not less than
15 calendar days in advance of such record date. Notices to DTC pursuant to
this paragraph by telecopy shall be sent to DTC's Reorganization Department at
(▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇, and receipt of such notices shall be confirmed
by telephoning (▇▇▇) ▇▇▇-▇▇▇▇. Notices to DTC pursuant to this paragraph by
mail or by other means shall be sent to DTC's Reorganization Department as
indicated in paragraph 6.
3. In the event of a stock split, conversion, recapitalization,
reorganization or any other similar transaction resulting in the cancellation of
all or any part of the Securities outstanding, the Trust shall send DTC a notice
of such event 5 business days prior to the effective date of such event.
4. In the event of a distribution with respect to the Securities
outstanding, the Property Trustee shall send DTC a notice specifying the amount
of and conditions, if any, applicable to such payment or distribution. Such
notice shall be sent to DTC by a secure means (e.g., legible telecopy,
----
registered or certified mail, overnight delivery) in a timely manner designed to
assure that such notice is in DTC's possession no later than the close of
business on the business day before the record date for such distribution. (The
Property Trustee shall have a method to verify subsequently the use of such
means and the timeliness of such notice.) After establishing the amount of
payment to be made on the Securities, the Property Trustee will notify DTC's
Dividend Department of such payment 5 business days prior to the payment date.
5. In the event of a redemption by the Trust of the Securities,
notice to holders of the Securities by the Trust specifying the terms of the
redemption shall be sent to DTC not less than 30 days prior to such event by a
secure means in the manner set forth in the preceding paragraph. Such
redemption notice shall be sent to DTC's Call Notification Department at (516)
227-4039 or 4190, and receipt of such notice shall be confirmed by telephoning
(▇▇▇) ▇▇▇-▇▇▇▇. Notice by mail or by any other means shall be sent to:
Call Notification Department
The Depository Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
6. In the event of any invitation to tender the Securities, notice by
the Trust to holders of the Securities specifying the terms of the tender shall
be sent to DTC by the Trust by a secure means by the close of business on the
Business Day before such notice is given to such Holders. Notices to DTC
pursuant to this paragraph and notices of other corporate actions (including
mandatory tenders, exchanges and capital changes), shall be sent by telecopy to
DTC's Reorganization Department at (▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇, and receipt
of such notices shall be confirmed by telephoning (▇▇▇) ▇▇▇-▇▇▇▇, or by mail or
any other means to:
Manager, Reorganization Department
Reorganization Window
The Depository Trust Company
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
7. All notices and payment advices sent to DTC shall contain the
CUSIP number of the Securities and the accompanying description of the
Securities, which, as of the date of this letter, is "Duke Energy Capital Trust
[ ], % Trust Preferred Securities."
8. Notices to DTC's Dividend Department by telecopy shall be sent to
(▇▇▇) ▇▇▇-▇▇▇▇. Such notices by mail or by any other means shall be sent to:
Exhibit B -- Page 2
Manager, Announcements
Dividend Department
The Depository Trust Company
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
The Trust shall confirm DTC's receipt of such telecopy by telephoning
the Dividend Department at (▇▇▇) ▇▇▇-▇▇▇▇.
9. Payments of cash distributions, including payments on redemption,
with respect to the Securities evidenced by the Global Certificate shall be
received by Cede & Co., as nominee of DTC, or its registered assigns in same day
funds on each payment date (or in accordance with existing arrangements between
the Property Trustee and DTC). Such payments shall be made payable to the order
of Cede & Co.
10. Other cash payments shall be received by Cede & Co., as a nominee
of DTC, or its registered assigns in next day funds on each payment date (or in
accordance with existing arrangements between the Property Trustee and DTC).
Such payments shall be made payable to the order of Cede & Co., and shall be
addressed as follows:
NFDS Redemption Department
The Depository Trust Department
7 Hanover Square, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
11. DTC may direct the Trust and the Property Trustee to use any
other telecopy number or address of DTC as the number or address to which
notices or payments may be sent.
12. In the event of a conversion, redemption, or any other similar
transaction (e.g., tender made and accepted in response to the Trust's
----
invitation) necessitating a reduction in the aggregate number of Securities
outstanding, DTC, in its discretion: (a) may request the Trust to issue and
authenticate a new Security certificate; or (b) may make an appropriate notation
on the Security certificate indicating the date and amount of such reduction.
13. DTC may discontinue its services as a securities depositary with
respect to the Global Certificate at any time by giving reasonable notice to the
Trust (at which time DTC will confirm with the Trust the aggregate number of
Securities deposited with it) and discharging its responsibilities with respect
thereto under applicable law. Under such circumstances, at DTC's request the
Trust shall cooperate fully with DTC by taking prompt appropriate action to make
alternative arrangements for book-entry settlement for the Securities or to make
available one or more separate certificates evidencing Securities, to any
participant having Securities credited to its DTC account.
14. In the event that the Trust determines that beneficial owners of
Securities shall be able to obtain certificated Securities, the Trust shall
notify DTC of the availability of certificates. In such event, the Trust shall
issue, transfer and exchange certificates in appropriate amounts, as required by
DTC and others.
Exhibit B -- Page 3
15. Nothing herein shall require the Property Trustee to advance its
own funds for any purposes.
This letter may be executed in any number of counterparts, each of
which when so executed shall be deemed to be an original but all such
counterparts shall together constitute but one and the same instrument.
Very truly yours,
Duke Energy Capital Trust [ ]
By: Duke Energy Corporation
as Depositor
By:
-----------------------------
Name:
Title:
RECEIVED AND ACCEPTED:
THE DEPOSITORY TRUST COMPANY
BY:
----------------------------------
Authorized Officer
Exhibit B -- Page 4
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
EXCEPT AS PROVIDED IN THE TRUST
AGREEMENT REFERRED TO HEREIN
Certificate Number Number of Common Securities
C-1
Certificate Evidencing Common Securities
of
Duke Energy Capital Trust [ ]
Common Securities
(Liquidation Amount $25 per Common Security)
Duke Energy Capital Trust [ ], a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies that Duke
Energy Corporation (the "Holder") is the registered owner of ( )
common securities of the Trust representing undivided beneficial interests in
the assets of the Trust and designated the Common Securities (Liquidation Amount
$25 per Common Security) (the "Common Securities"). In accordance with Section
5.10 of the Trust Agreement (as defined below) the Common Securities are not
transferable, except by operation of law or to an Affiliate of the Holder or a
permitted successor under Section 801 of the Subordinated Indenture, dated as of
, 19 , between the Holder and The Chase Manhattan Bank, as trustee, and
any attempted transfer hereof shall be void. The designations, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities are set forth in, and this certificate and the Common
Securities represented hereby are issued and shall in all respects be subject to
the terms and provisions of, the Amended and Restated Trust Agreement of the
Trust dated as of , 199 , as the same may be amended from time to time
(the "Trust Agreement"), including the designation of the terms of the Common
Securities as set forth therein. The Trust will furnish a copy of the Trust
Agreement to the Holder without charge upon written request to the Trust at its
principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
Exhibit C -- Page 1
IN WITNESS WHEREOF, the Administrative Trustees of the Trust have
executed this certificate this day of , 199 .
Duke Energy Capital Trust [ ]
By:
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III,
as Administrative Trustee
By:
--------------------------------
S.L. Love,
as Administrative Trustee
CERTIFICATE OF AUTHENTICATION
This is one of the Common Securities referred to in the within-
mentioned Trust Agreement.
-------------------------------------
as Administrative Trustee
Exhibit C -- Page 2
EXHIBIT D
AGREEMENT AS TO EXPENSES AND LIABILITIES
THIS AGREEMENT AS TO EXPENSES AND LIABILITIES (this "Agreement") is made as
of , 199 between Duke Energy Corporation, a North Carolina
corporation (the "Corporation"), and Duke Energy Capital Trust [ ], a Delaware
business trust (the "Trust").
WHEREAS, the Trust intends to issue its Common Securities (the "Common
Securities") to and receive Series % Junior Subordinated Notes due
, (the "Junior Subordinated Notes") from the Corporation and to
issue and sell Duke Energy Capital Trust [ ] % Trust Preferred Securities
(the "Preferred Securities") with such powers, preferences and special rights
and restrictions as are set forth in the Amended and Restated Trust Agreement of
the Trust dated as of , 199 as the same may be amended from time to time
(the "Trust Agreement"); and
WHEREAS, the Corporation is the issuer of the Junior Subordinated Notes.
NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase the Corporation hereby agrees shall benefit
the Corporation and which purchase the Corporation acknowledges will be made in
reliance upon the execution and delivery of this Agreement, the Corporation and
the Trust hereby agree as follows:
ARTICLE I
Section 1.01. Guarantee by the Corporation. Subject to the terms and
----------------------------
conditions hereof, the Corporation hereby irrevocably and unconditionally
guarantees to each person or entity to whom the Trust is now or hereafter
becomes indebted or liable (the "Beneficiaries") the full payment, when and as
due, of any and all Obligations (as hereinafter defined) to such Beneficiaries.
As used herein, "Obligations" means any indebtedness, expenses or liabilities of
the Trust, other than obligations of the Trust to pay to holders of any
Preferred Securities or other similar interests in the Trust the amounts due
such holders pursuant to the terms of the Preferred Securities or such other
similar interests, as the case may be. This Agreement is intended to be for the
benefit of, and to be enforceable by, all such Beneficiaries, whether or not
such Beneficiaries have received notice hereof.
Section 1.02. Term of Agreement. This Agreement shall terminate and be of
-----------------
no further force and effect upon the date on which there are no Beneficiaries
remaining; provided, however, that this Agreement shall continue to be effective
-------- -------
or shall be reinstated, as the case may be, if at any time any holder of
Preferred Securities or any Beneficiary must restore payment of any sums paid
under the Preferred Securities, under any Obligation, under the Guarantee
Agreement dated the date hereof by the Corporation and The Chase Manhattan Bank,
as guarantee trustee, or under this Agreement for any reason whatsoever. This
Agreement is continuing, irrevocable, unconditional and absolute.
Section 1.03. Waiver of Notice. The Corporation hereby waives notice of
----------------
acceptance of this Agreement and of any Obligation to which it applies or may
apply, and the Corporation
Exhibit D -- Page 1
hereby waives presentment, demand for payment, protest, notice of nonpayment,
notice of dishonor, notice of redemption and all other notices and demands.
Section 1.04. No Impairment. The obligations, covenants, agreements and
-------------
duties of the Corporation under this 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 extension of time for the payment by the Trust of all or any
portion of the Obligations or for the performance of any other obligation
under, arising out of, or in connection with, the Obligations;
(b) any failure, omission, delay or lack of diligence on the part of
the Beneficiaries to enforce, assert or exercise any right, privilege,
power or remedy conferred on the Beneficiaries with respect to the
Obligations or any action on the part of the Trust granting indulgence or
extension of any kind; or
(c) 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 Trust
or any of the assets of the Trust.
There shall be no obligation of the Beneficiaries to give notice to, or obtain
the consent of, the Corporation with respect to the happening of any of the
foregoing.
Section 1.05. Enforcement. A Beneficiary may enforce this Agreement
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directly against the Corporation and the Corporation waives any right or remedy
to require that any action be brought against the Trust or any other person or
entity before proceeding against the Corporation.
ARTICLE II
Section 2.01. Binding Effect. All guarantees and agreements contained in
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this Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Corporation and shall inure to the benefit of the
Beneficiaries.
Section 2.02. Amendment. So long as there remains any Beneficiary or any
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Preferred Securities are outstanding, this Agreement shall not be modified or
amended in any manner adverse to such Beneficiary or to the holders of the
Preferred Securities.
Section 2.03. Notices. Any notice, request or other communication
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required or permitted to be given hereunder shall be given in writing by
delivering the same against receipt therefor by facsimile transmission
(confirmed by mail), or by registered or certified mail, addressed as follows
(and if so given, shall be deemed given when mailed), to-wit:
Exhibit D -- Page 2
Duke Energy Capital Trust [ ]
c/o The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trustee
Administration Department
Duke Energy Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Secretary
Section 2.04. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THIS AGREEMENT is executed as of the date and year first above written.
DUKE ENERGY CORPORATION
By:
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Name:
Title:
DUKE ENERGY CAPITAL TRUST [ ]
By:
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III, as
Administrative Trustee
By:
---------------------------------
S.L. Love, as
Administrative Trustee
Exhibit D -- Page 3
EXHIBIT E
Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to Duke Energy
Capital Trust [ ] or its agent for registration of transfer, exchange, or
payment, and any certificate issued is registered in the name of Cede & Co. or
in such other name as is requested by an authorized representative of DTC (and
any payment made to Cede & Co. or 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 thereof, Cede & Co., has an interest herein.
Certificate Number Number of Preferred Securities
P-1 CUSIP NO.
Certificate Evidencing Preferred Securities
of
Duke Energy Capital Trust [ ]
% Trust Preferred Securities
(Liquidation Amount $25 per Preferred Security)
Duke Energy Capital Trust [ ], a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies that Cede &
Co. (the "Holder") is the registered owner of ( )
Preferred Securities of the Trust representing undivided beneficial interests
in the assets of the Trust and designated the Duke Energy Capital Trust [ ] %
Trust Preferred Securities (Liquidation Amount $25 per Preferred Security) (the
"Preferred Securities"). The Preferred 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 as
provided in Section 5.04 of the Trust Agreement (as defined below). The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Preferred Securities are set forth in, and this certificate
and the Preferred Securities represented hereby are issued and shall in all
respects be subject to the terms and provisions of, the Amended and Restated
Trust Agreement of the Trust, dated as of , 199 , as the same may
be amended from time to time (the "Trust Agreement"), including the designation
of the terms of Preferred Securities as set forth therein. The holder of this
certificate is entitled to the benefits of a guarantee by Duke Energy
Corporation, a North Carolina corporation (the "Corporation"), pursuant to a
Guarantee Agreement between the Corporation and The Chase Manhattan Bank, as
guarantee trustee, dated as of , 199 , as the same may be amended
from time to time (the "Guarantee"), to the extent provided therein. The Trust
will furnish a copy of the Trust Agreement and the Guarantee to the holder of
this certificate without charge upon written request to the Trust at its
principal place of business or registered office.
Upon receipt of this certificate, the holder of this certificate is
bound by the Trust Agreement and is entitled to the benefits thereunder.
Exhibit E -- Page 1
IN WITNESS WHEREOF, the Administrative Trustees of the Trust have
executed this certificate this day of , 199 .
DUKE ENERGY CAPITAL TRUST [ ]
By:
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III,
as Administrative Trustee
By:
--------------------------------
S.L. Love,
as Administrative Trustee
CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the within-
mentioned Trust Agreement.
-----------------------------------
as Administrative Trustee
Exhibit E -- Page 2
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security to:
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(Insert assignee's social security or tax identification number)
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(Insert address and zip code of assignee)
and irrevocably appoints
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agent to transfer this Preferred Securities Certificate on the books of the
Trust. The agent may substitute another to act for him or her.
Date:
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Signature:
---------------------------------
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
Exhibit E -- Page 3