EXHIBIT 4.12
CUSTODIAL AGREEMENT
THIS CUSTODIAL AGREEMENT (this "CUSTODIAL AGREEMENT") is
entered into as of March 5, 2004, among Bankers Trust Company, N.A., a
national banking association, acting as custodian (the "CUSTODIAN"), Citibank,
N.A. in its capacity as indenture trustee (the "INDENTURE TRUSTEE") for the
holders of the notes (the "NOTES") to be issued by each trust (each a "TRUST")
organized in connection with the Principal Life Insurance Company Secured Notes
Program (the "PROGRAM"), and U.S. Bank Trust National Association, as trustee
(the "TRUSTEE") on behalf of each Trust organized in connection with the
Program.
WHEREAS, in connection with the issuance and sale of the Notes
by each Trust, the Trustee, on behalf of each Trust, will purchase from
Principal Life Insurance Company ("PRINCIPAL LIFE") a funding agreement (a
"FUNDING AGREEMENT"), the payment obligations of which are fully and
unconditionally guaranteed by Principal Financial Group, Inc. ("PFG") pursuant
to a guarantee issued to such Trust (the "GUARANTEE");
WHEREAS, the parties desire that each Funding Agreement and
Guarantee be held in the State of Iowa at all times prior to the occurrence and
continuance of an Event of Default (as defined in each such Funding Agreement)
or a breach of PFG's obligations under the terms of the Guarantee;
WHEREAS, the parties desire that the Custodian be appointed as
custodian for the Indenture Trustee, to hold in safe custody for the benefit of
the Indenture Trustee, on the terms and conditions provided in this Custodial
Agreement, each Funding Agreement and Guarantee; and
WHEREAS, the Custodian has the power and ability sufficient to
undertake and to discharge the duties accepted by it under this Custodial
Agreement;
NOW, THEREFORE, in consideration of the foregoing premises and
the covenants contained herein, and for other good and valuable consideration,
the receipt of which are hereby acknowledged, the parties hereto covenant and
agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1. Incorporation of Definitions by Reference. All
capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to such terms in the Standard Indenture Terms filed as an exhibit to
the registration statement concerning the Program.
ARTICLE 2
APPOINTMENT OF CUSTODIAN
SECTION 2.1. Appointment of Custodian. The Indenture Trustee
hereby appoints the Custodian and the Custodian hereby acknowledges that it will
act as custodian for the Indenture Trustee with respect to each Funding
Agreement and Guarantee that is
1
collaterally assigned to the Indenture Trustee pursuant to the Indenture and
with respect to each Funding Agreement and each Guarantee in which a security
interest is granted to the Indenture Trustee pursuant to the Indenture, and that
comes into the physical custody or possession of the Custodian under this
Custodial Agreement, until the earlier of (a) such time when the Indenture
Trustee notifies the Custodian in writing to the contrary, whereupon such
physical custody and possession of each Funding Agreement and Guarantee
specified in such notice will be transferred to the Indenture Trustee or another
Person in the manner directed by the Indenture Trustee or (b) the termination of
this Custodial Agreement. Acceptance by the Custodian of this appointment is
conclusively evidenced by its execution of this Custodial Agreement.
SECTION 2.2. Custodian Not Subject to Direction of Any Trust.
In no event shall the Custodian, in such custodial role, be construed to be
subject to the direction of the Trustee, on behalf of any Trust, or deliver any
such Funding Agreement or Guarantee to the Trustee, on behalf of any Trust,
without the express written consent of the Indenture Trustee.
ARTICLE 3
DELIVERY OF FUNDING AGREEMENTS AND GUARANTEES
SECTION 3.1. Delivery of Funding Agreements and Guarantees.
The Indenture Trustee shall, for safekeeping, deposit each Funding Agreement and
Guarantee with and deliver each Funding Agreement and Guarantee into, or cause
each Funding Agreement and Guarantee to be deposited with and delivered into,
the actual, exclusive and continuous possession and control of the Custodian as
custodian for the Indenture Trustee.
SECTION 3.2. Limited Interest of Each Trust. Each Trust shall
retain and reserve only such interests, claims or rights in the Funding
Agreements and Guarantees as are set forth herein, in the Indenture or other
such documents as are used (i) to effect the applicable Trust's collateral
assignment of the applicable Funding Agreement and applicable Guarantee to the
Indenture Trustee and to record Principal Life's acknowledgement thereof and
(ii) to grant a security interest in the applicable Funding Agreement and
applicable Guarantee to the Indenture Trustee and to record PFG's and Principal
Life's, respectively, acknowledgement thereof.
SECTION 3.3. Security Interest of Indenture Trustee. Delivery
of any Funding Agreement or Guarantee to the Custodian shall, without any
further act or condition, constitute conclusive evidence against the applicable
Trust and all third parties of the Indenture Trustee's security interest
therein.
SECTION 3.4. Indenture Trustee Covenant to Abide by Custodial
Agreement. The Indenture Trustee hereby covenants that, at all times prior to an
Event of Default or a breach of PFG's obligations under a Guarantee and so long
as it retains a security interest or other ownership interest in a Funding
Agreement or Guarantee, it will take no action to terminate or to cause the
termination of this Custodial Agreement, and it will abide by the requirement
herein that the physical custody and possession of each such Funding Agreement
and each such Guarantee be at
2
the location provided in Section 9.5 or at such other location within the State
of Iowa designated by the Custodian.
ARTICLE 4
INSPECTION OF FUNDING AGREEMENTS, GUARANTEES, BOOKS AND RECORDS
SECTION 4.1. Inspection of Funding Agreements and Guarantees.
So long as any Notes are Outstanding, the Indenture Trustee and the Trustee, on
behalf of the applicable Trust, by or through their attorneys, agents or
employees, shall each be entitled, but shall be under no obligation, at any
mutually agreeable time, during normal business hours, at the expense of the
applicable Trust, upon two Business Days' notice to the Custodian, to examine
and audit each Funding Agreement and Guarantee held by the Custodian.
SECTION 4.2. Inspection of Books and Records. The Custodian
shall maintain appropriate books and records relating to services performed by
it with respect to each Funding Agreement and Guarantee and, so long as any
Notes are Outstanding, the Indenture Trustee and the Trustee, on behalf of the
applicable Trust, by or through their attorneys, agents or employees, shall each
be entitled, but shall be under no obligation, at any mutually agreeable time,
during normal business hours, at the expense of the applicable Trust, upon two
Business Days' notice to the Custodian, to examine such books and records.
ARTICLE 5
DUTIES OF CUSTODIAN
SECTION 5.1. General. The Custodian shall:
(a) on behalf of the Indenture Trustee, accept and hold each
Funding Agreement and Guarantee in the State of Iowa at its
address indicated in Section 9.5 as custodian for the
Indenture Trustee, subject to the provisions of this Custodial
Agreement, the Indenture and each such Funding Agreement and
Guarantee;
(b) have and maintain open, continuous and exclusive possession,
dominion and control over each Funding Agreement and Guarantee
delivered to it under this Custodial Agreement, subject only
to the rights and interest of the Indenture Trustee and the
applicable Trust;
(c) from time to time, certify the receipt of each Funding
Agreement and Guarantee as may be reasonably requested by the
Indenture Trustee or the Trustee, on behalf of the applicable
Trust;
(d) from time to time upon request by (i) the Indenture Trustee,
or (ii) the Trustee, on behalf of the applicable Trust, and
the Indenture Trustee, submit such information and take such
action as may be reasonably required by the Trustee, on behalf
of the applicable Trust or the Indenture Trustee to assure
3
that each Funding Agreement and Guarantee is maintained in a
proper and secure condition;
(e) upon receipt of any Funding Agreement or Guarantee, issue to
the Indenture Trustee and the applicable Trust a certificate
relating to the applicable Funding Agreement and related
Guarantee in substantially the form attached as Exhibit A
attached hereto, which is made a part hereof;
(f) upon its receipt of written notice from the Indenture Trustee
that an Event of Default has occurred with respect to any
Funding Agreement or a breach of the obligations of PFG under
any Guarantee has occurred and at the written direction of the
Indenture Trustee, deliver each such Funding Agreement and
related Guarantee to the Indenture Trustee;
(g) at its own expense, maintain at all times during the term of
this Custodial Agreement and keep in full force and effect (i)
fidelity insurance, (ii) theft of documents insurance and
(iii) forgery insurance; provided, that such insurance shall
be in amounts, with standard coverage and subject to
deductibles, as are customary for similar insurance typically
maintained by financial institutions that act as custodians in
similar transactions;
(h) unless otherwise specified herein, in providing services
hereunder with respect to any Funding Agreement or Guarantee,
follow the written instructions received from the Indenture
Trustee;
(i) exercise reasonable care and diligence, consistent with
customary standards for such custody, in the possession,
retention and protection of each Funding Agreement and
Guarantee delivered to it under this Custodial Agreement;
(j) except as otherwise required by applicable law, maintain the
confidentiality of the information provided hereunder and in
each Funding Agreement and Guarantee, and not disclose or in
any way communicate such information to third parties without
the express written consent of the Trustee, on behalf of the
applicable Trust (provided, however, that notwithstanding
anything herein to the contrary and except as reasonably
necessary to comply with any applicable federal and state
securities laws, the Custodian (and each employee,
representative or other agent of the Custodian) may disclose
to any and all persons, without limitation of any kind, the
U.S. federal and state income tax treatment and tax structure
of the transaction and all materials of any kind (including
opinions or other tax analyses) that are provided to the
Custodian relating to such U.S. federal and state income tax
treatment and tax structure, where "tax structure" is any fact
that may be relevant to understanding the U.S. federal or
state income tax treatment of the transaction);
4
(k) request written direction from the Indenture Trustee and rely
upon such written direction in the event that (i) any dispute
shall arise between the parties with respect to the
disposition of any Funding Agreement or Guarantee held
hereunder or (ii) the Custodian shall be uncertain as to how
to proceed in a situation not explicitly addressed by the
terms of this Custodial Agreement whether because of
conflicting demands by the other parties hereto or otherwise;
and
(l) have only those duties as are specifically provided herein,
which shall be deemed purely ministerial in nature, and shall
under no circumstance be deemed a fiduciary for any of the
parties to this Custodial Agreement.
SECTION 5.2. Merger, Conversion or Consolidation of Custodian.
Notwithstanding anything herein to the contrary, any banking association or
corporation into which the Custodian may be merged, converted or with which the
Custodian may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Custodian shall be a party, or any
banking association or corporation to which all or substantially all of the
corporate trust business of the Custodian shall be transferred, shall succeed to
all the Custodian's rights, obligations and immunities hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.
SECTION 5.3. Compliance with Writs, Orders or Decrees. In the
event that any Funding Agreement or Guarantee shall be attached, garnished or
levied upon by any court order, or the delivery thereof shall be stayed or
enjoined by an order of a court, or any order, judgment or decree shall be made
or entered by any court order affecting the property deposited under this
Custodial Agreement, the Custodian is hereby expressly authorized, in its sole
discretion, to obey and comply with all writs, orders or decrees so entered or
issued, which it is advised by legal counsel of its own choosing is binding upon
it, whether with or without jurisdiction, and in the event the Custodian obeys
or complies with any such writ, order or decree it shall not be liable to any of
the parties hereto or to any other Person, firm or corporation by reason of such
compliance notwithstanding such writ, order or decree be subsequently reversed,
modified, annulled, set aside or vacated.
SECTION 5.4. Delegation of Duties. The Custodian shall not
employ any third party institution to carry out any of the services to be
provided hereunder without the express written consent of the Indenture Trustee,
which consent shall not be unreasonably withheld.
SECTION 5.5. No Constructive Knowledge. The Custodian shall
not be deemed to have knowledge of the occurrence of a Default or Event of
Default unless the Custodian receives a written notice of such Default or Event
of Default from the Indenture Trustee or the Trustee, on behalf of the
applicable Trust.
SECTION 5.6. Reliance. In performance of its duties under this
Custodial Agreement, the Custodian shall be permitted to rely on any
certificate, instrument, document or communication believed by it to be genuine,
correct and signed by the proper
5
Person or Persons. The Trustee, on behalf of the applicable Trust, and the
Indenture Trustee shall each execute and deliver to the Custodian a certificate
of incumbency for the purpose of establishing the identity of the
representatives of the Trustee, on behalf of the applicable Trust, and the
Indenture Trustee, respectively, entitled to issue instructions or directions to
the Custodian on behalf of each such party. In the event of any change in the
identity of such representatives, a new certificate of incumbency shall be
executed and delivered to the Custodian by the appropriate party. Until such
time as the Custodian shall receive a new incumbency certificate, the Custodian
shall be fully protected in relying without inquiry on any then current
incumbency certificate on file with the Custodian.
SECTION 5.7. Release of Funding Agreements and Guarantees.
Except as consented to by the Indenture Trustee or as otherwise provided in the
Indenture and this Custodial Agreement, the Custodian shall not release any
Funding Agreement or Guarantee from its possession without receiving a prior
written request duly executed on behalf of the Indenture Trustee.
SECTION 5.8. Limitations of Custodian Responsibility.
(a) The Custodian assumes no responsibility under this Custodial
Agreement other than to render the services contemplated
hereunder.
(b) The Custodian assumes no responsibility for the effectiveness,
genuineness, validity or enforceability of any Funding
Agreement or Guarantee in its custody or for making any
inquiry into any such Funding Agreement or Guarantee.
(c) The Custodian shall not be liable or deemed to be in default
for any failure or delay in performance of any duty in whole
or in part arising out of or caused by any of the following: a
major external flood; earthquake; "act of God;" failure of
public utility; act of war; act of terrorism; or rebellion or
revolution in the United States.
SECTION 5.9. Other Activities of the Custodian.
(a) Nothing herein shall prevent the Custodian or any of its
Affiliates from engaging in other businesses, or from
rendering services of any kind to any Trust, the Indenture
Trustee or any other Person or entity to the extent permitted
by applicable law.
(b) It is understood that the Custodian and any of its Affiliates
may engage in any other business and furnish custodial
services to others.
(c) The Custodian will be free, in its sole discretion, to effect
transactions on behalf of itself or for others, which may be
the same as or different from those effected under this
Custodial Agreement.
6
(d) The Custodian shall have the right, but not the obligation to
consult with counsel of its choice and shall not be liable for
action taken or omitted to be taken by the Custodian either in
accordance with the advice of such counsel or in accordance
with any opinion of counsel to any Trust addressed and
delivered to the Custodian.
ARTICLE 6
COMPENSATION, EXPENSES AND INDEMNIFICATION
SECTION 6.1. Compensation, Expenses and Indemnification. The
Custodian shall be entitled to compensation, expenses and indemnification as set
forth in that certain Expense and Indemnity Agreement (the "EXPENSE AND
INDEMNITY AGREEMENT"), dated as of March 5, 2004, entered into between the
Custodian and Principal Life.
ARTICLE 7
REPRESENTATIONS, WARRANTIES AND COVENANTS OF CUSTODIAN
SECTION 7.1. Representations and Warranties of Custodian. The
Custodian hereby represents and warrants to the Indenture Trustee and the
Trustee, for the benefit of each Trust, that:
(a) it is a national banking association duly organized and
validly existing and in good standing under the laws of the
State of Iowa and has full power and authority to own its
assets and to transact the business in which it is currently
engaged and is duly qualified and in good standing under the
laws of each jurisdiction where its ownership or lease of
property or the conduct of its business requires, or the
performance of this Custodial Agreement would require, such
qualification;
(b) it, and each Person acting on its behalf, has full power and
authority to execute and deliver this Custodial Agreement and
to perform all of its obligations under this Custodial
Agreement; and
(c) this Custodial Agreement, and each instrument and document
required hereunder that was executed and delivered by, or on
behalf of, the Custodian, has been executed and delivered by a
duly authorized officer of the Custodian.
SECTION 7.2. Covenants of Custodian. The Custodian hereby
covenants to the Indenture Trustee and the Trustee, for the benefit of each
Trust, that:
(a) at all times it will maintain physical custody and possession
of each Funding Agreement and Guarantee deposited with it
pursuant to the terms of this Custodial Agreement within the
State of Iowa at the location specified in Section 9.5 or at
such other location within the State of Iowa designated by the
Custodian;
7
(b) each instrument and document required to be executed or
delivered by, or on behalf of, the Custodian, shall be
executed and delivered by a duly authorized officer of the
Custodian;
(c) prior to any affiliation with any Trust in the future, it
shall notify the Indenture Trustee of any such contemplated
affiliation; and
(d) it shall not institute, or join any other Person in
instituting, against any Trust any bankruptcy, reorganization,
arrangement, insolvency, moratorium or liquidation proceedings
or other proceedings under federal or state bankruptcy or
similar laws until at least one year and one day (or, if
longer, the applicable preference period then in effect) after
the payment in full of all Notes issued by any Trust in
connection with the Program.
ARTICLE 8
TERMINATION
Section 8.1 General. This Custodial Agreement and the duties
and responsibilities of the Custodian hereunder shall remain in effect until the
occurrence of one or more of the following events:
(a) delivery to the Custodian by the Indenture Trustee of a
written certification signed by the Indenture Trustee that
each Trust organized in connection with the Program has paid
and discharged all obligations with respect to the Notes
issued by each such Trust and that the Program has been
terminated;
(b) termination of each Indenture entered into by each Trust
organized in connection with the Program, and delivery by the
Custodian of each Funding Agreement and Guarantee in its
possession hereunder to the Indenture Trustee or as the
Indenture Trustee shall direct in writing and certification by
the Indenture Trustee that the Program has been terminated; or
(c) termination of this Custodial Agreement pursuant to Section
8.2, 8.3 or 8.4.
SECTION 8.2. Termination by Custodian. This Custodial
Agreement may be terminated by the Custodian, at any time, and the Custodian may
resign, upon 30 days' prior written notice to the Trustee, on behalf of each
Trust and the Indenture Trustee; provided, however, that no termination or
resignation pursuant to this Section 8.2 shall be effective until the date as of
which a successor Custodian shall be appointed in accordance with Section 8.6
and shall have agreed in writing to assume all of the Custodian's duties and
obligations under this Custodial Agreement.
SECTION 8.3. Termination by Indenture Trustee Without Cause.
This Custodial Agreement may be terminated at any time by the Indenture Trustee,
without cause, and the Indenture Trustee may remove the Custodian, upon 30 days'
prior written notice to the Custodian and each Trust (or such shorter notice as
is acceptable to the
8
Custodian and each Trust); provided, however, that no termination or removal
pursuant to this Section 8.3 shall be effective until the date as of which a
successor Custodian shall be appointed in accordance with Section 8.6 and shall
have agreed in writing to assume all of the Custodian's duties and obligations
under this Custodial Agreement.
SECTION 8.4 Termination by Indenture Trustee for Cause. This
Custodial Agreement may be terminated at any time by the Indenture Trustee, for
cause, and the Indenture Trustee may remove the Custodian, upon 10 days' prior
written notice to the Custodian; provided, however, that no termination or
removal pursuant to this Section 8.4 shall be effective until the date as of
which a successor Custodian shall be appointed in accordance with Section 8.6
and shall have agreed in writing to assume all of the Custodian's duties and
obligations under this Custodial Agreement. For purposes of determining "cause"
with respect to any such termination of this Custodial Agreement, such term
shall mean any one of the following events:
(a) the Custodian willfully violates, or takes any action that it
knows materially breaches, any provision of this Custodial
Agreement;
(b) the Custodian materially breaches in any respect any provision
of this Custodial Agreement (other than as specified in
paragraph (a) of this Section 8.4) and fails to cure such
breach within 30 days of its becoming aware, or its receiving
notice from the Indenture Trustee, of such breach;
(c) the Custodian is wound up or dissolved or there is appointed
over it, or a substantial portion of its assets, a receiver,
administrator, administrative receiver, trustee or similar
officer;
(d) the Custodian (i) ceases to be able to, or admits in writing
its inability to, pay its debts as they become due and
payable, or makes a general assignment for the benefit of, or
enters into any composition or arrangement with, its creditors
generally; (ii) applies for or consents to the appointment of
a receiver, trustee, assignee, custodian, liquidator or
sequestrator (or other similar official) of the Custodian or
of any substantial part of its properties or assets, or
authorizes such an application or consent, or proceedings
seeking such appointment are commenced without such
authorization, consent or application against the Custodian
and continue undismissed for 60 days; (iii) authorizes or
files a voluntary petition in bankruptcy, or applies for or
consents to the application of any bankruptcy, reorganization,
arrangement, readjustment of debt, insolvency or dissolution,
or authorizes such application or consent, or proceedings to
such end are instituted against the Custodian without such
authorization, application or consent and are approved as
properly instituted and remain undismissed for 60 days or
result in adjudication of bankruptcy or insolvency; (iv)
permits or suffers all or any substantial part of its
properties or assets to be sequestered or attached by court
order and such order remains undismissed for 60 days; or (v)
engages in any activity analogous
9
to the activities set forth in clauses (i) through (iv) of
this Section 8.4(d) in any applicable jurisdiction; or
(e) the occurrence of an act by the Custodian that constitutes
fraud or criminal activity in the performance of its
obligations under this Custodial Agreement, or the Custodian
being convicted of a criminal offense materially related to
its primary businesses.
SECTION 8.5. Liabilities After Termination. If this Custodial
Agreement is terminated as provided herein, none of the parties hereto shall
have any further liability or obligation to the other parties hereto, except as
provided in Sections 5.1(j), 8.6, 8.7 and 8.8 of this Custodial Agreement.
SECTION 8.6. Appointment of Successor Custodian. Any removal
or resignation of the Custodian while any Notes are Outstanding will be
effective only upon the appointment by the Indenture Trustee (and the acceptance
in writing by such successor Custodian) of a successor Custodian that is an
established institution in the State of Iowa which (a) has demonstrated an
ability to professionally and competently perform duties similar to those
imposed upon the Custodian hereunder and (b) is legally qualified and has the
capacity to act as Custodian hereunder in the assumption of all of the
responsibilities, duties and obligations of the Custodian hereunder. The
Trustee, on behalf of each Trust, the Indenture Trustee, the Custodian and the
successor Custodian shall take such action (or cause the removed or resigning
Custodian to take such action) consistent with this Custodial Agreement as shall
be necessary to effectuate any such succession.
SECTION 8.7. Rights and Remedies of Indenture Trustee
Regarding Termination. In the event of removal of the Custodian pursuant to this
Custodial Agreement by the Indenture Trustee, the Indenture Trustee shall have
all of the rights and remedies available with respect thereto at law or equity,
and, without limiting the foregoing, the Indenture Trustee may by notice in
writing to the Custodian as provided under this Custodial Agreement terminate
all the rights and obligations of the Custodian under this Custodial Agreement
(except those that survive termination pursuant to Section 8.5). Upon the
expiration of any applicable notice period with respect to termination of this
Custodial Agreement, all authority and power of the Custodian under this
Custodial Agreement, whether with respect to each Funding Agreement or Guarantee
or otherwise, shall automatically and without further action by any Person or
entity pass to and be vested in the successor Custodian upon the appointment
thereof and the agreement of such successor Custodian to assume the Custodian's
duties and obligations under this Custodial Agreement.
SECTION 8.8. Actions Upon Termination.
(a) Upon the effective date of termination of this Custodial
Agreement, the Custodian shall, as soon as practicable:
(i) deliver to the Indenture Trustee, the successor
Custodian or to such other Person as the Indenture
Trustee directs in writing all Funding
10
Agreements and Guarantees then in the custody of the
Custodian; and
(ii) deliver to the Indenture Trustee or successor Custodian
an accounting with respect to the books and records
relating to each Funding Agreement and Guarantee that
was delivered to the Custodian.
(b) Notwithstanding any such termination, the Custodian shall
remain liable to the extent set forth herein (but subject to
Section 8.6) for its acts or omissions hereunder arising prior
to termination and for any expenses, losses, claims, damages,
judgments, assessments, costs or other liabilities (including
reasonable attorneys' fees) in respect of or arising out of a
material breach of the representations, warranties or
covenants made by the Custodian under this Custodial Agreement
or from any failure of the Custodian to comply with the
provisions of this Section 8.8.
(c) The Custodian agrees that, notwithstanding any termination, it
shall reasonably cooperate in any proceeding arising in
connection with this Custodial Agreement, the Indenture or any
Funding Agreement or Guarantee upon receipt of appropriate
indemnification and expense reimbursement.
ARTICLE 9
GENERAL PROVISIONS
SECTION 9.1. Binding Effect; Successors, Transferees and
Assigns. This Custodial Agreement shall be binding upon the parties hereto,
their respective successors, transferees and assigns, and shall inure the
benefit of and be enforceable by all parties hereto and their respective
successors, transferees and permissible assigns.
SECTION 9.2. Amendments. This Custodial Agreement may not be
amended without the express written consent of the Custodian, the Indenture
Trustee and the Trustee acting on behalf of each Trust.
SECTION 9.3. Assignment of Funding Agreements and Guarantees.
No collateral assignment, grant of security interest or similar action by, or on
behalf of, any Trust of any Funding Agreement or Guarantee shall be recognized
by the Custodian or be effective unless approved in writing by the Indenture
Trustee.
SECTION 9.4. Notices. All notices, requests and other
communications under this Custodial Agreement shall be in writing (including
bank wire, facsimile or similar writing) and shall be given to the relevant
Person at its address or facsimile number set forth below or such other address
or facsimile number as such Person may hereafter specify for such purpose by not
less than 10 Business Days' prior notice to each other Person specified in this
Section 9.4. Each such notice, request or other communication shall be effective
(a) if given by facsimile, when such facsimile is transmitted to the
11
facsimile number specified pursuant to this Section 9.4, (b) if given by mail,
48 hours after such communication is deposited in the mails with first class
postage prepaid, or (c) if given by any other means, when delivered or received
at the address specified in this Section 9.4.
Such notices, requests and other communications shall be
addressed, if to the Trust, to:
Principal Life Income Fundings Trust
c/o U.S. Bank Trust National Association, as Trustee
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
if to the Indenture Trustee, to:
Citibank, N.A.
Citibank Agency & Trust
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, 14th Floor, ▇▇▇▇ ▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
if to the Trustee, to:
U.S. Bank Trust National Association
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Facsimile: 212-509-3384
SECTION 9.5. Address of Custodian. The Custodian shall hold
each Funding Agreement and Guarantee at the following address:
Bankers Trust Company, N.A.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. Brick
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
SECTION 9.6. Waiver of Certain Rights. The Custodian hereby
waives, relinquishes and releases any rights which it may have by way of
contract or law, whether through exercise of a right of set-off, security
interest, counterclaim or otherwise, to obtain any property or payment from,
under or with respect to any Funding Agreement or Guarantee delivered to it
hereunder.
12
SECTION 9.7. Provisions Separable. Any provision of this
Custodial Agreement which is prohibited, unenforceable or not authorized in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition, unenforceability or non-authorization without invalidating the
remaining provisions hereof or affecting the validity or enforceability or
legality of such provision in any other jurisdiction.
SECTION 9.8. Governing Law. This Custodial Agreement shall be
governed by and construed in accordance with the laws of the State of New York,
without regard to its choice of law principles.
SECTION 9.9. Waiver of Jury Trial. Each of the parties to this
Custodial Agreement hereby irrevocably waives any and all right to a trial by
jury with respect to any legal proceeding arising out of or relating to this or
any related transaction.
SECTION 9.10. Headings Not to Affect Interpretation. The
headings contained in this Custodial Agreement are for convenience only, and
they neither form a part of this Custodial Agreement nor are they to be used in
the construction or interpretation hereof.
SECTION 9.11. Counterparts. This Custodial Agreement may be
executed and delivered in any number of counterparts, each of which, when so
executed and delivered, shall be an original; provided, however, that such
counterparts shall together constitute but one and the same instrument.
13
IN WITNESS WHEREOF, the parties have caused this Custodial
Agreement to be duly executed by their respective authorized officers, as of the
date first above written.
BANKERS TRUST COMPANY, N.A., as
Custodian
By:
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. Brick
Title: Vice President
CITIBANK, N.A., as Indenture Trustee for
the benefit of the holders of the Notes
issued in connection with the Program
By:
-------------------------------------
Name:
Title:
U.S. BANK TRUST NATIONAL ASSOCIATION, as
Trustee, on behalf of each Trust
organized in connection with the Program
By:
-------------------------------------
Name:
Title:
14
EXHIBIT A
CERTIFICATE REGARDING CUSTODY OF THE
FUNDING AGREEMENT AND THE GUARANTEE
In connection with the issuance of the Funding Agreement, the
Assignment of Funding Agreement (set forth in Part IV of the Closing Instrument
(as defined in the Omnibus Instrument)) and the issuance of the Guarantee, the
Custodian hereby represents that it has received delivery of the Funding
Agreement and the Guarantee and is holding the Funding Agreement and the
Guarantee for the benefit of the Indenture Trustee and that the Funding
Agreement and the Guarantee are in the possession of the Custodian at the
address below:
Bankers Trust Company, N.A.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
A-1