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AMENDED AND RESTATED DECLARATION
OF TRUST
BY AND AMONG
STATE STREET BANK AND TRUST COMPANY
OF CONNECTICUT, NATIONAL ASSOCIATION,
AS INSTITUTIONAL TRUSTEE,
FIRST COMMUNITY BANCORP,
AS SPONSOR,
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ AND ▇▇▇▇▇▇ ▇. ▇▇▇▇,
AS ADMINISTRATORS
DATED AS OF SEPTEMBER 7, 2000
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TABLE OF CONTENTS
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ARTICLE I INTERPRETATION AND DEFINITIONS..........................................................................1
Section 1.1. Definitions............................................................................1
ARTICLE II ORGANIZATION...........................................................................................7
Section 2.1. Name...................................................................................7
Section 2.2. Office.................................................................................7
Section 2.3. Purpose................................................................................7
Section 2.4. Authority..............................................................................8
Section 2.5. Title to Property of the Trust.........................................................8
Section 2.6. Powers and Duties of the Trustees and the Administrators...............................8
Section 2.7. Prohibition of Actions by the Trust and the Trustees..................................11
Section 2.8. Powers and Duties of the Institutional Trustee........................................12
Section 2.9. Certain Duties and Responsibilities of the Trustees and Administrators................13
Section 2.10. Certain Rights of Institutional Trustee...............................................14
Section 2.11. Execution of Documents................................................................16
Section 2.12. Not Responsible for Recitals or Issuance of Securities................................16
Section 2.13. Duration of Trust.....................................................................17
Section 2.14. Mergers...............................................................................17
ARTICLE III SPONSOR..............................................................................................18
Section 3.1. Sponsor's Purchase of Common Securities...............................................18
Section 3.2. Responsibilities of the Sponsor.......................................................18
Section 3.3. Expenses..............................................................................18
Section 3.4. Right to Proceed......................................................................19
ARTICLE IV TRUSTEES AND ADMINISTRATORS...........................................................................19
Section 4.1. Number of Trustees....................................................................19
Section 4.2. Institutional Trustee; Eligibility....................................................19
Section 4.3. Administrators........................................................................20
Section 4.4. Appointment, Removal and Resignation of Trustees and Administrators...................20
Section 4.5. Vacancies Among Trustees..............................................................21
Section 4.6. Effect of Vacancies...................................................................21
Section 4.7. Meetings of the Trustees and the Administrators.......................................21
Section 4.8. Delegation of Power...................................................................22
Section 4.9. Conversion, Consolidation or Succession to Business...................................22
ARTICLE V DISTRIBUTIONS..........................................................................................22
Section 5.1. Distributions.........................................................................22
ARTICLE VI ISSUANCE OF SECURITIES................................................................................23
Section 6.1. General Provisions Regarding Securities...............................................23
Section 6.2. Paying Agent, Transfer Agent and Registrar............................................23
Section 6.3. Form and Dating.......................................................................24
Section 6.4. Mutilated, Destroyed, Lost or Stolen Certificates.....................................24
Section 6.5. Temporary Securities..................................................................24
Section 6.6. Cancellation..........................................................................25
Section 6.7. Rights of Holders; Waivers of Past Defaults...........................................25
ARTICLE VII DISSOLUTION AND TERMINATION OF TRUST.................................................................26
Section 7.1. Dissolution and Termination of Trust..................................................26
ARTICLE VIII TRANSFER OF INTERESTS...............................................................................27
Section 8.1. General...............................................................................27
Section 8.2. Transfer Procedures and Restrictions..................................................28
Section 8.3. Deemed Security Holders...............................................................29
ARTICLE IX LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS..................................29
Section 9.1. Liability.............................................................................29
Section 9.2. Exculpation...........................................................................30
Section 9.3. Fiduciary Duty........................................................................30
Section 9.4. Indemnification.......................................................................31
Section 9.5. Outside Businesses....................................................................32
Section 9.6. Compensation; Fee.....................................................................33
ARTICLE X ACCOUNTING.............................................................................................33
Section 10.1. Fiscal Year...........................................................................33
Section 10.2. Certain Accounting Matters............................................................33
Section 10.3. Banking...............................................................................34
Section 10.4. Withholding...........................................................................34
ARTICLE XI AMENDMENTS AND MEETINGS...............................................................................34
Section 11.1. Amendments............................................................................34
Section 11.2. Meetings of the Holders of Securities; Action by Written Consent......................36
ARTICLE XII REPRESENTATIONS OF INSTITUTIONAL TRUSTEE.............................................................37
Section 12.1. Representations and Warranties of Institutional Trustee...............................37
ARTICLE XIII MISCELLANEOUS.......................................................................................37
Section 13.1. Notices...............................................................................37
Section 13.2. Governing Law.........................................................................38
Section 13.3. Intention of the Parties..............................................................39
Section 13.4. Headings..............................................................................39
Section 13.5. Successors and Assigns................................................................39
Section 13.6. Partial Enforceability................................................................39
Section 13.7. Counterparts..........................................................................39
Annex I....................Terms of Securities
Exhibit A-I................Form of Capital Security Certificate
Exhibit A-2................Form of Common Security Certificate
Exhibit B..................Specimen of Initial Debenture
Exhibit C..................Placement Agreement
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AMENDED AND RESTATED
DECLARATION OF TRUST
OF
FIRST COMMUNITY STATUTORY TRUST I
SEPTEMBER 7, 2000
AMENDED AND RESTATED DECLARATION OF TRUST ("DECLARATION") dated and
effective as of September 7, 2000, by the Trustees (as defined herein), the
Administrators (as defined herein), the Sponsor (as defined herein) and by the
holders, from time to time, of undivided beneficial interests in the Trust (as
defined herein) to be issued pursuant to this Declaration;
WHEREAS, the Trustees, the Administrators and the Sponsor established
First Community Statutory Trust I (the "TRUST"), a statutory trust under the
Connecticut Statutory Trust Act pursuant to a Declaration of Trust dated as of
August 24, 2000 (the "ORIGINAL DECLARATION"), and a Certificate of Trust filed
with the Secretary of State of the State of Connecticut on August 25, 2000,
for the sole purpose of issuing and selling certain securities representing
undivided beneficial interests in the assets of the Trust and investing the
proceeds thereof in certain debentures of the Debenture Issuer (as defined
herein);
WHEREAS, as of the date hereof, no interests in the Trust have been
issued; and
WHEREAS, all of the Trustees, the Administrators and the Sponsor, by
this Declaration, amend and restate each and every term and provision of the
Original Declaration;
NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a statutory trust under the Statutory Trust Act (as
defined herein) and that this Declaration constitutes the governing instrument
of such statutory trust, the Trustees declare that all assets contributed to
the Trust will be held in trust for the benefit of the holders, from time to
time, of the securities representing undivided beneficial interests in the
assets of the Trust issued hereunder, subject to the provisions of this
Declaration. The parties hereto hereby agree as follows:
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 DEFINITIONS. Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined in the
preamble above have the respective meanings assigned to them in this Section
1.1;
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections and
Annexes and Exhibits are to Articles and Sections of and Annexes and Exhibits
to this Declaration unless otherwise specified; and
(e) a reference to the singular includes the plural and vice versa.
"ADDITIONAL INTEREST" has the meaning set forth in the Indenture.
"ADMINISTRATORS" means each of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇,
solely in such Person's capacity as Administrator of the Trust created and
continued hereunder and not in such Person's individual capacity, or such
Administrator's successor in interest in such capacity, or any successor
appointed as herein provided.
"AFFILIATE" has the same meaning as given to that term in Rule 405 of
the Securities Act or any successor rule thereunder.
"AUTHORIZED OFFICER" of a Person means any Person that is authorized
to bind such Person.
"BANKRUPTCY EVENT" means, with respect to any Person:
(a) a court having jurisdiction in the premises shall enter a decree
or order for relief in respect of such Person in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of such Person or for any substantial part
of its property, or ordering the winding-up or liquidation of its affairs and
such decree or order shall remain unstayed and in effect for a period of 90
consecutive days; or
(b) such Person shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, shall
consent to the entry of an order for relief in an involuntary case under any
such law, or shall consent to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian, sequestrator (or other
similar official) of such Person of any substantial part of its property, or
shall make any general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due.
"BUSINESS DAY" means any day other than Saturday, Sunday or any other
day on which banking institutions in New York City or Hartford, Connecticut
are permitted or required by any applicable law to close.
"CAPITAL SECURITIES" has the meaning set forth in Section 6.1(a).
"CAPITAL SECURITY CERTIFICATE" means a definitive Certificate in
fully registered form representing a Capital Security substantially in the
form of Exhibit A-1.
"CAPITAL TREATMENT EVENT" has the meaning set forth in paragraph 4(a)
of Annex I.
"CERTIFICATE" means any certificate evidencing Securities.
"CLOSING DATE" has the meaning set forth in the Placement Agreement.
"CODE" means the Internal Revenue Code of 1986, as amended from time
to time, or any successor legislation.
"COMMISSION" means the Securities and Exchange Commission.
"COMMON SECURITIES" has the meaning set forth in Section 6.1(a).
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"COMMON SECURITY CERTIFICATE" means a definitive Certificate in fully
registered form representing a Common Security substantially in the form of
Exhibit A-2.
"COMPANY INDEMNIFIED PERSON" means (a) any Administrator; (b) any
Affiliate of any Administrator; (c) any officers, directors, shareholders,
members, partners, employees, representatives or agents of any Administrator;
or (d) any officer, employee or agent of the Trust or its Affiliates.
"COMPARABLE TREASURY ISSUE" has the meaning set forth in paragraph
4(a) of Annex I.
"COMPARABLE TREASURY PRICE" has the meaning set forth in paragraph
4(a) of Annex I.
"CORPORATE TRUST OFFICE" means the office of the Institutional
Trustee at which the corporate trust business of the Institutional Trustee
shall, at any particular time, be principally administered, which office at
the date of execution of this Declaration is located at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇ Square, Hartford, Connecticut.
"COUPON RATE" has the meaning set forth in paragraph 2(a) of Annex I.
"COVERED PERSON" means: (a) any Administrator, officer, director,
shareholder, partner, member, representative, employee or agent of (i) the
Trust or (ii) any of the Trust's Affiliates; and (b) any Holder of Securities.
"CREDITOR" has the meaning set forth in Section 3.3.
"DEBENTURE ISSUER" means First Community Bancorp, a California
corporation, in its capacity as issuer of the Debentures under the Indenture.
"DEBENTURE TRUSTEE" means State Street Bank and Trust Company of
Connecticut, National Association, as trustee under the Indenture until a
successor is appointed thereunder, and thereafter means such successor trustee.
"DEBENTURES" means the 10.60% Junior Subordinated Deferrable Interest
Debentures due 2030 to be issued by the Debenture Issuer under the Indenture.
"DEFAULTED INTEREST" has the meaning set forth in the Indenture.
"DIRECT ACTION" has the meaning set forth in Section 2.8(d).
"DISTRIBUTION" means a distribution payable to Holders of Securities
in accordance with Section 5.1.
"DISTRIBUTION PAYMENT DATE" has the meaning set forth in paragraph
2(b) of Annex I.
"EVENT OF DEFAULT" means any one of the following events (whatever
the reason for such event and whether it shall be voluntary or involuntary or
be effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body):
(a) the occurrence of an Indenture Event of Default; or
(b) default by the Trust in the payment of any Redemption Price of
any Security when it becomes due and payable; or
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(c) default in the performance, or breach, in any material respect,
of any covenant or warranty of the Trustees in this Declaration (other than
those specified in clause (a) or (b) above) and continuation of such default
or breach for a period of 60 days after there has been given, by registered or
certified mail to the Trustees and to the Sponsor by the Holders of at least
25% in aggregate liquidation amount of the outstanding Capital Securities a
written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder; or
(d) the occurrence of a Bankruptcy Event with respect to the
Institutional Trustee if a successor Institutional Trustee has not been
appointed within 90 days thereof.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"EXTENSION PERIOD" has the meaning set forth in paragraph 2(b) of
Annex I.
"FEDERAL RESERVE" has the meaning set forth in paragraph 3 of Annex I.
"FIDUCIARY INDEMNIFIED PERSON" shall mean the Institutional Trustee,
any Affiliate of the Institutional Trustee and any officers, directors,
shareholders, members, partners, employees, representatives, custodians,
nominees or agents of the Institutional Trustee.
"FISCAL YEAR" has the meaning set forth in Section 10.1.
"GUARANTEE" means the guarantee agreement to be dated as of the
Closing Date, of the Sponsor in respect of the Capital Securities.
"HOLDER" means a Person in whose name a Certificate representing a
Security is registered, such Person being a beneficial owner within the
meaning of the Statutory Trust Act.
"INDEMNIFIED PERSON" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"INDENTURE" means the Indenture dated as of the Closing Date, between
the Debenture Issuer and the Debenture Trustee, and any indenture supplemental
thereto pursuant to which the Debentures are to be issued, as such Indenture
and any supplemental indenture may be amended, supplemented or otherwise
modified from time to time.
"INDENTURE EVENT OF DEFAULT" means an "Event of Default" as defined
in the Indenture.
"INSTITUTIONAL TRUSTEE" means the Trustee meeting the eligibility
requirements set forth in Section 4.2.
"INTEREST" means any interest due on the Debentures including any
Additional Interest and Defaulted Interest.
"INVESTMENT COMPANY" means an investment company as defined in the
Investment Company Act.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"INVESTMENT COMPANY EVENT" has the meaning set forth in paragraph
4(a) of Annex I.
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"LEGAL ACTION" has the meaning set forth in Section 2.8(d).
"LIQUIDATION" has the meaning set forth in paragraph 3 of Annex I.
"LIQUIDATION DISTRIBUTION" has the meaning set forth in paragraph 3
of Annex I.
"MAJORITY IN LIQUIDATION AMOUNT OF THE SECURITIES" means Holder(s) of
outstanding Securities voting together as a single class or, as the context
may require, Holders of outstanding Capital Securities or Holders of
outstanding Common Securities voting separately as a class, who are the record
owners of more than 50% of the aggregate liquidation amount (including the
stated amount that would be paid on redemption, liquidation or otherwise, plus
accrued and unpaid Distributions to the date upon which the voting percentages
are determined) of all outstanding Securities of the relevant class.
"OFFICERS' CERTIFICATES" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
providing for it in this Declaration shall include:
(a) a statement that each officer signing the Certificate has read
the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"PAYING AGENT" has the meaning specified in Section 6.2.
"PAYMENT AMOUNT" has the meaning set forth in Section 5.1.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever
nature.
"PLACEMENT AGREEMENT" means the Placement Agreement relating to the
offering and sale of Capital Securities in the form of Exhibit C.
"PRIMARY TREASURY DEALER" has the meaning set forth in paragraph 4(a)
of Annex I.
"PROPERTY ACCOUNT" has the meaning set forth in Section 2.8(c).
"PRO RATA" has the meaning set forth in paragraph 8 of Annex I.
"QUORUM" means a majority of the Administrators or, if there are only
two Administrators, both of them.
"QUOTATION AGENT" has the meaning set forth in paragraph 4(a) of
Annex I.
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"REDEMPTION/DISTRIBUTION NOTICE" has the meaning set forth in
paragraph 4(e) of Annex I.
"REDEMPTION PRICE" has the meaning set forth in paragraph 4(a) of
Annex I.
"REGISTRAR" has the meaning set forth in Section 6.2.
"REFERENCE TREASURY DEALER" has the meaning set forth in paragraph
4(a) of Annex I.
"REFERENCE TREASURY DEALER QUOTATIONS" has the meaning set forth in
paragraph 4(a) of Annex I.
"RELEVANT TRUSTEE" has the meaning set forth in Section 4.4(a).
"REMAINING LIFE" has the meaning set forth in paragraph 4(a) of Annex
I.
"RESPONSIBLE OFFICER" means, with respect to the Institutional
Trustee, any officer within the Corporate Trust Office of the Institutional
Trustee, including any vice-president, any assistant vice-president, any
assistant secretary, the treasurer, any assistant treasurer, any trust officer
or other officer of the Corporate Trust Office of the Institutional Trustee
customarily performing functions similar to those performed by any of the
above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of that officer's knowledge of and familiarity with the particular
subject.
"RESTRICTED SECURITIES LEGEND" has the meaning set forth in Section
8.2(b).
"RULE 3a-5" means Rule 3a-5 under the Investment Company Act.
"RULE 3a-7" means Rule 3a-7 under the Investment Company Act.
"SECURITIES" means the Common Securities and the Capital Securities.
"SECURITIES ACT" means the Securities Act of 1933, as amended from
time to time or any successor legislation.
"SPECIAL EVENT" has the meaning set forth in paragraph 4(a) of Annex
I.
"SPECIAL REDEMPTION DATE" has the meaning set forth in paragraph 4(a)
of Annex I.
"SPECIAL REDEMPTION PRICE" has the meaning set forth in paragraph
4(a) of Annex I.
"SPONSOR" means First Community Bancorp, a California corporation, or
any successor entity in a merger, consolidation or amalgamation, in its
capacity as sponsor of the Trust.
"STATUTORY TRUST ACT" means Chapter 615 of Title 34 of the
Connecticut General Statutes, Sections 500, et seq. as may be amended from
time to time.
"SUCCESSOR ENTITY" has the meaning set forth in Section 2.14(b).
"SUCCESSOR INSTITUTIONAL TRUSTEE" has the meaning set forth in
Section 4.4(a).
"SUCCESSOR SECURITIES" has the meaning set forth in Section 2.14(b).
"SUPER MAJORITY" has the meaning set forth in paragraph 5(b) of Annex
I.
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"TAX EVENT" has the meaning set forth in paragraph 4(a) of Annex I.
"10% IN LIQUIDATION AMOUNT OF THE SECURITIES" means Holder(s) of
outstanding Securities voting together as a single class or, as the context
may require, Holders of outstanding Capital Securities or Holders of
outstanding Common Securities voting separately as a class, who are the record
owners of 10% or more of the aggregate liquidation amount (including the
stated amount that would be paid on redemption, liquidation or otherwise, plus
accrued and unpaid Distributions to the date upon which the voting percentages
are determined) of all outstanding Securities of the relevant class.
"TRANSFER AGENT" has the meaning set forth in Section 6.2.
"TREASURY RATE" has the meaning set forth in paragraph 4(a) of Annex
I.
"TREASURY REGULATIONS" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
"TRUSTEE" or "TRUSTEES" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with
the provisions hereof, and references herein to a Trustee or the Trustees
shall refer to such Person or Persons solely in their capacity as trustees
hereunder.
"TRUST PROPERTY" means (a) the Debentures, (b) any cash on deposit
in, or owing to, the Property Account and (c) all proceeds and rights in
respect of the foregoing and any other property and assets for the time being
held or deemed to be held by the Institutional Trustee pursuant to the trusts
of this Declaration.
"U.S. PERSON" means a United States Person as defined in Section
7701(a)(30) of the Code.
ARTICLE II
ORGANIZATION
SECTION 2.1. NAME. The Trust is named "First Community/CA Statutory
Trust I," as such name may be modified from time to time by the Administrators
following written notice to the Holders of the Securities. The Trust's
activities may be conducted under the name of the Trust or any other name
deemed advisable by the Administrators.
SECTION 2.2. OFFICE. The address of the principal office of the Trust
is ▇/▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ and Trust Company of Connecticut, National
Association, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
On at least 10 Business Days written notice to the Holders of the Securities,
the Administrators may designate another principal office, which shall be in a
state of the United States or in the District of Columbia.
SECTION 2.3. PURPOSE. The exclusive purposes and functions of the
Trust are (a) to issue and sell the Securities representing undivided
beneficial interests in the assets of the Trust, (b) to invest the gross
proceeds from such sale to acquire the Debentures, (c) to facilitate direct
investment in the assets of the Trust through issuance of the Common
Securities and the Capital Securities and (d) except as otherwise limited
herein, to engage in only those other activities necessary or incidental
thereto. The Trust shall not borrow money, issue debt or reinvest proceeds
derived from investments, pledge any of its assets, or
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otherwise undertake (or permit to be undertaken) any activity that would cause
the Trust not to be classified for United States federal income tax purposes
as a grantor trust.
SECTION 2.4. AUTHORITY. Except as specifically provided in this
Declaration, the Institutional Trustee shall have exclusive and complete
authority to carry out the purposes of the Trust. An action taken by a Trustee
in accordance with its powers shall constitute the act of and serve to bind
the Trust. In dealing with the Trustees acting on behalf of the Trust, no
Person shall be required to inquire into the authority of the Trustees to bind
the Trust. Persons dealing with the Trust are entitled to rely conclusively on
the power and authority of the Trustees as set forth in this Declaration. The
Administrators shall have only those ministerial duties set forth herein with
respect to accomplishing the purposes of the Trust and are not intended to be
trustees or fiduciaries with respect to the Trust or the Holders. The
Institutional Trustee shall have the right, but shall not be obligated except
as provided in Section 2.6, to perform those duties assigned to the
Administrators.
SECTION 2.5. TITLE TO PROPERTY OF THE TRUST. Except as provided in
Section 2.8 with respect to the Debentures and the Property Account or as
otherwise provided in this Declaration, legal title to all assets of the Trust
shall be vested in the Trust. The Holders shall not have legal title to any
part of the assets of the Trust, but shall have an undivided beneficial
interest in the assets of the Trust.
SECTION 2.6. POWERS AND DUTIES OF THE TRUSTEES AND THE ADMINISTRATORS.
(a) The Trustees and the Administrators shall conduct the affairs of
the Trust in accordance with the terms of this Declaration. Subject to the
limitations set forth in paragraph (b) of this Section, and in accordance with
the following provisions (i) and (ii), the Trustees and the Administrators
shall have the authority to enter into all transactions and agreements
determined by the Trustees to be appropriate in exercising the authority,
express or implied, otherwise granted to the Trustees or the Administrators,
as the case may be, under this Declaration, and to perform all acts in
furtherance thereof, including without limitation, the following:
(i) Each Administrator shall have the power and authority to
act on behalf of the Trust with respect to the following matters:
(A) the issuance and sale of the Securities;
(B) to cause the Trust to enter into, and to execute
and deliver on behalf of the Trust, such agreements as may be
necessary or desirable in connection with the purposes and
function of the Trust, including agreements with the Paying
Agent;
(C) ensuring compliance with the Securities Act,
applicable state securities or blue sky laws;
(D) the sending of notices (other than notices of
default), and other information regarding the Securities and
the Debentures to the Holders in accordance with this
Declaration;
(E) the consent to the appointment of a Paying Agent,
Transfer Agent and Registrar in accordance with this
Declaration, which consent shall not be unreasonably withheld
or delayed;
(F) execution and delivery of the Securities in
accordance with this Declaration;
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(G) execution and delivery of closing certificates,
pursuant to the Placement Agreement and the application for a
taxpayer identification number;
(H) unless otherwise determined by the Holders of a
Majority in liquidation amount of the Securities or as
otherwise required by the Statutory Trust Act, to execute on
behalf of the Trust (either acting alone or together with any
or all of the Administrators) any documents that the
Administrators have the power to execute pursuant to this
Declaration;
(I) the taking of any action incidental to the
foregoing as the Institutional Trustee may from time to time
determine is necessary or advisable to give effect to the
terms of this Declaration for the benefit of the Holders
(without consideration of the effect of any such action on any
particular Holder);
(J) to establish a record date with respect to all
actions to be taken hereunder that require a record date be
established, including Distributions, voting rights,
redemptions and exchanges, and to issue relevant notices to
the Holders of Capital Securities and Holders of Common
Securities as to such actions and applicable record dates; and
(K) to duly prepare and file all applicable tax
returns and tax information reports that are required to be
filed with respect to the Trust on behalf of the Trust.
(ii) As among the Trustees and the Administrators, the
Institutional Trustee shall have the power, duty and authority to act
on behalf of the Trust with respect to the following matters:
(A) the establishment of the Property Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal and any
other payments made in respect of the Debentures in the
Property Account;
(D) the distribution through the Paying Agent of
amounts owed to the Holders in respect of the Securities;
(E) the exercise of all of the rights, powers and
privileges of a holder of the Debentures;
(F) the sending of notices of default and other
information regarding the Securities and the Debentures to the
Holders in accordance with this Declaration;
(G) the distribution of the Trust Property in
accordance with the terms of this Declaration;
(H) to the extent provided in this Declaration, the
winding up of the affairs of and liquidation of the Trust and
the preparation, execution and filing of the certificate of
cancellation with the Secretary of State of the State of
Connecticut;
(I) after any Event of Default (PROVIDED that such
Event of Default is not by or with respect to the
Institutional Trustee) the taking of any action incidental to
the foregoing as the Institutional Trustee may from time to
time determine is necessary or
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advisable to give effect to the terms of this Declaration and
protect and conserve the Trust Property for the benefit of the
Holders (without consideration of the effect of any such
action on any particular Holder); and
(J) to take all action that may be necessary for the
preservation and the continuation of the Trust's valid
existence, rights, franchises and privileges as a statutory
trust under the laws of the State of Connecticut and of each
other jurisdiction in which such existence is necessary to
protect the limited liability of the Holders of the Capital
Securities or to enable the Trust to effect the purposes for
which the Trust was created.
(iii) The Institutional Trustee shall have the power and
authority to act on behalf of the Trust with respect to any of the
duties, liabilities, powers or the authority of the Administrators set
forth in Section 2.6(a)(i)(D), (E) and (F) herein but shall not have a
duty to do any such act unless specifically requested to do so in
writing by the Sponsor, and shall then be fully protected in acting
pursuant to such written request; and in the event of a conflict
between the action of the Administrators and the action of the
Institutional Trustee, the action of the Institutional Trustee shall
prevail.
(b) So long as this Declaration remains in effect, the Trust (or the
Trustees or Administrators acting on behalf of the Trust) shall not undertake
any business, activities or transaction except as expressly provided herein or
contemplated hereby. In particular, neither the Trustees nor the
Administrators may cause the Trust to (i) acquire any investments or engage in
any activities not authorized by this Declaration, (ii) sell, assign,
transfer, exchange, mortgage, pledge, set-off or otherwise dispose of any of
the Trust Property or interests therein, including to Holders, except as
expressly provided herein, (iii) take any action that would reasonably be
expected (x) to cause the Trust to fail or cease to qualify as a "grantor
trust" for United States federal income tax purposes or (y) to require the
Trust to register as an Investment Company under the Investment Company Act,
(iv) incur any indebtedness for borrowed money or issue any other debt or (v)
take or consent to any action that would result in the placement of a lien on
any of the Trust Property. The Institutional Trustee shall, at the sole cost
and expense of the Trust, defend all claims and demands of all Persons at any
time claiming any lien on any of the Trust Property adverse to the interest of
the Trust or the Holders in their capacity as Holders.
(c) In connection with the issuance and sale of the Capital
Securities, the Sponsor shall have the right and responsibility to assist the
Trust with respect to, or effect on behalf of the Trust, the following (and
any actions taken by the Sponsor in furtherance of the following prior to the
date of this Declaration are hereby ratified and confirmed in all respects):
(i) the taking of any action necessary to obtain an exemption
from the Securities Act;
(ii) the determination of the States in which to take
appropriate action to qualify or register for sale all or part of the
Capital Securities and the determination of any and all such acts,
other than actions which must be taken by or on behalf of the Trust,
and the advice to the Trustees of actions they must take on behalf of
the Trust, and the preparation for execution and filing of any
documents to be executed and filed by the Trust or on behalf of the
Trust, as the Sponsor deems necessary or advisable in order to comply
with the applicable laws of any such States in connection with the sale
of the Capital Securities;
(iii) the negotiation of the terms of, and the execution and
delivery of, the Placement Agreement providing for the sale of the
Capital Securities; and
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(iv) the taking of any other actions necessary or desirable to
carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the
Administrators and the Holders of a Majority in liquidation amount of the
Common Securities are authorized and directed to conduct the affairs of the
Trust and to operate the Trust so that the Trust will not (i) be deemed to be
an Investment Company required to be registered under the Investment Company
Act, and (ii) fail to be classified as a grantor trust for United States
federal income tax purposes. The Administrators and the Holders of a Majority
in liquidation amount of the Common Securities shall not take any action
inconsistent with the treatment of the Debentures as indebtedness of the
Debenture Issuer for United States federal income tax purposes. In this
connection, the Administrators and the Holders of a Majority in liquidation
amount of the Common Securities are authorized to take any action, not
inconsistent with applicable laws, the Certificate of Trust or this
Declaration, as amended from time to time, that each of the Administrators and
the Holders of a Majority in liquidation amount of the Common Securities
determines in their discretion to be necessary or desirable for such purposes.
(e) All expenses incurred by the Administrators or the Trustees
pursuant to this Section 2.6 shall be reimbursed by the Sponsor, and the
Trustees shall have no obligations with respect to such expenses.
(f) The assets of the Trust shall consist of the Trust Property.
(g) Legal title to all Trust Property shall be vested at all times in
the Institutional Trustee (in its capacity as such) and shall be held and
administered by the Institutional Trustee for the benefit of the Trust in
accordance with this Declaration.
SECTION 2.7. PROHIBITION OF ACTIONS BY THE TRUST AND THE TRUSTEES.
(a) The Trust shall not, and the Institutional Trustee shall cause
the Trust not to, engage in any activity other than as required or authorized
by this Declaration. In particular, the Trust shall not and the Institutional
Trustee shall cause the Trust not to:
(i) invest any proceeds received by the Trust from holding the
Debentures, but shall distribute all such proceeds to Holders of the
Securities pursuant to the terms of this Declaration and of the
Securities;
(ii) acquire any assets other than as expressly provided
herein;
(iii) possess Trust Property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness other than loans
represented by the Debentures;
(v) possess any power or otherwise act in such a way as to
vary the Trust assets or the terms of the Securities in any way
whatsoever other than as expressly provided herein;
(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Securities;
(vii) carry on any "trade or business" as that phrase is used
in the Code; or
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(viii) other than as provided in this Declaration (including
Annex I), (A) direct the time, method and place of exercising any trust
or power conferred upon the Debenture Trustee with respect to the
Debentures, (B) waive any past default that is waivable under the
Indenture, (C) exercise any right to rescind or annul any declaration
that the principal of all the Debentures shall be due and payable, or
(D) consent to any amendment, modification or termination of the
Indenture or the Debentures where such consent shall be required unless
the Trust shall have received an opinion of counsel to the effect that
such modification will not cause the Trust to cease to be classified as
a grantor trust for United States federal income tax purposes.
SECTION 2.8. POWERS AND DUTIES OF THE INSTITUTIONAL TRUSTEE.
(a) The legal title to the Debentures shall be owned by and held of
record in the name of the Institutional Trustee in trust for the benefit of
the Trust and the Holders of the Securities. The right, title and interest of
the Institutional Trustee to the Debentures shall vest automatically in each
Person who may hereafter be appointed as Institutional Trustee in accordance
with Section 4.4. Such vesting and cessation of title shall be effective
whether or not conveyancing documents with regard to the Debentures have been
executed and delivered.
(b) The Institutional Trustee shall not transfer its right, title and
interest in the Debentures to the Administrators.
(c) The Institutional Trustee shall:
(i) establish and maintain a segregated non-interest bearing
trust account (the "PROPERTY ACCOUNT") in the name of and under the
exclusive control of the Institutional Trustee, and maintained in the
Institutional Trustee's trust department, on behalf of the Holders of
the Securities and, upon the receipt of payments of funds made in
respect of the Debentures held by the Institutional Trustee, deposit
such funds into the Property Account and make payments, or cause the
Paying Agent to make payments, to the Holders of the Capital Securities
and Holders of the Common Securities from the Property Account in
accordance with Section 5.1. Funds in the Property Account shall be
held uninvested until disbursed in accordance with this Declaration;
(ii) engage in such ministerial activities as shall be
necessary or appropriate to effect the redemption of the Capital
Securities and the Common Securities to the extent the Debentures are
redeemed or mature; and
(iii) upon written notice of distribution issued by the
Administrators in accordance with the terms of the Securities, engage
in such ministerial activities as shall be necessary or appropriate to
effect the distribution of the Debentures to Holders of Securities upon
the occurrence of certain circumstances pursuant to the terms of the
Securities.
(d) The Institutional Trustee may bring or defend, pay, collect,
compromise, arbitrate, resort to legal action with respect to, or otherwise
adjust claims or demands of or against, the Trust ("LEGAL ACTION") which
arises out of or in connection with an Event of Default of which a Responsible
Officer of the Institutional Trustee has actual knowledge or arises out of the
Institutional Trustee's duties and obligations under this Declaration;
PROVIDED, HOWEVER, that if an Event of Default has occurred and is continuing
and such event is attributable to the failure of the Debenture Issuer to pay
interest or principal on the Debentures on the date such interest or principal
is otherwise payable (or in the case of redemption, on the redemption date),
then a Holder of the Capital Securities may directly institute a proceeding
for enforcement of payment to such Holder of the principal of or interest on
the Debentures having a principal amount equal to the aggregate liquidation
amount of the Capital Securities of such Holder (a
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"DIRECT ACTION") on or after the respective due date specified in the
Debentures. In connection with such Direct Action, the rights of the Holders
of the Common Securities will be subrogated to the rights of such Holder of
the Capital Securities to the extent of any payment made by the Debenture
Issuer to such Holder of the Capital Securities in such Direct Action;
PROVIDED, HOWEVER, that no Holder of the Common Securities may exercise such
right of subrogation so long as an Event of Default with respect to the
Capital Securities has occurred and is continuing.
(e) The Institutional Trustee shall continue to serve as a Trustee
until either:
(i) the Trust has been completely liquidated and the proceeds
of the liquidation distributed to the Holders of the Securities
pursuant to the terms of the Securities and this Declaration; or
(ii) a Successor Institutional Trustee has been appointed and
has accepted that appointment in accordance with Section 4.4.
(f) The Institutional Trustee shall have the legal power to exercise
all of the rights, powers and privileges of a Holder of the Debentures under
the Indenture and, if an Event of Default occurs and is continuing, the
Institutional Trustee may, for the benefit of Holders of the Securities,
enforce its rights as holder of the Debentures subject to the rights of the
Holders pursuant to this Declaration (including Annex I) and the terms of the
Securities.
The Institutional Trustee must exercise the powers set forth in this
Section 2.8 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 2.3, and the Institutional Trustee shall not take
any action that is inconsistent with the purposes and functions of the Trust
set out in Section 2.3.
SECTION 2.9. CERTAIN DUTIES AND RESPONSIBILITIES OF THE TRUSTEES AND
ADMINISTRATORS.
(a) The Institutional Trustee, before the occurrence of any Event of
Default and after the curing or waiving of all such Events of Default that may
have occurred, shall undertake to perform only such duties as are specifically
set forth in this Declaration and no implied covenants shall be read into this
Declaration against the Institutional Trustee. In case an Event of Default has
occurred (that has not been cured or waived pursuant to Section 6.7), the
Institutional Trustee shall exercise such of the rights and powers vested in
it by this Declaration, and use the same degree of care and skill in their
exercise, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.
(b) The duties and responsibilities of the Trustees and the
Administrators shall be as provided by this Declaration. Notwithstanding the
foregoing, no provision of this Declaration shall require the Trustees or
Administrators to expend or risk their own funds or otherwise incur any
financial liability in the performance of any of their duties hereunder, or in
the exercise of any of their rights or powers if it shall have reasonable
grounds to believe that repayment of such funds or adequate protection against
such risk of liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Declaration relating to the
conduct or affecting the liability of or affording protection to the Trustees
or Administrators shall be subject to the provisions of this Article. Nothing
in this Declaration shall be construed to relieve an Administrator or Trustee
from liability for its own negligent failure to act, or its own willful
misconduct. To the extent that, at law or in equity, a Trustee or an
Administrator has duties and liabilities relating to the Trust or to the
Holders, such Trustee or Administrator shall not be liable to the Trust or to
any Holder for such Trustee's or Administrator's good faith reliance on the
provisions of this Declaration. The provisions of this Declaration, to the
extent that they restrict the duties and liabilities of the Administrators or
the Trustees otherwise existing at law or in
13
equity, are agreed by the Sponsor and the Holders to replace such other duties
and liabilities of the Administrators or the Trustees.
(c) All payments made by the Institutional Trustee or a Paying Agent
in respect of the Securities shall be made only from the revenue and proceeds
from the Trust Property and only to the extent that there shall be sufficient
revenue or proceeds from the Trust Property to enable the Institutional
Trustee or a Paying Agent to make payments in accordance with the terms
hereof. Each Holder, by its acceptance of a Security, agrees that it will look
solely to the revenue and proceeds from the Trust Property to the extent
legally available for distribution to it as herein provided and that the
Trustees and the Administrators are not personally liable to it for any amount
distributable in respect of any Security or for any other liability in respect
of any Security. This Section 2.9(c) does not limit the liability of the
Trustees expressly set forth elsewhere in this Declaration.
(d) The Institutional Trustee shall not be liable for its own acts or
omissions hereunder except as a result of its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) the Institutional Trustee shall not be liable for any
error of judgment made in good faith by an Authorized Officer of the
Institutional Trustee, unless it shall be proved that the Institutional
Trustee was negligent in ascertaining the pertinent facts;
(ii) the Institutional Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith
in accordance with the direction of the Holders of not less than a
Majority in liquidation amount of the Capital Securities or the Common
Securities, as applicable, relating to the time, method and place of
conducting any proceeding for any remedy available to the Institutional
Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under this Declaration;
(iii) the Institutional Trustee's sole duty with respect to
the custody, safekeeping and physical preservation of the Debentures
and the Property Account shall be to deal with such property in a
similar manner as the Institutional Trustee deals with similar property
for its fiduciary accounts generally, subject to the protections and
limitations on liability afforded to the Institutional Trustee under
this Declaration;
(iv) the Institutional Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree
in writing with the Sponsor; and money held by the Institutional
Trustee need not be segregated from other funds held by it except in
relation to the Property Account maintained by the Institutional
Trustee pursuant to Section 2.8(c)(i) and except to the extent
otherwise required by law; and
(v) the Institutional Trustee shall not be responsible for
monitoring the compliance by the Administrators or the Sponsor with
their respective duties under this Declaration, nor shall the
Institutional Trustee be liable for any default or misconduct of the
Administrators or the Sponsor.
SECTION 2.10. CERTAIN RIGHTS OF INSTITUTIONAL TRUSTEE. Subject to the
provisions of Section 2.9:
(a) the Institutional Trustee may conclusively rely and shall fully
be protected in acting or refraining from acting in good faith upon any
resolution, opinion of counsel, certificate, written representation of a
Holder or transferee, certificate of auditors or any other certificate,
statement,
14
instrument, opinion, report, notice, request, direction, consent, order,
appraisal, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed, sent
or presented by the proper party or parties;
(b) if (i) in performing its duties under this Declaration, the
Institutional Trustee is required to decide between alternative courses of
action, (ii) in construing any of the provisions of this Declaration, the
Institutional Trustee finds the same ambiguous or inconsistent with any other
provisions contained herein, or (iii) the Institutional Trustee is unsure of
the application of any provision of this Declaration, then, except as to any
matter as to which the Holders of Capital Securities are entitled to vote
under the terms of this Declaration, the Institutional Trustee may deliver a
notice to the Sponsor requesting the Sponsor's written instructions as to the
course of action to be taken and the Institutional Trustee shall take such
action, or refrain from taking such action, as the Institutional Trustee shall
be instructed in writing, in which event the Institutional Trustee shall have
no liability except for its own negligence or willful misconduct;
(c) any direction or act of the Sponsor or the Administrators
contemplated by this Declaration shall be sufficiently evidenced by an
Officers' Certificate;
(d) whenever in the administration of this Declaration, the
Institutional Trustee shall deem it desirable that a matter be proved or
established before undertaking, suffering or omitting any action hereunder,
the Institutional Trustee (unless other evidence is herein specifically
prescribed) may request and conclusively rely upon an Officers' Certificate as
to factual matters which, upon receipt of such request, shall be promptly
delivered by the Sponsor or the Administrators;
(e) the Institutional Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any financing
or continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(f) the Institutional Trustee may consult with counsel of its
selection (which counsel may be counsel to the Sponsor or any of its
Affiliates) and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon and in
accordance with such advice; the Institutional Trustee shall have the right at
any time to seek instructions concerning the administration of this
Declaration from any court of competent jurisdiction;
(g) the Institutional Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration at the
request or direction of any of the Holders pursuant to this Declaration,
unless such Holders shall have offered to the Institutional Trustee security
or indemnity reasonably satisfactory to it against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction; PROVIDED, that nothing contained in this Section 2.10(g) shall be
taken to relieve the Institutional Trustee, subject to Section 2.9(b), upon
the occurrence of an Event of Default, to exercise such of the rights and
powers vested in it by this Declaration, and use the same degree of care and
skill in their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs;
(h) the Institutional Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other
paper or document, unless requested in writing to do so by one or more
Holders, but the Institutional Trustee may make such further inquiry or
investigation into such facts or matters as it may see fit;
15
(i) the Institutional Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through its
agents or attorneys and the Institutional Trustee shall not be responsible for
any misconduct or negligence on the part of or for the supervision of, any
such agent or attorney appointed with due care by it hereunder;
(j) whenever in the administration of this Declaration the
Institutional Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action hereunder
the Institutional Trustee (i) may request instructions from the Holders of the
Capital Securities which instructions may only be given by the Holders of the
same proportion in liquidation amount of the Capital Securities as would be
entitled to direct the Institutional Trustee under the terms of the Capital
Securities in respect of such remedy, right or action, (ii) may refrain from
enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be fully protected in acting in
accordance with such instructions;
(k) except as otherwise expressly provided in this Declaration, the
Institutional Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Declaration;
(l) when the Institutional Trustee incurs expenses or renders
services in connection with a Bankruptcy Event, such expenses (including the
fees and expenses of its counsel) and the compensation for such services are
intended to constitute expenses of administration under any bankruptcy law or
law relating to creditors rights generally;
(m) the Institutional Trustee shall not be charged with knowledge of
an Event of Default unless a Responsible Officer of the Institutional Trustee
obtains actual knowledge of such event or the Institutional Trustee receives
written notice of such event from any Holder, the Sponsor or the Debenture
Trustee;
(n) any action taken by the Institutional Trustee or its agents
hereunder shall bind the Trust and the Holders of the Securities, and the
signature of the Institutional Trustee or its agents alone shall be sufficient
and effective to perform any such action and no third party shall be required
to inquire as to the authority of the Institutional Trustee to so act or as to
its compliance with any of the terms and provisions of this Declaration, both
of which shall be conclusively evidenced by the Institutional Trustee's or its
agent's taking such action; and
(o) no provision of this Declaration shall be deemed to impose any
duty or obligation on the Institutional Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in
any jurisdiction in which it shall be illegal, or in which the Institutional
Trustee shall be unqualified or incompetent in accordance with applicable law,
to perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Institutional
Trustee shall be construed to be a duty.
SECTION 2.11. EXECUTION OF DOCUMENTS. Unless otherwise determined in
writing by the Institutional Trustee, and except as otherwise required by the
Statutory Trust Act, the Institutional Trustee, or any one or more of the
Administrators, as the case may be, is authorized to execute on behalf of the
Trust any documents that the Trustees or the Administrators, as the case may
be, have the power and authority to execute pursuant to Section 2.6.
SECTION 2.12. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained in this Declaration and the Securities shall be taken
as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as
to the value or condition of the property of the Trust or any part thereof.
The Trustees make no representations as to the validity or sufficiency of this
Declaration, the Debentures or the Securities.
16
SECTION 2.13. DURATION OF TRUST. The Trust, unless earlier dissolved
pursuant to the provisions of Article VII hereof, shall be in existence for 35
years from the Closing Date.
SECTION 2.14. MERGERS.
(a) The Trust may not consolidate, amalgamate, merge with or into, or
be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except as
described in this Section 2.14(b) and (c).
(b) The Trust may, with the consent of the Institutional Trustee and
without the consent of the Holders of the Capital 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) if the Trust is not the surviving entity, such successor
entity (the "SUCCESSOR ENTITY") either:
(A) expressly assumes all of the obligations of the
Trust under the Securities; or
(B) substitutes for the Securities other securities
having substantially the same terms as the Securities (the
"SUCCESSOR SECURITIES") so that the Successor Securities rank
the same as the Securities rank with respect to Distributions
and payments upon Liquidation, redemption and otherwise;
(ii) the Sponsor expressly appoints a trustee of the Successor
Entity that possesses the same powers and duties as the Institutional
Trustee as the Holder of the Debentures;
(iii) such merger, consolidation, amalgamation or replacement
does not adversely affect the rights, preferences and privileges of the
Holders of the Securities (including any Successor Securities) in any
material respect (other than with respect to any dilution of such
Holders' interests in the Successor Entity as a result of such merger,
consolidation, amalgamation or replacement);
(iv) the Institutional Trustee receives written confirmation
from ▇▇▇▇▇'▇ Investor Services, Inc. or any other nationally recognized
statistical rating organization that rates securities issued by the
initial purchase of the Capital Securities that it will not reduce or
withdraw the rating of any such securities because of such merger,
conversion, consolidation, amalgamation or replacement;
(v) such Successor Entity has a purpose substantially
identical to that of the Trust;
(vi) prior to such merger, consolidation, amalgamation or
replacement, the Trust has received an opinion of a nationally
recognized independent counsel to the Trust experienced in such matters
to the effect that:
(A) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences
and privileges of the Holders of the Securities (including any
Successor Securities) in any material respect (other than with
respect to any dilution of the Holders' interest in the
Successor Entity);
(B) following such merger, consolidation,
amalgamation or replacement, neither the Trust nor the
Successor Entity will be required to register as an Investment
Company; and
17
(C) following such merger, consolidation,
amalgamation or replacement, the Trust (or the Successor
Entity) will continue to be classified as a grantor trust for
United States federal income tax purposes;
(vii) the Sponsor guarantees the obligations of such Successor
Entity under the Successor Securities at least to the extent provided
by the Guarantee;
(viii) the Sponsor owns 100% of the common securities of any
Successor Entity; and
(ix) prior to such merger, consolidation, amalgamation or
replacement, the Institutional Trustee shall have received an Officers'
Certificate of the Administrators and an opinion of counsel, each to
the effect that all conditions precedent under this Section 2.14(b) to
such transaction have been satisfied.
(c) Notwithstanding Section 2.14(b), the Trust shall not, except with
the consent of Holders of 100% in aggregate liquidation amount of the
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, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as
other than a grantor trust for United States federal income tax purposes.
ARTICLE III
SPONSOR
SECTION 3.1. SPONSOR'S PURCHASE OF COMMON SECURITIES. On the Closing
Date, the Sponsor will purchase all of the Common Securities issued by the
Trust in an amount at least equal to 3% of the capital of the Trust, at the
same time as the Capital Securities are sold.
SECTION 3.2. RESPONSIBILITIES OF THE SPONSOR. In connection with the
issue and sale of the Capital Securities, the Sponsor shall have the exclusive
right and responsibility to engage in, or direct the Administrators to engage
in, the following activities:
(a) to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Capital Securities and to do
any and all such acts, other than actions which must be taken by the Trust,
and advise the Trust of actions it must take, and prepare for execution and
filing any documents to be executed and filed by the Trust, as the Sponsor
deems necessary or advisable in order to comply with the applicable laws of
any such States; and
(b) to negotiate the terms of and/or execute on behalf of the Trust,
the Placement Agreement, and other related agreements providing for the sale
of the Capital Securities.
SECTION 3.3. EXPENSES. In connection with the offering, sale and
issuance of the Debentures to the Institutional Trustee and in connection with
the sale of the Securities by the Trust, the Sponsor, in its capacity as
Debenture Issuer, shall:
(a) pay all costs and expenses relating to the offering, sale and
issuance of the Debentures, including compensation of the Debenture Trustee
under the Indenture in accordance with the provisions of the Indenture;
(b) be responsible for and shall pay all debts and obligations (other
than with respect to the Securities) and all costs and expenses of the Trust
(including, but not limited to, costs and expenses
18
relating to the organization, maintenance and dissolution of the Trust), the
offering, sale and issuance of the Securities (including fees to the placement
agents in connection therewith), the fees and expenses (including reasonable
counsel fees and expenses) of the Institutional Trustee and the
Administrators, the costs and expenses relating to the operation of the Trust,
including, without limitation, costs and expenses of accountants, attorneys,
statistical or bookkeeping services, expenses for printing and engraving and
computing or accounting equipment, Paying Agents, Registrars, Transfer Agents,
duplicating, travel and telephone and other telecommunications expenses and
costs and expenses incurred in connection with the acquisition, financing, and
disposition of Trust assets and the enforcement by the Institutional Trustee
of the rights of the Holders; and
(c) to pay any and all taxes (other than United States withholding
taxes attributable to the Trust or its assets) and all liabilities, costs and
expenses with respect to such taxes of the Trust.
The Sponsor's obligations under this Section 3.3 shall be for the
benefit of, and shall be enforceable by, any Person to whom such debts,
obligations, costs, expenses and taxes are owed (a "CREDITOR") whether or not
such Creditor has received notice hereof. Any such Creditor may enforce the
Sponsor's obligations under this Section 3.3 directly against the Sponsor and
the Sponsor irrevocably waives any right or remedy to require that any such
Creditor take any action against the Trust or any other Person before
proceeding against the Sponsor. The Sponsor agrees to execute such additional
agreements as may be necessary or desirable in order to give full effect to
the provisions of this Section 3.3.
SECTION 3.4. RIGHT TO PROCEED. The Sponsor acknowledges the rights of
Holders to institute a Direct Action as set forth in Section 2.8(d)hereto.
ARTICLE IV
TRUSTEES AND ADMINISTRATORS
SECTION 4.1. NUMBER OF TRUSTEES. The number of Trustees initially
shall be one (1), and:
(a) at any time before the issuance of any Securities, the Sponsor
may, by written instrument, increase or decrease the number of Trustees; and
(b) after the issuance of any Securities, the number of Trustees may
be increased or decreased by vote of the Holders of a Majority in liquidation
amount of the Capital Securities voting as a class at a meeting of the Holders
of the Capital Securities; PROVIDED, HOWEVER, that there shall always be one
Trustee who shall be the Institutional Trustee.
SECTION 4.2. INSTITUTIONAL TRUSTEE; ELIGIBILITY.
(a) There shall at all times be one Trustee which shall act as
Institutional Trustee which shall:
(i) not be an Affiliate of the Sponsor;
(ii) not offer or provide credit or credit enhancement to the
Trust; and
(iii) be a banking corporation or trust company organized and
doing business under the laws of the United States of America or any
state thereof or the District of Columbia, authorized under such laws
to exercise corporate trust powers, having a combined capital and
surplus of at least 50 million U.S. dollars ($50,000,000), and subject
to supervision or examination by Federal, state, or District of
Columbia authority. If such corporation publishes reports of condition
at least annually, pursuant to law or to the requirements of the
supervising or
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examining authority referred to above, then for the purposes of this
Section 4.2(a)(iii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published.
(b) If at any time the Institutional Trustee shall cease to be
eligible to so act under Section 4.2(a), the Institutional Trustee shall
immediately resign in the manner and with the effect set forth in Section
4.4(a).
(c) The initial Institutional Trustee shall be State Street Bank and
Trust Company of Connecticut, National Association.
SECTION 4.3. ADMINISTRATORS. Each Administrator shall be a U.S.
Person, 21 years of age or older and authorized to bind the Sponsor. The
initial Administrators shall be ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇. There shall
at all times be at least one Administrator. Except where a requirement for
action by a specific number of Administrators is expressly set forth in this
Declaration and except with respect to any action the taking of which is the
subject of a meeting of the Administrators, any action required or permitted
to be taken by the Administrators may be taken by, and any power of the
Administrators may be exercised by, or with the consent of, any one such
Administrator.
SECTION 4.4. APPOINTMENT, REMOVAL AND RESIGNATION OF TRUSTEES AND
ADMINISTRATORS.
(a) Notwithstanding anything to the contrary in this Declaration, no
resignation or removal of any Trustee (the "RELEVANT TRUSTEE") and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of this Section 4.4.
Subject to the immediately preceding paragraph, a Relevant Trustee
may resign at any time by giving written notice thereof to the Holders of the
Securities and by appointing a successor Relevant Trustee. Upon the
resignation of the Institutional Trustee, the Institutional Trustee shall
appoint a successor by requesting from at least three Persons meeting the
eligibility requirements, its expenses and charges to serve as the successor
Institutional Trustee on a form provided by the Administrators, and selecting
the Person who agrees to the lowest expense and charges (the "SUCCESSOR
INSTITUTIONAL TRUSTEE"). If the instrument of acceptance by the successor
Relevant Trustee required by this Section 4.4 shall not have been delivered to
the Relevant Trustee within 60 days after the giving of such notice of
resignation or delivery of the instrument of removal, the Relevant Trustee may
petition, at the expense of the Trust, any Federal, state or District of
Columbia court of competent jurisdiction for the appointment of a successor
Relevant Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper, appoint a Relevant Trustee. The Institutional
Trustee shall have no liability for the selection of such successor pursuant
to this Section 4.4.
The Institutional Trustee may be removed by the act of the Holders of
a Majority in liquidation amount of the Capital Securities, delivered to the
Relevant Trustee (in its individual capacity and on behalf of the Trust) if an
Event of Default shall have occurred and be continuing. If any Trustee shall
be so removed, the Holders of Capital Securities, by act of the Holders of a
Majority in liquidation amount of the Capital Securities then outstanding
delivered to the Relevant Trustee, shall promptly appoint a successor Relevant
Trustee or Trustees, and such successor Trustee shall comply with the
applicable requirements of this Section 4.4. If no successor Relevant Trustee
shall have been so appointed by the Holders of a Majority in liquidation
amount of the Capital Securities and accepted appointment in the manner
required by this Section 4.4, within 30 days after delivery of an instrument
of removal, any Holder who has been a Holder of the Securities for at least 6
months may, on behalf of himself and all others similarly situated, petition
any Federal, state or District of Columbia court of competent
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jurisdiction for the appointment of a successor Relevant Trustee. Such court
may thereupon, after prescribing such notice, if any, as it may deem proper,
appoint a successor Relevant Trustee or Trustees.
The Institutional Trustee shall give notice of each resignation and
each removal of a Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 13.1(d) and shall give notice to the
Sponsor. Each notice shall include the name of the successor Relevant Trustee
and the address of its Corporate Trust Office if it is the Institutional
Trustee.
(b) In case of the appointment hereunder of a successor Relevant
Trustee, the retiring Relevant Trustee and each successor Relevant Trustee
with respect to the Trust Securities shall execute and deliver an amendment
hereto wherein each successor Relevant Trustee shall accept such appointment
and which (i) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Relevant Trustee
all the rights, powers, trusts and duties of the retiring Relevant Trustee
with respect to the Securities and the Trust and (ii) shall add to or change
any of the provisions of this Declaration as shall be necessary to provide for
or facilitate the administration of the Trust by more than one Relevant
Trustee, it being understood that nothing herein or in such amendment shall
constitute such Relevant Trustees co-trustees and upon the execution and
delivery of such amendment the resignation or removal of the retiring Relevant
Trustee shall become effective to the extent provided therein and each such
successor Relevant Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Relevant Trustee; but, on request of the Trust of any successor Relevant
Trustee such retiring Relevant Trustee shall duly assign, transfer and deliver
to such successor Relevant Trustee all Trust Property, all proceeds thereof
and money held by such retiring Relevant Trustee hereunder with respect to the
Securities and the Trust.
(c) No Institutional Trustee shall be liable for the acts or
omissions to act of any Successor Institutional Trustee.
(d) The Holders of the Capital Securities will have no right to vote
to appoint, remove or replace the Administrators, which voting rights are
vested exclusively in the Holder of the Common Securities.
SECTION 4.5. VACANCIES AMONG TRUSTEES. If a Trustee ceases to hold
office for any reason and the number of Trustees is not reduced pursuant to
Section 4.1, or if the number of Trustees is increased pursuant to Section
4.1, a vacancy shall occur. A resolution certifying the existence of such
vacancy by the Trustees or, if there are more than two, a majority of the
Trustees shall be conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance with Section
4.4.
SECTION 4.6. EFFECT OF VACANCIES. The death, resignation, retirement,
removal, bankruptcy, dissolution, liquidation, incompetence or incapacity to
perform the duties of a Trustee shall not operate to dissolve, terminate or
annul the Trust or terminate this Declaration. Whenever a vacancy in the
number of Trustees shall occur, until such vacancy is filled by the
appointment of a Trustee in accordance with Section 4.4, the Institutional
Trustee shall have all the powers granted to the Trustees and shall discharge
all the duties imposed upon the Trustees by this Declaration.
SECTION 4.7. MEETINGS OF THE TRUSTEES AND THE ADMINISTRATORS.
Meetings of the Trustees or the Administrators shall be held from time to time
upon the call of any Trustee or Administrator, as applicable. Regular meetings
of the Trustees and the Administrators, respectively, may be held in person in
the United States or by telephone, at a place (if applicable) and time fixed
by resolution of the Trustees or the Administrators, as applicable. Notice of
any in-person meetings of the Trustees or the Administrators shall be hand
delivered or otherwise delivered in writing (including by facsimile, with a
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hard copy by overnight courier) not less than 48 hours before such meeting.
Notice of any telephonic meetings of the Trustees or the Administrators or any
committee thereof shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than
24 hours before a meeting. Notices shall contain a brief statement of the
time, place and anticipated purposes of the meeting. The presence (whether in
person or by telephone) of a Trustee or an Administrator, as the case may be,
at a meeting shall constitute a waiver of notice of such meeting except where
a Trustee or an Administrator, as the case may be, attends a meeting for the
express purpose of objecting to the transaction of any activity on the grounds
that the meeting has not been lawfully called or convened. Unless provided
otherwise in this Declaration, any action of the Trustees or the
Administrators, as the case may be, may be taken at a meeting by vote of a
majority of the Trustees or the Administrators present (whether in person or
by telephone) and eligible to vote with respect to such matter, provided that
a Quorum is present, or without a meeting by the unanimous written consent of
the Trustees or the Administrators. Meetings of the Trustees and the
Administrators together shall be held from time to time upon the call of any
Trustee or Administrator.
SECTION 4.8. DELEGATION OF POWER.
(a) Any Administrator may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 that
is a U.S. Person his or her power for the purpose of executing any documents
contemplated in Section 2.6; and
(b) the Administrators 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 Administrators
or otherwise as the Administrators may deem expedient, to the extent such
delegation is not prohibited by applicable law or contrary to the provisions
of the Trust, as set forth herein.
SECTION 4.9. CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS. Any
Person into which the Institutional Trustee may be merged or converted or with
which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which the Institutional Trustee shall be a
party, or any Person succeeding to all or substantially all the corporate
trust business of the Institutional Trustee shall be the successor of the
Institutional Trustee hereunder, provided such Person shall be otherwise
qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto.
ARTICLE V
DISTRIBUTIONS
SECTION 5.1. DISTRIBUTIONS. Holders shall receive Distributions in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Capital Securities and the Common
Securities in accordance with the preferences set forth in their respective
terms. If and to the extent that the Debenture Issuer makes a payment of
Interest (or any principal on the Debentures held by the Institutional
Trustee) (the amount of any such payment being a "PAYMENT AMOUNT"), the
Institutional Trustee shall and is directed, to the extent funds are available
for that purpose, to make a distribution (a "DISTRIBUTION") of the Payment
Amount to Holders.
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ARTICLE VI
ISSUANCE OF SECURITIES
SECTION 6.1. GENERAL PROVISIONS REGARDING SECURITIES.
(a) The Administrators shall, on behalf of the Trust, issue one
series of capital securities substantially in the form of Exhibit A-1
representing undivided beneficial interests in the assets of the Trust having
such terms as are set forth in Annex I (the "Capital Securities") and one
series of common securities representing undivided beneficial interests in the
assets of the Trust having such terms as are set forth in Annex I (the "Common
Securities"). The Trust shall issue no securities or other interests in the
assets of the Trust other than the Capital Securities and the Common
Securities. The Capital Securities rank PARI PASSU to, and payment thereon
shall be made Pro Rata with, the Common Securities except that, where an Event
of Default has occurred and is continuing, the rights of Holders of the Common
Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to
payment of the Holders of the Capital Securities as set forth in Annex I.
(b) The Certificates shall be signed on behalf of the Trust by one or
more Administrators. Such signature shall be the facsimile or manual signature
of any Administrator. In case any Administrator of the Trust who shall have
signed any of the Securities shall cease to be such Administrator before the
Certificates so signed shall be delivered by the Trust, such Certificates
nevertheless may be delivered as though the person who signed such
Certificates had not ceased to be such Administrator, and any Certificate may
be signed on behalf of the Trust by such persons who, at the actual date of
execution of such Security, shall be an Administrator of the Trust, although
at the date of the execution and delivery of the Declaration any such person
was not such an Administrator. A Capital Security shall not be valid until
authenticated by the manual signature of an Authorized Officer of the
Institutional Trustee. Such signature shall be conclusive evidence that the
Capital Security has been authenticated under this Declaration. Upon written
order of the Trust signed by one Administrator, the Institutional Trustee
shall authenticate the Capital Securities for original issue. The
Institutional Trustee may appoint an authenticating agent that is a U.S.
Person acceptable to the Trust to authenticate the Capital Securities. A
Common Security need not be so authenticated.
(c) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and
shall not constitute a loan to the Trust.
(d) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable.
(e) Every Person, by virtue of having become a Holder in accordance
with the terms of this Declaration, shall be deemed to have expressly assented
and agreed to the terms of, and shall be bound by, this Declaration and the
Guarantee.
SECTION 6.2. PAYING AGENT, TRANSFER AGENT AND REGISTRAR. The Trust
shall maintain in Hartford, Connecticut, an office or agency where the Capital
Securities may be presented for payment ("PAYING AGENT"), and an office or
agency where Securities may be presented for registration of transfer (the
"TRANSFER AGENT"). The Trust shall keep or cause to be kept at such office or
agency a register for the purpose of registering Securities, transfers and
exchanges of Securities, such register to be held by a registrar (the
"REGISTRAR"). The Administrators may appoint the Paying Agent, the Registrar,
the Transfer Agent and may appoint one or more additional Paying Agents or one
or more co-Registrars, or one or more co-Transfer Agents in such other
locations as it shall determine. The term "PAYING AGENT" includes any
additional paying agent, the term "REGISTRAR" includes any additional
registrar or co-Registrar and the
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term "TRANSFER AGENT" includes any additional transfer agent. The
Administrators may change any Paying Agent without prior notice to any Holder.
The Administrators shall notify the Institutional Trustee of the name and
address of any Paying Agent, Transfer Agent and Registrar not a party to this
Declaration. The Administrators hereby appoint the Institutional Trustee to
act as Paying Agent, Transfer Agent and Registrar for the Capital Securities
and the Common Securities. The Institutional Trustee or any of its Affiliates
in the United States may act as Paying Agent, Transfer Agent or Registrar.
SECTION 6.3. FORM AND DATING. The Capital Securities and the
Institutional Trustee's certificate of authentication thereon shall be
substantially in the form of Exhibit A-1, and the Common Securities shall be
substantially in the form of Exhibit A-2, each of which is hereby incorporated
in and expressly made a part of this Declaration. Certificates may be typed,
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrators, as conclusively evidenced by
their execution thereof. The Securities may have letters, numbers, notations
or other marks of identification or designation and such legends or
endorsements required by law, stock exchange rule, agreements to which the
Trust is subject if any, or usage (provided that any such notation, legend or
endorsement is in a form acceptable to the Sponsor). The Trust at the
direction of the Sponsor shall furnish any such legend not contained in
Exhibit A-1 to the Institutional Trustee in writing. Each Capital Security
shall be dated the date of its authentication. The terms and provisions of the
Securities set forth in Annex I and the forms of Securities set forth in
Exhibits A-1 and A-2 are part of the terms of this Declaration and to the
extent applicable, the Institutional Trustee, the Administrators and the
Sponsor, by their execution and delivery of this Declaration, expressly agree
to such terms and provisions and to be bound thereby. Capital Securities will
be issued only in blocks having a stated liquidation amount of not less than
$500,000 and any multiple of $1,000 in excess thereof.
The Capital Securities are being offered and sold by the Trust
pursuant to the Placement Agreement in definitive, registered form without
coupons with the Restricted Securities Legend.
SECTION 6.4. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.
If:
(a) any mutilated Certificates should be surrendered to the
Registrar, or if the Registrar shall receive evidence to its satisfaction of
the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Registrar, the Administrators and
the Institutional Trustee such security or indemnity as may be required by
them to keep each of them harmless;
then, in the absence of notice that such Certificate shall have been acquired
by a protected purchaser, an Administrator on behalf of the Trust shall
execute (and in the case of a Capital Security Certificate, the Institutional
Trustee shall authenticate) and deliver, in exchange for or in lieu of any
such mutilated, destroyed, lost or stolen Certificate, a new Certificate of
like denomination. In connection with the issuance of any new Certificate
under this Section 6.4, the Registrar or the Administrators may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith. Any duplicate Certificate issued
pursuant to this Section shall constitute conclusive evidence of an ownership
interest in the relevant Securities, as if originally issued, whether or not
the lost, stolen or destroyed Certificate shall be found at any time.
SECTION 6.5. TEMPORARY SECURITIES. Until definitive Securities are
ready for delivery, the Administrators may prepare and, in the case of the
Capital Securities, the Institutional Trustee shall authenticate temporary
Securities. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Administrators consider
appropriate for temporary Securities.
24
Without unreasonable delay, the Administrators shall prepare and, in the case
of the Capital Securities, the Institutional Trustee shall authenticate
definitive Securities in exchange for temporary Securities.
SECTION 6.6. CANCELLATION. The Administrators at any time may deliver
Securities to the Institutional Trustee for cancellation. The Registrar shall
forward to the Institutional Trustee any Securities surrendered to it for
registration of transfer, redemption or payment. The Institutional Trustee
shall promptly cancel all Securities surrendered for registration of transfer,
payment replacement or cancellation and shall dispose of such canceled
Securities as the Administrators direct. The Administrators may not issue new
Securities to replace Securities that have been paid or that have been
delivered to the Institutional Trustee for cancellation.
SECTION 6.7. RIGHTS OF HOLDERS; WAIVERS OF PAST DEFAULTS.
(a) The legal title to the Trust Property is vested exclusively in
the Institutional Trustee (in its capacity as such) in accordance with Section
2.5, and the Holders shall not have any right or title therein other than the
undivided beneficial interest in the assets of the Trust conferred by their
Securities and they shall have no right to call for any partition or division
of property, profits or rights of the Trust except as described below. The
Securities shall be personal property giving only the rights specifically set
forth therein and in this Declaration. The Securities shall have no preemptive
or similar rights.
(b) For so long as any Capital Securities remain outstanding, if upon
an Indenture Event of Default, the Debenture Trustee fails or the holders of
not less than 25% in principal amount of the outstanding Debentures fail to
declare the principal of all of the Debentures to be immediately due and
payable, the Holders of a Majority in liquidation amount of the Capital
Securities then outstanding shall have the right to make such declaration by a
notice in writing to the Institutional Trustee, the Sponsor and the Debenture
Trustee.
At any time after a declaration of acceleration with respect to the
Debentures has been made and before a judgment or decree for payment of the
money due has been obtained by the Debenture Trustee as provided in the
Indenture, if the Institutional Trustee fails to annul any such declaration
and waive such default, the Holders of a Majority in liquidation amount of the
Capital Securities, by written notice to the Institutional Trustee, the
Sponsor and the Debenture Trustee, may rescind and annul such declaration and
its consequences if:
(i) the Debenture Issuer has paid or deposited with the
Debenture Trustee a sum sufficient to pay
(A) all overdue installments of interest on all of
the Debentures,
(B) any accrued Additional Interest on all of the
Debentures,
(C) the principal of (and premium, if any, on) any
Debentures that have become due otherwise than by such
declaration of acceleration and interest and Additional
Interest thereon at the rate borne by the Debentures, and
(D) all sums paid or advanced by the Debenture
Trustee under the Indenture and the reasonable compensation,
expenses, disbursements and advances of the Debenture Trustee
and the Institutional Trustee, their agents and counsel; and
(ii) all Events of Default with respect to the Debentures,
other than the non-payment of the principal of the Debentures that has
become due solely by such acceleration, have been cured or waived as
provided in Section 5.7 of the Indenture.
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The Holders of at least a majority in liquidation amount of the
Capital Securities may, on behalf of the Holders of all the Capital
Securities, waive any past default or Event of Default under the Indenture,
except a default or Event of Default in the payment of principal or interest
(unless such default or Event of Default has been cured and a sum sufficient
to pay all matured installments of interest and principal due otherwise than
by acceleration has been deposited with the Debenture Trustee) or a default or
Event of Default in respect of a covenant or provision that under the
Indenture cannot be modified or amended without the consent of the holder of
each outstanding Debenture. No such rescission shall affect any subsequent
default or impair any right consequent thereon.
Upon receipt by the Institutional Trustee of written notice declaring
such an acceleration, or rescission and annulment thereof, by Holders of any
part of the Capital Securities, a record date shall be established for
determining Holders of outstanding Capital Securities entitled to join in such
notice, which record date shall be at the close of business on the day the
Institutional Trustee receives such notice. The Holders on such record date,
or their duly designated proxies, and only such Persons, shall be entitled to
join in such notice, whether or not such Holders remain Holders after such
record date; PROVIDED, that unless such declaration of acceleration, or
rescission and annulment, as the case may be, shall have become effective by
virtue of the requisite percentage having joined in such notice prior to the
day that is 90 days after such record date, such notice of declaration of
acceleration, or rescission and annulment, as the case may be, shall
automatically and without further action by any Holder be canceled and of no
further effect. Nothing in this paragraph shall prevent a Holder, or a proxy
of a Holder, from giving, after expiration of such 90-day period, a new
written notice of declaration of acceleration, or rescission and annulment
thereof, as the case may be, that is identical to a written notice that has
been canceled pursuant to the proviso to the preceding sentence, in which
event a new record date shall be established pursuant to the provisions of
this Section 6.7.
(c) Except as otherwise provided in paragraphs (a) and (b) of this
Section 6.7, the Holders of at least a majority in liquidation amount of the
Capital Securities may, on behalf of the Holders of all the Capital
Securities, waive any past default or Event of Default and its consequences.
Upon such waiver, any such default or Event of Default shall cease to exist,
and any default or Event of Default arising therefrom shall be deemed to have
been cured, for every purpose of this Trust Agreement, but no such waiver
shall extend to any subsequent or other default or Event of Default or impair
any right consequent thereon.
ARTICLE VII
DISSOLUTION AND TERMINATION OF TRUST
SECTION 7.1. DISSOLUTION AND TERMINATION OF TRUST.
(a) The Trust shall dissolve on the first to occur of:
(i) unless earlier dissolved, on September 7, 2035, the
expiration of the term of the Trust;
(ii) upon a Bankruptcy Event with respect to the Sponsor, the
Trust or the Debenture Issuer;
(iii) (other than in connection with a merger, consolidation
or similar transaction not prohibited by the Indenture, this
Declaration or the Guarantee, as the case may be) upon the filing of a
certificate of dissolution or its equivalent with respect to the
Sponsor, upon the consent of Holders of a Majority in liquidation
amount of the Securities voting together as a single class to
26
file a certificate of cancellation with respect to the Trust or upon
the revocation of the charter of the Sponsor and the expiration of 90
days after the date of revocation without a reinstatement thereof;
(iv) upon the distribution of the Debentures to the Holders of
the Securities;
(v) upon exercise of the right of the Holder of all of the
outstanding Common Securities to dissolve the Trust as provided in
Annex I hereto;
(vi) upon the entry of a decree of judicial dissolution of the
Holder of the Common Securities, the Sponsor, the Trust or the
Debenture Issuer;
(vii) when all of the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall have
been paid to the Holders in accordance with the terms of the
Securities; or
(viii) before the issuance of any Securities, with the consent
of all of the Trustees and the Sponsor.
(b) As soon as is practicable after the occurrence of an event referred
to in Section 7.1(a), and after satisfaction of liabilities to creditors of the
Trust as required by applicable law, including of the Statutory Trust Act, and
subject to the terms set forth in Annex I, the Institutional Trustee shall
terminate the Trust by filing a certificate of cancellation with the Secretary
of State of the State of Connecticut.
(c) The provisions of Section 2.9 and Article IX shall survive the
termination of the Trust.
ARTICLE VIII
TRANSFER OF INTERESTS
SECTION 8.1. GENERAL.
(a) Subject to Section 8.1(c), where Capital Securities are presented
to the Registrar or a co-registrar with a request to register a transfer or to
exchange them for an equal number of Capital Securities represented by
different certificates, the Registrar shall register the transfer or make the
exchange if its requirements for such transactions are met. To permit
registrations of transfer and exchanges, the Trust shall issue and the
Institutional Trustee shall authenticate Capital Securities at the Registrar's
request.
(b) Upon issuance of the Common Securities, the Sponsor shall acquire
and retain beneficial and record ownership of the Common Securities and for so
long as the Securities remain outstanding, the Sponsor shall maintain 100%
ownership of the Common Securities; PROVIDED, HOWEVER, that any permitted
successor of the Sponsor, in its capacity as Debenture Issuer, under the
Indenture that is a U.S. Person may succeed to the Sponsor's ownership of the
Common Securities.
(c) Capital Securities may only be transferred, in whole or in part,
in accordance with the terms and conditions set forth in this Declaration and
in the terms of the Securities. To the fullest extent permitted by applicable
law, any transfer or purported transfer of any Security not made in accordance
with this Declaration shall be null and void and will be deemed to be of no
legal effect whatsoever and any such transferee shall be deemed not to be the
holder of such Capital Securities for any purpose, including but not limited
to the receipt of Distributions on such Capital Securities, and such
transferee shall be deemed to have no interest whatsoever in such Capital
Securities.
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(d) The Registrar shall provide for the registration of Securities
and of transfers of Securities, which will be effected without charge but only
upon payment (with such indemnity as the Registrar may require) in respect of
any tax or other governmental charges that may be imposed in relation to it.
Upon surrender for registration of transfer of any Securities, the Registrar
shall cause one or more new Securities of the same tenor to be issued in the
name of the designated transferee or transferees. Every Security surrendered
for registration of transfer shall be accompanied by a written instrument of
transfer in form satisfactory to the Registrar duly executed by the Holder or
such Holder's attorney duly authorized in writing. Each Security surrendered
for registration of transfer shall be canceled by the Institutional Trustee
pursuant to Section 6.6. A transferee of a Security shall be entitled to the
rights and subject to the obligations of a Holder hereunder upon the receipt
by such transferee of a Security. By acceptance of a Security, each transferee
shall be deemed to have agreed to be bound by this Declaration.
(e) The Trust shall not be required (i) to issue, register the
transfer of, or exchange any Securities during a period beginning at the
opening of business 15 days before the day of any selection of Securities for
redemption and ending at the close of business on the earliest date on which
the relevant notice of redemption is deemed to have been given to all Holders
of the Securities to be redeemed, or (ii) to register the transfer or exchange
of any Security so selected for redemption in whole or in part, except the
unredeemed portion of any Security being redeemed in part.
SECTION 8.2. TRANSFER PROCEDURES AND RESTRICTIONS.
(a) The Capital Securities shall bear the Restricted Securities
Legend, which shall not be removed unless there is delivered to the Trust such
satisfactory evidence, which may include an opinion of counsel licensed to
practice law in the State of Connecticut, as may be reasonably required by the
Trust, that neither the legend nor the restrictions on transfer set forth
therein are required to ensure that transfers thereof comply with the
provisions of the Securities Act. Upon provision of such satisfactory
evidence, the Institutional Trustee, at the written direction of the Trust,
shall authenticate and deliver Capital Securities that do not bear the legend.
(b) Except as permitted by Section 8.2(a), each Capital Security
shall bear a legend (the "RESTRICTED SECURITIES LEGEND") in substantially the
following form and a Capital Security shall not be transferred except in
compliance with such legend, unless otherwise determined by the Sponsor, upon
the advice of counsel expert in securities law, in accordance with applicable
law:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), ANY STATE SECURITIES LAWS
OR ANY OTHER APPLICABLE SECURITIES LAW. NEITHER THIS SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM,
OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER THIS SECURITY ONLY (A) TO THE SPONSOR OR THE
TRUST, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS
OF RULE 144A SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT
TO RULE 144A IN ACCORDANCE WITH RULE 144A, (C) TO A NON-U.S. PERSON IN
AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS
APPLICABLE) OF REGULATION S UNDER THE SECURITIES ACT, (D) TO
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AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THIS CAPITAL SECURITY FOR ITS OWN ACCOUNT, OR FOR
THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN
CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT,
OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE SPONSOR'S AND THE
TRUST'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM IN ACCORDANCE WITH THE
DECLARATION OF TRUST, A COPY OF WHICH MAY BE OBTAINED FROM THE SPONSOR
OR THE TRUST. THE HOLDER OF THIS SECURITY AGREES THAT IT WILL COMPLY
WITH THE FOREGOING RESTRICTIONS.
(c) To permit registrations of transfers and exchanges, the Trust
shall execute and the Institutional Trustee shall authenticate Capital
Securities at the Registrar's request.
(d) Registrations of transfers or exchanges will be effected without
charge, but only upon payment (with such indemnity as the Registrar or the
Sponsor may require) in respect of any tax or other governmental charge that
may be imposed in relation to it.
(e) All Capital Securities issued upon any registration of transfer
or exchange pursuant to the terms of this Declaration shall evidence the same
security and shall be entitled to the same benefits under this Declaration as
the Capital Securities surrendered upon such registration of transfer or
exchange.
SECTION 8.3. DEEMED SECURITY HOLDERS. The Trust, the Administrators,
the Trustees, the Paying Agent, the Transfer Agent or the Registrar may treat
the Person in whose name any Certificate shall be registered on the books and
records of the Trust as the sole holder of such Certificate and of the
Securities represented by such Certificate for purposes of receiving
Distributions and for all other purposes whatsoever and, accordingly, shall
not be bound to recognize any equitable or other claim to or interest in such
Certificate or in the Securities represented by such Certificate on the part
of any Person, whether or not the Trust, the Administrators, the Trustees, the
Paying Agent, the Transfer Agent or the Registrar shall have actual or other
notice thereof
ARTICLE IX
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 9.1. LIABILITY.
(a) Except as expressly set forth in this Declaration, the Guarantee
and the terms of the Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion of the
capital contributions (or any return thereon) of the Holders of the
Securities which shall be made solely from assets of the Trust; or
29
(ii) required to pay to the Trust or to any Holder of the
Securities any deficit upon dissolution of the Trust or otherwise.
(b) The Holder of the Common Securities shall be liable for all of
the debts and obligations of the Trust (other than with respect to the
Securities) to the extent not satisfied out of the Trust's assets.
(c) Pursuant to the Statutory Trust Act, the Holders of the Capital
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 Connecticut.
SECTION 9.2. EXCULPATION.
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Trust or any Covered Person for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of
the authority conferred on such Indemnified Person by this Declaration or by
law, except that an Indemnified Person shall be liable for any such loss,
damage or claim incurred by reason of such Indemnified Person's negligence or
willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and, if selected by such Indemnified Person,
has been selected by such Indemnified Person with reasonable care by or on
behalf of the Trust, including information, opinions, reports or statements as
to the value and amount of the assets, liabilities, profits, losses, or any
other facts pertinent to the existence and amount of assets from which
Distributions to Holders of Securities might properly be paid.
SECTION 9.3. FIDUCIARY DUTY.
(a) To the extent that, at law or in equity, an Indemnified Person
has duties (including fiduciary duties) and liabilities relating thereto to
the Trust or to any other Covered Person, an Indemnified Person acting under
this Declaration shall not be liable to the Trust or to any other Covered
Person for its good faith reliance on the provisions of this Declaration. The
provisions of this Declaration, to the extent that they restrict the duties
and liabilities of an Indemnified Person otherwise existing at law or in
equity, are agreed by the parties hereto to replace such other duties and
liabilities of the Indemnified Person.
(b) Whenever in this Declaration an Indemnified Person is permitted
or required to make a decision:
(i) in its "discretion" or under a grant of similar authority,
the Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have no
duty or obligation to give any consideration to any interest of or
factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard,
the Indemnified Person shall act under such express standard and shall
not be subject to any other or different standard imposed by this
Declaration or by applicable law.
30
SECTION 9.4. INDEMNIFICATION.
(a) The Sponsor shall indemnify, to the full extent permitted by law,
any Indemnified Person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the Trust) by reason of the fact that he is or was an
Indemnified Person against expenses (including reasonable attorneys' fees and
expenses), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding
if he acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful. The termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of NOLO CONTENDERE or its
equivalent, shall not, of itself, create a presumption that the Indemnified
Person did not act in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the Trust, and, with respect
to any criminal action or proceeding, had reasonable cause to believe that his
conduct was unlawful.
(b) The Sponsor shall indemnify, to the full extent permitted by law,
any Indemnified Person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or in the
right of the Trust to procure a judgment in its favor by reason of the fact
that he is or was an Indemnified Person against expenses (including reasonable
attorneys' fees and expenses) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted
in good faith and in a manner he reasonably believed to be in or not opposed
to the best interests of the Trust; PROVIDED, HOWEVER, that no such
indemnification shall be made in respect of any claim, issue or matter as to
which such Indemnified Person shall have been adjudged to be liable to the
Trust unless and only to the extent that the court in which such action or
suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which such court shall deem proper.
(c) To the extent that an Indemnified Person shall be successful on
the merits or otherwise (including dismissal of an action without prejudice or
the settlement of an action without admission of liability) in defense of any
action, suit or proceeding referred to in paragraphs (a) and (b) of this
Section 9.4, or in defense of any claim, issue or matter therein, he shall be
indemnified, to the full extent permitted by law, against expenses (including
attorneys' fees and expenses) actually and reasonably incurred by him in
connection therewith.
(d) Any indemnification of an Administrator under paragraphs (a) and
(b) of this Section 9.4 (unless ordered by a court) shall be made by the
Sponsor only as authorized in the specific case upon a determination that
indemnification of the Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set forth in paragraphs
(a) and (b). Such determination shall be made (i) by the Administrators by a
majority vote of a Quorum consisting of such Administrators who were not
parties to such action, suit or proceeding, (ii) if such a Quorum is not
obtainable, or, even if obtainable, if a Quorum of disinterested
Administrators so directs, by independent legal counsel in a written opinion,
or (iii) by the Common Security Holder of the Trust.
(e) To the fullest extent permitted by law, expenses (including
reasonable attorneys' fees and expenses) incurred by an Indemnified Person in
defending a civil, criminal, administrative or investigative action, suit or
proceeding referred to in paragraphs (a) and (b) of this Section 9.4 shall be
paid by the Sponsor in advance of the final disposition of such action, suit
or proceeding upon receipt of an undertaking by or on behalf of such
Indemnified Person to repay such amount if it shall ultimately be determined
that he is not entitled to be indemnified by the Sponsor as authorized in this
Section 9.4. Notwithstanding the foregoing, no advance shall be made by the
Sponsor if a determination is reasonably
31
and promptly made (i) by the Administrators by a majority vote of a Quorum of
disinterested Administrators, (ii) if such a Quorum is not obtainable, or,
even if obtainable, if a quorum of disinterested Administrators so directs, by
independent legal counsel in a written opinion or (iii) by the Common Security
Holder of the Trust, that, based upon the facts known to the Administrators,
counsel or the Common Security Holder at the time such determination is made,
such Indemnified Person acted in bad faith or in a manner that such Person did
not believe to be in or not opposed to the best interests of the Trust, or,
with respect to any criminal proceeding, that such Indemnified Person believed
or had reasonable cause to believe his conduct was unlawful. In no event shall
any advance be made in instances where the Administrators, independent legal
counsel or the Common Security Holder reasonably determine that such
Indemnified Person deliberately breached his duty to the Trust or its Common
or Capital Security Holders.
(f) Each Trustee, at the sole cost and expense of the Sponsor,
retains the right to representation by counsel of its own choosing in any
action, suit or any other proceeding for which it is indemnified under
paragraphs (a) and (b) of this Section 9.4, without affecting its right to
indemnification hereunder or waiving any rights afforded to it under this
Declaration or applicable law.
(g) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other paragraphs of this Section 9.4 shall not be
deemed exclusive of any other rights to which those seeking indemnification
and advancement of expenses may be entitled under any agreement, vote of
stockholders or disinterested directors of the Sponsor or Capital Security
Holders of the Trust or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office. All rights to
indemnification under this Section 9.4 shall be deemed to be provided by a
contract between the Sponsor and each Indemnified Person who serves in such
capacity at any time while this Section 9.4 is in effect. Any repeal or
modification of this Section 9.4 shall not affect any rights or obligations
then existing.
(h) The Sponsor or the Trust may purchase and maintain insurance on
behalf of any Person who is or was an Indemnified Person against any liability
asserted against him and incurred by him in any such capacity, or arising out
of his status as such, whether or not the Sponsor would have the power to
indemnify him against such liability under the provisions of this Section 9.4.
(i) For purposes of this Section 9.4, references to "the Trust" shall
include, in addition to the resulting or surviving entity, any constituent
entity (including any constituent of a constituent) absorbed in a
consolidation or merger, so that any Person who is or was a director, trustee,
officer or employee of such constituent entity, or is or was serving at the
request of such constituent entity as a director, trustee, officer, employee
or agent of another entity, shall stand in the same position under the
provisions of this Section 9.4 with respect to the resulting or surviving
entity as he would have with respect to such constituent entity if its
separate existence had continued.
(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Section 9.4 shall, unless otherwise provided when
authorized or ratified, (i) continue as to a Person who has ceased to be an
Indemnified Person and shall inure to the benefit of the heirs, executors and
administrators of such a Person; and (ii) survive the termination or
expiration of this Declaration or the earlier removal or resignation of an
Indemnified Person.
SECTION 9.5. OUTSIDE BUSINESSES. Any Covered Person, the Sponsor and
the Institutional Trustee may engage in or possess an interest in other
business ventures of any nature or description, independently or with others,
similar or dissimilar to the business of the Trust, and the Trust and the
Holders of Securities shall have no rights by virtue of this Declaration in
and to such independent ventures or the income or profits derived therefrom,
and the pursuit of any such venture, even if
32
competitive with the business of the Trust, shall not be deemed wrongful or
improper. None of any Covered Person, the Sponsor or the Institutional Trustee
shall be obligated to present any particular investment or other opportunity
to the Trust even if such opportunity is of a character that, if presented to
the Trust, could be taken by the Trust, and any Covered Person, the Sponsor
and the Institutional Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Covered Person and the
Institutional Trustee may engage or be interested in any financial or other
transaction with the Sponsor or any Affiliate of the Sponsor, or may act as
depositary for, trustee or agent for, or act on any committee or body of
holders of, securities or other obligations of the Sponsor or its Affiliates.
SECTION 9.6. COMPENSATION; FEE. The Sponsor agrees:
(a) to pay to the Trustees from time to time such compensation for
all services rendered by them hereunder as the parties shall agree from time
to time (which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust); and
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustees in accordance with any provision of this
Declaration (including the reasonable compensation and the expenses and
disbursements of their respective agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negligence, bad
faith or willful misconduct.
The provisions of this Section 9.6 shall survive the dissolution of
the Trust and the termination of this Declaration and the removal or
resignation of any Trustee.
No Trustee may claim any lien or charge on any property of the Trust
as a result of any amount due pursuant to this Section 9.6.
ARTICLE X
ACCOUNTING
SECTION 10.1. FISCAL YEAR. The fiscal year ("FISCAL YEAR") of the
Trust shall be the calendar year, or such other year as is required by the
Code.
SECTION 10.2. CERTAIN ACCOUNTING MATTERS.
(a) At all times during the existence of the Trust, the
Administrators shall keep, or cause to be kept at the principal office of the
Trust in the United States, as defined for purposes of Treasury regulations
section 301.7701-7, full books of account, records and supporting documents,
which shall reflect in reasonable detail each transaction of the Trust. The
books of account shall be maintained, at the Sponsor's expense, in accordance
with generally accepted accounting principles, consistently applied. The books
of account and the records of the Trust shall be examined by and reported upon
as of the end of each Fiscal Year of the Trust by a firm of independent
certified public accountants selected by the Administrators.
(b) The Administrators, at the Sponsor's expense, shall cause to be
prepared at the principal office of the Trust in the United States, as defined
for purposes of Treasury regulations section 301.7701-7, and delivered to each
of the Holders of Securities, within 90 days after the end of each Fiscal Year
of the Trust, annual financial statements of the Trust, including a balance
sheet of the Trust as of the end of
33
such Fiscal Year, and the related statements of income or loss which shall be
examined by and reported upon by a firm of independent certified public
accountants selected by the Administrators.
(c) The Administrators shall cause to be duly prepared and delivered
to each of the Holders of Securities Form 1099 or such other annual United
States federal income tax information statement required by the Code,
containing such information with regard to the Securities held by each Holder
as is required by the Code and the Treasury Regulations. Notwithstanding any
right under the Code to deliver any such statement at a later date, the
Administrators shall endeavor to deliver all such statements within 30 days
after the end of each Fiscal Year of the Trust.
(d) The Administrators, at the Sponsor's expense, shall cause to be
duly prepared at the principal office of the Trust in the United States, as
defined for purposes of Treasury regulations section 301.7701-7, and filed an
annual United States federal income tax return on a Form 1041 or such other
form required by United States federal income tax law, and any other annual
income tax returns required to be filed by the Administrators on behalf of the
Trust with any state or local taxing authority.
SECTION 10.3. BANKING. The Trust shall maintain in the United States,
as defined for purposes of Treasury regulations section 301.7701-7, one or
more bank accounts in the name and for the sole benefit of the Trust;
PROVIDED, HOWEVER, that all payments of funds in respect of the Debentures
held by the Institutional Trustee shall be made directly to the Property
Account and no other funds of the Trust shall be deposited in the Property
Account. The sole signatories for such accounts (including the Property
Account) shall be designated by the Institutional Trustee.
SECTION 10.4. WITHHOLDING. The Institutional Trustee or any Paying
Agent and the Administrators shall comply with all withholding requirements
under United States federal, state and local law. The Institutional Trustee or
any Paying Agent shall request, and each Holder shall provide to the
Institutional Trustee or any Paying Agent, such forms or certificates as are
necessary to establish an exemption from withholding with respect to the
Holder, and any representations and forms as shall reasonably be requested by
the Institutional Trustee or any Paying Agent to assist it in determining the
extent of, and in fulfilling, its withholding obligations. The Administrators
shall file required forms with applicable jurisdictions and, unless an
exemption from withholding is properly established by a Holder, shall remit
amounts withheld with respect to the Holder to applicable jurisdictions. To
the extent that the Institutional Trustee or any Paying Agent is required to
withhold and pay over any amounts to any authority with respect to
distributions or allocations to any Holder, the amount withheld shall be
deemed to be a Distribution in the amount of the withholding to the Holder. In
the event of any claimed overwithholding, Holders shall be limited to an
action against the applicable jurisdiction. If the amount required to be
withheld was not withheld from actual Distributions made, the Institutional
Trustee or any Paying Agent may reduce subsequent Distributions by the amount
of such withholding.
ARTICLE XI
AMENDMENTS AND MEETINGS
SECTION 11.1. AMENDMENTS.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may only be amended by a
written instrument approved and executed by the Institutional Trustee.
(b) Notwithstanding any other provision of this Article XI, no
amendment shall be made, and any such purported amendment shall be void and
ineffective:
34
(i) unless the Institutional Trustee shall have first received
(A) an Officers' Certificate from each of the Trust
and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the
terms of the Securities); and
(B) an opinion of counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the
terms of the Securities); and
(ii) if the result of such amendment would be to
(A) cause the Trust to cease to be classified for
purposes of United States federal income taxation as a grantor
trust; or
(B) cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment Company
Act.
(c) Except as provided in Section 11.1(d), (e) or (h), no amendment
shall be made, and any such purported amendment shall be void and ineffective
unless the Holders of a Majority in liquidation amount of the Capital
Securities shall have consented to such amendment.
(d) In addition to and notwithstanding any other provision in this
Declaration, without the consent of each affected Holder, this Declaration may
not be amended to (i) change the amount or timing of any Distribution on the
Securities or otherwise adversely affect the amount of any Distribution
required to be made in respect of the Securities as of a specified date or
change any conversion or exchange provisions or (ii) restrict the right of a
Holder to institute suit for the enforcement of any such payment on or after
such date.
(e) Section 8.1 (b) and 8.1(c) and this Section 11.1 shall not be
amended without the consent of all of the Holders of the Securities.
(f) Article III shall not be amended without the consent of the
Holders of a Majority in liquidation amount of the Common Securities.
(g) The rights of the Holders of the Capital Securities under Article
IV to increase or decrease the number of, and appoint and remove, Trustees
shall not be amended without the consent of the Holders of a Majority in
liquidation amount of the Capital Securities.
(h) This Declaration may be amended by the Institutional Trustee and
the Holders of a Majority in the liquidation amount of the Common Securities
without the consent of the Holders of the Capital Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this Declaration
that may be defective or inconsistent with any other provision of this
Declaration;
(iii) add to the covenants, restrictions or obligations of the
Sponsor; or
(iv) modify, eliminate or add to any provision of this
Declaration to such extent as may be necessary to ensure that the Trust
will be classified for United States federal income tax
35
purposes at all times as a grantor trust and will not be required to
register as an "investment company" under the Investment Company Act
(including without limitation to conform to any change in Rule 3a-5,
Rule 3a-7 or any other applicable rule under the Investment Company Act
or written change in interpretation or application thereof by any
legislative body, court, government agency or regulatory authority)
which amendment does not have a material adverse effect on the rights,
preferences or privileges of the Holders of Securities;
PROVIDED, HOWEVER, that no such modification, elimination or addition
referred to in clauses (i), (ii) or (iii) shall adversely affect in any
material respect the powers, preferences or special rights of Holders of
Capital Securities.
SECTION 11.2. MEETINGS OF THE HOLDERS OF SECURITIES; ACTION BY
WRITTEN CONSENT.
(a) Meetings of the Holders of any class of Securities may be called
at any time by the Administrators (or as provided in the terms of the
Securities) to consider and act on any matter on which Holders of such class
of Securities are entitled to act under the terms of this Declaration or the
terms of the Securities. The Administrators shall call a meeting of the
Holders of such class if directed to do so by the Holders of at least 10% in
liquidation amount of such class of Securities. Such direction shall be given
by delivering to the Administrators one or more calls in a writing stating
that the signing Holders of the Securities wish to call a meeting and
indicating the general or specific purpose for which the meeting is to be
called. Any Holders of the Securities calling a meeting shall specify in
writing the Certificates held by the Holders of the Securities exercising the
right to call a meeting and only those Securities represented by such
Certificates shall be counted for purposes of determining whether the required
percentage set forth in the second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of the
Securities:
(i) notice of any such meeting shall be given to all the
Holders of the Securities having a right to vote thereat at least 7
days and not more than 60 days before the date of such meeting.
Whenever a vote, consent or approval of the Holders of the Securities
is permitted or required under this Declaration, such vote, consent or
approval may be given at a meeting of the Holders of the Securities.
Any action that may be taken at a meeting of the Holders of the
Securities may be taken without a meeting if a consent in writing
setting forth the action so taken is signed by the Holders of the
Securities owning not less than the minimum amount of Securities in
liquidation amount that would be necessary to authorize or take such
action at a meeting at which all Holders of the Securities having a
right to vote thereon were present and voting. Prompt notice of the
taking of action without a meeting shall be given to the Holders of the
Securities entitled to vote who have not consented in writing. The
Administrators may specify that any written ballot submitted to the
Holders of the Securities for the purpose of taking any action without
a meeting shall be returned to the Trust within the time specified by
the Administrators;
(ii) each Holder of a Security may authorize any Person to act
for it by proxy on all matters in which a Holder of Securities is
entitled to participate, including waiving notice of any meeting, or
voting or participating at a meeting. No proxy shall be valid after the
expiration of 11 months from the date thereof unless otherwise provided
in the proxy. Every proxy shall be revocable at the pleasure of the
Holder of the Securities executing it. Except as otherwise provided
herein, all matters relating to the giving, voting or validity of
proxies shall be governed by the General Corporation Law of the State
of Connecticut relating to proxies, and judicial interpretations
thereunder, as if the Trust were a Connecticut corporation and the
Holders of the
36
Securities were stockholders of a Connecticut corporation; each
meeting of the Holders of the Securities shall be conducted by the
Administrators or by such other Person that the Administrators may
designate; and
(iii) unless the Statutory Trust Act, this Declaration, or the
terms of the Securities otherwise provides, the Administrators, in
their sole discretion, shall establish all other provisions relating to
meetings of Holders of Securities, including notice of the time, place
or purpose of any meeting at which any matter is to be voted on by any
Holders of the Securities, waiver of any such notice, action by consent
without a meeting, the establishment of a record date, quorum
requirements, voting in person or by proxy or any other matter with
respect to the exercise of any such right to vote; PROVIDED, HOWEVER,
that each meeting shall be conducted in the United States (as that term
is defined in Treasury regulations section 301.7701-7).
ARTICLE XII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
SECTION 12.1. REPRESENTATIONS AND WARRANTIES OF INSTITUTIONAL
TRUSTEE. The Trustee that acts as initial Institutional Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Institutional Trustee represents and warrants to the Trust and
the Sponsor at the time of the Successor Institutional Trustee's acceptance of
its appointment as Institutional Trustee, that:
(a) the Institutional Trustee is a national banking association with
trust powers, duly organized and validly existing under the laws of the United
States of America with trust power and authority to execute and deliver, and
to carry out and perform its obligations under the terms of, this Declaration;
(b) the execution, delivery and performance by the Institutional
Trustee of this Declaration has been duly authorized by all necessary
corporate action on the part of the Institutional Trustee. This Declaration
has been duly executed and delivered by the Institutional Trustee, and it
constitutes a legal, valid and binding obligation of the Institutional
Trustee, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, reorganization, moratorium, insolvency, and other
similar laws affecting creditors' rights generally and to general principles
of equity (regardless of whether considered in a proceeding in equity or at
law);
(c) the execution, delivery and performance of this Declaration by
the Institutional Trustee does not conflict with or constitute a breach of the
charter or by-laws of the Institutional Trustee; and
(d) no consent, approval or authorization of, or registration with or
notice to, any state or federal banking authority is required for the
execution, delivery or performance by the Institutional Trustee of this
Declaration.
ARTICLE XIII
MISCELLANEOUS
SECTION 13.1. NOTICES. All notices provided for in this Declaration
shall be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied (which telecopy shall be followed by notice delivered or
mailed by first class mail) or mailed by first class mail, as follows:
37
(a) if given to the Trust in care of the Administrators at the
Trust's mailing address set forth below (or such other address as the Trust
may give notice of to the Holders of the Securities):
First Community /CA Statutory Trust I
c/o First Community Bancorp
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if given to the Institutional Trustee, at the Institutional
Trustee's mailing address set forth below (or such other address as the
Institutional Trustee may give notice of to the Holders of the Securities):
State Street Bank and Trust Company of Connecticut,
National Association
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Square
Hartford, Connecticut 06103
Attention: Vice President, Corporate Trust Department
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to:
State Street Bank and Trust Company
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Corporate Trust Department
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(c) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the Holder of
the Common Securities may give notice of to the Trust):
First Community Bancorp
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(d) if given to any other Holder, at the address set forth on the
books and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered on
the date of such refusal or inability to deliver.
SECTION 13.2. GOVERNING LAW. This Declaration and the rights of the
parties hereunder shall be governed by and interpreted in accordance with the
law of the State of Connecticut and all rights and remedies shall be governed
by such laws without regard to the principles of conflict of laws of the State
of Connecticut or any other jurisdiction that would call for the application
of the law of any jurisdiction other than the State of Connecticut; PROVIDED,
HOWEVER, that there shall not be applicable to the Trust, the
38
Trustees or this Declaration any provision of the laws (statutory or common)
of the State of Connecticut pertaining to trusts that relate to or regulate,
in a manner inconsistent with the terms hereof (a) the filing with any court
or governmental body or agency of trustee accounts or schedules of trustee
fees and charges, (b) affirmative requirements to post bonds for trustees,
officers, agents or employees of a trust, (c) the necessity for obtaining
court or other governmental approval concerning the acquisition, holding or
disposition of real or personal property, (d) fees or other sums payable to
trustees, officers, agents or employees of a trust, (e) the allocation of
receipts and expenditures to income or principal, or (f) restrictions or
limitations on the permissible nature, amount or concentration of trust
investments or requirements relating to the titling, storage or other manner
of holding or investing trust assets.
SECTION 13.3. INTENTION OF THE PARTIES. It is the intention of the
parties hereto that the Trust be classified for United States federal income
tax purposes as a grantor trust. The provisions of this Declaration shall be
interpreted to further this intention of the parties.
SECTION 13.4. HEADINGS. Headings contained in this Declaration are
inserted for convenience of reference only and do not affect the
interpretation of this Declaration or any provision hereof.
SECTION 13.5. SUCCESSORS AND ASSIGNS. Whenever in this Declaration
any of the parties hereto is named or referred to, the successors and assigns
of such party shall be deemed to be included, and all covenants and agreements
in this Declaration by the Sponsor and the Trustees shall bind and inure to
the benefit of their respective successors and assigns, whether or not so
expressed.
SECTION 13.6. PARTIAL ENFORCEABILITY. If any provision of this
Declaration, or the application of such provision to any Person or
circumstance, shall be held invalid, the remainder of this Declaration, or the
application of such provision to persons or circumstances other than those to
which it is held invalid, shall not be affected thereby.
SECTION 13.7. COUNTERPARTS. This Declaration may contain more than
one counterpart of the signature page and this Declaration may be executed by
the affixing of the signature of each of the Trustees and Administrators to
any of such counterpart signature pages. All of such counterpart signature
pages shall be read as though one, and they shall have the same force and
effect as though all of the signers had signed a single signature page.
39
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, as
Institutional Trustee
By:
-------------------------------------
Name:
Title:
FIRST COMMUNITY BANCORP, as Sponsor
By:
-------------------------------------
Name:
Title:
FIRST COMMUNITY/CA STATUTORY TRUST I
By:
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇: Administrator
By:
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Administrator
40
ANNEX I
TERMS OF SECURITIES
Pursuant to Section 6.1 of the Amended and Restated
Declaration of Trust, dated as of September 7, 2000 (as amended from time to
time, the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Capital Securities and the
Common Securities are set out below (each capitalized term used but not
defined herein has the meaning set forth in the Declaration):
1. DESIGNATION AND NUMBER.
(a) 8,000 Capital Securities of First Community/CA Statutory
Trust I (the "Trust"), with an aggregate stated liquidation amount with
respect to the assets of the Trust of Eight Million Dollars ($8,000,000) and a
stated liquidation amount with respect to the assets of the Trust of $1,000
per Capital Security, are hereby designated for the purposes of identification
only as the "CAPITAL SECURITIES". The Capital Security Certificates evidencing
the Capital Securities shall be substantially in the form of Exhibit A-1 to
the Declaration, with such changes and additions thereto or deletions
therefrom as may be required by ordinary usage, custom or practice.
(b) 248 Common Securities of the Trust (the "COMMON
SECURITIES") will be evidenced by Common Security Certificates substantially
in the form of Exhibit A-2 to the Declaration, with such changes and additions
thereto or deletions therefrom as may be required by ordinary usage, custom or
practice.
2. DISTRIBUTIONS.
(a) Distributions payable on each Security will be payable
at an annual rate equal to 10.60% (the "COUPON RATE") of the stated
liquidation amount of $1,000 per Security, such rate being the rate of
interest payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears for more than one semi-annual period will bear
interest thereon compounded semi-annually at the Coupon Rate (to the extent
permitted by law). A Distribution is payable only to the extent that payments
are made in respect of the Debentures held by the Institutional Trustee and to
the extent the Institutional Trustee has funds available therefor. The amount
of Distributions payable for any period will be computed for any full
semi-annual period on the basis of a 360-day year of twelve 30-day months.
(b) Distributions on the Securities will be cumulative, will
accrue from the date of original issuance, and will be payable, subject to
extension of distribution payment periods as described herein, semi-annually
in arrears on March 7 and September 7 of each year, commencing on March 7,
2001 (each a "DISTRIBUTION PAYMENT DATE") when, as and if available for
payment. The Debenture Issuer has the right under the Indenture to defer
payments of interest on the Debentures, so long as no Indenture Event of
Default has occurred and is continuing, by deferring the payment of interest
on the Debentures for up to 10 consecutive semi-annual periods (each an
"EXTENSION PERIOD") at any time and from time to time, subject to the
conditions described below, although such interest would continue to accrue on
the Debentures at the Coupon Rate compounded semi-annually (to the extent
permitted by law) during any Extension Period. No Extension Period may end on
a date other than a Distribution Payment Date. At the end of any such
Extension Period the Debenture Issuer shall pay all interest then accrued and
unpaid on the Debentures (together with Additional Interest thereon);
PROVIDED, HOWEVER, that no Extension Period may extend beyond the Maturity
Date and PROVIDED FURTHER, HOWEVER, during any such Extension Period, the
Debenture Issuer and its Affiliates shall not (i) declare or pay any dividends
or distributions on, or redeem, purchase, acquire, or make a liquidation
payment with respect to, any of the Debenture Issuer's or its Affiliates'
capital stock (other than payments of dividends or distributions to the
Debenture
C-1
Issuer) or make any guarantee payments with respect to the foregoing, or (ii)
make any payment of principal of or interest or premium, if any, on or repay,
repurchase or redeem any debt securities of the Debenture Issuer or any
Affiliate that rank PARI PASSU in all respects with or junior in interest to
the Debentures (other than, with respect to clauses (i) and (ii) above, (a)
repurchases, redemptions or other acquisitions of shares of capital stock of
the Debenture Issuer in connection with any employment contract, benefit plan
or other similar arrangement with or for the benefit of one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
or stockholder stock purchase plan or in connection with the issuance of
capital stock of the Debenture Issuer (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a
result of any exchange or conversion of any class or series of the Debenture
Issuer's capital stock (or any capital stock of a subsidiary of the Debenture
Issuer) for any class or series of the Debenture Issuer's capital stock or of
any class or series of the Debenture Issuer's indebtedness for any class or
series of the Debenture Issuer's capital stock, (c) the purchase of fractional
interests in shares of the Debenture Issuer's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged, (d) any declaration of a dividend in connection with
any stockholder's rights plan, or the issuance of rights, stock or other
property under any stockholder's rights plan, or the redemption or repurchase
of rights pursuant thereto, (e) any dividend in the form of stock, warrants,
options or other rights where the dividend stock or the stock issuable upon
exercise of such warrants, options or other rights is the same stock as that
on which the dividend is being paid or ranks PARI PASSU with or junior to such
stock and any cash payments in lieu of fractional shares issued in connection
therewith, or (f) payments under the Capital Securities Guarantee). Prior to
the termination of any Extension Period, the Debenture Issuer may further
extend such period, provided that such period together with all such previous
and further consecutive extensions thereof shall not exceed 10 consecutive
semi-annual periods, or extend beyond the Maturity Date. Upon the termination
of any Extension Period and upon the payment of all accrued and unpaid
interest and Additional Interest, the Debenture Issuer may commence a new
Extension Period, subject to the foregoing requirements. No interest or
Additional Interest shall be due and payable during an Extension Period,
except at the end thereof, but each installment of interest that would
otherwise have been due and payable during such Extension Period shall bear
Additional Interest. If Distributions are deferred, the Distributions due
shall be paid on the date that the related Extension Period terminates, to
Holders of the Securities as they appear on the books and records of the Trust
on the record date immediately preceding such date. Distributions on the
Securities must be paid on the dates payable (after giving effect to any
Extension Period) to the extent that the Trust has funds available for the
payment of such distributions in the Property Account of the Trust. The
Trust's funds available for Distribution to the Holders of the Securities will
be limited to payments received from the Debenture Issuer. The payment of
Distributions out of moneys held by the Trust is guaranteed by the Guarantor
pursuant to the Guarantee.
(c) Distributions on the Securities will be payable to the
Holders thereof as they appear on the books and records of the Trust on the
relevant record dates. The relevant record dates shall be 15 days before the
relevant Distribution Payment Date. Distributions payable on any Securities
that are not punctually paid on any Distribution Payment Date, as a result of
the Debenture Issuer having failed to make a payment under the Debentures, as
the case may be, when due (taking into account any Extension Period), will
cease to be payable to the Person in whose name such Securities are registered
on the relevant record date, and such defaulted Distribution will instead be
payable to the Person in whose name such Securities are registered on the
special record date or other specified date determined in accordance with the
Indenture. If any date on which Distributions are payable on the Securities is
not a Business Day, then payment of the Distribution payable on such date will
be made on the next succeeding day that 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, such payment shall be
made on the immediately preceding Business Day, in each case with the same
force and effect as if made on such payment date.
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(d) In the event that there is any money or other property
held by or for the Trust that is not accounted for hereunder, such property
shall be distributed Pro Rata (as defined herein) among the Holders of the
Securities.
3. LIQUIDATION DISTRIBUTION UPON DISSOLUTION. In the event of the
voluntary or involuntary liquidation, dissolution, winding-up or termination
of the Trust (each a "LIQUIDATION") other than in connection with a redemption
of the Debentures, the Holders of the Securities will be entitled to receive
out of the assets of the Trust available for distribution to Holders of the
Securities, after satisfaction of liabilities to creditors of the Trust (to
the extent not satisfied by the Debenture Issuer), distributions equal to the
lesser of (i) the aggregate of the stated liquidation amount of $ 1,000 per
Security plus accrued and unpaid Distributions thereon to the date of payment,
to the extent the Trust shall have funds available therefor, and (ii) the
amount of assets of the Trust remaining available for distribution to Holders
in liquidation of the Trust (such amount being, in either case, the
"LIQUIDATION DISTRIBUTION"), unless in connection with such Liquidation, the
Debentures in aggregate stated principal amount equal to the aggregate stated
liquidation amount of such Securities, with an interest rate equal to the
Coupon Rate of, and bearing accrued and unpaid interest in an amount equal to
the accrued and unpaid Distributions on, and having the same record date as,
such Securities, after paying or making reasonable provision to pay all claims
and obligations of the Trust in accordance with the Statutory Trust Act, shall
be distributed on a Pro Rata basis to the Holders of the Securities in
exchange for such Securities.
The Sponsor, as the Holder of all of the Common Securities, has the
right at any time to dissolve the Trust (including, without limitation, upon
the occurrence of a Special Event), subject to the receipt by the Debenture
Issuer of prior approval from the Board of Governors of the Federal Reserve
System (the "FEDERAL RESERVE"), if then required under applicable capital
guidelines or policies of the Federal Reserve and, after satisfaction of
liabilities to creditors of the Trust, cause the Debentures to be distributed
to the Holders of the Securities on a Pro Rata basis in accordance with the
aggregate stated liquidation amount thereof.
If a Liquidation of the Trust occurs as described in clause (i),
(ii), (iii) or (v) in Section 7.1(a) of the Declaration, the Trust shall be
liquidated by the Trustees of the Trust as expeditiously as such Trustees
determine to be possible by distributing, after satisfaction of liabilities to
creditors of the Trust, to the Holders of the Securities, the Debentures on a
Pro Rata basis to the extent not satisfied by the Debenture Issuer, unless
such distribution is determined by the Institutional Trustee not to be
practical, in which event such Holders will be entitled to receive out of the
assets of the Trust available for distribution to the Holders, after
satisfaction of liabilities of creditors of the Trust to the extent not
satisfied by the Debenture Issuer, an amount equal to the Liquidation
Distribution. An early Liquidation of the Trust pursuant to clause (iv) of
Section 7.1(a) of the Declaration shall occur if the, Institutional Trustee
determines that such Liquidation is possible by distributing, after
satisfaction of liabilities to creditors of Trust, to the Holders of the
Securities on a Pro Rata basis, the Debentures, and such distribution occurs.
If, upon any such Liquidation the Liquidation Distribution can be
paid only in part because the Trust has insufficient assets available to pay
in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on such Capital Securities shall be paid to the Holders
of the Trust Securities on a Pro Rata basis, except that if an Event of
Default has occurred and is continuing, the Capital Securities shall have a
preference over the Common Securities with regard to such distributions.
After the date for any distribution of the Debentures upon dissolution
of the Trust (i) the Securities of the Trust will be deemed to be no longer
outstanding, (ii) the Holders of the Capital Securities will receive
certificates representing the Debentures to be delivered upon such distribution,
and (iii) any certificates representing the Capital Securities still outstanding
will be deemed to represent undivided beneficial interests in such of the
Debentures as have an aggregate principal amount equal to the aggregate stated
liquidation amount with an interest rate identical to the distribution rate
of, and
C-3
bearing accrued and unpaid interest equal to accrued and unpaid distributions
on, the Securities until such certificates are presented to the Debenture
Issuer or its agent for transfer or reissuance.
4. REDEMPTION AND DISTRIBUTION.
(a) The Debentures will mature on September 7, 2030. The
Debentures may be redeemed by the Debenture Issuer, in whole or in part at any
time and from time to time on or after September 7, 2010, at the Redemption
Price. In addition, the Debentures may be redeemed by the Debenture Issuer at
the Special Redemption Price, in whole but not in part, at any time, upon the
occurrence and continuation of a Special Event within 90 days following the
occurrence of such Special Event at the Special Redemption Price, upon not
less than 30 nor more than 60 days' notice to holders of such Debentures so
long as such Special Event is continuing. In each case, the right of the
Debenture Issuer to redeem the Debentures is subject to the Debenture Issuer
having received prior approval from the Federal Reserve, if then required
under applicable capital guidelines or policies of the Federal Reserve. The
Sponsor shall appoint a Quotation Agent, which initially shall be State Street
Bank and Trust Company, for the purpose of performing the services
contemplated in, or by reference in, the definition of Special Redemption
Price. Any error in the calculation of the Special Redemption Price by the
Quotation Agent or the Debenture Trustee may be corrected at any time by
notice delivered to the Sponsor and the holders of the Capital Securities.
Subject to the corrective rights set forth above, all certificates,
communications, opinions, determinations, calculations, quotations and
decisions given, expressed, made or obtained for the purposes of the
provisions relating to the payment and calculation of the Special Redemption
Price on the Debt Securities or the Capital Securities by the Debenture
Trustee, the Quotation Agent or the Institutional Trustee, as the case may be,
shall (in the absence of willful default, bad faith or manifest error) be
final, conclusive and binding on the holders of the Debt Securities and the
Capital Securities, the Trust and the Sponsor, and no liability shall attach
(except as provided above) to the Debenture Trustee, the Quotation Agent or
the Institutional Trustee in connection with the exercise or non-exercise by
any of them of their respective powers, duties and discretion.
"TAX EVENT" means the receipt by the Debenture Issuer and the Trust
of an opinion of counsel experienced in such matters to the effect that, as a
result of any amendment to or change (including any announced prospective
change) in the laws or any regulations thereunder of the United States or any
political subdivision or taxing authority thereof or therein, or as a result
of any official administrative pronouncement (including any private letter
ruling, technical advice memorandum, field service advice, regulatory
procedure, notice or announcement including any notice or announcement of
intent to adopt such procedures or regulations (an "ADMINISTRATIVE ACTION"))
or judicial decision interpreting or applying such laws or regulations,
regardless of whether such Administrative Action or judicial decision is
issued to or in connection with a proceeding involving the Debenture Issuer or
the Trust and whether or not subject to review or appeal, which amendment,
clarification, change, Administrative Action or decision is enacted,
promulgated or announced, in each case on or after the date of issuance of the
Debentures, there is more than an insubstantial risk that: (i) the Trust is,
or will be within 90 days of the date of such opinion, subject to United
States federal income tax with respect to income received or accrued on the
Debentures; (ii) interest payable by the Debenture Issuer on the Debentures is
not, or within 90 days of the date of such opinion, will not be, deductible by
the Debenture Issuer, in whole or in part, for United States federal income
tax purposes; or (iii) the Trust is, or will be within 90 days of the date of
such opinion, subject to more than a de minimis amount of other taxes, duties
or other governmental charges.
"INVESTMENT COMPANY EVENT" means the receipt by the Debenture Issuer
and the Trust of an opinion of counsel experienced in such matters to the
effect that, as a result of the occurrence of a change in law or regulation or
written change (including any announced prospective change) in interpretation
or application of law or regulation by any legislative body, court,
governmental agency or regulatory authority, there is more than an
insubstantial risk that the Trust is or will be considered an "Investment
Company" that is required to be registered under the Investment Company Act of
1940, as amended
C-4
which change or prospective change becomes effective or would become
effective, as the case may be, on or after the date of the issuance of the
Debentures.
"CAPITAL TREATMENT EVENT" means the receipt by the Debenture Issuer
and the Trust of an opinion of counsel that, as a result of the occurrence of
any amendment to, or change (including any announced prospective change) in,
the laws of the United States or any political subdivision thereof or therein,
or as the result of any official or administrative pronouncement or action or
decision interpreting or applying such laws, rules or regulations, which
amendment or change is effective or which pronouncement, action or decision is
announced on or after the date of issuance of the Debentures, there is more
than an insubstantial risk that the Sponsor will not be entitled to treat an
amount equal to the aggregate liquidation amount of the Debentures as "Tier 1
Capital" (or the then equivalent thereof) for purposes of the capital adequacy
guidelines of the Federal Reserve, as then in effect and applicable to the
Sponsor; PROVIDED, HOWEVER, that the inability of the Sponsor to treat all or
any portion of the liquidation amount of the Debentures as Tier l Capital
shall not constitute the basis for a Capital Treatment Event, if such
inability results from the Sponsor having cumulative preferred stock, minority
interests in consolidated subsidiaries, or any other class of security or
interest which the Federal Reserve may now or hereinafter accord Tier 1
Capital treatment in excess of the amount which may qualify for treatment as
Tier 1 Capital under applicable capital adequacy guidelines for the Federal
Reserve; PROVIDED FURTHER, HOWEVER, that the distribution of Debentures in
connection with the Liquidation of the Trust shall not in and of itself
constitute a Capital Treatment Event unless such Liquidation shall have
occurred in connection with a Tax Event or an Investment Company Event.
"SPECIAL EVENT" means a Tax Event, an Investment Company Event or a
Capital Treatment Event.
"REDEMPTION PRICE" means the price set forth in the following table
for any Redemption Date that occurs within the twelve-month period beginning
in the relevant year indicated below, expressed as the percentage of the
principal amount of the Debentures being redeemed:
Year Beginning on Percentage
----------------- ----------
September 7, 2010 105.300%
September 7, 2011 104.770%
September 7, 2012 104.240%
September 7, 2013 103.710%
September 7, 2014 103.180%
September 7, 2015 102.650%
September 7, 2016 102.120%
September 7, 2017 101.590%
September 7, 2018 101.060%
September 7, 2019 100.530%
September 7, 2020 and after 100.000%
plus accrued and unpaid interest on such Debentures to the Redemption Date.
"SPECIAL REDEMPTION DATE" means a Redemption Date on which a Special
Event redemption occurs.
C-5
"SPECIAL REDEMPTION PRICE" means (a) if the Special Redemption Date
is before September 7, 2010, the greater of (i) 100% of the principal amount
of the Debentures, plus accrued and unpaid interest on the Debentures to such
Special Redemption Date, or (ii) as determined by a Quotation Agent, the sum
of (A) the present value of the principal amount of the Debentures set forth
in the above Redemption Price table for the September 7, 2010 Redemption Date
and the present value of interest payable on the Debentures from such Special
Redemption Date to September 7, 2010 (the "REMAINING LIFE"), each discounted
to the Special Redemption Date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months at the Treasury Rate), plus (B) accrued and
unpaid interest on the Debentures to such Special Redemption Date, or (b) if
the Special Redemption Date is on or after September 7, 2010, the price for
the Debentures set forth in the above Redemption Price table for such Special
Redemption Date.
"COMPARABLE TREASURY ISSUE" means with respect to any Special
Redemption Date the United States Treasury security selected by the Quotation
Agent as having a maturity comparable to the Remaining Life that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the Remaining Life. If no United States Treasury security has a
maturity which is within a period from 3 months before to 3 months after
September 7, 2010, the two most closely corresponding United States Treasury
securities as selected by the Quotation Agent shall be used as the Comparable
Treasury Issue, and the Treasury Rate shall be interpolated or extrapolated on
a straight-line basis, rounding to the nearest month using such securities.
"COMPARABLE TREASURY PRICE" means (a) the average of 5 Reference
Treasury Dealer Quotations for such Special Redemption Date, after excluding
the highest and lowest such Reference Treasury Dealer Quotations, or (b) if
the Quotation Agent obtains fewer than 5 such Reference Treasury Dealer
Quotations, the average of all such Quotations.
"PRIMARY TREASURY DEALER" shall mean either a primary United States
Government securities dealer or an entity of nationally recognized stock in
matters pertaining to the quotation of treasury securities that is reasonably
acceptable to the Sponsor and the Institutional Trustee.
"QUOTATION AGENT" means State Street Bank and Trust Company, or its
designee, and its successors; provided, however, that if the foregoing shall
cease to be a Primary Treasury Dealer, the Sponsor shall substitute therefor
another Primary Treasury Dealer.
"REDEMPTION DATE" shall mean the date fixed for the redemption of
Capital Securities, which shall be March 7 or September 7 commencing September
7, 2010.
"REFERENCE TREASURY DEALER" means (i) the Quotation Agent and (ii)
any other Primary Treasury Dealer selected by the Debenture Trustee after
consultation with the Debenture Issuer.
"REFERENCE TREASURY DEALER QUOTATIONS" means, with respect to each
Reference Treasury Dealer and any Special Redemption Date, the average, as
determined by the Quotation Agent, of the bid and asked prices for the
Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the Debenture Trustee by such Reference
Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day
preceding such Redemption Date.
"TREASURY RATE" means (i) the yield, under the heading which
represents the average for the week immediately prior to the date of
calculation, appearing in the most recently published statistical release
designated H.15(519) or any successor publication which is published weekly by
the Federal Reserve and which establishes yields on actively traded United
States Treasury securities adjusted to constant maturity under the caption
"Treasury Constant Maturities", for the maturity corresponding to the
Remaining Life
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(if no maturity is within 3 months before or after the Remaining Life, yields
for the 2 published maturities most closely corresponding to the Remaining
Life shall be determined and the Treasury Rate shall be interpolated or
extrapolated from such yields on a straight-line basis, rounding to the
nearest month) or (ii) if such release (or any successor release) is not
published during the week preceding the calculation date or does not contain
such yields, the rate per annum equal to the semi-annual equivalent yield to
maturity of the Comparable Treasury Issue, calculated using a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount)
equal to the Comparable Treasury Price for such Special Redemption Date. The
Treasury Rate shall be calculated by the Quotation Agent on the third Business
Day preceding the Special Redemption Date.
(b) Upon the repayment in full at maturity or redemption in
whole or in part of the Debentures (other than following the distribution of
the Debentures to the Holders of the Securities), the proceeds from such
repayment or payment shall concurrently be applied to redeem Pro Rata at the
applicable Redemption Price or Special Redemption Price, as applicable,
Securities having an aggregate liquidation amount equal to the aggregate
principal amount of the Debentures so repaid or redeemed; PROVIDED, HOWEVER,
that holders of such Securities shall be given not less than 30 nor more than
60 days' notice of such redemption (other than at the scheduled maturity of
the Debentures).
(c) If fewer than all the outstanding Securities are to be
so redeemed, the Common Securities and the Capital Securities will be redeemed
Pro Rata and the Capital Securities to be redeemed will be redeemed Pro Rata
from each Holder of Capital Securities.
(d) The Trust may not redeem fewer than all the outstanding
Capital Securities unless all accrued and unpaid Distributions have been paid
on all Capital Securities for all semi-annual Distribution periods terminating
on or before the date of redemption.
(e) REDEMPTION OR DISTRIBUTION PROCEDURES.
(i) Notice of any redemption of or notice of
distribution of the Debentures in exchange for, the Securities (a
"REDEMPTION/DISTRIBUTION NOTICE") will be given by the Trust by mail to
each Holder of Securities to be redeemed or exchanged not fewer than 30
nor more than 60 days before the date fixed for redemption or exchange
thereof which, in the case of a redemption, will be the date fixed for
redemption of the Debentures. For purposes of the calculation of the
date of redemption or exchange and the dates on which notices are given
pursuant to this paragraph 4(e)(i), a Redemption/Distribution Notice
shall be deemed to be given on the day such notice is first mailed by
first-class mail, postage prepaid, to Holders of such Securities. Each
Redemption/Distribution Notice shall be addressed to the Holders of
such Securities at the address of each such Holder appearing on the
books and records of the Trust. No defect in the
Redemption/Distribution Notice or in the mailing thereof with respect
to any Holder shall affect the validity of the redemption or exchange
proceedings with respect to any other Holder.
(ii) If the Securities are to be redeemed and the
Trust gives a Redemption/ Distribution Notice, which notice may only be
issued if the Debentures are redeemed as set out in this paragraph 4
(which notice will be irrevocable), then, PROVIDED that the
Institutional Trustee has a sufficient amount of cash in connection
with the related redemption or maturity of the Debentures, the
Institutional Trustee will pay the relevant Redemption Price or
Special Redemption Price, as applicable, to the Holders of such
Securities by check mailed to the address of each such Holder appearing
on the books and records of the Trust on the redemption date. If a
Redemption/Distribution Notice shall have been given and funds
deposited as required then immediately prior to the close of business
on the date of such deposit Distributions will cease to accrue on the
Securities so called for redemption and all rights of Holders of such
Securities so
C-7
called for redemption will cease, except the right of the Holders of
such Securities to receive the applicable Redemption Price or Special
Redemption Price specified in paragraph 4(a), but without interest on
such Redemption Price or Special Redemption Price. If any date fixed
for redemption of Securities is not a Business Day, then payment of any
such Redemption Price or Special Redemption Price payable on such date
will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay)
except that, if such Business Day falls in the next calendar year, such
payment will be made on the immediately preceding Business Day, in each
case with the same force and effect as if made on such date fixed for
redemption. If payment of the Redemption Price or Special Redemption
Price in respect of any Securities is improperly withheld or refused
and not paid either by the Trust or by the Debenture Issuer as
guarantor pursuant to the Guarantee, Distributions on such Securities
will continue to accrue at the Coupon Rate from the original redemption
date to the actual date of payment, in which case the actual payment
date will be considered the date fixed for redemption for purposes of
calculating the Redemption Price or Special Redemption Price. In the
event of any redemption of the Capital Securities issued by the Trust
in part, the Trust shall not be required to (i) issue, register the
transfer of or exchange any Security during a period beginning at the
opening of business 15 days before any selection for redemption of the
Capital Securities and ending at the close of business on the earliest
date on which the relevant notice of redemption is deemed to have been
given to all Holders of the Capital Securities to be so redeemed or
(ii) register the transfer of or exchange any Capital Securities so
selected for redemption, in whole or in part except for the unredeemed
portion of any Capital Securities being redeemed in part.
(iii) Redemption/Distribution Notices shall be sent
by the Administrators on behalf of the Trust to (A) in respect of the
Capital Securities, the Holders thereof and (B) in respect of the
Common Securities, the Holder thereof.
5. VOTING RIGHTS - CAPITAL SECURITIES.
(a) Except as provided under paragraphs 5(b) and 7 and as
otherwise required by law and the Declaration, the Holders of the Capital
Securities will have no voting rights. The Administrators are required to call
a meeting of the Holders of the Capital Securities if directed to do so by
Holders of at least 10% in liquidation amount of the Capital Securities.
(b) Subject to the requirements of obtaining a tax opinion
by the Institutional Trustee in certain circumstances set forth in the last
sentence of this paragraph, the Holders of a Majority in liquidation amount of
the Capital Securities, voting separately as a class, have the right to direct
the time, method, and place of conducting any proceeding for any remedy
available to the Institutional Trustee, or exercising any trust or power
conferred upon the Institutional Trustee under the Declaration, including the
right to direct the Institutional Trustee, as holder of the Debentures, to (i)
exercise the remedies available under the Indenture as the holder of the
Debentures, (ii) waive any past default that is waivable under the Indenture,
(iii) exercise any right to rescind or annul a declaration that the principal
of all the Debentures shall be due and payable or (iv) consent on behalf of
all the Holders of the Capital Securities to any amendment, modification or
termination of the Indenture or the Debentures where such consent shall be
required; PROVIDED, HOWEVER, that, where a consent or action under the
Indenture would require the consent or act of the holders of greater than a
simple majority in aggregate principal amount of Debentures (a "SUPER
MAJORITY") affected thereby, the Institutional Trustee may only give such
consent or take such action at the written direction of the Holders of at
least the proportion in liquidation amount of the Capital Securities
outstanding which the relevant Super Majority represents of the aggregate
principal amount of the Debentures outstanding. If the Institutional Trustee
fails to enforce its rights under the Debentures after the Holders of a
Majority in liquidation amount of such Capital Securities have so directed the
Institutional Trustee, to the fullest extent permitted by law, a Holder of the
Capital Securities may institute a legal proceeding directly against the
Debenture Issuer to enforce the Institutional Trustee's
C-8
rights under the Debentures without first instituting any legal proceeding
against the Institutional Trustee or any other person or entity.
Notwithstanding the foregoing, if an Event of Default has occurred and is
continuing and such event is attributable to the failure of the Debenture
Issuer to pay interest or principal on the Debentures on the date the interest
or principal is payable (or in the case of redemption, the redemption date),
then a Holder of record of the Capital Securities may directly institute a
proceeding for enforcement of payment on or after the respective due dates
specified in the Debentures, to such Holder directly of the principal of or
interest on the Debentures having an aggregate principal amount equal to the
aggregate liquidation amount of the Capital Securities of such Holder. The
Institutional Trustee shall notify all Holders of the Capital Securities of
any default actually known to the Institutional Trustee with respect to the
Debentures unless (x) such default has been cured prior to the giving of such
notice or (y) the Institutional Trustee determines in good faith that the
withholding of such notice is in the interest of the Holders of such Capital
Securities, except where the default relates to the payment of principal of or
interest on any of the Debentures. Such notice shall state that such Indenture
Event of Default also constitutes an Event of Default hereunder. Except with
respect to directing the time, method and place of conducting a proceeding for
a remedy, the Institutional Trustee shall not take any of the actions
described in clauses (i), (ii) or (iii) above unless the Institutional Trustee
has obtained an opinion of tax counsel to the effect that, as a result of such
action, the Trust will not be classified as other than a grantor trust for
United States federal income tax purposes.
In the event the consent of the Institutional Trustee, as the holder
of the Debentures is required under the Indenture with respect to any
amendment, modification or termination of the Indenture, the Institutional
Trustee shall request the direction of the Holders of the Securities with
respect to such amendment modification or termination and shall vote with
respect to such amendment, modification or termination as directed by a
Majority in liquidation amount of the Securities voting together as a single
class; PROVIDED, HOWEVER, that where a consent under the Indenture would
require the consent of a Super-Majority, the Institutional Trustee may only
give such consent at the direction of the Holders of at least the proportion
in liquidation amount of such Trust Securities outstanding which the relevant
Super-Majority represents of the aggregate principal amount of the Debentures
outstanding. The Institutional Trustee shall not take any such action in
accordance with the directions of the Holders of the Securities unless the
Institutional Trustee has obtained an opinion of tax counsel to the effect
that, as a result of such action, the Trust will not be classified as other
than a grantor trust for United States federal income tax purposes.
A waiver of an Indenture Event of Default will constitute a waiver of
the corresponding Event of Default hereunder. Any required approval or
direction of Holders of the Capital Securities may be given at a separate
meeting of Holders of the Capital Securities convened for such purpose, at a
meeting of all of the Holders of the Securities in the Trust or pursuant to
written consent. The Institutional Trustee will cause a notice of any meeting
at which Holders of the Capital Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of the Capital Securities. Each such notice
will include a statement setting forth the following information (i) the date
of such meeting or the date by which such action is to be taken, (ii) a
description of any resolution proposed for adoption at such meeting on which
such Holders are entitled to vote or of such matter upon which written consent
is sought and (iii) instructions for the delivery of proxies or consents. No
vote or consent of the Holders of the Capital Securities will be required for
the Trust to redeem and cancel Capital Securities or to distribute the
Debentures in accordance with the Declaration and the terms of the Securities.
Notwithstanding that Holders of the Capital Securities are entitled
to vote or consent under any of the circumstances described above, any of the
Capital Securities that are owned by the Sponsor or any Affiliate of the
Sponsor shall not entitle the Holder thereof to vote or consent and shall, for
purposes of such vote or consent, be treated as if such Capital Securities
were not outstanding.
C-9
In no event will Holders of the Capital Securities have the right to
vote to appoint, remove or replace the Administrators, which voting rights are
vested exclusively in the Sponsor as the Holder of all of the Common
Securities of the Trust. Under certain circumstances as more fully described
in the Declaration, Holders of Capital Securities have the right to vote to
appoint, remove or replace the Institutional Trustee.
6. VOTING RIGHTS - COMMON SECURITIES.
(a) Except as provided under paragraphs 6(b), 6(c) and 7 and
as otherwise required by law and the Declaration, the Common Securities will
have no voting rights.
(b) The Holders of the Common Securities are entitled, in
accordance with Article IV of the Declaration, to vote to appoint, remove or
replace any Administrators.
(c) Subject to Section 6.7 of the Declaration and only after
each Event of Default (if any) with respect to the Capital Securities has been
cured, waived, or otherwise eliminated and subject to the requirements of the
second to last sentence of this paragraph, the Holders of a Majority in
liquidation amount of the Common Securities, voting separately as a class, may
direct the time, method, and place of conducting any proceeding for any remedy
available to the Institutional Trustee, or exercising any trust or power
conferred upon the Institutional Trustee under the Declaration, including (i)
directing the time, method, place of conducting any proceeding for any remedy
available to the Debenture Trustee, or exercising any trust or power conferred
on the Debenture Trustee with respect to the Debentures, (ii) waive any past
default and its consequences that is waivable under the Indenture, or (iii)
exercise any right to rescind or annul a declaration that the principal of all
the Debentures shall be due and payable; PROVIDED, HOWEVER, that, where a
consent or action under the Indenture would require a Super Majority, the
Institutional Trustee may only give such consent or take such action at the
written direction of the Holders of at least the proportion in liquidation
amount of the Common Securities which the relevant Super Majority represents
of the aggregate principal amount of the Debentures outstanding.
Notwithstanding this paragraph 6(c), the Institutional Trustee shall not
revoke any action previously authorized or approved by a vote or consent of
the Holders of the Capital Securities. Other than with respect to directing
the time, method and place of conducting any proceeding for any remedy
available to the Institutional Trustee or the Debenture Trustee as set forth
above, the Institutional Trustee shall not take any action described in (i),
(ii) or (iii) above, unless the Institutional Trustee has obtained an opinion
of tax counsel to the effect that for the purposes of United States federal
income tax the Trust will not be classified as other than a grantor trust on
account of such action. If the Institutional Trustee fails to enforce its
rights under the Declaration to the fullest extent permitted by law, any
Holder of the Common Securities may institute a legal proceeding directly
against any Person to enforce the Institutional Trustee's rights under the
Declaration, without first instituting a legal proceeding against the
Institutional Trustee or any other Person.
Any approval or direction of Holders of the Common Securities may be
given at a separate meeting of Holders of the Common Securities convened for
such purpose, at a meeting of all of the Holders of the Securities in the
Trust or pursuant to written consent. The Administrators will cause a notice
of any meeting at which Holders of the Common Securities are entitled to vote,
or of any matter upon which action by written consent of such Holders is to be
taken, to be mailed to each Holder of the Common Securities. Each such notice
will include a statement setting forth (i) the date of such meeting or the
date by which such action is to be taken, (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to
vote or of such matter upon which written consent is sought and (iii)
instructions for the delivery of proxies or consents.
C-10
No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
the Debentures in accordance with the Declaration and the terms of the
Securities.
7. AMENDMENTS TO DECLARATION AND INDENTURE.
(a) In addition to any requirements under Section 11.1 of
the Declaration, if any proposed amendment to the Declaration provides for, or
the Trustees, Sponsor or Administrators otherwise propose to effect, (i) any
action that would adversely affect the powers, preferences or special rights
of the Securities, whether by way of amendment to the Declaration or
otherwise, or (ii) the Liquidation of the Trust, other than as described in
Section 7.1 of the Declaration, then the Holders of outstanding Securities,
voting together as a single class, will be entitled to vote on such amendment
or proposal and such amendment or proposal shall not be effective except with
the approval of the Holders of at least a Majority in liquidation amount of
the Securities, affected thereby; PROVIDED, HOWEVER, if any amendment or
proposal referred to in clause (i) above would adversely affect only the
Capital Securities or only the Common Securities, then only the affected class
will be entitled to vote on such amendment or proposal and such amendment or
proposal shall not be effective except with the approval of a Majority in
liquidation amount of such class of Securities.
(b) In the event the consent of the Institutional Trustee as
the holder of the Debentures is required under the Indenture with respect to
any amendment, modification or termination of the Indenture or the Debentures,
the Institutional Trustee shall request the written direction of the Holders
of the Securities with respect to such amendment, modification or termination
and shall vote with respect to such amendment, modification, or termination as
directed by a Majority in liquidation amount of the Securities voting together
as a single class; PROVIDED, HOWEVER, that where a consent under the Indenture
would require a Super Majority, the Institutional Trustee may only give such
consent at the direction of the Holders of at least the proportion in
liquidation amount of the Securities which the relevant Super Majority
represents of the aggregate principal amount of the Debentures outstanding.
(c) Notwithstanding the foregoing, no amendment or
modification may be made to the Declaration if such amendment or modification
would (i) cause the Trust to be classified for purposes of United States
federal income taxation as other than a grantor trust, (ii) reduce or
otherwise adversely affect the powers of the Institutional Trustee or (iii)
cause the Trust to be deemed an Investment Company which is required to be
registered under the Investment Company Act.
(d) Notwithstanding any provision of the Declaration, the
right of any Holder of the Capital Securities to receive payment of
distributions and other payments upon redemption or otherwise, on or after
their respective due dates, or to institute a suit for the enforcement of any
such payment on or after such respective dates, shall not be impaired or
affected without the consent of such Holder. For the protection and
enforcement of the foregoing provision, each and every Holder of the Capital
Securities shall be entitled to such relief as can be given either at law or
equity.
8. PRO RATA. A reference in these terms of the Securities to any
payment, distribution or treatment as being "Pro Rata" shall mean pro rata to
each Holder of the Securities according to the aggregate liquidation amount of
the Securities held by the relevant Holder in relation to the aggregate
liquidation amount of all Securities then outstanding unless, in relation to a
payment, an Event of Default has occurred and is continuing, in which case any
funds available to make such payment shall be paid first to each Holder of the
Capital Securities Pro Rata according to the aggregate
C-11
liquidation amount of the Capital Securities held by the relevant Holder
relative to the aggregate liquidation amount of all Capital Securities
outstanding, and only after satisfaction of all amounts owed to the Holders of
the Capital Securities, to each Holder of the Common Securities Pro Rata
according to the aggregate liquidation amount of the Common Securities held by
the relevant Holder relative to the aggregate liquidation amount of all Common
Securities outstanding.
9. RANKING. The Capital Securities rank PARI PASSU with and payment
thereon shall be made Pro Rata with the Common Securities except that, where
an Event of Default has occurred and is continuing, the rights of Holders of
the Common Securities to receive payment of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights of the
Holders of the Capital Securities with the result that no payment of any
Distribution on, or Redemption Price of, any Common Security, and no other
payment on account of redemption, liquidation or other acquisition of Common
Securities, shall be made unless payment in full in cash of all accumulated
and unpaid Distributions on all outstanding Capital Securities for all
distribution periods terminating on or prior thereto, or in the case of
payment of the Redemption Price the full amount of such Redemption Price on
all outstanding Capital Securities then called for redemption, shall have been
made or provided for, and all funds immediately available to the Institutional
Trustee shall first be applied to the payment in full in cash of all
Distributions on, or the Redemption Price of, the Capital Securities then due
and payable.
10. ACCEPTANCE OF GUARANTEE AND INDENTURE. Each Holder of the Capital
Securities and the Common Securities, by the acceptance of such Securities,
agrees to the provisions of the Guarantee, including the subordination
provisions therein and to the provisions of the Indenture.
11. NO PREEMPTIVE RIGHTS. The Holders of the Securities shall have no
preemptive or similar rights to subscribe for any additional securities.
12. MISCELLANEOUS. These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the Guarantee, and the
Indenture to a Holder without charge on written request to the Sponsor at its
principal place of business.
▇-▇▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CAPITAL SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY
ONLY (A) TO THE SPONSOR OR THE TRUST, (B) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A SO LONG AS THIS SECURITY IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A IN ACCORDANCE WITH RULE 144A, (C) TO A NON-U.S.
PERSON IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS
APPLICABLE) OF REGULATION S UNDER THE SECURITIES ACT, (D) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR
(7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS CAPITAL
SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE SPONSOR'S AND
THE TRUST'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM IN ACCORDANCE WITH THE DECLARATION OF TRUST, A
COPY OF WHICH MAY BE OBTAINED FROM THE SPONSOR OR THE TRUST. THE HOLDER OF
THIS SECURITY AGREES THAT IT WILL COMPLY WITH THE FOREGOING RESTRICTIONS.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATE AND OTHER INFORMATION AS MAY BE
REQUIRED BY THE DECLARATION TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE
FOREGOING RESTRICTIONS.
A-1-1
Certificate Number Number of Capital Securities
Certificate Evidencing Capital Securities of
of
First Community/CA Statutory Trust I
(liquidation amount $ 1,000 per Capital Security)
First Community/CA Statutory Trust I, a statutory trust created under
the laws of the State of Connecticut (the "Trust"), hereby certifies that
Preferred Term Securities, Ltd. (the "Holder") is the registered owner of
securities of the Trust representing undivided beneficial interests in the
assets of the Trust, (liquidation amount $1,000 per capital security) (the
"Capital Securities"). Subject to the Declaration (as defined below), the
Capital Securities are transferable on the books and records of the Trust in
person or by a duly authorized attorney, upon surrender of this Certificate
duly endorsed and in proper form for transfer. The designation, rights,
privileges, restrictions, preferences and other terms and provisions of the
Capital Securities represented hereby are issued pursuant to, and shall in all
respects be subject to, the provisions of the Amended and Restated Declaration
of Trust of the Trust dated as of September 7, 2000, among ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and
▇▇▇▇▇▇ ▇. ▇▇▇▇ as Administrators, State Street Bank and Trust Company of
Connecticut, National Association, as Institutional Trustee, First Community
Bancorp, as Sponsor, and the holders from time to time of undivided beneficial
interests in the assets of the Trust, including the designation of the terms
of the Capital Securities as set forth in Annex I to the Declaration of Trust
dated September 7, 2000 as the same may be amended from time to time (the
"Declaration"). Capitalized terms used herein but not defined shall have the
meaning given them in the Declaration. The Holder is entitled to the benefits
of the Guarantee to the extent provided therein. The Sponsor will provide a
copy of the Declaration, the Guarantee, and the Indenture to the Holder
without charge upon written request to the Trust at its principal place of
business.
Upon receipt of this Security, the Holder is bound by the Declaration
and is entitled to the benefits thereunder.
By acceptance of this Security, the Holder agrees to treat, for
United States federal income tax purposes, the Debentures as indebtedness and
the Capital Securities as evidence of beneficial ownership in the Debentures.
This Capital Security is governed by, and construed in accordance
with, the laws of the State of Connecticut, without regard to principles of
conflict of laws.
IN WITNESS WHEREOF, the Trust has duly executed this certificate.
First Community/CA Statutory Trust I
By:
-------------------------------------
Name:
Title: Administrator
Dated: September 7, 2000
A-1-2
CERTIFICATE OF AUTHENTICATION
This is one of the Capital Securities referred to in the within-
mentioned Declaration.
STATE STREET BANK AND TRUST COMPANY OF
CONNECTICUT, NATIONAL ASSOCIATION, as the
Institutional Trustee
By:
-------------------------------------
Authorized Officer
A-1-3
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Capital Security will be payable at an
annual rate of 10.60% (the "Coupon Rate") of the stated liquidation amount of
$1,000 per Capital Security, such rate being the rate of interest payable on
the Debentures to be held by the Institutional Trustee. Distributions in
arrears for more than a semi-annual period will bear interest thereon
compounded semi-annually at the Coupon Rate (to the extent permitted by
applicable law). The term "Distributions" as used herein includes interest
payments (including Additional Interest and principal on the Debentures held
by the Institutional Trustee) and any such compounded interest payable on the
Debentures unless otherwise stated. A Distribution is payable only to the
extent that payments are made in respect of the Debentures held by the
Institutional Trustee and to the extent the Institutional Trustee has funds
available therefor. The amount of Distributions payable for any period will be
computed for any full semi-annual Distribution period on the basis of a
360-day year of twelve 30-day months.
Except as otherwise described below, Distributions on the Capital
Securities will be cumulative, will accrue from the date of original issuance
and will be payable semi-annually in arrears on March 7 and September 7 of
each year, commencing on March 7, 2001. The Debenture Issuer has the right
under the Indenture to defer payments of interest on the Debentures by
extending the interest payment period for up to 10 consecutive semi-annual
periods (each an "Extension Period") on the Debentures, subject to the
conditions described below, although such interest would continue to accrue on
the Debentures at an annual rate equal to the Coupon Rate compounded
semi-annually to the extent permitted by law during any Extension Period. No
Extension Period may end on a date other than an interest Payment Date. At the
end of any such Extension Period the Sponsor shall pay all interest then
accrued and unpaid on the Debt Securities (together with Additional Interest
thereon); PROVIDED, HOWEVER, that no Extension Period may extend beyond the
Maturity Date. Prior to the termination of any Extension Period, the Sponsor
may further extend such period, provided that such period together with all
such previous and further consecutive extensions thereof shall not exceed 10
consecutive semi-annual periods, or extend beyond the Maturity Date. Upon the
termination of any Extension Period and upon the payment of all accrued and
unpaid interest and Additional Interest, the Sponsor may commence a new
Extension Period, subject to the foregoing requirements. No interest or
Additional Interest shall be due and payable during an Extension Period,
except at the end thereof, but each installment of interest that would
otherwise have been due and payable during such Extension Period shall bear
Additional Interest. If Distributions are deferred, the Distributions due
shall be paid on the date that the related Extension Period terminates, to
Holders of the Securities as they appear on the books and records of the Trust
on the record date immediately preceding such date. Distributions on the
Securities must be paid on the dates payable (after giving effect to any
Extension Period) to the extent that the Trust has funds available for the
payment of such distributions in the Property Account of the Trust. The
Trust's funds available for Distribution to the Holders of the Securities will
be limited to payments received from the Debenture Issuer. The payment of
Distributions out of moneys held by the Trust is guaranteed by the Guarantor
pursuant to the Guarantee.
The Capital Securities shall be redeemable as provided in the
Declaration.
A-1-4
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital
Security Certificate to:
---------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
---------------------------------------------------------------------
---------------------------------------------------------------------
(Insert address and zip code of assignee) and irrevocably appoints
---------------------------------------------------------------------
agent to transfer this Capital Security Certificate on the books of the
Trust. The agent may substitute another to act for him or her.
Date:
----------------------------
Signature:
-----------------------
(Sign exactly as your name appears on the other side of this Capital
Security Certificate)
Signature Guarantee:1
--------
1 Signature must be guaranteed by an "eligible guarantor institution" that is
a bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Security registrar, which requirements include membership
or participation in the Securities Transfer Agents Medallion Program ("STAMP")
or such other "signature guarantee program" as may be determined by the
Security registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF COMMON SECURITY CERTIFICATE
THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION.
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT IN COMPLIANCE WITH
SECTION 8.1 OF THE DECLARATION.
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
First Community/CA Statutory Trust I
First Community/CA Statutory Trust I, a statutory trust created under
the laws of the State of Connecticut (the "Trust"), hereby certifies that
First Community Bancorp (the "Holder") is the registered owner of common
securities of the Trust representing undivided beneficial interests in the
assets of the Trust (the "Common Securities"). The designation, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities represented hereby are issued pursuant to, and shall in all
respects be subject to, the provisions of the Amended and Restated Declaration
of Trust of the Trust dated as of September 7, 2000, among ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and
▇▇▇▇▇▇ ▇. ▇▇▇▇, as Administrators, State Street Bank and Trust Company of
Connecticut, National Association, as Institutional Trustee, First Community
Bancorp as Sponsor and the holders from time to time of undivided beneficial
interest in the assets of the Trust including the designation of the terms of
the Common Securities as set forth in Annex I to the Declaration, as the same
may be amended from time to time (the "Declaration"). Capitalized terms used
herein but not defined shall have the meaning given them in the Declaration.
The Holder is entitled to the benefits of the Guarantee to the extent provided
therein. The Sponsor will provide a copy of the Declaration, the Guarantee and
the Indenture to the Holder without charge upon written request to the Sponsor
at its principal place of business.
As set forth in the Declaration, where an Event of Default has
occurred and continuing, the rights of Holders of Common Securities to payment
in respect of Distributions and payments upon Liquidation, redemption or
otherwise are subordinated to the rights of payment of Holders of the Capital
Securities.
Upon receipt of this Certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance of this Certificate, the Holder agrees to treat, for
United States federal income tax purposes, the Debentures as indebtedness and
the Common Securities as evidence of undivided beneficial ownership in the
Debentures.
This Common Security is governed by, and construed in accordance
with, the laws of the State of Connecticut, without regard to principles of
conflict of laws.
A-2-1
IN WITNESS WHEREOF, the Trust has executed this certificate this 7th
day of September, 2000.
FIRST COMMUNITY/CA STATUTORY TRUST I
By:
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Name:
Title: Administrator
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[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be identical in
amount to the Distributions payable on each Capital Security, which is at an
annual rate of 10.60% (the "Coupon Rate") of the stated liquidation amount of
$1,000 per Capital Security, such rate being the rate of interest payable on
the Debentures to be held by the Institutional Trustee. Distributions in
arrears for more than one period will bear interest thereon compounded at the
Coupon Rate (to the extent permitted by applicable law). The term
"Distributions" as used herein includes interest payments (including
Additional Interest and principal on the Debentures held by the Institutional
Trustee) and any such compounded interest payable on the Debentures unless
otherwise stated. A Distribution is payable only to the extent that payments
are made in respect of the Debentures held by the Institutional Trustee and to
the extent the Institutional Trustee has funds available therefor. The amount
of Distributions payable for any period will be computed for any full
semi-annual Distribution period on 360-day year of twelve 30-day months.
Except as otherwise described below, Distributions on the Common
Securities will be cumulative, will accrue from the date of original issuance
and will be payable semi-annually in arrears on March 7 and September 7 of
each year, commencing on March 7, 2001. The Debenture Issuer has the right
under the Indenture to defer payments of interest on the Debentures by
extending the interest payment period for up to 10 consecutive semi-annual
periods (each an "Extension Period") on the Debentures, subject to the
conditions described below, although such interest would continue to accrue on
the Debentures at an annual rate equal to the Coupon Rate compounded
semi-annually to the extent permitted by law during any Extension Period. No
Extension Period may end on a date other than an Interest Payment Date. At the
end of any such Extension Period the Sponsor shall pay all interest then
accrued and unpaid on the Debt Securities (together with Additional Interest
thereon); PROVIDED, HOWEVER, that no Extension Period may extend beyond the
Maturity Date. Prior to the termination of any Extension Period, the Sponsor
may further extend such period, provided that such period together with all
such previous and further consecutive extensions thereof shall not exceed 10
consecutive semi-annual periods, or extend beyond the Maturity Date. Upon the
termination of any Extension Period and upon the payment of all accrued and
unpaid interest and Additional Interest, the Sponsor may commence a new
Extension Period, subject to the foregoing requirements. No interest or
Additional Interest shall be due and payable during an Extension Period,
except at the end thereof, but each installment of interest that would
otherwise have been due and payable during such Extension Period shall bear
Additional Interest. If Distributions are deferred, the Distributions due
shall be paid on the date that the related Extension Period terminates, to
Holders of the Securities as they appear on the books and records of the Trust
on the record date immediately preceding such date. Distributions on the
Securities must be paid on the dates payable (after giving effect to any
Extension Period) to the extent that the Trust has funds available for the
payment of such distributions in the Property Account of the Trust. The
Trust's funds available for Distribution to the Holders of the Securities will
be limited to payments received from the Debenture Issuer. The payment of
Distributions out of moneys held by the Trust is guaranteed by the Guarantor
pursuant to the Guarantee.
The Common Securities shall be redeemable as provided in the
Declaration.
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ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common
Security Certificate 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 Common Security Certificate on the
books of the Trust. The agent may substitute another to act
for him or her.
Date:
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Signature:
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(Sign exactly as your name appears on the other side of this
Common Security Certificate)
Signature:
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(Sign exactly as your name appears on the other side of this
common Security Certificate)
Signature Guarantee2
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2 Signature must be guaranteed by an "eligible guarantor institution" that is a
bank, stockbroker, savings and loan association or credit union, meeting the
requirements of the Security registrar, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Security
registrar in addition to, or in substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934, as amended.
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EXHIBIT B
SPECIMEN OF INITIAL DEBENTURE
B-1
EXHIBIT C
PLACEMENT AGREEMENT
C-1