EXHIBIT 4.20
FORM OF AMENDED AND RESTATED TRUST AGREEMENT
AMENDED AND RESTATED TRUST AGREEMENT
By and Among
THE ▇▇▇▇ DISNEY COMPANY,
as Sponsor,
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
as Property Trustee,
WILMINGTON TRUST COMPANY,
as Delaware Trustee,
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
Dated as of ________ __, 200_
CROSS REFERENCE TABLE*
---------------------
Section of Section of
Trust Indenture Act of 1939, as amended Trust Agreement
--------------------------------------- ---------------
310(a).............................. 6.3
310(b).............................. 6.3
310(c).............................. Inapplicable
311(a).............................. 2.2(b)
311(b).............................. 2.2(b)
311(c).............................. Inapplicable
312(a).............................. 2.2(a)
312(b).............................. 2.2(b); 13.2
312(c).............................. 13.2
313(a).............................. 2.3
313(b).............................. 2.3
313(c).............................. 2.3
313(d).............................. 2.3
314(a).............................. 2.4; 3.6(k); 13.4
314(b).............................. Inapplicable
314(c).............................. 2.5
314(d).............................. Inapplicable
314(e).............................. 2.5; 13.4
314(f).............................. Inapplicable
315(a).............................. 3.9(b); 3.10(a)
315(b).............................. 2.7
315(c).............................. 3.9
315(d).............................. 3.9
315(e).............................. Inapplicable
316(a).............................. 2.6(a), (b) and (c)
316(b).............................. Inapplicable
316(c).............................. 3.6(f)
317(a).............................. 3.16; 3.8(e)
317(b).............................. 3.8(h)
318(a).............................. 2.1(c)
--------------------------------
* This cross-reference table does not constitute part of the agreement and
shall not have any bearing upon the interpretation of any of its terms or
provisions.
TABLE OF CONTENTS
Page
----
ARTICLE 1 INTERPRETATION AND DEFINITIONS.................................................................1
Section 1.1. Definitions.....................................................................1
Section 1.2. Other Definitions...............................................................8
Section 1.3. Incorporation by Reference of Trust Indenture Act...............................8
Section 1.4. Rules of Construction...........................................................9
ARTICLE 2 TRUST INDENTURE ACT............................................................................9
Section 2.1. Trust Indenture Act; Application................................................9
Section 2.2. Lists of Holders of Securities..................................................9
Section 2.3. Reports by the Property Trustee................................................10
Section 2.4. Periodic Reports to the Property Trustee.......................................10
Section 2.5. Evidence of Compliance with Conditions Precedent...............................10
Section 2.6. Trust Enforcement Events; Waiver...............................................10
Section 2.7. Notice of Trust Enforcement Event by Property Trustee..........................12
ARTICLE 3 ORGANIZATION..................................................................................12
Section 3.1. Name and Organization..........................................................12
Section 3.2. Office.........................................................................12
Section 3.3. Purpose........................................................................12
Section 3.4. Authority......................................................................13
Section 3.5. Title to Property of the Trust.................................................13
Section 3.6. Powers and Duties of the Administrative Trustees...............................14
Section 3.7. Prohibition of Actions by the Trust and the Trustees...........................16
Section 3.8. Powers and Duties of the Property Trustee......................................17
Section 3.9. Duties and Responsibilities of the Property Trustee............................19
Section 3.10. Rights of Property Trustee.....................................................21
Section 3.11. Delaware Trustee...............................................................22
Section 3.12. Execution of Documents.........................................................22
Section 3.13. Trustees' Disclaimer...........................................................23
Section 3.14. Duration of Trust..............................................................23
Section 3.15. Mergers........................................................................23
Section 3.16. Property Trustee May File Proofs of Claim......................................25
ARTICLE 4 SPONSOR.......................................................................................25
Section 4.1. Responsibilities of the Sponsor................................................25
Section 4.2. Compensation and Indemnification...............................................26
ARTICLE 5 TRUST COMMON SECURITIES HOLDER................................................................26
Section 5.1. Debenture Issuer's Purchase of Common Securities...............................26
Section 5.2. Covenants of the Common Securities Holder......................................26
i
ARTICLE 6 TRUSTEES......................................................................................27
Section 6.1. Number of Trustees.............................................................27
Section 6.2. Delaware Trustee; Eligibility..................................................27
Section 6.3. Property Trustee; Eligibility; Disqualification................................27
Section 6.4. Qualifications of Administrative Trustees and Delaware
Trustee Generally..............................................................28
Section 6.5. Initial Administrative Trustees................................................28
Section 6.6. Replacement of Trustees........................................................28
Section 6.7. Vacancies among Trustees.......................................................29
Section 6.8. Effect of Vacancies............................................................30
Section 6.9. Meetings.......................................................................30
Section 6.10. Delegation of Power............................................................30
Section 6.11. Successor Trustee by Merger, etc...............................................31
ARTICLE 7 TERMS OF SECURITIES...........................................................................31
Section 7.1. General Provisions Regarding Securities........................................31
Section 7.2. Distributions..................................................................34
Section 7.3. Redemption of Securities.......................................................35
Section 7.4. Redemption Procedures..........................................................36
Section 7.5. Voting Rights of Preferred Securities..........................................37
Section 7.6. Voting Rights of Common Securities.............................................39
Section 7.7. Registrar and Paying Agent.....................................................41
Section 7.8. Listing........................................................................41
Section 7.9. Transfer and Exchange of Securities............................................41
Section 7.10. Mutilated, Destroyed, Lost and Stolen Securities...............................42
Section 7.11. Outstanding Securities.........................................................43
Section 7.12. Treasury Securities............................................................43
Section 7.13. Temporary Securities...........................................................43
Section 7.14. Cancellation...................................................................44
Section 7.15. Deemed Security Holders........................................................44
Section 7.16. Global Securities..............................................................44
Section 7.16.1 Terms of Securities............................................................44
Section 7.16.2 Transfer and Exchange..........................................................44
Section 7.16.3 Legend.........................................................................45
Section 7.16.4 Cancellation; Issuance of Registered Securities................................45
Section 7.16.5 Acts of Holders................................................................46
Section 7.16.6 Payments.......................................................................46
Section 7.16.7 Consents, Declaration and Directions...........................................46
Section 7.17. CUSIP Numbers..................................................................46
Section 7.18. Over-Allotment Option..........................................................46
ARTICLE 8 DISSOLUTION AND TERMINATION OF TRUST..........................................................47
Section 8.1. Dissolution and Termination of Trust...........................................47
Section 8.2. Liquidation Distribution Upon Dissolution of the Trust.........................48
ii
ARTICLE 9 LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES,
DELAWARE TRUSTEES OR OTHERS...................................................................49
Section 9.1. Liability......................................................................49
Section 9.2. Exculpation....................................................................49
Section 9.3. Fiduciary Duty.................................................................50
Section 9.4. Indemnification................................................................51
Section 9.5. Outside Businesses.............................................................54
ARTICLE 10 ACCOUNTING...................................................................................54
Section 10.1. Fiscal Year....................................................................54
Section 10.2. Certain Accounting Matters.....................................................54
Section 10.3. Banking........................................................................55
Section 10.4. Withholding....................................................................55
ARTICLE 11 AMENDMENTS AND MEETINGS......................................................................55
Section 11.1. Amendments.....................................................................55
Section 11.2. Meetings of the Holders of Securities; Action by Written
Consent........................................................................58
ARTICLE 12 REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE.....................................60
Section 12.1. Representations and Warranties of the Property Trustee.........................60
Section 12.2. Representations and Warranties of the Delaware Trustee.........................60
ARTICLE 13 MISCELLANEOUS................................................................................61
Section 13.1. Notices........................................................................61
Section 13.2. Communication by Holders with Other Holders....................................62
Section 13.3. Certificate and Opinion as to Conditions Precedent.............................62
Section 13.4. Statements Required in Certificate or Opinion..................................63
Section 13.5. Rules by Trustee and Agents....................................................63
Section 13.6. Legal Holidays.................................................................63
Section 13.7. No Recourse Against Others.....................................................63
Section 13.8. Intention of the Parties.......................................................63
Section 13.9. Counterparts...................................................................63
Section 13.10. Governing Laws.................................................................64
Section 13.11. Successors.....................................................................64
Section 13.12. Severability...................................................................64
Section 13.13. Table of Contents, Headings, Etc...............................................64
Exhibits
--------
Exhibit A Form of Preferred Security Certificate
Exhibit B Form of Common Security Certificate
iii
AMENDED AND RESTATED
TRUST AGREEMENT
This AMENDED AND RESTATED
TRUST AGREEMENT (the "
Trust
Agreement"), dated as of ________ __, 200_, is entered into by and among (i) The
▇▇▇▇ Disney Company, a
Delaware corporation, as sponsor (the "Sponsor"), (ii)(a)
▇▇▇▇▇ Fargo Bank, National Association, a national banking association organized
under the laws of the United States, as initial Property Trustee, (b) Wilmington
Trust Company, a banking corporation organized under the laws of
Delaware, as
initial
Delaware Trustee, and (c) ________, an individual, ________, an
individual and ________, an individual, each of whose address is ________ (each
an "Administrative Trustee" and, collectively, the "Administrative Trustees"
and, together with the Property Trustee and the Delaware Trustee, the
"Trustees," all not in their individual capacities, but solely as Trustees) and
(iii) the several Holders as hereinafter defined.
RECITALS
WHEREAS, the Delaware Trustee and the Sponsor established
Disney Capital Trust [I / II / III] (the "Trust"), a business trust under the
Business Trust Act (as defined, together with other capitalized terms, herein)
pursuant to a
Trust Agreement dated as of August 16, 2001 (the "Original
Trust
Agreement") and a Certificate of Trust (the "Certificate of Trust") filed with
the Secretary of State of the State of Delaware on August 16, 2001;
WHEREAS, the sole purpose of the Trust shall be to issue and
sell certain securities representing undivided beneficial ownership interests in
the assets of the Trust, to invest the proceeds from such sales in the
Debentures issued by the Debenture Issuer, to make Distributions as herein
provided and to engage in only those activities necessary, advisable or
incidental thereto; and
WHEREAS, the parties hereto, by this
Trust Agreement, amend
and restate each and every term and provision of the Original
Trust Agreement;
NOW, THEREFORE, it being the intention of the parties hereto
to continue the Trust as a business trust under the Business Trust Act and that
this Trust Agreement constitute the governing instrument of such business trust,
the Trustees hereby declare that all assets contributed to the Trust be held in
trust for the benefit of the Holders, from time to time, of the Securities
representing undivided beneficial ownership interests in the assets of the Trust
issued hereunder, subject to the provisions of this Trust Agreement.
ARTICLE 1
INTERPRETATION AND DEFINITIONS
Section 1.1. DEFINITIONS. The following terms have the
following meanings:
"Administrative Trustee" means any Trustee other than the
Property Trustee and the Delaware Trustee.
"Affiliate" of any specified person means any other person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled," "controlled by" and "under common control with") as used with
respect to any person shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such
person, directly or indirectly, whether through the ownership of voting
securities or by agreement or otherwise.
"Agreement as to Expenses and Liabilities" means the Agreement
as to Expenses and Liabilities between the Sponsor and Disney Capital Trust [I /
II / III] dated as of ________ __, 200_.
"Authorized Officer" of a Person means any Person that is
authorized to bind such Person.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having
jurisdiction in the premises judging such person a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization, arrangement,
adjudication or composition of or in respect of such person under any applicable
Federal or State bankruptcy, insolvency, reorganization or other similar law, or
appointing a receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of such person or of any substantial part of its property or
ordering the winding up or liquidation of its affairs, and the continuance of
any such decree or order unstayed and in effect for a period of 60 consecutive
days; or
(b) the institution by such person of proceedings to be
adjudicated bankrupt or insolvent, or the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it of a
petition or answer or consent seeking reorganization or relief under any
applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law, or the consent by it to the filing of any such petition or to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of such person or of any substantial part of its property, or
the making by it of an assignment for the benefit of creditors, or the admission
by it in writing of its inability to pay its debts generally as they become due
and its willingness to be adjudicated a bankrupt, or the taking of corporate
action by such person in furtherance of any such action.
"Beneficial Owners" means, for Preferred Securities
represented by a Global Security, the person who acquires an interest in the
Preferred Securities which is reflected on the records of the Depositary through
the Depositary Participants.
2
"Board of Directors" means the Board of Directors of the
Sponsor or any committee of such board authorized with respect to any matter to
exercise the power of the Board of Directors of the Sponsor.
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Sponsor to have been duly adopted
by the Board of Directors or pursuant to authorization by the Board of Directors
and to be in full force and effect on the date of such certification and
delivered to the corresponding Trustee.
"Business Day" means, except as otherwise provided by Board
Resolution or Officers' Certificate, any day except a Saturday, Sunday or legal
holiday in The City of New York, New York on which banking institutions are
authorized or required by law, regulation or executive order to close.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from time
to time, or any successor legislation.
"Certificate" means a Common Security Certificate or a
Preferred Security Certificate.
"Closing Date" means the date on which the Preferred
Securities are issued and sold; PROVIDED that if the Trust and the Sponsor grant
the underwriters or initial purchasers an option to purchase an additional
amount of Preferred Securities, pursuant to Section 7.18(a), including for the
purpose of covering over-allotments, pursuant to the underwriting agreement or
purchase agreement, as the case may be, and such option is so exercised, then
the term "Closing Date" shall mean such initial or second closing date, as the
context requires.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation. A reference to a specific
section of the Code refers not only to such specific section but also to any
corresponding provision of any federal tax statute enacted after the date of
this Trust Agreement, as such specific section or corresponding provision is in
effect on the date of application of the provisions of this Trust Agreement
containing such reference.
"Commission" means the Securities and Exchange Commission or
any successor thereto.
"Common Security Certificate" means a definitive certificate
in fully registered form representing a Common Security, substantially in the
form of Exhibit B hereto.
"Common Securities Holder" means The ▇▇▇▇ Disney Company, in
its capacity as purchaser and holder of all of the Common Securities issued by
the Trust, or any permitted successor holder of the Common Securities.
3
"Corporate Trust Office" means the office of the Property
Trustee at which at any particular time its corporate trust business shall be
principally administered, which office at the date of execution of this Trust
Agreement is located at ▇▇▇▇▇ Fargo Bank, National Association, ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
"Covered Person" means (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates; and (b) any Holder.
"Debentures" means the series of junior subordinated debt
securities to be issued by the Debenture Issuer designated the "__% Junior
Subordinated Debt Securities due ________" and to be purchased by the Trust and
held by the Property Trustee.
"Debenture Issuer" shall mean The ▇▇▇▇ Disney Company, a
Delaware corporation, in its capacity as issuer of the Debentures under the
Indenture.
"Delaware Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 6.2.
"Depositary" means, with respect to Securities issuable in
whole or in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as Depositary for
such Securities.
"Depositary Participant" means a member of, or participant in,
the Depositary.
"Distribution" means a distribution payable to Holders of
Securities in accordance with Section 7.2.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor legislation.
"Global Security" means a fully registered, global Preferred
Security Certificate.
"Guarantee" means the Guarantee Agreement, dated as of
________ __, 200_, of the Sponsor in respect of the Preferred Securities.
"Holder" means a person in whose name a Security is
registered; PROVIDED, HOWEVER, that in determining whether the Holders of the
requisite liquidation amount of Preferred Securities have voted on any matter
provided for in this Trust Agreement, then for the purpose of such determination
only (and not for any other purpose hereunder), if the Preferred Securities
remain in the form of one or more Global Securities and if the Depositary which
is the holder of such Global Securities has sent an omnibus proxy to the Trust
assigning voting rights to Depositary Participants to whose accounts the
Preferred Securities are credited on the record date, the term "Holders" shall
mean such Depositary Participants acting at the direction of the Beneficial
Owners.
4
"Indemnified Person" means a Sponsor Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Subordinated Debt Securities Indenture,
dated as of ________ __, 200_ between the Debenture Issuer and the Indenture
Trustee, pursuant to which the Debentures are to be issued and as thereafter
amended.
"Indenture Event of Default" has the meaning given to the term
"Event of Default" in the Indenture.
"Indenture Trustee" means ▇▇▇▇▇ Fargo Bank, National
Association, in its capacity as trustee under the Indenture until a successor is
appointed thereunder, and thereafter means such successor trustee.
"Investment Company" means an investment company as defined in
the 1940 Act and the regulations promulgated thereunder.
"Investment Company Event" means the receipt by the Trust of
an opinion of a nationally recognized independent counsel (an "1940 Act
Opinion"), to the effect that, as a result of the occurrence of a change in law
or regulation or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law"), the Trust is or will be considered an
"investment company" that is required to be registered under the 1940 Act, which
Change in 1940 Act Law becomes effective on or after the Closing Date.
"Majority In Liquidation Amount" means, except as provided in
the terms of the Preferred Securities or by the TIA, Holder(s) of outstanding
Securities, voting together as a single class, or, as the context may require,
Holders of outstanding Preferred 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 accumulated and unpaid
Distributions to the date upon which the voting percentages are determined) of
all outstanding Securities of the relevant class.
"New York Stock Exchange" means the New York Stock Exchange,
Inc. or any successor thereto.
"1940 Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"Officer" means the Chairman of the Board, any Vice Chairman,
the Chief Executive Officer, the President, any Vice President, the Treasurer,
the Secretary, any Assistant Treasurer or any Assistant Secretary of the
Sponsor.
"Officers' Certificate" means a written certificate containing
the information specified in Sections 13.3 and 13.4 hereof signed in the name of
the Company by its Chairman of the Board, a Vice Chairman, its Chief Executive
Officer, its
5
President or a Vice President, and by its Treasurer, an Assistant Treasurer,
its Secretary or an Assistant Secretary, and delivered to the applicable
Trustee; PROVIDED, that the term "Officers' Certificate" when used with
reference to Administrative Trustees who are natural persons shall mean a
certificate signed by two or more of the Administrative Trustees which
otherwise satisfies the foregoing requirements.
"Opinion of Counsel" means a written legal opinion containing
the information specified in Sections 13.3 and 13.4 hereof. The counsel may be
an employee of, or counsel to, the Sponsor.
"Person" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated organization, or government or any agency or
political subdivision thereof.
"Preferred Security Certificate" means a definitive
certificate in fully registered form representing a Preferred Security,
substantially in the form of Exhibit A.
"Property Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 6.3.
"Pro Rata" means pro rata to each Holder of Securities
according to the aggregate liquidation amount of the Securities held by the
relevant Holder in relation to the aggregate liquidation amount of all
Securities outstanding.
"Quorum" means a majority of the Administrative Trustees or,
if there are only two Administrative Trustees, both of them.
"Redemption Price" means the amount for which the Securities
will be redeemed, which amount will equal (i) the redemption price paid by the
Debenture Issuer to repay or redeem, in whole or in part, the Debentures held by
the Trust plus an amount equal to accumulated and unpaid Distributions on such
Securities through the date of their redemption or (ii) such lesser amount as
will be received by the Trust in respect of the Debentures so repaid or
redeemed.
"Responsible Officer" means, with respect to the Property
Trustee, any officer with direct responsibility for the administration of this
Trust Agreement and also means, with respect to a particular corporate trust
matter, any other officer to whom any corporate trust matter is referred because
of that officer's knowledge of and familiarity with a particular subject.
"Securities" means the Common Securities and the Preferred
Securities.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, or any successor legislation.
"Special Event" means a Tax Event or an Investment Company
Event.
6
"Sponsor" means The ▇▇▇▇ Disney Company, a Delaware
corporation, or any successor entity in a transaction involving the Sponsor that
is permitted by Article V of the Indenture and pursuant to which the successor
agrees in writing to perform the Sponsor's obligations hereunder.
"Sponsor Indemnified Person" means (i) any Administrative
Trustee or any officers, directors, employees, shareholders or agents of any
Administrative Trustee or (ii) any officer, employee or agent of the Trust.
"Tax Event" means the receipt by the Trust of an opinion of
independent tax counsel experienced in such matters ("Tax Event Opinion"), to
the effect that, as a result of (a) any amendment to, change in or 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
(b) any official administrative written decision or pronouncement, or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or which pronouncement, or decision is announced on or after
the Closing Date, 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 the 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, in
whole or in part, by the Debenture Issuer 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.
"10% In Liquidation Amount" means, except as provided in the
terms of the Preferred Securities or by the TIA, Holder(s) of outstanding
Securities, voting together as a single class, or, as the context may require,
Holders of outstanding Preferred 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 accumulated and unpaid
Distributions to the date upon which the voting percentages are determined) of
all outstanding Securities of the relevant class.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
Sections 77aaa-77bbbb), as amended from time to time, and as in effect on the
date of this Trust Agreement; PROVIDED, HOWEVER, that in the event the TIA is
amended after such date, TIA means, to the extent required by any such
amendment, the TIA as so amended.
"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).
"Trust Enforcement Event" in respect of the Securities means
an Indenture Event of Default has occurred and is continuing in respect of the
Debentures.
7
"Trustee" or "Trustees" means each person who has signed this
Trust Agreement as a trustee, so long as such person shall continue as a trustee
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.
Section 1.2. OTHER DEFINITIONS.
Term Defined in Section
---- ------------------
"Certificate of Trust" Recitals
"Common Securities" 7.1(a)(ii)
"Compound Distributions" 7.2(b)
"Delaware Trustee" 6.2
"Direct Action" 3.8(e)
"Extension Period" 7.2(b)
"Fiduciary Indemnified Person" 9.4(b)
"Fiscal Year" 10.1
"Legal Action" 3.6(g)
"Legal Holiday" 13.6
"Liquidation" 8.2(a)
"Liquidation Distribution" 8.2(a)
"List of Holders" 2.2(a)
"Option" 7.18(a)
"Original Trust Agreement" Recitals
"Paying Agent" 3.8(h)
"Payment Amount" 7.2(c)
"Preferred Securities" 7.1(a)(i)
"Property Account" 3.8(c)
"Registrar" 7.7
"Service Agent" 7.7
"Successor Entity" 3.15(b)(i)
"Successor Securities" 3.15(b)(i)b
"Super Majority" 2.6(a)(ii)
"Trust" Recitals
"Trust Agreement" Preamble
"Trust Order" 7.1(c)
Section 1.3. INCORPORATION BY REFERENCE OF TRUST INDENTURE
ACT. Whenever this Trust Agreement refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Trust
Agreement. All terms used in this Trust Agreement that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule under
the TIA and not otherwise defined herein are used herein as so defined.
8
Section 1.4. RULES OF CONSTRUCTION. Unless the context
otherwise requires:
(a) a term has the meaning assigned to it;
(b) "or" is not exclusive;
(c) words in the singular include the plural, and in the
plural include the singular; and
(d) provisions apply to successive events and
transactions.
ARTICLE 2
TRUST INDENTURE ACT
Section 2.1. TRUST INDENTURE ACT; APPLICATION.
(a) This Trust Agreement is subject to the provisions of
the TIA that are required to be part of this Trust Agreement and shall, to the
extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which
is a Trustee for the purposes of the TIA.
(c) If and to the extent that any provision of this Trust
Agreement conflicts with the duties imposed by Sections 310 to 317, inclusive,
of the TIA, such imposed duties shall control.
(d) The application of the TIA to this Trust Agreement
shall not affect the Trust's classification as a grantor trust for United States
federal income tax purposes and shall not affect the nature of the Securities as
equity securities representing undivided beneficial ownership interests in the
assets of the Trust.
Section 2.2. LISTS OF HOLDERS OF SECURITIES.
(a) Each of the Sponsor and the Administrative Trustees
on behalf of the Trust shall provide the Property Trustee at any time when the
Property Trustee is not also acting as Registrar for the Securities at least 10
days before each Distribution payment date and at such other times as the
Property Trustee may request in writing a list, in such form and as of such date
as the Property Trustee may reasonably require, of the names and addresses of
the Holders of the Securities ("List of Holders"); PROVIDED that neither the
Sponsor nor the Administrative Trustees on behalf of the Trust shall 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 Property Trustee by
the Sponsor and the Administrative Trustees on behalf of the Trust. The Property
Trustee shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it or which it receives in
the capacity as Paying Agent (if acting in such
9
capacity); PROVIDED that the Property Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its
obligations under, and shall be entitled to the benefits of, Sections 311(a),
311(b) and 312(b) of the TIA.
Section 2.3. REPORTS BY THE PROPERTY TRUSTEE. Within 60 days
after May 15 of each year (commencing with the year in which the first
anniversary of the issuance of the Preferred Securities occurs), the Property
Trustee shall provide to the Holders of the Preferred Securities such reports as
are required by Section 313(a) of the TIA, if any, in the form and in the manner
provided by Section 313 of the TIA. The Property Trustee shall also comply with
the other requirements of Section 313 of the TIA. The Sponsor shall promptly
notify the Property Trustee when the Preferred Securities are listed on any
stock exchange.
Section 2.4. PERIODIC REPORTS TO THE PROPERTY TRUSTEE. Each of
the Sponsor and the Administrative Trustees on behalf of the Trust shall provide
to the Property Trustee such documents, reports and information as required by
Section 314 of the TIA (if any) and the compliance certificate required by
Section 314(a)(4) of the TIA in the form, in the manner and at the times
required by Section 314 of the TIA; PROVIDED that such compliance certificate
shall be delivered on or before 120 days after the end of each fiscal year of
the Sponsor.
Section 2.5. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
Each of the Sponsor and the Administrative Trustees on behalf of the Trust shall
provide to the Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Trust Agreement that relate to any of
the matters set forth in Section 314(c) of the TIA. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given in
the form of an Officers' Certificate.
Section 2.6. TRUST ENFORCEMENT EVENTS; WAIVER.
(a) The Holders of a Majority in Liquidation Amount of
the Preferred Securities may, by vote or written consent, on behalf of the
Holders of all of the Preferred Securities, waive any past Trust Enforcement
Event in respect of the Preferred Securities and its consequences; PROVIDED
that, if the underlying Indenture Event of Default:
(i) is not waivable under the Indenture, the
Trust Enforcement Event under the Trust Agreement shall also not be
waivable; or
(ii) requires the consent or vote of the Holders
of greater than a majority in principal amount of the Debentures (a
"Super Majority") to be waived under the Indenture, the related Trust
Enforcement Event under the Trust Agreement may only be waived by the
vote or written consent of the Holders of at least the proportion in
aggregate liquidation amount of the Preferred Securities that the
relevant Super Majority represents of the aggregate principal amount of
the Debentures outstanding.
10
The foregoing provisions of this Section 2.6(a) shall be in
lieu of Section 316(a)(1)(B) of the TIA and such Section 316(a)(1)(B) of the TIA
is hereby expressly excluded from this Trust Agreement and the Securities, as
permitted by the TIA. Upon such waiver, any such default shall cease to exist,
and any Trust Enforcement Event with respect to the Preferred Securities arising
therefrom shall be deemed to have been cured, for every purpose of this Trust
Agreement and the Preferred Securities, but no such waiver shall extend to any
subsequent or other Trust Enforcement Event with respect to the Preferred
Securities or impair any right consequent thereon. Any waiver by the Holders of
the Preferred Securities of a Trust Enforcement Event with respect to the
Preferred Securities shall also be deemed to constitute a waiver by the Holders
of the Common Securities of any such Trust Enforcement Event with respect to the
Common Securities for all purposes of this Trust Agreement without any further
act, vote, or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in Liquidation Amount of
the Common Securities may, by vote or written consent, on behalf of the Holders
of all of the Common Securities, waive any past Trust Enforcement Event in
respect of the Common Securities and its consequences; PROVIDED that, if the
underlying Indenture Event of Default:
(i) is not waivable under the Indenture, except
where the Holders of the Common Securities are deemed to have waived
such Trust Enforcement Event under the Trust Agreement as provided
below in this Section 2.6(b), the Trust Enforcement Event under the
Trust Agreement shall also not be waivable; or
(ii) requires the consent or vote of a Super
Majority to be waived under the Indenture, except where the Holders of
the Common Securities are deemed to have waived such Trust Enforcement
Event under the Trust Agreement as provided below in this Section
2.6(b), the Trust Enforcement Event under the Trust Agreement may only
be waived by the vote or written consent of the Holders of at least the
proportion in aggregate liquidation amount of the Common Securities
that the relevant Super Majority represents of the aggregate principal
amount of the Debentures outstanding;
PROVIDED, FURTHER, each Holder of Common Securities will be deemed to have
waived any Trust Enforcement Event and all Trust Enforcement Events with respect
to the Common Securities and the consequences thereof until all Trust
Enforcement Events with respect to the Preferred Securities have been cured,
waived or otherwise eliminated, and until such Trust Enforcement Events with
respect to the Preferred Securities have been so cured, waived or otherwise
eliminated, the Property Trustee will be deemed to be acting solely on behalf of
the Holders of the Preferred Securities and only the Holders of the Preferred
Securities will have the right to direct the Property Trustee in accordance with
the terms of this Trust Agreement and the Indenture.
The foregoing provisions of this Section 2.6(b) shall be in
lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) of the TIA and such Sections
316(a)(1)(A) and 316(a)(1)(B) of the TIA are hereby expressly excluded from this
Trust Agreement and
11
the Securities, as permitted by the TIA. Subject to the foregoing provisions
of this Section 2.6(b), upon such cure, waiver or other elimination, any such
default shall cease to exist and any Trust Enforcement Event with respect to
the Common Securities 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 Trust Enforcement Event with respect to the Common
Securities or impair any right consequent thereon.
(c) A waiver of an Indenture Event of Default by the
Property Trustee at the direction of the Holders of the Preferred Securities
constitutes a waiver of the corresponding Trust Enforcement Event with respect
to the Preferred Securities under this Trust Agreement. The foregoing provisions
of this Section 2.6(c) shall be in lieu of Section 316(a)(1)(B) of the TIA and
such Section 316(a)(1)(B) of the TIA is hereby expressly excluded from this
Trust Agreement and the Securities, as permitted by the TIA.
Section 2.7. NOTICE OF TRUST ENFORCEMENT EVENT BY PROPERTY
TRUSTEE.
If a Trust Enforcement Event occurs and is continuing with
respect to the Securities and if it is known to a Responsible Officer of the
Property Trustee, the Property Trustee shall mail to each Holder of Securities
notice of a Trust Enforcement Event within 90 days after it occurs or, if later,
after a Responsible Officer of the Property Trustee has knowledge of such Trust
Enforcement Event. Except in the case of a Trust Enforcement Event caused by a
default in payment of principal of or interest on any Debentures, the Property
Trustee may withhold the notice if and so long as its corporate trust committee
or a committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of Holders of Securities.
ARTICLE 3
ORGANIZATION
Section 3.1. NAME AND ORGANIZATION. The Trust hereby continued
is named "Disney Capital Trust [I / II / III]" as such name may be modified from
time to time by the Administrative Trustees following written notice to the
Holders of Securities, the Property Trustee and the Delaware Trustee. The
Trust's activities may be conducted under the name of the Trust or any other
name deemed advisable by the Administrative Trustees.
Section 3.2. OFFICE. The address of the principal office of
the Trust is c/o The ▇▇▇▇ Disney Company, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. On 10 Business Days' written notice to the Holders of
Securities, the Property Trustee and the Delaware Trustee, the Administrative
Trustees may designate another principal office.
Section 3.3. PURPOSE. The exclusive purposes and functions of
the Trust are (a) to issue and sell Securities and use the gross proceeds from
such sale to acquire the Debentures, (b) making Distributions to Holders of
Securities as herein
12
provided and (c) except as otherwise limited herein, to engage in only those
other activities necessary, advisable or incidental thereto. The Trust shall
not borrow money, issue debt or reinvest proceeds derived from investments,
pledge any of its assets or otherwise undertake (or permit to be undertaken)
any activity that would cause the Trust not to be classified as a grantor
trust for United States federal income tax purposes.
By the acceptance of this Trust, none of the Trustees, the
Sponsor, the Holders of the Preferred Securities or Common Securities or the
Beneficial Owners will take any position for United States federal income tax
purposes which is contrary to the classification of the Trust as a grantor
trust.
Section 3.4. AUTHORITY. Subject to the limitations provided in
this Trust Agreement and to the specific duties of the Property Trustee, the
Administrative Trustees shall have exclusive authority to carry out the purposes
of the Trust. An action taken by the Administrative Trustees in accordance with
their powers shall constitute the act of and serve to bind the Trust, and an
action taken by the Property Trustee on behalf of the Trust 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 Trust Agreement.
(a) Except as expressly set forth in this Trust Agreement
and except if a meeting of the Administrative Trustees is called with respect to
any matter over which the Administrative Trustees have power to act, any power
of the Administrative Trustees may be exercised by, or with the consent of, any
one such Administrative Trustee.
(b) Unless otherwise determined by the Administrative
Trustees, and except as otherwise required by the Business Trust Act or
applicable law, any Administrative Trustee is authorized to execute on behalf of
the Trust any documents which the Administrative Trustees have the power and
authority to cause the Trust to execute.
(c) Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purposes of signing any documents which the
Administrative Trustees have power and authority to cause the Trust to execute.
Section 3.5. TITLE TO PROPERTY OF THE TRUST. Except as
provided in Section 3.8 with respect to the Debentures and the Property Account
or as otherwise provided in this Trust Agreement, 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
ownership interest in the assets of the Trust.
13
Section 3.6. POWERS AND DUTIES OF THE ADMINISTRATIVE TRUSTEES.
The Administrative Trustees shall have the exclusive power, duty and authority
to cause the Trust to engage in the following activities:
(a) issue and sell the Preferred Securities and the
Common Securities in accordance with this Trust Agreement; PROVIDED, HOWEVER,
that the Trust may issue no more than one series of Preferred Securities and no
more than one series of Common Securities; and PROVIDED, FURTHER, that there
shall be no interests in the Trust other than the Securities and, except as
provided in Section 7.18, the issuance of Securities shall be limited to a
one-time, simultaneous issuance of both Preferred Securities and Common
Securities on the Closing Date;
(b) in connection with the issue and sale of the
Preferred Securities, at the direction of the Sponsor, to execute and file any
documents prepared by the Sponsor, or take any acts as determined by the Sponsor
to be necessary, in order to qualify or register all or part of the Preferred
Securities in any State in which the Sponsor has determined to qualify or
register such Preferred Securities for sale;
(c) in connection with the issue and sale of Preferred
Securities, to execute and deliver on behalf of the Trust the Agreement as to
Expenses and Liabilities;
(d) to acquire the Debentures with the proceeds of the
sale of the Preferred Securities and the Common Securities; PROVIDED, HOWEVER,
that the Administrative Trustees shall cause legal title to the Debentures to be
held of record in the name of the Property Trustee for the benefit of the Trust,
the Holders of the Preferred Securities and the Holders of the Common
Securities;
(e) to give the Sponsor and the Property Trustee prompt
written notice of the occurrence of a Special Event;
(f) to establish a record date with respect to all
actions to be taken hereunder that require a record date be established,
including and with respect to, for the purposes of Section 316(c) of the TIA,
Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of Preferred Securities and Holders of Common Securities
as to such actions and applicable record dates;
(g) to take all actions and perform such duties as may be
required of the Administrative Trustees pursuant to the terms of this Trust
Agreement and the Securities;
(h) to bring or defend, pay, collect, compromise,
arbitrate, resort to legal action or otherwise adjust claims or demands of or
against the Trust ("Legal Action"), unless pursuant to Section 3.8(e), the
Property Trustee has the exclusive power to bring such Legal Action;
(i) to employ or otherwise engage employees and agents
(who may be designated as officers with titles) and managers, contractors,
advisors and consultants to
14
conduct only those services that the Administrative Trustees have authority
to conduct directly, and to pay reasonable compensation for such services;
(j) to cause the Trust to comply with the Trust's
obligations under the TIA;
(k) to give the certificate required by Section 314(a)(4)
of the TIA to the Property Trustee, which certificate may be executed by any
Administrative Trustee;
(l) to incur expenses that are necessary or incidental to
carry out any of the purposes of the Trust;
(m) to act as, or appoint another person to act as,
registrar and transfer agent for the Securities;
(n) to give prompt written notice to the Holders of the
Securities of any notice received from the Debenture Issuer of its election to
defer payments of interest on the Debentures by extending the interest payment
period under the Debentures as authorized by the Indenture;
(o) to take all action that may be necessary or
appropriate for the preservation and the continuation of the Trust's valid
existence, rights, franchises and privileges as a statutory business trust under
the laws of the State of Delaware and of each other jurisdiction in which such
existence is necessary to protect the limited liability of the Holders of the
Preferred Securities and the Holders of the Common Securities or to enable the
Trust to effect the purposes for which the Trust was created;
(p) to take any action, not inconsistent with applicable
law, that the Administrative Trustees determine in their discretion to be
necessary or desirable in carrying out the purposes and functions of the Trust
as set out in Section 3.3 or the activities of the Trust as set out in this
Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered under the 1940 Act;
(ii) causing the Trust to be classified as a
grantor trust for United States federal income tax purposes; and
(iii) cooperating with the Debenture Issuer to
ensure that the Debentures will be treated as indebtedness of the
Debenture Issuer for United States federal income tax purposes;
(q) to take all action necessary to cause all applicable
tax returns and tax information reports that are required to be filed with
respect to the Trust to be duly prepared and filed by the Administrative
Trustees, on behalf of the Trust; and
15
(r) to execute and deliver all documents or instruments,
perform all duties and powers, and do all things for and on behalf of the Trust
in all matters necessary or incidental to the foregoing.
The Administrative Trustees shall exercise the powers set
forth in this Section 3.6 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Administrative Trustees
shall have no power to, and shall not, take any action that is inconsistent with
the purposes and functions of the Trust set forth in Section 3.3.
Subject to this Section 3.6, the Administrative Trustees shall
have none of the powers or the authority of the Property Trustee set forth in
Section 3.8.
Any expenses incurred by the Administrative Trustees pursuant
to this Section 3.6 shall be reimbursed by the Sponsor.
Section 3.7. PROHIBITION OF ACTIONS BY THE TRUST AND THE
TRUSTEES.
(a) The Trust shall not, and none of the Trustees
(including the Property Trustee) shall cause the Trust to, engage in any
activity other than as required or authorized by this Trust Agreement. In
particular, the Trust shall not and none of the Trustees (including the Property
Trustee) shall cause the Trust to:
(i) invest any proceeds received by the Trust
from holding the Debentures, but shall distribute all such proceeds to
Holders of Securities pursuant to the terms of this Trust Agreement 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 other than loans represented
by the Debentures or incur any indebtedness;
(v) possess any power or otherwise act in such a
way as to vary the Trust assets;
(vi) possess any power or otherwise act in such a
way as to vary the terms of the Securities in any way whatsoever
(except to the extent expressly authorized in this Trust Agreement or
by the terms of the Securities);
(vii) issue any securities or other evidences of
beneficial ownership of, or beneficial interest in, the Trust other
than the Securities;
(viii) other than as provided in this Trust
Agreement or by the terms of the Securities, (A) direct the time,
method and place of exercising any trust or power conferred upon the
Indenture Trustee with respect to the Debentures, (B) waive any past
default that is waivable under the Indenture, (C) exercise any right
16
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, acting through the
Administrative Trustees, shall have received an Opinion of Counsel to
the effect that such amendment or modification will not cause more
than an insubstantial risk that the Trust will be deemed an Investment
Company required to be registered under the 1940 Act, or the Trust
will not be classified as a grantor trust for United States federal
income tax purposes;
(ix) take any action inconsistent with the status
of the Trust as a grantor trust for United States federal income tax
purposes; or
(x) revoke any action previously authorized or
approved by vote of the Holders of the Preferred Securities except
pursuant to a subsequent vote of the Holders of the Preferred
Securities.
Section 3.8. POWERS AND DUTIES OF THE PROPERTY TRUSTEE.
(a) The legal title to the Debentures shall be owned by
and held of record in the name of the Property Trustee for the benefit of the
Trust and the Holders of the Securities. The right, title and interest of the
Property Trustee to the Debentures shall vest automatically in each person who
may hereafter be appointed as Property Trustee in accordance with Section 6.6.
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 Property Trustee shall not transfer its right,
title and interest in the Debentures to the Administrative Trustees or to the
Delaware Trustee (if the Property Trustee does not also act as Delaware
Trustee).
(c) The Property 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 Property Trustee 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 Property Trustee,
deposit such funds into the Property Account and make payments to the
Holders of the Preferred Securities and Holders of the Common
Securities from the Property Account in accordance with Section 7.2.
Funds in the Property Account shall be held uninvested until disbursed
in accordance with this Trust Agreement. The Property Account shall be
an account that is maintained with a banking institution the rating on
whose long-term unsecured indebtedness is at least equal to the rating
assigned to the Preferred Securities by a "nationally recognized
statistical rating organization," within the meaning of Rule 436(g)(2)
under the Securities Act;
17
(ii) engage in such ministerial activities as
shall be necessary or appropriate to effect the redemption of the
Preferred Securities and the Common Securities to the extent the
Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued
by the Administrative Trustees in accordance with the terms of the
Securities, engage in such ministerial activities as so directed and as
shall be necessary or appropriate to effect the distribution of the
Debentures to Holders of Securities upon the occurrence of a Special
Event.
(d) The Property Trustee shall take all actions and
perform such duties as may be specifically required of the Property Trustee
pursuant to the terms of this Trust Agreement and the Securities.
(e) Subject to Section 3.9(b), the Property Trustee may
take any Legal Action which arises out of or in connection with a Trust
Enforcement Event or the Property Trustee's duties and obligations under this
Trust Agreement or the TIA; PROVIDED, HOWEVER, that if a Trust Enforcement Event
has occurred and is continuing and such event is attributable to the failure of
the Debenture Issuer to pay interest, principal or other required payments on
the Debentures on the date such interest, principal or other required payments
are otherwise payable (or in the case of redemption, on the redemption date),
then a Holder of Preferred Securities may directly institute a proceeding
against the Debenture Issuer for enforcement of payment to such Holder of the
principal of (including premium, if any) or interest (including any Additional
Interest, as defined in the Indenture) on Debentures having a principal amount
equal to the aggregate liquidation amount of the Preferred Securities of such
Holder (a "Direct Action") on or after the respective due date specified in the
Debentures. Notwithstanding anything to the contrary in this Trust Agreement or
the Indenture, the Debenture Issuer shall have the right to set-off any payment
it is otherwise required to make under the Indenture in respect of any Preferred
Security to the extent the Debenture Issuer has heretofore made, or is currently
on the date of such payment making, a payment under the Guarantee relating to
such Preferred Security or under Section 7.3 of the Indenture.
(f) The Property 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
Securities pursuant to the terms of the Securities; or
(ii) a successor Property Trustee has been
appointed and has accepted that appointment in accordance with Section
6.6.
(g) The Property Trustee shall have the legal power to
exercise all of the rights, powers and privileges of a holder of Debentures
under the Indenture and, if a Trust Enforcement Event occurs and is
continuing, the Property Trustee shall, for the benefit of Holders of the
Securities, enforce its rights as holder of the Debentures subject
18
to the rights of the Holders pursuant to this Trust Agreement and the terms
of the Securities.
(h) The Property Trustee may authorize one or more
Persons (each, a "Paying Agent") to pay Distributions, redemption payments or
liquidation payments on behalf of the Trust with respect to all Securities and
any such Paying Agent shall comply with Section 317(b) of the TIA. Any Paying
Agent may be removed by the Property Trustee at any time and a successor Paying
Agent or additional Paying Agents may be appointed at any time by the Property
Trustee.
(i) Subject to this Section 3.8, the Property Trustee
shall have none of the duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 3.6.
The Property Trustee shall exercise the powers set forth in
this Section 3.8 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 3.3, and the Property Trustee shall have no
power to, and shall not, take any action that is inconsistent with the purposes
and functions of the Trust set out in Section 3.3.
Section 3.9. DUTIES AND RESPONSIBILITIES OF THE PROPERTY
TRUSTEE.
(a) If a Trust Enforcement Event has occurred and is
continuing, the Property Trustee shall exercise the rights and powers vested in
it by this Trust Agreement and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
(b) Except during the continuance of any Trust
Enforcement Event:
(i) the Property Trustee need perform only those
duties that are specifically set forth in this Trust Agreement and no
others; and
(ii) in the absence of bad faith on its part, the
Property Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
Officers' Certificates or Opinions of Counsel furnished to the Property
Trustee and conforming to the requirements of this Trust Agreement;
HOWEVER, in the case of any such Officers' Certificates or Opinions of
Counsel which by any provision hereof are specifically required to be
furnished to the Property Trustee, the Property Trustee shall examine
such Officers' Certificates and Opinions of Counsel to determine
whether or not they conform to the requirements of this Trust
Agreement.
(c) The Property Trustee may not be relieved from
liability for its own negligent action, its own negligent failure to act or its
own willful misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section;
19
(ii) the Property Trustee shall not be liable for
any error of judgment made in good faith by a Responsible Officer,
unless it is proved that the Property Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Property Trustee shall not be liable
with respect to any action taken or omitted to be taken by it with
respect to the Securities in good faith in accordance with the
direction of the Holders of not less than a Majority in Liquidation
Amount of the Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Property
Trustee or exercising any trust or power conferred upon the Property
Trustee under this Trust Agreement.
(d) Every provision of this Trust Agreement that in any
way relates to the Property Trustee is subject to paragraphs (a), (b) and (c) of
this Section 3.9.
(e) The Property Trustee may refuse to perform any duty
or exercise any right or power unless it receives indemnity satisfactory to it
against any loss, liability or expense.
(f) Money held in trust by the Property Trustee need not
be segregated from other funds except in relation to the Property Account
maintained pursuant to Section 3.8(c)(i) and except to the extent required by
law. The Property Trustee shall not be liable for interest on any money received
by it except as the Property Trustee may agree in writing with the Sponsor.
(g) No provision of this Trust Agreement shall require
the Property Trustee to risk its own funds or otherwise incur any financial
liability in the performance of any of its duties, or in the exercise of any of
its rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or indemnity reasonably satisfactory to it against
such risk is not reasonably assured to it.
(h) The Property Trustee's sole duty with respect to the
custody, safe-keeping and physical preservation of the Debentures and the
Property Account shall be to deal with such property in a similar manner as the
Property Trustee deals with similar property for its own account, subject to the
protections and limitations on liability afforded to the Property Trustee under
this Trust Agreement and the TIA.
(i) The Property Trustee shall have no duty or liability
for or with respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments levied thereon or in
connection therewith.
(j) The Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the Sponsor with
their respective duties under this Trust Agreement, nor shall the Property
Trustee be liable for any default or misconduct of the Administrative Trustees
or the Sponsor.
20
Section 3.10. RIGHTS OF PROPERTY TRUSTEE.
(a) The Property Trustee may rely on and shall be
protected in acting or refraining from acting upon any document believed by it
to be genuine and to have been signed or presented by the proper person. The
Property Trustee need not investigate any fact or matter stated in the document.
(b) Before the Property Trustee acts or refrains from
acting, it may require an Officers' Certificate or an Opinion of Counsel. The
Property Trustee shall not be liable for any action it takes or omits to take in
good faith in reliance on such Officers' Certificate or Opinion of Counsel.
(c) The Property Trustee may act through agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care. No Depositary shall be deemed an agent of the Property Trustee and the
Property Trustee shall not be responsible for any act or omission by any
Depositary.
(d) Subject to the provisions of Section 3.9(c), the
Property Trustee shall not be liable for any action it takes or omits to take in
good faith which it believes to be authorized or within its rights or powers.
(e) The Property Trustee may consult with counsel and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon.
(f) The Property Trustee shall be under no obligation
to exercise any of the rights or powers vested in it by this Trust Agreement
at the request or direction of any of the Holders of Securities unless such
Holders shall have offered to the Property 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,
including such reasonable advances as may be requested by the Property
Trustee; PROVIDED, that nothing contained in this Section 3.10(f) shall be
taken to relieve the Property Trustee, upon the occurrence of a Trust
Enforcement Event, of its obligation to exercise the rights and powers vested
in it by this Trust Agreement in the manner provided by Section 3.9(a).
(g) Whenever in the administration of this Trust
Agreement the Property Trustee shall deem it desirable to receive instructions
with respect to enforcing any remedy or right or taking any other action
hereunder, the Property Trustee (i) may request instructions from the Holders of
the Securities which instructions may only be given by the Holders of the same
proportion in liquidation amount of the Securities as would been entitled to
direct the Property Trustee under the terms of the 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 protected in conclusively relying on or acting in accordance with such
instructions.
21
(h) Except as otherwise expressly provided by this Trust
Agreement, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Trust Agreement.
(i) When the Property Trustee incurs expenses or renders
services in connection with a bankruptcy, the expenses and the compensation for
the services are intended to constitute expenses of administration under any
bankruptcy law or law for the relief of debtors generally.
(j) No provision of this Trust Agreement shall be deemed
to impose any duty or obligation on the Property 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 Property
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 Property Trustee
shall be construed to be a duty.
Section 3.11. DELAWARE TRUSTEE. Notwithstanding any other
provision of this Trust Agreement other than Section 6.2, the Delaware Trustee
shall not be entitled to exercise any powers, nor shall the Delaware Trustee
have any of the duties and responsibilities of the Administrative Trustees or
the Property Trustee described in this Trust Agreement. Except as set forth in
Section 6.2, the Delaware Trustee shall be a Trustee for the sole and limited
purpose of fulfilling the requirements of Section 3807(a) of the Business Trust
Act. In the event the Delaware Trustee shall at any time be required to take any
action or perform any duty hereunder with respect to the Trust, the Delaware
Trustee shall be entitled to all of the same rights as the Property Trustee
listed in Sections 3.9(b)-(h) and Section 3.10. No implied covenants or
obligations shall be read into this Trust Agreement against the Delaware
Trustee. It is expressly understood and agreed by the parties hereto that in
fulfilling its obligations as Delaware Trustee hereunder on behalf of the Trust
(i) any agreements or instruments executed and delivered by Wilmington Trust
Company are executed and delivered not in its individual capacity but solely as
Delaware Trustee under this Trust Agreement in the exercise of the powers and
authority conferred and vested in it, (ii) each of the representations,
undertakings and agreements herein made on the part of the Trust is made and
intended not as representations, warranties, covenants, undertakings and
agreements by Wilmington Trust Company in its individual capacity but is made
and intended for the purpose of binding only the Trust, and (iii) under no
circumstances shall Wilmington Trust Company in its individual capacity be
personally liable for the payment of any indebtedness or expenses of the Trust
or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Trust under this Trust Agreement,
except if such breach or failure is due to any gross negligence or willful
misconduct of the Delaware Trustee.
Section 3.12. EXECUTION OF DOCUMENTS. Unless otherwise
determined by the Administrative Trustees, and except as otherwise required by
the Business Trust Act or applicable law, any Administrative Trustee is
authorized to execute on behalf of the
22
Trust any documents that the Administrative Trustees have the power and
authority to execute pursuant to Section 3.6.
Section 3.13. TRUSTEES' DISCLAIMER. The Trustees make no
representation as to the validity or adequacy of this Trust Agreement, the
Securities, the Indenture or the Debentures; they shall not be accountable for
the Debenture Issuer's use of the proceeds from the Debentures, and they shall
not be responsible for any statement in the Debentures or the Securities, except
that the Property Trustee and the Administrative Trustees shall be responsible
for the Securities' authentication.
Section 3.14. DURATION OF TRUST. The Trust shall exist until
terminated pursuant to the provisions of Article 8 hereof.
Section 3.15. MERGERS.
(a) The Trust may not consolidate, merge with or into, or
be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to any person, except as described in Section
3.15(b) and (c) or Section 8.2.
(b) The Trust may, at the request of the Sponsor and with
the consent of the Administrative Trustees or, if there are more than two, a
majority of the Administrative Trustees and without the consent of the Holders
of the Securities, the Delaware Trustee or the Property Trustee, consolidate,
merge with or into, or be replaced by or convey, transfer or lease its
properties substantially as an entirety to a trust organized as such under the
laws of any State; PROVIDED, that:
(i) if the Trust is not the successor, such
successor entity (the "Successor Entity") either:
a. expressly assumes all of the obligations
of the Trust with respect to the Securities; or
b. substitutes for the Preferred Securities
other securities having substantially the same terms as the
Preferred Securities (the "Successor Securities") so long as
the Successor Securities rank the same as the Preferred
Securities rank in priority with respect to Distributions and
payments upon liquidation, redemption and otherwise;
(ii) if the Trust is not the Successor Entity,
the Sponsor expressly appoints a trustee of such Successor Entity that
possesses the same powers and duties as the Property Trustee as the
holder of the Debentures;
(iii) the Preferred Securities or any Successor
Securities are listed, or any Successor Securities will be listed upon
notification of issuance, on any national securities exchange or with
any other or organization on which the Preferred Securities are then
listed or quoted;
23
(iv) such merger, consolidation, replacement,
conveyance, transfer or lease does not cause the Preferred Securities
(including any Successor Securities) to be downgraded by any nationally
recognized statistical rating organization;
(v) such merger, consolidation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders of the Preferred Securities
(including any Successor Securities) in any material respect other than
with respect to the dilution of the Holders' interest in the new
entity;
(vi) such Successor Entity has a purpose
identical to that of the Trust;
(vii) prior to such merger, consolidation,
replacement, conveyance, transfer or lease the Sponsor has received an
opinion of independent counsel to the Trust experienced in such matters
to the effect that:
a. such merger, consolidation, replacement,
conveyance, transfer or lease does not adversely affect the
rights, preferences and privileges of the Holders of the
Preferred Securities (including any Successor Securities) in
any material respect (including any Successor Securities)
other than with respect to the dilution of the Holders'
interest in the new entity;
b. following such merger, consolidation,
replacement, conveyance, transfer or lease, neither the Trust
nor the Successor Entity will be required to register as an
Investment Company; and
c. following such merger, consolidation or
replacement, the Trust (or the Successor Entity) will continue
to be classified as a grantor trust for United States federal
income tax purposes;
(viii) the Sponsor or any permitted successor or
assignee owns all of the common securities and guarantees the
obligations of such Successor Entity under the Successor Securities at
least to the extent provided by the Guarantee; and
(ix) such Successor Entity expressly assumes all
of the obligations of the Trust with respect to the Trustees.
(c) Notwithstanding Section 3.15(b), the Trust shall not,
except with the consent of Holders of 100% in aggregate liquidation amount of
the Securities, consolidate, merge with or into, or be replaced by or convey,
transfer or lease its properties and assets substantially as an entirety to, any
other entity or permit any other entity to consolidate, merge with or into, or
replace it, if in the opinion of independent tax counsel experienced in such
matters such consolidation, merger, replacement, conveyance, transfer or lease
would cause the Trust or Successor Entity to be classified
24
as other than a grantor trust for United States federal income tax purposes
and each Holder of the Securities not to be treated as owning an undivided
interest in the Debentures.
Section 3.16. PROPERTY TRUSTEE MAY FILE PROOFS OF CLAIM. In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other similar judicial
proceeding relative to the Trust or any other obligor upon the Securities or the
property of the Trust or of such other obligor or their creditors, the Property
Trustee (irrespective of whether any Distributions on the Securities shall then
be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Property Trustee shall have made any demand on the
Trust for the payment of any past due Distributions) shall be entitled and
empowered, to the fullest extent permitted by law, by intervention in such
proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Securities and to file such
other papers or documents as may be necessary or advisable in order to have the
claims of the Property Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel) and of the Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the
Property Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or compensation
affecting the Securities or the rights of any Holder thereof or to authorize the
Property Trustee to vote in respect of the claim of any Holder in any such
proceeding.
ARTICLE 4
SPONSOR
Section 4.1. RESPONSIBILITIES OF THE SPONSOR. In connection
with the issue and sale of the Preferred Securities, the Sponsor shall have the
exclusive right and responsibility to engage in the following activities:
(a) to prepare, execute and file on behalf of the Trust
an application to the New York Stock Exchange or any other national stock
exchange or the NASDAQ
25
Stock Market for listing upon notice of issuance of any Preferred Securities,
the Guarantee and the Debentures;
(b) to prepare, execute and file on behalf of the Trust
with the Commission under the Securities Act or the Exchange Act one or more
registration statements on the applicable forms, including any amendments
thereto, pertaining to the Preferred Securities, the Guarantee and the
Debentures;
(c) to determine the States in which to take appropriate
action to qualify or register for sale all or part of the Preferred Securities
and to do any and all such acts, other than actions which must be taken by 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
(d) to negotiate the terms of and to execute on behalf of
the Trust an underwriting agreement and other related agreements providing for
the sale of the Preferred Securities.
Section 4.2. COMPENSATION AND INDEMNIFICATION. Pursuant to the
Agreement as to Expenses and Liabilities, the Sponsor shall pay to each of the
Property Trustee and the Delaware Trustee from time to time reasonable
compensation for their services. Such Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Sponsor
shall reimburse each Trustee upon request for all reasonable out-of-pocket
expenses incurred by it. Such expenses shall include the reasonable compensation
and expenses of the Trustee's agents and counsel.
ARTICLE 5
TRUST COMMON SECURITIES HOLDER
Section 5.1. DEBENTURE ISSUER'S PURCHASE OF COMMON SECURITIES.
On the applicable Closing Date, the Debenture Issuer will purchase all of the
Common Securities issued by the Trust on such Closing Date, for an amount at
least equal to 3% of the capital of the Trust at such time, at the same time as
Preferred Securities are sold; PROVIDED that, if the Option set forth in Section
7.18(a) is exercised, then the Debenture Issuer will purchase such additional
Common Securities from the Trust on such second Closing Date such that it will
then hold at least 3% of the capital of the Trust.
The aggregate stated liquidation amount of Common Securities
outstanding at any time shall not be less than 3% of the capital of the Trust.
Section 5.2. COVENANTS OF THE COMMON SECURITIES HOLDER. For so
long as the Preferred Securities remain outstanding, the Common Securities
Holder will covenant (i) to maintain, directly or indirectly, 100% ownership of
the Common Securities, (ii) to cause the Trust to remain a statutory business
trust and not to voluntarily dissolve, wind up, liquidate or be terminated,
except as permitted by this
26
Trust Agreement, (iii) to use its commercially reasonable efforts to ensure
that the Trust will not be an investment company for purposes of the 1940
Act, and (iv) to take no action which would be reasonably likely to cause the
Trust to be classified as an association or a publicly traded partnership
taxable as a corporation for United States federal income tax purposes.
ARTICLE 6
TRUSTEES
Section 6.1. NUMBER OF TRUSTEES. The number of Trustees
initially shall be five, 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 Common Securities voting as a class at a meeting of
the Holders of the Common Securities or by written consent in lieu of such
meeting; PROVIDED that the number of Trustees shall be at least three; and
PROVIDED, FURTHER, that (i) the Delaware Trustee, in the case of a natural
person, shall be a person who is a resident of the State of Delaware or that, if
not a natural person, is an entity which has its principal place of business in
the State of Delaware and otherwise meets the requirements of applicable law;
(ii) at least one Administrative Trustee is an employee or officer of, or is
affiliated with, the Sponsor; and (iii) one Trustee shall be the Property
Trustee for so long as this Trust Agreement is required to qualify as an
indenture under the TIA, and such Trustee may also serve as Delaware Trustee if
it meets the applicable requirements.
Section 6.2. DELAWARE TRUSTEE; ELIGIBILITY. If required by the
Business Trust Act, one Trustee (which may be the Property Trustee) (the
"Delaware Trustee") shall be:
(a) a natural person who is a resident of the State of
Delaware; or
(b) if not a natural person, an entity which has its
principal place of business in the State of Delaware, and otherwise meets the
requirements of applicable law; PROVIDED that, if the Property Trustee has its
principal place of business in the State of Delaware and otherwise meets the
requirements of applicable law, then the Property Trustee shall also be the
Delaware Trustee and Section 3.11 shall have no application.
Section 6.3. PROPERTY TRUSTEE; ELIGIBILITY; DISQUALIFICATION.
This Trust Agreement shall always have a Property Trustee who
satisfies the requirements of Sections 310(a)(1), (2) and (5) of the TIA. The
Property Trustee shall always have a combined capital and surplus of at least
$25,000,000 as set forth in its
27
most recent published annual report of condition. The Property Trustee shall
comply with Section 310(b) of the TIA.
Section 6.4. QUALIFICATIONS OF ADMINISTRATIVE TRUSTEES AND
DELAWARE TRUSTEE GENERALLY. Each Administrative Trustee and the Delaware Trustee
(unless the Property Trustee also acts as Delaware Trustee) shall be either a
natural person who is at least 21 years of age or a legal entity that shall act
through one or more Authorized Officers.
Section 6.5. INITIAL ADMINISTRATIVE TRUSTEES. The initial
Administrative Trustees shall be: ________, ________ and ________, the business
address of all of whom is The ▇▇▇▇ Disney Company, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 6.6. REPLACEMENT OF TRUSTEES.
(a) Subject to Section 6.6(b), Trustees may be appointed
or removed without cause at any time:
(i) until the issuance of any Securities, by
written instrument executed by the Sponsor;
(ii) after the issuance of any Securities, but
not while an Indenture Event of Default has occurred and is
continuing, by vote of the Holders of a Majority in Liquidation
Amount of the Common Securities voting as a class at a meeting of
the Holders of the Common Securities; and
(iii) after the issuance of the Preferred
Securities during the continuance of an Indenture Event of Default, by
vote of the Holders of a Majority in Liquidation Amount of the
Preferred Securities.
(b) A Trustee may resign with respect to the Securities
by so notifying the Sponsor and the Trust. A resignation or removal of the
Property Trustee or Delaware Trustee and appointment of a successor Trustee
shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section or, in the case of the resignation of
the Property Trustee, if the assets of the Trust have been completely liquidated
and the proceeds distributed to the Holders of the Securities. The resignation
of an Administrative Trustee is effective upon delivery of notice to the Sponsor
and the Trust.
(c) The Holders of the Common Securities may remove the
Property Trustee or Delaware Trustee if:
28
(i) the Trustee fails to comply with Section
6.3, in the case of the Property Trustee, or Section 6.2 in the case of
the Delaware Trustee;
(ii) the Trustee is adjudged a bankrupt or an
insolvent or an order for relief is entered with respect to the Trustee
under any bankruptcy law or law for the relief of debtors generally;
(iii) a receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) takes charge of the Trustee or
its property; or
(iv) the Trustee becomes incapable of acting.
(d) If a Trustee resigns or is removed or if a vacancy
exists in the office of a Trustee for any reason, the
Holders of the Common Stock shall promptly appoint a successor Trustee.
(e) If a successor Property Trustee or Delaware Trustee
does not take office within 60 days after the retiring Property Trustee or
Delaware Trustee, as the case may be, resigns or is removed, the retiring
Trustee, the Sponsor or the Holders of at least 10% in Liquidation Amount of the
Securities may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
(f) If the Property Trustee fails to comply with Section
6.3, any Holder of Securities may petition any court of competent jurisdiction
for the removal of the Property Trustee and the appointment of a successor
Property Trustee.
(g) A successor Property Trustee shall deliver a written
acceptance of its appointment to the retiring Property Trustee and to the Trust
and Sponsor. Immediately after that, the retiring Property Trustee shall
transfer all property held by it as Property Trustee to the successor Property
Trustee, the resignation or removal of the retiring Property Trustee shall
become effective, and the successor Property Trustee shall have all the rights,
powers and duties of the Property Trustee. A successor Property Trustee shall
mail a notice of its succession to each Holder. Notwithstanding replacement of
the Property Trustee pursuant to this Section 6.6, the Sponsor's obligations
under Section 4.2 hereof shall continue for the benefit of the retiring Property
Trustee with respect to expenses and liabilities incurred by it prior to such
replacement.
(h) A successor Delaware Trustee shall deliver a written
acceptance of its appointment to the retiring Delaware Trustee and to the Trust
and Sponsor. Immediately after that, the resignation or removal of the retiring
Delaware Trustee shall become effective, and the successor Delaware Trustee
shall have all the rights, powers and duties of the Delaware Trustee. A
successor Delaware Trustee shall mail a notice of its succession to each Holder.
Section 6.7. VACANCIES AMONG TRUSTEES. If a Trustee ceases to
hold office for any reason and the number of Trustees is not reduced pursuant to
Section 6.1, or if the number of Trustees is increased pursuant to Section 6.1,
a vacancy shall occur. A resolution certifying the existence of such vacancy by
the Administrative Trustees or,
29
if there are more than two, a majority of the Administrative Trustees shall
be conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with a Trustee appointed in accordance with Section 6.6.
Section 6.8. 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 annul,
dissolve or terminate the Trust. Whenever a vacancy in the number of
Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 6.6, the
Administrative Trustees in office, regardless of their number, shall have all
the powers granted to the Administrative Trustees and shall discharge all the
duties imposed upon the Administrative Trustees by this Trust Agreement.
Section 6.9. MEETINGS. If there is more than one
Administrative Trustee, meetings of the Administrative Trustees may be held from
time to time upon the call of any Administrative Trustee. Regular meetings of
the Administrative Trustees may be held at a time and place fixed by resolution
of the Administrative Trustees. Notice of any in-person meetings of the
Administrative Trustees shall be hand delivered or otherwise delivered in
writing (including by facsimile) not less than 48 hours before such meeting.
Notice of any telephonic meetings of the Administrative Trustees shall be hand
delivered or otherwise delivered in writing (including by facsimile) 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 an Administrative Trustee at a meeting shall
constitute a waiver of notice of such meeting except where an Administrative
Trustee attends a meeting for the express purpose of objecting to the
transaction of any activity on the ground that the meeting has not been lawfully
called or convened. Unless provided otherwise in this Trust Agreement, any
action of the Administrative Trustees may be taken at a meeting by vote of a
majority of the Administrative Trustees 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
Administrative Trustees. In the event there is only one Administrative Trustee,
any and all action of such Administrative Trustee shall be evidenced by a
written consent of such Administrative Trustee.
Section 6.10. DELEGATION OF POWER.
(a) Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any natural person over the age of
21 his, her or its power for the purpose of executing any documents contemplated
in Section 3.6, including any registration statement or amendment thereto filed
with the Commission, or making any other governmental filing.
(b) The Administrative Trustees shall have power to
delegate from time to time to such of their number or to officers of the Trust
the doing of such things and the execution of such instruments either in the
name of the Trust or the names of the Administrative Trustees or otherwise as
the Administrative Trustees may deem
30
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 6.11. SUCCESSOR TRUSTEE BY MERGER, ETC. If a Property
Trustee or Delaware Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall be the successor Property Trustee or Delaware Trustee;
PROVIDED the successor corporation complies with the TIA provisions of Section
6.3 or Section 6.4, respectively.
ARTICLE 7
TERMS OF SECURITIES
Section 7.1. GENERAL PROVISIONS REGARDING SECURITIES.
(a) The Administrative Trustees shall on behalf of the
Trust issue one class of preferred securities representing undivided beneficial
ownership interests in the assets of the Trust and one class of common
securities representing undivided beneficial ownership interests in the assets
of the Trust.
(i) PREFERRED SECURITIES. The Preferred
Securities of the Trust have an aggregate liquidation amount with
respect to the assets of the Trust of ________ dollars ($________) with
respect to the [initial] closing of the sale of Preferred Securities
[and, if the Option set forth in Section 7.18(a) is exercised, an
additional aggregate liquidation amount with respect to the assets of
the Trust of ________ dollars ($________) with respect to the second
closing of the sale of Preferred Securities; PROVIDED that the maximum
aggregate liquidation amount of Preferred Securities of the Trust shall
not exceed ________ dollars ($________)]. The Preferred Securities are
hereby designated for identification purposes only as "__% Preferred
Securities" (the "Preferred Securities"). The Preferred Securities
shall be in substantially the form set forth in Exhibit A to this Trust
Agreement, or in such other form as shall be established by the
Administrative Trustees, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required or
permitted by this Trust Agreement, and may have such letters, numbers
or other marks of identification and such legends or endorsements
placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistent herewith, be determined by
the Administrative Trustees executing such Preferred Securities, as
evidenced by their execution of the Preferred Securities.
The definitive Preferred Securities shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the Administrative Trustees executing such
Preferred Securities, as evidenced by their execution of such Preferred
Securities.
31
(ii) COMMON SECURITIES. The Common Securities of
the Trust shall have an aggregate liquidation amount with respect to
the assets of the Trust of ________ dollars ($________) with respect to
the [initial] closing of the sale of Common Securities [and, if the
Option set forth in Section 7.18(a) is exercised, an additional
aggregate liquidation amount with respect to the assets of the Trust of
________ dollars ($________) with respect to the second closing of the
sale of Common Securities; PROVIDED that the maximum aggregate
liquidation amount of common securities issued by the Trust shall not
exceed ________ dollars ($________)]. The Common Securities are hereby
designated for identification purposes only as "__% Common Securities"
(the "Common Securities"). The Common Securities shall be in
substantially the form set forth in Exhibit B to this Trust Agreement,
or in such other form as shall be established by the Administrative
Trustees, in each case with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Trust Agreement, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may
be required to comply with the rules of any securities exchange or as
may, consistent herewith, be determined by the Administrative Trustees
executing such Common Securities, as evidenced by their execution of
the Common Securities.
The definitive Common Securities shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the Administrative Trustees executing such
Common Securities, as evidenced by their execution of such Common Securities.
(b) Payment of Distributions on, and payment of the
Redemption Price upon a redemption of, the Preferred Securities and the Common
Securities, as applicable, shall be made Pro Rata based on the liquidation
amount of such Preferred Securities and Common Securities; PROVIDED, HOWEVER,
that if on any date on which amounts payable on distribution or redemption, an
Indenture Event of Default shall have occurred and be continuing, no payment of
any Distribution on, or Redemption Price of, any of the Common Securities, and
no other payment on account of the redemption, liquidation or other acquisition
of such Common Securities, shall be made unless payment in full in cash of all
accumulated and unpaid Distributions on all of the outstanding Preferred
Securities for all Distribution periods terminating on or prior thereto, or, in
the case of amounts payable on redemption, the full amount of the Redemption
Price for all of the outstanding Preferred Securities then called for
redemption, shall have been made or provided for, and all funds available to the
Property Trustee shall first be applied to the payment in full in cash of all
Distributions on, or the Redemption Price of, the Preferred Securities then due
and payable. The Trust shall issue no securities or other interests in the
assets of the Trust other than the Preferred Securities and the Common
Securities.
(c) An Administrative Trustee shall sign the Securities
for the Trust by manual or facsimile signature.
32
If an Administrative Trustee whose signature is on a Security
no longer holds that office at the time the Security is authenticated, the
Security shall nevertheless be valid.
A Security shall not be valid until authenticated by the
manual signature of the Property Trustee or an authenticating agent. The
signature shall be conclusive evidence that the Security has been authenticated
under this Trust Agreement.
The Property Trustee shall at any time, and from time to time,
authenticate Securities for original issue in an amount not to exceed the
liquidation amounts set forth in Section 7.1(a), upon receipt by the Property
Trustee of a written order of the Trust signed by an Administrative Trustee (a
"Trust Order"). Such Trust Order may authorize authentication and delivery
pursuant to oral or electronic instructions from an Administrative Trustee,
which oral instructions shall be promptly confirmed in writing. Each Security
shall be dated the date of its authentication unless otherwise provided by a
Trust Order.
The aggregate number of Securities outstanding at any time may
not exceed the liquidation amounts set forth in Section 7.1(a), except as
provided in Section 7.10.
The Property Trustee shall have the right to decline to
authenticate and deliver any Securities: (a) if the Property Trustee, being
advised by counsel, determines that such action may not lawfully be taken; or
(b) if the Property Trustee in good faith by its board of directors or trustees,
executive committee or a trust committee of directors and/or vice-presidents
shall determine that such action would expose the Property Trustee to personal
liability to Holders of any Securities.
The Property Trustee may appoint an authenticating agent
acceptable to the Trust to authenticate Securities. An authenticating agent may
authenticate Securities whenever the Property Trustee may do so. Each reference
in this Trust Agreement to authentication by the Property Trustee includes
authentication by such agent. An authenticating agent has the same rights as any
registrar, paying agent or service agent to deal with the Trust.
(d) 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.
(e) Except to the extent set forth in Section 9.1(b),
upon issuance of the Securities as provided in this Trust Agreement, the
Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable undivided beneficial ownership interests in the assets of the
Trust.
(f) Every person, by virtue of having become a Holder or
a Preferred Security Beneficial Owner in accordance with the terms of this Trust
Agreement, shall be deemed to have expressly assented and agreed to the terms
of, and shall be bound by, this
33
Trust Agreement and the terms of the Securities, the Guarantee, the Indenture
and the Debentures.
(g) The holders of the Securities shall have no
preemptive or similar rights.
Section 7.2. DISTRIBUTIONS.
(a) Holders of Securities shall be entitled to receive
cumulative cash Distributions at the rate per annum of __% of the stated
liquidation amount of $__ per Security. The amount of Distributions payable
for any period shall be computed on the basis of a 360-day year of twelve
30-day months. The amount of distributions payable for any period shorter
than a full [quarterly] [semi-annual] distribution period shall be computed
on the basis of a 30-day month and for periods of less than a month, the
actual number of days elapsed per 30-day month. Subject to Section 7.1(b),
Distributions shall be made on the Preferred Securities and the Common
Securities on a Pro Rata basis. Distributions on the Securities shall, from
the date of original issue, accumulate and be cumulative and shall be payable
[quarterly][semi-annually], in arrears, on each ________ [,________,________]
and ________, commencing ________ __, 200_, when, as and if available for
payment, by the Property Trustee, except as otherwise described below.
Distributions are payable only to the extent that payments are made in
respect of the Debentures held by the Property Trustee and to the extent that
the Trust has funds available for the payment of such Distributions in the
Property Account.
(b) Distributions not paid on the scheduled payment date,
including Distributions not paid during any Extension Period (as defined below),
will accumulate and compound [quarterly][semi-annually] at the rate of __% per
annum, to the extent permitted by applicable law ("Compounded Distributions").
"Distributions" shall mean ordinary cumulative distributions together with any
Compounded Distributions. So long as no Indenture Event of Default has occurred
and is continuing, the Sponsor shall have the right, at any time during the term
of the Debentures, from time to time to defer the payment of interest on such
Debentures in the manner and for such period or periods not exceeding 20
consecutive periods as may be specified as contemplated by the Indenture (each,
an "Extension Period") during which Extension Periods no interest on the
Debentures shall be due and payable. As a consequence of such deferral,
Distributions will also be deferred. No Extension Period shall end on a date
other than an interest payment date for the Debentures or extend beyond the
Stated Maturity (as defined in the Indenture) of the Debentures. At the end of
any such Extension Period the Sponsor shall pay all interest then accrued and
unpaid on the Debentures (together with any additional amounts payable as
contemplated by Section 2.3(a)(15) of the Indenture or other interest thereon,
if any, at the rate specified for the Debentures to the extent permitted by
applicable law).
34
(c) If and to the extent that the Debenture Issuer makes
a payment of interest, premium and/or principal on the Debentures held by the
Property Trustee (the amount of any such payment being a "Payment Amount"), the
Property Trustee shall and is directed, to the extent funds are available for
that purpose, to make a Pro Rata distribution of the Payment Amount to Holders,
subject to Section 7.1(b).
(d) Distributions on the Securities shall be payable to
the Holders thereof as they appear on the register of the Trust as of the close
of business on the relevant record dates. While the Preferred Securities are
represented by one or more Global Securities, the relevant record dates shall be
the close of business on the Business Day next preceding such Distribution
payment date, unless a different regular record date is established or provided
for the corresponding interest payment date on the Debentures. The relevant
record dates for the Common Securities shall be the same as for the Preferred
Securities. If the Preferred Securities shall not continue to remain represented
by one or more Global Securities, the relevant record dates for the Preferred
Securities shall be selected by the Administrative Trustees and shall be at
least 15 days prior to the relevant payment dates. At all times, the
Distribution payment dates shall correspond to the interest payment dates on the
Debentures. 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, shall 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 with respect to the related interest payment date
pursuant to 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 next preceding day which is a Business Day, with the same
force and effect as if made on such payment date.
(e) 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 among the
Holders of the Securities.
Section 7.3. REDEMPTION OF SECURITIES.
(a) Upon the repayment or redemption, in whole or in
part, of the Debentures held by the Trust, whether at the stated maturity of the
Debentures or upon earlier redemption as provided in the Debentures and the
Indenture, including pursuant to a Special Event, the proceeds from such
repayment or redemption shall be simultaneously applied Pro Rata (subject to
Section 7.1(b)) to redeem Securities having an aggregate liquidation amount
equal to the aggregate principal amount of the Debentures so repaid or redeemed
at the Redemption Price. Holders shall be given not less than 30 nor more than
60 days notice of such redemption in accordance with Section 7.4.
35
(b) Certificates called for redemption in whole must be
surrendered to the Paying Agent in order to receive payment of the Redemption
Price. Upon surrender of a Security that is redeemed in part, the Property
Trustee shall authenticate for the Holder a new Security equal in liquidation
amount to the unredeemed portion of the Security surrendered.
Section 7.4. REDEMPTION PROCEDURES.
(a) At least 30 days but not more than 60 days before a
redemption date, the Trust shall mail a notice of redemption by first-class mail
to each Holder whose Securities are to be redeemed.
The notice shall identify the Securities to be redeemed and
shall state:
(i) the redemption date;
(ii) the redemption price;
(iii) the name and address of the Paying Agent;
(iv) that Securities called for redemption must
be surrendered to the Paying Agent to collect the redemption price;
(v) that Distributions on Securities called for
redemption cease to accrue on and after the redemption date; and
(vi) any other information as may be required by
the terms of the Securities being redeemed.
At the Trust's request, the Property Trustee shall give the
notice of redemption in the Trust's name and at its expense.
(b) If fewer than all the outstanding Securities are to
be so redeemed, the Common Securities and the Preferred Securities will be
redeemed Pro Rata (subject to Section 7.1(b)) and will be redeemed as described
in Section 7.4(c) below. The Trust may not redeem the Securities in part unless
all accumulated and unpaid Distributions to the date of redemption have been
paid in full on all Securities then outstanding. For all purposes of this Trust
Agreement, unless the context otherwise requires, all provisions relating to the
redemption of Preferred Securities shall relate, in the case of any Preferred
Security redeemed or to be redeemed only in part, to the portion of the
aggregate liquidation amount of Preferred Securities which has been or is to be
redeemed.
(c) Once notice of redemption is mailed as provided in
Section 7.4(a), Securities called for redemption become due and payable on the
redemption date and at the redemption price. A notice of redemption may not be
conditional. Upon surrender to the Paying Agent, such Securities shall be paid
at the redemption price plus accumulated Distributions to the redemption date.
36
(d) On or before the redemption date; PROVIDED that the
Debenture Issuer has paid the Property Trustee a sufficient amount of
immediately available funds in connection with the related redemption of the
Debentures, the Property Trustee shall deposit with the Paying Agent money
sufficient to pay the redemption price of and accumulated and unpaid
Distributions, if any, on all Securities to be redeemed on that date.
(e) Subject to the foregoing and applicable law
(including, without limitation, United States federal securities laws), the
Sponsor or its subsidiaries may at any time and from time to time purchase
outstanding Preferred Securities by tender, in the open market or by private
agreement.
Section 7.5. VOTING RIGHTS OF PREFERRED SECURITIES.
(a) Except as provided under Sections 2.6, 6.6, 11.1 and
this Article 7 and as otherwise required by the Business Trust Act, the TIA and
other applicable law, the Holders of the Preferred Securities shall have no
voting rights.
(b) Subject to the requirement of the Property Trustee to
obtain a tax opinion in certain circumstances as set forth in Section 7.5(d)
below, the Holders of a Majority in Liquidation Amount of the Preferred
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee, or
exercising any trust or power conferred on the Property Trustee under the Trust
Agreement, including the right to direct the Property Trustee, as Holder of the
Debentures, to (i) exercise the remedies available to it under the Indenture as
a Holder of the Debentures; (ii) consent to any amendment or modification of the
Indenture or the Debentures where such consent shall be required or (iii) waive
any past default and its consequences that is waivable under Section 6.4 of the
Indenture; PROVIDED, HOWEVER, that if an Indenture Event of Default has occurred
and is continuing, then the Holders of 25% of the aggregate liquidation amount
of the Preferred Securities may direct the Property Trustee to declare the
principal of and accrued and unpaid interest, if any, on the Debentures due and
payable immediately; PROVIDED, FURTHER, that where a consent or action under the
Indenture would require the consent or act of the Holders of more than a
majority of the aggregate principal amount of Debentures affected thereby, only
the Holders of the percentage of the aggregate stated liquidation amount of the
Preferred Securities which is at least equal to the percentage required under
the Indenture may direct the Property Trustee to give such consent to take such
action; PROVIDED, FURTHER, that (subject to the provisions of Section 3.9) the
Property Trustee shall have the right to decline to follow any such direction if
the Property Trustee shall (x) determine that the direction conflicts with any
rule of law, the Trust Agreement or the Indenture; (y) determine that the
Property Trustee may take any other action deemed proper by the Property Trustee
which is not inconsistent with such direction; and (z) in good faith, by a
Responsible Officer of the Property Trustee, determine that the proceeding so
directed would involve the Property Trustee in personal liability.
(c) If the Property Trustee fails to enforce its rights
under the Debentures after a Holder of Preferred Securities has made a written
request, such Holder
37
of Preferred Securities may, to the extent permitted by applicable law,
institute a legal proceeding directly against the Debenture Issuer to enforce
the Property Trustee's rights under the Indenture without first instituting
any legal proceeding against the Property Trustee or any other person. In
addition, if a Trust Enforcement Event has occurred and is continuing and
such event is attributable to the failure of the Debenture Issuer to make any
interest, principal or other required payments when due under the Indenture,
then a Holder of Preferred Securities may directly institute a Direct Action
against the Debenture Issuer on or after the respective due date specified in
the Debentures.
(d) Subject to Section 2.7, the Property Trustee shall
notify all Holders of the Preferred Securities of any notice of any Indenture
Event of Default received from the Debenture Issuer with respect to the
Debentures. Such notices shall state that such Indenture Event of Default also
constitutes a Trust Enforcement Event. Except with respect to directing the
time, method, and place of conducting a proceeding for a remedy, the Property
Trustee shall be under no obligation to take any of the actions described in
clause 7.5(b)(i) and (ii) above unless the Property Trustee has obtained an
opinion of independent tax counsel to the effect that the Trust will not fail to
be classified as a grantor trust for United States federal income tax purposes
as a result of such action, and each Holder will be treated as owning an
undivided beneficial ownership interest in the Debentures.
(e) In the event the consent of the Property Trustee, as
the Holder of the Debentures, is required under the Indenture with respect to
any amendment or modification of the Indenture, the Property Trustee shall
request the direction of the Holders of the Securities with respect to such
amendment or modification and shall vote with respect to such amendment or
modification as directed by not less than 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 the Holders of more
than a majority of the aggregate principal amount of the Debentures, the
Property Trustee may only give such consent at the direction of the Holders of
at least the same proportion in aggregate stated liquidation amount of the
Securities. The Property Trustee shall not take any such action in accordance
with the directions of the Holders of the Securities unless the Property Trustee
has obtained an opinion of independent tax counsel to the effect that the Trust
will not be classified as other than a grantor trust for United States federal
income tax purposes as a result of such action, and each Holder will be treated
as owning an undivided beneficial ownership interest in the Debentures.
(f) A waiver of an Indenture Event of Default with
respect to the Debentures will constitute a waiver of the corresponding Trust
Enforcement Event.
(g) Any required approval or direction of Holders of
Preferred Securities may be given at a separate meeting of Holders of Preferred
Securities convened for such purpose, at a meeting of all of the Holders of
Securities or pursuant to written consent. The Administrative Trustees will
cause a notice of any meeting at which Holders of Preferred Securities are
entitled to vote to be mailed to each Holder of record of Preferred Securities.
Each such notice will include a statement setting forth (i) the date of such
meeting, (ii) a description of any resolution proposed for adoption at such
38
meeting on which such Holders are entitled to vote and (iii) instructions for
the delivery of proxies.
(h) No vote or consent of the Holders of Preferred
Securities shall be required for the Trust to redeem and cancel Preferred
Securities or distribute Debentures in accordance with this Trust Agreement and
the terms of the Securities.
(i) Notwithstanding that Holders of Preferred Securities
are entitled to vote or consent under any of the circumstances described above,
any of the Preferred Securities that are owned at such time by the Debenture
Issuer, any Administrative Trustee or any entity directly or indirectly
controlled by, or under direct or indirect common control with, the Debenture
Issuer or any Administrative Trustee, shall not be entitled to vote or consent
and shall, for purposes of such vote or consent, be treated as if such
Securities were not outstanding; PROVIDED, HOWEVER, that persons otherwise
eligible to vote to whom the Debenture Issuer or any of its subsidiaries have
pledged Preferred Securities may vote or consent with respect to such pledged
Preferred Securities under any of the circumstances described herein.
(j) Subject to Sections 6.6(a) and 7.5(k), Holders of the
Preferred Securities shall have no rights to appoint or remove the Trustees, who
may be appointed, removed or replaced solely by the Common Securities Holders.
(k) Subject to the rights of the Holders of a Majority in
Liquidation Amount of the Common Securities to appoint or remove Administrative
Trustees as provided in Section 6.6(a)(iii), if an Indenture Event of Default
has occurred and is continuing, the Trustees may be removed at such time only by
a Majority in Liquidation Amount of the Preferred Securities.
Section 7.6. VOTING RIGHTS OF COMMON SECURITIES.
(a) Except as provided under Sections 2.6, 6.1(b) or 6.6,
this Section 7.6 or Section 11.1 or as otherwise required by the Business Trust
Act, the TIA or other applicable law, the Holders of the Common Securities will
have no voting rights.
(b) Subject to Sections 6.6(a) and 7.5(k), the Holders of
the Common Securities shall be entitled, in accordance with Article 6 of this
Trust Agreement, to vote to appoint, remove or replace any Trustee or to
increase or decrease the number of Trustees.
(c) Subject to Section 2.6 and only after all Trust
Enforcement Events with respect to the Preferred Securities have been cured,
waived, or otherwise eliminated and subject to the requirement of the Property
Trustee to obtain a tax opinion in certain circumstances as set forth in this
paragraph (c), the Holders of a Majority in Liquidation Amount of the Common
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Property Trustee, or exercising any
trust or power conferred on the Property Trustee under this Trust Agreement,
including the right to direct the Property Trustee, as Holder of the Debentures,
to (i) exercise the remedies available to it under the Indenture as a Holder of
39
the Debentures, (ii) consent to any amendment or modification of the Indenture
or the Debentures where such consent shall be required or (iii) waive any past
default and its consequences that is waivable under Section 6.4 of the
Indenture; PROVIDED, HOWEVER, that where a consent or action under the Indenture
would require the consent or act of the Holders of more than a majority of the
aggregate principal amount of Debentures affected thereby, only the Holders of
the percentage of the aggregate stated liquidation amount of the Common
Securities which is at least equal to the percentage required under the
Indenture may direct the Property Trustee to have such consent or take such
action; PROVIDED, FURTHER, that (subject to the provisions of Section 3.9) the
Property Trustee shall have the right to decline to follow any such direction if
the Property Trustee shall (x) determine that the direction conflicts with any
rule of law, the Trust Agreement or the Indenture; (y) determine that the
Property Trustee may take any other action deemed proper by the Property Trustee
which is not inconsistent with such direction; and (z) in good faith, by a
Responsible Officer of the Property Trustee, determine that the proceeding so
directed would involve the Property Trustee in personal liability. Except with
respect to directing the time, method, and place of conducting a proceeding for
a remedy, the Property Trustee shall be under no obligation to take any of the
actions described in clause 7.6(c)(i) and (ii) above unless the Property Trustee
has obtained an opinion of independent tax counsel to the effect that the Trust
will not fail to be classified as a grantor trust for United States federal
income tax purposes as a result of such action, and each Holder will be treated
as owning an undivided beneficial ownership interest in the Debentures.
(d) If the Property Trustee fails to enforce its rights
under the Debentures after a Holder of Common Securities has made a written
request, such Holder of Common Securities may, to the extent permitted by
applicable law, directly institute a legal proceeding directly against the
Debenture Issuer to enforce the Property Trustee's rights under the Debentures
without first instituting any legal proceeding against the Property Trustee or
any other person.
(e) A waiver of an Indenture Event of Default with
respect to the Debentures will constitute a waiver of the corresponding Trust
Enforcement Event.
(f) Any required approval or direction of Holders of
Common Securities maybe given at a separate meeting of Holders of Common
Securities convened for such purpose, at a meeting of all of the Holders of
Securities or pursuant to written consent. The Administrative Trustees will
cause a notice of any meeting at which Holders of Common Securities are entitled
to vote to be mailed to each Holder of record of Common Securities. Each such
notice will include a statement setting forth (i) the date of such meeting, (ii)
a description of any resolution proposed for adoption at such meeting on which
such Holders are entitled to vote and (iii) instructions for the delivery of
proxies.
(g) 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 Debentures in accordance with the Trust Agreement and the terms
of the Securities.
40
Section 7.7. REGISTRAR AND PAYING AGENT. The Trust shall cause
a Paying Agent to maintain an office or agency where the Securities may be
presented or surrendered for payment, maintain an office or agency where
Securities may be surrendered for registration of transfer or exchange
("Registrar") and where notices and demands to or upon the Trust in respect of
the Securities and this Trust Agreement may be served ("Service Agent"). The
Registrar shall keep a register with respect to the Securities and to their
transfer and exchange. The Trust will give prompt written notice to the Property
Trustee of the name and address, and any change in the name or address, of each
Registrar, Paying Agent or Service Agent. If at any time the Trust shall fail to
maintain any such required Registrar, Paying Agent or Service Agent or shall
fail to furnish the Property Trustee with the name and address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Property Trustee, and the Trust hereby appoints
the Property Trustee as its agent to receive all such presentations, surrenders,
notices and demands.
The Trust may also from time to time designate one or more
co-registrars, additional paying agents or additional service agents and may
from time to time rescind such designations; PROVIDED, HOWEVER, that no such
designation or rescission shall in any manner relieve the Trust of its
obligations to maintain a Registrar, Paying Agent and Service Agent for such
purposes. The Trust will give prompt written notice to the Property Trustee of
any such designation or rescission and of any change in the name or address of
any such co-registrar, additional paying agent or additional service agent. The
term "Registrar" includes any co-registrar; the term "Paying Agent" includes any
additional paying agent; and the term "Service Agent" includes any additional
service agent.
The Trust hereby appoints the Property Trustee the initial
Registrar, Paying Agent and Service Agent for the Securities.
Section 7.8. LISTING. The Sponsor shall use its best efforts
to cause the Preferred Securities to be listed for quotation on the New York
Stock Exchange.
Section 7.9. TRANSFER AND EXCHANGE OF SECURITIES.
(a) Securities may only be transferred, in whole or in
part, in accordance with the terms and conditions set forth in this Trust
Agreement and in the terms of the Securities. To the fullest extent permitted by
law, any transfer or purported transfer of any Security not made in accordance
with this Trust Agreement shall be null and void.
(b) (i) Subject to this Article 7, Preferred
Securities shall be freely transferable.
(ii) Holders of the Common Securities may not
transfer the Common Securities except (A) in compliance with a
consolidation, merger, sale, conveyance or lease of the Sponsor in
compliance with Article V of the Indenture or (B) to the Sponsor or an
Affiliate thereof in compliance with applicable law,
41
including the Securities Act and applicable state securities and blue
sky laws. To the fullest extent permitted by law, any attempted
transfer of the Common Securities other than as set forth in the
immediately preceding sentence shall be null and void.
(c) Where Securities are presented to the Registrar or a
co-registrar with a request to register a transfer or to exchange them for an
equal liquidation amount of Securities, the Registrar shall register the
transfer or make the exchange if its requirements for such transactions are met.
To permit registrations of transfers and exchanges, the Property Trustee shall
authenticate Securities at the Registrar's request. No service charge shall be
made for any registration of transfer or exchange (except as otherwise expressly
permitted herein), but the Trust may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer tax or similar governmental charge
payable upon exchanges pursuant to Section 7.4).
Neither the Trust nor the Registrar shall be required (i) to
issue, register the transfer of, or exchange Securities for the period beginning
at the opening of business fifteen days immediately preceding the mailing of a
notice of redemption of Securities and ending at the close of business on the
day of such mailing, or (ii) to register the transfer of or exchange Securities
selected, called or being called for redemption as a whole or the portion being
redeemed of any such Securities selected, called or being called for redemption
in part.
Section 7.10. MUTILATED, DESTROYED, LOST AND STOLEN
SECURITIES. If any mutilated Security is surrendered to the Property Trustee,
the Administrative Trustees shall execute and the Property Trustee shall
authenticate and deliver in exchange therefor a new Security of like tenor and
liquidation amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Administrative Trustees and
the Property Trustee (i) evidence to their satisfaction of the destruction, loss
or theft of any Security and (ii) such security or indemnity as may be required
by them to save each of them and any agent of either of them harmless, then, in
the absence of notice to the Administrative Trustees or the Property Trustee
that such Security has been acquired by a bona fide purchaser, the
Administrative Trustees shall execute and upon its request the Property Trustee
shall authenticate and make available for delivery, in lieu of any such
destroyed, lost or stolen Security, a new Security of like tenor and liquidation
amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Trust in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Trust may require the payment of a sum sufficient to cover any tax or other
governmental charge
42
that may be imposed in relation thereto and any other expenses (including the
fees and expenses of the Property Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of
any mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Trust, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Trust Agreement equally and proportionately
with any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
Section 7.11. OUTSTANDING SECURITIES. The Securities
outstanding at any time are all the Securities authenticated by the Property
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest on a Global Security effected by the Property
Trustee in accordance with the provisions hereof and those described in this
Section as not outstanding.
If a Security is replaced pursuant to Section 7.10, it ceases
to be outstanding until the Property Trustee receives proof satisfactory to it
that the replaced Security is held by a bona fide purchaser.
If the Paying Agent (other than the Sponsor, a subsidiary or
an Affiliate of any thereof) holds on a redemption date of Securities money
sufficient to pay such Securities payable on that date, then on and after that
date such Securities cease to be outstanding and Distributions on them cease to
accrue.
A Security does not cease to be outstanding because the
Sponsor or an Affiliate holds the Security.
Section 7.12. TREASURY SECURITIES. In determining whether the
Holders of the required liquidation amount of Preferred Securities have
concurred in any request, demand, authorization, direction, notice, consent or
waiver, Preferred Securities owned by the Sponsor or an Affiliate shall be
disregarded, except that for the purposes of determining whether the Property
Trustee shall be protected in relying on any such request, demand,
authorization, direction, notice, consent or waiver only Preferred Securities
that the Property Trustee knows are so owned shall be so disregarded.
Section 7.13. TEMPORARY SECURITIES. Until definitive
Securities are ready for delivery, the Administrative Trustees may prepare and
the Property Trustee shall authenticate temporary Securities upon a Trust Order.
Temporary Securities shall be substantially in the form of definitive Securities
but may have variations that the Administrative Trustees consider appropriate
for temporary Securities. Without unreasonable delay, the Administrative
Trustees shall prepare and the Property Trustee upon request shall authenticate
definitive Securities in exchange for temporary Securities.
43
Until so exchanged, temporary securities shall have the same rights under
this Trust Agreement as the definitive Securities.
Section 7.14. CANCELLATION. The Trust at any time may deliver
Securities to the Property Trustee for cancellation. The Registrar and the
Paying Agent shall forward to the Property Trustee any Securities surrendered to
them for registration of transfer, exchange or payment. The Property Trustee
shall cancel all Securities surrendered for transfer, exchange, payment,
replacement or cancellation and shall destroy such canceled Securities (subject
to the record retention requirement of the Exchange Act) and deliver a
certificate of such destruction to the Trust, unless the Trust otherwise
directs. The Trust may not issue new Securities to replace Securities that it
has paid or delivered to the Property Trustee for cancellation.
Section 7.15. DEEMED SECURITY HOLDERS. The Trustees may treat
the person in whose name any Certificate shall be registered on the register of
the Trust as the sole Holder of such Certificate and of the Securities
represented by such Certificate for purposes of receiving Distributions subject
to Section 7.2(d) 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 shall have actual or other notice thereof.
Section 7.16. GLOBAL SECURITIES.
Section 7.16.1 TERMS OF SECURITIES. A Trust Order shall
establish whether the Preferred Securities shall be issued in whole or in part
in the form of one or more Global Securities and the Depositary for such Global
Security or Securities.
Section 7.16.2 TRANSFER AND EXCHANGE. Notwithstanding any
provisions to the contrary contained in Section 7.9 and in addition thereto, any
Global Security shall be exchangeable pursuant to Section 7.9 for Preferred
Securities registered in the names of Holders other than the Depositary for such
Preferred Security or its nominee only if (i) such Depositary notifies the Trust
that it is unwilling or unable to continue as Depositary for such Global
Security or if at any time such Depositary ceases to be a clearing agency
registered under the Exchange Act, and, in either case, the Trust fails to
appoint a successor Depositary within 90 days of such event, (ii) the Trust
executes and delivers to the Property Trustee an Officers' Certificate to the
effect that such Global Security shall be so exchangeable, or (iii) a Trust
Enforcement Event with respect to the Preferred Securities represented by such
Global Security shall have happened and be continuing. Any Global Security that
is exchangeable pursuant to the preceding sentence shall be exchangeable for
Preferred Securities registered in such names as the Depositary shall direct in
writing in an aggregate liquidation amount equal to the liquidation amount of
the Global Security with like tenor and terms.
Except as provided in this Section 7.16.2, a Global Security
may not be transferred except as a whole by the Depositary with respect to such
Global Security to a nominee of such Depositary, by a nominee of such Depositary
to such Depositary or
44
another nominee of such Depositary or by the Depositary or any such nominee
to a successor Depositary or a nominee of such a successor Depositary.
Section 7.16.3 LEGEND. Any Global Security issued hereunder
shall bear a legend in substantially the following form:
"This Security is a Global Security within the meaning of
the Trust Agreement hereinafter referred to and is registered in the name of
the Depositary or a nominee of the Depositary. This Security is exchangeable
for Preferred Securities registered in the name of a person other than the
Depositary or its nominee only in the limited circumstances described in the
Trust Agreement, and may not be transferred except as a whole by the
Depositary to a nominee of the Depositary, by a nominee of the Depositary to
the Depositary or another nominee of the Depositary or by the Depositary or
any such nominee to a successor Depositary or a nominee of such a successor
Depositary."
Unless this Preferred Security Certificate is presented by an
authorized representative of the Depositary to Disney Capital Trust [I / II /
III] or its agent for registration of transfer, exchange or payment, and any
Preferred Security Certificate issued is registered in the name of Cede & Co. or
such other name as requested by an authorized representative of the Depositary
(and any payment hereon is made to Cede & Co. or to such other entity as is
requested by an authorized representative of the Depositary), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL in as much as the registered owner hereof, Cede & Co., has an interest
herein."
Section 7.16.4 CANCELLATION; ISSUANCE OF REGISTERED
SECURITIES. At such time as all interests in Global Securities have been
redeemed, repurchased or cancelled, such Global Securities shall be, upon
receipt thereof, cancelled by the Property Trustee in accordance with standing
procedures of the Depositary. At any time prior to such cancellation, if any
interest in Global Securities is exchanged for Preferred Securities not
represented by a Global Security, redeemed, cancelled or transferred to a
transferee who receives Preferred Securities not represented by a Global
Security therefor or any Preferred Security not represented by a Global Security
is exchanged or transferred for part of Global Securities, the principal amount
of such Global Securities shall, in accordance with the standing procedures of
the Depositary, be reduced or increased, as the case may be, and an endorsement
shall be made on such Global Securities by the Property Trustee to reflect such
reduction or increase.
The Trust may at any time and in its sole discretion determine
that the Preferred Securities issued in the form of one or more Global
Securities shall no longer be represented by a Global Security. In such event
the Trust shall execute, and the Property Trustee, shall authenticate and
deliver, Preferred Securities in definitive registered form, in any authorized
denominations, in an aggregate liquidation amount equal to the principal amount
of the Global Security representing such Preferred Securities, in exchange for
such Global Security.
45
Section 7.16.5 ACTS OF HOLDERS. The Depositary, as a Holder,
may appoint agents and otherwise authorize participants to give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action which a Holder is entitled to give or take under the Trust Agreement.
Section 7.16.6 PAYMENTS. Notwithstanding the other provisions
of this Trust Agreement, payment of the liquidation amount on any Global
Security shall be made to the Holder thereof.
Section 7.16.7 CONSENTS, DECLARATION AND DIRECTIONS. Except as
provided in Section 7.16.6, the Trust, the Property Trustee and any Agent shall
treat a person as the Holder of such liquidation amount of outstanding Preferred
Securities represented by a Global Security as shall be specified in a written
statement of the Depositary with respect to such Global Security, for purposes
of obtaining any consents, declarations, waivers or directions required to be
given by the Holders pursuant to this Trust Agreement.
Section 7.17. CUSIP NUMBERS. The Trust in issuing the
Securities may use "CUSIP" numbers (if then generally in use), and, if so, the
Property Trustee shall use "CUSIP" numbers in notices of redemption as a
convenience to Holders; PROVIDED that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other elements of identification printed on
the Securities, and any such redemption shall not be affected by any defect in
or omission of such numbers.
Section 7.18. OVER-ALLOTMENT OPTION.
(a) The Sponsor, on behalf of the Trust, may grant to the
underwriters or initial purchasers who are underwriting or purchasing, as the
case may be, any series of Preferred Securities, an option (the "Option") to
purchase an additional liquidation amount of such series of Preferred Securities
on the terms and conditions specified in the underwriting agreement or purchase
agreement, as the case may be, relating to such Preferred Securities; PROVIDED,
HOWEVER, the Option may only be granted if the following conditions are
satisfied:
(i) the Option, if exercised, may not result in
the issue and sale of an aggregate liquidation amount of Preferred
Securities greater than that registered by the Sponsor and the Trust on
the applicable registration statement or registration statements
(including by a registration statement filed under Rule 462(b) under
the Securities Act, if any), as the case may be, with the Commission
under the Securities Act;
(ii) the Option must result, if exercised, in the
issuance and sale of Preferred Securities to such underwriters or
initial purchasers, as the case may be, and the issuance and sale of
Common Securities to the Sponsor on a Pro Rata
46
basis and not in contravention of any other provision of this
Agreement or the Business Trust Act, consistent with Section 5.1; and
(iii) the Preferred Securities and the Common
Securities issued and sold subject to the exercise of the Option, if
any, must be of the same series and must bear the same CUSIP numbers as
the series of Preferred Securities and the Common Securities,
respectively, which were initially issued and sold by the Trust and the
Sponsor, respectively.
(b) With respect to any issuance of Preferred Securities
and Common Securities following the exercise of the Option,
(i) the designation the "__% Preferred
Securities" and, for all purposes under this Trust Agreement, the
defined terms the "Preferred Securities" shall mean both the Preferred
Securities issued initially hereunder and any Preferred Securities
issued pursuant to the exercise of the Option; and
(ii) the designation the "__% Common Securities"
and, for all purposes under this Trust Agreement, the defined term the
"Common Securities" shall mean both the Common Securities issued
initially hereunder and any Common Securities issued pursuant to the
requirement of Section 7.18(a)(ii) regarding the additional issuance of
Common Securities on a Pro Rata basis if the Option is exercised.
(c) If the Option set forth in Section 7.18(a) is
exercised on a date other than the initial Closing Date, then the parties to the
Trust Agreement shall cause there to occur a second closing for the consummation
of the sale of the Preferred Securities and Common Securities under
substantially the same conditions that applied to the initial closing of the
sale of such securities, including the following:
(i) the execution and delivery of a second
Preferred Security Certificate, or such additional Preferred Security
Certificates, as appropriate, which is, or are, as the case may be,
substantially identical in all respects to the Preferred Security
Certificate issued initially; and
(ii) the execution and delivery of a second
Common Security Certificate, or such additional Common Security
Certificates, as appropriate, which is, or are, as the case may be,
substantially identical in all relevant respects to the Common Security
Certificate issued initially.
ARTICLE 8
DISSOLUTION AND TERMINATION OF TRUST
Section 8.1. DISSOLUTION AND TERMINATION OF TRUST.
(a) The Trust shall dissolve upon the earliest of:
47
(i) the Bankruptcy Event of the Holder of the
Common Securities or the Sponsor;
(ii) the filing of a certificate of dissolution
or its equivalent with respect to the Sponsor; after obtaining the
consent of the Holders of at least a Majority in Liquidation Amount of
the Securities to dissolve the Trust; or the revocation of the
Sponsor's charter and the expiration of 90 days after the date of
revocation without a reinstatement thereof;
(iii) the entry of a decree of judicial
dissolution of the Sponsor or the Trust;
(iv) the time when all of the Securities shall
have been called for redemption and the amounts then due shall have
been paid to the Holders in accordance with the terms of the
Securities;
(v) at the Sponsor's election by notice and
direction to the Property Trustee to distribute the Debentures to the
Holders of the Securities in exchange for all of the Securities;
PROVIDED that the Sponsor will be required to obtain an opinion of an
independent counsel that the distribution of the Debentures will not be
taxable to the Holders of the Preferred Securities for United States
federal income tax purposes; or
(vi) the time when the Sponsor shall have
consented to dissolution of the Trust; PROVIDED such action is taken
before the issuance of any Securities.
(b) As soon as is practicable after the occurrence of an
event referred to in Section 8.1(a) and upon completion of the winding up and
liquidation of the Trust, the Trustees shall terminate the Trust by filing a
certificate of cancellation with the Secretary of State of the State of
Delaware.
(c) The provisions of Section 4.2 and Article 9 shall
survive the termination of the Trust.
Section 8.2. LIQUIDATION DISTRIBUTION UPON DISSOLUTION OF THE
TRUST.
(a) In the event of any voluntary or involuntary
liquidation, dissolution, or winding-up of the Trust (each a "Liquidation"), the
Holders of the Securities on the date of the Liquidation will be entitled to
receive, out of the assets of the Trust available for distribution to Holders of
Securities after satisfaction of the Trusts' liabilities to creditors, if any,
distributions in cash or other immediately available funds in an amount equal to
the aggregate of the stated liquidation amount of $________ per Security plus
accumulated and unpaid Distributions thereon to the date of payment (such amount
being the "Liquidation Distribution"), unless, in connection with such
Liquidation, Debentures in an aggregate stated principal amount equal to the
aggregate stated liquidation amount of, with an interest rate identical to the
distribution rate of, and accrued and unpaid interest equal to accumulated and
unpaid Distributions on, such
48
Securities shall be distributed on a Pro Rata basis to the Holders of the
Securities in exchange for such Securities.
(b) 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 the Securities shall be paid on a Pro
Rata basis. The Holders of the Common Securities will be entitled to receive
distributions upon any such Liquidation Pro Rata with the Holders of the
Preferred Securities except that if an Indenture Event of Default has occurred
and is continuing, the Preferred Securities shall have a preference over the
Common Securities with regard to such distributions.
ARTICLE 9
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, DELAWARE TRUSTEES OR OTHERS
Section 9.1. LIABILITY.
(a) Except as expressly set forth in this Trust
Agreement, the Guarantee, the Agreement as to Expenses and Liabilities and the
terms of the Securities, the Sponsor:
(i) shall not be personally liable for the
return of any portion of the capital contributions (or any return
thereon) of the Holders of the Securities which shall be made solely
from assets of the Trust; and
(ii) shall not be required to pay to the Trust or
to any Holder of Securities any deficit upon dissolution of the Trust
or otherwise.
(b) Pursuant to Section 3803(a) of the Business Trust
Act, the Holders of the Common Securities shall be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
(c) Pursuant to Section 3803(a) of the Business Trust
Act, the Holders of the Preferred Securities shall be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
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
49
on such Indemnified Person by this Trust Agreement or by law, except that,
subject to section 3.11, 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 (or
with respect to the Delaware Trustee and its officers, directors,
shareholders or agents, such Indemnified Persons' gross negligence or willful
misconduct).
(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 who has if selected by such
Indemnified Person, been selected by such Indemnified Person with reasonable
care 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 Trust Agreement shall not be liable to the Trust or to
another Covered Person for its good faith reliance on the provisions of this
Trust Agreement. The provisions of this Trust Agreement, to the extent that they
restrict the duties and liabilities of an Indemnified Person otherwise existing
at law or in equity (other than the duties imposed on the Property Trustee under
the TIA), are agreed by the parties hereto to replace such other duties and
liabilities of such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or
arises between any Covered Person and any Indemnified Person; or
(ii) whenever this Trust Agreement or any other
agreement contemplated herein or therein provides that an Indemnified
Person shall act in a manner that is, or provides terms that are, fair
and reasonable to the Trust or any Holder of Securities, the
Indemnified Person shall resolve such conflict of interest, take such
action or provide such terms, considering in each case the relative
interest of each party (including its own interest) to such conflict,
agreement, transaction or situation and the benefits and burdens
relating to such interests, any customary or accepted industry
practices and any applicable generally accepted accounting practices or
principles. In the absence of bad faith by the Indemnified Person, the
resolution, action or term so made, taken or provided by the
Indemnified Person shall not constitute a breach of this Trust
Agreement or any other agreement contemplated herein or of any duty or
obligation of the Indemnified Person at law or in equity or otherwise.
50
(c) Whenever in this Trust Agreement 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 Trust Agreement or by applicable law.
Section 9.4. INDEMNIFICATION.
(a) (i) The Sponsor shall indemnify, to the
full extent permitted by law, any Sponsor 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 a
Sponsor Indemnified Person against expenses (including attorney fees),
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 Sponsor 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.
(ii) The Sponsor shall indemnify, to the full
extent permitted by law, any Sponsor 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 a Sponsor
Indemnified Person against expenses (including attorneys' fees)
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, except that no such indemnification shall be
made in respect of any claim, issue or matter as to which such Sponsor
Indemnified Person shall have been adjudged to be liable to the Trust
unless and only to the extent that the Court of Chancery of Delaware or
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of
all the
51
circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such Court of Chancery or
such other court shall deem proper.
(iii) Any indemnification under paragraphs (i) and
(ii) of this Section 9.4(a) (unless ordered by a court) shall be made
by the Sponsor only as authorized in the specific case upon a
determination that indemnification of the Sponsor Indemnified Person is
proper in the circumstances because he has met the applicable standard
of conduct set forth in paragraphs (i) and (ii). Such determination
shall be made (1) by the Administrative Trustees by a majority vote of
a quorum consisting of such Administrative Trustees who were not
parties to such action, suit or proceeding, (2) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested
Administrative Trustees so directs, by independent legal counsel in a
written opinion, or (3) by the Holders of the Common Securities of the
Trust.
(iv) Expenses (including attorneys' fees)
incurred by a Sponsor Indemnified Person in defending a civil,
criminal, administrative or investigative action, suit or proceeding
referred to in paragraphs (i) and (ii) of this Section 9.4(a) shall be
paid by the Sponsor in advance of the final disposition of such action,
suit or proceeding upon receipt of an undertaking by or on behalf of
such Sponsor 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(a). Notwithstanding the
foregoing, no advance shall be made by the Sponsor if a determination
is reasonably and promptly made (i) by the Administrative Trustees by a
majority vote of a quorum of disinterested Administrative Trustees,
(ii) if such a quorum is not obtainable, or, even if obtainable, if a
quorum of disinterested Administrative Trustees so directs, by
independent legal counsel in a written opinion or (iii) the Common
Security Holder of the Trust, that, based upon the facts known to the
Administrative Trustees, counsel or the Common Security Holder at the
time such determination is made, such Sponsor 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 Sponsor 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 Administrative
Trustees, independent legal counsel or Common Security Holder
reasonably determine that such person deliberately breached his duty to
the Trust or its Common or Preferred Security Holders.
(v) The indemnification and advancement of
expenses provided by, or granted pursuant to, the other paragraphs of
this Section 9.4(a) 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 Preferred 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
52
indemnification under this Section 9.4(a) shall be deemed to be
provided by a contract between the Sponsor and each Sponsor Indemnified
Person who serves in such capacity at any time while this Section
9.4(a) is in effect. Any repeal or modification of this Section 9.4(a)
shall not affect any rights or obligations then existing.
(vi) The Sponsor or the Trust may purchase and
maintain insurance on behalf of any person who is or was a Sponsor
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(a).
(vii) For purposes of this Section 9.4(a),
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(a) with respect to the resulting or
surviving entity as he would have with respect to such constituent
entity if its separate existence had continued.
(viii) The indemnification and advancement of
expenses provided by, or granted pursuant to, this Section 9.4(a)
shall, unless otherwise provided when authorized or ratified, continue
as to a person who has ceased to be a Sponsor Indemnified Person and
shall inure to the benefit of the heirs, executors and administrators
of such a person. The obligation to indemnify as set forth in this
Section 9.4(a) shall survive the resignation or removal of the Delaware
Trustee or the Property Trustee or the termination of this Trust
Agreement.
(b) The Sponsor agrees to indemnify the (i) Property
Trustee, (ii) the Delaware Trustee and (iii) any officers, directors, employees,
shareholders or agents of the Property Trustee or the Delaware Trustee (each of
the Persons in (i) through (iii) being referred to as a "Fiduciary Indemnified
Person") for, and to hold each Fiduciary Indemnified Person harmless against,
any loss, liability or expense incurred without negligence or willful misconduct
on its part (or without gross negligence or willful misconduct on the part of
the Delaware Trustee or its officers, directors, employees, shareholders or
agents), 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 9.4(b) shall survive the resignation and removal of the Delaware Trustee
or the Property Trustee and the dissolution of the Trust and the termination of
this Trust Agreement. In addition, the Sponsor has agreed in the Indenture to
pay the fees and expenses of the Delaware Trustee and the Property Trustee.
53
Section 9.5. OUTSIDE BUSINESSES. Subject to the provisions of
Section 6.3, any Covered Person, the Sponsor, the Delaware Trustee and the
Property 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 activities of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Trust Agreement in and to such
independent ventures or the income or profits derived therefrom, and the pursuit
of any such venture, even if competitive with the activities of the Trust, shall
not be deemed wrongful or improper. No Covered Person, the Sponsor, the Delaware
Trustee or the Property Trustee shall be obligated to present any particular
investment or other opportunity to the Trust even if such opportunity is of a
character that, if presented to the Trust, could be taken by the Trust, and any
Covered Person, the Sponsor, the Delaware Trustee and the Property Trustee shall
have the right to take for its own account (individually or as a partner or
fiduciary) or to recommend to others any such particular investment or other
opportunity. Any Covered Person, the Delaware Trustee and the Property 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.
ARTICLE 10
ACCOUNTING
Section 10.1. FISCAL YEAR. The fiscal year ("Fiscal Year") of
the Trust shall be the fiscal year of the Sponsor, 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
Administrative Trustees shall keep, or cause to be kept, full books of account,
records and supporting documents, which shall reflect in reasonable detail, each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting
principles, consistently applied. The Trust shall use the accrual method of
accounting for United States federal income tax purposes. 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 Administrative Trustees.
(b) The Administrative Trustees shall cause to be
prepared 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 such Fiscal
Year, and the related statements of income or loss.
(c) The Administrative Trustees shall cause to be duly
prepared and delivered to each of the Holders of Securities, an 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
54
Regulations. Notwithstanding any right under the Code to deliver any such
statement at a later date, the Administrative Trustees shall endeavor to
deliver all such statements within 30 days after the end of each Fiscal Year
of the Trust.
(d) The Administrative Trustees shall cause to be duly
prepared and filed with the appropriate taxing authority, 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 Administrative Trustees on behalf of the Trust with
any state or local taxing authority.
Section 10.3. BANKING. The Trust shall maintain 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
Property 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 shall be designated by the Administrative
Trustees; PROVIDED, HOWEVER, that the Property Trustee shall designate the
signatories for the Property Account.
Section 10.4. WITHHOLDING. The Trust and the Administrative
Trustees shall comply with all withholding requirements under United States
federal, state and local law. The Trust shall request, and the Holders shall
provide to the Trust, such forms or certificates as are necessary to establish
an exemption from withholding with respect to each Holder, and any
representations and forms as shall reasonably be requested by the Trust to
assist it in determining the extent of, and in fulfilling, its withholding
obligations. The Administrative Trustees 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 Trust 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
claim that amounts have been withheld in excess of the amounts required by the
applicable jurisdictions, 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 Trust may reduce subsequent Distributions by
the amount of such withholding.
ARTICLE 11
AMENDMENTS AND MEETINGS
Section 11.1. AMENDMENTS.
(a) Except as otherwise provided in this Trust Agreement
or by any applicable terms of the Securities, this Trust Agreement may only be
amended by a written instrument approved and executed by the Sponsor and (i) the
Administrative Trustees (or, if there are more than two Administrative Trustees,
a majority of the Administrative Trustees), (ii) the Property Trustee; and (iii)
the Delaware Trustee if the
55
amendment affects the rights, powers, duties, obligations or immunities of
the Delaware Trustee.
(b) No amendment shall be made, and any such purported
amendment shall be void and ineffective:
(i) unless, the Property 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 Trust Agreement (including the
terms of the Securities) and that all conditions precedent to
the execution and delivery of such amendment have been
satisfied; 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 Trust Agreement
(including the terms of the Securities) and that all
conditions precedent to the execution and delivery of such
amendment have been satisfied; and
(ii) to the extent the result of such amendment
would be to:
a. cause the Trust to be classified other
than as a grantor trust for United States federal income tax
purposes;
b. reduce or otherwise adversely affect the
powers of the Property Trustee in contravention of the TIA; or
c. cause the Trust to be deemed to be an
Investment Company required to be registered under the 1940
Act.
(c) If the Trust has issued any Securities that remain
outstanding:
(i) any amendment that would (a) change the
amount or timing of any distribution of 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 (b) restrict the
right of a Holder of Securities to institute suit for the enforcement
of any such payment on or after such date, will entitle the Holders of
such Securities, voting together as a single class, to vote on such
amendment or proposal and such amendment or proposal shall not be
effective except with the approval of each of the Holders of the
Securities affected thereby; and
(ii) any amendment that would (a) adversely
affect the powers, preferences or special rights of the Securities,
whether by way of amendment to this Trust Agreement or otherwise or (b)
result in the dissolution, winding-up or termination of the Trust other
than pursuant to the terms of this Trust Agreement, will entitle the
holders of the Securities voting together as a single class to vote on
such amendment or proposal and such amendment or proposal shall not be
56
effective except with the approval of a Majority in Liquidation Amount
of the Securities affected thereby; PROVIDED that, if any amendment or
proposal referred to in clause (a) above would adversely affect only
the Preferred Securities or the Common Securities, then only the
affected class will be entitled to vote on such amendment or proposal.
(d) This Section 11.1 shall not be amended without the
consent of all of the Holders of the Securities.
(e) Article 4 shall not be amended without the consent of
the Holders of a Majority in Liquidation Amount of the Common Securities.
(f) The rights of the Holders of the Common Securities
under Article 6 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 Common Securities.
57
(g) Notwithstanding Section 11.1(c), this Trust Agreement
may be amended without the consent of the Holders of the Securities, if such
amendment does not adversely affect in any material respect the rights of the
holders of the Securities, to:
(i) cure any ambiguity, defect or inconsistency;
(ii) add to the covenants, restrictions or
obligations of the Sponsor;
(iii) to conform to any change in Rule 3a-5 of the
1940 Act or written change in interpretation or application of Rule
3a-5 of the 1940 Act by any legislative body, court, government agency
or regulatory authority; or
(iv) to modify, eliminate and add to any
provision of this Trust Agreement to ensure that the Trust will be
classified as a grantor trust for United States federal income tax
purposes at all times that any Securities are outstanding or to ensure
that the Trust will not be required to register as an Investment
Company under the 1940 Act.
(h) Neither the Property Trustee nor the Delaware Trustee
shall be required to sign any amendment that affects its rights,
duties, obligations or immunities under this Trust Agreement or
otherwise.
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 Administrative Trustees (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 Trust
Agreement, the terms of the Securities or the rules of any stock exchange on
which the Preferred Securities are listed or admitted for trading. The
Administrative Trustees 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
Administrative Trustees one or more calls in a writing stating that the signing
Holders of Securities wish to call a meeting and indicating the general or
specific purpose for which the meeting is to be called. Any Holders of
Securities calling a meeting shall specify in writing the Certificates held by
the Holders of Securities exercising the right to call a meeting and only those
Securities specified 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 Securities:
(i) notice of any such meeting shall be given to
all the Holders of 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 Securities is
permitted or required under this Trust Agreement or the rules of any
stock exchange on which the Preferred Securities are listed or
58
admitted for trading, such vote, consent or approval may be given at
a meeting of the Holders of Securities. Any action that may be taken
at a meeting of the Holders of Securities may be taken without a
meeting and without prior notice if a consent in writing setting
forth the action so taken is signed by the Holders of 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 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 Securities
entitled to vote who have not consented in writing. The
Administrative Trustees may specify that any written ballot
submitted to the Security Holders for the purpose of taking any
action without a meeting shall be returned to the Trust within the
time specified by the Administrative Trustees;
(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 Securities executing such proxy. Except as
otherwise provided herein, all matters relating to the giving, voting
or validity of proxies shall be governed by the General Corporation Law
of the State of Delaware relating to proxies, and judicial
interpretations thereunder, as if the Trust were a Delaware corporation
and the Holders of the Securities were stockholders of a Delaware
corporation;
(iii) each meeting of the Holders of the
Securities shall be conducted by the Administrative Trustees or by such
other person that the Administrative Trustees may designate; and
(iv) unless the Business Trust Act, this Trust
Agreement, the terms of the Securities, the TIA or the listing rules of
any stock exchange on which the Preferred Securities are then listed
for trading, otherwise provides, the Administrative Trustees, 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 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.
59
ARTICLE 12
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
Section 12.1. REPRESENTATIONS AND WARRANTIES OF THE PROPERTY
TRUSTEE. The Trustee that acts as initial Property Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Trust Agreement,
and each successor Property Trustee represents and warrants to the Trust and the
Sponsor at the time of the successor Property Trustee's acceptance of its
appointment as Property Trustee that:
(a) the Property Trustee is a banking corporation,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, with trust power and authority to execute and
deliver, and to carry out and perform its obligations under the terms of, this
Trust Agreement;
(b) the Property Trustee satisfies the requirements set
forth in Section 6.3;
(c) the execution, delivery and performance by the
Property Trustee of this Trust Agreement has been duly authorized by all
necessary corporate action on the part of the Property Trustee. This Trust
Agreement has been duly executed and delivered by the Property Trustee, and it
constitutes a legal, valid and binding obligation of the Property Trustee,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, reorganization, moratorium, insolvency and other similar laws
affecting creditors' rights generally and to general principles of equity and
the discretion of the court (regardless of whether the enforcement of such
remedies is considered in a proceeding in equity or at law);
(d) the execution, delivery and performance of this Trust
Agreement by the Property Trustee does not conflict with or constitute a breach
of the articles of association or incorporation, as the case may be, or the
by-laws (or other similar organizational documents) of the Property Trustee; and
(e) no consent, approval or authorization of, or
registration with or notice to, any State (which term, in the case of the
initial Property Trustee, shall mean the State of California) or federal banking
authority having jurisdiction over the trust powers of the Property Trustee is
required for the execution, delivery or performance by the Property Trustee of
this Trust Agreement.
Section 12.2. REPRESENTATIONS AND WARRANTIES OF THE DELAWARE
TRUSTEE. The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Trust Agreement,
and each successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
60
(a) the Delaware Trustee satisfies the requirements set
forth in Section 6.2, satisfies Trust Section 3807 of the Business Trust Act and
has the power and authority to execute and deliver, and to carry out and perform
its obligations under the terms of, this Trust Agreement and, if it is not a
natural person, is duly organized, validly existing and in good standing under
the laws of its jurisdiction of incorporation or organization;
(b) the Delaware Trustee has been authorized to perform
its obligations under the Certificate of Trust and this Trust Agreement. This
Trust Agreement under Delaware law constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law); and
(c) no consent, approval or authorization of, or
registration with or notice to, the State of Delaware or federal banking
authority is required for the execution, delivery or performance by the Delaware
Trustee of this Trust Agreement.
ARTICLE 13
MISCELLANEOUS
Section 13.1. NOTICES. Any notice or communication is duly
given if in writing and delivered in person or mailed by first-class mail:
(a) if to the Trust, in care of the Administrative
Trustees:
c/o The ▇▇▇▇ Disney Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: _________________________
(b) if to the Property Trustee:
▇▇▇▇▇ Fargo Bank, National Association
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
61
(c) if to the Delaware Trustee:
Wilmington Trust Company
▇▇▇▇▇▇ Square North
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
(d) if to the Holder of the Common Securities:
The ▇▇▇▇ Disney Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:_______________________________
Notice may be given to designate additional or different
addresses for subsequent notices or communications.
Any notice or communication to a Holder of Preferred
Securities shall be mailed by first-class mail to his address shown on the
register kept by the Registrar. Failure to mail a notice or communication to a
Holder of Preferred Securities or any defect in it shall not affect its
sufficiency with respect to other Holders of Preferred Securities.
If a notice or communication is mailed or published in the
manner provided above, within the time prescribed, it is duly given, whether or
not the Holder of Preferred Securities receives it.
If the Trust mails a notice or communication to Holders of
Securities, it shall mail a copy to the Property Trustee and each Agent at the
same time.
Section 13.2. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Holders of Securities may communicate pursuant to Section 312(b) of the TIA with
other Holders of Securities with respect to their rights under this Trust
Agreement or the Securities. The Trust, the Property Trustee, the Delaware
Trustee, the Registrar and anyone else shall have the protection of Section
312(c) of the TIA.
Section 13.3. CERTIFICATE AND OPINION AS TO CONDITIONS
PRECEDENT. Upon any request or application by the Trust to the Property Trustee
to take any action under this Trust Agreement, the Administrative Trustees shall
furnish to the Property Trustee:
(a) an Officers' Certificate stating that, in the opinion
of the signers, all conditions precedent, if any, provided for in this Trust
Agreement relating to the proposed action have been complied with; and
(b) an Opinion of Counsel stating that, in the opinion of
such counsel, all such conditions precedent have been complied with.
62
Section 13.4. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or Opinion of Counsel with respect to compliance with a
condition or covenant provided for in this Trust Agreement (other than a
certificate provided pursuant to Section 314(a)(4) of the TIA) shall comply with
the provisions of Section 314(e) of the TIA and shall include:
(a) a statement that the person signing such Officers'
Certificate or Opinion of Counsel has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such Officers' Certificate or Opinion of Counsel are based;
(c) a statement that, in the opinion of such person, he
has made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(d) a statement as to whether or not, in the opinion of
such person, such condition or covenant has been complied with.
Section 13.5. RULES BY TRUSTEE AND AGENTS. The Trustee may
make reasonable rules for action by or a meeting of Holders of Securities. Any
Agent may make reasonable rules and set reasonable requirements for its
functions.
Section 13.6. LEGAL HOLIDAYS. Unless otherwise provided by
Officers' Certificate, a "Legal Holiday" is any day that is not a Business Day.
If a payment date is a Legal Holiday at a place of payment, payment may be made
at that place on the next succeeding day that is not a Legal Holiday, and no
Distributions shall accrue for the intervening period.
Section 13.7. NO RECOURSE AGAINST OTHERS. A director, officer,
employee or stockholder, as such, of the Debenture Issuer shall not have any
liability for any obligations of the Debenture Issuer under the Securities, the
Trust Agreement, the Debentures or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. Each Holder of
Securities by accepting a Security waives and releases all such liability.
The waiver and release are part of the consideration for the
issue of the Securities.
Section 13.8. 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 Trust Agreement shall be
interpreted in a manner consistent with such classification.
Section 13.9. COUNTERPARTS. This Trust Agreement may be
executed in any number of counterparts and by the parties hereto in separate
counterparts, each of
63
which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
Section 13.10. GOVERNING LAWS. THIS TRUST AGREEMENT SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO AGREEMENTS MADE AND
TO BE PERFORMED IN SUCH STATE, WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS
THEREOF; PROVIDED THAT THE IMMUNITIES AND STANDARD OF CARE OF THE PROPERTY
TRUSTEE IN CONNECTION WITH THE ADMINISTRATION OF ITS TRUSTS HEREUNDER SHALL BE
GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE JURISDICTION OF
ITS INCORPORATION.
Section 13.11. SUCCESSORS. All agreements of the Trust in this
Trust Agreement and the Securities shall bind its successor. All agreements of
the Trustees in this Trust Agreement shall bind their respective successors.
Section 13.12. SEVERABILITY. In case any provision in this
Trust Agreement or in the Securities shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
Section 13.13. TABLE OF CONTENTS, HEADINGS, ETC. The Table of
Contents, Cross-Reference Table, and headings of the Articles and Sections of
this Trust Agreement have been inserted for convenience of reference only, are
not to be considered a part hereof, and shall in no way modify or restrict any
of the terms or provisions hereof.
[THE REST OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY; THE SIGNATURE PAGE
FOLLOWS.]
64
IN WITNESS WHEREOF, the undersigned have caused these presents
to be executed as of the day and year first above written.
THE ▇▇▇▇ DISNEY COMPANY,
as Sponsor
By:
----------------------------------
Name:
Title:
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
as Property Trustee
By:
-----------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as Delaware Trustee
By:
-----------------------------------
Name:
Title:
[NAME OF ADMINISTRATIVE TRUSTEE],
as Administrative Trustee
-----------------------------------
[NAME OF ADMINISTRATIVE TRUSTEE],
as Administrative Trustee
-----------------------------------
[NAME OF ADMINISTRATIVE TRUSTEE],
as Administrative Trustee
-----------------------------------
65
EXHIBIT A
[IF THE SECURITY IS TO BE A GLOBAL SECURITY, INSERT THE FOLLOWING:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
TRUST AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITARY OR A NOMINEE OF THE DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR
PREFERRED SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
TRUST AGREEMENT, AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY
TO A NOMINEE OF THE DEPOSITARY, BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO
A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH A SUCCESSOR DEPOSITARY.
UNLESS THIS PREFERRED SECURITY CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY TO THE PREFERRED SECURITY ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY PREFERRED
SECURITY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND
ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
A-1
CERTIFICATE NO.__________ NUMBER OF PREFERRED SECURITIES:___________
CUSIP NO.________________
CERTIFICATE EVIDENCING __% PREFERRED SECURITIES
OF
DISNEY CAPITAL TRUST [I / II / III]
% PREFERRED SECURITIES
(LIQUIDATION AMOUNT $__ PER PREFERRED SECURITY)
FULLY AND UNCONDITIONALLY
GUARANTEED BY THE ▇▇▇▇ DISNEY COMPANY
DISNEY CAPITAL TRUST [I / II / III], a statutory business
trust created under the laws of the State of Delaware (the "Trust"), hereby
certifies that ________ (the "Holder") is the registered owner of ________
preferred securities of the Trust representing undivided beneficial ownership
interests in the assets of the Trust designated the "__% Preferred Security"
(liquidation amount $__ per Preferred Security) (the "Preferred Securities").
The Preferred Securities are transferable on the register of the Trust, in
person or by a duly authorized attorney, upon surrender of this certificate duly
endorsed and in proper form for transfer as provided in the Trust Agreement (as
defined below). The designation, rights, privileges, restrictions, preferences
and other terms and provisions of the Preferred Securities represented hereby
are issued and shall in all respects be subject to the provisions of the Amended
and Restated Trust Agreement of the Trust, dated as of ________ __, 200_, as the
same may be amended from time to time (the "Trust Agreement"), by and among THE
▇▇▇▇ DISNEY COMPANY, ________, ________ and ________, as Administrative
Trustees, ________, as Property Trustee, ________, as Delaware Trustee and the
Holders. Capitalized terms used herein but not defined shall have the meaning
given them in the Trust Agreement. The Holder is entitled to the benefits of the
Guarantee to the extent described therein. The Sponsor will provide a copy of
the Trust Agreement, the Guarantee and the Indenture to a Holder without charge
upon written request to the Sponsor at its principal place of business. Upon
receipt of this certificate, the Holder is bound by the Trust Agreement and is
entitled to the benefits thereunder. By acceptance, the Holder agrees to treat,
for United States federal income tax purposes, the Debentures as indebtedness
and the Preferred Securities as evidence of undivided indirect beneficial
ownership interests in the Debentures.
A-2
IN WITNESS WHEREOF, the Trust has executed this certificate
this ___ day of ________, 200_.
DISNEY CAPITAL TRUST [I / II / III]
By:
-------------------------------------
Name:
Title: Administrative Trustee
This is one of the Preferred Securities referred to in the within-mentioned
Trust Agreement.
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
as Property Trustee
By:
-----------------------------------
Name:
Authorized Officer
A-3
[FORM OF ASSIGNMENT]
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
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 Preferred 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 Preferred
Security Certificate)
A-4
EXHIBIT B
TRANSFER OF THIS CERTIFICATE IS SUBJECT TO THE
CONDITIONS SET FORTH IN THE TRUST AGREEMENT
REFERRED TO BELOW.
CERTIFICATE NO.__________ NUMBER OF COMMON SECURITIES:___________
CUSIP NO.________________
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
DISNEY CAPITAL TRUST [I / II / III]
% COMMON SECURITIES
(LIQUIDATION AMOUNT $__ PER COMMON SECURITY)
DISNEY CAPITAL TRUST [I / II / III], a statutory business
trust created under the laws of the State of Delaware (the "Trust"), hereby
certifies that THE ▇▇▇▇ DISNEY COMPANY (the "Holder") is the registered owner of
common securities of the Trust representing an undivided beneficial ownership
interest in the assets of the Trust designated the "__% Common Securities"
(liquidation amount $________ per Common Security) (the "Common Securities").
The Common Securities are not transferable and any attempted transfer thereof
shall be void except as permitted by applicable law and by Section 7.9 of the
Trust Agreement (as defined below). The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Common
Securities represented hereby are issued and shall in all respects be subject to
the provisions of the Amended and Restated Trust Agreement of the Trust, dated
as of ________ __, 200_ (as the same may be amended from time to time, the
"Trust Agreement"), by and among THE ▇▇▇▇ DISNEY COMPANY, as Sponsor, ________,
________, and ________, as Administrative Trustees, ________, as Property
Trustee, ________, as Delaware Trustee and the Holders. The Holder is entitled
to the benefits of the Guarantee to the extent described therein. Capitalized
terms used herein but not defined shall have the meaning given them in the Trust
Agreement. The Sponsor will provide a copy of the Trust Agreement, the Guarantee
and the Indenture to the Holder without charge upon written request to the
Sponsor at its principal place of business. Upon receipt of this certificate,
the Holder is bound by the Trust Agreement and is entitled to the benefits
thereunder. By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Common Securities as
evidence of an undivided indirect beneficial ownership interest in the
Debentures.
B-1
IN WITNESS WHEREOF, the Trust has executed this certificate
this ___ day of ________, 200_.
DISNEY CAPITAL TRUST [I / II / III]
By:
------------------------------------
Name:
Title: Administrative Trustee
This is one of the Common Securities referred to in the within-mentioned Trust
Agreement.
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
as Property Trustee
By:
-------------------------------------
Name:
Authorized Officer
B-2
[FORM OF ASSIGNMENT]
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common
Security Certificate to:
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
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:
-----------------------
Signature:
---------------------------
(Sign exactly as your name appears on the other side of this Common
Security Certificate)
B-3