WSP&R
DRAFT
9/14/98
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AMENDED AND RESTATED DECLARATION OF TRUST
NVP CAPITAL III
DATED AS OF ________, 1998
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TABLE OF CONTENTS
PAGE
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ARTICLE I
INTERPRETATION AND DEFINITIONS
Section 1.1 Definitions. . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application . . . . . . . . . . . . . . 7
Section 2.2 Lists of Holders of Trust Securities . . . . . . . . . . . . 7
Section 2.3 Reports by the Property Trustee. . . . . . . . . . . . . . . 8
Section 2.4 Periodic Reports to Property Trustee . . . . . . . . . . . . 8
Section 2.5 Evidence of Compliance with Conditions Precedent . . . . . . 8
Section 2.6 Events of Default; Waiver. . . . . . . . . . . . . . . . . . 8
Section 2.7 Event of Default; Notice . . . . . . . . . . . . . . . . . . 9
ARTICLE III
ORGANIZATION
Section 3.1 Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3.2 Office . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3.3 Purpose. . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3.4 Authority. . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.5 Title to Property of the Trust . . . . . . . . . . . . . . . 11
Section 3.6 Powers and Duties of the Regular Trustees. . . . . . . . . . 11
Section 3.7 Prohibition of Actions by the Trust and the Trustees . . . . 13
Section 3.8 Powers and Duties of the Property Trustee. . . . . . . . . . 14
Section 3.9 Certain Duties and Responsibilities of the Property Trustee. 16
Section 3.10 Certain Rights of Property Trustee.. . . . . . . . . . . . . 18
Section 3.11 Delaware Trustee.. . . . . . . . . . . . . . . . . . . . . . 20
Section 3.12 Execution of Documents.. . . . . . . . . . . . . . . . . . . 20
Section 3.13 Not Responsible for Recitals or Issuance of Trust
Securities . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 3.14 Duration of Trust. . . . . . . . . . . . . . . . . . . . . . 20
Section 3.15 Mergers. . . . . . . . . . . . . . . . . . . . . . . . . . . 20
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ARTICLE IV
SPONSOR
Section 4.1 Sponsor's Purchase of Common Securities. . . . . . . . . . . 22
Section 4.2 Responsibilities of the Sponsor. . . . . . . . . . . . . . . 22
ARTICLE V
TRUSTEES
Section 5.1 Number of Trustees . . . . . . . . . . . . . . . . . . . . . 23
Section 5.2 Delaware Trustee; Eligibility. . . . . . . . . . . . . . . . 23
Section 5.3 Property Trustee; Eligibility. . . . . . . . . . . . . . . . 23
Section 5.4 Qualifications of Regular Trustees Generally . . . . . . . . 24
Section 5.5 Initial Trustees.. . . . . . . . . . . . . . . . . . . . . . 24
Section 5.6 Appointment, Removal and Resignation of Trustees . . . . . . 25
Section 5.7 Vacancies among Trustees . . . . . . . . . . . . . . . . . . 26
Section 5.8 Effect of Vacancies. . . . . . . . . . . . . . . . . . . . . 26
Section 5.9 Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 5.10 Delegation of Power. . . . . . . . . . . . . . . . . . . . . 27
ARTICLE VI
DISTRIBUTIONS
Section 6.1 Distributions. . . . . . . . . . . . . . . . . . . . . . . . 27
ARTICLE VII
ISSUANCE OF TRUST SECURITIES
Section 7.1 General Provisions Regarding Trust Securities. . . . . . . . 27
ARTICLE VIII
TERMINATION
Section 8.1 Termination of Trust . . . . . . . . . . . . . . . . . . . . 29
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ARTICLE IX
TRANSFER OF INTEREST
Section 9.1 Transfer of Trust Securities . . . . . . . . . . . . . . . . 29
Section 9.2 Transfer of Certificates . . . . . . . . . . . . . . . . . . 30
Section 9.3 Deemed Trust Security Holders. . . . . . . . . . . . . . . . 30
Section 9.4 Book-Entry Interests . . . . . . . . . . . . . . . . . . . . 30
Section 9.5 Notices to Depositary. . . . . . . . . . . . . . . . . . . . 31
Section 9.6 Appointment of Successor Depositary. . . . . . . . . . . . . 31
Section 9.7 Definitive Preferred Security Certificates . . . . . . . . . 31
Section 9.8 Mutilated, Destroyed, Lost or Stolen Certificates. . . . . . 32
ARTICLE X
LIMITATION OF LIABILITY OF HOLDERS
OF TRUST SECURITIES, TRUSTEES OR OTHERS
Section 10.1 Liability. . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 10.2 Exculpation. . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 10.3 Fiduciary Duty . . . . . . . . . . . . . . . . . . . . . . . 34
Section 10.4 Indemnification. . . . . . . . . . . . . . . . . . . . . . . 35
Section 10.5 Outside Businesses . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE XI
ACCOUNTING
Section 11.1 Fiscal Year. . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 11.2 Certain Accounting Matters . . . . . . . . . . . . . . . . . 36
Section 11.3 Banking. . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 11.4 Withholding. . . . . . . . . . . . . . . . . . . . . . . . . 37
ARTICLE XII
AMENDMENTS AND MEETINGS
Section 12.1 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 12.2 Meetings of the Holders of Trust Securities; Action by
Written Consent. . . . . . . . . . . . . . . . . . . . . . . 39
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ARTICLE XIII
REPRESENTATIONS AND WARRANTIES OF
PROPERTY TRUSTEE AND DELAWARE TRUSTEE
Section 13.1 Representations and Warranties of Property Trustee . . . . . 40
Section 13.2 Representations and Warranties of Delaware Trustee . . . . . 41
ARTICLE XIV
MISCELLANEOUS
Section 14.1 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 14.2 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . 43
Section 14.3 Intention of the Parties . . . . . . . . . . . . . . . . . . 43
Section 14.4 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 14.5 Successors and Assigns . . . . . . . . . . . . . . . . . . . 43
Section 14.6 Partial Enforceability . . . . . . . . . . . . . . . . . . . 43
Section 14.7 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . 43
Exhibit A . . . . . . . . Terms of Trust Securities
Exhibit B . . . . . . . . Form of Preferred Securities Guarantee Agreement
Exhibit C . . . . . . . . Form of Common Securities Guarantee Agreement
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CROSS-REFERENCE TABLE*
Section of Trust Indenture
Act of 1939, as amended Section of Declaration
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310(a) 5.3(a)
310(b) 5.3(c)
310(c) Inapplicable
311(c) Inapplicable
312(a) 2.2(a)
312(b) 2.2(b)
313 2.3
314(a) 2.4
314(b) Inapplicable
314(c) 2.5
314(d) Inapplicable
314(f) Inapplicable
315(a) 3.9(b)
315(b) 2.7
315(c) 3.9(a)
315(d) 3.9(b)
316(a) 2.6, Exhibit A 5(b) & 6(c)
316(c) 3.6(c)
317(a) 3.8(e) & 3.8(g)
317(b) 3.8(h)
318 2.1
* This Cross-Reference Table does not constitute part of the Declaration and
shall not affect the interpretation of any of its terms or provisions.
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AMENDED AND RESTATED DECLARATION OF TRUST
AMENDED AND RESTATED DECLARATION OF TRUST (this "Declaration") of NVP
Capital III (the "Trust") dated as of ________, 1998 among (a) Nevada Power
Company, a Nevada corporation, as trust sponsor (the "Sponsor"), (b) IBJ
▇▇▇▇▇▇▇▇ Bank & Trust Company, a New York banking corporation, as property
trustee (the "Property Trustee"), (c) Delaware Trust Capital Management, Inc., a
Delaware banking association, as Delaware trustee (the "Delaware Trustee"), (d)
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, individuals whose address is c/o
Nevada Power Company, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ (each, a
"Regular Trustee" and, together with the Property Trustee and the Delaware
Trustee, the "Trustees") and (e) the holders, from time to time, of undivided
beneficial interests in the Trust to be issued pursuant to this Declaration.
WHEREAS, the Delaware Trustee and the Sponsor established the Trust under
the Business Trust Act (as hereinafter defined) pursuant to a Declaration of
Trust dated as of March 23, 1998, (the "Original Declaration") and a Certificate
of Trust filed with the Secretary of State of the State of Delaware on March 23,
1998, for the sole purpose of issuing and selling certain securities
representing undivided beneficial interests in the assets of the Trust and
investing the proceeds thereof in the Subordinated Debentures (as hereinafter
defined);
WHEREAS, as of the date hereof, no interests in the Trust have been issued;
and
WHEREAS, all of the Trustees and the Sponsor, by this Declaration, amend
and restate each and every term and provision of the Original Declaration;
NOW, THEREFORE, it being the intention of the parties hereto to continue
the Trust as a business trust under the Business Trust Act and that this
Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
Section 1.1 DEFINITIONS
(a) Capitalized terms used in this Declaration but not defined in the
preamble above have the respective meanings assigned to them in this
Section 1.1;
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "this Declaration" are to this Declaration as
modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections and
Exhibits are to Articles and Sections of, and Exhibits to, this
Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Declaration unless otherwise defined in this Declaration
or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means any Person that is authorized to
bind such Person and, with respect to the Sponsor, the Chairman of the Board,
the Chief Executive Officer, the President, any Vice President, the Treasurer,
any assistant Treasurer, or other officer or agent of the Sponsor duly
authorized by the board of directors of the Sponsor to act in respect of matters
relating to this Declaration.
"Book-Entry Interests" mean beneficial interests in a Global Certificate,
ownership and transfers of which shall be maintained and made through
book-entries by the Depositary as described in Section 9.4.
"Business Day" means any day other than a day on which banking institutions
in New York, New York are authorized or required by law 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.
"Certificate" means a Common Security Certificate or a Preferred Security
Certificate.
"Closing Date" means _______, 1998.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Securities" has the meaning specified in Section 7.1.
"Common Securities Guarantee" means the guarantee agreement of the Sponsor
dated as of _________, 1998 in respect of the Common Securities in the form of
Exhibit C.
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"Common Security Certificate" means a definitive certificate in fully
registered form representing a Common Security substantially in the form of
Annex II to Exhibit A.
"Corporate Trust Office" means the principal office of the Property Trustee
at which at any particular time its corporate trust business shall be
administered which office at the date of execution of this Declaration is
located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Corporate
Trust Department.
"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 of Trust Securities.
"Delaware Trustee" has the meaning set forth in the preamble hereof and any
successor trustee meeting the eligibility requirements set forth in Section 5.2.
"Definitive Preferred Security Certificates" has the meaning set forth in
Section 9.4.
"Depositary" means an organization registered as a clearing agency pursuant
to Section 17A of the Exchange Act that is acting as depositary for the
Preferred Securities and in whose name or in the name of a nominee of that
organization shall be registered a Global Certificate and which shall undertake
to effect book-entry transfers and pledges of Book-Entry Interests.
"Depositary Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Depositary effects
book-entry transfers and pledges of securities deposited with the Depositary.
"Direction" by a Person means a written direction signed:
(a) if the Person is a natural person, by that Person; or
(b) in any other case, in the name of such Person by one or more
Authorized Officers of that Person.
"Distribution" means a distribution payable to Holders of Trust Securities
in accordance with Section 6.1.
"DTC" means The Depository Trust Company, New York, New York, the initial
Depositary.
"Exchange Act" means the Securities Exchange Act of 1934, as the same may
be amended from time to time, or any successor legislation.
"Event of Default," in respect of the Trust Securities, means an Event of
Default (as defined in the Indenture) has occurred and is continuing in respect
of the Subordinated Debentures.
"Global Certificate" has the meaning specified in Section 9.4.
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"Guarantee Trustee" means IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company, as trustee
under the Preferred Securities Guarantee, until a successor is appointed
thereunder and thereafter means such successor trustee.
"Holder" means a Person in whose name a Certificate representing a Trust
Security is registered on the books and records of the Trust, such Person being
a beneficial owner within the meaning of the Business Trust Act, PROVIDED, THAT,
in determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Sponsor, as guarantor of the Trust Securities, or any
Affiliate of the Sponsor.
"Indemnified Person" means (a) any Trustee or the Property Trustee; (b) any
Affiliate of any Trustee or the Property Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Trustee or the Property Trustee; or (d) any employee or agent of the Trust or
its Affiliates.
"Indenture" means the Indenture dated as of _________, 1998 among the
Sponsor and the Indenture Trustee as modified, supplemented or amended from time
to time.
"Indenture Trustee" means IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company, 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
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940, as the
same may be amended from time to time, or any successor legislation.
"Legal Action" has the meaning set forth in Section 3.6(e).
"Majority in liquidation amount" means, except as provided in the terms of
the Trust Securities and the Trust Indenture Act, Holders of outstanding Trust
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, representing 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
Trust Securities of the relevant class.
"Maturity Date" has the meaning set forth in Section 101 of the Indenture.
"Officer's Certificate" means, with respect to any Person, a certificate
signed by an Authorized Officer of such Person. Any Officer's Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Declaration shall include:
(a) a statement that such officer signing the Certificate has read
the covenant or condition and the definition relating thereto;
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(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the
Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to
enable such officer to express an informed opinion as to whether
or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such
condition or covenant has been complied with.
"Opinion of Counsel" or "opinion of counsel" means a written opinion of
counsel who may be counsel of the Trustee, the Property Trustee, or the Sponsor,
and who shall be reasonably acceptable to the Property Trustee.
"Paying Agent" has the meaning specified in Section 3.8(h).
"Payment Amount" has the meaning specified in Section 6.1.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Preferred Securities Guarantee" means the guarantee agreement between the
Sponsor and the Guarantee Trustee dated as of _________, 1998, in respect of the
Preferred Securities in the form of Exhibit B.
"Preferred Securities" has the meaning specified in Section 7.1.
"Preferred Security Beneficial Owner" means, with respect to a Book-Entry
Interest, a Person who is the beneficial owner of such Book-Entry Interest, as
reflected on the books of the Depositary, or on the books of a Person
maintaining an account with such Depositary (directly as a Depositary
Participant or as an indirect participant, in each case in accordance with the
rules of such Depositary).
"Preferred Security Certificate" means a certificate representing a
Preferred Security substantially in the form of Annex I to Exhibit A.
"Property Trustee" has the meaning set forth in the preamble hereof or any
successor trustee meeting the eligibility requirements set forth in Section 5.3.
"Property Trustee Account" has the meaning set forth in Section 3.8(c).
"Prospectus" means that certain prospectus dated _________, 1998 relating
to the Preferred Securities.
5
"Quorum" means a majority of the Regular Trustees or, if there are only two
Regular Trustees, both of them.
"Regular Trustee" has the meaning set forth in the preamble hereof, or any
successor in interest in such capacity, or any successor trustee appointed as
herein provided.
"Related Party" means, with respect to the Sponsor, any direct or indirect
wholly owned subsidiary of the Sponsor or any other Person that owns, directly
or indirectly, 100% of the outstanding voting securities of the Sponsor.
"Responsible Officer" means, with respect to the Property Trustee, any
vice-president, any assistant vice-president, the secretary, any assistant
secretary, the treasurer, any assistant treasurer or any other officer in the
Corporate Trust Office of the Property Trustee customarily performing functions
similar to those performed by any of the above designated officers and having
direct responsibility for the administration of this Declaration and also means,
with respect to a particular corporate trust matter, any other officer to whom
such matter is referred because of that officer's knowledge of and familiarity
with the particular subject.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act.
"Securities Act" means the Securities Act of 1933, as the same may be
amended from time to time, or any successor legislation.
"66-2/3% in liquidation amount" means, except as provided in the terms of
the Trust Securities and by the Trust Indenture Act, Holders of outstanding
Trust 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, representing at least 66-2/3% 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 Trust Securities of the relevant class.
"Sponsor" has the meaning set forth in the preamble hereof or any successor
entity in a merger, consolidation or amalgamation.
"Subordinated Debentures" means $72,164,950 aggregate principal amount of
___% Junior Subordinated Deferrable Interest Debentures due 2038 to be issued by
the Sponsor under the Indenture and to be held by the Property Trustee for the
benefit of the Trust.
"Successor Entity" has the meaning set forth in Section 3.15(b).
"Successor Securities" has the meaning set forth in Section 3.15(b).
"10% in liquidation amount" means, except as provided in the terms of the
Trust Securities or by the Trust Indenture Act, Holders of outstanding Trust
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, representing at least 10% of the
aggregate liquidation amount (including the stated amount that would be paid on
6
redemption, liquidation or otherwise, plus accumulated and unpaid Distributions
to the date upon which the voting percentages are determined) of all outstanding
Trust Securities of the relevant class.
"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Trustee" or "Trustees" has the meaning set forth in the preamble hereof,
so long as such person shall continue in office in accordance with the terms
hereof, and all other Persons who may from time to time be duly appointed,
qualified and serving as Trustees in accordance with the provisions hereof, and
references herein to a Trustee or the Trustees shall refer to such Person or
Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as the same
may be amended from time to time, or any successor legislation.
"Trust Securities" means collectively the Common Securities and the
Preferred Securities.
"Underwriting Agreement" means the underwriting agreement for the offering
and sale of the Preferred Securities by the underwriters named therein.
ARTICLE II
TRUST INDENTURE ACT
Section 2.1 TRUST INDENTURE ACT; APPLICATION
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and
shall, to the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee that is a Trustee
for purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by Sections 310
to 317, inclusive, of the Trust Indenture Act, such duties imposed by
the Trust Indenture Act shall control.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Trust Securities as equity
securities representing undivided beneficial interests in the assets
of the Trust.
(e) The Regular Trustee executing the certificate under Section
3.6(h) shall be deemed the principal executive officer and chief
financial officer of the Trust for purposes of the Trust Indenture
Act.
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Section 2.2 LISTS OF HOLDERS OF TRUST SECURITIES.
(a) Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide the Property Trustee (i) within 14 days after each
record date for payment of Distributions, a list, in such form as the
Property Trustee may reasonably require, of the names and addresses of
the Holders of the Trust Securities ("List of Holders") as of such
record date, PROVIDED THAT none of the Sponsor or the Regular 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 Regular Trustees on behalf of the Trust, and (ii) at any other
time, within 30 days of receipt by the Trust of a written request for
a List of Holders as of a date no more than 14 days before such List
of Holders is given to the Property Trustee. 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 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 the obligations of an
indenture trustee under Sections 311(a), 311(b) and 312(b) of the
Trust Indenture Act.
Section 2.3 REPORTS BY THE PROPERTY TRUSTEE. Within 60 days after
December 31 of each year, the Property Trustee shall provide to the Holders of
the Preferred Securities such reports as are required by Section 313 of the
Trust Indenture Act, if any, in the form and in the manner provided by Section
313 of the Trust Indenture Act. The Property Trustee shall also comply with the
requirements of Section 313(d) of the Trust Indenture Act.
Section 2.4 PERIODIC REPORTS TO PROPERTY TRUSTEE. Each of the Sponsor
and the Regular Trustees on behalf of the Trust shall provide to the Property
Trustee such documents, reports and information as required by Section 314 (if
any) of the Trust Indenture Act and the compliance certificate required by
Section 314 of the Trust Indenture Act in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act.
Section 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT. Each of
the Sponsor and the Regular 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 Declaration that relate to any of the matters set
forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by officers of the Sponsor and the Regular Trustee pursuant
to Section 314(c)(1) of the Trust Indenture Act may be given in the form of an
Officer's Certificate.
Section 2.6 EVENTS OF DEFAULT; WAIVER.
(a) The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the
Preferred Securities, waive any past
8
Event of Default with respect to the Preferred Securities and its
consequences, PROVIDED THAT, if the underlying Event of Default under the
Indenture:
(i) is not waivable under the Indenture, the Event of Default under
this Declaration shall also not be waivable; or
(ii) requires the consent or vote of all of the holders of the
Subordinated Debentures to be waived under the Indenture, the Event of
Default under this Declaration may only be waived by the vote of all
of the Holders of the Preferred Securities.
Upon such waiver, any such default shall cease to exist, and any Event of
Default with respect to the Preferred Securities arising therefrom shall be
deemed to have been cured, for every purpose of this Declaration, but no
such waiver shall extend to any subsequent or other default or an Event of
Default with respect to the Preferred Securities or impair any right
consequent thereon. Any waiver by the Holders of the Preferred Securities
of an Event of Default with respect to the Preferred Securities shall also
be deemed to constitute a waiver by the Holders of the Common Securities of
any such Event of Default with respect to the Common Securities for all
purposes of this Declaration 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, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, PROVIDED THAT, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived such
Event of Default under this Declaration as provided below in this
Section 2.6(b), the Event of Default under this Declaration shall
also not be waivable; or
(ii) requires the consent or vote of all of the holders of the
Subordinated Debentures to be waived, except where the Holders of
the Common Securities are deemed to have waived such Event of
Default under this Declaration as provided below in this Section
2.6(b), the Event of Default under this Declaration may only be
waived by the vote of all of the Holders of Common Securities;
PROVIDED THAT, each Holder of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with
respect to the Common Securities and its consequences until all Events
of Default with respect to the Preferred Securities have been cured,
waived or otherwise eliminated, and until such Events of Default 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
9
the right to direct the Property Trustee in accordance with the terms
of the Trust Securities. Subject to the foregoing provisions of this
Section 2.6(b), upon such waiver, any such default shall cease to
exist and any Event of Default with respect to the Common Securities
arising therefrom shall be deemed to have been cured for every
purpose of this Declaration but no such waiver shall extend to any
subsequent or other default or Event of Default with respect to the
Common Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the
Property Trustee at the direction of the Holders of the Preferred
Securities, constitutes a waiver of the corresponding Event of Default
under this Declaration.
Section 2.7 EVENT OF DEFAULT; NOTICE.
(a) The Property Trustee shall, within 90 days after the occurrence
of an Event of Default, transmit by mail, first class postage prepaid,
to the Holders of the Trust Securities, notices of all defaults with
respect to the Trust Securities known to the Property Trustee, unless
such defaults have been cured before the giving of such notice (the
term "defaults" for the purposes of this Section 2.7(a) being hereby
defined to be an Event of Default as defined in the Indenture, not
including any periods of grace provided for therein and irrespective
of the giving of any notice provided therein); PROVIDED THAT, except
for a default in the payment of principal of or interest on any of the
Subordinated Debentures, the Property Trustee shall be protected in
withholding such notice if and so long as Responsible Officers of the
Property Trustee in good faith determine that the withholding of such
notice is in the interests of the Holders of the Trust Securities.
(b) The Property Trustee shall not be deemed to have knowledge of any
default except:
(i) a default under Sections 401(l) and 401(2) of the Indenture;
or
(ii) any default as to which a Responsible Officer of the
Property Trustee charged with the administration of this
Declaration shall have obtained written or actual notice.
ARTICLE III
ORGANIZATION
Section 3.1 NAME. The Trust is named "NVP Capital III", as such
name may be modified from time to time by the Regular Trustees following
written notice to the Holders of Trust Securities. The Trust's activities
may be conducted under the name of the Trust or any other name deemed
advisable by the Regular Trustees.
10
Section 3.2 OFFICE. The address of the principal office of the
Trust is c/o Nevada Power Company, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇. On ten Business Days written notice to the Holders of Trust
Securities, the Regular Trustees may designate another principal office.
Section 3.3 PURPOSE. The exclusive purposes and functions of the
Trust are (a) to issue and sell Trust Securities and use the proceeds from
such sale to acquire the Subordinated Debentures and (b) except as otherwise
limited herein, to engage in only those other activities necessary or
incidental thereto. The Trust shall not borrow money, issue debt or reinvest
proceeds derived from investments, pledge any of its assets, or otherwise
undertake (or permit to be undertaken) any activity that would cause the
Trust not to be classified for United States federal income tax purposes as a
grantor trust. All provisions of this Declaration shall be interpreted in a
manner consistent with such purposes.
Section 3.4 AUTHORITY. Subject to the limitations provided in
this Declaration, including the provisions of Sections 3.11, 5.2 and 8.1(b),
and to the specific duties of the Property Trustee, the Regular Trustees
shall have exclusive and complete authority to carry out the purposes of the
Trust. An action taken by the Regular 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 in accordance with its powers shall constitute
the act of and serve to bind the Trust. In dealing with the Regular Trustees
acting on behalf of the Trust, no Person shall be required to inquire into
the authority of the Regular Trustees to bind the Trust. Persons dealing
with the Trust are entitled to rely conclusively on the power and authority
of the Trustees as set forth in this Declaration.
Section 3.5 TITLE TO PROPERTY OF THE TRUST. Except as provided in
Section 3.8 with respect to the Subordinated Debentures and the Property
Trustee Account or as otherwise provided in this Declaration, legal title to
all assets of the Trust shall be vested in the Trust. The Holders shall not
have legal title to any part of the assets of the Trust, but shall have an
undivided beneficial interest in the assets of the Trust.
Section 3.6 POWERS AND DUTIES OF THE REGULAR TRUSTEES. The Regular
Trustees shall have the exclusive power, duty and authority to cause the
Trust to engage in the following activities:
(a) to issue and sell the Preferred Securities and the Common
Securities in accordance with this Declaration; 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 Trust Securities, and the issuance of Trust Securities shall
be limited to the simultaneous issuance of both Preferred Securities
and Common Securities on the Closing Date;
(b) to acquire the Subordinated Debentures with the proceeds of the
sale of the Trust Securities; PROVIDED, HOWEVER, that the Regular
Trustees shall cause legal title to the Subordinated Debentures to be
held of record in the name of the Property Trustee for the benefit of
the Holders of the Trust Securities;
11
(c) 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 Trust
Indenture Act, Distributions, voting rights, redemptions and
exchanges, and to issue relevant notices to the Holders of Trust
Securities as to such actions and applicable record dates;
(d) to take all actions and perform such duties as may be required of
the Regular Trustees pursuant to the terms of the Trust Securities;
(e) 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;
(f) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors,
advisors, and consultants and pay reasonable compensation for such
services;
(g) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;
(h) to give the certificate required by Section 314(a)(4) of the
Trust Indenture Act to the Property Trustee, which certificate may be
executed by a Regular Trustee;
(i) to incur expenses that are necessary or incidental to carry out
any of the purposes of the Trust;
(j) to act as, or appoint another Person to act as, registrar and
transfer agent for the Trust Securities;
(k) to give prompt written notice to the Holders of the Trust
Securities and the Property Trustee of any notice received from the
Sponsor of its election (i) to defer payments of interest on the
Subordinated Debentures by extending the interest payment period under
the Indenture or (ii) to extend the scheduled maturity date on the
Subordinated Debentures pursuant to the Indenture;
(l) to execute 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;
(m) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence,
rights, franchises and privileges as a statutory business trust under
the laws of the State of Delaware and of each other jurisdiction in
which such existence is necessary to protect the limited liability of
the Holders of the Trust Securities or to enable the Trust to effect
the purposes for which the Trust was created;
12
(n) to take any action, not inconsistent with this Declaration or
with applicable law, that the Regular Trustees determine in their
discretion to be necessary or desirable in carrying out 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 Investment Company
Act;
(ii) causing the Trust to be classified for United States
federal income tax purposes as a grantor trust; and
(iii) cooperating with the Sponsor to ensure that the
Subordinated Debentures will be treated as indebtedness of the
Sponsor for United States federal income tax purposes,
PROVIDED THAT such action does not adversely affect the interests
of Holders or vary the terms of the Preferred Securities; and
(o) 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 Regular Trustees, on
behalf of the Trust.
The Regular Trustees must 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 Regular Trustees 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 Regular Trustees shall have none of the
powers or the authority of the Property Trustee set forth in Section 3.8.
Section 3.7 PROHIBITION OF ACTIONS BY THE TRUST AND THE TRUSTEES
(a) The Trust shall not, and the Trustees and the Property Trustee
shall not, engage in any activity other than as required or authorized
by this Declaration. In particular, the Trust shall not and the
Trustees and the Property Trustee shall cause the Trust not to:
(i) invest any proceeds received by the Trust from holding the
Subordinated Debentures, but shall distribute all such proceeds
to Holders of Trust Securities pursuant to the terms of this
Declaration and of the Trust Securities;
(ii) acquire any assets other than as expressly provided
herein;
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness other than loans
represented by the Subordinated Debentures;
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(v) possess any power or otherwise act in such a way as to
vary the Trust assets or the terms of the Trust Securities in any
way whatsoever;
(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Trust Securities; or
(vii) other than as provided in this Declaration or as set forth
in Exhibit A hereto, (A) direct the time, method and place of
exercising any trust or power conferred upon the Indenture
Trustee with respect to the Subordinated Debentures, (B) waive
any past default that is waivable under Section 413 of the
Indenture, (C) exercise any right to rescind or annul any
declaration that the principal of all the Subordinated Debentures
shall be due and payable or (D) consent to any amendment,
modification, waiver or termination of the Indenture or the
Subordinated Debentures where such consent shall be required
unless the Trust shall have received an opinion of counsel to the
effect that such modification will not cause more than an
insubstantial risk that for United States federal income tax
purposes the Trust will not be classified as a grantor trust.
Section 3.8 POWERS AND DUTIES OF THE PROPERTY TRUSTEE.
(a) The legal title to the Subordinated Debentures shall be owned by
and held of record in the name of the Property Trustee in trust for
the benefit of the Holders of the Trust Securities. The right, title
and interest of the Property Trustee to the Subordinated Debentures
shall vest automatically in each Person who may hereafter be appointed
as Property Trustee in accordance with Section 5.6. Such vesting and
cessation of title shall be effective whether or not conveyancing
documents with regard to the Subordinated Debentures have been
executed and delivered.
(b) The Property Trustee shall not transfer its right, title and
interest in the Subordinated Debentures to the Regular 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 Trustee Account") in the name of and
under the exclusive control of the Property Trustee on behalf of
the Holders of the Trust Securities and, upon the receipt of
payments of funds made in respect of the Subordinated Debentures
held by the Property Trustee, deposit such funds into the
Property Trustee Account and make Distributions to the Holders of
the Trust Securities from the Property Trustee Account in
accordance with Section 6.1. Funds in the Property Trustee
Account shall be held uninvested until disbursed in accordance
with this Declaration. The Property Trustee Account shall be an
account that is maintained with the Property Trustee or with a
banking institution the rating on whose long term unsecured
14
indebtedness is at least equal to the rating assigned to the
Preferred Securities by a "nationally recognized statistical
rating organization", as that term is defined for purposes of
Rule 436(g)(2) under the Securities Act;
(ii) engage in such ministerial activities as shall be
necessary or appropriate to effect the redemption of the Trust
Securities to the extent the Subordinated Debentures are redeemed
or mature; and
(iii) upon receipt of notice of distribution issued by the
Regular Trustees in accordance with the terms of the Trust
Securities, engage in such ministerial activities as shall be
necessary or appropriate to effect the distribution of the
Subordinated Debentures to Holders of Trust Securities upon the
occurrence of certain special events (as may be defined in the
terms of the Trust Securities) arising from a change in law or a
change in legal interpretation or other specified circumstances
pursuant to the terms of the Trust Securities.
(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 the Trust Securities.
(e) The Property Trustee shall take any Legal Action that arises out
of or in connection with an Event of Default or the Property Trustee's
duties and obligations under this Declaration or the Trust Indenture
Act.
(f) The Property Trustee shall not resign as a trustee unless either:
(i) the Trust has been completely liquidated and the proceeds
of such liquidation have been distributed to the Holders of Trust
Securities pursuant to the terms of the Trust Securities; or
(ii) a successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 5.6.
(g) The Property Trustee shall have the legal power to exercise all
of the rights, powers and privileges of a holder of Subordinated
Debentures under the Indenture and, if an Event of Default occurs and
is continuing, the Property Trustee shall, for the benefit of Holders
of the Trust Securities, enforce its rights as holder of the
Subordinated Debentures subject to the rights of the Holders pursuant
to the terms of such Trust 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 Trust
Securities and any such Paying Agent shall comply with Section 317(b)
of the Trust Indenture Act. The Property Trustee may remove any
Paying Agent at any time and a successor Paying Agent or additional
Paying Agents may be appointed at any time by the Property Trustee.
The Property Trustee will be the initial Paying Agent.
15
(i) Subject to this Section 3.8, the Property Trustee shall have none
of the duties, liabilities, powers or the authority of the Regular
Trustees set forth in Section 3.6.
The Property Trustee must 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 not take any
action that is inconsistent with the purposes and functions of the Trust set
out in Section 3.3.
Section 3.9 CERTAIN DUTIES AND RESPONSIBILITIES OF THE PROPERTY
TRUSTEE.
(a) The Property Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are
specifically set forth in this Declaration and no implied covenants
shall be read into this Declaration against the Property Trustee. In
case an Event of Default has occurred (that has not been cured or
waived pursuant to Section 2.6), the Property Trustee shall exercise
such of the rights and powers vested in it by this Declaration, and
use the same degree of care and skill in their exercise, as a prudent
person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(b) No provision of this Declaration shall be construed to relieve
the Property Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except
that:
(i) prior to the occurrence of an Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Property Trustee
shall be determined solely by the express provisions of
this Declaration, and the Property Trustee shall not be
liable except for the performance of such duties and
obligations as are specifically set forth in this
Declaration, and no implied covenants or obligations
shall be read into this Declaration against the Property
Trustee; and
(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively
rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Property
Trustee and conforming to the requirements of this
Declaration; but in the case of any such certificates or
opinions that by any provision hereof are specifically
required to be furnished to the Property Trustee, the
Property Trustee shall be under a duty to examine the
same to determine whether or not they conform to the
requirements of this Declaration;
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the
Property Trustee, unless it shall
16
be proved that the Property Trustee was negligent in ascertaining
the pertinent facts;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a
Majority in liquidation amount of the Trust Securities at the
time outstanding 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 Declaration;
(iv) no provision of this Declaration shall require the
Property Trustee to expend or risk its own funds or otherwise
incur personal financial liability in the performance of any of
its duties or in the exercise of any of its rights or powers, if
it shall have reasonable grounds for believing that the repayment
of such funds or liability is not reasonably assured to it under
the terms of this Declaration or adequate indemnity against such
risk or liability is not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the
custody, safekeeping and physical preservation of the
Subordinated Debentures and the Property Trustee 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 Declaration and the Trust Indenture
Act;
(vi) the Property Trustee shall have no duty or liability for
or with respect to the value, genuineness, existence or
sufficiency of the Subordinated Debentures or the payment of any
taxes or assessments levied thereon or in connection therewith;
(vii) the Property Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree with
the Sponsor. Money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the
Property Trustee Account maintained by the Property Trustee
pursuant to Section 3.8(c)(i) and except to the extent otherwise
required by law; and
(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Regular Trustees or the Sponsor
with their respective duties under this Declaration, nor shall
the Property Trustee be liable for the default or misconduct of
the Regular Trustees or the Sponsor.
Section 3.10 CERTAIN RIGHTS OF PROPERTY TRUSTEE.
(a) Subject to the provisions of Section 3.9:
17
(i) the Property Trustee may rely and shall be fully
protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed, sent or
presented by the proper party or parties;
(ii) any direction or act of the Sponsor or the Regular
Trustees contemplated by this Declaration shall be sufficiently
evidenced by a Direction or an Officer's Certificate;
(iii) whenever in the administration of this Declaration, the
Property Trustee shall deem it desirable that a matter be proved
or established before taking, suffering or omitting any action
hereunder, the Property Trustee (unless other evidence is herein
specifically prescribed) shall be entitled, in the absence of bad
faith on its part, to request and rely upon an Officer's
Certificate which, upon receipt of such request, shall be
promptly delivered by the Sponsor or the Regular Trustees;
(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including
any financing or continuation statement or any filing under tax
or securities laws) (or any re-recording, refiling or
registration thereof);
(v) the Property Trustee may consult with counsel or other
experts and the advice or opinion of such counsel and experts
with respect to legal matters or advice within the scope of such
experts' area of expertise 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
accordance with such advice or opinion. Such counsel may be
counsel to the Sponsor or any of its Affiliates, and may include
any of its employees. The Property Trustee shall have the right
at any time to seek instructions concerning the administration of
this Declaration from any court of competent jurisdiction;
(vi) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Declaration at the request or direction of any Holder, unless
such Holder shall have provided to the Property Trustee security
and indemnity, acceptable to the Property Trustee, against the
costs, expenses (including attorneys' fees and expenses) and
liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may
be requested by the Property Trustee provided that, nothing
contained in this Section 3.10(a)(vi) shall be taken to relieve
the Property Trustee, upon the occurrence of an Event of Default,
of its obligation to exercise the rights and powers vested in it
by this Declaration;
(vii) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, Officer's Certificate,
18
statement, instrument, opinion, Opinion of Counsel, report,
notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or
document, but the Property Trustee, in its discretion, may
make such further inquiry or investigation into such facts or
matters as it may see fit;
(viii) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly
or by or through agents or attorneys and the Property Trustee
shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it
hereunder;
(ix) any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders of the Trust
Securities, and the signature of the Property Trustee or its
agents alone shall be sufficient and effective to perform any
such action and no third party shall be required to inquire as to
the authority of the Property Trustee to so act or as to its
compliance with any of the terms and provisions of this
Declaration, both of which shall be conclusively evidenced by the
Property Trustee's or its agent's taking such action;
(x) whenever in the administration of this Declaration 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 Trust Securities which
instructions may only be given by the Holders of the same
proportion in liquidation amount of the Trust Securities as would
be entitled to direct the Property Trustee under the terms of the
Trust 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 acting in accordance with such
instructions; and
(xi) except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be under any
obligation to take any action that is discretionary under the
provisions of this Declaration.
No provision of this Declaration 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 Declaration other than Sections 5.2 and 8.1(b), the Delaware Trustee
shall not be entitled to exercise any powers nor shall the Delaware Trustee
have any of the duties and responsibilities of
19
the Regular Trustees or the Property Trustee described in this Declaration.
Except as set forth in Sections 5.2 and 8.1(b), the Delaware Trustee shall be
a Trustee for the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Business Trust Act. The Delaware Trustee shall be
entitled to the benefit of all of the immunities and indemnities that the
Property Trustee is entitled to under this Declaration.
Section 3.12 EXECUTION OF DOCUMENTS. Unless otherwise determined by
the Regular Trustees, and except as otherwise required by the Business Trust
Act, a majority of or, if there are only two, both of the Regular Trustees
are authorized to execute on behalf of the Trust any documents that the
Regular Trustees have the power and authority to execute pursuant to Section
3.6; provided that, any listing application prepared by the Sponsor referred
to in Section 4.2(c) may be executed by one Regular Trustee.
Section 3.13 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF TRUST
SECURITIES. The recitals contained in this Declaration and the Trust
Securities shall be taken as the statements of the Sponsor and the Trustees
do not assume any responsibility for their correctness. The Trustees make no
representations as to the value or condition of the property of the Trust or
any part thereof. The Trustees make no representations as to the validity or
sufficiency of this Declaration or the Trust Securities.
Section 3.14 DURATION OF TRUST. The Trust, unless terminated
pursuant to the provisions of Article VIII hereof, shall exist until December
31, 2053.
Section 3.15 MERGERS.
(a) The Trust may not consolidate, amalgamate, merge with or into, or
be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except
as described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of a majority of the Regular
Trustees and without the consent of the Holders of the Trust
Securities, the Delaware Trustee or the Property Trustee, consolidate,
amalgamate, merge with or into, or be replaced by a trust organized as
such under the laws of any State; PROVIDED THAT:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the
Trust under the Trust 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 with respect to Distributions
and payments upon liquidation, redemption and maturity;
20
(ii) the Sponsor expressly acknowledges a trustee of the
Successor Entity that possesses the same powers and duties as the
Property Trustee as the Holder of the Subordinated 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,
the Nasdaq Stock Market's National Market or other organization
on which the Preferred Securities are then listed;
(iv) such merger, consolidation, amalgamation or replacement
does not cause the Preferred Securities (including any Successor
Securities) to be downgraded by any nationally recognized
statistical rating organization;
(v) such merger, consolidation, amalgamation or replacement
does not adversely affect the rights, preferences and privileges
of the Holders of the Trust Securities (including any Successor
Securities) in any material respect;
(vi) such Successor Entity has a purpose identical to that of
the Trust;
(vii) prior to such merger, consolidation, amalgamation or
replacement, the Sponsor has received an opinion of a nationally
recognized independent counsel to the Trust experienced in such
matters to the effect that:
(A) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights,
preferences and privileges of the Holders of the Trust
Securities (including any Successor Securities) in any
material respect; and
(B) following such merger, consolidation, amalgamation
or replacement, neither the Trust nor the Successor
Entity will be required to register as an Investment
Company; and
(viii) the Sponsor guarantees the obligations of such Successor
Entity under the Successor Securities at least to the extent
provided by the Preferred Securities Guarantee.
(c) Notwithstanding Section 3.15(b), the Trust shall, except with the
consent of Holders of 100% in liquidation amount of the Trust
Securities, not consolidate, amalgamate, merge with or into, or be
replaced by any other entity or permit any other entity to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger or replacement would cause the
Trust or Successor Entity not to be classified for United States
federal income tax purposes as a grantor trust.
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ARTICLE IV
SPONSOR
Section 4.1 SPONSOR'S PURCHASE OF COMMON SECURITIES. On the Closing
Date, the Sponsor will purchase all the Common Securities issued by the
Trust, in an amount equal to 3% of the capital of the Trust, at the same time
as the Preferred Securities are sold.
Section 4.2 RESPONSIBILITIES OF THE SPONSOR. In connection with the
issuance and sale of the Preferred Securities, the Sponsor shall have the
exclusive right and responsibility to engage in the following activities:
(a) the preparation and filing by the Trust with the Commission and
the execution on behalf of the Trust of a registration statement on
Form S-3 in relation to the Preferred Securities and the Subordinated
Debentures, including any amendments thereto;
(b) the determination of the states in which to take appropriate
action to qualify or register for sale all or part of the Preferred
Securities and the determination of any and all such acts, other than
actions which must be taken by the Trust, and the advice to the Trust
of actions it must take, and the preparation 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;
(c) the preparation and filing by the Trust and the execution on
behalf of the Trust of an application to the New York Stock Exchange
or any other national stock exchange or the Nasdaq Stock Market's
National Market for listing upon notice of issuance of the Preferred
Securities;
(d) the preparation and filing by the Trust with the Commission and
the execution on behalf of the Trust of a registration statement on
Form 8-A relating to the registration of the Preferred Securities
under Section 12(b) or 12(g) of the Exchange Act, including any
amendments thereto;
(e) the negotiation of the terms of, and the execution and delivery
of, the Underwriting Agreement providing for the sale of the Preferred
Securities; and
(e) the taking of any other action necessary and desirable to carry
out the foregoing activities.
ARTICLE V
TRUSTEES
Section 5.1 NUMBER OF TRUSTEES. The number of Trustees shall
initially be four (4), and:
22
(a) at any time before the issuance of any Trust Securities, the
Sponsor may, by written instrument, increase or decrease the number of
Trustees; and
(b) after the issuance of any Trust 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, provided
that in any case, the number of Trustees shall be at least four (4)
unless the Trustee that acts as the Property Trustee also acts as the
Delaware Trustee pursuant to Section 5.2, in which case the number of
Trustees shall be at least three (3).
Section 5.2 DELAWARE TRUSTEE; ELIGIBILITY. If required by the
Business Trust Act, one Trustee shall be:
(a) a natural person who is at least 21 years of age and 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. Except as otherwise provided, the Delaware Trustee's
sole duty shall be to, upon the request of the other Trustees or the Sponsor,
execute any documents and maintain custody of any records required to form,
maintain the existence of, or dissolve, the Trust under the Business Trust Act.
Section 5.3 PROPERTY TRUSTEE; ELIGIBILITY.
(a) There shall at all times be one Trustee which shall act as
Property Trustee which shall:
(i) not be an Affiliate of the Sponsor;
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or
Person permitted by the Commission to act as an institutional
trustee under the Trust Indenture Act, authorized under such laws
to exercise corporate trust powers, having a combined capital and
surplus of at least 50 million U.S. dollars ($50,000,000), and
subject to supervision or examination by Federal, state,
Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of the supervising or
examining authority referred to above, then for the purposes of
this Section 5.3(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so
published.
23
(b) If at any time the Property Trustee shall cease to be eligible to
so act under Section 5.3(a), the Property Trustee shall immediately
resign in the manner and with the effect set forth in Section 5.6(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture
Act, the Property Trustee and the Holder of the Common Securities (as
if it were the obligor referred to in Section 310(b) of the Trust
Indenture Act) shall in all respects comply with the provisions of
Section 310(b) of the Trust Indenture Act.
(d) The Preferred Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause (i)
of the first provision contained in Section 310(b) of the Trust
Indenture Act.
Section 5.4 QUALIFICATIONS OF REGULAR TRUSTEES GENERALLY. Each
Regular Trustee shall be a natural person who is at least 21 years of age and
shall be an employee or officer of the Sponsor or otherwise be affiliated with
the Sponsor.
Section 5.5 INITIAL TRUSTEES. The initial Regular Trustees shall
be:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
The initial Delaware Trustee shall be:
Delaware Trust Capital Management, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The initial Property Trustee shall be:
IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Section 5.6 APPOINTMENT, REMOVAL AND RESIGNATION OF TRUSTEES.
(a) Subject to Section 5.6(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;
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(ii) after the issuance of any Trust Securities, except as
provided in clause (iii) hereof, 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 any Trust Securities, if an Event
of Default has occurred and is continuing, with respect only to
the Property Trustee or the Delaware Trustee, by vote of the
Holders of a Majority in liquidation amount of the Preferred
Securities voting as a class at a meeting of the Holders of the
Preferred Securities.
b) (i) The Trustee that acts as Property Trustee shall not be
removed in accordance with Section 5.6(a) until a successor
Property Trustee possessing the qualifications to act as Property
Trustee under Section 5.3 has been appointed and has accepted
such appointment by written instrument executed by such successor
Property Trustee and delivered to the Regular Trustees and the
Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall not be
removed in accordance with Section 5.6(a) until a successor
Trustee possessing the qualifications to act as Delaware Trustee
under Section 5.2 has been appointed and has accepted such
appointment by written instrument executed by such successor
Delaware Trustee and delivered to the Regular Trustees and the
Sponsor.
(c) A Trustee appointed to office shall hold office until his
successor shall have been appointed or until his death, removal or
resignation. Any Trustee may resign from office (without need for
prior or subsequent accounting) by any instrument in writing signed by
the Trustee and delivered to the Sponsor and the Trust, which
resignation shall take effect upon such delivery or upon such later
date as is specified therein; PROVIDED, HOWEVER, that:
(i) No such resignation of the Trustee that acts as the
Property Trustee shall be effective:
(A) until a successor Property Trustee has been
appointed and has accepted such appointment by instrument
executed by such successor Property Trustee and delivered
to the Trust, the Sponsor and the resigning Property
Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the
Holders of the Trust Securities; and
(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a successor Delaware
Trustee has been appointed and has accepted such appointment by
instrument executed by such successor
25
Delaware Trustee and delivered to the Trust, the Sponsor and the
resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best efforts
to promptly appoint a successor Delaware Trustee or successor Property
Trustee, as the case may be, as the Property Trustee or the Delaware
Trustee if the resigning Property Trustee or Delaware Trustee delivers
an instrument of resignation in accordance with this Section 5.6.
(e) If no successor Property Trustee or successor Delaware Trustee
shall have been appointed and accepted appointment as provided in this
Section 5.6 within 60 days after delivery to the Sponsor and the Trust
of an instrument of resignation, the resigning Property Trustee or
Delaware Trustee, as applicable, may petition any court of competent
jurisdiction for appointment of a successor Property Trustee or
successor Delaware Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a
successor Property Trustee or successor Delaware Trustee, as the case
may be.
Section 5.7 VACANCIES AMONG TRUSTEES. If a Trustee ceases to hold
office for any reason and the number of Trustees is not reduced pursuant to
Section 5.1, or if the number of Trustees is increased pursuant to Section 5.1,
a vacancy shall occur. A resolution certifying the existence of such vacancy by
a majority of the Regular Trustees shall be conclusive evidence of the existence
of such vacancy and copies of any such resolution shall be distributed promptly
to the remaining Trustees. The vacancy shall be filled with a Trustee appointed
in accordance with Section 5.6.
Section 5.8 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 the Trust. Whenever
a vacancy in the number of Regular Trustees shall occur, until such vacancy is
filled by the appointment of a Regular Trustee in accordance with Section 5.6,
the Regular Trustees in office, regardless of their number, shall have all the
powers granted to the Regular Trustees and shall discharge all the duties
imposed upon the Regular Trustees by this Declaration.
Section 5.9 MEETINGS. Meetings of the Regular Trustees shall be
held from time to time upon the call of any Regular Trustee. Regular meetings
of the Regular Trustees may be held at a time and place fixed by resolution of
the Regular Trustees. Notice of any in-person meetings of the Regular Trustees
shall be hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than 48 hours before
such meeting. Notice of any telephonic meetings of the Regular Trustees or any
committee thereof shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than 24
hours before a meeting. Notices shall contain a brief statement of the time,
place and anticipated purposes of the meeting. The presence (whether in person
or by telephone) of a Regular Trustee at a meeting shall constitute a waiver of
notice of such meeting except where a Regular 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 Declaration, any action of the
26
Regular Trustees may be taken at a meeting by vote of a majority of the
Regular 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 Regular Trustees.
Section 5.10 DELEGATION OF POWER.
(a) Any Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of
21 his or her power for the purpose of executing any documents
contemplated in Section 3.6, including any governmental filing; and
(b) the Regular 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 Regular Trustees or otherwise as the
Regular Trustees may deem expedient, to the extent such delegation is
not prohibited by applicable law or contrary to the provisions of the
Trust, as set forth herein.
ARTICLE VI
DISTRIBUTIONS
Section 6.1 DISTRIBUTIONS. Holders shall receive Distributions in
accordance with the applicable terms of Exhibit A hereto and the applicable
terms of the relevant Holder's Trust Securities. Distributions shall be made on
the Preferred Securities and the Common Securities in accordance with the
preferences set forth in their respective terms. If and to the extent that the
Sponsor makes a payment of interest (including Deferred Interest (as defined in
the Indenture)), and principal on the Subordinated 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 distribution (a "Distribution") of the Payment Amount to
Holders.
ARTICLE VII
ISSUANCE OF TRUST SECURITIES
Section 7.1 GENERAL PROVISIONS REGARDING TRUST SECURITIES.
(a) The Regular Trustees shall on behalf of the Trust issue one class
of preferred securities representing undivided beneficial interests in
the assets of the Trust having such terms as are set forth in Exhibit
A and incorporated herein by reference (the "Preferred Securities")
and one class of common securities representing undivided beneficial
interests in the assets of the Trust having such terms as are set
forth in Exhibit A and incorporated herein by reference (the "Common
Securities"). The Trust shall have no securities or other interests
in the assets of the Trust other than the Preferred Securities and the
Common Securities.
27
(b) The Regular Trustees (or if there are more than two Regular
Trustees by any two of the Regular Trustees) shall sign the
Certificates on behalf of the Trust. Such signatures may be the
manual or facsimile signatures of the present or any future Regular
Trustee. Typographical and other minor errors or defects in any such
reproduction of any such signature shall not affect the validity of
any Certificate. In case any Regular Trustee of the Trust who shall
have signed any of the Trust Securities shall cease to be such Regular
Trustee before the Certificates so signed shall be delivered by the
Trust, such Certificates nevertheless may be delivered as though the
person who signed such Certificates had not ceased to be such Regular
Trustee; and any Certificate may be signed on behalf of the Trust by
such persons who, at the actual date of execution of such Trust
Security, shall be the Regular Trustees of the Trust, although at the
date of the execution and delivery of this Declaration any such person
was not such a Regular Trustee. Certificates shall be printed,
lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as evidenced by their
execution thereof, and may have such letters, numbers or other marks
or identification or designation and such legends or endorsements as
the Regular Trustees may deem appropriate, or as may be required to
comply with any law or with any rule or regulation of any stock
exchange on which Trust Securities may be listed, or to conform to
usage.
(c) The consideration shall be received by the Property Trustee for
the issuance of the Trust Securities, which consideration shall
constitute a contribution to the capital of the Trust and shall not
constitute a loan to the Trust.
(d) The Holders shall not have any right or title in the assets of
the Trust other than an undivided beneficial interest in such assets
conferred by their Trust Securities, and they shall have no right to
call for any partition or division of any property, profits or rights
of the Trust except as otherwise provided herein. The Trust
Securities shall be personal property giving only the rights
specifically set forth therein and in this Declaration. The Trust
Securities, when issued and delivered against payment of purchase
price therefor, shall be deemed to be validly issued, fully paid and
non-assessable by the Trust.
(e) Every Person, by virtue of having become a Holder or a Preferred
Security Beneficial Owner in accordance with the terms of this
Declaration, shall be deemed to have expressly assented and agreed to
the terms of, and shall be bound by, this Declaration.
ARTICLE VIII
TERMINATION
Section 8.1 TERMINATION OF TRUST.
(a) The Trust shall terminate on the earlier of December 31, 2053 or:
28
(i) upon (x) the filing of a bankruptcy petition pursuant to
11 U.S.C. Sections 101 ET. SEQ. or similar petition arising under
the laws of any other jurisdiction by the Holder of the Common
Securities or the Sponsor or (y) the insolvency of the Holder of
the Common Securities or the Sponsor;
(ii) upon the filing of a certificate of dissolution or its
equivalent with respect to the Holder of the Common Securities or
the Sponsor; the filing of a certificate of cancellation with
respect to the Trust or the revocation of the Holder of the
Common Securities or the Sponsor's charter and the expiration of
90 days after the date of revocation without a reinstatement
thereof;
(iii) upon the entry of a decree of judicial dissolution of the
Holder of the Common Securities, the Sponsor or the Trust;
(iv) when all of the Trust Securities shall have been called
for redemption and the amounts necessary for redemption thereof
shall have been paid to the Holders in accordance with the terms
of the Trust Securities; and
(v) upon delivery of written direction to the Property
Trustee by the Sponsor at any time (which direction is wholly
optional and within the discretion of the Sponsor) to dissolve
the Trust and distribute the Subordinated Debentures to the
Holders of the Trust Securities in accordance with Section 3 of
Exhibit A.
(b) As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a), the Delaware Trustee shall file a
certificate of cancellation with the Secretary of State of the State
of Delaware.
(c) The provisions of Section 3.9 and Article X shall survive the
termination of the Trust.
ARTICLE IX
TRANSFER OF INTEREST
Section 9.1 TRANSFER OF TRUST SECURITIES.
(a) Trust Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Declaration
and in the terms of the Trust Securities. Any transfer or purported
transfer of any Trust Security not made in accordance with this
Declaration shall be null and void.
(b) Subject to this Article IX, Preferred Securities shall be freely
transferable.
(c) Subject to this Article IX, the Sponsor and any Related Party may
only transfer Common Securities to the Sponsor or a Related Party of
the Sponsor; PROVIDED THAT, any such transfer is subject to the
conditions precedent that the
29
transferor obtain the written opinion of nationally recognized
independent counsel experienced in such matters that such transfer
would not cause more than an insubstantial risk that:
(i) the Trust would not be classified for United States
federal income tax purposes as a grantor trust; and
(ii) the Trust would be an Investment Company or the
transferee would become an Investment Company.
Section 9.2 TRANSFER OF CERTIFICATES. The Regular Trustees shall
provide for the registration of transfers of Certificates, which will be
effected without charge, but only upon payment (with such indemnity as the
Regular Trustees may require) in respect of any tax or other governmental
charges that may be imposed in relation to it. Upon surrender for
registration of transfer of any Certificate, the Regular Trustees shall cause
one or more new Certificates to be issued in the name of the designated
transferee or transferees. Every Certificate surrendered for registration of
transfer shall be accompanied by a written instrument of transfer in form
satisfactory to the Regular Trustees duly executed by the Holder or such
▇▇▇▇▇▇'s attorney duly authorized in writing. Each Certificate surrendered
for registration of transfer shall be canceled by the Regular Trustees. A
transferee of a Certificate shall be entitled to the rights and subject to
the obligations of a Holder hereunder upon the receipt by such transferee of
a Certificate. By acceptance of a Certificate, each transferee shall be
deemed to have agreed to be bound by this Declaration and the documents
incorporated by reference herein.
Section 9.3 DEEMED TRUST SECURITY HOLDERS. The Trustees may treat
the Person in whose name any Certificate shall be registered on the books and
records of the Trust as the sole holder of such Certificate and of the Trust
Securities represented by such Certificate for purposes of receiving
Distributions and for all other purposes whatsoever and, accordingly, shall
not be bound to recognize any equitable or other claim to or interest in such
Certificate or in the Trust Securities represented by such Certificate on the
part of any Person, whether or not the Trust shall have actual or other
notice thereof.
Section 9.4 BOOK-ENTRY INTERESTS. Unless otherwise specified in
the terms of the Preferred Securities, the Preferred Securities Certificates,
on original issuance, will be issued in the form of one or more fully
registered global Preferred Security Certificates (each, a "Global
Certificate"), to be delivered to DTC, the initial Depositary, or its
custodian, by, or on behalf of, the Trust. Such Global Certificates shall
initially be registered on the books and records of the Trust in the name of
Cede & Co., the nominee of DTC, and no Preferred Security Beneficial Owner
will receive a Definitive Preferred Security Certificate representing such
Preferred Security Beneficial Owner's interests in such Global Certificates,
except as provided in Section 9.7. Unless and until definitive, fully
registered Preferred Security Certificates (the "Definitive Preferred
Security Certificates") have been issued to the Preferred Security Beneficial
Owners pursuant to Section 9.7:
(a) the provisions of this Section 9.4 shall be in full force and
effect;
30
(b) the Trust and the Trustees shall be entitled to deal with the
Depositary for all purposes of this Declaration (including the payment
of Distributions on the Global Certificates and receiving approvals,
votes or consents hereunder) as the Holder of the Preferred Securities
and the sole holder of the Global Certificates and shall have no
obligation to the Preferred Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.4 conflict
with any other provisions of this Declaration, the provisions of this
Section 9.4 shall control; and
(d) the rights of the Preferred Security Beneficial Owners shall be
exercised only through the Depositary and shall be limited to those
established by law and agreements between such Preferred Security
Beneficial Owners and the Depositary and/or the Depositary
Participants. DTC will make book-entry transfers among the Depositary
Participants and receive and transmit payments of Distributions on the
Global Certificates to such Depositary Participants.
Section 9.5 NOTICES TO DEPOSITARY. Whenever a notice or other
communication to the Preferred Security Holder is required under this
Declaration, unless and until Definitive Preferred Security Certificates
shall have been issued to the Preferred Security Beneficial Owners pursuant
to Section 9.7, the Regular Trustees shall give all such notices and
communications specified herein to be given to the Preferred Security Holders
to the Depositary, and shall have no notice obligations to the Preferred
Security Beneficial Owners.
Section 9.6 APPOINTMENT OF SUCCESSOR DEPOSITARY. If any Depositary
elects to discontinue its services as securities depositary with respect to
the Preferred Securities, the Regular Trustees may, in their sole discretion,
appoint a successor Depositary with respect to such Preferred Securities.
Section 9.7 DEFINITIVE PREFERRED SECURITY CERTIFICATES. If:
(a) a Depositary elects to discontinue its services as securities
depositary with respect to the Preferred Securities and a successor
Depositary is not appointed within 90 days after such discontinuance
pursuant to Section 9.6;
(b) the Regular Trustees elect after consultation with the Sponsor to
terminate the book-entry system through the Depositary with respect to
the Preferred Securities; or
(c) an Event of Default has occurred and a Majority in liquidation
amount of the Preferred Securities determined to discontinue the
book-entry system through the Depositary with respect to the
Preferred Securities.
then:
(d) Definitive Preferred Security Certificates shall be prepared by
the Regular Trustees on behalf of the Trust with respect to such
Preferred Securities; and
31
(e) upon surrender of the Global Certificates by the Depositary,
accompanied by registration instructions, the Regular Trustees shall
cause Definitive Preferred Security Certificates to be delivered to
Preferred Security Beneficial Owners in accordance with the
instructions of the Depositary. Neither the Trustees nor the Trust
shall be liable for any delay in delivery of such instructions and
each of them may conclusively rely on and shall be protected in
relying on, said instructions of the Depositary. The Definitive
Preferred Security Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably
acceptable to the Regular Trustees, as evidenced by their execution
thereof, and may have such letters, numbers or other marks of
identification or designation and such legends or endorsements as the
Regular Trustees may deem appropriate, or as may be required to comply
with any law or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange on which Preferred
Securities may be listed, or to conform to usage.
Section 9.8 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If:
(a) any mutilated Certificates should be surrendered to the Regular
Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such security or
indemnity as may be required by them to keep each of them harmless,
then in the absence of notice that such Certificate shall have been acquired
by a bona fide purchaser, any two Regular Trustees on behalf of the Trust
shall execute and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like
denomination. In connection with the issuance of any new Certificate under
this Section 9.8, the Regular Trustees may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in connection therewith. Any duplicate Certificate issued pursuant to this
Section shall constitute conclusive evidence of an ownership interest in the
relevant Trust Securities, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time.
ARTICLE X
LIMITATION OF LIABILITY OF HOLDERS
OF TRUST SECURITIES, TRUSTEES OR OTHERS
Section 10.1 LIABILITY.
(a) Except as expressly set forth in this Declaration, the Preferred
Securities Guarantee, the Common Securities Guarantee and the terms of
the Trust Securities, the Sponsor shall not be:
32
(i) personally liable for the return of any portion of the
capital contributions (or any return thereon) of the Holders of
the Trust Securities which shall be made solely from assets of
the Trust; and
(ii) required to pay to the Trust or to any Holder of Trust
Securities any deficit upon dissolution of the Trust or
otherwise.
(b) Pursuant to Section 3803(a) of the Business Trust Act:
(i) the Holder of the Common Securities shall be liable for
all of the debts and obligations of the Trust (other than with
respect to the Trust Securities) to the extent not satisfied out
of the Trust's assets; and
(ii) 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 10.2 EXCULPATION.
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission
performed or omitted by such Indemnified Person in good faith on
behalf of the Trust and in a manner such Indemnified Person reasonably
believed to be within the scope of the authority conferred on such
Indemnified Person by this Declaration or by law, except that an
Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's gross negligence (or,
in the case of the Property Trustee, negligence) or willful misconduct
with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information,
opinions, reports or statements presented to the Trust by any Person
as to matters the Indemnified Person reasonably believes are within
such other Person's professional or expert competence and who has been
selected with reasonable care by or on behalf of the Trust, including
information, opinions, reports or statements as to the value and
amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which
Distributions to Holders of Trust Securities might properly be paid.
Section 10.3 FIDUCIARY DUTY.
(a) To the extent that, at law or in equity, an Indemnified Person
has duties (including fiduciary duties) and liabilities relating
thereto to the Trust or to any other Covered Person, an Indemnified
Person acting under this Declaration shall not be liable to the Trust
or to any other Covered Person for its good faith reliance on the
provisions of this Declaration. The provisions of this Declaration,
to the
33
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 Trust
Indenture Act), 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
an Indemnified Person and any Covered Person; or
(ii) whenever this Declaration 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 Trust
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 this Indemnified Person shall
not constitute a breach of this Declaration or any other
agreement contemplated herein or of any duty or obligation of the
Indemnified Person at law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted
or required to make a decision:
(i) in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to consider
such interests and factors as it desires, including its own
interests, and shall have no duty or obligation to give any
consideration to any interest of or factors affecting the Trust
or any other Person; or
(ii) in its "good faith" or under another express standard,
the Indemnified Person shall act under such express standard and
shall not be subject to any other or different standard imposed
by this Declaration or by applicable law.
Section 10.4 INDEMNIFICATION.
(a) To the fullest extent permitted by applicable law, the Sponsor
shall indemnify and hold harmless each Indemnified Person from and
against any loss, damage, liability, tax, penalty, expense or claim of
any kind or nature whatsoever incurred by such Indemnified Person by
reason of the creation, operation or termination of the Trust or 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 authority
34
conferred on such Indemnified Person by this Declaration, except that
no Indemnified Person shall be entitled to be indemnified in respect
of any loss, damage or claim incurred by such Indemnified Person by
reason of gross negligence (or, in the case of the Property Trustee,
negligence) or willful misconduct with respect to such acts or
omissions.
(b) To the fullest extent permitted by applicable law, expenses
(including legal fees) incurred by an Indemnified Person in defending
any claim, demand, action, suit or proceeding shall, from time to
time, be advanced by the Sponsor prior to the final disposition of
such claim, demand, action, suit or proceeding upon receipt by the
Sponsor of an undertaking by or on behalf of the Indemnified Person to
repay such amount if it shall be determined that the Indemnified
Person is not entitled to be indemnified as authorized in Section
10.4(a). The indemnification shall survive the termination of this
Declaration or the earlier removal or resignation of any of the
Trustees or the Property Trustee.
Section 10.5 OUTSIDE BUSINESSES. 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 business of the
Trust, and the Trust and the Holders of Trust Securities shall have no rights
by virtue of this Declaration in and to such independent ventures or the
income or profits derived therefrom and the pursuit of any such venture, even
if competitive with the business 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 XI
ACCOUNTING
Section 11.1 FISCAL YEAR. The fiscal year ("Fiscal Year") of the
Trust shall be the calendar year, or such other year as is required by the
Code.
Section 11.2 CERTAIN ACCOUNTING MATTERS.
(a) At all times during the existence of the Trust, the Regular
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.
35
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 by a firm of independent certified
public accountants selected by the Regular Trustees.
(b) The Regular Trustees shall cause to be prepared and delivered to
each of the Holders of Trust 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 Regular Trustees shall cause to be duly prepared and
delivered to each of the Holders of Trust Securities any United States
federal income tax information statement required by the Code,
containing such information with regard to the Trust Securities held
by each Holder as is required by the Code and the Treasury
Regulations, and any comparable statements required to be provided
under the law of any other taxing jurisdiction. Notwithstanding any
right under the Code or other law to deliver any such statement at a
later date, the Regular Trustees shall endeavor to deliver all such
statements within 30 days after the end of each Fiscal Year of the
Trust.
(d) The Regular Trustees shall cause to be duly prepared and filed
with the appropriate taxing authority an annual United States federal
income tax return Form 1041 or such other form required by United
States federal income tax law, and any other tax returns or reports
required to be filed by the Regular Trustees on behalf of the Trust
with any state or local taxing authority.
Section 11.3 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 Subordinated Debentures held by the Property Trustee shall be
made directly to the Property Trustee Account and no other funds of
the Trust shall be deposited in the Property Trustee Account. The
sole signatories for such accounts shall be designated by the
Regular Trustees; PROVIDED, HOWEVER, that the Property Trustee
shall designate the sole signatories for the Property Trustee
Account.
Section 11.4 WITHHOLDING. The Trust and the Regular
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 Regular 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 claimed over withholding, Holders shall be
limited to an action against the applicable jurisdiction. If the
36
amount required to be withheld was not withheld from actual Distributions
made to any Holder, the Trust may reduce subsequent Distributions to such
Holder by the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
Section 12.1 AMENDMENTS.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Trust Securities, this Declaration may only be
amended by a written instrument approved and executed by the Regular
Trustees (or, if there are more than two Regular Trustees a majority
of the Regular Trustees); PROVIDED, HOWEVER, that:
(i) in the case of any proposed amendment, the Property
Trustee shall have first received an Officer's Certificate from
each of the Regular Trustees on behalf of the Trust and the
Sponsor that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Trust
Securities);
(ii) in the case of any proposed amendment which affects the
rights, powers, duties, obligations or immunities of the Property
Trustee, the Property Trustee shall have first received:
(A) an Officer's Certificate from each of the Regular
Trustees on behalf of the Trust and the Sponsor that such
amendment is permitted by, and conforms to, the terms of
this Declaration (including the terms of the Trust
Securities); and
(B) an opinion of counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is permitted
by, and conforms to, the terms of this Declaration
(including the terms of the Trust Securities);
(iii) no amendment shall be made, and any such purported
amendment shall be void and ineffective, to the extent the result
of such amendment would be to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States federal income
taxation as a grantor trust and each Holder of the Trust
Securities not to be treated as owning an undivided
beneficial interest in the Subordinated Debentures, as
evidenced by an Opinion of Counsel to the effect that
such amendment shall not result in the foregoing;
37
(B) reduce or otherwise adversely affect the powers of
the Property Trustee in contravention of the Trust
Indenture Act; or
(C) cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment
Company Act;
(iv) at such time after the Trust has issued any Trust
Securities that remain outstanding, any amendment that would
adversely affect the rights, privileges or preferences of any
Holder of the Trust Securities may be effected only with such
additional requirements as may be set forth in the terms of such
Trust Securities;
(v) Section 9.1(c) and this Section 12.1 shall not be amended
without the consent of all of the Holders of the Trust
Securities;
(vi) Article IV shall not be amended without the consent of
the Holders of a Majority in liquidation amount of the Common
Securities; and
(vii) the rights of the holders of the Common Securities under
Article V 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.
(b) Notwithstanding Section 12.1(a)(iii), this Declaration may be
amended without the consent of the Holders of the Trust Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this Declaration
that may be defective or inconsistent with any other provision of
this Declaration;
(iii) add to the covenants, restrictions or obligations of the
Sponsor; and
(iv) conform to any change in Rule 3a-5 or other exemption
from the requirement to register as an Investment Company under
the Investment Company Act or written change in the
interpretation or application thereof by any legislative body,
court, government agency or regulatory authority which amendment
does not have a material adverse effect on the rights,
preferences or privileges of the Holders.
(c) Notwithstanding any other provision of this Declaration, neither
the Property Trustee nor the Delaware Trustee shall be required to
enter into any amendment to this Declaration which affects its own
rights, duties or immunities under this Declaration:
Section 12.2 MEETINGS OF THE HOLDERS OF TRUST SECURITIES; ACTION BY
WRITTEN CONSENT.
(a) Meetings of the Holders of any class of Trust Securities may be
called at any
38
time by the Regular Trustees (or as provided in the terms of the
Trust Securities) to consider and act on any matter on which
Holders of such class of Trust Securities are entitled to act under
the terms of this Declaration, the terms of the Trust Securities or
the rules of any stock exchange, the Nasdaq Stock Market's National
Market or other organization on which the Preferred Securities are
listed or admitted for trading. The Regular 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
Trust Securities. Such direction shall be given by delivering to
the Regular Trustees one or more calls in a writing stating that
the signing Holders of Trust Securities wish to call a meeting and
indicating the general or specific purpose for which the meeting is
to be called. Any Holders of Trust Securities calling a meeting
shall specify in writing the Certificates held by the Holders of
Trust Securities exercising the right to call a meeting and only
those Trust 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 Trust
Securities, the following provisions shall apply to meetings of
Holders of Trust Securities:
(i) notice of any such meeting shall be given to all the
Holders of Trust 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
Trust Securities is permitted or required under this Declaration
or the rules of any stock exchange, the Nasdaq Stock Market's
National Market or other organization on which the Preferred
Securities are listed or admitted for trading, such vote, consent
or approval may be given at a meeting of the Holders of Trust
Securities. Any action that may be taken at a meeting of the
Holders of Trust Securities may be taken without a meeting if a
consent in writing setting forth the action so taken is signed by
the Holders of Trust Securities owning not less than the minimum
amount of Trust Securities in liquidation amount that would be
necessary to authorize or take such action at a meeting at which
all Holders of Trust 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 Trust
Securities entitled to vote who have not consented in writing.
The Regular Trustees may specify that any written ballot
submitted to a Holder for the purpose of taking any action
without a meeting shall be returned to the Trust within the time
specified by the Regular Trustees;
(ii) each Holder of a Trust Security may authorize any Person
to act for it by proxy on all matters in which a Holder of Trust
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 Trust
Securities executing it. Except as otherwise provided herein,
all matters relating to the
39
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 Trust
Securities were stockholders of a Delaware corporation;
(iii) each meeting of the Holders of the Trust Securities shall
be conducted by the Regular Trustees or by such other Person that
the Regular Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration, the
terms of the Trust Securities, the Trust Indenture Act or the
listing rules of any stock exchange, the Nasdaq Stock Market's
National Market or other organization on which the Preferred
Securities are then listed or trading, otherwise provides, the
Regular Trustees, in their sole discretion, shall establish all
other provisions relating to meetings of Holders of Trust
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
Trust 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.
ARTICLE XIII
REPRESENTATIONS AND WARRANTIES OF
PROPERTY TRUSTEE AND DELAWARE TRUSTEE
Section 13.1 REPRESENTATIONS AND WARRANTIES OF PROPERTY TRUSTEE. The
Property Trustee represents and warrants to the Trust and to the Sponsor at the
date of this Declaration, and each successor Property Trustee represents and
warrants to the Trust and the Sponsor at the time of its acceptance of its
appointment as Property Trustee that:
(a) The Property Trustee is a banking corporation with trust powers,
duly organized, validly existing and in good standing under the laws
of the State of New York, with trust power and authority to execute
and deliver, and to carry out and perform its obligations under the
terms of, this Declaration and with its principal place of business in
New York.
(b) The execution, delivery and performance by the Property Trustee
of this Declaration have been duly authorized by all necessary
corporate action on the part of the Property Trustee. This
Declaration has been duly executed and delivered by the Property
Trustee, and, assuming due authorization, execution and delivery
hereof by the other parties hereto, 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
40
principles of equity and the discretion of the court (whether
considered in a proceeding in equity or at law).
(c) The execution, delivery and performance of this Declaration by
the Property Trustee do not conflict with or constitute a breach of
the charter or by-laws of the Property Trustee.
(d) The Property Trustee, pursuant to this Declaration, shall hold
legal title and a valid ownership interest in the Subordinated
Debentures in accordance with the provisions hereof.
Section 13.2 REPRESENTATIONS AND WARRANTIES OF DELAWARE TRUSTEE. The
Delaware Trustee represents and warrants to the Trust and to the Sponsor at the
date of this Declaration, and each successor Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the time of its acceptance of its
appointment as Delaware Trustee that:
(a) The Delaware Trustee is either a natural person who is at least
21 years of age and a resident of the State of Delaware or, if not a
natural person, an entity which has its principal place of business in
the State of Delaware.
(b) The execution, delivery and performance by the Delaware Trustee
of this Declaration and the Certificate of Trust have been duly
authorized by all necessary corporate action on the part of the
Delaware Trustee. This Declaration has been duly executed and
delivered by the Delaware Trustee and, under Delaware law assuming due
authorization, execution and delivery hereof by the other parties
hereto, 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 (whether considered in a proceeding in equity or at law).
(c) The execution, delivery and performance of this Declaration and
the Certificate of Trust by the Delaware Trustee do not conflict with
or constitute a breach of the charter or by-laws of the Delaware
Trustee.
ARTICLE XIV
MISCELLANEOUS
Section 14.1 NOTICES. All notices, instructions, requests and
demands provided for in this Declaration shall be in writing, duly signed by the
party giving same, and shall be delivered, telecopied or mailed by registered or
certified mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the
Trust's mailing address set forth below (or such other address as the
Trust may give notice of to the Holders of the Trust Securities):
41
NVP Capital III
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if given to the Property Trustee, at the mailing address set
forth below (or such other address as the Property Trustee may give
notice of to the Holders of the Trust Securities):
IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
(c) if given to the Delaware Trustee, at the mailing address set
forth below (or such other address as the Delaware Trustee may give
notice of to the Holders of the Trust Securities):
Delaware Trust Capital Management, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice of to the Trust):
Nevada Power Company
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telecopy number: (▇▇▇) ▇▇▇-▇▇▇▇
(e) if given to any other Holder, at the address set forth on the
books and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
Section 14.2 GOVERNING LAW. This Declaration and the rights of the
parties hereunder shall be governed by and interpreted in accordance with the
laws of the State of Delaware and all rights and remedies shall be governed by
such laws without regard to principles of conflict of laws.
42
Section 14.3 INTENTION OF THE PARTIES. It is the intention of the
parties hereto that the Trust not be characterized for United States federal
income tax purposes as an association taxable as a corporation or a partnership
but rather that the Trust be characterized as a grantor trust or otherwise in a
manner such that each Holder of Trust Securities will be treated as owning an
undivided beneficial interest in the Subordinated Debentures. The provisions of
this Declaration shall be interpreted to further this intention of the parties.
Section 14.4 HEADINGS. Headings contained in this Declaration are
inserted for convenience of reference only and do not affect the interpretation
of this Declaration or any provision hereof.
Section 14.5 SUCCESSORS AND ASSIGNS. Whenever in this Declaration
any of the parties hereto is named or referred to, the successors and assigns of
such party shall be deemed to be included, and all covenants and agreements in
this Declaration by the Sponsor and the Trustees shall bind and inure to the
benefit of their respective successors and assigns, whether so expressed.
Section 14.6 PARTIAL ENFORCEABILITY. If any provision of this
Declaration, or the application of such provision to any Person or circumstance,
shall be held invalid, the remainder of this Declaration, or the application of
such provision to persons or circumstances other than those to which it is held
invalid, shall not be affected thereby.
Section 14.7 COUNTERPARTS. This Declaration may contain more than
one counterpart of the signature page and this Declaration may be executed by
the affixing of the signature of each of the Trustees and the Property Trustee
to one of such counterpart signature pages. All of such counterpart signature
pages shall be read as though one, and they shall have the same force and effect
as though all of the signers had signed a single signature page.
43
IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
as Regular Trustee
---------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
as Regular Trustee
---------------------------------------
DELAWARE TRUST CAPITAL MANAGEMENT, INC.,
as Delaware Trustee
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
NEVADA POWER COMPANY,
as Sponsor
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
IBJ ▇▇▇▇▇▇▇▇ BANK & TRUST COMPANY,
as Property Trustee
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
EXHIBIT A
TERMS OF
_____% TRUST ISSUED PREFERRED SECURITIES
_____% TRUST ISSUED COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated Declaration of Trust,
dated as of ________, 1998 (as amended from time to time, the "Declaration"),
the designation, rights, privileges, restrictions, preferences and other terms
and provisions of the Preferred Securities and the Common Securities are set out
below (each capitalized term used but not defined herein has the meaning set
forth in the Declaration or, if not defined in such Declaration, as defined in
the Prospectus referred to below):
1. DESIGNATION AND NUMBER.
(a) PREFERRED SECURITIES. 2,800,000 Preferred Securities of the Trust with
an aggregate liquidation amount with respect to the assets of the Trust of
seventy million dollars ($70,000,000) and a liquidation amount with respect to
the assets of the Trust of $25 per Preferred Security, are hereby designated for
the purposes of identification only as "_____% Trust Issued Preferred
Securities" (the "Preferred Securities"). The Certificates evidencing the
Preferred Securities shall be substantially in the form attached hereto as Annex
I, with such changes and additions thereto or deletions therefrom as may be
required by ordinary usage, custom or practice or to conform to the rules of any
stock exchange on which the Preferred Securities are listed.
(b) COMMON SECURITIES. 86,598 Common Securities of the Trust with an
aggregate liquidation amount with respect to the assets of the Trust of two
million one hundred sixty-four thousand nine hundred and fifty dollars
($2,164,950) and a liquidation amount with respect to the assets of the Trust of
$25 per Common Security, are hereby designated for the purposes of
identification only as "_____% Trust Issued Common Securities" (the "Common
Securities"). The Certificates evidencing the Common Securities shall be
substantially in the form attached hereto as Annex II, with such changes and
additions thereto or deletions therefrom as may be required by ordinary usage,
custom or practice.
2. DISTRIBUTIONS.
(a) Distributions payable on each Trust Security will be fixed at a
rate per annum of _____% (the "Coupon Rate") of the stated liquidation amount
of $25 per Trust Security, such rate being the rate of interest payable on
the Subordinated Debentures to be held by the Property Trustee.
Distributions in arrears for more than one quarter will bear interest thereon
compounded quarterly at the Coupon Rate (to the extent permitted by
applicable law). The term "Distributions" as used herein includes such cash
distributions and any such interest payable unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect
of the Subordinated Debentures held by the Property Trustee. The amount of
Distributions payable for any period will be computed for any full quarterly
Distribution period on the basis of a 360-day year of twelve 30-day months,
and for any period shorter than a full quarterly Distribution period for
which Distributions are computed, Distributions will be computed on the basis
of the actual number of days elapsed per 30-day month.
A-1
(b) Distributions on the Trust Securities will be cumulative, will
accumulate from ________, 1998, and will be payable quarterly in arrears, on
March 31, June 30, September 30, and December 31 of each year, commencing on
December 31, 1998, except as otherwise described below. The Sponsor has the
right under the Indenture to defer payments of interest by extending the
interest payment period from time to time on the Subordinated Debentures for
a period not exceeding 20 consecutive quarters (each, an "Extension Period")
and, during such Extension Period, Distributions will also be deferred.
Despite such deferral, quarterly Distributions will continue to accumulate
with interest thereon (to the extent permitted by applicable law) at the
Coupon Rate compounded quarterly during any such Extension Period. Prior to
the termination of any such Extension Period, the Sponsor may further extend
such Extension Period; PROVIDED THAT such Extension Period together with all
such previous and further extensions thereof may not exceed 20 consecutive
quarters and, in any event, may not extend beyond the Maturity Date (as
defined in the Indenture). Payments of accumulated Distributions will be
payable to Holders as they appear on the books and records of the Trust on
the first record date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due,
the Sponsor may commence a new Extension Period, subject to the above
requirements.
(c) Distributions on the Trust Securities will be payable to the
Holders thereof as they appear on the books and records of the Trust on the
relevant record dates. While the Preferred Securities are represented by
Global Certificates, the relevant record dates shall be one Business Day
prior to the relevant payment dates which payment dates correspond to the
interest payment dates on the Subordinated Debentures. Subject to any
applicable laws and regulations and the provisions of the Declaration, as
long as the Preferred Securities are represented by Global Certificates, each
such payment in respect of the Preferred Securities will be made as described
under the heading "Description of the Preferred Securities--Book-Entry Only
Issuance--The Depository Trust Company" in the Prospectus dated _______, 1998
(the "Prospectus"), of the Trust included in the Registration Statement on
Form S-3 of the Sponsor and the Trust. The relevant record dates for the
Common Securities shall be the same record dates as for the Preferred
Securities. If the Preferred Securities shall not continue to be represented
by Global Certificates, the relevant record dates for the Preferred
Securities shall conform to the rules of any securities exchange on which the
securities are listed and, if none, shall be selected by the Regular
Trustees, which dates shall be at least 15 Business Days but less than 60
Business Days before the relevant payment dates, which payment dates
correspond to the interest payment dates on the Subordinated Debentures, and
distributions will be payable at the Corporate Trust Office of the Property
Trustee. Distributions payable on any Trust Securities that are not
punctually paid on any Distribution payment date, as a result of the Sponsor
having failed to make a payment under the Subordinated Debentures, will cease
to be payable to the Person in whose name such Trust Securities are
registered on the relevant record date, and such Distribution will instead be
payable to the Person in whose name such Trust Securities are registered on
the special record date or other specified date determined in accordance with
the Indenture. If any date on which Distributions are payable on the Trust
Securities is not a Business Day, then payment of the Distribution payable on
such date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay) except
that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date.
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(d) In the event that there is any money or other property held by or for
the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata (as defined herein) among the Holders of the Trust
Securities.
3. LIQUIDATION DISTRIBUTION UPON DISSOLUTION.
In the event of any voluntary or involuntary liquidation, dissolution,
winding-up or termination of the Trust, the Holders of the Trust Securities
on the date of the liquidation, dissolution, winding-up or termination, as
the case may be, will be entitled to receive out of the assets of the Trust
available for distribution to Holders of Trust Securities after satisfaction
of liabilities to creditors of the Trust an amount equal to the aggregate of
the stated liquidation amount of $25 per Trust Security plus accumulated and
unpaid Distributions thereon (including interest thereon) to the date of
payment (such amount being the "Liquidation Distribution"), unless, in
connection with such liquidation, dissolution, winding-up or termination,
Subordinated Debentures in an aggregate principal amount equal to the
aggregate stated liquidation amount of such Trust Securities shall be
distributed on a Pro Rata basis to the Holders of the Trust Securities in
exchange for such Trust Securities.
If, upon any such liquidation, dissolution, winding-up or termination,
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 Trust
Securities shall be paid on a Pro Rata basis. The holders of the Common
Securities will be entitled to receive distributions upon any such
dissolution Pro Rata with the holders of the Preferred Securities, except
that if an Event of Default has occurred and is continuing, the Preferred
Securities shall have a preference over the Common Securities with regard to
such distributions.
On and from the date fixed by the Regular Trustees for any distribution
of Subordinated Debentures and dissolution of the Trust: (i) the Trust
Securities will no longer be deemed to be outstanding, (ii) the Depositary,
as the Holder of the Preferred Securities, will receive a registered global
certificate representing the Subordinated Debentures to be delivered upon
such distribution, and (iii) any certificates representing Trust Securities
not held by the Depositary or its nominee (or any successor depositary or its
nominee), will be deemed to represent beneficial interests in the
Subordinated Debentures having an aggregate principal amount equal to the
aggregate stated liquidation amount of, with an interest rate identical to
the Coupon Rate of, and accrued and unpaid interest equal to accumulated and
unpaid Distributions on, such Trust Securities until such certificates are
presented to the Sponsor or its agent for transfer or reissue.
If the Subordinated Debentures are distributed to holders of the Trust
Securities, pursuant to the terms of the Indenture, the Sponsor will use its
best efforts to have the Subordinated Debentures listed on the New York Stock
Exchange or on such other exchange, the Nasdaq Stock Market's National Market
or other organization as the Preferred Securities were listed immediately
prior to the distribution of the Subordinated Debentures.
4. REDEMPTION; REDEMPTION/DISTRIBUTION PROCEDURES.
(a) Upon the repayment of the Subordinated Debentures, whether at the
Maturity Date or upon redemption thereof, in whole or in part, the proceeds from
such repayment or redemption
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shall be simultaneously applied to redeem Trust Securities having an
aggregate liquidation amount equal to the aggregate principal amount of the
Subordinated Debentures so repaid or redeemed at a redemption price of $25
per Trust Security plus an amount equal to accumulated and unpaid
Distributions thereon at the date of the redemption, payable in cash (the
"Redemption Price"). Holders will be given not less than 30 nor more than 60
days notice of such redemption.
(b) If fewer than all the outstanding Trust Securities are to be so
redeemed, the Common Securities and the Preferred Securities will be redeemed
Pro Rata and the Preferred Securities to be redeemed will be as described in
Section 4(d)(ii) below.
(c) The Trust may not redeem fewer than all the outstanding Trust
Securities unless all accumulated and unpaid Distributions have been paid on
all Trust Securities for all quarterly Distribution periods terminating on or
before the date of redemption.
(d) (i) Notice of any redemption of the Trust Securities, or
notice of distribution of Subordinated Debentures in
exchange for the Trust Securities (a "Redemption/Distribution
Notice"), will be given by the Regular Trustees on behalf of
the Trust by mail to each Holder of Trust Securities to be
redeemed or exchanged not fewer than 30 nor more than 60
days before the date fixed for redemption or exchange
thereof which, in the case of a redemption, will be the date
fixed for redemption of the Subordinated Debentures. For
purposes of the calculation of the date of redemption or
exchange and the dates on which notices are given pursuant
to this Section 4(d)(i), a Redemption/Distribution Notice
shall be deemed to be given on the day such notice is first
mailed by first-class mail, postage prepaid, to Holders of
Trust Securities. Each Redemption/Distribution Notice shall
be addressed to the Holders of Trust Securities at the
address of each such Holder appearing in the books and
records of the Trust. No defect in the
Redemption/Distribution Notice or in the mailing of either
thereof with respect to any Holder shall affect the validity
of the redemption or exchange proceedings with respect to
any other Holder.
(ii) In the event that fewer than all the outstanding Trust
Securities are to be redeemed, the Trust Securities to be
redeemed shall be redeemed Pro Rata and, in the event
Preferred Securities are represented by Global
Certificates held by or on behalf of the Depositary or
its nominee (or any successor depositary or its nominee),
the Depositary will reduce Pro Rata the amount of the
interest of each Depositary Participant in the Preferred
Securities to be redeemed; PROVIDED, THAT if, as a result
of such Pro Rata redemption, Depositary Participants
would hold fractional interests in the Preferred
Securities, the Depositary will adjust the amount of the
interest of each Depositary Participant to be redeemed to
avoid such fractional interests.
(iii) If Trust Securities are to be redeemed and the Regular
Trustees on behalf of the Trust give a Redemption/Distribution
Notice, which notice may only be issued if the Subordinated
Debentures are redeemed as set out in this Section 4 (which
notice will be irrevocable), then (A) while the Preferred
Securities
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are represented by Global Certificates, with respect to the
Preferred Securities, by 12:00 noon, New York City time, on
the redemption date, provided that the Sponsor has paid the
Property Trustee a sufficient amount of cash in connection
with the related redemption or maturity of the Subordinated
Debentures, then the Property Trustee will deposit
irrevocably with the Depositary funds sufficient to pay the
applicable Redemption Price with respect to the Preferred
Securities and will give the Depositary irrevocable
instructions and authority to pay the Redemption Price to
the Holders of the Preferred Securities, and (B) with
respect to Preferred Securities represented by Definitive
Preferred Security Certificates and Common Securities,
provided, that the Sponsor has paid the Property Trustee a
sufficient amount of cash in connection with the related
redemption or maturity of the Subordinated Debentures, then
the Property Trustee will pay the relevant Redemption Price
to the Holders of such Trust Securities by check mailed to
the address of the relevant Holder appearing on the books
and records of the Trust on the redemption date upon
surrender of their Certificates evidencing such Preferred
Securities and such Common Securities. If a
Redemption/Distribution Notice shall have been given and
funds deposited as required, then immediately prior to the
close of business on the date of such deposit, or on the
redemption date, as applicable, Distributions will cease to
accumulate on the Trust Securities so called for redemption
and all rights of Holders of such Trust Securities so called
for redemption will cease, except the right of the Holders
of such Trust Securities to receive the Redemption Price,
but without interest on such Redemption Price. Neither the
Regular Trustees nor the Trust shall be required to register
or cause to be registered the transfer of any Trust
Securities that have been so called for redemption. If any
date fixed for redemption of Trust Securities is not a
Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day that is
a Business Day (and without any interest or other payment in
respect of any such delay) except that, if such Business Day
falls in the next calendar year, such payment will be made
on the immediately preceding Business Day, in each case with
the same force and effect as if made on such date fixed for
redemption. If payment of the Redemption Price in respect
of any Trust Securities is improperly withheld or refused
and not paid either by the Property Trustee or by the
Sponsor as guarantor pursuant to the Preferred Securities
Guarantee or the Common Securities Guarantee, as the case
may be, Distributions on such Trust Securities will continue
to accumulate from the original redemption date to the
actual date of payment, in which case the actual payment
date will be considered the date fixed for redemption for
purpose of calculating the Redemption Price.
(iv) Redemption/Distribution Notices shall be sent by the
Regular Trustees on behalf of the Trust to (A) in respect
of the Preferred Securities, the Depositary if the
Preferred Securities are represented by Global
Certificates or, if Preferred Securities are represented
by Definitive Preferred Security
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Certificates, to the Holder thereof, and (B) in respect of
the Common Securities, to the Holder thereof.
(v) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities
laws), provided the acquiror is not the Holder of the
Common Securities or the obligor under the Indenture, the
Sponsor or any of 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.
5. VOTING RIGHTS - PREFERRED SECURITIES.
(a) Except as provided under Sections 5(b) and 7 and as otherwise required
by law, the Preferred Securities Guarantee and the Declaration, the
Holders of the Preferred Securities will have no voting rights.
(b) Subject to the requirements set forth in this paragraph, the Holders
of a Majority in liquidation amount of the Preferred Securities,
voting separately as a class may direct the time, method, and place of
conducting any proceeding for any remedy available to the Property
Trustee, or the exercise of any trust or power conferred upon the
Property Trustee under the Declaration, including (i) directing the
time, method, place of conducting any proceeding for any remedy
available to the Indenture Trustee, or exercising any trust or power
conferred on the Indenture Trustee with respect to the Subordinated
Debentures, (ii) waiving any past default and its consequences that is
waivable under Section 413 of the Indenture, or (iii) exercising any
right to rescind or annul a declaration that the principal of all the
Subordinated Debentures shall be due and payable, PROVIDED, HOWEVER,
that, where a consent under the Indenture would require the consent or
act of all of the holders of Subordinated Debentures affected thereby,
the Property Trustee may only give such consent or take such action at
the direction of all of the Holders of the Preferred Securities. The
Property Trustee shall not revoke any action previously authorized or
approved by a vote of the Holders of the Preferred Securities. Other
than with respect to directing the time, method and place of
conducting any remedy available to the Property Trustee or the
Indenture Trustee as set forth above, the Property Trustee shall not
take any action in accordance with the directions of the Holders of
the Preferred Securities under this paragraph unless the Property
Trustee has obtained an opinion of a nationally recognized independent
tax counsel experienced in such matters to the effect that for the
purposes of United States federal income tax the Trust will not fail
to be classified as a grantor trust on account of such action. If the
Property Trustee fails to enforce its rights under the Declaration or
the Subordinated Debentures, any Holder of Preferred Securities may
institute a legal proceeding directly against any Person to enforce
the Property Trustee's rights under the Declaration or the
Subordinated Debentures without first instituting a legal proceeding
against the Property Trustee or any other Person. Notwithstanding the
foregoing, if an Event of Default has occurred and is continuing and
such event is attributable to the failure of the Sponsor to pay
interest or principal on the
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Subordinated Debentures on the date such interest or principal is
otherwise payable (or in the case of redemption, on the redemption
date), then a Holder of Preferred Securities may directly institute
a proceeding for enforcement of payment to such holder of the
principal of or interest on the Subordinated Debentures having a
principal amount equal to the aggregate liquidation amount of the
Preferred Securities of such holder on or after the respective due
dates specified in the Subordinated Debentures. In connection with
such direct action, the Sponsor will be subrogated to the rights of
such Holder of Preferred Securities under the Declaration to the
extent of any payment made by the Sponsor to such Holder of Preferred
Securities in connection with such direct action.
Any 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 Trust
Securities in the Trust or pursuant to written consent. The Regular
Trustees will cause a notice of any meeting at which Holders of
Preferred Securities are entitled to vote, or of any matter upon which
action by written consent of such Holders is to be taken, to be mailed
to each Holder of record of Preferred Securities. Each such notice
will include a statement setting forth (i) the date of such meeting or
the date by which such action is to be taken, (ii) a description of
any resolution proposed for adoption at such meeting on which such
Holders are entitled to vote or of such matter upon which the written
consent is sought and (iii) instructions for the delivery of proxies
or consents.
No vote or consent of the Holders of the Preferred Securities will be
required for the Trust to redeem and cancel Preferred Securities or to
distribute the Subordinated Debentures in accordance with the
Declaration and the terms of the Trust Securities.
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 by the Sponsor or any
Affiliate of the Sponsor shall not be entitled to vote or consent and
shall, for purposes of such vote or consent, be treated as if they
were not outstanding.
6. VOTING RIGHTS - COMMON SECURITIES.
(a) Except as provided under Sections 6(b) and 6(c), and as otherwise
required by law and the Declaration, the Holders of the Common
Securities will have no voting rights.
(b) The Holders of the Common Securities are entitled, in accordance with
Article V of the Declaration, to vote to appoint, remove or replace
any Trustee or to increase or decrease the number of Trustees.
(c) Subject to Section 2.6 of the Declaration, only after an Event of
Default with respect to the Preferred Securities has been cured,
waived or otherwise eliminated and subject to the requirements set
forth in this paragraph, the Holders of a Majority in
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liquidation amount of the Common Securities, voting separately as a
class, may direct the time, method and place of conducting any
proceeding for any remedy available to the Property Trustee, or the
exercise of any trust or power conferred upon the Property Trustee
under the Declaration, including (i) directing the time, method, place
of conducting any proceeding for any remedy available to the Property
Trustee, or exercising any trust or power conferred on the Property
Trustee with respect to the Subordinated Debentures, (ii) waiving any
past default and its consequences that is waivable under Section 413
of the Indenture, or (iii) exercising any right to rescind or annul a
declaration that the principal of all the Subordinated Debentures
shall be due and payable, PROVIDED, HOWEVER, that, where a consent or
action under the Indenture would require the consent or act of all of
the holders of the Subordinated Debentures, the Property Trustee may
only give such consent or take such action at the direction of all of
the Holders of the Common Securities. Pursuant to this Section 6(c),
the Property Trustee shall not revoke any action previously authorized
or approved by a vote of the Holders of the Common Securities. Other
than with respect to directing the time, method and place of
conducting any remedy available to the Property Trustee or the
Indenture Trustee as set forth above, the Property Trustee shall not
take any action in accordance with the directions of the Holders of
the Common Securities under this paragraph unless the Property Trustee
has obtained, at the expense of the Holders of the Common Securities,
a written opinion of a nationally recognized independent tax counsel
experienced in such matters to the effect that for the purposes of
United States federal income tax the Trust will not fail to be
classified as a grantor trust on account of such action. If the
Property Trustee fails to enforce its rights under the Declaration and
the Subordinated Debentures, any Holder of Common Securities may after
written request to the Property Trustee to enforce such rights,
institute a legal proceeding directly against any Person to enforce
the Property Trustee's rights under the Declaration and the
Subordinated Debentures, without first instituting a legal proceeding
against the Property Trustee or any other person. Notwithstanding the
foregoing, if an Event of Default has occurred and is continuing and
such event is attributable to the failure of the Sponsor to pay
interest or principal on the Subordinated Debentures on the date such
interest or principal is otherwise payable (or in the case of
redemption, on the redemption date), then a Holder of Common
Securities may directly institute a proceeding for enforcement of
payment to such holder of the principal of or interest on the
Subordinated Debentures having a principal amount equal to the
aggregate liquidation amount of the Common Securities of such holder
on or after the respective due dates specified in the Subordinated
Debentures. In connection with such direct action, the Sponsor will
be subrogated to the rights of such Holder of Common Securities under
the Declaration to the extent of any payment made by the Sponsor to
such Holder of Common Securities in connection with such direct
action.
Any approval or direction of Holders of Common Securities may be given
at a separate meeting of Holders of Common Securities convened for
such purpose, at a meeting of all of the Holders of Trust Securities
in the Trust or pursuant to written consent. The Regular Trustees
will cause a notice of any meeting at which Holders
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of Common Securities are entitled to vote, or of any matter upon which
action by written consent of such Holders is to be taken, to be mailed
to each Holder of record of Common Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the
date by which such action is to be taken, (ii) a description of any
resolution proposed for adoption at such meeting on which such Holders
are entitled to vote or of such matter upon which written consent is
sought and (iii) instructions for the delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to
distribute the Subordinated Debentures in accordance with the
Declaration and the terms of the Trust Securities.
7. AMENDMENTS TO DECLARATION AND INDENTURE.
(a) If any proposed amendment to the Declaration provides for, or the
Regular Trustees otherwise propose to effect (i) any action that would
adversely affect the powers, preferences or special rights of the
Trust Securities, whether by way of amendment to the Declaration or
otherwise, or (ii) the involuntary or voluntary liquidation,
dissolution, winding-up or termination of the Trust, other than as
described in Section 8.1 of the Declaration, then the Holders of
outstanding Trust Securities as a class, will be entitled to vote on
such amendment or proposal (but not on any other amendment or
proposal) and such amendment or proposal shall not be effective except
with the approval of the Holders of at least 66-2/3% in liquidation
amount of the Trust Securities, voting together as a single class;
provided that a reduction of the aggregate liquidation amount or the
Distribution rate, a change in the payment dates or maturities of the
Preferred Securities or a reduction in the percentage in liquidation
amount of outstanding Preferred Securities, the consent of the Holders
of which is required for an amendment to the Declaration shall not be
permitted without the consent of each Holder of the Preferred
Securities. In the event any amendment or proposal referred to in
clause (i) above would adversely affect only the Preferred Securities
or only the Common Securities, then only the affected class will be
entitled to vote on such amendment or proposal and such amendment or
proposal shall not be effective except with the approval of 66-2/3% in
liquidation amount of such class of Trust Securities.
(b) In the event the consent of the Property Trustee, as the holder of the
Subordinated Debentures, the Preferred Securities Guarantee and the
Common Securities Guarantee, is required under the Indenture with
respect to any amendment, modification, waiver or termination of the
Indenture, the Subordinated Debentures, the Preferred Securities
Guarantee or the Common Securities Guarantee, the Property Trustee
shall request the direction of the Holders of the Trust Securities
with respect to such amendment, modification, waiver or termination
and shall vote with respect to such amendment, modification, waiver or
termination as directed by a Majority in liquidation amount of the
Trust Securities voting together as a single class; PROVIDED, HOWEVER,
that where a consent under the Indenture would require the consent of
all of the holders of the Subordinated Debentures, the Property
A-9
Trustee may only give such consent at the direction of all of the
Holders of the Trust Securities; PROVIDED, FURTHER, that the Property
Trustee shall not take any action in accordance with the directions of
the Holders of the Trust Securities under this Section 7(b) unless the
Property Trustee has obtained, at the expense of the Holders of the
Trust Securities, a written opinion of a nationally recognized
independent tax counsel experienced in such matters to the effect that
for the purposes of United States federal income tax the Trust will
not be classified as other than a grantor trust on account of such
action.
8. PRO RATA.
A reference to any payment, distribution or treatment as being "Pro Rata"
shall mean pro rata to each Holder of Trust Securities according to the
aggregate liquidation amount of the Trust Securities held by the relevant Holder
in relation to the aggregate liquidation amount of all Trust Securities
outstanding unless, in relation to a payment, an Event of Default under the
Indenture has occurred and is continuing, in which case any funds available to
make such payment shall be paid first to each Holder of the Preferred Securities
pro rata according to the aggregate liquidation amount of Preferred Securities
held by the relevant Holder relative to the aggregate liquidation amount of all
Preferred Securities outstanding, and only after satisfaction of all amounts
owed to the Holders of the Preferred Securities, to each Holder of Common
Securities pro rata according to the aggregate liquidation amount of Common
Securities held by the relevant Holder relative to the aggregate liquidation
amount of all Common Securities outstanding.
9. RANKING.
The Preferred Securities rank PARI PASSU and payment thereon shall be made
Pro Rata with the Common Securities except that, where an Event of Default
occurs and is continuing under the Indenture in respect of the Subordinated
Debentures held by the Property Trustee, the rights of Holders of the Common
Securities to payment in respect of Distributions and payments upon liquidation,
redemption and otherwise are subordinated to the rights to payment of the
Holders of the Preferred Securities.
10. LISTING.
The Regular Trustees shall use their best efforts to cause the Preferred
Securities to be listed on the New York Stock Exchange subject to notice of
issuance.
11. ACCEPTANCE OF TRUST SECURITIES GUARANTEE AND INDENTURE.
Each Holder of Preferred Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein and to the provisions of the Indenture.
12. NO PREEMPTIVE RIGHTS.
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The Holders of the Trust Securities shall have no preemptive rights to
subscribe for any additional securities.
13. MISCELLANEOUS.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the Preferred
Securities Guarantee or the Common Securities Guarantee (as may be
appropriate), and the Indenture to a Holder without charge on written request
to the Trust at its principal place of business.
A-11
ANNEX I
[IF THE PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE INSERT - This
Preferred Security is a Global Certificate within the meaning of the Declaration
hereinafter referred to and is registered in the name of The Depository Trust
Company, a New York corporation (the "Depositary"), or a nominee of the
Depositary. This Preferred 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 Declaration and no transfer of
this Preferred Security (other than a transfer of this Preferred Security as a
whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary) may be
registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized representative
of the Depositary to the Trust or its agent for registration of transfer,
exchange or payment, and any Preferred Security issued is registered in the name
of CEDE & Co. or such other name as is requested by an authorized representative
of the Depositary and any payment hereon is made to CEDE & Co. or 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 A PERSON IS
WRONGFUL since the registered owner hereof, CEDE & Co., has an interest herein.]
Certificate Number Number of Preferred Securities
CUSIP NO.
Certificate Evidencing Preferred Securities
of
NVP CAPITAL III
Preferred Securities
(liquidation amount $25 per Preferred Security)
NVP CAPITAL III, a statutory business trust formed 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 interests in the assets of the Trust
designated the _____% Trust Issued Preferred Securities (liquidation amount
$25 per Preferred Security) (the "Preferred Securities"). The Preferred
Securities are transferable on the books and records of the Trust, in person
or by a duly authorized attorney, upon surrender of this certificate duly
endorsed and in proper form for transfer. 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 Declaration of Trust
of the Trust dated as of ________, 1998, as the same may be amended from time
to time (the "Declaration"), including the designation of the terms of the
Preferred Securities
I-1
as set forth in Exhibit A to the Declaration. Capitalized terms used
herein but not defined shall have the meaning given them in the Declaration.
The Holder is entitled to the benefits of the Preferred Securities Guarantee to
the extent provided therein. The Sponsor will provide a copy of the
Declaration, the Preferred Securities Guarantee and the Indenture to a Holder
without charge upon written request to the Trust at its principal place of
business.
Upon receipt of this certificate, the Holder is bound by the Declaration
and is entitled to the benefits thereunder.
By acceptance, the holder agrees to treat for United States federal income
tax purposes, the Subordinated Debentures as indebtedness and the Preferred
Securities as evidence of indirect beneficial ownership in the Subordinated
Debentures.
IN WITNESS WHEREOF, the Trust has executed this certificate this _____ day
of ________________________, ________.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
as Trustee
__________________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
as Trustee
__________________________________________
I-2
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)
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ANNEX II
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
NVP CAPITAL III
Common Securities
(liquidation amount $25 per Common Security)
NVP CAPITAL III, a statutory business trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that ___________________ (the
"Holder") is the registered owner of common securities of the Trust representing
undivided beneficial interests in the assets of the Trust designated the _____%
Trust Common Securities (liquidation amount $25 per Common Security) (the
"Common Securities"). Subject to the limitations set forth in Article 9 of the
Declaration, the Common Securities are transferable on the books and records of
the Trust, in person or by a duly authorized attorney, upon surrender of this
certificate duly endorsed and in proper form for transfer. The designation,
rights, privileges, restrictions, preferences and other terms and provisions of
the Common Securities represented hereby are issued and shall in all respects be
subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust dated as of _________, 1998, as the same may be amended from time to
time (the "Declaration"), including the designation of the terms of the Common
Securities as set forth in Exhibit A to the Declaration. Capitalized terms used
herein but not defined shall have the meaning given them in the Declaration.
The Holder is entitled to the benefits of the Common Securities Guarantee
to the extent provided therein. The Trust will provide a copy of the
Declaration, the Common Securities Guarantee and the Indenture to the Holder
without charge upon written request to the Trust at its principal place of
business.
Upon receipt of this certificate, the Sponsor is bound by the Declaration
and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat for United States federal income
tax purposes the Subordinated Debentures as indebtedness and the Common
Securities as evidence of indirect beneficial ownership in the Subordinated
Debentures.
II-1
IN WITNESS WHEREOF, the Trust has executed this certificate this __________
day of ________, ______.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
as Trustee
__________________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
as Trustee
__________________________________________
II-2
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)
II-3
EXHIBIT B
__________________________
PREFERRED SECURITIES GUARANTEE AGREEMENT
NVP CAPITAL III
DATED AS OF _________, 1998
__________________________
TABLE OF CONTENTS
PAGE
----
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.01 Definitions and Interpretation. . . . . . . . . . . . . . . . 1
ARTICLE II
TRUST INDENTURE ACT
Section 2.01 Trust Indenture Act; Application. . . . . . . . . . . . . . . 4
Section 2.02 Lists of Holders of Trust Securities. . . . . . . . . . . . . 4
Section 2.03 Reports by the Preferred Guarantee Trustee. . . . . . . . . . 5
Section 2.04 Periodic Reports to Preferred Guarantee Trustee . . . . . . . 5
Section 2.05 Evidence of Compliance with Conditions Precedent. . . . . . . 5
Section 2.06 Events of Default; Waiver . . . . . . . . . . . . . . . . . . 5
Section 2.07 Event of Default; Notice. . . . . . . . . . . . . . . . . . . 5
Section 2.08 Conflicting Interests . . . . . . . . . . . . . . . . . . . . 6
ARTICLE III
POWER, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE
Section 3.01 Powers and Duties of the Preferred Guarantee Trustee. . . . . 6
Section 3.02 Certain Rights of Preferred Guarantee Trustee . . . . . . . . 7
Section 3.03 Not Responsible for Recitals or Issuance of Guarantee . . . . 9
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
Section 4.01 Preferred Guarantee Trustee; Eligibility. . . . . . . . . . . 9
Section 4.02 Appointment, Removal and Resignation of Preferred
Guarantee Trustees. . . . . . . . . . . . . . . . . . . . . .10
ARTICLE V
GUARANTEE
Section 5.01 Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . .11
Section 5.02 Subordination . . . . . . . . . . . . . . . . . . . . . . . .11
Section 5.03 Waiver of Notice and Demand . . . . . . . . . . . . . . . . .11
Section 5.04 Obligations Not Affected. . . . . . . . . . . . . . . . . . .11
i
Section 5.05 Rights of Holders . . . . . . . . . . . . . . . . . . . . . .12
Section 5.06 Guarantee of Payment. . . . . . . . . . . . . . . . . . . . .12
Section 5.07 Subrogation . . . . . . . . . . . . . . . . . . . . . . . . .12
Section 5.08 Independent Obligations . . . . . . . . . . . . . . . . . . .13
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
Section 6.01 Limitation of Transactions. . . . . . . . . . . . . . . . . .13
Section 6.02 Ranking . . . . . . . . . . . . . . . . . . . . . . . . . . .13
ARTICLE VII
TERMINATION
Section 7.01 Termination . . . . . . . . . . . . . . . . . . . . . . . . .14
ARTICLE VIII
INDEMNIFICATION
Section 8.01 Exculpation . . . . . . . . . . . . . . . . . . . . . . . . .14
Section 8.02 Indemnification . . . . . . . . . . . . . . . . . . . . . . .14
ARTICLE IX
MISCELLANEOUS
Section 9.01 Successors and Assigns. . . . . . . . . . . . . . . . . . . .15
Section 9.02 Amendments. . . . . . . . . . . . . . . . . . . . . . . . . .15
Section 9.03 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . .15
Section 9.04 Benefit . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Section 9.05 Governing Law . . . . . . . . . . . . . . . . . . . . . . . .16
ii
CROSS-REFERENCE TABLE*
Section of Trust Indenture Section of
Act of 1939, as amended Guarantee Agreement
-------------------------- -------------------
310(a) 4.01(a)
310(b) 4.01(c)
310(c) Inapplicable
311(a) 2.02(b)
311(b) 2.02(b)
311(c) Inapplicable
312(a) 2.02(a)
312(b) 2.02(b)
313 2.03
314(a) 2.04
314(b) Inapplicable
314(c) 2.05
314(d) Inapplicable
314(e) 1.01, 2.05, 3.02
314(f) 2.01, 3.02
315(a) 3.01(d)
315(b) 2.07
315(c) 3.01
315(d) 3.01(d)
316(a) 1.01, 2.06, 5.05
316(b) 5.04
316(c) Inapplicable
317(a) Inapplicable
317(b) Inapplicable
318(a) 2.01(b)
* This Cross-Reference Table does not constitute part of the Guarantee Agreement
and shall not affect the interpretation of any of its terms or provisions.
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PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (this "Guarantee Agreement"), dated as of
_________, 1998, is executed and delivered by Nevada Power Company, a Nevada
corporation (the "Guarantor"), and IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company, a New York
banking corporation, as trustee (the "Preferred Guarantee Trustee"), for the
benefit of the Holders (as defined herein) from time to time of the Preferred
Securities (as defined herein) of NVP Capital III, a Delaware statutory business
trust (the "Issuer").
RECITALS
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of _________, 1998, among the trustees of the Issuer
named therein, the Guarantor as sponsor and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing on the date hereof $70,000,000 aggregate stated liquidation amount of
Preferred Securities designated the _____% Trust Issued Preferred Securities
(the "Preferred Securities");
WHEREAS, as incentive for the Holders (as hereinafter defined) to purchase
the Preferred Securities, the Guarantor desires irrevocably and unconditionally
to agree, to the extent set forth in this Guarantee Agreement, to pay to the
Holders of the Preferred Securities the Guarantee Payments (as defined herein)
and to make certain other payments on the terms and conditions set forth herein;
and
WHEREAS, the Guarantor is also executing and delivering a guarantee
agreement (the "Common Securities Guarantee Agreement") with substantially
identical terms to this Guarantee Agreement for the benefit of the holders of
the Common Securities (as defined herein) except that if an Event of Default (as
defined in the Indenture (as defined herein)), has occurred and is continuing,
the rights of holders of the Common Securities to receive Guarantee Payments
under the Common Securities Guarantee Agreement are subordinated to the rights
of Holders of Preferred Securities to receive Guarantee Payments under this
Guarantee Agreement.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee Agreement for
the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.01 DEFINITIONS AND INTERPRETATION.
In this Guarantee Agreement, unless the context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble above have the respective meanings assigned to them
in this Section 1.01;
(b) a term defined anywhere in this Guarantee Agreement has the
same meaning throughout;
(c) all references to "this Guarantee Agreement" are to this
Guarantee Agreement as modified, supplemented or amended from time to time;
(d) all references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement unless
otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Guarantee Agreement unless otherwise defined in this Guarantee
Agreement or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means any Person that is authorized to
bind such Person and, with respect to the Guarantor, the Chairman of the Board,
the Chief Executive Officer, the President, any Vice President, the Treasurer,
any assistant Treasurer or any other Officer, or agent of the Guarantor duly
authorized by the board of directors of the Guarantor to act in such matters
relating to the Declaration.
"Common Securities" means the common securities representing undivided
beneficial interests in the assets of the Issuer.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
"Direction" by a Person means a written direction signed:
(a) if the Person is a natural person by that Person; or
(b) in any other case, in the name of such Person by one or more
Authorized Officers of that Person.
"Event of Default" means a default by the Guarantor on any of its payment
or other obligations under this Guarantee Agreement.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or
made by the Issuer: (i) any accumulated and unpaid Distributions (as defined in
the Declaration) that are required to be paid on such Preferred Securities to
the extent the Issuer shall have funds available therefor, (ii) the redemption
price, including all accumulated and unpaid Distributions to the date of
redemption (the "Redemption Price"), to the extent the Issuer shall have funds
available therefor
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with respect to any Preferred Securities called for redemption by the Issuer,
and (iii) upon a voluntary or involuntary liquidation, dissolution,
winding-up or termination of the Issuer (other than in connection with the
distribution of Subordinated Debentures to the Holders or the redemption of
all the Preferred Securities upon the redemption or Maturity Date (as defined
in the Indenture) of the Subordinated Debentures), the lesser of (a) the
aggregate of the liquidation amount and all accumulated and unpaid
Distributions on the Preferred Securities to the date of payment to the
extent the Trust shall have funds available therefor, and (b) the amount of
assets of the Issuer remaining available for distribution to Holders in
liquidation of the Issuer (in either case, the "Liquidation Distribution").
"Holder" means any holder, as registered on the books and records of the
Issuer of any Preferred Securities; PROVIDED, THAT, in determining whether the
holders of the requisite percentage of Preferred Securities have given any
request, notice, consent or waiver hereunder, "Holder" shall not include the
Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee, any Affiliate
of the Preferred Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives or agents of the Preferred
Guarantee Trustee.
"Indenture" means the Indenture dated as of _________, 1998, among the
Guarantor and IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company, as trustee, as modified,
amended or supplemented from time to time.
"Majority in liquidation amount of the Trust Securities" means, except as
provided by the Trust Indenture Act, a vote by ▇▇▇▇▇▇(s) of Preferred
Securities, voting separately as a class, of more than 50% of the 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 Preferred Securities.
"Officer's Certificate" means, with respect to any Person, a certificate
signed by an Authorized Officer of such Person. Any Officer's Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Guarantee Agreement shall include:
(a) a statement that such officer signing the Officer's Certificate
has read the covenant or condition and the definition relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officer's Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such
condition or covenant has been complied with.
B-3
"Opinion of Counsel" or "opinion of counsel" means a written opinion of
counsel for the Preferred Guarantee Trustee or the Guarantor and who shall be
reasonably acceptable to the Preferred Guarantee Trustee.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Preferred Guarantee Trustee" means IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company,
until a Successor Preferred Guarantee Trustee has been appointed and has
accepted such appointment pursuant to the terms of this Guarantee Agreement, and
thereafter means each such Successor Preferred Guarantee Trustee.
"Responsible Officer" means, when used with respect to the Preferred
Guarantee Trustee, any vice-president, any assistant vice-president, the
secretary, any assistant secretary, the treasurer, any assistant treasurer or
any other officer in the Corporate Trust Office customarily performing functions
similar to those performed by any of the above designated officers and having
direct responsibility for administration of this Guarantee Agreement and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of that officer's knowledge of and
familiarity with the particular subject.
"Securities Act" means the Securities Act of 1933, as the same may be
amended from time to time, or any successor legislation.
"Subordinated Debentures" means $72,164,950 aggregate principal amount of
the Guarantor's _____% Junior Subordinated Deferrable Interest Debentures due
2038 held by the Property Trustee of the Issuer.
"Successor Preferred Guarantee Trustee" means a successor Preferred
Guarantee Trustee possessing the qualifications to act as Preferred Guarantee
Trustee under Section 4.01.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as the same
may be amended from time to time, or any successor legislation.
"Trust Securities" means collectively the Common Securities and the
Preferred Securities.
ARTICLE II
TRUST INDENTURE ACT
Section 2.01 TRUST INDENTURE ACT; APPLICATION.
(a) This Guarantee Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this Guarantee Agreement
and shall, to the extent applicable, be governed by such provisions; and
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(b) If and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by Sections
310 to 317, inclusive, of the Trust Indenture Act, such duties imposed by the
Trust Indenture Act shall control.
Section 2.02 LISTS OF HOLDERS OF TRUST SECURITIES.
(a) The Guarantor shall provide the Preferred Guarantee Trustee
with a list, in such form as the Preferred Guarantee Trustee may reasonably
require, of the names and addresses of the Holders ("List of Holders") as of
such date, (i) within 14 days after each record date for payment of
distributions, and (ii) at any other time within 30 days of receipt by the
Guarantor of a written request for a List of Holders as of a date no more
than 14 days before such List of Holders is given to the Preferred Guarantee
Trustee provided that the Guarantor shall not be obligated to provide such
List of Holders at any time the List of Holders does not differ from the most
recent List of Holders given to the Preferred Guarantee Trustee by the
Guarantor. The Preferred Guarantee Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Preferred Guarantee Trustee shall comply with its
obligations under Sections 311(a), 311(b) and 312(b) of the Trust Indenture
Act.
Section 2.03 REPORTS BY THE PREFERRED GUARANTEE TRUSTEE.
Within 60 days after December 31 of each year, the Preferred Guarantee
Trustee shall provide to the Holders of the Preferred Securities such reports as
are required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The Preferred
Guarantee Trustee shall also comply with the requirements of Section 313(d) of
the Trust Indenture Act.
Section 2.04 PERIODIC REPORTS TO PREFERRED GUARANTEE TRUSTEE.
The Guarantor shall provide to the Preferred Guarantee Trustee such
documents, reports and information as required by Section 314 (if any) and the
compliance certificate required by Section 314 of the Trust Indenture Act in the
form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
Section 2.05 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
The Guarantor shall provide to the Preferred Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Guarantee Agreement that relate to any of the matters set forth in Section
314 (c) of the Trust Indenture Act. Any certificate or opinion required to be
given by officers of the Guarantor pursuant to Section 314(c)(1) shall be given
in the form of an Officer's Certificate.
Section 2.06 EVENTS OF DEFAULT; WAIVER.
The Holders of a Majority in liquidation amount of Preferred Securities
may, by vote, on behalf of the Holders of all of the Preferred Securities, waive
any past Event of Default and its consequences. Upon such waiver, any such
Event of Default shall cease to exist, and any Event
B-5
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Guarantee Agreement, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right
consequent thereon.
Section 2.07 EVENT OF DEFAULT; NOTICE.
(a) The Preferred Guarantee Trustee shall, within 90 days after
the occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders, notices of all Events of Default known to the
Preferred Guarantee Trustee, unless such defaults have been cured before the
giving of such notice, PROVIDED, THAT, the Preferred Guarantee Trustee shall
be protected in withholding such notice if and so long as the board of
directors, the executive committee, or a trust committee of directors and/or
Responsible Officers of the Preferred Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders.
(b) The Preferred Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless a Responsible Officer of the
Preferred Guarantee Trustee shall have received written notice as provided in
Section 9.03, or a Responsible Officer shall have obtained actual notice, of
such Event of Default.
Section 2.08 CONFLICTING INTERESTS.
The Declaration shall be deemed to be specifically described in this
Guarantee Agreement for the purposes of the first proviso contained in Section
310(b) of the Trust Indenture Act.
ARTICLE III
POWER, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE
Section 3.01 POWERS AND DUTIES OF THE PREFERRED GUARANTEE TRUSTEE.
(a) This Guarantee Agreement shall be held by the Preferred
Guarantee Trustee for the benefit of the Holders, and the Preferred Guarantee
Trustee shall not transfer this Guarantee Agreement to any Person except a
Holder exercising his or her rights pursuant to Section 5.05(b) or to a
Successor Preferred Guarantee Trustee on acceptance by such Successor
Preferred Guarantee Trustee of its appointment to act as Successor Preferred
Guarantee Trustee. The right, title and interest of the Preferred Guarantee
Trustee shall automatically vest in any Successor Preferred Guarantee
Trustee, and such vesting and cessation of title shall be effective whether
or not conveyancing documents have been executed and delivered pursuant to
the appointment of such Successor Preferred Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the
Preferred Guarantee Trustee shall enforce this Guarantee Agreement for the
benefit of the Holders.
(c) The Preferred Guarantee Trustee, before the occurrence of any
Event of Default and after the curing of all Events of Default that may have
occurred, shall undertake to
B-6
perform only such duties as are specifically set forth in this Guarantee
Agreement, and no implied covenants shall be read into this Guarantee
Agreement against the Preferred Guarantee Trustee. In case an Event of
Default has occurred (that has not been cured or waived pursuant to Section
2.06), the Preferred Guarantee Trustee shall exercise such of the rights and
powers vested in it by this Guarantee Agreement, and use the same degree of
care and skill in its exercise thereof, as a prudent person would exercise or
use under the circumstances in the conduct of his or her own affairs.
(d) No provision of this Guarantee Agreement shall be construed to
relieve the Preferred Guarantee Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct,
except that:
(i) prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the
Preferred Guarantee Trustee shall be determined solely by the
express provisions of this Guarantee Agreement, and the Preferred
Guarantee Trustee shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this
Guarantee Agreement, and no implied covenants or obligations shall
be read into this Guarantee Agreement against the Preferred
Guarantee Trustee; and
(B) in the absence of bad faith on the part of
the Preferred Guarantee Trustee, the Preferred Guarantee Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Preferred Guarantee
Trustee and conforming to the requirements of this Guarantee
Agreement; but in the case of any such certificates or opinions
that by any provision hereof are specifically required to be
furnished to the Preferred Guarantee Trustee, the Preferred
Guarantee Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Guarantee Agreement;
(ii) the Preferred Guarantee Trustee shall not be liable
for any error of judgment made in good faith by a Responsible Officer of
the Preferred Guarantee Trustee, unless it shall be proved that the
Preferred Guarantee Trustee was negligent in ascertaining the pertinent
facts upon which such judgment was made;
(iii) the Preferred Guarantee Trustee shall not be liable
with respect to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders of not less than a
Majority in liquidation amount of the Preferred Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Preferred Guarantee Trustee, or exercising any trust or
power conferred upon the Preferred Guarantee Trustee under this
Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall
require the Preferred Guarantee Trustee to expend or risk its own funds
or otherwise incur personal financial liability in the performance of
any of its duties or in the exercise of any of its rights or
B-7
powers, if the Preferred Guarantee Trustee shall have reasonable grounds
for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Guarantee Agreement or
adequate indemnity against such risk or liability is not reasonably
assured to it.
Section 3.02 CERTAIN RIGHTS OF PREFERRED GUARANTEE TRUSTEE.
(a) Subject to the provisions of Section 3.01:
(i) The Preferred Guarantee Trustee may rely and shall be
fully protected in acting or refraining from acting upon any resolution,
certificate, Officer's Certificate, statement, instrument, opinion,
Opinion of Counsel, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed, sent or
presented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by
this Guarantee Agreement shall be sufficiently evidenced by a Direction
or an Officer's Certificate.
(iii) Whenever, in the administration of this Guarantee
Agreement, the Preferred Guarantee Trustee shall deem it desirable that
a matter be proved or established before taking, suffering or omitting
any action hereunder, the Preferred Guarantee Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of bad
faith on its part, request and rely upon an Officer's Certificate which,
upon receipt of such request, shall be promptly delivered by the
Guarantor.
(iv) The Preferred Guarantee Trustee shall have no duty to
see to any recording, filing or registration of any instrument (or any
re-recording, refiling or registration thereof).
(v) The Preferred Guarantee Trustee may consult with
counsel, and the written advice or opinion of such counsel with respect
to legal matters 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 accordance with such advice or opinion. Such counsel
may be counsel to the Guarantor or any of its Affiliates and may include
any of its employees. The Preferred Guarantee Trustee shall have the
right at any time to seek instructions concerning the administration of
this Guarantee Agreement from any court of competent jurisdiction.
(vi) The Preferred Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
Guarantee Agreement at the request or direction of any Holder, unless
such Holder shall have provided to the Preferred Guarantee Trustee such
security and indemnity acceptable to the Preferred Guarantee Trustee,
against the costs, expenses (including attorneys' fees and expenses) and
liabilities that might be incurred by it in complying with such request
or direction, including such reasonable advances as may be requested by
the Preferred Guarantee Trustee; provided that, nothing contained in
this Section 3.02(a)(vi) shall be taken to
B-8
relieve the Preferred Guarantee Trustee, upon the occurrence of an Event
of Default, of its obligation to exercise the rights and powers vested
in it by this Guarantee Agreement.
(vii) The Preferred Guarantee Trustee shall not be bound to
make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document, but the Preferred
Guarantee Trustee, in its discretion may make such further inquiry or
investigation into such facts or matters as it may see fit.
(viii) The Preferred Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys, and the Preferred
Guarantee Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care
by it hereunder.
(ix) Any action taken by the Preferred Guarantee Trustee or
its agents hereunder shall bind the Holders, and the signature of the
Preferred Guarantee Trustee or its agents alone shall be sufficient and
effective to perform any such action. No third party shall be required
to inquire as to the authority of the Preferred Guarantee Trustee to so
act or as to its compliance with any of the terms and provisions of this
Guarantee Agreement, both of which shall be conclusively evidenced by
the Preferred Guarantee Trustee's or its agent's taking such action.
(x) Whenever in the administration of this Guarantee
Agreement the Preferred Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Preferred Guarantee Trustee (i)
may request instructions from the Holders, (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 acting in
accordance with such instructions.
(b) No provision of this Guarantee Agreement shall be deemed to impose
any duty or obligation on the Preferred Guarantee Trustee to perform any act
or acts or exercise any right, power, duty or obligation conferred or imposed
on it in any jurisdiction in which it shall be illegal, or in which the
Preferred Guarantee Trustee shall be unqualified or incompetent in accordance
with applicable law, to perform any such act or acts or to exercise any such
right, power, duty or obligation. No permissive power or authority available
to the Preferred Guarantee Trustee shall be construed to be a duty.
Section 3.03 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF GUARANTEE.
The recitals contained in this Guarantee shall be taken as the
statements of the Guarantor, and the Preferred Guarantee Trustee does not
assume any responsibility for their correctness. The Preferred Guarantee
Trustee makes no representation as to the validity or sufficiency of this
Guarantee Agreement.
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
Section 4.01 PREFERRED GUARANTEE TRUSTEE; ELIGIBILITY.
(a) There shall at all times be a Preferred Guarantee Trustee that
shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under
the laws of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or Person
permitted by the Securities and Exchange Commission to act as an
institutional trustee under the Trust Indenture Act, authorized under
such laws to exercise corporate trust powers, having a combined capital
and surplus of at least 50 million U.S. dollars ($50,000,000), and
subject to supervision or examination by Federal, State, Territorial or
District of Columbia authority. If such corporation publishes reports
of condition at least annually, pursuant to law or to the requirements
of the supervising or examining authority referred to above, then, for
the purposes of this Section 4.01(a)(ii), the combined capital and
surplus of such corporation shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Preferred Guarantee Trustee shall cease to
be eligible to so act under Section 4.01(a), the Preferred Guarantee Trustee
shall immediately resign in the manner and with the effect set out in Section
4.02 (c).
(c) If the Preferred Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Preferred Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.
Section 4.02 APPOINTMENT, REMOVAL AND RESIGNATION OF PREFERRED GUARANTEE
TRUSTEES.
(a) Subject to Section 4.02(b), the Preferred Guarantee Trustee
may be appointed or removed without cause at any time by the Guarantor.
(b) The Preferred Guarantee Trustee shall not be removed in
accordance with Section 4.02(a) until a Successor Preferred Guarantee Trustee
has been appointed and has accepted such appointment by written instrument
executed by such Successor Preferred Guarantee Trustee and delivered to the
Guarantor and the Preferred Guarantee Trustee being removed.
(c) The Preferred Guarantee Trustee appointed to office shall hold
office until a Successor Preferred Guarantee Trustee shall have been
appointed or until its removal or resignation. The Preferred Guarantee
Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing executed by the Preferred Guarantee
Trustee and delivered to the Guarantor, which resignation shall not take
effect until a Successor Preferred Guarantee Trustee has been appointed and
has accepted such appointment by instrument in
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writing executed by such Successor Preferred Guarantee Trustee and delivered
to the Guarantor and the resigning Preferred Guarantee Trustee.
(d) If no Successor Preferred Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.02 within 60
days after delivery to the Guarantor of an instrument of resignation, the
resigning Preferred Guarantee Trustee may petition any court of competent
jurisdiction for appointment of a Successor Preferred Guarantee Trustee.
Such court may thereupon, after prescribing such notice, if any, as it may
deem proper, appoint a Successor Preferred Guarantee Trustee.
ARTICLE V
GUARANTEE
Section 5.01 GUARANTEE.
The Guarantor irrevocably and unconditionally agrees to pay in full to
the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
Section 5.02 SUBORDINATION.
If an event of default under the Indenture has occurred and is
continuing, the rights of holders of the Common Securities to receive
payments under the Common Securities Guarantee Agreement are subordinated to
the rights of Holders to receive Guarantee Payments.
Section 5.03 WAIVER OF NOTICE AND DEMAND.
The Guarantor hereby waives notice of acceptance of this Guarantee
Agreement and of any liability to which it applies or may apply, presentment,
demand for payment, any right to require a proceeding first against the
Issuer or any other Person before proceeding against the Guarantor, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.
Section 5.04 OBLIGATIONS NOT AFFECTED.
The obligations, covenants, agreements and duties of the Guarantor under
this Guarantee Agreement shall in no way be affected or impaired by reason of
the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of
the performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Preferred Securities
to be performed or observed by the Issuer;
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(b) the extension of time for the payment by the Issuer of all or
any portion of the Distributions, Redemption Price, Liquidation Distribution
or any other sums payable under the terms of the Preferred Securities or the
extension of time for the performance of any other obligation under, arising
out of, or in connection with, the Preferred Securities (other than an
extension of time for payment of Distributions, Redemption Price, Liquidation
Distribution or other sums payable that results from the extension of any
interest payment period on the Subordinated Debentures or any extension of
the maturity date of the Subordinated Debentures permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the part
of the Holders to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Holders pursuant to the terms of the Preferred
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting, the Issuer
or any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it being
the intent of this Section 5.04 that the obligations of the Guarantor
hereunder shall be absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain
consent of, the Guarantor with respect to the happening of any of the
foregoing.
Section 5.05 RIGHTS OF HOLDERS.
(a) The Holders of a Majority in liquidation amount of the
Preferred Securities have the right to direct the time, method and place of
conducting of any proceeding for any remedy available to the Preferred
Guarantee Trustee in respect of this Guarantee Agreement or exercising any
trust or power conferred upon the Preferred Guarantee Trustee under this
Guarantee Agreement.
(b) Notwithstanding anything contained herein, any Holder of
Preferred Securities may institute a legal proceeding directly against the
Guarantor to enforce its rights under this Guarantee Agreement, without first
instituting a legal proceeding against the Issuer, the Preferred Guarantee
Trustee or any other Person.
Section 5.06 GUARANTEE OF PAYMENT.
This Guarantee Agreement creates a guarantee of payment and not of
collection.
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Section 5.07 SUBROGATION.
The Guarantor shall be subrogated to all (if any) rights of the Holders
against the Issuer in respect of any amounts paid to such Holders by the
Guarantor under this Guarantee Agreement; PROVIDED, HOWEVER , that the Guarantor
shall not (except to the extent required by mandatory provisions of law) be
entitled to enforce or exercise any right that it may acquire by way of
subrogation or any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Guarantee Agreement, if, at the time of any such
payment, any amounts are due and unpaid under this Guarantee Agreement. If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders.
Section 5.08 INDEPENDENT OBLIGATIONS.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Guarantee
Agreement notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 5.04 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
Section 6.01 LIMITATION OF TRANSACTIONS.
So long as any Preferred Securities remain outstanding, if there shall
have occurred an Event of Default or an event of default under the
Declaration, then the Guarantor shall not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of its capital stock or (ii) make any payment of
principal of, or interest or premium, if any, on or repay, repurchase or
redeem, or make any sinking fund payment with respect to, any indebtedness of
the Company (including other junior subordinated debt securities) that ranks
PARI PASSU with or junior in right of payment to the Subordinated Debentures
or make any guarantee payments with respect to the foregoing (other than (a)
dividends or distributions in common stock of the Company, (b) redemptions or
purchases of any rights pursuant to the Company's Stock Purchase Rights Plan,
or any successor to such Stock Purchase Rights Plan, and the declaration of a
dividend of such rights or the issuance of preferred stock under such plans
in the future, (c) payments under this Guarantee Agreement, (d) purchases of
common stock related to the issuance of common stock under the Company's
Stock Purchase and Dividend Reinvestment Plan and any of the Company's
benefit plans for its directors, officers or employees and (e) purchases of
common stock required to prevent the loss or secure the renewal or
reinstatement of any government license or franchise held by the Company or
any of its subsidiaries).
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Section 6.02 RANKING.
This Guarantee Agreement will constitute an unsecured obligation of the
Guarantor and will rank (i) subordinate and junior in right of payment to all
other liabilities of the Guarantor (other than the Common Securities Guarantee
or any guarantee now or hereafter entered into by the Guarantor in respect of
any preferred or preference stock of any Affiliate of the Guarantor), (ii) PARI
PASSU with the most senior preferred or preference stock now or hereafter issued
by the Guarantor and with any guarantee now or hereafter entered into by the
Guarantor in respect of any preferred or preference stock of any Affiliate of
the Guarantor, and (iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
Section 7.01 TERMINATION.
This Guarantee Agreement shall terminate upon (i) full payment of the
Redemption Price of all Preferred Securities, (ii) the distribution of the
Subordinated Debentures to the Holders of all Preferred Securities or (iii) full
payment of the amounts payable in accordance with the Declaration upon
liquidation of the Issuer. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder of Preferred Securities must restore payment of
any sums paid under the Preferred Securities or under this Preferred Securities
Guarantee. Notwithstanding anything contained herein to the contrary, the
obligations of the Guarantor set forth in Article VIII hereof shall survive
termination of this Guarantee Agreement or the earlier resignation or removal of
the Preferred Guarantee Trustee.
ARTICLE VIII
INDEMNIFICATION
Section 8.01 EXCULPATION.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Guarantor or any Covered Person
for any loss, damage or claim incurred by reason of any act or omission
performed or omitted by such Indemnified Person in good faith in accordance
with this Guarantee Agreement and in a manner that such Indemnified Person
reasonably believed to be within the scope of the authority conferred on such
Indemnified Person by this Guarantee Agreement or by law, except that an
Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's negligence or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying
in good faith upon the records of the Guarantor and upon such information,
opinions, reports or statements presented to the Guarantor by any Person as
to matters the Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been
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selected with reasonable care by or on behalf of the Guarantor, including
information, opinions, reports or statements as to the value and amount of
the assets, liabilities, profits, losses, or any other facts pertinent to the
existence and amount of assets from which Distributions to Holders of
Preferred Securities might properly be paid.
Section 8.02 INDEMNIFICATION.
(a) To the fullest extent permitted by applicable law, the
Guarantor shall indemnify and hold harmless each Indemnified Person from and
against any loss, damage or claim incurred by such Indemnified Person in
connection with this Guarantee Agreement including without limitation by
reason of any act or omission performed or omitted by such Indemnified Person
in good faith in accordance with this Guarantee Agreement and in a manner
such Indemnified Person reasonably believed to be within the scope of
authority conferred on such Indemnified Person by this Guarantee Agreement,
except that no Indemnified Person shall be entitled to be indemnified in
respect of any loss, damage or claim incurred by such Indemnified Person by
reason of negligence or willful misconduct with respect to such acts or
omissions.
(b) To the fullest extent permitted by applicable law, expenses
(including legal fees) incurred by an Indemnified Person in defending any
claim, demand, action, suit or proceeding shall, from time to time, be
advanced by the Guarantor prior to the final disposition of such claim,
demand, action, suit or proceeding upon receipt by the Guarantor of any
undertaking by or on behalf of the Indemnified Person to repay such amount if
it shall be determined that the Indemnified Person is not entitled to be
indemnified as authorized in Section 8.02(a).
ARTICLE IX
MISCELLANEOUS
Section 9.01 SUCCESSORS AND ASSIGNS.
All guarantees and agreements contained in this Guarantee Agreement
shall bind the successors, assigns, receivers, trustees and representatives
of the Guarantor and shall inure to the benefit of the Holders of the
Preferred Securities then outstanding.
Section 9.02 AMENDMENTS.
Except with respect to any changes that do not adversely affect the
rights of Holders (in which case no consent of Holders will be required),
this Guarantee Agreement may only be amended with the prior approval of the
Holders of at least 66-2/3% in 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 the outstanding Preferred Securities (as
defined in the Declaration). The provisions of Section 12.2 of the
Declaration with respect to meetings or actions by written consent of Holders
of the Trust Securities apply to the giving of such approval. The Preferred
Guarantee Trustee may, but shall have no obligation to, execute and deliver
any amendment to
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this Guarantee Agreement which affects the Preferred Guarantee Trustee's
rights, duties or immunities hereunder or otherwise.
Section 9.03 NOTICES.
All notices provided for in this Guarantee Agreement shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail as follows:
(a) If given to the Preferred Guarantee Trustee, at the Preferred
Guarantee Trustee's mailing address set forth below (or such other address as
the Preferred Guarantee Trustee may give notice of to the Holders of the
Preferred Securities):
IBJ ▇▇▇▇▇▇▇▇ Bank & Trust Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If given to the Guarantor, at the Guarantor's mailing address
set forth below (or such other address as the Guarantor may give notice of to
the Holders of the Preferred Securities):
Nevada Power Company
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
(c) If given to any Holder of Preferred Securities, at the address
set forth in the books and records of the Issuer.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
Section 9.04 BENEFIT.
This Guarantee Agreement is solely for the benefit of the Holders of the
Preferred Securities and, subject to Section 3.01(a), is not separately
transferable from the Preferred Securities.
Section 9.05 GOVERNING LAW.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused this Guarantee Agreement
to be executed by their respective officers thereunto duly authorized, as of the
day and year first above written.
NEVADA POWER COMPANY
By:
----------------------------------
Name:
Title:
IBJ ▇▇▇▇▇▇▇▇ BANK & TRUST COMPANY,
as Preferred Guarantee Trustee
By:
----------------------------------
Name:
Title:
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EXHIBIT C
COMMON SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (this "Guarantee Agreement"), dated as of
__________, 1998, is executed and delivered by Nevada Power Company, a Nevada
corporation (the "Guarantor"), for the benefit of the Holders (as defined
herein) from time to time of the Common Securities (as defined in the
Declaration referred to below) of NVP Capital III, a Delaware business trust
(the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of ____________, 1998, among the Trustees of the Issuer
named therein, the Guarantor as sponsor and the holders from time to time of
securities representing undivided beneficial interests in the assets of the
Issuer, the Issuer is issuing on the date hereof $2,164,950 aggregate stated
liquidation amount of the Issuer's Common Securities designated the _____% Trust
Issued Common Securities (the "Common Securities"), representing beneficial
interests in the assets of the Issuer;
WHEREAS, as incentive for the Holders to purchase the Common Securities,
the Guarantor desires irrevocably and unconditionally to agree, to the extent
set forth in this Guarantee Agreement, to pay to the Holders of the Common
Securities the Guarantee Payments (as defined herein) and to make certain other
payments on the terms and conditions set forth herein; and
WHEREAS, the Guarantor is also executing and delivering a guarantee
agreement on substantially identical terms to this Guarantee Agreement for the
benefit of the holders of the Preferred Securities (the "Preferred Securities
Guarantee") except that if an Event of Default (as defined in the Indenture),
has occurred and is continuing, the rights of Holders of the Common Securities
to receive Guarantee Payments under this Guarantee Agreement are subordinated to
the rights of holders of Preferred Securities to receive Guarantee Payments
under the Preferred Securities Guarantee.
NOW, THEREFORE, in consideration of the purchase by each Holder of Common
Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Guarantee Agreement for the
benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1 DEFINITIONS. In this Guarantee Agreement, unless the
context otherwise requires, the terms set forth below shall have the
following meanings.
(a) Capitalized terms used in this Guarantee Agreement but not
defined in the preamble above have the respective meanings assigned to them in
this Section 1.1;
(b) Terms defined in the Declaration as at the date of execution of
this Guarantee Agreement have the same meaning when used in this Guarantee
Agreement unless otherwise defined in this Guarantee Agreement;
(c) A term defined anywhere in this Guarantee Agreement has the same
meaning throughout;
(d) All references to "this Guarantee Agreement" are to this
Guarantee Agreement as modified, supplemented or amended from time to time;
(e) All references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement unless
otherwise specified; and
(f) A reference to the singular includes the plural and vice versa.
"Guarantee Payments" shall mean the following payments or distributions,
without duplication, with respect to the Common Securities, to the extent not
paid or made by the Issuer: (i) any accumulated and unpaid Distributions which
are required to be paid on such Common Securities to the extent the Issuer shall
have funds available therefor, (ii) the redemption price, including all
accumulated and unpaid Distributions to the date of redemption (the "Redemption
Price") to the extent the Issuer shall have funds available therefor, with
respect to any Common Securities called for redemption by the Issuer, and (iii)
upon a voluntary or involuntary liquidation, dissolution, winding-up or
termination of the Issuer (other than in connection with the distribution of
Subordinated Debentures to the Holders on the redemption of all the Common
Securities upon the redemption or Maturity Date of the Subordinated Debentures),
the lesser of (a) the aggregate of the liquidation amount and all accumulated
and unpaid Distributions on the Common Securities to the date of payment, and
(b) the amount of assets of the Issuer remaining available for distribution to
Holders in liquidation of the Issuer (in either case, the "Liquidation
Distribution").
"Holder" shall mean any holder, as registered on the books and records of
the Issuer, of any Common Securities.
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ARTICLE II
GUARANTEE
Section 2.1 GUARANTEE. The Guarantor irrevocably and unconditionally
agrees to pay in full to the Holders the Guarantee Payments (without
duplication of amounts theretofore paid by the Issuer), as and when due,
regardless of any defense, right of set-off or counterclaim which the Issuer
may have or assert. The Guarantor's obligation to make a Guarantee Payment
may be satisfied by direct payment of the required amounts by the Guarantor
to the Holders or by causing the Issuer to pay such amounts to the Holders.
Section 2.2 WAIVER OF NOTICE AND DEMAND. The Guarantor hereby waives
notice of acceptance of this Guarantee Agreement and of any liability to
which it applies or may apply, presentment, demand for payment, any right to
require a proceeding first against the Issuer or any other Person before
proceeding against the Guarantor, protest, notice of non-payment, notice of
dishonor, notice of redemption and all other notices and demands.
Section 2.3 SUBORDINATION. If an Event of Default (as defined in the
Indenture), has occurred and is continuing, the rights of Holders of the
Common Securities to receive Guarantee Payments under this Guarantee
Agreement are subordinated to the rights of Holders of Preferred Securities
to receive Guarantee Payments under the Preferred Securities Guarantee.
Section 2.4 OBLIGATIONS NOT AFFECTED. The obligations, covenants,
agreements and duties of the Guarantor under this Guarantee Agreement shall
in no way be affected or impaired by reason of the happening from time to
time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of
the performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Common Securities to
be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or
any portion of the Distributions, Redemption Price, Liquidation Distribution
or any other sums payable under the terms of the Common Securities or the
extension of time for the performance of any other obligation under, arising
out of, or in connection with, the Common Securities (other than an extension
of time for payment of Distributions, Redemption Price, Liquidation
Distribution or other sum payable that results from the extension of any
interest payment period on the Subordinated Debentures or any extension of
the maturity date of the Subordinated Debentures permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the part
of the Holders to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Holders pursuant to the terms of the Common
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of debt
of, or other similar proceedings affecting, the Issuer or any of the assets of
the Issuer;
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(e) any invalidity of, or defect or deficiency in the Common
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 2.4 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain
consent of, the Guarantor with respect to the happening of any of the foregoing.
Section 2.5 RIGHTS OF HOLDERS. The Guarantor expressly acknowledges
that any Holder of Common Securities may institute a legal proceeding
directly against the Guarantor to enforce its rights under this Guarantee
Agreement, without first instituting a legal proceeding against the Issuer or
any other Person.
Section 2.6 GUARANTEE OF PAYMENT. This Guarantee Agreement creates a
guarantee of payment and not of collection.
Section 2.7 SUBROGATION OF PAYMENT. The Guarantor shall be
subrogated to all (if any) rights of the Holders of Common Securities against
the Issuer in respect of any amounts paid to such Holders by the Guarantor
under this Guarantee Agreement; PROVIDED, HOWEVER, that the Guarantor shall
not (except to the extent required by mandatory provisions of law) be
entitled to enforce or exercise any rights which it may acquire by way of
subrogation or any indemnity, reimbursement or other agreement, in all cases
as a result of payment under this Guarantee Agreement, if, at the time of any
such payment, any amounts are due and unpaid under this Guarantee Agreement.
if any amount shall be paid to the Guarantor in violation of the preceding
sentence, the Guarantor agrees to hold such amount in trust for the Holders
and to pay over such amount to the Holders.
Section 2.8 INDEPENDENT OBLIGATIONS. The Guarantor acknowledges that
its obligations hereunder are independent of the obligations of the Issuer
with respect to the Common Securities and that the Guarantor shall be liable
as principal and as debtor hereunder to make Guarantee Payments pursuant to
the terms of this Guarantee Agreement notwithstanding the occurrence of any
event referred to in subsections (a) through (g), inclusive, of Section 2.4
hereof.
ARTICLE III
LIMITATION OF TRANSACTIONS; SUBORDINATION
Section 3.1 LIMITATION OF TRANSACTIONS. So long as any Common
Securities remain outstanding, if (A) the Guarantor shall be in default with
respect to its Guarantee Payments or other obligations hereunder, or (B) there
shall have occurred any Event of Default, then the Guarantor shall not (i)
declare or pay any dividends or distributions on, or redeem, purchase,
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acquire or make a liquidation payment with respect to, any of its capital
stock or (ii) make any payment of principal of, or interest or premium, if
any, on or repay, repurchase or redeem, or make any sinking fund payment with
respect to, any indebtedness of the Company (including other junior
subordinated debt securities) that ranks PARI PASSU with or junior in right
of payment to the Subordinated Debentures or make any guarantee payments with
respect to the foregoing (other than (a) dividends or distributions in common
stock of the Company, (b) redemptions or purchases of any rights pursuant to
the Company's Stock Purchase Rights Plan, or any successor to such Stock
Purchase Rights Plan, and the declaration of a dividend of such rights or the
issuance of preferred stock under such plans in the future, (c) payments
under this Guarantee Agreement, (d) purchases of common stock related to the
issuance of common stock under the Company's Stock Purchase and Dividend
Reinvestment Plan and any of the Company's benefit plans for its directors,
officers or employees and (e) purchases of common stock required to prevent
the loss or secure the renewal or reinstatement of any government license or
franchise held by the Company or any of its subsidiaries).
Section 3.2 RANKING. This Guarantee Agreement will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and
junior in right of payment to all other liabilities of the Guarantor (other
than any obligation in respect of the Preferred Securities Guarantee or any
guarantee now or hereafter entered into by the Guarantor in respect of any
preferred or preference stock of any Affiliate of the Guarantor), (ii) PARI
PASSU with the most senior preferred or preference stock now or hereafter
issued by the Guarantor and with any guarantee now or hereafter entered into
by the Guarantor in respect of any preferred or preference stock of any
Affiliate of the Guarantor, and (iii) senior to the Guarantor's common stock.
If an Event of Default (as defined in the Indenture), has occurred and is
continuing, the rights of Holders of the Common Securities to receive
Guarantee Payments under this Guarantee Agreement are subordinated to the
rights of holders of Preferred Securities to receive Guarantee Payments.
ARTICLE IV
TERMINATION
Section 4.1 TERMINATION. This Guarantee Agreement shall terminate
upon full payment of the Redemption Price of all Common Securities, upon the
distribution of the Subordinated Debentures to the Holders of all of the
Common Securities or upon full payment of the amounts payable in accordance
with the Declaration upon liquidation of the Issuer. Notwithstanding the
foregoing, this Guarantee Agreement will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of Common
Securities must restore payment of any sums paid under the Common Securities
or under this Guarantee Agreement.
ARTICLE V
MISCELLANEOUS
Section 5.1 SUCCESSORS AND ASSIGNS. All guarantees and agreements
contained in this Guarantee Agreement shall bind the successors, assigns,
receivers, trustees and representatives of
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the Guarantor and shall inure to the benefit of the Holders of the Common
Securities then outstanding.
Section 5.2 AMENDMENTS. Except with respect to any changes which do
not adversely affect the rights of Holders (in which case no consent of
Holders will be required), this Guarantee Agreement may only be amended with
the prior approval of the Holders of at least 66-2/3% in liquidation amount
of all the outstanding Common Securities. The provisions of Section 12.2 of
the Declaration with respect to meetings of holders of the Trust Securities
apply to the giving of such approval.
Section 5.3 NOTICES. All notices provided for in this Guarantee
Agreement shall be in writing, duly signed by the party giving such notice,
and shall be delivered, telecopied or mailed by registered or certified mail,
as follows:
(a) if given to the Issuer, in care of the Regular Trustees at
the Issuer's mailing address set forth below (or such other address as the
Issuer may give notice of to the Holders of the Common Securities):
NVP Capital III
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if given to the Guarantor, at the Guarantor's mailing
address set forth below (or such other address as the Guarantor may give
notice of to the Holders of the Common Securities):
Nevada Power Company
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
(c) if given to any Holder of Common Securities, at the address
set forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
Section 5.4 BENEFICIARIES. This Guarantee Agreement is solely for
the benefit of the Holders and is not separately transferable from the Common
Securities.
Section 5.5 GOVERNING LAW. THIS GUARANTEE AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
C-6
THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.
NEVADA POWER COMPANY
By:
--------------------
Name:
Title:
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