EXHIBIT 4.4
Form of
CAPITAL SECURITIES GUARANTEE AGREEMENT
Between
NATIONWIDE FINANCIAL SERVICES, INC.
(As Guarantor)
and
WILMINGTON TRUST COMPANY
(As Capital Securities Guarantee Trustee)
Dated as of _____ __, 1997
TABLE OF CONTENTS
Page
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ARTICLE I
Definitions and Interpretation
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SECTION 1.01. Definitions and Interpretation............... 1
ARTICLE II
Trust Indenture Act
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SECTION 2.01. Trust Indenture Act; Application................ 5
SECTION 2.02. Lists of Holders of Securities.................. 5
SECTION 2.03. Reports by the Capital Securities
Guarantee Trustee............................... 5
SECTION 2.04. Periodic Reports to Capital
Securities Guarantee Trustee.................... 6
SECTION 2.05. Evidence of Compliance with
Conditions Precedent............................ 6
SECTION 2.06. Events of Default; Waiver....................... 6
SECTION 2.07. Event of Default; Notice........................ 6
SECTION 2.08. Conflicting Interests........................... 7
ARTICLE III
Powers, Duties and Rights of
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Capital Securities Guarantee Trustee
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SECTION 3.01. Powers and Duties of the Capital
Securities Guarantee Trustee.................... 7
SECTION 3.02. Certain Rights of Capital
Securities Guarantee Trustee.................... 9
SECTION 3.03. Not Responsible for Recitals or
Issuance of Guarantee........................... 11
ARTICLE IV
Capital Securities Guarantee Trustee
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SECTION 4.01. Capital Securities Guarantee
Trustee; Eligibility............................ 12
SECTION 4.02. Appointment, Removal and
Resignation of Capital Securities
Guarantee Trustee............................... 12
ARTICLE V
Guarantee
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SECTION 5.01. Guarantee....................................... 14
SECTION 5.02. Subordination................................... 14
SECTION 5.03. Waiver of Notice and Demand..................... 14
SECTION 5.04. Obligations Not Affected........................ 14
SECTION 5.05. Rights of Holders............................... 15
SECTION 5.06. Guarantee of Payment............................ 16
SECTION 5.07. Subrogation..................................... 16
SECTION 5.08. Independent Obligations......................... 16
ARTICLE VI
Limitation of Transactions; Subordination
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SECTION 6.01. Limitations of Transactions..................... 16
SECTION 6.02. Ranking......................................... 17
ARTICLE VII
Termination
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SECTION 7.01. Termination..................................... 17
ARTICLE VIII
Indemnification
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SECTION 8.01. Exculpation..................................... 18
SECTION 8.02. Indemnification................................. 18
ARTICLE IX
Miscellaneous
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SECTION 9.01. Successors and Assigns.......................... 19
SECTION 9.02. Amendments...................................... 19
SECTION 9.03. Notices......................................... 19
SECTION 9.04. Benefit......................................... 20
SECTION 9.05. Governing Law................................... 20
THIS CAPITAL SECURITIES GUARANTEE AGREEMENT ("Capital Securities
Guarantee"), dated as of _______, 1997, is executed and delivered by NATIONWIDE
FINANCIAL SERVICES, INC., a Delaware corporation (the "Guarantor"), and
WILMINGTON TRUST COMPANY, a Delaware banking corporation, as trustee (the
"Capital Securities Guarantee Trustee"), for the benefit of the Holders (as
defined herein) from time to time of the Capital Securities (as defined herein)
of NATIONWIDE FINANCIAL SERVICES CAPITAL TRUST, a Delaware statutory business
trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of _______, 1997, among the trustees of the Issuer
named therein, the Guarantor, as Sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing on the date hereof Capital Securities having an aggregate stated
liquidation preference of $___________, designated the __% Capital Securities
(the "Capital Securities"); and
WHEREAS as incentive for the Holders to purchase the Capital
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Capital Securities Guarantee, to pay to the Holders
of the Capital Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Capital Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Capital Securities Guarantee
for the benefit of the Holders.
ARTICLE I
Definitions and Interpretation
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SECTION 1.01. Definitions and Interpretation. In this Capital
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Securities Guarantee, unless the context otherwise requires:
(a) capitalized terms used in this Capital Securities Guarantee but
not defined in the preamble above have the respective meanings assigned to
them in this Section 1.01;
(b) a term defined anywhere in this Capital Securities Guarantee has
the same meaning throughout;
(c) all references to "the Capital Securities Guarantee" or "this
Guarantee" are to this Capital Securities Guarantee as modified,
supplemented or amended from time to time;
(d) all references in this Capital Securities Guarantee to Articles
and Sections are to Articles and Sections of this Capital Securities
Guarantee unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Capital Securities Guarantee unless otherwise defined in
this Capital Securities Guarantee or unless the context otherwise requires;
and
(f) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405 of
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the Securities Act of 1933, as amended, or any successor rule thereunder.
"Common Securities" means the common securities representing common
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undivided beneficial interest in the assets of the Issuer.
"Covered Person" means any Holder or beneficial owner of Capital
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Securities.
"Debentures" means the series of junior subordinated debt securities
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of the Guarantor designated the __% Junior Subordinated Deferrable Interest
Debentures Due 2037 hold by the Property Trustee of the Issuer.
"Event of Default" means a default by the Guarantor on any of its
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payment or other obligations under this Capital Securities Guarantee.
"Guarantee Payments" means the following payments or distributions,
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without duplication, with respect to the Capital Securities, to the extent not
paid or made by or on behalf of the Issuer: (i) any accrued and unpaid
Distributions (as defined in the Declaration) that are required to be paid on
such Capital Securities to the extent the Issuer shall have funds available
therefor, (ii) the amount payable upon redemption to the extent the Issuer has
funds available therefor, with respect to any Capital Securities called for
redemption by the Issuer, and (iii) upon a voluntary or involuntary dissolution,
winding-up or termination of the Issuer (other than in connection with the
distribution of Debentures to the Holders in exchange for Capital Securities as
provided in the Declaration), the
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lesser of (a) the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Capital Securities to the date of payment, to the extent
the Issuer shall have funds available therefor, and (b) the amount of assets of
the Issuer remaining available for distribution to Holders upon liquidation of
the Issuer (in either case, the "Liquidation Distribution"). If an event of
default under the Indenture has occurred and is continuing, the rights of
holders of the Common Securities to receive payments as provided in the
Declaration are subordinated to the rights of Holders of Capital Securities to
receive Guarantee Payments.
"Holder" means any holder, as registered on the books and records of
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the Issuer of any Capital Securities; provided, however, that, in determining
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whether the holders of the requisite percentage of Capital Securities have given
any request, notice, consent or waiver hereunder, "Holder" shall not include the
Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Capital Securities Guarantee Trustee,
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any Affiliate of the Capital Securities Guarantee Trustee, or any officers,
directors, shareholders, members, partners, employees, representatives or agents
of the Capital Securities Guarantee Trustee.
"Indenture" means the Indenture dated as of
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_________, 1997, among the Guarantor (the "Debenture Issuer") and Wilmington
Trust Company, as trustee, and any indenture supplemental thereto pursuant to
which the Debentures are to be issued to the Property Trustee of the Issuer.
"Majority in liquidation preference of the Capital Securities" means,
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except as provided by the Trust Indenture Act, Holder(s) of Capital Securities,
voting separately as a class, representing more than 50% of the stated
liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of all Capital
Securities then outstanding.
"Officers' Certificate" means, with respect to any Person, a
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certificate signed by the Chairman of the Board, President or a Vice President,
and by the Treasurer, an Assistant Treasurer, the Controller, the Secretary or
an Assistant Secretary of such Person, and delivered to the Preferred Guarantee
Trustee. Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Capital Securities Guarantee shall
include:
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(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
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estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated organization or association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Capital Securities Guarantee Trustee" means Wilmington Trust Company until
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a Successor Capital Securities Guarantee Trustee has been appointed and has
accepted such appointment pursuant to the terms of this Capital Securities
Guarantee and thereafter means each such Successor Capital Securities Guarantee
Trustee.
"Responsible Officer" means, with respect to the Capital Securities
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Guarantee Trustee, the chairman of the board of directors, the president, any
vice-president, any assistant vice-president, the secretary, any assistant
secretary, the treasurer, any assistant treasurer, any trust officer or
assistant trust officer or any other officer of the Capital Securities Guarantee
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.
"Successor Capital Securities Guarantee Trustee" means a successor Capital
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Securities Guarantee Trustee possessing the qualifications to act as Capital
Securities Guarantee Trustee under Section 4.01. Any entity that engages in a
merger, conversion or consolidation with, or acquires all or substantially all
of the corporate trust business of, a Capital Securities Guarantee Trustee shall
be a Successor Capital Securities Guarantee Trustee.
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"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
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ARTICLE II
Trust Indenture Act
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SECTION 2.01. Trust Indenture Act; Application. (a) This Capital
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Securities Guarantee is subject to the provisions of the Trust Indenture Act
that are required to be part of this Capital Securities Guarantee, which are
incorporated by reference hereto, and shall, to the extent applicable, be
governed by such provisions; and
(b) If and to the extent that any provision of this Capital Securities
Guarantee limits, qualifies or conflicts with the duties imposed by Sections 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
SECTION 2.02. Lists of Holders of Securities. (a) The Guarantor
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shall provide the Capital Securities Guarantee Trustee (i) within 14 days after
each record date for the payment of Distributions (as defined in the
Declaration), a list, in such form as the Capital Securities Guarantee Trustee
may reasonably require, of the names and addresses of the Holders of the Capital
Securities ("List of Holders") as of such date; provided that the Guarantor
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shall not be obligated to provide such List of Holders at any time the List of
Holders does not differ from the most recent List of Holders given to the
Capital Securities Guarantee Trustee by the Guarantor, and (ii) at any other
time, within 30 days of receipt by the Guarantor of a written request for a List
of Holders as of a date no more than 14 days before such List of Holders is
given to the Capital Securities Guarantee Trustee. The Capital Securities
Guarantee Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
(b) The Capital Securities Guarantee Trustee shall comply with its
obligations under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.03. Reports by the Capital Securities Guarantee Trustee.
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Within 60 days after May 15 of each year, the Capital Securities Guarantee
Trustee shall provide to the Holders of the Capital Securities such reports as
are required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The Capital
Securities Guarantee Trustee shall also comply with the requirements of Section
313(d) of the Trust Indenture Act.
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SECTION 2.04. Periodic Reports to Capital Securities Guarantee
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Trustee. The Guarantor shall provide to the Capital Securities Guarantee
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Trustee, the Securities and Exchange Commission and the Holders such documents,
reports and information as required by Section 314 (if any) and the compliance
certificate required by Section 314 of the Trust Indenture Act in the form, in
the manner and at the times required by Section 314 of the Trust Indenture Act.
SECTION 2.05. Evidence of Compliance with Conditions Precedent. The
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Guarantor shall provide to the Capital Securities Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Capital Securities Guarantee which relate to any of the matters set forth
in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given in
the form of an Officers' Certificate.
SECTION 2.06. Events of Default; Waiver. The Holders of a Majority
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in liquidation amount of the Capital Securities may, by vote, on behalf of the
Holders of all of the Capital Securities, waive any past Event of Default and
its consequences. Upon such waiver, any such Event of Default shall cease to
exist, and any Event of Default arising therefrom shall be deemed to have been
cured, for every purpose of this Capital Securities Guarantee, but no such
waiver shall extend to any subsequent or other default or Event of Default or
impair any right consequent therefrom.
SECTION 2.07. Event of Default; Notice. (a) The Capital Securities
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Guarantee Trustee shall, within 90 days after the occurrence of an Event of
Default, transmit by mail, first class postage prepaid, to the Holders of the
Capital Securities, notices of all Events of Default known to the Capital
Securities Guarantee Trustee, unless such defaults have been cured before the
giving of such notice; provided that except in the case of a default in the
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payment of a Guarantee Payment, the Capital Securities Guarantee Trustee shall
be protected in withholding such notice if and so long as the board of
directors, the executive committee, or a trust committee of directors and/or
Responsible Officers of the Capital Securities Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders of the Capital Securities.
(b) The Capital Securities Guarantee Trustee shall not be deemed to
have knowledge of any Event of Default except any Event of Default as to which
the Capital Securities Guarantee Trustee shall have received written notice or a
Responsible Officer charged with the
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administration of the Declaration shall have obtained written notice of such
Event of Default.
SECTION 2.08. Conflicting Interests. The Declaration shall be deemed
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to be specifically described in this Capital Securities Guarantee for the
purposes of clause (i) of the first proviso contained in Section 310(b) of the
Trust Indenture Act.
ARTICLE III
Powers, Duties and Rights of Capital Securities Guarantee Trustee
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SECTION 3.01. Powers and Duties of the Capital Securities Guarantee
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Trustee. (a) This Capital Securities Guarantee shall be held by the Capital
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Securities Guarantee Trustee for the benefit of the Holders of the Capital
Securities, and the Capital Securities Guarantee Trustee shall not transfer this
Capital Securities Guarantee to any Person except a Holder of Capital Securities
exercising his or her rights pursuant to Section 5.05(d) or to a Successor
Capital Securities Guarantee Trustee on acceptance by such Successor Capital
Securities Guarantee Trustee of its appointment to act as Successor Capital
Securities Guarantee Trustee. The right, title and interest of the Capital
Securities Guarantee Trustee shall automatically vest in any Successor Capital
Securities Guarantee Trustee, and such vesting and cessation of title shall be
effective whether or not conveyancing documents have been executed and delivered
pursuant to the appointment of such Successor Capital Securities Guarantee
Trustee.
(b) If an Event of Default has occurred and is continuing, the
Capital Securities Guarantee Trustee shall enforce this Capital Securities
Guarantee for the benefit of the Holders of the Capital Securities.
(c) The Capital Securities Guarantee Trustee, before the occurrence
of any Event of Default and after the curing of all Events of Default that may
have occurred, shall undertake to perform only such duties as are specifically
set forth in this Capital Securities Guarantee, and no implied covenants shall
be read into this Capital Securities Guarantee against the Capital Securities
Guarantee Trustee. In case an Event of Default has occurred (that has not been
cured or waived pursuant to Section 2.06), the Capital Securities Guarantee
Trustee shall exercise such of the rights and powers vested in it by this
Capital Securities Guarantee, and use the same degree of care and skill in its
exercise thereof, as a prudent person
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would exercise or use under the circumstances in the conduct of his or her own
affairs.
(d) No provision of this Capital Securities Guarantee shall be
construed to relieve the Capital Securities Guarantee Trustee from liability for
its own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Capital Securities
Guarantee Trustee shall be determined solely by the express provisions
of this Capital Securities Guarantee, and the Capital Securities
Guarantee Trustee shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this
Capital Securities Guarantee, and no implied covenants or obligations
shall be read into this Capital Securities Guarantee against the
Capital Securities Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Capital
Securities Guarantee Trustee, the Capital Securities Guarantee Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates
or opinions furnished to the Capital Securities Guarantee Trustee and
conforming to the requirements of this Capital Securities Guarantee;
but in the case of any such certificates or opinions that by any
provision hereof are specifically required to be furnished to the
Capital Securities Guarantee Trustee, the Capital Securities Guarantee
Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Capital Securities
Guarantee;
(ii) the Capital Securities Guarantee Trustee shall not be liable
for any error of judgment made in good faith by a Responsible Officer of
the Capital Securities Guarantee Trustee, unless it shall be proved that
the Capital Securities Guarantee Trustee was negligent in ascertaining the
pertinent facts upon which such judgment was made;
(iii) the Capital Securities Guarantee Trustee shall not be liable
with respect to any action taken or
8
omitted to be taken by it in good faith in accordance with the direction of
the Holders of not less than a Majority in liquidation amount of the
Capital Securities, relating to the time, method and place of conducting
any proceeding for any remedy available to the Capital Securities Guarantee
Trustee, or exercising any trust or power conferred upon the Capital
Securities Guarantee Trustee under this Capital Securities Guarantee; and
(iv) no provision of this Capital Securities Guarantee shall
require the Capital Securities Guarantee Trustee to expend or risk its own
funds or otherwise incur personal financial liability in the performance of
any of its duties or in the exercise of any of its rights or powers, if the
Capital Securities Guarantee Trustee shall have reasonable grounds for
believing that the repayment of such funds or liability is not reasonably
assured to it under the terms of this Capital Securities Guarantee or
adequate indemnity against such risk or liability is not reasonably assured
to it.
SECTION 3.02. Certain Rights of Capital Securities Guarantee Trustee.
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(a) Subject to the provisions of Section 3.01:
(i) the Capital Securities Guarantee Trustee may rely and shall be
fully protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to
have been signed, sent or presented by the proper party or parties;
(ii) any direction or act of the Guarantor contemplated by this
Capital Securities Guarantee shall be sufficiently evidenced by an
Officers' Certificate;
(iii) whenever, in the administration of this Capital Securities
Guarantee, the Capital Securities Guarantee Trustee shall deem it desirable
that a matter be proved or established before taking, suffering or omitting
any action hereunder, the Capital Securities Guarantee Trustee (unless
other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officers' Certificate
which, upon receipt of such request, shall be promptly delivered by the
Guarantor;
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(iv) the Capital Securities Guarantee Trustee shall have no duty to
see to any recording, filing or registration of any instrument (or any
rerecording, refiling or registration thereof);
(v) the Capital Securities Guarantee Trustee may consult with legal
counsel of its selection, and the written advice or opinion of such legal
counsel with respect to legal matters shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted to be taken by it hereunder in good faith and in accordance with
such advice or opinion. Such legal counsel may be legal counsel to the
Guarantor or any of its Affiliates and may include any of the Guarantor's
employees. The Capital Securities Guarantee Trustee shall have the right
at any time to seek instructions concerning the administration of this
Capital Securities Guarantee from any court of competent jurisdiction;
(vi) the Capital Securities Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
Capital Securities Guarantee at the request or direction of any Holder,
unless such Holder shall have provided to the Capital Securities Guarantee
Trustee such adequate security and indemnity as would satisfy a reasonable
person in the position of the Capital Securities Guarantee Trustee, against
the costs, expenses (including attorneys' fees and expenses) and
liabilities that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by the
Capital Securities Guarantee Trustee; provided that nothing contained in
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this Section 3.02(a)(vi) shall be taken to relieve the Capital Securities
Guarantee Trustee, upon the occurrence of an Event of Default, of its
obligation to exercise the rights and powers vested in it by this Capital
Securities Guarantee;
(vii) the Capital Securities Guarantee Trustee shall not be bound
to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond debenture, note, other evidence of
indebtedness or other paper or document, but the Capital Securities
Guarantee Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit;
(viii) the Capital Securities Guarantee Trustee may execute any of
the trusts or powers hereunder or
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perform any duties hereunder either directly or by or through agents or
attorneys, and the Capital Securities Guarantee Trustee shall not be
responsible for any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder;
(ix) any action taken by the Capital Securities Guarantee Trustee
or its agents hereunder shall bind the Holders of the Capital Securities,
and the signature of the Capital Securities Guarantee Trustee or its agents
alone shall be sufficient and effective to perform any such action; it
being understood that no third party shall be required to inquire as to the
authority of the Capital Securities Guarantee Trustee to so act or as to
its compliance with any of the terms and provisions of this Capital
Securities Guarantee, both of which shall be conclusively evidenced by the
Capital Securities Guarantee Trustee's or its agent's taking such action;
and
(x) whenever in the administration of this Capital Securities
Guarantee the Capital Securities Guarantee Trustee shall deem it desirable
to receive instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Capital Securities Guarantee Trustee
(i) may request written instructions from the Holders of the Capital
Securities or, other than with respect to enforcing any remedy or right or
taking any action related thereto, the Guarantor, (ii) may refrain from
enforcing such remedy or right or taking such other action until such
written instructions are received, and (iii) shall be protected in acting
in accordance with such written instructions.
(b) No provision of this Capital Securities Guarantee shall be deemed to
impose any duty or obligation on the Capital Securities Guarantee Trustee to
perform any act or acts or exercise any right, power, duty or obligation
conferred or imposed on it, in any jurisdiction in which it shall be illegal, or
in which the Capital Securities Guarantee Trustee shall be unqualified or
incompetent in accordance with applicable law, to perform any such act or acts
or to exercise any such right, power, duty or obligation. No permissive power
or authority available to the Capital Securities Guarantee Trustee shall be
construed to be a duty.
SECTION 3.03. Not Responsible for Recitals or Issuance of Guarantee.
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The recitals contained in this Capital Securities Guarantee shall be taken as
the statements of the Guarantor, and the Capital Securities Guarantee Trustee
does not assume any responsibility for their correctness. The Capital
Securities Guarantee Trustee
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makes no representations as to the validity or sufficiency of this Capital
Securities Guarantee.
ARTICLE IV
Capital Securities Guarantee Trustee
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SECTION 4.01. Capital Securities Guarantee Trustee; Eligibility. (a)
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There shall at all times be a Capital Securities Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws
of the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least 50 million
U.S. dollars (U.S.$50,000,000), and subject to supervision or examination
by Federal, State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of the supervising or examining authority
referred to above, then, for the purposes of this Section 4.01(a)(ii), the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published.
(b) If at any time the Capital Securities Guarantee Trustee shall
cease to be eligible to so act under Section 4.01(a), the Capital Securities
Guarantee Trustee shall immediately resign in the manner and with the effect set
out in Section 4.02(c).
(c) If the Capital Securities Guarantee Trustee has or shall acquire
any "conflicting interest" within the meaning of Section 3.10(b) of the Trust
Indenture Act, the Capital Securities Guarantee Trustee and Guarantor shall in
all respects comply with the provisions of Section 3.10(b) of the Trust
Indenture Act.
SECTION 4.02. Appointment, Removal and Resignation of Capital
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Securities Guarantee Trustee. (a) Subject to Section 4.02(b), the Capital
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Securities Guarantee Trustee may be appointed or removed without cause at any
time by the Guarantor, except that, if an Event of Default shall have occurred
and be continuing, the Capital
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Securities Guarantee Trustee may be removed only by the vote of Holders of a
majority in liquidation preference of the Capital Securities voting as a class
at a meeting of Holders of Capital Securities.
(b) The Capital Securities Guarantee Trustee shall not be removed in
accordance with Section 4.02(a) until a Successor Capital Securities Guarantee
Trustee has been appointed and has accepted such appointment by written
instrument executed by each Successor Capital Securities Guarantee Trustee and
delivered to the Guarantor.
(c) The Capital Securities Guarantee Trustee appointed to office shall
hold office until a Successor Capital Securities Guarantee Trustee shall have
been appointed or until its removal or resignation. The Capital Securities
Guarantee Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing executed by the Capital Securities
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Capital Securities Guarantee Trustee has been
appointed and has accepted such appointment by instrument in writing executed by
such Successor Capital Securities Guarantee Trustee and delivered to the
Guarantor and the resigning Capital Securities Guarantee Trustee.
(d) If no Successor Capital Securities Guarantee Trustee shall have
been appointed and accepted appointment as provided in this Section 4.02 within
60 days after delivery to the Guarantor of an instrument of removal or
resignation, the Capital Securities Guarantee Trustee resigning or being removed
may petition any court of competent jurisdiction for appointment of a Successor
Capital Securities Guarantee Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a Successor
Capital Securities Guarantee Trustee.
(e) No Capital Securities Guarantee Trustee shall be liable for the
acts or omissions to act of any Successor Capital Securities Guarantee Trustee.
(f) Upon termination of this Capital Securities Guarantee or
resignation of the Capital Securities Guarantee Trustee pursuant to this Section
4.02, the Guarantor shall pay to the Capital Securities Guarantee Trustee all
amounts accrued and owing to the Capital Securities Guarantee Trustee on the
date of such termination, removal or resignation.
(g) The Capital Securities Guarantee Trustee may engage in any merger,
conversion, consolidation or sale of all or substantially all of its corporate
trust business,
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provided that the Successor Capital Securities Guarantee Trustee shall be
otherwise qualified and eligible under this Capital Securities Guarantee
Agreement.
ARTICLE V
Guarantee
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SECTION 5.01. Guarantee. The Guarantor irrevocably and
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unconditionally agrees to pay in full to the Holders the Guarantee Payments
(without duplication of amounts theretofore paid by or on behalf of the Issuer),
as and when due, regardless of any defense, right of set-off or counterclaim
that the Issuer may have or assert. The Guarantor's obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the Guarantor to the Holders or by causing the Issuer to pay such amounts to the
Holders.
SECTION 5.02. Subordination. If an Event of Default (as defined in
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the Indenture), has occurred and is continuing, the rights of Holders of the
Common Securities to receive payments as provided in the Declaration are
subordinated to the rights of Holders of Capital Securities to receive Guarantee
Payments under this Capital Securities Guarantee.
SECTION 5.03. Waiver of Notice and Demand. The Guarantor hereby
---------------------------
waives notice of acceptance of this Capital Securities Guarantee and of any
liability to which it applies or may apply, presentment, demand for payment, any
right to require a proceeding first against the Issuer or any other Person
before proceeding against the Guarantor, protest, notice of nonpayment, notice
of dishonor, notice of redemption and all other notices and demands.
SECTION 5.04. Obligations Not Affected. The obligations, covenants,
------------------------
agreements and duties of the Guarantor under this Capital Securities Guarantee
shall in no way be affected or impaired by reason of the happening from time to
time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Capital Securities to be performed
or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions, the amount payable upon redemption, the
Liquidation Distribution or any other sums payable under the terms of the
Capital Securities or the extension of time for the performance of
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any other obligation under, arising out of, or in connection with, the Capital
Securities (other than an extension of time for payment of Distributions, the
amount payable upon redemption, Liquidation Distribution or other sum payable
that results from the extension of any interest payment period on the
Debentures;
(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Capital Securities, or any
action on the part of the Issuer granting indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;
(e) any invalidity of, or defect or deficiency in the Capital
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.04 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders or any other Person to
give notice to, or obtain consent of, the Guarantor with respect to the
happening of any of the foregoing.
SECTION 5.05. Rights of Holders. The Guarantor expressly
-----------------
acknowledges that:
(a) This Capital Securities Guarantee will be deposited with the
Capital Securities Guarantee Trustee to be held for the benefit of the Holders.
(b) The Capital Securities Guarantee Trustee has the right to enforce
this Capital Securities Guarantee on behalf of the Holders.
(c) The Holders of a Majority in liquidation amount of the Capital
Securities have the right to direct the time, method and place of conducting any
proceeding for
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any remedy available to the Capital Securities Guarantee Trustee in respect of
this Capital Securities Guarantee or exercising any trust or power conferred
upon the Capital Securities Guarantee Trustee under this Capital Securities
Guarantee.
(d) Any Holder of Capital Securities may institute a legal proceeding
directly against the Guarantor to enforce its rights under this Capital
Securities Guarantee, without first instituting a legal proceeding against the
Issuer, the Capital Securities Guarantee Trustee or any other Person.
SECTION 5.06. Guarantee of Payment. This Capital Securities
--------------------
Guarantee creates a guarantee of payment and not of collection. The Capital
Securities Guarantee will not be discharged except by payment of the Guarantee
Payments in full (without duplication of amounts theretofore paid by the Issuer)
or upon distribution of Debentures to Holders as provided in the Declaration.
SECTION 5.07. Subrogation. The Guarantor shall be subrogated to all
-----------
(if any) rights of the Holders of Capital Securities against the Issuer in
respect of any amounts paid to such Holders by the Guarantor under this Capital
Securities Guarantee; provided, however, that the Guarantor shall not (except to
-------- -------
the extent required by mandatory provisions of law) be entitled to enforce or
exercise any right that it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under this
Capital Securities Guarantee, if, at the time of any such payment, any amounts
are due and unpaid under this Capital Securities Guarantee. If any amount shall
be paid to the Guarantor in violation of the preceding sentence, the Guarantor
agrees to hold such amount in trust for the Holders and to pay over such amount
to the Holders.
SECTION 5.08. Independent Obligations. The Guarantor acknowledges
-----------------------
that its obligations hereunder are independent of the obligations of the Issuer
with respect to the Capital Securities, and that the Guarantor shall be liable
as principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Capital Securities Guarantee notwithstanding the occurrence of any
event referred to in subsections (a) through (g), inclusive, of Section 5.04
hereof.
ARTICLE VI
Limitation of Transactions; Subordination
-----------------------------------------
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SECTION 6.01. Limitations of Transactions. So long as any Capital
---------------------------
Securities remain outstanding, if there shall have occurred an Event of Default,
an event that, with the giving of notice or the lapse of time or both, would
constitute an Event of Default under the Indenture or a selection by the
Guarantor of an Extended Interest Payment Period as provided in the Indenture
and such period, or any extension thereof, shall be continuing, then (a) the
Guarantor shall not declare or pay any dividend on, or make any distribution
with respect to, or redeem, purchase, acquire or make a liquidation payment with
respect to, any of its capital stock (other than stock dividends paid by the
Guarantor which stock dividends consist of the stock of the same class as that
on which the dividend is being paid), (b) the Guarantor shall not make any
payment of interest, principal or premium, if any, on or repay, repurchase or
redeem any debt securities issued by the Guarantor which rank pari passu with or
junior to the Debentures and (c) shall not make any guarantee payments with
respect to the foregoing (other than pursuant to this Capital Securities
Guarantee).
SECTION 6.02. Ranking. This Capital Securities Guarantee will
-------
constitute an unsecured obligation of the Guarantor and will rank (i)
subordinate and junior in right of payment to all other liabilities of the
Guarantor, except any liabilities that may be made pari passu or junior
---- -----
expressly by their terms, (ii) pari passu with the most senior preferred or
---- -----
preference stock now or hereafter issued by the Guarantor and with any guarantee
now or hereafter entered into by the Guarantor in respect of any preferred or
preference stock or preferred security of any Affiliate of the Guarantor, and
(iii) senior to the Guarantor's common stock.
ARTICLE VII
Termination
-----------
SECTION 7.01. Termination. This Capital Securities Guarantee shall
-----------
terminate upon (i) full payment of the amount payable upon redemption of all
Capital Securities, (ii) the distribution of the Debentures to the Holders of
all of the Capital Securities or (iii) full payment of the amounts payable in
accordance with the Declaration upon liquidation of the Issuer. Notwithstanding
the foregoing, this Capital Securities Guarantee will continue to be effective
or will be reinstated, as the case may be, if at any time any Holder of Capital
Securities must restore payment of any sums paid under the Capital Securities or
under this Capital Securities Guarantee.
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ARTICLE VIII
Indemnification
---------------
SECTION 8.01. Exculpation. (a) No Indemnified Person shall be
-----------
liable, responsible, or accountable in damages or otherwise to the Guarantor or
any Covered Person for any loss, damage or claim incurred by reason of any act
or omission performed or omitted by such Indemnified Person in good faith in
accordance with this Capital Securities Guarantee and in a manner that such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Capital Securities Guarantee or by
law, except that an Indemnified Person shall be liable for any such loss, damage
or claim incurred by reason of such Indemnified Person's negligence or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Capital Securities might properly be paid.
SECTION 8.02. Indemnification. (a) The Guarantor agrees to
---------------
indemnify each Indemnified Person for, and to hold each Indemnified Person
harmless against, any and all loss, liability or expense including taxes (other
than taxes based on the income of such Indemnified Person) incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of defending
itself against or investigating any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The
obligation to indemnify as set forth in this Section 8.02 shall survive the
termination of this Capital Securities Guarantee.
(b) To the fullest extent permitted by applicable law, expenses
(including legal fees and expenses) incurred by an Indemnified Person in
defending any claim, demand, action, suit or proceeding shall, from time to
time, be
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advanced by the Guarantor prior to the final disposition of such claim, demand,
action, suit or proceeding upon receipt by the Guarantor of an undertaking by or
on behalf of the Indemnified Person to repay such amount if it shall be
determined that the Indemnified Person is not entitled to be indemnified as
authorized in Section 8.02(a).
(c) No Indemnified Person shall claim or exact any lien or charge on
any Guarantee Payments as a result of any amount due to it under this Capital
Securities Guarantee.
ARTICLE IX
Miscellaneous
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SECTION 9.01. Successors and Assigns. All guarantees and agreements
----------------------
contained in this Capital Securities Guarantee shall bind the successors,
assigns, receivers, trustees and representatives of the Guarantor and shall
inure to the benefit of the Holders of the Capital Securities then outstanding.
Except in connection with any permitted merger or consolidation of the Guarantor
with or into another entity or any permitted sale, transfer or lease of the
Guarantor's assets to another entity, the Guarantor may not assign its rights or
delegate its obligations under the Capital Securities Guarantee without the
prior approval of the Holders of at least 66 2/3% of the aggregate liquidation
amount of the Capital Securities then outstanding.
SECTION 9.02. Amendments. Except with respect to any changes that do
----------
not adversely affect the rights of Holders (in which case no consent of Holders
will be required), this Capital Securities Guarantee may only be amended with
the prior approval of the Holders of at least 66 2/3% in liquidation amount of a
the outstanding Capital Securities. The provisions of Section 12.02 of the
Declaration with respect to meetings of Holders of the Capital Securities apply
to the giving of such approval.
SECTION 9.03. Notices. All notices provided for in this Capital
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Securities Guarantee shall be in writing, duly signed by the party giving such
notice, and shall be delivered, telecopied or mailed by first-class mail, as
follows:
(a) If given to the Capital Securities Guarantee Trustee, at the
Capital Securities Guarantee Trustee's mailing address set forth below (or such
other address as the Capital Securities Guarantee Trustee may give notice of to
the Holders of the Capital Securities):
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Wilmington Trust Company
▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
Attn: Corporate Trust
Trustee Administration
(b) If given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders of the Capital Securities):
Nationwide Financial Services, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
(c) If given to any Holder of Capital Securities, at the address set
forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 9.04. Benefit. This Capital Securities Guarantee is solely
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for the benefit of the Holders of the Capital Securities and, subject to Section
3.01(a), is not separately transferable from the Capital Securities.
SECTION 9.05. Governing Law. THIS CAPITAL SECURITIES GUARANTEE SHALL
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BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
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THIS CAPITAL SECURITIES GUARANTEE is executed as of the day and year
first above written.
NATIONWIDE FINANCIAL SERVICES, INC.,
as Guarantor,
By
-------------------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as Capital Securities
Guarantee Trustee,
By
-------------------------------------------
Name:
Title:
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