As filed with the Securities and Exchange Commission on October 3, 1997
REGISTRATION NO. 333-32647
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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WILLAMETTE INDUSTRIES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
OREGON
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)
93-0312940
(I.R.S. EMPLOYER IDENTIFICATION NO.)
WILLAMETTE CAPITAL I
WILLAMETTE CAPITAL II
(EXACT NAME OF REGISTRANTS AS SPECIFIED IN TRUST CERTIFICATES)
DELAWARE
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION OF EACH
REGISTRANT)
Applied For Executive Vice President
(I.R.S. EMPLOYER IDENTIFICATION NOS.)
1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201
(503) 227-5581
(ADDRESS, INCLUDING ZIP CODE, AND
TELEPHONE NUMBER, INCLUDING AREA CODE, OF
PRINCIPAL EXECUTIVE OFFICES OF EACH REGISTRANT)
J. A. Parsons
Executive Vice President
and Chief Financial Officer,
Secretary and Treasurer
1300 S.W. Fifth Avenue, Suite 3800
Portland, Oregon 97201
(503) 227-5581
(NAME AND ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF AGENT FOR SERVICE OF EACH REGISTRANT)
Copies to:
Miller, Nash, Wiener, Hager & Carlsen LLP Sullivan & Cromwell
111 S.W. Fifth Avenue, Suite 3500 444 S. Flower Street, Suite 1200
Portland, Oregon 97204-3699 Los Angeles, California 90071
Attention: John J. DeMott Attention: Alison S. Ressler
Telephone: (503) 224-5858 Telephone: (213) 955-8000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after this Registration Statement becomes effective
depending upon market conditions and other factors.
----------------------------
The registrants hereby amend this registration statement on such date or dates
as may be necessary to delay its effective date until the registrants shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1993 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
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Explanatory note: This registration statement contains two forms of basic
prospectus:
1. A prospectus of all registrants relating to all types of
securities that may be offered hereunder.
2. A prospectus of Willamette Industries, Inc., relating
solely to its senior debt securities registered hereunder.
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<PAGE>
$500,000,000
WILLAMETTE INDUSTRIES, INC.
Senior Debt Securities
Subordinated Debt Securities
Cumulative Preferred Stock
Common Stock
Stock Purchase Contracts
Stock Purchase Units
-----------------
WILLAMETTE CAPITAL I
WILLAMETTE CAPITAL II
Trust Preferred Securities
guaranteed to the extent set forth herein by
WILLAMETTE INDUSTRIES, INC.
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Willamette Industries, Inc. (the "Company") may offer, from time to
time, (i) unsecured senior debt securities ("Senior Debt Securities") consisting
of debentures, notes or other unsecured evidences of indebtedness, (ii)
unsecured subordinated debt securities ("Subordinated Debt Securities")
consisting of debentures, notes and other unsecured evidences of indebtedness
(item (i) or (ii) above being referred to herein as the "Debt Securities"),
(iii) cumulative preferred stock, $.50 par value ("Preferred Stock"), (iv)
common stock, $.50 par value ("Common Stock"), (v) stock purchase contracts or
warrants ("Stock Purchase Contracts") to purchase Preferred Stock or Common
Stock, or (vi) stock purchase units ("Stock Purchase Units"), each representing
ownership of a Stock Purchase Contract together with Debt Securities or Trust
Preferred Securities (as defined below) or debt obligations of third parties,
including U.S. Treasury Securities, securing the holder's obligation to purchase
Common Stock or Preferred Stock under the Stock Purchase Contract, in each case
in one or more series and in amounts, at prices and on terms to be determined at
or prior to the time of sale.
(Continued on next page)
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is October ---, 1997.
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<PAGE>
(Continued from cover)
Willamette Capital I and Willamette Capital II (each, a "Willamette
Trust"), each a statutory business trust formed under the laws of the State of
Delaware, may offer, from time to time, preferred securities representing
undivided beneficial interests in the assets of the respective Willamette Trust
("Trust Preferred Securities"). The payment of periodic cash distributions
("distributions") with respect to Trust Preferred Securities of each of the
Willamette Trusts and the common securities representing undivided beneficial
interests in the assets of the Willamette Trusts ("Common Securities" and,
together with the Trust Preferred Securities, the "Trust Securities") out of
moneys held by each of the Willamette Trusts, and payment on liquidation or
redemption with respect to such Trust Securities, will be guaranteed by the
Company to the extent described herein (each a "Guarantee"). See "Description of
the Trust Securities Guarantees" below. The Company's obligations under the
Trust Securities Guarantees are subordinate and junior in right of payment to
all other liabilities of the Company and rank pari passu with the most senior
preferred stock, if any, issued from time to time by the Company. Subordinated
Debt Securities may be issued and sold from time to time in one or more series
to a Willamette Trust, or a trustee of such Willamette Trust, in connection with
the investment of the proceeds from the offering of Trust Preferred Securities
and Common Securities (as defined herein) of such Willamette Trust. The
Subordinated Debt Securities purchased by a Willamette Trust may be subsequently
distributed pro rata to holders of Trust Preferred Securities and Common
Securities in connection with the dissolution of such Willamette Trust upon the
occurrence of certain events as may be described in an accompanying Prospectus
Supplement.
Specific terms of the particular Senior Debt Securities, Subordinated
Debt Securities, Trust Preferred Securities and related Trust Securities
Guarantees, Stock Purchase Contracts, Stock Purchase Units, Common Stock or
Preferred Stock, in respect of which this Prospectus is delivered (the "Offered
Securities") will be set forth in an accompanying Prospectus Supplement or
Supplements, together with the terms of the offering of the Offered Securities,
the initial price thereof and the estimated net proceeds from the sale thereof.
The Prospectus Supplement will set forth with regard to the particular Offered
Securities, without limitation, the following: (i) in the case of Debt
Securities, the designation, aggregate principal amount, denomination, maturity,
premium, if any, any exchange, conversion, redemption or sinking fund
provisions, interest rate (which may be fixed or variable), the time and method
of calculating interest payments, the right of the Company, if any, to defer
payment or interest on the Subordinated Debt Securities and the maximum length
of such deferral period, put options, if any, public offering price, ranking as
senior or subordinated debt, and other specific terms of the offering, (ii) in
the case of Preferred Stock, the designation of the series of Preferred Stock to
be offered, the number of shares, the rate and frequency of dividends thereon,
the amount of any liquidation preference, any conversion or exchange rights, the
terms of any optional or mandatory redemption provisions, any other preferences,
limitations, and rights of Preferred Stock of such series, the public offering
price, and other terms of offering, (iii) in the case of Common Stock, the
number of shares, the public offering price, and other specific terms of the
offering, (iv) in the case of Trust Preferred Securities, the designation,
number of securities, liquidation preference per security, initial public
offering price, dividend rate (or method of calculation thereof), dates on which
dividends shall be payable and dates from which dividends shall accumulate, any
voting rights, any redemption, exchange or sinking fund provisions, any other
rights, preferences, privileges, limitations or restrictions relating to the
Trust Preferred Securities of a specific series and the terms upon which the
proceeds of the sale of the Trust Preferred Securities will be used to purchase
a specific series of Subordinated Debt Securities of the Company, (v) in the
case of Stock Purchase Contracts, the designation and number of shares of Common
Stock or Preferred Stock issuable thereunder, the purchase price of Common Stock
or Preferred Stock, the date or dates on which the Common Stock or Preferred
Stock is required or permitted to be purchased by the holders of the Stock
Purchase Contracts, any periodic payments required to be made by the Company to
the holders of the
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<PAGE>
Stock Purchase Contract or visa versa, the other terms upon which the Common
Stock or Preferred Stock shall be or may be purchased and sold thereunder, and
the terms of the offering and sale of the Stock Purchase Contracts, and (vi) in
the case of Stock Purchase Units, the number and designation of the Stock
Purchase Contracts and any Debt Securities, Trust Preferred Securities or debt
obligations of third parties securing the holder's obligation to purchase the
Common Stock or Preferred Stock under the Stock Purchase Contracts, and the
terms of the offering and sale thereof.
The Company's Common Stock is traded on the New York Stock Exchange
("NYSE") under the symbol "WLL." See "Description of Willamette Capital Stock --
Price Range of Willamette Common Stock and Common Stock Dividends."
Willamette and/or each of the Willamette Trusts may sell the Offered
Securities directly, through agents designated from time to time or through
underwriters or dealers. See "Plan of Distribution." If any agents of Willamette
and/or any Willamette Trust or any underwriters or dealers are involved in the
sale of the Offered Securities, the names of such agents, underwriters or
dealers and any applicable commissions and discounts will be set forth in the
related Prospectus Supplement.
This Prospectus may not be used to consummate sales of Offered
Securities unless accompanied by a Prospectus Supplement.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, ANY ACCOMPANYING
PROSPECTUS SUPPLEMENT OR THE DOCUMENTS INCORPORATED OR DEEMED INCORPORATED BY
REFERENCE HEREIN, AND ANY INFORMATION OR REPRESENTATIONS NOT CONTAINED HEREIN OR
THEREIN MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE
WILLAMETTE TRUSTS OR BY ANY AGENT, DEALER OR UNDERWRITER. THIS PROSPECTUS AND
ANY ACCOMPANYING PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY CIRCUMSTANCES IN WHICH
SUCH OFFER OR SOLICITATION IS UNLAWFUL. THE DELIVERY OF THIS PROSPECTUS OR ANY
PROSPECTUS SUPPLEMENT AT ANY TIME DOES NOT IMPLY THAT THE INFORMATION HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act") and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "SEC"). Reports, proxy statements and
other information concerning the Company can be inspected and copied at the
SEC's Public Reference Room, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, DC 20549, as well as the Regional Offices of the SEC at 7 World
Trade Center, Suite 1300, New York, New York 10048 and Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511.
Copies of such material can be obtained from the Public Reference Section of the
SEC at Judiciary Plaza, 450 Fifth Street, N.W., Washington, DC 20549, at
prescribed rates. The SEC also maintains a Web site that contains reports, proxy
and information statements and other information regarding registrants that file
electronically with the SEC. The address of such site is http://www.sec.gov.
Such reports, proxy statements and other information may also be inspected at
the offices of the NYSE, on which Common Stock is traded, at 20 Broad Street,
New York, New York 10005.
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<PAGE>
This Prospectus constitutes a part of a Registration Statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") filed by the Company and the Willamette Trusts with the SEC under
the Securities Act of 1933, as amended (the "Securities Act") with respect to
the Offered Securities. This Prospectus does not contain all of the information
set forth in such Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the SEC. Reference is made to such
Registration Statement and to the exhibits relating thereto for further
information with respect to the Company, the Willamette Trusts, and the Offered
Securities. Any statements contained herein concerning the provisions of any
document filed as an exhibit to the Registration Statement or otherwise filed
with the SEC or incorporated by reference herein are not necessarily complete,
and in each instance reference is made to the copy of such document so filed for
a more complete description of the matter involved. Each such statement is
qualified in its entirety by such reference.
No separate financial statements of any of the Willamette Trusts have
been included herein. The Company does not consider that such financial
statements would be material to holders of the Trust Preferred Securities
because (i) all of the voting securities of each of the Willamette Trusts will
be owned, directly or indirectly, by the Company, a reporting company under the
Exchange Act, (ii) each of the Willamette Trusts has no independent operations
but exists for the sole purpose of issuing securities representing undivided
beneficial interests in the assets of such Willamette Trust and investing the
proceeds thereof in Subordinated Debt Securities issued by the Company, and
(iii) the Company's obligations described herein and in any accompanying
prospectus supplement under the Declarations of Trust and Trust Agreement
("Declarations") of each Trust, the Guarantee issued with respect to Trust
Securities issued by that Trust, the Subordinated Debt Securities purchased by
that Trust and the related Indenture, taken together, constitute a full and
unconditional guarantee of payments due on the Trust Securities. See "Particular
Terms of the Subordinated Debt Securities" and "Description of the Trust
Securities Guarantees."
The Willamette Trusts are not currently subject to the information
reporting requirements of the 1934 Act. The Willamette Trusts will become
subject to such requirements upon the effectiveness of the Registration
Statement, although they intend to seek and expect to receive exemptions
therefrom.
The Company will send to all registered holders of the Offered
Securities such annual and other reports as are sent to its shareholders in
conformity with the requirements of the 1934 Act.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the SEC pursuant to
the 1934 Act are incorporated by reference herein and made a part hereof:
1. Annual Report on Form 10-K for the year ended December 31,
1996.
2. The Company's quarterly reports on Form 10-Q for the quarters
ended March 31, 1997, and June 30, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the 1934 Act subsequent to the date hereof and prior to the
termination of the offering of the Offered Securities pursuant hereto shall be
deemed to be incorporated by reference in this Prospectus or in any Prospectus
Supplement and to be a part hereof from the date of filing of such documents.
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<PAGE>
Any statement contained herein or in a document incorporated or deemed
to be incorporated by reference in this Prospectus or in any Prospectus
Supplement shall be deemed to be modified or superseded for purposes of this
Prospectus or any Prospectus Supplement to the extent that a statement contained
in this Prospectus or in any Prospectus Supplement or in any other subsequently
filed document which also is or is deemed to be incorporated by reference in
this Prospectus or in any Prospectus Supplement modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus or any
Prospectus Supplement.
The Company undertakes to provide without charge to each person to whom
a copy of this Prospectus has been delivered, upon the written or oral request
of any such person, a copy of any or all of the foregoing documents incorporated
herein by reference, other than exhibits to such documents (unless such exhibits
are specifically incorporated by reference into such documents). Such requests
should be directed to: Willamette Industries, Inc., 1300 S.W. Fifth Avenue,
Suite 3800, Portland, Oregon 97201, Telephone: (503) 227-5581, Attention:
Investor Relations.
THE COMPANY
The Company is a diversified, integrated forest products company which
manufactures unbleached paper products, white paper products, and wood-based
building materials at 97 locations located throughout the United States and in
Ireland. The Company owns or controls approximately 1.8 million acres of
timberland in Arkansas, Louisiana, Missouri, North Carolina, Oregon, South
Carolina, Tennessee, Texas, and Washington.
The Company was incorporated in Oregon in 1906. Its executive offices
are located at 1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201, and
its telephone number is (503) 227-5581.
THE WILLAMETTE TRUSTS
Each of Willamette Capital I and Willamette Capital II is a statutory
business trust formed under Delaware law in 1997 pursuant to (i) a separate
Declaration executed by the Company, as sponsor for such trust (the
"Depositor"), and the Willamette Trustees (as defined herein) for such trust and
(ii) the filing of a certificate of trust with the Delaware Secretary of State.
Each Willamette Trust exists for the exclusive purposes of (i) issuing the Trust
Securities, (ii) investing the gross proceeds of the Trust Securities in Debt
Securities and (iii) engaging in only those other activities necessary or
incidental thereto. All of the Common Securities will be directly or indirectly
owned by the Company. The Common Securities will rank pari passu, and payments
will be made thereon pro rata, with the Trust Preferred Securities except that
upon an event of default under the Declaration which results from an Event of
Default under the Indenture, the rights of the holders of the Common Securities
to payment in respect of distributions and payments upon liquidation, redemption
and otherwise will be subordinated to the rights of the holders of the Trust
Preferred Securities. The Company will, directly or indirectly, acquire Common
Securities of each Willamette Trust. Each Willamette Trust's business and
affairs will be conducted by the trustees (the "Willamette Trustees") appointed
by the Company, as the direct or indirect holder of all the Common Securities.
Except in certain limited circumstances, the holder of the Common Securities
will be entitled to appoint, remove or replace any of, or increase or reduce the
number of, the Willamette Trustees of a Willamette Trust. The duties and
obligations of the Willamette Trustees shall be governed by the Declaration of
such Willamette Trust. A majority of the Willamette Trustees (the
"Administrative Trustees") of each Willamette Trust will be persons who are
employees or officers of or affiliated with the Company. In certain limited
circumstances set forth in a Prospectus
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<PAGE>
Supplement, the holders of a majority of the Trust Preferred Securities will be
entitled to appoint a Trustee, who need not be an employee or officer of or
otherwise affiliated with the Company. One Willamette Trustee of each Willamette
Trust will be a financial institution which will be unaffiliated with the
Company and which shall act as property trustee and as indenture trustee for
purposes of the Trust Indenture Act of 1939 (the "Trust Indenture Act"),
pursuant to the terms set forth in a Prospectus Supplement (the "Property
Trustee" or the "Institutional Trustee"). In addition, unless the Property
Trustee maintains a principal place of business in the State of Delaware, and
otherwise meets the requirements of applicable law, one Willamette Trustee of
each Willamette Trust will have its principal place of business or reside in the
State of Delaware (the "Delaware Trustee"). The Company will pay all fees and
expenses related to the Willamette Trusts and the offering of Trust Securities,
the payment of which will be guaranteed by the Company. The office of the
Delaware Trustee for each Willamette Trust in the State of Delaware is Chase
Manhattan Bank Delaware, 1201 North Market Street, Wilmington, Delaware 19801.
The principal place of business of each Willamette Trust shall be c/o Willamette
Industries, Inc., Attention: Chief Financial Officer, 1300 S.W. Fifth Avenue,
Suite 3800, Portland, Oregon 97201, telephone: (503) 227-5581.
USE OF PROCEEDS
Unless otherwise indicated in a Prospectus Supplement with respect to
the proceeds from the sale of the particular Offered Securities to which such
Prospectus Supplement relates, the Company intends to add the net proceeds
received by it from the sale of Offered Securities to its general funds, to be
used for general corporate purposes, including capital expenditures, working
capital, and repayment of debt. Each Willamette Trust will use the net proceeds
received by it from the sale of Trust Preferred Securities to purchase Debt
Securities from the Company.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's ratio of earnings to fixed
charges for the periods indicated.
<TABLE>
<CAPTION>
Six Months
Ended June 30, Year Ended December 31,
-------------- -------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 1996 1996 1995 1994 1993 1992
Ratio of Earnings to Fixed
Charges (1)(2)............... 1.59 5.46 3.68 10.83 4.25 3.06 2.56
</TABLE>
(1) The Company has authority to issue up to 5,000,000 shares of Preferred
Stock; there are currently no shares outstanding and the Company
currently does not have a Preferred Stock dividend obligation.
Therefore, the Ratio of Combined Earnings to Fixed Charges and
Preferred Stock Dividends is equal to the Ratio of Earnings to Fixed
Charges and is not disclosed separately.
(2) For purposes of computing the ratio, "earnings" consist of income
before income taxes, plus fixed charges. "Fixed charges" consist of
interest expense plus one-third of rent expense (which is deemed
representative of an interest factor).
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<PAGE>
DESCRIPTION OF THE COMPANY'S DEBT SECURITIES
The particular terms of the Debt Securities offered by any Prospectus
Supplement and the extent, if any, to which such general provisions may apply to
the Debt Securities so offered will be described in the Prospectus Supplement
relating to such Debt Securities.
The Debt Securities may be issued, from time to time, in one or more
series and will constitute either Senior Debt Securities or Subordinated Debt
Securities. Senior Debt Securities will be issued under an Indenture dated
January 30, 1993 (the "Senior Debt Securities Indenture"), between the Company
and The Chase Manhattan Bank, as trustee (the "Senior Debt Securities Trustee").
The Subordinated Debt Securities will be issued under an Indenture (the
"Subordinated Debt Securities Indenture") to be entered into between the Company
and the Subordinated Debt Securities Trustee.
The Senior Debt Securities Indenture and the Subordinated Debt
Securities Indenture are referred to herein individually as an "Indenture" and,
collectively, as the "Indentures," and the Senior Debt Securities Trustee and
the Subordinated Debt Securities Trustee are referred to herein as the
"Trustee."
The following summaries of certain provisions of the Debt Securities
and the Indentures do not purport to be complete and are subject to, and are
qualified in their entirety by express reference to, all the provisions of the
Indentures, including the definitions therein of certain terms. Certain
capitalized terms herein are defined in the Indentures.
GENERAL
The Debt Securities will be unsecured obligations of the Company. The
Indentures do not limit the aggregate principal amount of Debt Securities which
may be issued thereunder and provide that Debt Securities may be issued
thereunder, from time to time, in one or more series.
The Prospectus Supplement relating to the Debt Securities being offered
(the "Offered Debt Securities") will specify, among other things: (1) the title
of the Offered Debt Securities; (2) any limit on the aggregate principal amount
of the Offered Debt Securities; (3) the date or dates on which the Offered Debt
Securities will mature; (4) the rate or rates (which may be fixed or variable)
per annum at which the Offered Debt Securities will bear interest or the method
by which such rate or rates shall be determined and the date from which such
interest will accrue or the method by which such date shall be determined; (5)
the dates on which any such interest will be payable and the Regular Record
Dates for such Interest Payment Dates; (6) the dates, if any, on which, and the
price or prices at which, the Offered Debt Securities may, pursuant to any
mandatory or optional sinking fund provisions, be redeemed by the Company and
other detailed terms and provisions of such sinking funds; (7) the date, if any,
after which, and the price or prices at which, the Offered Debt Securities may,
pursuant to any optional redemption provisions, be redeemed at the option of the
Company or of the Holder thereof and other detailed terms and provisions of such
optional redemption; (8) the right of the Company, if any, to defer payment of
interest on the Offered Debt Securities and the maximum length of any such
deferral period; (9) the right of Holders, if any, to put the Offered Debt
Securities to the Company; (10) the currency unit, if other than United States
dollars, of payment of principal, and premium and interest, if any, on the
Offered Debt Securities; (11) the applicability of certain provisions of the
Indentures as described under "Defeasance and Covenant Defeasance"; and (12) any
other terms of the Offered Debt Securities (which terms shall not be
inconsistent with the Indenture).
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the principal of, and any premium or interest, if any, on, the Offered
Debt Securities will be payable, and the Offered Debt
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<PAGE>
Securities will be exchangeable and transfers thereof will be registrable, at
the Place of Payment, provided that, at the option of the Company, payment of
interest may be made by check mailed to the address of the person entitled
thereto as it appears in the Security Register.
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the Offered Debt Securities will be issued in United States dollars in
fully registered form, without coupons, in denominations of $1,000 or any
integral multiple thereof. No service charge will be made for any transfer or
exchange of the Offered Debt Securities, but the Company may require payment of
a sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
CERTAIN COVENANTS OF THE COMPANY
For purposes of the descriptions of both the Senior Debt Securities and
the Subordinated Debt Securities, certain defined terms have the following
meanings:
"Subsidiary" of the Company is defined as a corporation more than 50%
of the outstanding voting stock of which is owned, directly or indirectly, by
the Company and/or one or more Subsidiaries of the Company. "Restricted
Subsidiary" is defined as a Subsidiary of the Company substantially all the
property of which is located, or substantially all the business of which is
carried on, within the present 50 states of the United States or in Canada and
which owns a Principal Property, excluding, however, any Subsidiary of the
Company which is primarily engaged in the development and sale or financing of
real property. "Principal Property" is defined as (i) any mill, converting
plant, manufacturing plant or other facility owned by the Company or a
Restricted Subsidiary which is located within the present 50 states of the
United States or in Canada and the gross book value of which (without deduction
of any depreciation reserves) on the date as of which the determination is made
exceeds 1% of Consolidated Net Tangible Assets, and (ii) Timberlands other than
those being held primarily for development or sale; such property, however, will
exclude (a) any property which in the opinion of the Board of Directors of the
Company is not of material importance to the total business conducted by the
Company and its Restricted Subsidiaries as an entirety or (b) any portion of a
particular property which is similarly found not to be of material importance to
the use or operation of such property or (c) any oil, gas or other minerals or
mineral rights. "Attributable Debt" is defined as the total net amount of rent
required to be paid during the remaining primary term of certain leases,
discounted at the rate of 15% per annum. "Consolidated Net Tangible Assets" is
defined as the aggregate amount of assets after deducting (i) all liabilities,
other than deferred income taxes, Funded Debt and shareholders' equity, and (ii)
goodwill and like intangibles, of the Company and its consolidated Subsidiaries.
"Funded Debt" is defined as all indebtedness for money borrowed having a
maturity of more than 12 months from the date as of which the determination is
made (or being renewable beyond such period) and rental obligations (at the
amount capitalized) payable more than 12 months from such date under capitalized
leases.
Restrictions on Secured Debt
The Indentures provide that the Company may not, nor may it permit any
Restricted Subsidiary to, create, assume or guarantee any loan or evidence of
indebtedness for money borrowed ("Debt") secured by a mortgage, pledge or lien
("Mortgage") on any Principal Property of the Company or any Restricted
Subsidiary, or on any share of Capital Stock or Debt of any Restricted
Subsidiary, without securing or causing such Restricted Subsidiary to secure the
Debt Securities equally and ratably with (or, at the Company's option, prior to)
such secured Debt, unless the aggregate amount of all such secured Debt,
together with all Attributable Debt with respect to sale and leaseback
transactions involving Principal Properties (with the exception of such
transactions which are excluded as described in
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<PAGE>
"Restrictions on Sale of Leaseback Transactions" below), would not exceed 10% of
Consolidated Net Tangible Assets.
This restriction does not apply to, and there shall be excluded from
secured Debt in any computation under such restriction, Debt secured by: (a)
Mortgages on property of, or on any shares of Capital Stock of or Debt of, any
corporation existing at the time such corporation becomes a Restricted
Subsidiary, (b) Mortgages in favor of the Company or a Restricted Subsidiary,
(c) Mortgages in favor of governmental bodies to secure progress or advance
payments, (d) Mortgages on property, shares of stock or Debt existing at the
time of acquisition thereof (including acquisition through merger or
consolidation) and purchase money and construction Mortgages which are entered
into within specified time limits, (e) Mortgages securing industrial revenue or
pollution control bonds, and (f) any extension, renewal or refunding of any
Mortgages referred to in the foregoing clauses (a) through (e), inclusive.
Restrictions on Sale and Leaseback Transactions
The Indentures provide that neither the Company nor any Restricted
Subsidiary may enter into any sale and leaseback transaction involving any
Principal Property, unless the aggregate amount of all Attributable Debt with
respect to such sale and leaseback transactions, plus all secured Debt (with the
exception of secured Debt which is excluded as described in "Restrictions on
Secured Debt" above), would not exceed 10% of Consolidated Net Tangible Assets.
This restriction does not apply to, and there shall be excluded from
Attributable Debt in any computation under such restriction, any sale and
leaseback transaction if (a) the lease is for a period, including renewal
rights, of not in excess of three years, (b) the sale or transfer of the
Principal Property is made within a specified period after its acquisition or
construction, (c) the lease secures or relates to industrial revenue or
pollution control bonds, (d) the transaction is between the Company and a
Restricted Subsidiary or between Restricted Subsidiaries or (e) the Company or
such Restricted Subsidiary, within 180 days after the sale is completed, applies
to the retirement of Funded Debt of the Company or a Restricted Subsidiary, or
the purchase of other property which will constitute Principal Property of a
value at least equal to the value of the Principal Property leased, an amount
not less than the greater of (i) the net proceeds of the sale of the Principal
Property leased or (ii) the fair market value of the Principal Property leased;
provided that the amount of proceeds to be applied to the retirement of Funded
Debt shall be reduced by an amount, if any, equal to the principal amount of
debentures or notes (including the Debt Securities) of the Company or a
Restricted Subsidiary surrendered for cancellation to the applicable trustee
thereof and the principal amount of other Funded Debt voluntarily retired, in
each case within 180 days after such sale.
Restrictions on Funded Debt of Restricted Subsidiaries
The Indentures provide that the Company may not permit any Restricted
Subsidiary to create, assume or guarantee any Funded Debt except (i) Funded Debt
owed to the Company or a Restricted Subsidiary, (ii) Funded Debt secured by
Mortgages permitted as described under "Restrictions on Secured Debt," (iii)
Funded Debt of any corporation outstanding at the time such corporation became a
Restricted Subsidiary, (iv) Funded Debt of any person outstanding at the time of
its acquisition, or the acquisition of substantially all its properties, by such
Restricted Subsidiary, (v) Funded Debt incurred in connection with certain
refundings, (vi) Funded Debt constituting Attributable Debt permitted as
described under "Restrictions on Sale and Leaseback Transactions" and (vii) any
other Funded Debt if the aggregate principal amount of all Funded Debt of all
Restricted Subsidiaries permitted under this clause (vii) does not exceed 10% of
Consolidated Net Tangible Assets.
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EVENTS OF DEFAULT
The following are Events of Default under the Indentures with respect
to the Debt Securities of any series: (a) default in the payment of principal of
or any premium on any Debt Security of that series when due; (b) default in the
payment of any interest on any Debt Security of that series when due continued
for 30 days; (c) default in the deposit of any sinking fund payment, when due,
in respect of any Debt Security of that series; (d) default in the performance
of any other covenant of the Company in the Indentures (other than a covenant
included in the Indentures solely for the benefit of a series of the Debt
Securities other than that series), continued for 90 days after written notice
as provided in the Indenture; (e) certain events in bankruptcy, insolvency or
reorganization; and (f) any other Event of Default provided with respect to Debt
Securities of a particular series. No Event of Default with respect to the Debt
Securities of a particular series necessarily constitutes an Event of Default
with respect to the Debt Securities of any other series.
If an Event of Default with respect to the Debt Securities of any
series at the time Outstanding occurs and is continuing, either the Trustee or
the Holders of at least 25% in aggregate principal amount of the Outstanding
Debt Securities of that series may declare the principal amount (or, if the Debt
Securities of that series are original issue discount Debt Securities, such
portion of the principal amount as may be specified in the terms of that series)
of all the Debt Securities of that series to be due and payable immediately. At
any time after a declaration of acceleration with respect to the Debt Securities
of any series has been made, but before a judgment or decree based on
acceleration has been obtained, the Holders of a majority in principal amount of
the Outstanding Debt Securities of that series may, under certain circumstances,
rescind and annul such acceleration.
The Indentures provide that, subject to the duty of the Trustee during
the continuance of an Event of Default to act with the required standard of
care, the Trustee will be under no obligation to exercise any of its rights or
powers under the Indenture at the request or direction of any of the Holders,
unless such Holders shall have offered to the Trustee reasonable indemnity.
Subject to such provisions for the indemnification of the Trustee, the Holders
of a majority in principal amount of the Outstanding Debt Securities of any
series will have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee, with respect to the Debt Securities of that
series. The right of a Holder of any Debt Security to institute a proceeding
with respect to the Indenture is subject to certain conditions precedent, but
each Holder has an absolute right to receive payment of principal or premium and
interest, if any, when due and to institute suit for the enforcement of any such
payment.
The Company is required to furnish to the Trustee annually a statement
as to the performance by the Company of its obligations under the Indentures and
as to any default in such performance.
The Debt Securities may be issued under the Indentures as Original
Issue Discount Securities to be offered and sold at a substantial discount below
their principal amount. Special federal income tax, accounting and other
considerations applicable to any such Original Issue Discount Securities will be
described in any Prospectus Supplement relating thereto. "Original Issue
Discount Security" means any security which provides for an amount less than the
principal amount thereof to be due and payable upon a declaration of
acceleration of the maturity thereof as a result of the occurrence of an Event
of Default and the continuation thereof.
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BOOK-ENTRY DEBT SECURITIES
The Debt Securities of a series may be issued in whole or in part in
the form of one or more Global Securities (as such term is defined below) that
will be deposited with, or on behalf of, a Depositary ("Depositary") or its
nominee identified in the applicable Prospectus Supplement. In such a case, one
or more Global Securities will be issued in a denomination or aggregate
denomination equal to the portion of the aggregate principal amount of
outstanding Debt Securities of the series to be represented by such Global
Security or Global Securities. Unless and until it is exchanged in whole or in
part for Debt Securities in registered form, a Global Security may not be
registered for transfer or exchange except as a whole by the Depositary for such
Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any nominee to a successor Depositary or a nominee of such
successor Depositary and except in the circumstances described in the applicable
Prospectus Supplement. The term "Global Security", when used with respect to any
series of Debt Securities, means a Debt Security that is executed by the Company
and authenticated and delivered by the Trustee to the Depositary or pursuant to
the Depositary's instruction, which shall be registered in the name of the
Depositary or its nominee and which shall represent, and shall be denominated in
an amount equal to the aggregate principal amount of, all of the Outstanding
Debt Securities of such series or any portion thereof, in either case having the
same terms, including, without limitation, the same original issue date, date or
dates on which principal is due, and interest rate or method of determining
interest.
The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Global Security
will be described in the applicable Prospectus Supplement. The Company expects
that the following provisions will apply to depositary arrangements. Unless
otherwise specified in the applicable Prospectus Supplement, Debt Securities
which are to be represented by a Global Security to be deposited with or on
behalf of a Depositary will be represented by a Global Security registered in
the name of such Depositary or its nominee. Upon the issuance of such Global
Security, and the deposit of such Global Security with or on behalf of the
Depositary for such Global Security, the Depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts of
the Debt Securities represented by such Global Security to the accounts of
institutions that have accounts with such Depositary or its nominee
("participants"). The accounts to be credited will be designated by the
underwriters or agents of such Debt Securities or, if such Debt Securities are
offered and sold directly by the Company, by the Company. Ownership of
beneficial interests in such Global Security will be limited to participants or
Persons that may hold interests through participants. Ownership of beneficial
interests by participants in such Global Security will be shown on, and the
transfer of that ownership interest will be effected only through, records
maintained by the Depositary or its nominee for such Global Security. Ownership
of beneficial interests in such Global Security by Persons that hold through
participants will be shown on, and the transfer of that ownership interest
within such participant will be effected only through, records maintained by
such participant. The laws of some jurisdictions require that certain purchasers
of securities take physical delivery of such securities in certificated form.
The foregoing limitations and such laws may impair the ability to transfer
beneficial interests in such Global Securities.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or Holder of the Securities
represented by such Global Security for all purposes under the Indenture. Unless
otherwise specified in the applicable Prospectus Supplement, owners of
beneficial interests in such Global Security will not be entitled to have Debt
Securities of the series represented by such Global Security registered in their
names, will not receive or be entitled to receive physical delivery of Debt
Securities of such series in certificated form and will not be considered the
Holders thereof for any
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purposes under the Indenture. Accordingly, each Person owning a beneficial
interest in such Global Security must rely on the procedures of the Depositary
and, if such Person is not a participant, on the procedures of the participant
through which such Person owns its interest, to exercise any rights of a Holder
under the Indenture. The Company understands that under existing industry
practices, if the Company requests any action of Holders or an owner of a
beneficial interest in such Global Security desires to give any notice or take
any action a Holder is entitled to give or take under the Indenture, the
Depositary would authorize the participants to give such notice or take such
action, and participants would authorize beneficial owners owning through such
participants to give such notice or take such action or would otherwise act upon
the instructions of beneficial owners owning through them.
Principal of and any premium and interest on a Global Security will be
payable in the manner described in the applicable Prospectus Supplement.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of the Holders of any of the
Outstanding Debt Securities under the Indentures, may consolidate with or merge
into, or transfer its assets substantially as an entirety to, any corporation
organized under the laws of any domestic jurisdiction, and any other person may
consolidate with, or merge into, or transfer its assets substantially as an
entirety to the Company provided that (i) the successor corporation (if any)
assumes the Company's obligations on the Debt Securities and under the
Indentures, (ii) after giving effect to the transaction and treating any
indebtedness which becomes an obligation of the Company or a Subsidiary as a
result of such transaction as having been incurred by the Company or the
Subsidiary at the time of such transaction, no Event of Default, and no event
which, after notice or lapse of time, would become an Event of Default, shall
have occurred and be continuing, (iii) if as a result of the transaction a
Principal Property would become subject to a Mortgage which would not be
permitted by the Indentures, the Debt Securities shall be secured equally with
(or prior to) the indebtedness secured thereby, and (iv) certain other
conditions are met.
DEFEASANCE AND COVENANT DEFEASANCE
The Indentures provide, if such provision is made applicable to the
Debt Securities of any series (which will be indicated in the Prospectus
Supplement) that the Company may elect either (a) to defease and be discharged
from any and all obligations in respect of the Debt Securities of such series
(except for certain obligations to register the transfer or exchange of Debt
Securities of such series, to replace mutilated, destroyed, lost or stolen Debt
Securities of such series, to maintain paying agencies and to hold moneys for
payment in trust) ("defeasance") or (b) to be released from its obligations with
respect to the Debt Securities of such series under certain restrictive
covenants of the Indenture, including those described under "Certain Covenants
of the Company," and "Consolidation, Merger and Sale of Assets" ("covenant
defeasance") and the occurrence of an event described in clause (d) under
"Events of Default" shall no longer be an Event of Default with respect to the
Debt Securities of such series, in each case, if the Company deposits, in trust,
with the Trustee money and/or Government Obligations, which through the payment
of interest thereon and principal thereof in accordance with their terms will
provide money in an amount sufficient, without reinvestment, to pay the
principal of and any premium and interest on the Outstanding Debt Securities of
such series and any mandatory sinking fund payments or analogous payments in
accordance with the terms of the Outstanding Debt Securities of such series and
the Indentures. Such a trust may only be established if, among other things, (i)
no Event of Default or event which with the giving of notice or lapse of time,
or both, would become an Event of Default with respect to such series under the
Indentures shall have occurred and be continuing on the date of such deposit,
(ii) such deposit will not cause the Trustee to have any conflicting interest
with respect to other securities of the Company and (iii) the Company shall have
delivered an Opinion of Counsel to the effect that the
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Holders will not recognize income, gain or loss for federal income tax purposes
as a result of such defeasance and will be subject to federal income tax on the
same amounts, in the same manner, and at the same times as if such defeasance
had not occurred. In the event the Company exercises its covenant defeasance
option with respect to the Debt Securities of any series and the Debt Securities
of such series are declared due and payable because of the occurrence of any
Event of Default, the amount of money and Government Obligations on deposit with
the Trustee will be sufficient to pay amounts due on the Debt Securities of such
series at the time of their Stated Maturity but may not be sufficient to pay
amounts due on the Debt Securities of such series at the time of the
acceleration resulting from such Event of Default. However, the Company will
remain liable with respect to such payments.
MODIFICATION AND WAIVER
Modifications and amendments of the Indentures may be made by the
Company and the Trustee with the consent of the Holders of a majority in
principal amount of the Outstanding Debt Securities of each series affected by
such modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Debt
Security affected thereby, (a) change the stated maturity date of the principal
of, or any installment of principal of or interest, if any, on, any Debt
Security, (b) reduce the principal amount of, or premium or rate of interest, if
any, on, any Debt Security, (c) reduce the amount of principal of an original
issue discount Debt Security payable upon acceleration of the maturity thereof,
(d) change the place or currency of payment of principal of, or premium or
interest, if any, on, any Debt Security, (e) impair the right to institute suit
for the enforcement of any payment on or with respect to any Debt Security, (f)
change the provisions for defeasance or covenant defeasance (each as defined
below) made applicable to any Debt Security, or (g) reduce the percentage in
principal amount of Outstanding Debt Securities of any series, the consent of
whose Holders is required for modification or amendment of the Indentures or for
waiver of compliance with certain provisions of the Indenture or for waiver of
certain defaults.
The Holders of a majority in principal amount of the Outstanding Debt
Securities of each series may, on behalf of all Holders of the Debt Securities
of that series, waive, insofar as that series is concerned, compliance by the
Company with certain restrictive provisions of the Indentures. The Holders of a
majority in aggregate principal amount of the Outstanding Debt Securities of
each series may, on behalf of all Holders of the Debt Securities of that series,
waive any past default under the Indentures with respect to the Debt Securities
of that series, except a default in the payment of principal, or premium or
interest, if any, or in respect of a covenant or condition which cannot be
waived without the consent of each Holder of the Debt Securities of that series.
REGARDING THE TRUSTEE
The Company maintains deposit accounts and conducts other banking
transactions with The Chase Manhattan Bank in the ordinary course of the
Company's business. The Chase Manhattan Bank serves as trustee under another
indenture with respect to certain of the Company's other senior debt securities.
PARTICULAR TERMS OF THE SENIOR DEBT SECURITIES
The particular terms of the Senior Debt Securities offered by any
Prospectus Supplement and the extent, if any, to which the general provisions
applicable to Debt Securities as described above may apply to the Senior Debt
Securities so offered will be described in the Prospectus Supplement relating to
such Senior Debt Securities.
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PARTICULAR TERMS OF THE SUBORDINATED DEBT SECURITIES
The particular terms of the Subordinated Debt Securities offered by any
Prospectus Supplement and the extent, if any, to which the general provisions
applicable to Debt Securities as described above may apply will be described in
the Prospectus Supplement relating to such Subordinated Debt Securities.
For purposes of the description of the Subordinated Debt Securities,
certain defined terms have the following meanings:
"Senior Indebtedness" will include the principal of and premium, if
any, and interest on the following, whether outstanding on the date of execution
of the Subordinated Debt Securities Indenture or thereafter incurred or created:
(i) indebtedness of the Company for money borrowed by the Company (including
purchase money obligations with an original maturity in excess of one year) or
evidenced by debentures (other than the Subordinated Debt Securities), notes,
bankers' acceptances or other corporate debt securities or similar instruments
issued by the Company; (ii) obligations with respect to letters of credit; (iii)
indebtedness of the Company constituting a guarantee of indebtedness of others
of the type referred to in the preceding clauses (i) and (ii); or (iv) renewals,
extensions or refundings of any of the indebtedness referred to in the preceding
clauses (i), (ii) and (iii) unless, in the case of any particular indebtedness,
renewal, extension or refunding, under the express provisions of the instrument
creating or evidencing the same, or pursuant to which the same is outstanding,
such indebtedness or such renewal, extension or refunding thereof is not
superior in right of payment to the Subordinated Debt Securities. "Senior
Indebtedness" may also include other types or classes of indebtedness as
specified in the applicable Prospectus Supplement.
SUBORDINATION
The payment of the principal of, premium, if any, and interest on the
Subordinated Debt Securities will be subordinated in right of payment to the
prior payment in full of all Senior Indebtedness of the Company. No payment on
account of principal of, premium, if any, or interest on the Subordinated Debt
Securities and no acquisition of, or payment on account of any sinking fund for,
the Subordinated Debt Securities may be made unless full payment of amounts then
due for principal, premium, if any, and interest then due on all Senior
Indebtedness by reason of the maturity thereof (by lapse of time, acceleration
or otherwise) has been made or duly provided for in cash or in a manner
satisfactory to the Holders of such Senior Indebtedness. The Subordinated Debt
Securities Indenture provisions do not prevent the Company from making a sinking
fund payment with Subordinated Debt Securities acquired prior to the maturity of
Senior Indebtedness or, in the case of default, prior to such default and notice
thereof. Upon any distribution of its assets in connection with any dissolution,
liquidation or reorganization of the Company, all Senior Indebtedness must be
paid in full before the Holders of the Subordinated Debt Securities are entitled
to any payments whatsoever. As a result of these subordination provisions, in
the event of the Company's insolvency, holders of the Subordinated Debt
Securities may recover ratably less than senior creditors and other creditors of
the Company. Additional provisions applicable to the subordination of
Subordinated Debt Securities may be described in the applicable Prospectus
Supplement.
In the case of Subordinated Debt Securities issued to a Willamette
Trust, in the event of the failure of the Company to pay interest or principal,
then a holder of Trust Preferred Securities of such Willamette Trust may
directly institute a proceeding against the Company for payment.
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DESCRIPTION OF PREFERRED STOCK AND COMMON STOCK
The authorized capital stock of the Company consists of 5,000,000
shares of Preferred Stock issuable in series, and 150,000,000 shares of Common
Stock.
The board of directors of the Company is authorized to divide the
Preferred Stock into series and to determine the preferences, limitations and
relative rights of each series. The preferences, limitations, and relative
rights of any series of Preferred Stock offered by any Prospectus Supplement
(including, without limitation, the designation and seniority and number of
shares, the rate and time of payment of dividends, if any, thereon (or method of
computing the same), the amount of any liquidation preference, any rights of
conversion or exchange, voting rights, if any, and any optional or mandatory
redemption provisions) will be described in the applicable Prospectus
Supplement.
The board of directors has established a series of Preferred Stock
designated as Series A Junior Participating Preferred Stock ("Series A Preferred
Stock"), comprising 500,000 shares of Preferred Stock. Subject to superior
rights of any other outstanding Preferred Stock, each share of Series A
Preferred Stock is entitled to receive, in preference to the Common Stock,
quarterly cumulative dividends equal to 400 times the quarterly dividend paid
with respect to each share of Common Stock, but not less than $1.00. Each share
of Series A Preferred Stock is entitled to 400 votes on all matters submitted to
a vote of the shareholders. In the event of liquidation of the Company, each
share of Series A Preferred Stock is entitled to receive, in preference to the
Common Stock, a liquidation payment of the greater of (i) $1.00 plus all accrued
and unpaid dividends and distributions and (ii) an amount equal to 400 times the
aggregate amount to be distributed per share of Common Stock. In the event of
any merger or other transaction in which Common Stock is to be exchanged, each
share of Series A Preferred Stock shall be entitled to receive 400 times the
amount received per share of Common Stock. The rights of holders of the Series A
Preferred Stock are subject to adjustment under certain circumstances to prevent
dilution. Series A Preferred Stock is not redeemable.
Shares of Common Stock and Series A Preferred Stock vote together as a
single class on all corporate matters (except for certain matters affecting the
Series A Preferred Stock or as otherwise required by law). Shares of Common
Stock are entitled to one vote per share. Voting for directors is not
cumulative. The board of directors is divided into three classes serving
staggered three-year terms.
Holders of Common Stock are entitled to dividends when, as, and if
declared by the board of directors out of funds legally available therefor
(subject to the rights of holders of any Preferred Stock). Common Stock is not
convertible into any other class of security, is not entitled to the benefit of
any sinking fund provision, and does not have any preemptive rights. All
outstanding shares of Common Stock are fully paid and nonassessable. Upon
liquidation of the Company, after payment or provision for all liabilities and
payment of any preferential amount in respect of Preferred Stock, holders of
Common Stock are entitled to receive liquidating distributions of any remaining
assets on a pro rata basis.
Article VI of the Company's articles of incorporation provides that
certain business combinations involving the Company and any shareholder which,
together with its affiliates, is the beneficial owner of 20 percent or more of
the Company's outstanding shares of capital stock, require the affirmative vote
of the holders of at least 80 percent of the outstanding shares of capital
stock. The 80 percent voting requirement does not apply (i) in the case of a
business combination which provides for conversion of Common Stock into cash,
securities or property having a fair market value not less than the highest
per-share price paid by such shareholder and its affiliates within one year
prior to the date of the vote, (ii) if the vote is required by the statutory
Business Combination provisions discussed below or (iii) under certain
circumstances, if the transaction is approved by the board of directors. The
articles of
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incorporation also provide that directors of the Company may be removed at a
meeting called expressly for that purpose by the affirmative vote of the holders
of not less than 80 percent of the outstanding shares of capital stock.
The Company has distributed to holders of Common Stock, rights to
purchase shares of Series A Preferred Stock ("Rights") which are held on the
basis of .25 Right for each share of Common Stock held. The Rights are not
exercisable and are attached to and trade with shares of Common Stock until the
earlier of (i) 10 days following a public announcement that a person or group
has acquired beneficial ownership (as defined) of 20 percent or more of the
outstanding Common Stock (other than the Company, any subsidiary of the Company,
any employee benefit plan of the Company or any subsidiary of the Company, any
entity holding shares of Common Stock for or pursuant to the terms of any such
plan, or a person who acquires shares in a tender offer sanctioned by the board
of directors) and (ii) 10 business days following the commencement or
announcement of certain offers to acquire beneficial ownership of 30 percent or
more of the outstanding Common Stock. Upon such an event, the Rights will trade
separately and will become exercisable. Until a Right is exercised, the holder
thereof will have no rights as a shareholder of the Company, including, without
limitation, the right to vote or to receive dividends.
When the Rights first become exercisable, one Right will entitle the
holder to buy from the Company one one-hundredth of a share of Series A
Preferred Stock at a price of $175. Upon acquisition of beneficial ownership of
20 percent or more of the outstanding Common Stock by a person or group
described above, each Right will entitle the holder (other than such person or
group) to buy from the Company for $175 shares of Common Stock having a market
value of $350. If the Company is acquired in a business combination, or a
majority of its assets is acquired, after a person or group described above
acquires beneficial ownership of 20 percent or more of the outstanding Common
Stock, each Right will thereafter entitle the holder (other than such person or
group) to acquire for $175 shares of common stock of the acquiring or surviving
person with a market value of $350. Following the occurrence of any of the
events described in the preceding two sentences, any Rights that are or (under
certain circumstances) were beneficially owned by any such person or group shall
immediately become null and void. The purchase price for Series A Preferred
Stock and the number of Series A Preferred Stock shares or other securities
issuable upon exercise of Rights are subject to adjustment to prevent dilution.
Outstanding Rights will expire at the close of business on February 25,
2000. The Rights will also expire upon consummation of a business combination
with a person who acquires shares of Common Stock in a tender offer sanctioned
by the board of directors if shareholders receive the same consideration as was
paid in the tender offer. Until the close of business on the tenth day following
public announcement that a person or group described above has acquired
beneficial ownership of 20 percent or more of the outstanding shares of Common
Stock, the Rights may be redeemed, in whole but not in part, at the Company's
election at a price of $.01 per right. After a person or group described above
acquires beneficial ownership of 20 percent or more of the outstanding Common
Stock, but before the person or group acquires beneficial ownership of 50
percent or more of the outstanding Common Stock, the Company may exchange some
or all of the then outstanding Rights for one share of Common Stock per Right,
subject to adjustment in certain circumstances.
Before the Rights become exercisable, the Company may amend the Rights
Agreement in any manner without the approval of the holders of Common Stock and
thereafter the Company may, subject to certain limitations, amend the Rights
Agreement without the approval of the holders of Rights.
The Company is subject to the Oregon Control Share Act (the "Control
Share Act"). The Control Share Act provides in essence that a person (an
"Acquiring Person") who acquires voting stock in a transaction which results in
its holding more than 20 percent, 33-1/3 percent or 50 percent of the total
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voting power of the Company (a "Control Share Acquisition") cannot vote the
shares it acquires in the Control Share Acquisition ("control shares") unless
voting rights are accorded to such control shares by the holders of a majority
of the outstanding voting shares, excluding the Acquiring Person and the
Company's officers and inside directors. The term Acquiring Person is broadly
defined to include persons acting as a group.
An Acquiring Person may, but is not required to, submit to the Company
an "Acquiring Person Statement" which delineates certain information about the
Acquiring Person and its plans for acquiring the Company's stock and requests
the Company to call a special meeting of shareholders to act on the question of
its voting rights. If an Acquiring Person does not request a special meeting of
shareholders, the matter shall be considered at the next annual or special
meeting of shareholders otherwise held. If an Acquiring Person's control shares
are accorded voting rights and its shares represent a majority or more of all
voting power, shareholders who do not vote in favor of the restoration of voting
rights will have the right to receive the appraised "fair value" for their
shares, which may not be less than the highest price paid per share by the
Acquiring Person for its shares in the Control Share Acquisition.
The Company is also subject to provisions of the Oregon Business
Corporation Act (the "Business Combination Provisions) which restrict the
ability of an Oregon corporation to engage in any business combination with an
interested shareholder ("Interested Shareholder"), as defined, for three years
after the shareholder becomes an Interested Shareholder, with certain
exceptions. An Interested Shareholder is defined to include a shareholder owning
15 percent or more of a corporation's stock. "Business combination" is defined
to include any merger with, any transfer of assets to and certain transactions
involving the issuance of shares to, the Interested Shareholder. A corporation
may, however, engage in a business combination with an Interested Shareholder if
(i) the corporation's board of directors approved the combination or the
transaction by which the shareholder became an Interested Shareholder before the
shareholder became an Interested Shareholder, (ii) the Interested Shareholder
acquired at least 85 percent of the voting stock (excluding shares held by
directors, officers, or certain employee share plans) when becoming an
Interested Shareholder, or (iii) the board of directors and shareholders holding
66- 2/3 percent of the voting stock not owned by the Interested Shareholder
approve the business combination. A corporation's articles of incorporation may
not require a greater vote of shareholders than that specified in the Business
Combination Provisions for any vote required by the Business Combination
Provisions.
PRICE RANGE OF THE COMPANY'S COMMON STOCK AND COMMON STOCK DIVIDENDS
The Company's Common Stock began trading on the NYSE on December 31,
1996. Before that date, the Common Stock traded on the NASDAQ National Market
System. The high and low closing sales prices of the Common Stock of the
Company, as reported in such markets, and the dividends declared on the Common
Stock, have been as follows (adjusted for a stock split):
<TABLE>
<CAPTION>
Per Share
-----------------------------------------------------------------
HIGH LOW CASH DIVIDENDS PAID
1995--
<S> <C> <C> <C>
First Quarter............................. $27.50 $23.38 $.14
Second Quarter............................ 28.13 24.13 .14
Third Quarter............................. 36.19 27.75 .15
Fourth Quarter............................ 33.25 27.13 .15
- 17 -
<PAGE>
Per Share
-----------------------------------------------------------------
HIGH LOW CASH DIVIDENDS PAID
1996--
First Quarter............................. 30.13 24.63 .16
Second Quarter............................ 32.13 28.75 .16
Third Quarter............................. 34.00 28.25 .16
Fourth Quarter............................ 35.25 31.25 .16
1997--
First Quarter............................. 34.81 30.44 .16
Second Quarter............................ 38.44 30.06 .16
Third Quarter through
September 30, 1997....................... 42.38 35.25 .16
</TABLE>
The closing price of Common Stock on September 30, 1997, was $38.25 per
share. The book value of the Company's Common Stock on December 31, 1996, was
$17.85 per share.
The timing and amount of future cash dividends will depend on the
earnings, capital requirements, and financial condition of the Company, and
other factors deemed relevant by the Company's Board of Directors.
DESCRIPTION OF THE WILLAMETTE TRUST PREFERRED SECURITIES
Each Willamette Trust may issue, from time to time, only one series of
Trust Preferred Securities having terms described in the Prospectus Supplement
relating thereto. The Declaration of each Willamette Trust authorizes the
Administrative Trustees of such Willamette Trust to execute and deliver
certificates on behalf of such Willamette Trust for one series of Trust
Preferred Securities. The Declaration will be qualified as an indenture under
the Trust Indenture Act. An independent trustee (the "Institutional Trustee" or
"Property Trustee") will act as indenture trustee for the Trust Preferred
Securities, to be issued by each Willamette Trust, for the purposes of
compliance with the provisions of the Trust Indenture Act. The Trust Preferred
Securities will have such terms, including distributions, redemption, voting,
liquidation rights and such other preferred, deferred or other special rights or
such restrictions as shall be set forth in the Declaration or made part of the
Declaration by the Trust Indenture Act, and which will mirror the terms of the
Subordinated Debt Securities held by the Willamette Trust and as described in
the Prospectus Supplement related thereto. The Prospectus Supplement relating to
any series of Trust Preferred Securities will describe the specific terms
thereof, including (i) the distinctive designation of such Trust Preferred
Securities; (ii) the number of Trust Preferred Securities issued by such
Willamette Trust; (iii) the annual distribution rate (or method of determining
such rate) for Trust Preferred Securities issued by such Willamette Trust and
the date or dates upon which such distributions shall be payable; provided,
however, that distributions on such Trust Preferred Securities shall be payable
on a periodic basis to holders of such Trust Preferred Securities as of a record
date in each period during which such Trust Preferred Securities are
outstanding; (iv) whether distributions on Trust Preferred Securities issued by
such Willamette Trust shall be cumulative, and, in the case of Trust Preferred
Securities having such cumulative distribution rights, the date or dates or
method of determining the date or dates from which distributions on Trust
Preferred Securities issued by such Willamette Trust shall be cumulative; (v)
the amount or amounts which shall be paid out of the assets of such Willamette
Trust to the holders of Trust Preferred Securities of such Willamette Trust upon
voluntary or involuntary
- 18 -
<PAGE>
dissolution, winding-up or termination of such Willamette Trust; (vi) the
obligation, if any, of such Willamette Trust to purchase or redeem Trust
Preferred Securities issued by such Willamette Trust and the price or prices at
which, the period or periods within which, and the terms and conditions upon
which, Trust Preferred Securities issued by such Willamette Trust shall be
purchased or redeemed, in whole or in part, pursuant to such obligation (with
such redemption price to be determined through negotiations among the Company
and the Underwriters based on, among other factors, redemption prices of
securities similar to the Trust Preferred Securities and market conditions
generally); (vii) the voting rights, if any, of Trust Preferred Securities
issued by such Willamette Trust in addition to those required by law, including
the number of votes per Preferred Security and any requirement for the approval
by the holders of Trust Preferred Securities, or of Trust Preferred Securities
issued by one or more Willamette Trusts, or of both, as a condition to specified
action or amendments to the Declaration of such Willamette Trust; (viii) the
terms and conditions, if any, upon which the Subordinated Debt Securities held
by such Willamette Trust may be distributed to holders of Trust Preferred
Securities; (ix) if applicable, any securities exchange upon which the Trust
Preferred Securities shall be listed; and (x) any other relevant rights,
preferences, privileges, limitations or restrictions of Trust Preferred
Securities issued by such Willamette Trust not inconsistent with the Declaration
of such Willamette Trust or with applicable law. All Trust Preferred Securities
offered hereby will be guaranteed by the Company to the extent set forth below
under "Description of the Trust Securities Guarantees." The Trust Preferred
Guarantee of the Company, when taken together with the Company's obligations
under the Subordinated Debt Securities and the relevant Supplemental Indenture,
and its obligations under each Declaration, including obligations to pay costs,
expenses, debts and liabilities of the Willamette Trust (other than with respect
to the Trust Securities), would provide a full and unconditional guarantee of
amounts due on Trust Preferred Securities issued by each Willamette Trust.
Certain United States federal income tax considerations applicable to any
offering of Trust Preferred Securities will be described in the Prospectus
Supplement relating thereto.
In connection with the issuance of Trust Preferred Securities, each
Willamette Trust will issue one series of Common Securities. The Declaration of
each Willamette Trust authorizes the Administrative Trustees of such trust to
execute and deliver certificates on behalf of such Willamette Trust for one
series of Common Securities having such terms including distributions,
redemption, voting, liquidation rights or such restrictions as shall be set
forth therein. The terms of the Common Securities issued by a Willamette Trust
will be substantially identical to the terms of the Trust Preferred Securities
issued by such trust and the Common Securities will rank pari passu, and
payments will be made thereon pro rata, with the Trust Preferred Securities
except that, upon an event of default under the Declaration which results from
an Event of Default under the Indenture, the rights of the holders of the Common
Securities to payment in respect of distributions and payments upon liquidation,
redemption and otherwise will be subordinated to the rights of the holders of
the Trust Preferred Securities. Except in certain limited circumstances, the
Common Securities will also carry the right to vote to appoint, remove or
replace any of the Willamette Trustees of a Willamette Trust. All of the Common
Securities of each Willamette Trust will be directly or indirectly owned by the
Company.
If an event of default under the Declaration of a Willamette Trust
occurs and is continuing, then the holders of Trust Preferred Securities of such
Willamette Trust would rely on the enforcement by the Institutional Trustee of
its rights as a holder of the applicable series of Subordinated Debt Securities
against the Company. In addition, the holders of a majority in liquidation
amount of the Trust Preferred Securities of such a Willamette Trust will have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Institutional Trustee or to direct the exercise of
any trust or power conferred upon the Institutional Trustee under the applicable
Declaration, including the right to direct the Institutional Trustee to exercise
the remedies available to it as a holder of the Subordinated Debt Securities. If
the Institutional Trustee fails to enforce certain of its rights under the
- 19 -
<PAGE>
applicable series of Subordinated Debt Securities, or the holders of not less
than 25% in principal amount of outstanding Subordinated Debt Securities fail to
exercise certain of their rights, the holders of at least 25% in liquidation
amount of the outstanding Trust Preferred Securities of such Willamette Trust
may assert such rights directly. Notwithstanding the foregoing, if an Event of
Default under the Indenture has occurred and is continuing and such event is
attributable to the failure of the Company to pay interest or principal on the
applicable series of Subordinated Debt Securities on the date such interest or
principal is otherwise payable (or in the case of redemption, on the redemption
date), then a holder of Trust Preferred Securities of such Willamette Trust may
directly institute a proceeding for enforcement of payment to such holder of the
principal of or interest on the applicable series of Subordinated Debt
Securities having a principal amount equal to the aggregate liquidation amount
of the Trust Preferred Securities of such holder (a "Direct Action") on or after
the respective due date specified in the applicable series of Subordinated Debt
Securities. In connection with such Direct Action, the Company will be
subrogated to the rights of such holder of Trust Preferred Securities under the
applicable Declaration to the extent of any payment made by the Company to such
holder of Trust Preferred Securities in such Direct Action.
DESCRIPTION OF THE TRUST SECURITIES GUARANTEES
Each Trust Securities Guarantee will be qualified as an indenture under
the Trust Indenture Act. An independent trustee will act as indenture trustee
under each Trust Securities Guarantee (the "Guarantee Trustee") for the purposes
of compliance with the provisions of the Trust Indenture Act. The following
summary does not purport to be complete and is subject in all respects to the
provisions of, and is qualified in its entirety by reference to, the form of
Trust Securities Guarantee, which is filed as an exhibit to the Registration
Statement of which this Prospectus forms a part, and the Trust Indenture Act.
Each Trust Securities Guarantee will be held by the Guarantee Trustee for the
benefit of the holders of the Trust Securities of the applicable Willamette
Trust.
Pursuant to each Trust Securities Guarantee, the Company will
irrevocably and unconditionally agree, to the extent set forth therein, to pay
in full, to the holders of the Trust Securities issued by a Willamette Trust,
the Guarantee Payments (as defined herein) (except to the extent paid by such
Willamette Trust), as and when due, regardless of any defense, right of set-off
or counterclaim which such Willamette Trust may have or assert. The following
payments or distributions with respect to Trust Securities issued by a
Willamette Trust to the extent not paid by such Willamette Trust (the "Guarantee
Payments"), will be subject to the Trust Securities Guarantee thereon (without
duplication): (i) any accrued and unpaid distributions which are required to be
paid on such Trust Securities, to the extent such Willamette Trust shall have
funds available therefore; (ii) the redemption price and all accrued and unpaid
distributions to the date of redemption (the "Redemption Price") to the extent
such Willamette Trust has funds available therefore with respect to any Trust
Securities called for redemption by such Willamette Trust and (iii) upon a
voluntary or involuntary liquidation, winding-up or termination of such
Willamette Trust (other than in connection with the distribution of Subordinated
Debt Securities to the holders of Trust Securities or the redemption of all of
the Trust Securities), the lesser of (a) the aggregate of the liquidation amount
and all accrued and unpaid distributions on such Trust Securities to the date of
payment, to the extent such Willamette Trust has funds available therefore and
(b) the amount of assets of such Willamette Trust remaining available for
distribution to holders of such Trust Securities in liquidation of such
Willamette Trust after satisfaction of liabilities to creditors of the Issuer as
required by applicable law. The Company's obligation to make a Guarantee Payment
may be satisfied by direct payment of the required amounts by the Company to the
holders of Trust Securities or by causing the applicable Willamette Trust to pay
such amounts to such holders.
- 20 -
<PAGE>
Each Trust Securities Guarantee will be a guarantee with respect to the
Trust Securities issued by the applicable Willamette Trust, but will not apply
to any payment of distributions except to the extent such Willamette Trust shall
have funds available therefore. If the Company does not make interest payments
on the Subordinated Debt Securities purchased by a Willamette Trust, such
Willamette Trust will not pay distributions on the Trust Securities issued by
such Willamette Trust and will not have funds available therefore. The Trust
Securities Guarantee, when taken together with the Company's obligations under
the Subordinated Debt Securities, the Subordinated Debt Securities Indenture,
and the Declaration will provide a full and unconditional guarantee on a
subordinated basis by the Company of payments due on the Trust Securities.
The Company has also agreed in the Trust Securities Guarantee
irrevocably and unconditionally to guarantee the obligations of the Willamette
Trusts with respect to the Common Securities to the same extent as the Trust
Preferred Securities, with the understanding that, pursuant to the Declaration,
upon an event of default under the Subordinated Debt Securities Indenture,
holders of Trust Preferred Securities shall have priority over holders of Common
Securities with respect to distributions and payments on liquidation and
redemption.
CERTAIN COVENANTS OF THE COMPANY
In each Trust Securities Guarantee, the Company will covenant that, so
long as any Trust Securities issued by the applicable Willamette Trust remain
outstanding, if there shall have occurred any event that would constitute an
event of default under such Trust Securities Guarantee or the Declaration of
such Willamette Trust, then (a) the Company shall not declare or pay any
dividend on, make any distributions with respect to, or redeem, purchase,
acquire or make liquidation payment with respect to, any of its capital stock
(other than (i) purchases or acquisitions of shares of Common Stock in
connection with the satisfaction by the Company of its obligations under any
employee benefit plans or the satisfaction by the Company of its obligations
pursuant to any contract or security outstanding on the date of such event
requiring the Company to purchase shares of Common Stock, (ii) as a result of a
reclassification of the Company's capital stock or the exchange or conversion of
one class or series of the Company's capital stock for another class or series
of the Company's capital stock or, (iii) the purchase of fractional interests in
shares of the Company's capital stock pursuant to the conversion or exchange
provisions of the Company's capital stock or the security being converted or
exchanged), (b) the Company shall not make any payment of interest, principal or
premium, if any, on or repay, repurchase or redeem any debt securities
(including guarantees) issued by the Company which rank pari passu with or
junior to such Subordinated Debt Securities and (c) the Company shall not make
any guarantee payments with respect to the foregoing (other than pursuant to a
Trust Securities Guarantee).
MODIFICATION OF THE TRUST SECURITIES GUARANTEES; ASSIGNMENT
Except with respect to any changes which do not adversely affect the
rights of holders of Trust Preferred Securities or the Guarantee Trustee in any
material respect (in which case no vote will be required), each Trust Securities
Guarantee may be amended only with the prior approval of the holders of not less
than a majority in liquidation amount of the outstanding Trust Preferred
Securities issued by the applicable Willamette Trust and, where the Guarantee
Trustee is adversely affected, the prior approval of the Guarantee Trustee. The
manner of obtaining any such approval of holders of such Trust Preferred
Securities will be as set forth in the Declaration and an accompanying
Prospectus Supplement. All guarantees and agreements contained in a Trust
Securities Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Company and shall inure to the benefit of the holders of
the Trust Securities of the applicable Willamette Trust then outstanding.
- 21 -
<PAGE>
TERMINATION
Each Trust Securities Guarantee will terminate as to the Trust
Securities issued by the applicable Willamette Trust (a) upon full payment of
the Redemption Price of all Trust Preferred Securities and Common Securities of
such Willamette Trust, (b) upon distribution of the Subordinated Debt Securities
held by such Willamette Trust to the holders of the Trust Preferred Securities
and Common Securities of such Willamette Trust or (c) upon full payment of the
amounts payable in accordance with the Declaration of such Willamette Trust upon
liquidation of such Willamette Trust. Each Trust Securities Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time any holder of Trust Preferred Securities or Common Securities issued by the
applicable Willamette Trust must restore payment of any sums paid under such
Trust Preferred Securities or such Trust Preferred Securities Guarantee.
EVENTS OF DEFAULT
An event of default under a Trust Securities Guarantee will occur upon
the failure of the Company to perform any of its payment or other obligations
thereunder; provided, however, that, except with respect to a default in any
payment obligations, the Company shall have received notice of default and shall
not have cured such default within 90 days after receipt of such notice.
The holders of a majority in liquidation amount of the Trust Preferred
Securities to which such Trust Securities Guarantee relates have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Guarantee Trustee in respect of the Trust Securities Guarantee
or to direct the exercise of any trust or power conferred upon the Guarantee
Trustee under such Trust Securities Guarantee. Any holder of Trust Securities to
which such Trust Securities Guarantee relates may institute a legal proceeding
directly against the Company to enforce such holder's rights under such Trust
Securities Guarantee, without first instituting a legal proceeding against the
relevant Willamette Trust, the Guarantee Trustee or any other person or entity.
Notwithstanding the foregoing, if the Company has failed to make a guarantee
payment, a holder of Trust Preferred Securities may directly institute a
proceeding against the Company for enforcement of the Trust Securities Guarantee
for such payment. The Company waives any right or remedy to require that any
action be brought first against such Willamette Trust or any other person or
entity before proceeding directly against the Company.
STATUS OF THE TRUST SECURITIES GUARANTEES
The Trust Securities Guarantees will constitute unsecured obligations
of the Company and will rank (i) subordinate and junior in right of payment to
all other Senior Debt of the Company (as defined in the Indenture), except those
debts made pari passu or subordinate to such obligations expressly by their
terms, and (ii) pari passu with any guarantee now or hereafter entered into by
the Company in respect of any preferred securities issued by another Willamette
Trust. The terms of the Trust Preferred Securities will provide that each holder
of Trust Preferred Securities issued by the applicable Willamette Trust by
acceptance thereof agrees to the subordination provisions and other terms of the
Trust Securities Guarantee relating thereto.
The Trust Securities Guarantees will constitute a guarantee of payment
and not of collection (that is, the guaranteed party may institute a legal
proceeding directly against the guarantor to enforce its rights under the
guarantee without instituting a legal proceeding against any other person or
entity).
- 22 -
<PAGE>
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, prior to the occurrence of an event of default
with respect to a Trust Securities Guarantee and after the curing of all events
of default that may have occurred, undertakes to perform only such duties as are
specifically set forth in such Trust Securities Guarantee and, after an event of
default has occurred that has not been cured or waived, shall exercise such of
the rights and powers vested in it by the Trust Securities Guarantee, and use
the same degree of care and skill as a prudent individual would exercise under
the circumstances in the conduct of his or her own affairs. Subject to such
provisions, the Guarantee Trustee is under no obligation to exercise any of the
powers vested in it by a Trust Securities Guarantee at the request of any holder
of Trust Preferred Securities, unless offered reasonable security and indemnity
against the costs, expenses and liabilities which might be incurred thereby; but
the foregoing shall not relieve the Guarantee Trustee, upon the occurrence of an
event of default under such Trust Securities Guarantee, from its obligation to
exercise the rights and powers vested in it by such Trust Preferred Securities
Guarantee.
EFFECT OF OBLIGATIONS UNDER THE SUBORDINATED
DEBT SECURITIES AND THE GUARANTEE
As set forth in the Declaration, the sole purpose of each of the
Willamette Trusts is to issue and sell the Trust Securities evidencing undivided
beneficial interests in the assets of each of the Willamette Trusts, to invest
the proceeds from such issuance and sale in the Subordinated Debt Securities,
and to engage in those activities necessary or incidental thereto.
As long as payments of interest and other payments are made when due on
the Subordinated Debt Securities, such payments will be sufficient to cover
distributions and payments due on the Trust Securities because: (i) the
aggregate principal amount of Subordinated Debt Securities will be equal to the
sum of the aggregate stated liquidation amount of the Trust Securities; (ii) the
interest rate and the interest and other payment dates on the Subordinated Debt
Securities will match the distribution rate and distribution and other payment
dates for the Trust Preferred Securities; (iii) the Company shall pay, and the
applicable Willamette Trust shall not be obligated to pay, directly or
indirectly, all costs, expenses, debt, and obligations of the applicable
Willamette Trust (other than with respect to the Trust Securities); and (iv) the
Declaration provides that the Willamette Trustees shall not take or cause or
permit the applicable Willamette Trust to engage in any activity that is not
consistent with the purposes of the applicable Willamette Trust.
Payments of distributions (to the extent funds therefore are available)
and other payments due on the Trust Preferred Securities (to the extent funds
therefore are available) are guaranteed by the Company as and to the extent set
forth under "Description of the Trust Securities Guarantees." If the Company did
not make interest payments on the Subordinated Debt Securities purchased by the
applicable Willamette Trust, it is expected that the applicable Willamette Trust
would not have sufficient funds to pay distributions on the Trust Preferred
Securities. The Guarantee does not apply to any payment of distributions unless
and until the applicable Willamette Trust has sufficient funds for the payment
of such distributions. The Guarantee covers the payment of distributions and
other payments on the Trust Preferred Securities only if and to the extent that
the Company has made a payment of interest or principal on the Subordinated Debt
Securities held by the applicable Willamette Trust as its sole asset. The
Guarantee, when taken together with the Company's obligations under the
Subordinated Debt Securities and the Indenture and its obligations under the
Declaration, including its obligations to pay costs, expenses, debts and
liabilities of the applicable Willamette Trust (other than with respect to the
Trust Securities), provide a full and unconditional guarantee of amounts on the
Trust Preferred Securities.
- 23 -
<PAGE>
DESCRIPTION OF STOCK PURCHASE CONTRACTS,
WARRANTS, AND STOCK PURCHASE UNITS
The Company may issue Stock Purchase Contracts, representing contracts
obligating holders to purchase from the Company, and the Company to sell to the
holders, a specified number of shares of Common Stock or Preferred Stock at a
future date or dates or representing warrants entitling a holder at its option
to purchase a specified number of shares of Common Stock or Preferred Stock for
the Company. The Company may also issue warrants to purchase shares of Common
Stock or Preferred Stock. The price per share of Common Stock or Preferred Stock
may be fixed at the time the warrants or other Stock Purchase Contracts are
issued or may be determined by reference to a specific formula set forth in the
Stock Purchase Contracts. The Stock Purchase Contracts may be issued separately
or as a part of units ("Stock Purchase Units") consisting of a Stock Purchase
Contract and Debt Securities or Trust Preferred Securities or debt obligations
of third parties, including U.S. Treasury securities, securing the holders'
obligations to purchase the Common Stock or Preferred Stock under the Purchase
Contracts. The Stock Purchase Contracts may require the Company to make periodic
payments to the holders of the Stock Purchase Units or visa versa, and such
payments may be unsecured or prefunded on some basis. The Stock Purchase
Contracts may require holders to secure their obligations thereunder in a
specified manner.
The applicable Prospectus Supplement will describe the terms of any
Stock Purchase Contracts or Stock Purchase Units, including, without limitation,
the number of shares to be purchased, the price per share or method of computing
such price, the date or dates of purchase, the terms and conditions of purchase,
the amount of any periodic payments required to be made by the holders thereof
or by the Company, and any required security for a purchase thereunder.
PLAN OF DISTRIBUTION
The Company and/or any Willamette Trust may sell the Offered Securities
(i) to or through underwriters or dealers; (ii) directly to purchasers; or (iii)
through agents. The Prospectus Supplement with respect to the Offered Securities
will set forth the terms of the offering of the Offered Securities, including
the name or names of any underwriters, dealers or agents; the purchase price of
the Offered Securities and the proceeds to the Company and/or a Willamette Trust
from such sale; any underwriting discounts and commissions or agency fees and
other items constituting underwriters' or agents' compensation; any initial
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers and any securities exchange on which such Offered Securities may
be listed. Any initial public offering price, discounts or concessions allowed
or reallowed or paid to dealers may be changed from time to time.
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The Offered Securities may be offered to the public either through underwriting
syndicates represented by one or more managing underwriters or directly by one
or more firms acting as underwriters. The underwriter or underwriters with
respect to a particular underwritten offering of Offered Securities will be
named in the Prospectus Supplement relating to such offering and, if an
underwriting syndicate is used, the managing underwriter or underwriters will be
set forth on the cover of such Prospectus Supplement. Unless otherwise set forth
in the Prospectus Supplement relating thereto, the obligations of the
underwriters to purchase the Offered Securities will be subject to certain
conditions precedent, and the underwriters will be obligated to purchase all the
Offered Securities if any are purchased.
- 24 -
<PAGE>
If dealers are utilized in the sale of Offered Securities, the Company
and/or the applicable Willamette Trust will sell such Offered Securities to the
dealers as principals. The dealers may then resell such Offered Securities to
the public at varying prices to be determined by such dealers at the time of
resale. The names of the dealers and the terms of the transaction will be set
forth in the Prospectus Supplement relating thereto.
The Offered Securities may be sold directly by the Company and/or a
Willamette Trust or through agents designated by the Company and/or such
Willamette Trust from time to time. Any agent involved in the offer or sale of
the Offered Securities in respect to which this Prospectus is delivered will be
named, and any commissions payable by the Company and/or the applicable
Willamette Trust to such agent will be set forth, in the Prospectus Supplement
relating thereto. Unless otherwise indicated in the Prospectus Supplement, any
such agent will be acting on a best efforts basis for the period of its
appointment.
The Offered Securities may be sold directly by the Company and/or a
Willamette Trust to institutional investors or others, who may be deemed to be
underwriters within the meaning of the Securities Act with respect to any resale
thereof. The terms of any such sales will be described in the Prospectus
Supplement relating thereto.
Agents, dealers and underwriters may be entitled under agreements with
the Company and/or a Willamette Trust to indemnification by the Company and/or
the applicable Willamette Trust against certain civil liabilities, including
liabilities under the Securities Act, or to contribution with respect to
payments which such agents, dealers or underwriters may be required to make in
respect thereof. Agents, dealers and underwriters may be customers of, engage in
transactions with, or perform services for the Company and/or a Willamette Trust
in the ordinary course of business.
Each series of Offered Securities other than Common Stock will be a new
issue of securities and will have no established trading market. Any
underwriters to whom Offered Securities are sold for public offering and sale
may make a market in such Offered Securities, but such underwriters will not be
obligated to do so and may discontinue any market making at any time without
notice.The Offered Securities may or may not be listed on a national securities
exchange. No assurance can be given that there will be a market for the Offered
Securities.
VALIDITY OF OFFERED SECURITIES
The validity of the Offered Securities will be passed upon for the
Company by Miller, Nash, Wiener, Hager & Carlsen LLP, Portland, Oregon.
EXPERTS
The consolidated financial statements of the Company included in the
Company's annual report on Form 10-K for the year ended December 31, 1996, have
been audited by KPMG Peat Marwick LLP, independent auditors, as set forth in
their report included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report and upon the authority of such firm as experts in
accounting and auditing.
- 25 -
<PAGE>
$500,000,000
WILLAMETTE INDUSTRIES, INC.
Senior Debt Securities
-----------------
Willamette Industries, Inc. (the "Company") may offer, from time to
time, unsecured senior debt securities ("Debt Securities") consisting of
debentures, notes or other unsecured evidences of indebtedness, in one or more
series and in amounts, at prices and on terms to be determined at or prior to
the time of sale.
Specific terms of the particular Debt Securities in respect of which
this Prospectus is delivered (the "Offered Securities") will be set forth in an
accompanying Prospectus Supplement or Supplements, together with the terms of
the offering of the Offered Securities, the initial price thereof and the
estimated net proceeds from the sale thereof. The Prospectus Supplement will set
forth with regard to the particular Offered Securities, without limitation, the
designation, aggregate principal amount, denomination, maturity, premium, if
any, exchange, conversion, redemption or sinking fund provisions, if any,
interest rate (which may be fixed or variable), the time and method of
calculating interest payments, put options, if any, public offering price, and
other specific terms of the offering.
The Company may sell the Offered Securities directly, through agents
designated from time to time or through underwriters or dealers. See "Plan of
Distribution." If any agents, underwriters, or dealers are involved in the sale
of the Offered Securities, the names of such agents, underwriters, or dealers
and any applicable commissions and discounts will be set forth in the related
Prospectus Supplement.
This Prospectus may not be used to consummate sales of Offered
Securities unless accompanied by a Prospectus Supplement.
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is October ---, 1997.
- 1 -
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, ANY ACCOMPANYING
PROSPECTUS SUPPLEMENT OR THE DOCUMENTS INCORPORATED OR DEEMED INCORPORATED BY
REFERENCE HEREIN, AND ANY INFORMATION OR REPRESENTATIONS NOT CONTAINED HEREIN OR
THEREIN MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE
WILLAMETTE TRUSTS OR BY ANY AGENT, DEALER OR UNDERWRITER. THIS PROSPECTUS AND
ANY ACCOMPANYING PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY CIRCUMSTANCES IN WHICH
SUCH OFFER OR SOLICITATION IS UNLAWFUL. THE DELIVERY OF THIS PROSPECTUS OR ANY
PROSPECTUS SUPPLEMENT AT ANY TIME DOES NOT IMPLY THAT THE INFORMATION HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act") and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "SEC"). Reports, proxy statements and
other information concerning the Company can be inspected and copied at the
SEC's Public Reference Room, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, DC 20549, as well as the Regional Offices of the SEC at 7 World
Trade Center, Suite 1300, New York, New York 10048 and Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511.
Copies of such material can be obtained from the Public Reference Section of the
SEC at Judiciary Plaza, 450 Fifth Street, N.W., Washington, DC 20549, at
prescribed rates. The SEC also maintains a Web site that contains reports, proxy
and information statements and other information regarding registrants that file
electronically with the SEC. The address of such site is http://www.sec.gov.
Such reports, proxy statements and other information may also be inspected at
the offices of the NYSE, on which Common Stock is traded, at 20 Broad Street,
New York, New York 10005.
This Prospectus constitutes a part of a Registration Statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") filed by the Company and the Willamette Trusts with the SEC under
the Securities Act of 1933, as amended (the "Securities Act") with respect to
the Offered Securities. This Prospectus does not contain all of the information
set forth in such Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the SEC. Reference is made to such
Registration Statement and to the exhibits relating thereto for further
information with respect to the Company and the Offered Securities. Any
statements contained herein concerning the provisions of any document filed as
an exhibit to the Registration Statement or otherwise filed with the SEC or
incorporated by reference herein are not necessarily complete, and in each
instance reference is made to the copy of such document so filed for a more
complete description of the matter involved. Each such statement is qualified in
its entirety by such reference.
The Company will send to all registered holders of the Offered
Securities such annual and other reports as are sent to its shareholders in
conformity with the requirements of the 1934 Act.
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<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the SEC pursuant to
the 1934 Act are incorporated by reference herein and made a part hereof:
1. Annual Report on Form 10-K for the year ended December 31,
1996.
2. The Company's quarterly reports on Form 10-Q for the quarters
ended March 31, 1997, and June 30, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the 1934 Act subsequent to the date hereof and prior to the
termination of the offering of the Offered Securities pursuant hereto shall be
deemed to be incorporated by reference in this Prospectus or in any Prospectus
Supplement and to be a part hereof from the date of filing of such documents.
Any statement contained herein or in a document incorporated or deemed
to be incorporated by reference in this Prospectus or in any Prospectus
Supplement shall be deemed to be modified or superseded for purposes of this
Prospectus or any Prospectus Supplement to the extent that a statement contained
in this Prospectus or in any Prospectus Supplement or in any other subsequently
filed document which also is or is deemed to be incorporated by reference in
this Prospectus or in any Prospectus Supplement modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus or any
Prospectus Supplement.
The Company undertakes to provide without charge to each person to whom
a copy of this Prospectus has been delivered, upon the written or oral request
of any such person, a copy of any or all of the foregoing documents incorporated
herein by reference, other than exhibits to such documents (unless such exhibits
are specifically incorporated by reference into such documents). Such requests
should be directed to: Willamette Industries, Inc., 1300 S.W. Fifth Avenue,
Suite 3800, Portland, Oregon 97201, Telephone: (503) 227-5581, Attention:
Investor Relations.
THE COMPANY
The Company is a diversified, integrated forest products company which
manufactures unbleached paper products, white paper products, and wood-based
building materials at 97 locations located throughout the United States and in
Ireland. The Company owns or controls approximately 1.8 million acres of
timberland in Arkansas, Louisiana, Missouri, North Carolina, Oregon, South
Carolina, Tennessee, Texas, and Washington.
The Company was incorporated in Oregon in 1906. Its executive offices
are located at 1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201, and
its telephone number is (503) 227-5581.
USE OF PROCEEDS
Unless otherwise indicated in a Prospectus Supplement with respect to
the proceeds from the sale of the particular Offered Securities to which such
Prospectus Supplement relates, the Company intends to add the net proceeds
received by it from the sale of Offered Securities to its general funds, to be
used for general corporate purposes, including capital expenditures, working
capital, and repayment of debt.
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<PAGE>
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's ratio of earnings to fixed
charges for the periods indicated.
<TABLE>
<CAPTION>
Six Months
Ended June 30, Year Ended December 31,
------------------ --------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 1996 1996 1995 1994 1993 1992
Ratio of Earnings to Fixed
Charges (1)(2)................. 1.59 5.46 3.68 10.83 4.25 3.06 2.56
</TABLE>
(1) The Company has authority to issue up to 5,000,000 shares of Preferred
Stock; there are currently no shares outstanding and the Company
currently does not have a Preferred Stock dividend obligation.
Therefore, the Ratio of Combined Earnings to Fixed Charges and
Preferred Stock Dividends is equal to the Ratio of Earnings to Fixed
Charges and is not disclosed separately.
(2) For purposes of computing the ratio, "earnings" consist of income
before income taxes, plus fixed charges. "Fixed charges" consist of
interest expense plus one-third of rent expense (which is deemed
representative of an interest factor).
DESCRIPTION OF THE DEBT SECURITIES
The particular terms of the Debt Securities offered by any Prospectus
Supplement and the extent, if any, to which such general provisions may apply to
the Debt Securities so offered will be described in the Prospectus Supplement
relating to such Debt Securities.
Debt Securities may be issued, from time to time, in one or more
series. Debt Securities will be issued under an Indenture dated January 30, 1993
(the "Indenture"), between the Company and The Chase Manhattan Bank, as trustee
(the "Trustee").
The following summary of certain provisions of the Debt Securities and
the Indenture do not purport to be complete and are subject to, and are
qualified in their entirety by express reference to, all the provisions of the
Indenture, including the definitions therein of certain terms. Certain
capitalized terms herein are defined in the Indenture.
GENERAL
The Debt Securities will be unsecured obligations of the Company. The
Indenture does not limit the aggregate principal amount of Debt Securities which
may be issued thereunder and provides that Debt Securities may be issued
thereunder, from time to time, in one or more series.
The Prospectus Supplement relating to the Offered Securities will
specify, among other things: (1) the title of the Offered Securities; (2) any
limit on the aggregate principal amount of the Offered Securities; (3) the date
or dates on which the Offered Securities will mature; (4) the rate or rates
(which may be fixed or variable) per annum at which the Offered Securities will
bear interest or the method by which such rate or rates shall be determined and
the date from which such interest will accrue or the method by which such date
shall be determined; (5) the dates on which any such interest will be payable
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<PAGE>
and the Regular Record Dates for such Interest Payment Dates; (6) the dates, if
any, on which, and the price or prices at which, the Offered Securities may,
pursuant to any mandatory or optional sinking fund provisions, be redeemed by
the Company and other detailed terms and provisions of such sinking funds; (7)
the date, if any, after which, and the price or prices at which, the Offered
Securities may, pursuant to any optional redemption provisions, be redeemed at
the option of the Company or of the Holder thereof and other detailed terms and
provisions of such optional redemption; (8) the right of the Company, if any, to
defer payment of interest on the Offered Securities and the maximum length of
any such deferral period; (9) the right of Holders, if any, to put the Offered
Securities to the Company; (10) the currency unit, if other than United States
dollars, of payment of principal, and premium and interest, if any, on the
Offered Securities; (11) the applicability of certain provisions of the
Indentures as described under "Defeasance and Covenant Defeasance"; and (12) any
other terms of the Offered Securities (which terms shall not be inconsistent
with the Indenture).
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the principal of, and any premium or interest, if any, on, the Offered
Securities will be payable, and the Offered Securities will be exchangeable and
transfers thereof will be registrable, at the Place of Payment, provided that,
at the option of the Company, payment of interest may be made by check mailed to
the address of the person entitled thereto as it appears in the Security
Register.
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the Offered Securities will be issued in United States dollars in fully
registered form, without coupons, in denominations of $1,000 or any integral
multiple thereof. No service charge will be made for any transfer or exchange of
the Offered Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
CERTAIN COVENANTS OF THE COMPANY
For purposes of the descriptions of the Debt Securities, certain
defined terms have the following meanings:
"Subsidiary" of the Company is defined as a corporation more than 50%
of the outstanding voting stock of which is owned, directly or indirectly, by
the Company and/or one or more Subsidiaries of the Company. "Restricted
Subsidiary" is defined as a Subsidiary of the Company substantially all the
property of which is located, or substantially all the business of which is
carried on, within the present 50 states of the United States or in Canada and
which owns a Principal Property, excluding, however, any Subsidiary of the
Company which is primarily engaged in the development and sale or financing of
real property. "Principal Property" is defined as (i) any mill, converting
plant, manufacturing plant, or other facility owned by the Company or a
Restricted Subsidiary which is located within the present 50 states of the
United States or in Canada and the gross book value of which (without deduction
of any depreciation reserves) on the date as of which the determination is made
exceeds 1% of Consolidated Net Tangible Assets, and (ii) Timberlands other than
those being held primarily for development or sale; such property, however, will
exclude (a) any property which in the opinion of the Board of Directors of the
Company is not of material importance to the total business conducted by the
Company and its Restricted Subsidiaries as an entirety or (b) any portion of a
particular property which is similarly found not to be of material importance to
the use or operation of such property or (c) any oil, gas or other minerals or
mineral rights. "Attributable Debt" is defined as the total net amount of rent
required to be paid during the remaining primary term of certain leases,
discounted at the rate of 15% per annum. "Consolidated Net Tangible Assets" is
defined as the aggregate amount of assets after deducting (i) all liabilities,
other than deferred income taxes, Funded Debt and shareholders' equity, and (ii)
goodwill and like intangibles, of the Company and its consolidated Subsidiaries.
"Funded Debt" is defined as all indebtedness for
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<PAGE>
money borrowed having a maturity of more than 12 months from the date as of
which the determination is made (or being renewable beyond such period) and
rental obligations (at the amount capitalized) payable more than 12 months from
such date under capitalized leases.
Restrictions on Secured Debt
The Indenture provides that the Company may not, nor may it permit any
Restricted Subsidiary to, create, assume or guarantee any loan or evidence of
indebtedness for money borrowed ("Debt") secured by a mortgage, pledge or lien
("Mortgage") on any Principal Property of the Company or any Restricted
Subsidiary, or on any share of Capital Stock or Debt of any Restricted
Subsidiary, without securing or causing such Restricted Subsidiary to secure the
Debt Securities equally and ratably with (or, at the Company's option, prior to)
such secured Debt, unless the aggregate amount of all such secured Debt,
together with all Attributable Debt with respect to sale and leaseback
transactions involving Principal Properties (with the exception of such
transactions which are excluded as described in "Restrictions on Sale of
Leaseback Transactions" below), would not exceed 10% of Consolidated Net
Tangible Assets.
This restriction does not apply to, and there shall be excluded from
secured Debt in any computation under such restriction, Debt secured by: (a)
Mortgages on property of, or on any shares of Capital Stock of or Debt of, any
corporation existing at the time such corporation becomes a Restricted
Subsidiary, (b) Mortgages in favor of the Company or a Restricted Subsidiary,
(c) Mortgages in favor of governmental bodies to secure progress or advance
payments, (d) Mortgages on property, shares of stock or Debt existing at the
time of acquisition thereof (including acquisition through merger or
consolidation) and purchase money and construction Mortgages which are entered
into within specified time limits, (e) Mortgages securing industrial revenue or
pollution control bonds, and (f) any extension, renewal or refunding of any
Mortgages referred to in the foregoing clauses (a) through (e), inclusive.
Restrictions on Sale and Leaseback Transactions
The Indenture provides that neither the Company nor any Restricted
Subsidiary may enter into any sale and leaseback transaction involving any
Principal Property, unless the aggregate amount of all Attributable Debt with
respect to such sale and leaseback transactions, plus all secured Debt (with the
exception of secured Debt which is excluded as described in "Restrictions on
Secured Debt" above), would not exceed 10% of Consolidated Net Tangible Assets.
This restriction does not apply to, and there shall be excluded from
Attributable Debt in any computation under such restriction, any sale and
leaseback transaction if (a) the lease is for a period, including renewal
rights, of not in excess of three years, (b) the sale or transfer of the
Principal Property is made within a specified period after its acquisition or
construction, (c) the lease secures or relates to industrial revenue or
pollution control bonds, (d) the transaction is between the Company and a
Restricted Subsidiary or between Restricted Subsidiaries or (e) the Company or
such Restricted Subsidiary, within 180 days after the sale is completed, applies
to the retirement of Funded Debt of the Company or a Restricted Subsidiary, or
the purchase of other property which will constitute Principal Property of a
value at least equal to the value of the Principal Property leased, an amount
not less than the greater of (i) the net proceeds of the sale of the Principal
Property leased or (ii) the fair market value of the Principal Property leased;
provided that the amount of proceeds to be applied to the retirement of Funded
Debt shall be reduced by an amount, if any, equal to the principal amount of
debentures or notes (including the Debt Securities) of the Company or a
Restricted Subsidiary surrendered for cancellation to the applicable trustee
thereof and the principal amount of other Funded Debt voluntarily retired, in
each case within 180 days after such sale.
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<PAGE>
Restrictions on Funded Debt of Restricted Subsidiaries
The Indenture provides that the Company may not permit any Restricted
Subsidiary to create, assume or guarantee any Funded Debt except (i) Funded Debt
owed to the Company or a Restricted Subsidiary, (ii) Funded Debt secured by
Mortgages permitted as described under "Restrictions on Secured Debt," (iii)
Funded Debt of any corporation outstanding at the time such corporation became a
Restricted Subsidiary, (iv) Funded Debt of any person outstanding at the time of
its acquisition, or the acquisition of substantially all its properties, by such
Restricted Subsidiary, (v) Funded Debt incurred in connection with certain
refundings, (vi) Funded Debt constituting Attributable Debt permitted as
described under "Restrictions on Sale and Leaseback Transactions" and (vii) any
other Funded Debt if the aggregate principal amount of all Funded Debt of all
Restricted Subsidiaries permitted under this clause (vii) does not exceed 10% of
Consolidated Net Tangible Assets.
EVENTS OF DEFAULT
The following are Events of Default under the Indenture with respect to
the Debt Securities of any series: (a) default in the payment of principal of or
any premium on any Debt Security of that series when due; (b) default in the
payment of any interest on any Debt Security of that series when due continued
for 30 days; (c) default in the deposit of any sinking fund payment, when due,
in respect of any Debt Security of that series; (d) default in the performance
of any other covenant of the Company in the Indenture (other than a covenant
included in the Indenture solely for the benefit of a series of the Debt
Securities other than that series), continued for 90 days after written notice
as provided in the Indenture; (e) certain events in bankruptcy, insolvency or
reorganization; and (f) any other Event of Default provided with respect to Debt
Securities of a particular series. No Event of Default with respect to the Debt
Securities of a particular series necessarily constitutes an Event of Default
with respect to the Debt Securities of any other series.
If an Event of Default with respect to the Debt Securities of any
series at the time Outstanding occurs and is continuing, either the Trustee or
the Holders of at least 25% in aggregate principal amount of the Outstanding
Debt Securities of that series may declare the principal amount (or, if the Debt
Securities of that series are original issue discount Debt Securities, such
portion of the principal amount as may be specified in the terms of that series)
of all the Debt Securities of that series to be due and payable immediately. At
any time after a declaration of acceleration with respect to the Debt Securities
of any series has been made, but before a judgment or decree based on
acceleration has been obtained, the Holders of a majority in principal amount of
the Outstanding Debt Securities of that series may, under certain circumstances,
rescind and annul such acceleration.
The Indenture provides that, subject to the duty of the Trustee during
the continuance of an Event of Default to act with the required standard of
care, the Trustee will be under no obligation to exercise any of its rights or
powers under the Indenture at the request or direction of any of the Holders,
unless such Holders shall have offered to the Trustee reasonable indemnity.
Subject to such provisions for the indemnification of the Trustee, the Holders
of a majority in principal amount of the Outstanding Debt Securities of any
series will have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee, with respect to the Debt Securities of that
series. The right of a Holder of any Debt Security to institute a proceeding
with respect to the Indenture is subject to certain conditions precedent, but
each Holder has an absolute right to receive payment of principal or premium and
interest, if any, when due and to institute suit for the enforcement of any such
payment.
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<PAGE>
The Company is required to furnish to the Trustee annually a statement
as to the performance by the Company of its obligations under the Indenture and
as to any default in such performance.
The Debt Securities may be issued as Original Issue Discount Securities
to be offered and sold at a substantial discount below their principal amount.
Special federal income tax, accounting and other considerations applicable to
any such Original Issue Discount Securities will be described in any Prospectus
Supplement relating thereto. "Original Issue Discount Security" means any
security which provides for an amount less than the principal amount thereof to
be due and payable upon a declaration of acceleration of the maturity thereof as
a result of the occurrence of an Event of Default and the continuation thereof.
BOOK-ENTRY DEBT SECURITIES
The Debt Securities of a series may be issued in whole or in part in
the form of one or more Global Securities (as such term is defined below) that
will be deposited with, or on behalf of, a Depositary ("Depositary") or its
nominee identified in the applicable Prospectus Supplement. In such a case, one
or more Global Securities will be issued in a denomination or aggregate
denomination equal to the portion of the aggregate principal amount of
outstanding Debt Securities of the series to be represented by such Global
Security or Global Securities. Unless and until it is exchanged in whole or in
part for Debt Securities in registered form, a Global Security may not be
registered for transfer or exchange except as a whole by the Depositary for such
Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any nominee to a successor Depositary or a nominee of such
successor Depositary and except in the circumstances described in the applicable
Prospectus Supplement. The term "Global Security", when used with respect to any
series of Debt Securities, means a Debt Security that is executed by the Company
and authenticated and delivered by the Trustee to the Depositary or pursuant to
the Depositary's instruction, which shall be registered in the name of the
Depositary or its nominee and which shall represent, and shall be denominated in
an amount equal to the aggregate principal amount of, all of the Outstanding
Debt Securities of such series or any portion thereof, in either case having the
same terms, including, without limitation, the same original issue date, date or
dates on which principal is due, and interest rate or method of determining
interest.
The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Global Security
will be described in the applicable Prospectus Supplement. The Company expects
that the following provisions will apply to depositary arrangements. Unless
otherwise specified in the applicable Prospectus Supplement, Debt Securities
which are to be represented by a Global Security to be deposited with or on
behalf of a Depositary will be represented by a Global Security registered in
the name of such Depositary or its nominee. Upon the issuance of such Global
Security, and the deposit of such Global Security with or on behalf of the
Depositary for such Global Security, the Depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts of
the Debt Securities represented by such Global Security to the accounts of
institutions that have accounts with such Depositary or its nominee
("participants"). The accounts to be credited will be designated by the
underwriters or agents of such Debt Securities or, if such Debt Securities are
offered and sold directly by the Company, by the Company. Ownership of
beneficial interests in such Global Security will be limited to participants or
Persons that may hold interests through participants. Ownership of beneficial
interests by participants in such Global Security will be shown on, and the
transfer of that ownership interest will be effected only through, records
maintained by the Depositary or its nominee for such Global Security. Ownership
of beneficial interests in such Global Security by Persons that hold through
participants will be shown on, and the transfer of that ownership interest
within such participant will be effected only through, records maintained by
such participant.
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<PAGE>
The laws of some jurisdictions require that certain purchasers of securities
take physical delivery of such securities in certificated form. The foregoing
limitations and such laws may impair the ability to transfer beneficial
interests in such Global Securities.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or Holder of the Securities
represented by such Global Security for all purposes under the Indenture. Unless
otherwise specified in the applicable Prospectus Supplement, owners of
beneficial interests in such Global Security will not be entitled to have Debt
Securities of the series represented by such Global Security registered in their
names, will not receive or be entitled to receive physical delivery of Debt
Securities of such series in certificated form and will not be considered the
Holders thereof for any purposes under the Indenture. Accordingly, each Person
owning a beneficial interest in such Global Security must rely on the procedures
of the Depositary and, if such Person is not a participant, on the procedures of
the participant through which such Person owns its interest, to exercise any
rights of a Holder under the Indenture. The Company understands that under
existing industry practices, if the Company requests any action of Holders or an
owner of a beneficial interest in such Global Security desires to give any
notice or take any action a Holder is entitled to give or take under the
Indenture, the Depositary would authorize the participants to give such notice
or take such action, and participants would authorize beneficial owners owning
through such participants to give such notice or take such action or would
otherwise act upon the instructions of beneficial owners owning through them.
Principal of and any premium and interest on a Global Security will be
payable in the manner described in the applicable Prospectus Supplement.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of the Holders of any of the
Outstanding Debt Securities under the Indenture, may consolidate with or merge
into, or transfer its assets substantially as an entirety to, any corporation
organized under the laws of any domestic jurisdiction, and any other person may
consolidate with, or merge into, or transfer its assets substantially as an
entirety to the Company provided that (i) the successor corporation (if any)
assumes the Company's obligations on the Debt Securities and under the
Indenture, (ii) after giving effect to the transaction and treating any
indebtedness which becomes an obligation of the Company or a Subsidiary as a
result of such transaction as having been incurred by the Company or the
Subsidiary at the time of such transaction, no Event of Default, and no event
which, after notice or lapse of time, would become an Event of Default, shall
have occurred and be continuing, (iii) if as a result of the transaction a
Principal Property would become subject to a Mortgage which would not be
permitted by the Indenture, the Debt Securities shall be secured equally with
(or prior to) the indebtedness secured thereby, and (iv) certain other
conditions are met.
DEFEASANCE AND COVENANT DEFEASANCE
The Indenture provides, if such provision is made applicable to the
Debt Securities of any series (which will be indicated in the Prospectus
Supplement) that the Company may elect either (a) to defease and be discharged
from any and all obligations in respect of the Debt Securities of such series
(except for certain obligations to register the transfer or exchange of Debt
Securities of such series, to replace mutilated, destroyed, lost or stolen Debt
Securities of such series, to maintain paying agencies and to hold moneys for
payment in trust) ("defeasance") or (b) to be released from its obligations with
respect to the Debt Securities of such series under certain restrictive
covenants of the Indenture, including those described under "Certain Covenants
of the Company," and "Consolidation, Merger and Sale of Assets" ("covenant
defeasance") and the occurrence of an event described in clause (d) under
"Events of Default"
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<PAGE>
shall no longer be an Event of Default with respect to the Debt Securities of
such series, in each case, if the Company deposits, in trust, with the Trustee
money and/or Government Obligations, which through the payment of interest
thereon and principal thereof in accordance with their terms will provide money
in an amount sufficient, without reinvestment, to pay the principal of and any
premium and interest on the Outstanding Debt Securities of such series and any
mandatory sinking fund payments or analogous payments in accordance with the
terms of the Outstanding Debt Securities of such series and the Indenture. Such
a trust may only be established if, among other things, (i) no Event of Default
or event which with the giving of notice or lapse of time, or both, would become
an Event of Default with respect to such series under the Indenture shall have
occurred and be continuing on the date of such deposit, (ii) such deposit will
not cause the Trustee to have any conflicting interest with respect to other
securities of the Company and (iii) the Company shall have delivered an Opinion
of Counsel to the effect that the Holders will not recognize income, gain or
loss for federal income tax purposes as a result of such defeasance and will be
subject to federal income tax on the same amounts, in the same manner, and at
the same times as if such defeasance had not occurred. In the event the Company
exercises its covenant defeasance option with respect to the Debt Securities of
any series and the Debt Securities of such series are declared due and payable
because of the occurrence of any Event of Default, the amount of money and
Government Obligations on deposit with the Trustee will be sufficient to pay
amounts due on the Debt Securities of such series at the time of their Stated
Maturity but may not be sufficient to pay amounts due on the Debt Securities of
such series at the time of the acceleration resulting from such Event of
Default. However, the Company will remain liable with respect to such payments.
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the
Company and the Trustee with the consent of the Holders of a majority in
principal amount of the Outstanding Debt Securities of each series affected by
such modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Debt
Security affected thereby, (a) change the stated maturity date of the principal
of, or any installment of principal of or interest, if any, on, any Debt
Security, (b) reduce the principal amount of, or premium or rate of interest, if
any, on, any Debt Security, (c) reduce the amount of principal of an original
issue discount Debt Security payable upon acceleration of the maturity thereof,
(d) change the place or currency of payment of principal of, or premium or
interest, if any, on, any Debt Security, (e) impair the right to institute suit
for the enforcement of any payment on or with respect to any Debt Security, (f)
change the provisions for defeasance or covenant defeasance (each as defined
below) made applicable to any Debt Security, or (g) reduce the percentage in
principal amount of Outstanding Debt Securities of any series, the consent of
whose Holders is required for modification or amendment of the Indenture or for
waiver of compliance with certain provisions of the Indenture or for waiver of
certain defaults.
The Holders of a majority in principal amount of the Outstanding Debt
Securities of each series may, on behalf of all Holders of the Debt Securities
of that series, waive, insofar as that series is concerned, compliance by the
Company with certain restrictive provisions of the Indenture. The Holders of a
majority in aggregate principal amount of the Outstanding Debt Securities of
each series may, on behalf of all Holders of the Debt Securities of that series,
waive any past default under the Indenture with respect to the Debt Securities
of that series, except a default in the payment of principal, or premium or
interest, if any, or in respect of a covenant or condition which cannot be
waived without the consent of each Holder of the Debt Securities of that series.
- 10 -
<PAGE>
REGARDING THE TRUSTEE
The Company maintains deposit accounts and conducts other banking
transactions with The Chase Manhattan Bank in the ordinary course of the
Company's business. The Chase Manhattan Bank serves as trustee under another
indenture with respect to certain of the Company's other senior debt securities.
PLAN OF DISTRIBUTION
The Company may sell the Offered Securities (i) to or through
underwriters or dealers; (ii) directly to purchasers; or (iii) through agents.
The Prospectus Supplement with respect to the Offered Securities will set forth
the terms of the offering of the Offered Securities, including the name or names
of any underwriters, dealers or agents; the purchase price of the Offered
Securities and the proceeds to the Company from such sale; any underwriting
discounts and commissions or agency fees and other items constituting
underwriters' or agents' compensation; any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers and any
securities exchange on which such Offered Securities may be listed. Any initial
public offering price, discounts or concessions allowed or reallowed or paid to
dealers may be changed from time to time.
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The Offered Securities may be offered to the public either through underwriting
syndicates represented by one or more managing underwriters or directly by one
or more firms acting as underwriters. The underwriter or underwriters with
respect to a particular underwritten offering of Offered Securities will be
named in the Prospectus Supplement relating to such offering and, if an
underwriting syndicate is used, the managing underwriter or underwriters will be
set forth on the cover of such Prospectus Supplement. Unless otherwise set forth
in the Prospectus Supplement relating thereto, the obligations of the
underwriters to purchase the Offered Securities will be subject to certain
conditions precedent, and the underwriters will be obligated to purchase all the
Offered Securities if any are purchased.
If dealers are utilized in the sale of Offered Securities, the Company
will sell such Offered Securities to the dealers as principals. The dealers may
then resell such Offered Securities to the public at varying prices to be
determined by such dealers at the time of resale. The names of the dealers and
the terms of the transaction will be set forth in the Prospectus Supplement
relating thereto.
The Offered Securities may be sold directly by the Company or through
agents designated by the Company from time to time. Any agent involved in the
offer or sale of the Offered Securities in respect to which this Prospectus is
delivered will be named, and any commissions payable by the Company to such
agent will be set forth, in the Prospectus Supplement relating thereto. Unless
otherwise indicated in the Prospectus Supplement, any such agent will be acting
on a best efforts basis for the period of its appointment.
The Offered Securities may be sold directly by the Company to
institutional investors or others, who may be deemed to be underwriters within
the meaning of the Securities Act with respect to any resale thereof. The terms
of any such sales will be described in the Prospectus Supplement relating
thereto.
Agents, dealers and underwriters may be entitled under agreements with
the Company to indemnification by the Company against certain civil liabilities,
including liabilities under the Securities Act, or to contribution with respect
to payments which such agents, dealers or underwriters may be
- 11 -
<PAGE>
required to make in respect thereof. Agents, dealers and underwriters may be
customers of, engage in transactions with, or perform services for the Company
in the ordinary course of business.
Each series of Offered Securities will be a new issue of securities and
will have no established trading market. Any underwriters to whom Offered
Securities are sold for public offering and sale may make a market in such
Offered Securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice.The Offered Securities
may or may not be listed on a national securities exchange. No assurance can be
given that there will be a market for the Offered Securities.
VALIDITY OF OFFERED SECURITIES
The validity of the Offered Securities will be passed upon for the
Company by Miller, Nash, Wiener, Hager & Carlsen LLP, Portland, Oregon.
EXPERTS
The consolidated financial statements of the Company included in the
Company's annual report on Form 10-K for the year ended December 31, 1996, have
been audited by KPMG Peat Marwick LLP, independent auditors, as set forth in
their report included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report and upon the authority of such firm as experts in
accounting and auditing.
- 12 -
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this amendment to
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Portland, State of Oregon, on the 2nd day of
October, 1997.
WILLAMETTE INDUSTRIES, INC.
By Steven R. Rogel*
President and Chief Executive Officer
WILLAMETTE CAPITAL TRUST I
By /s/ G. W. HAWLEY
G. W. HAWLEY
WILLAMETTE CAPITAL TRUST II
By /s/ G. W. HAWLEY
G. W. HAWLEY
Pursuant to the requirements of the Securities Act of 1933, this
amendment to registration statement has been signed below by the following
persons in the capacities indicated on the 2nd day of October, 1997.
SIGNATURE TITLE
(1) Principal Executive Officer President and Chief Executive
and Director of Willamette Officer and Director
Industries, Inc.:
Steven R. Rogel*
II - 1
<PAGE>
SIGNATURE TITLE
(2) Principal Financial Officer Executive Vice President and
of Willamette Industries, Inc.: Chief Financial Officer,
Secretary, and Treasurer
/s/ J. A. PARSONS
J. A. PARSONS
(3) Principal Accounting Officer Vice President-Controller
of Willamette Industries, Inc.:
/s/ G. W. HAWLEY
G. W. HAWLEY
(4) A majority of the Board of Directors
of Willamette Industries, Inc.:
Director
Gerard K. Drummond*
Director
Kenneth W. Hergenhan*
Director
C. W. Knodell*
Director
Paul N. McCracken*
Director
G. Joseph Prendergast*
Director
Stuart J. Shelk, Jr.*
Director
Robert M. Smelick*
Director
William Swindells*
Director
Samuel C. Wheeler*
Director
Benjamin R. Whiteley*
II - 2
<PAGE>
SIGNATURE TITLE
(5) A majority of the Trustees of
Willamette Capital Trust I:
/s/ G. W. HAWLEY
G. W. HAWLEY
/s/ DONALD C. ATKINSON
DONALD C. ATKINSON
(6) A majority of the Trustees of
Willamette Capital Trust II:
/s/ G. W. HAWLEY
G. W. HAWLEY
/s/ DONALD C. ATKINSON
DONALD C. ATKINSON
*By /s/ J. A. PARSONS
J. A. PARSONS
ATTORNEY-IN-FACT
II - 3
<PAGE>
INDEX TO EXHIBITS
EXHIBIT DOCUMENT DESCRIPTION
--------------------
NUMBER
- ------
1.1 Form of Underwriting Agreement**
1.2 Form of Agency Distribution Agreement**
3.1 Third Restated Articles of Incorporation of the Company, as amended.
Incorporated by reference from Exhibit 3A of the registrant's quarterly
report on Form 10-Q for the quarter ended March 31, 1996.
3.2 Bylaws of the Company, as amended. Incorporated by reference from
Exhibit 3.2 of the registrants' quarterly report on Form 10-Q for the
quarter ended June 30, 1996.
3.3 Preferred Stock Purchase Rights of Willamette Industries, Inc.
Incorporated by reference from Exhibit 2 of the registrants' Form 8-A
filed February 26, 1990.
3.4 Certificate of Trust of Willamette Capital I (previously filed)
3.5 Declaration of Trust of Willamette Capital I (previously filed)
3.6 Certificate of Trust of Willamette Capital II (previously filed)
3.7 Declaration of Trust of Willamette Capital II (previously filed)
3.8 Amended and Restated Declaration of Trust and Trust Agreement of
Willamette Capital I*
3.9 Amended and Restated Declaration of Trust of Willamette Capital II*
4.1 Indenture, dated as of January 30, 1993, between the Company and The
Chase Manhattan Bank. Incorporated by reference to Exhibit 4A to the
Company's registration statement on Form S-3 (File No. 33-58044)
effective March 1, 1993.
4.2 Form of Subordinated Indenture*
4.3 Form of Debt Securities**
4.4 Form of Warrants**
4.5 Form of Warrant Agreement**
4.6 Form of Stock Purchase Contract**
4.7 Form of Pledge Agreement**
4.8 Form of Stock Purchase Unit**
4.9 Form of Stock Purchase Contract Agreement**
4.10 Specimen Certificate of Common Stock of the Company (previously filed)
4.11 Form of Preferred Security Certificate for Willamette Capital I**
4.12 Form of Trust Securities Guarantee in respect of Willamette Capital I*
4.13 Form of Preferred Security Certificate for Willamette Capital II**
II - 4
<PAGE>
EXHIBIT DOCUMENT DESCRIPTION
--------------------
NUMBER
- ------
4.14 Form of Trust Securities Guarantee in respect of Willamette Capital II*
5.1 Opinion of Miller, Nash, Wiener, Hager & Carlsen LLP as to the validity
of the Securities (previously filed)
5.2 Opinion of Delaware special counsel as to the validity of the Trust
Preferred Securities**
12 Computation of ratio of earnings to fixed charges. Incorporated by
reference to Exhibit 12 to the registrants' quarterly report on Form
10-Q for the quarter ended June 30, 1997.
23.1 Consent of KPMG Peat Marwick LLP, independent auditors (previously
filed)
23.2 Consent of Miller, Nash, Wiener, Hager & Carlsen LLP (included in
Exhibit 5.1)
23.3 Consent of Delaware special counsel (to be included in Exhibit 5.2)
24 Powers of attorney (previously filed)
25.1 Form T-1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of The Chase Manhattan Bank**
25.2 Form T-1 Statement of Eligibility of the Trustee under the Subordinated
Indenture, the Property Trustee under the Amended and Restated
Declaration of Trust of Willamette Capital I and Willamette Capital II,
and the Guarantee Trustee under the Guarantees for Willamette Capital I
and Willamette Capital II**
- ----------------------------
* The form filed herewith may be supplemented or amended by a supplement
filed as an exhibit to a report filed under Section 13 of the
Securities Exchange Act of 1934
** To be filed by amendment or as an exhibit to a subsequently filed
report filed under Section 13 of the Securities Exchange Act of 1934
and incorporated herein by reference
II - 5
================================================================================
AMENDED AND RESTATED
DECLARATION OF TRUST AND
TRUST AGREEMENT
among
WILLAMETTE INDUSTRIES, INC., as Depositor,
[-----------------------------------------------,]
as Property Trustee,
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee,
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
Dated as of ------------------, 1997
WILLAMETTE CAPITAL I
================================================================================
<PAGE>
WILLAMETTE CAPITAL II
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Act Section Trust Agreement Section
310 (a)(1)..............................................................8.7
(a)(2)..............................................................8.7
(a)(3)..............................................................8.9
(a)(4)................................................... 2.7(a)(ii)(E)
(b).................................................................8.8
311 (a)..................................................... Not Applicable
(b)......................................................Not Applicable
312 (a)......................................................Not Applicable
(b)......................................................Not Applicable
(c).................................................................5.7
313 (a).........................................................8.14(a),(b)
(a)(4)......................................................... 8.14(b)
(b)......................................................Not Applicable
(c)................................................................10.8
(d).............................................................8.14(c)
314 (a)................................................................8.15
(b)..................................................... Not Applicable
(c)(1).............................................................8.16
(c)(2).............................................................8.16
(c)(3)...................................................Not Applicable
(d)......................................................Not Applicable
(e)...........................................................1.1, 8.16
315 (a)..................................................... 8.1(a), 8.3(a)
(b)...........................................................8.2, 10.8
(c)..............................................................8.1(a)
(d)............................................................8.1, 8.3
(e)......................................................Not Applicable
316 (a)(1)(A)............................................... Not Applicable
(a)(1)(B)..........................................................5.13
(a)(2)...................................................Not Applicable
(b)................................................................5.14
(c).................................................................6.7
317 (a)(1)...................................................Not Applicable
(a)(2).............................................................8.13
Note: This reconciliation and tie sheet shall not, for any purpose, be deemed
to be a part of the Trust Agreement.
- i -
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
ARTICLE I. DEFINED TERMS........................................................................ 2
SECTION 1.1 Definitions................................................................. 2
ARTICLE II. CONTINUATION OF THE TRUST............................................................ 10
SECTION 2.1 Name........................................................................ 10
SECTION 2.2 Office of the Delaware Trustee; Principal Place of
Business.................................................................... 10
SECTION 2.3 Initial Contribution of Trust Property; Organizational
Expenses.................................................................... 11
SECTION 2.4 Issuance of the Preferred Securities........................................ 11
SECTION 2.5 Issuance of the Common Securities; Subscription and
Purchase of Subordinated Debt Securities.................................... 11
SECTION 2.6 Declaration of Trust........................................................ 12
SECTION 2.7 Authorization to Enter into Certain Transactions............................ 12
SECTION 2.8 Assets of Trust............................................................. 16
SECTION 2.9 Title to Trust Property..................................................... 16
ARTICLE III. PAYMENT ACCOUNT............................................................................... 16
SECTION 3.1 Payment Account............................................................. 16
ARTICLE IV. DISTRIBUTIONS; REDEMPTION..................................................................... 17
SECTION 4.1 Distributions............................................................... 17
SECTION 4.2 Redemption.................................................................. 18
SECTION 4.3 [Repayment at Option of Holders............................................. 20
SECTION 4.4 Subordination of Common Securities.......................................... 21
SECTION 4.5 Payment Procedures.......................................................... 22
SECTION 4.6 Tax Returns and Reports..................................................... 22
SECTION 4.7 Payment of Taxes, Duties, Etc. of the Trust................................. 23
SECTION 4.8 Payments under Indenture or Pursuant to Direct Actions...................... 23
ARTICLE V. TRUST SECURITIES CERTIFICATES................................................................. 23
SECTION 5.1 Initial Ownership........................................................... 23
SECTION 5.2 The Trust Securities Certificates........................................... 23
SECTION 5.3 Execution and Delivery of Trust Securities Certificates..................... 24
SECTION 5.4 Registration of Transfer and Exchange of Preferred
Securities Certificates..................................................... 24
SECTION 5.5 Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates................................................................ 25
SECTION 5.6 Persons Deemed Holders...................................................... 25
SECTION 5.7 Access to List of Holders' Names and Addresses.............................. 25
SECTION 5.8 Maintenance of Office or Agency............................................. 25
SECTION 5.9 Appointment of Paying Agent................................................. 26
SECTION 5.10 Ownership of Common Securities by Depositor................................. 26
- i -
<PAGE>
SECTION 5.11 Book-Entry Preferred Securities Certificates; Common
Securities Certificate...................................................... 27
SECTION 5.12 Notices to Clearing Agency.................................................. 28
SECTION 5.13 Definitive Preferred Securities Certificates................................ 28
SECTION 5.14 Rights of Holders........................................................... 28
ARTICLE VI. ACTS OF SECURITYHOLDERS; MEETINGS; VOTING..................................................... 31
SECTION 6.1 Limitations on Voting Rights................................................ 31
SECTION 6.2 Notice of Meetings.......................................................... 32
SECTION 6.3 Meetings of Holders of Preferred Securities................................. 32
SECTION 6.4 Voting Rights............................................................... 32
SECTION 6.5 Proxies, etc................................................................ 32
SECTION 6.6 Holder Action by Written Consent............................................ 33
SECTION 6.7 Record Date for Voting and Other Purposes................................... 33
SECTION 6.8 Acts of Holders............................................................. 33
SECTION 6.9 Inspection of Records....................................................... 34
ARTICLE VII. REPRESENTATIONS AND WARRANTIES....................................................... 35
SECTION 7.1 Representations and Warranties of the Property Trustee
and the Delaware Trustee............................................................. 35
SECTION 7.2 Representations and Warranties of Depositor................................. 36
ARTICLE VIII. THE TRUSTEES......................................................................... 36
SECTION 8.1 Certain Duties and Responsibilities......................................... 36
SECTION 8.2 Certain Notices............................................................. 38
SECTION 8.3 Certain Rights of Property Trustee.......................................... 38
SECTION 8.4 Not Responsible for Recitals or Issuance of Securities............................... 40
SECTION 8.5 May Hold Securities......................................................... 40
SECTION 8.6 Compensation; Indemnity; Fees........................................................ 41
SECTION 8.7 Corporate Property Trustee Required; Eligibility of
Trustees.................................................................... 42
SECTION 8.8 Conflicting Interests................................................................ 42
SECTION 8.9 Co-Trustees and Separate Trustee............................................ 43
SECTION 8.10 Resignation and Removal; Appointment of Successor........................... 44
SECTION 8.11 Acceptance of Appointment by Successor...................................... 45
SECTION 8.12 Merger, Conversion, Consolidation or Succession to
Business.................................................................... 46
SECTION 8.13 Preferential Collection of Claims Against Depositor or
Trust....................................................................... 46
SECTION 8.14 Reports by Property Trustee................................................. 47
SECTION 8.15 Reports to the Property Trustee............................................. 48
SECTION 8.16 Evidence of Compliance with Conditions Precedent............................ 48
SECTION 8.17 Number of Trustees.......................................................... 48
SECTION 8.18. Delegation of Power......................................................... 49
- ii -
<PAGE>
ARTICLE IX. TERMINATION, LIQUIDATION AND MERGER........................................................... 49
SECTION 9.1 Perpetual Existence......................................................... 49
SECTION 9.2 Early Termination........................................................... 49
SECTION 9.3 Termination................................................................. 50
SECTION 9.4 Liquidation................................................................. 50
SECTION 9.5 Mergers, Consolidations, Amalgamations or
Replacements of the Trust................................................... 51
ARTICLE X. MISCELLANEOUS PROVISIONS...................................................................... 52
SECTION 10.1 Limitation of Rights of Holders............................................. 52
SECTION 10.2 Amendment................................................................... 53
SECTION 10.3 Separability................................................................ 54
SECTION 10.4 Governing Law............................................................... 54
SECTION 10.5 Payments Due on Non-Business Day............................................ 54
SECTION 10.6 Successors.................................................................. 54
SECTION 10.7 Headings.................................................................... 55
SECTION 10.8 Reports, Notices and Demands................................................ 55
SECTION 10.9 Agreement Not to Petition................................................... 55
SECTION 10.10 Trust Indenture Act; Conflict with Trust Indenture Act...................... 56
SECTION 10.11 Acceptance of Terms of Trust Agreement, Guarantee and
Indenture................................................................... 56
SECTION 10.12 Expenses.................................................................... 57
EXHIBIT B FORM OF LETTER TO DEPOSITORY TRUST COMPANY........................................... 59
EXHIBIT C....................................................................................................... 60
</TABLE>
- iii -
<PAGE>
AMENDED AND RESTATED DECLARATION OF TRUST AND TRUST AGREEMENT,
dated as of ------------------, 1997, among (i) Willamette Industries, Inc., an
Oregon corporation (including any successors or assigns, the "Depositor"), (ii)
[--------------------------], a national banking corporation duly organized and
existing under the laws of [-------------], as property trustee, (in each such
capacity, the "Property Trustee" and, in its separate corporate capacity and not
in its capacity as Property Trustee, the"Bank"), (iii) Chase Manhattan Bank
Delaware, a banking corporation duly organized and existing under the laws of
the State of Delaware, as Delaware trustee (the"Delaware Trustee"), (iv) G. W.
Hawley, an individual, and Donald C. Atkinson, an individual, each of whose
address is c/o Willamette Industries, Inc., 1300 S.W. Fifth Avenue, Suite 3800,
Portland, Oregon 97201 (each an "Administrative Trustee" and collectively the
"Administrative Trustees") (the Property Trustee, the Delaware Trustee and the
Administrative Trustees referred to collectively as the"Trustees") and (v) the
several Holders, as hereinafter defined.
WITNESSETH
WHEREAS, the Depositor, the Delaware Trustee, and the
Administrative Trustees have previously duly declared and established a business
trust pursuant to the Delaware Business Trust Act, by entering into a
Declaration of Trust dated as of July 30, 1997 (the "Original Trust Agreement"),
and by executing and filing with the Secretary of State of the State of Delaware
of the Certificate of Trust, filed on July 31, 1997, attached as Exhibit A; and
WHEREAS, the Depositor and the Trustees desire to duly declare
and establish a business trust pursuant to the Delaware Business Trust Act and
the Certificate of Trust by entering into this Trust Agreement to restate and
amend the Original Trust Agreement to provide for, among other things, (i) the
issuance of the Common Securities by the Trust to the Depositor, (ii) the
issuance and sale of the Preferred Securities by the Trust pursuant to the
Underwriting Agreement, (iii) the acquisition by the Trust from the Depositor of
all of the right, title and interest in the Subordinated Debt Securities and
(iv) the appointment of the Property Trustee and Administrative Trustees;
NOW THEREFORE, in consideration of the agreements and
obligations set forth herein and for other good and valuable consideration, the
sufficiency of which is hereby acknowledged, each party, for the benefit of the
other parties and for the benefit of the Holders, hereby amends and restates the
Original Trust Agreement in its entirety and agrees as follows:
- 1 -
<PAGE>
ARTICLE I.
DEFINED TERMS
SECTION 1.1 Definitions.
For all purposes of this Trust Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Trust Agreement; and
(d) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.8.
"Additional Amount" means, with respect to Trust Securities of
a given Liquidation Amount and/or a given period, the amount of Defaulted
Interest (as defined in the Indenture) paid by the Depositor on Subordinated
Debt Securities having an aggregate principal amount equal to such given
Liquidation Amount for such period.
"Administrative Trustee" means each of the Persons identified
as an "Administrative Trustee" in the preamble to this Trustee Agreement solely
in such Person's capacity as Administrative Trustee of the Trust formed and
continued hereunder and not in such Person's individual capacity, or such
Administrative Trustee's successor in interest in such capacity, or any
successor trustee appointed as herein provided.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" has the meaning specified in the preamble to this Trust
Agreement.
- 2 -
<PAGE>
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having
jurisdiction in the premises judging such Person a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization, arrangement,
adjudication or composition of or in respect of such Person under any applicable
Federal or State bankruptcy, insolvency, reorganization or other similar law, or
appointing a receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of such Person or of any substantial part of its property or
ordering the winding up or liquidation of its affairs, and the continuance of
any such decree or order unstayed and in effect for a period of 60 consecutive
days; or
(b) the institution by such Person of proceedings to be
adjudicated a bankrupt or insolvent, or the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it of a
petition or answer or consent seeking reorganization or relief under any
applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law, or the consent by it to the filing of any such petition or to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or
similar official) of such Person or of any substantial part of its property, or
the making by it of an assignment for the benefit of creditors, or the admission
by it in writing of its inability to pay its debts generally as they become due
and its willingness to be adjudicated a bankrupt, or the taking of corporate
action by such Person in furtherance of any such action.
"Bankruptcy Laws" has the meaning specified in Section 10.9.
"Book-Entry Preferred Securities Certificates" means a
beneficial interest in the Preferred Securities Certificates, ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 5.11.
"Business Day" means a day other than (a) a Saturday or
Sunday, (b) a day on which banking institutions in The City of New York are
authorized or required by law or executive order to remain closed, or (c) a day
on which the Property Trustee's Corporate Trust Office or the Corporate Trust
Office of the Indenture Trustee is closed for business.
"Certificate Depository Agreement" means the agreement among
the Trust, the Depositor and The Depository Trust Company, as the initial
Clearing Agency, dated as of the Closing Date, relating to the Trust Securities
Certificates, substantially in the form attached as Exhibit B, as the same may
be amended and supplemented from time to time.
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository Trust Company will be the initial Clearing
Agency.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
- 3 -
<PAGE>
"Closing Date" means the First Time of Delivery, which date is
also the date of execution and delivery of this Trust Agreement.
["Collateral Agent" shall mean -------------------, as
collateral agent under the Pledge Agreement, dated the date hereof, among the
Depositor, the collateral agent, -------------, as purchase contract agent and
the holders from time to time of the Depositor's ---% Automatic Convertible
Exchange Securities.]
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934, as amended, 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 Security" means an undivided beneficial interest in
the assets of the Trust, having a Liquidation Amount of $----------- and having
the rights provided therefor in this Trust Agreement, including the right to
receive Distributions and a Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as Exhibit C.
"Corporate Trust Office" means (i) when used with respect to
the Property Trustee, the principal office of the Property Trustee located in
[NEW YORK, NEW YORK], and (ii) when used with respect to the Indenture Trustee,
the principal office of the Indenture Trustee located in
[-----------------------].
"Creditor" has the meaning specified in Section 10.12.
"Definitive Preferred Securities Certificates" means either or
both (as the context requires) of (a) Preferred Securities Certificates issued
as Book-Entry Preferred Securities Certificates as provided in Section 5.11(a)
and (b) Preferred Securities Certificates issued in certificated, fully
registered form upon original issuance thereof or as provided in Section 5.13.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of
the Delaware Code, 12 Del. C. (Section) 3801, et seq., as it may be amended from
time to time.
"Delaware Trustee" means the Person identified as the
"Delaware Trustee" in the preamble to this Trust Agreement solely in its
capacity as Delaware Trustee of the Trust formed and continued hereunder and not
in its individual capacity, or its successor in interest in such capacity, or
any successor trustee appointed as herein provided.
"Depositor" has the meaning specified in the preamble to this
Trust Agreement.
- 4 -
<PAGE>
"Direct Action" has the meaning specified in Section 5.14.
"Distribution Date" has the meaning specified in Section
4.1(a).
"Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 4.1.
"Early Termination Event" has the meaning specified in Section
9.2.
"Event of Default" means any one of the following events
(whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of an Indenture Event of Default; or
(b) default by the Property Trustee in the payment of any
Distribution when it becomes due and payable, and continuation of such default
for a period of 30 days; or
(c) default by the Property Trustee in the payment of any
Redemption Price of any Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material
respect, of any covenant or warranty of the Trustees in this Trust Agreement
(other than a covenant or warranty a default in the performance or breach of
which is dealt with in clause (b) or (c) above) and continuation of such default
or breach for a period of 60 days after there has been given, by registered or
certified mail, to the defaulting Trustee or Trustees by the Holders of at least
25% in aggregate liquidation preference of the Outstanding Preferred Securities
a written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the
Property Trustee and the failure by the Depositor to appoint a successor
Property Trustee within 60 days thereof.
"Exchange Act" means the Securities Exchange Act of 1934, and
any successor statute thereto, in each case as amended from time to time.
"First Time of Delivery" has the meaning specified in the
Underwriting Agreement.
"Guarantee" means the Guarantee Agreement executed and
delivered by the Depositor and [--------------------------], as trustee,
contemporaneously with the
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execution and delivery of this Trust Agreement, for the benefit of the holders
of the Preferred Securities, as amended from time to time.
"Holder" or "Securityholder"means a Person in whose name a
Trust Security or Trust Securities is registered in the Securities Register; any
such Person shall be deemed to be a beneficial owner within the meaning of the
Delaware Business Trust Act.
"Indemnified Person" has the meaning specified in Section 8.6.
"Indenture" means the Indenture of Subordinated Debt
Securities, dated as of --------------, 1997, between the Depositor and the
Indenture Trustee, as trustee, as amended or supplemented from time to time.
"Indenture Event of Default" means an "Event of Default" as
defined in the Indenture.
"Indenture Redemption Date" means, with respect to any
Subordinated Debt Securities to be redeemed under the Indenture, the date fixed
for redemption under the Indenture.
"Indenture Trustee" means [---------------------------------],
a banking corporation duly organized under the laws of the State of
[---------------], and any successor thereto.
"Lien" means any lien, pledge, charge, encumbrance, mortgage,
deed of trust, adverse ownership interest, hypothecation, assignment, security
interest or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to that portion
of the principal amount of Subordinated Debt Securities to be contemporaneously
redeemed in accordance with the Indenture, allocated to the Common Securities
and to the Preferred Securities based upon the relative Liquidation Amounts of
such classes of Trust Securities and the proceeds of which will be used to pay
the Redemption Price of such Trust Securities, and (b) with respect to a
distribution of Subordinated Debt Securities to Holders of Trust Securities in
connection with a dissolution or liquidation of the Trust, Subordinated Debt
Securities having a principal amount equal to the Liquidation Amount of the
Trust Securities of the Holder to whom such Subordinated Debt Securities are
distributed.
"Liquidation Amount" means the stated amount of $--- per Trust
Security.
"Liquidation Date" means the date on which Subordinated Debt
Securities are to be distributed to Holders of Trust Securities in connection
with a termination and liquidation of the Trust pursuant to Section 9.4(a).
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"Liquidation Distribution" has the meaning specified in
Section 9.4(d).
"1940 Act" means the Investment Company Act of 1940, as
amended.
"Officers' Certificate" means a certificate signed by the
Chairman and Chief Executive Officer, President or a Vice President, and by the
Treasurer, an Associate Treasurer, an Assistant Treasurer, the Controller, the
Secretary or an Assistant Secretary, of the Depositor, and delivered to the
appropriate Trustee. One of the officers signing an Officers' Certificate given
pursuant to Section 8.16 shall be the principal executive, financial or
accounting officer of the Depositor. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this Trust
Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions relating
thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering the
Officers' Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is necessary to
enable such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who
may be counsel for the Trust, the Property Trustee or the Depositor, but not an
employee of any thereof, and who shall be reasonably acceptable to the Property
Trustee.
"Original Trust Agreement" has the meaning specified in the
recitals to this Trust Agreement.
"Outstanding", when used with respect to Trust Securities,
means, as of the date of determination, all Trust Securities theretofore
executed and delivered under this Trust Agreement, except:
(a) Trust Securities theretofore canceled by the Property
Trustee or delivered to the Property Trustee for cancellation;
(b) Trust Securities for whose payment or redemption money in
the necessary amount has been theretofore deposited with the Property Trustee or
any Paying Agent for the Holders of such Trust Securities; provided that, if
such Trust Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Trust Agreement; and
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(c) Trust Securities which have been paid or in exchange for
or in lieu of which other Preferred Securities have been executed and delivered
pursuant to Sections 5.4, 5.5, 5.11 and 5.13; provided, however, that in
determining whether the Holders of the requisite Liquidation Amount of the
Outstanding Preferred Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Preferred Securities owned by
the Depositor, any Trustee or any Affiliate of the Depositor or any Trustee
shall be disregarded and deemed not to be Outstanding, except that (a) in
determining whether any Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Preferred Securities that such Trustee knows to be so owned shall be so
disregarded and (b) the foregoing shall not apply at any time when all of the
outstanding Preferred Securities are owned by the Depositor, one or more of the
Trustees and/or any such Affiliate. Preferred Securities so owned which have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Administrative Trustees the pledgee's
right so to act with respect to such Preferred Securities and that the pledgee
is not the Depositor or any Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of a
Book-Entry Preferred Securities Certificate as reflected in the records of the
Clearing Agency or, if a Clearing Agency Participant is not the Owner, then as
reflected in the records of a Person maintaining an account with such Clearing
Agency (directly or indirectly, in accordance with the rules of such Clearing
Agency).
"Paying Agent" means any paying agent or co-paying agent
appointed pursuant to Section 5.9 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing
corporate trust account maintained by the Property Trustee with the Bank in its
trust department for the benefit of the Holders in which all amounts paid in
respect of the Subordinated Debt Securities will be held and from which the
Property Trustee, through the Paying Agent, shall make payments to the Holders
in accordance with Sections 4.1 and 4.2.
"Person" means any individual, corporation, partnership, joint
venture, trust, limited liability company or corporation, unincorporated
organization or government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial interest in
the assets of the Trust, having a Liquidation Amount of $__ and having the
rights provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Securities Certificate" means a certificate
evidencing ownership of Preferred Securities, substantially in the form attached
as Exhibit E.
"Property Trustee" means the Person identified as the
"Property Trustee" in the preamble to this Trust Agreement solely in its
capacity as Property Trustee of the Trust
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heretofore formed and continued hereunder and not in its individual capacity, or
its successor in interest in such capacity, or any successor property trustee
appointed as herein provided.
["Purchase Contract Settlement Date" means
- ------------------------, ----.]
["Put Option" shall have the meaning specified in Section
4.3.]
["Put Option Exercise Date" shall have the meaning specified
in Section 4.3.]
["Put Option Exercise Price" shall have the meaning specified
in Section 4.3.]
"Redemption Date" means, with respect to any Trust Security to
be redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided that each Subordinated Debt Security Redemption Date and the
stated maturity of the Subordinated Debt Securities shall be a Redemption Date
for a Like Amount of Trust Securities.
"Redemption Price" means, with respect to any Trust Security,
the Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, plus the related amount of the premium, if
any, paid by the Depositor upon the concurrent redemption of a Like Amount of
Subordinated Debt Securities, allocated on a pro rata basis (based on
Liquidation Amounts) among the Trust Securities.
"Relevant Trustee" shall have the meaning specified in Section
8.10.
"Second Time of Delivery" has the meaning specified in the
Underwriting Agreement.
"Securities Register" and "Securities Registrar" have the
respective meanings specified in Section 5.4.
"Subordinated Debt Securities" means the aggregate principal
amount of the Depositor's -----% [Notes/Subordinated Debt Securities], Series -,
issued pursuant to the Indenture.
"Time of Delivery" means, collectively, the First Time of
Delivery and the Second Time of Delivery.
"Trust" means the Delaware business trust created and
continued hereby and identified on the cover page to this Trust Agreement.
"Trust Agreement" means this Trust Agreement, as the same may
be modified, amended or supplemented in accordance with the applicable
provisions hereof, including (i) all exhibits hereto and (ii) for all purposes
of this Trust Agreement and any such
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modification, amendment or supplement, the provisions of the Trust Indenture Act
that are deemed to be a part of and govern this Trust Agreement and any such
modification, amendment or supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed; provided,
however, that in the event the Trust Indenture Act of 1939 is amended after such
date, "Trust Indenture Act" means, to the extent required by any such amendment,
the Trust Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Subordinated Debt Securities,
(b) the rights of the Property Trustee under the Guarantee, (c) any cash on
deposit in, or owing to, the Payment Account and (d) all proceeds and rights in
respect of the foregoing and any other property and assets for the time being
held or deemed to be held by the Property Trustee pursuant to the trusts of this
Trust Agreement.
"Trust Security" means any one of the Common Securities or the
Preferred Securities.
"Trust Securities Certificate" means any one of the Common
Securities Certificates or the Preferred Securities Certificates.
"Trustees" means, collectively, the Property Trustee, the
Delaware Trustee and the Administrative Trustees.
"Underwriting Agreement" means the Pricing Agreement, dated as
of ----------- --, 1997, among the Trust, the Depositor and the underwriters
named therein incorporating the Underwriting Agreement dated --------- --, 1997.
ARTICLE II.
CONTINUATION OF THE TRUST
SECTION 2.1 Name.
The Trust continued hereby shall be known as "Willamette
Capital I," as such name may be modified from time to time by the Administrative
Trustees following written notice to the Holders of Trust Securities and the
other Trustees, in which name the Trustees may conduct the business of the
Trust, make and execute contracts and other instruments on behalf of the Trust
and sue and be sued.
SECTION 2.2 Office of the Delaware Trustee; Principal Place of
Business.
The address of the Delaware Trustee in the State of Delaware
is 1201 North Market Street, Wilmington, Delaware 19801, or such other address
in the State of Delaware as the Delaware Trustee may designate by written notice
to the Holders and the Depositor.
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The principal executive office of the Trust is c/o Willamette Industries, Inc.,
1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201.
SECTION 2.3 Initial Contribution of Trust Property; Organizational
Expenses.
The Property Trustee acknowledges receipt in trust from the
Depositor in connection with the Original Trust Agreement of the sum of $10,
which constituted the initial Trust Property. The Depositor shall pay
organizational expenses of the Trust as they arise or shall, upon request of any
Trustee, promptly reimburse such Trustee for any such expenses paid by such
Trustee. The Depositor shall make no claim upon the Trust Property for the
payment of such expenses.
SECTION 2.4 Issuance of the Preferred Securities.
Pursuant to the Original Trust Agreement, on -----------,
199_, the Depositor on behalf of the Trust executed and delivered the
Underwriting Agreement and, contemporaneously with the execution and delivery
hereof, an Administrative Trustee, on behalf of the Trust, shall execute in
accordance with Section 5.2 and deliver to the Underwriters named in the
Underwriting Agreement Preferred Securities Certificates, registered in the name
of the nominee of the initial Clearing Agency, in an aggregate amount of
- ----------- Preferred Securities having an aggregate Liquidation Amount of
$-----------, against receipt of such aggregate purchase price of such Preferred
Securities of $-----------, which amount the Administrative Trustee shall
promptly deliver to the Property Trustee. If there is a Second Time of Delivery,
an Administrative Trustee, on behalf of the Trust, shall execute in accordance
with Section 5.2 and deliver to the Underwriters named in the Underwriting
Agreement Preferred Securities Certificates, registered in the name of the
nominee of the initial Clearing Agency, in an aggregate amount of up to
- ---------- Preferred Securities having an aggregate Liquidation Amount of up to
$-----------, against receipt of the aggregate purchase price of such Preferred
Securities equal to the Liquidation Amount thereof, which amount such
Administrative Trustee shall promptly deliver to the Property Trustee.
SECTION 2.5 Issuance of the Common Securities; Subscription and
Purchase of Subordinated Debt Securities.
Contemporaneously with the execution and delivery of this
Trust Agreement, an Administrative Trustee, on behalf of the Trust, shall
execute in accordance with Section 5.2 and deliver to the Depositor Common
Securities Certificates, registered in the name of the Depositor, in an
aggregate amount of _______ Common Securities having an aggregate Liquidation
Amount of $____________ against payment by the Depositor of such amount, which
amount such Administrative Trustee shall promptly deliver to the Property
Trustee. Contemporaneously therewith, an Administrative Trustee, on behalf of
the Trust, shall subscribe to and purchase from the Depositor Subordinated Debt
Securities, registered in the name of the Trust and having an aggregate
principal amount equal to $_________, and, in satisfaction of the purchase price
for such Subordinated Debt Securities, the Property
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Trustee, on behalf of the Trust, shall deliver to the Depositor the sum of
$--------- (being the sum of the amounts delivered to the Property Trustee
pursuant to (i) the first sentence of Section 2.4 and (ii) the first sentence of
this Section 2.5). If there is a Second Time of Delivery, an Administrative
Trustee, on behalf of the Trust, shall execute in accordance with Section 5.2
and deliver to the Depositor Common Securities Certificates, registered in the
name of the Depositor, in an aggregate amount of up to ------- Common Securities
having an aggregate Liquidation Amount of up to $---------- against payment by
the Depositor of such amount, which amount such Administrative Trustee shall
promptly deliver to the Property Trustee. Contemporaneously therewith, an
Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase
from the Depositor Subordinated Debt Securities, registered in the name of the
Trust and having an aggregate principal amount of up to $-----------, and, in
satisfaction of the purchase price for such Subordinated Debt Securities, the
Property Trustee, on behalf of the Trust, shall deliver to the Depositor the
amount received from one of the Administrative Trustees pursuant to the last
sentence of Section 2.4 (being the sum of the amounts delivered to the Property
Trustee pursuant to (i) the second sentence of Section 2.4 and (ii) the third
sentence of this Section 2.5).
SECTION 2.6 Declaration of Trust.
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 Debt Securities, and (b) to engage in those activities
necessary or incidental thereto. The Depositor hereby appoints the Trustees as
trustees of the Trust, to have all the rights, powers and duties to the extent
set forth herein, and the Trustees hereby accept such appointment. The Property
Trustee hereby declares that it will hold the Trust Property in trust upon and
subject to the conditions set forth herein for the benefit of the Trust and the
Securityholders. The Administrative Trustees shall have all rights, powers and
duties set forth herein and in accordance with applicable law with respect to
accomplishing the purposes of the Trust. The Delaware Trustee shall not be
entitled to exercise any powers, nor shall the Delaware Trustee have any of the
duties and responsibilities, of the Property Trustee or the Administrative
Trustees set forth herein. The Delaware Trustee shall be one of the Trustees of
the Trust for the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Delaware Business Trust Act.
SECTION 2.7 Authorization to Enter into Certain Transactions.
(a) The Trustees shall conduct the affairs of the Trust in
accordance with the terms of this Trust Agreement. Subject to the limitations
set forth in paragraph (b) of this Section, and in accordance with the following
provisions (i) and (ii), the Trustees shall have the authority to enter into all
transactions and agreements determined by the Trustees to be appropriate in
exercising the authority, express or implied, otherwise granted to the Trustees
under this Trust Agreement, and to perform all acts in furtherance thereof,
including without limitation, the following:
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(i) As among the Trustees, each Administrative Trustee shall
have the power and authority to act on behalf of the Trust with respect
to the following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust, the Certificate
Depository Agreement and such other agreements as may be
necessary or desirable in connection with the purposes and
function of the Trust;
(C) assisting in the registration of the Preferred
Securities under the Securities Act of 1933, as amended, and
under state securities or blue sky laws, and the qualification
of this Trust Agreement as a trust indenture under the Trust
Indenture Act;
(D) assisting in the listing of the Preferred
Securities upon such securities exchange or exchanges as shall
be determined by the Depositor and the registration of the
Preferred Securities under the Exchange Act, and the
preparation and filing of all periodic and other reports and
other documents pursuant to the foregoing;
(E) the sending of notices (other than notices of
default) and other information regarding the Trust Securities
and the Subordinated Debt Securities to the Holders in
accordance with this Trust Agreement;
(F) the appointment of a Paying Agent, authenticating
agent and Securities Registrar in accordance with this Trust
Agreement;
(G) execution of the Trust Securities in accordance
with this Trust Agreement and execution and delivery of
closing certificates pursuant to the Underwriting Agreement;
(H) registering transfer of the Trust Securities in
accordance with this Trust Agreement;
(I) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the Trust
and the preparation, execution and filing of the certificate
of cancellation with the Secretary of State of the State of
Delaware;
(J) unless otherwise determined by the Depositor, the
Property Trustee or the Administrative Trustees, or as
otherwise required by the Delaware Business Trust Act or the
Trust Indenture Act, to execute on behalf of the Trust (either
acting alone or together with any or all of the
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Administrative Trustees) any documents that the Administrative
Trustees have the power to execute pursuant to this Trust
Agreement; and
(K) the taking of any action incidental to the
foregoing as the Trustees may from time to time determine is
necessary or advisable to give effect to the terms of this
Trust Agreement for the benefit of the Holders (without
consideration of the effect of any such action on any
particular Holder).
(ii) As among the Trustees, the Property Trustee shall have
the power, duty and authority to act on behalf of the Trust with
respect to the following matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Subordinated Debt Securities;
(C) the collection of interest, principal and any
other payments made in respect of the Subordinated Debt
Securities in the Payment Account;
(D) the distribution through the Paying Agent of
amounts owed to the Holders in respect of the Trust
Securities;
(E) the exercise of all of the rights, powers and
privileges of a holder of the Subordinated Debt Securities;
(F) the sending of notices of default and other
information regarding the Trust Securities and the
Subordinated Debt Securities to the Holders in accordance with
this Trust Agreement;
(G) the distribution of the Trust Property in
accordance with the terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the Trust
and the preparation, execution and filing of the certificate
of cancellation with the Secretary of State of the State of
Delaware;
(I) after an Event of Default (other than under
paragraph (b), (c), (d) or (e) of the definition of such term
if such Event of Default is by or with respect to the Property
Trustee) the taking of any action incidental to the foregoing
as the Property Trustee may from time to time determine is
necessary or advisable to give effect to the terms of this
Trust Agreement and protect and conserve the Trust Property
for the benefit of the Holders (without consideration of the
effect of any such action on any particular Holder); and
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(J) except as otherwise provided in this Section
2.7(a)(ii), the Property Trustee shall have none of the
duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 2.7(a)(i).
(b) So long as this Trust Agreement remains in effect, the
Trust (or the Trustees acting on behalf of the Trust) shall not undertake any
business, activities or transaction except as expressly provided herein or
contemplated hereby. In particular, the Trustees shall not (i) acquire any
investments or engage in any activities not authorized by this Trust Agreement,
(ii) sell, assign, transfer, exchange, mortgage, pledge, set-off or otherwise
dispose of any of the Trust Property or interests therein, including to Holders,
except as expressly provided herein, (iii) take any action that would cause the
Trust to fail or cease to qualify as a "grantor trust" for U.S. Federal income
tax purposes, (iv) incur any indebtedness for borrowed money or issue any other
debt, (v) take or consent to any action that would result in the placement of a
Lien on any of the Trust Property, or (vi) take or cause or permit the Trust to
engage in any activity that is not consistent with the purposes of the Trust.
The Administrative Trustees shall defend all claims and demands of all Persons
at any time claiming any Lien on any of the Trust Property adverse to the
interest of the Trust or the Holders in their capacity as Holders.
(c) In connection with the issue and sale of the Preferred
Securities, the Depositor shall have the right and responsibility to assist the
Trust with respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Depositor in furtherance of the following prior to the date
of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) the preparation and filing by the Trust with the
Commission and the execution on behalf of the Trust of a registration
statement on the appropriate form in relation to the Preferred
Securities, including any amendments thereto;
(ii) 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 or on behalf of the Trust,
and the advice to the Trustees of actions they must take on behalf of
the Trust, and the preparation for execution and filing of any
documents to be executed and filed by the Trust or on behalf of the
Trust, as the Depositor deems necessary or advisable in order to comply
with the applicable laws of any such states;
(iii) the preparation for filing by the Trust and execution on
behalf of the Trust of an application to the New York Stock Exchange or
any other national stock exchange or the Nasdaq National Market for
listing upon notice of issuance of any Preferred Securities;
(iv) the preparation for 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
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the registration of the Preferred Securities under Section 12(b) or
12(g) of the Exchange Act, including any amendments thereto;
(v) the negotiation of the terms of, and the execution and
delivery of, the Underwriting Agreement providing for the sale of the
Preferred Securities; and
(vi) the taking of any other actions necessary or desirable to
carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust will not be deemed to be an
"investment company" required to be registered under the 1940 Act, or fail to be
classified as a grantor trust for U.S. Federal income tax purposes and so that
the Subordinated Debt Securities will be treated as indebtedness of the
Depositor for U.S. Federal income tax purposes. In this connection, the
Depositor and the Administrative Trustees are authorized to take any action, not
inconsistent with applicable law, the Certificate of Trust or this Trust
Agreement, that each of the Depositor and any Administrative Trustee determines
in its discretion to be necessary or desirable for such purposes, as long as
such action does not adversely affect in any material respect the interests of
the Holders of the Preferred Securities.
SECTION 2.8 Assets of Trust.
The assets of the Trust shall consist of the Trust Property.
SECTION 2.9 Title to Trust Property.
Legal title to all Trust Property shall be vested at all times
in the Property Trustee (in its capacity as such) and shall be held and
administered by the Property Trustee for the benefit of the Trust and the
Holders in accordance with this Trust Agreement.
ARTICLE III.
PAYMENT ACCOUNT
SECTION 3.1 Payment Account.
(a) On or prior to the Closing Date, the Property Trustee
shall establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making deposits in and
withdrawals from the Payment Account in accordance with this Trust Agreement.
All monies and other property deposited or held from time to time in the Payment
Account shall be held by the Property Trustee in the Payment Account for the
exclusive benefit of the Holders and for distribution as herein provided,
including (and subject to) any priority of payments provided for herein.
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(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal of or interest on, and any
other payments or proceeds with respect to, the Subordinated Debt Securities.
Amounts held in the Payment Account shall not be invested by the Property
Trustee pending distribution thereof.
ARTICLE IV.
DISTRIBUTIONS; REDEMPTION
SECTION 4.1 Distributions.
(a) The Trust Securities represent undivided beneficial
interests in the Trust Property, and Distributions (including of Additional
Amounts) will be made on the Trust Securities at the rate and on the dates that
payments of interest (including of Defaulted Interest, as defined in the
Indenture) are made on the Subordinated Debt Securities.
Accordingly:
(i) Distributions on the Trust Securities shall be cumulative,
and will accumulate whether or not there are funds of the Trust
available for the payment of Distributions. Distributions shall accrue
from --------------, 19--, and, except in the event (and to the extent)
that the Depositor exercises its right, if any, to defer the payment of
interest on the Subordinated Debt Securities pursuant to the Indenture,
shall be payable [quarterly] [semi-annually] in arrears on
---------------------------------- of each year, commencing on
--------- --, ----. If any date on which a Distribution is otherwise
payable on the Trust Securities is not a Business Day, then the payment
of such Distribution shall 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, payment of such Distribution shall be made on
the immediately preceding Business Day, in each case with the same
force and effect as if made on such date (each date on which
distributions are payable in accordance with this Section 4.1(a), a
"Distribution Date").
(ii) Assuming payments of interest on the Subordinated Debt
Securities are made when due (and before giving effect to Additional
Amounts, if applicable), Distributions on the Trust Securities shall be
payable at a rate of ----% per annum of the Liquidation Amount of the
Trust Securities. The amount of Distributions for any period less than
a full period shall be computed on the basis of a 360-day year of
twelve 30-day months. Distributions payable for each full Distribution
period will be computed by dividing the rate per annum by [four] [two].
The amount of Distributions payable for any period shall include the
Additional Amounts, if any.
(iii) Distributions on the Trust Securities shall be made by
the Property Trustee from the Payment Account and shall be payable on
each Distribution Date
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only to the extent that the Trust has funds then on hand and available
in the Payment Account for the payment of such Distributions.
(b) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Trust Securities at the close of business on the
relevant record date, which shall be the ---------- next preceding the relevant
Distribution Date; provided, however, that in the event that the Preferred
Securities do not remain in book-entry-only form, the relevant record date shall
be the ----------- next preceding the relevant Distribution Date.
SECTION 4.2 Redemption.
(a) On each Subordinated Debt Security Redemption Date and on
the stated maturity of the Subordinated Debt Securities, the Trust will be
required to redeem a Like Amount of Trust Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property
Trustee by first-class mail, postage prepaid, mailed not less than 30 nor more
than 60 days prior to the Redemption Date to each Holder of Trust Securities to
be redeemed, at such Holder's address appearing in the Security Register. All
notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price, or if the Redemption Price cannot
be calculated prior to the time the notice is required to be sent, the
estimate of the Redemption Price provided pursuant to the Indenture
together with a statement that it is an estimate and that the actual
Redemption Price will be calculated on the third Business Day prior to
the Redemption Date (and if an estimate is provided, a further notice
shall be sent of the actual Redemption Price on the date that notice of
such actual Redemption Price is received pursuant to the Indenture);
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities are to
be redeemed, the identification and the total Liquidation Amount of the
particular Trust Securities to be redeemed;
(v) that on the Redemption Date the Redemption Price will
become due and payable upon each such Trust Security to be redeemed and
that Distributions thereon will cease to accumulate on and after said
date, except as provided in Section 4.2(d) below; and
(vi) the place or places where the Trust Securities are to be
surrendered for the payment of the Redemption Price.
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(c) The Trust Securities redeemed on each Redemption Date
shall be redeemed at the Redemption Price with the proceeds from the
contemporaneous redemption of Subordinated Debt Securities. Redemptions of the
Trust Securities shall be made and the Redemption Price shall be payable on each
Redemption Date only to the extent that the Trust has funds then on hand and
available in the Payment Account for the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in
respect of any Preferred Securities, then, by 12:00 noon, New York City time, on
the Redemption Date, subject to Section 4.2(c), the Property Trustee will, with
respect to Book-Entry Preferred Securities, irrevocably deposit with the
Clearing Agency for such Book-Entry Preferred Securities funds sufficient to pay
the applicable Redemption Price and will give such Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the Holders thereof.
With respect to Preferred Securities that are not Book Entry Preferred
Securities, the Property Trustee, subject to Section 4.2(c), will irrevocably
deposit with the Paying Agent funds sufficient to pay the applicable Redemption
Price and will give the Paying Agent irrevocable instructions and authority to
pay the Redemption Price to the Holders thereof upon surrender of their
Preferred Securities Certificates. Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date for any Trust Securities called for
redemption shall be payable to the Holders of such Trust Securities as they
appear on the Securities Register for the Trust Securities on the relevant
record dates for the related Distribution Dates. If notice of redemption shall
have been given and funds deposited as required, then upon the date of such
deposit, all rights of Holders holding Trust Securities so called for redemption
will cease, except the right of such Holders to receive the Redemption Price and
any Distribution payable on or prior to the Redemption Date, but without
interest, and such Securities will cease to be outstanding. In the event that
any date on which any Redemption Price is payable 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. In the event that payment of the Redemption Price in respect of any Trust
Securities called for redemption is improperly withheld or refused and not paid
either by the Trust or by the Depositor pursuant to the Guarantee, Distributions
on such Trust Securities will continue to accumulate, at the then applicable
rate, from the Redemption Date originally established by the Trust for such
Trust Securities to the date such Redemption Price is actually paid, in which
case the actual payment date will be the date fixed for redemption for purposes
of calculating the Redemption Price.
(e) Subject to Section 4.4(a), if less than all the
Outstanding Trust Securities are to be redeemed on a Redemption Date, then the
aggregate Liquidation Amount of Trust Securities to be redeemed shall be
allocated on a pro rata basis (based on Liquidation Amounts) among the Common
Securities and the Preferred Securities. The particular Preferred Securities to
be redeemed shall be selected on a pro rata basis (based upon Liquidation
Amounts) not more than 60 days prior to the Redemption Date by the
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Property Trustee from the Outstanding Preferred Securities not previously called
for redemption, by such method (including, without limitation, by lot) as the
Property Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions of Preferred Securities, or with respect to
Book-Entry Preferred Securities, in accordance with the Clearing Agency's
customary procedures. The Property Trustee shall promptly notify the Security
Registrar in writing of the Preferred Securities selected for redemption and, in
the case of any Preferred Securities selected for partial redemption, the
Liquidation Amount thereof to be redeemed. In the event that less than all of
the Preferred Securities (other than Book-Entry Preferred Securities)
represented by a Preferred Securities Certificate are to be redeemed, upon
surrender of such Preferred Securities Certificate the Administrative Trustee,
or any one of them, shall execute and deliver to the Paying Agent, for further
delivery to the Holder of such Preferred Securities without service charge, a
new Preferred Securities Certificate representing the unredeemed Preferred
Securities evidenced by the Preferred Securities Certificate so surrendered. For
all purposes of this Trust Agreement, unless the context otherwise requires, all
provisions relating to the redemption of Preferred Securities shall relate, in
the case of any Preferred Securities redeemed or to be redeemed only in part, to
the portion of the Liquidation Amount of Preferred Securities that has been or
is to be redeemed.
SECTION 4.3 [Repayment at Option of Holders.
(a) Each Holder of Trust Securities, including the Collateral
Agent, shall have the right to require the Trust to repay all or a portion of
the Trust Securities owned by or pledged with such Holder (the "Put Option") on
the Business Day immediately preceding the Purchase Contract Settlement Date
(the "Put Option Exercise Date") at a repayment price of $----- per Trust
Security plus an amount equal to accrued Distributions thereon to the date of
payment [plus -- insert applicable repayment premium, if any] (the "Put Option
Repayment Price").
(b) The Trust will obtain funds to pay the Put Option
Repayment Price of Trust Securities being repaid under the Put Option by
presenting to the Depositor, pursuant to the Trust's right under the
Subordinated Debt Securities to require the Depositor to repay all or a portion
of the Subordinated Debt Securities on the Put Option Exercise Date,
Subordinated Debt Securities in an aggregate principal amount equal to the
aggregate stated Liquidation Amount of such Trust Securities for repayment on
the Put Option Exercise Date at the Subordinated Debt Security Repayment Price
(as defined in the Subordinated Debt Securities).
(c) In order for the Trust Securities to be repaid on the Put
Option Exercise Date, the Trust must receive at the Corporate Trust Office of
the Property Trustee, either (i) not less than 10 or more than 30 days prior to
the Put Option Exercise Date, the Trust Securities to be repaid with the form
entitled "Option to Elect Repayment" on the reverse thereof or otherwise
accompanying such Trust Security duly completed. Any such notice received by the
Trust shall be irrevocable. All questions as to the validity, eligibility
(including time of receipt) and acceptance of the Trust Securities for repayment
shall be
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determined by the Trust, whose determination shall be final and binding.
Notwithstanding the foregoing, so long as the Holder is the Collateral Agent,
such notice to elect repayment may be delivered to the Trust at any time prior
to ------- a.m., New York City time, on the Put Option Exercise Date and in the
form and manner as may be designated by the Collateral Agent.
(d) Payment of the Put Option Repayment Price to Holders of
Trust Securities shall be made at the Corporate Trust Office of the Property
Trustee, provided that the Depositor has paid the Property Trustee a sufficient
amount of cash in connection with the related repayment of the Subordinated Debt
Security. Notwithstanding the foregoing, so long as the Holder of any Trust
Securities is the Collateral Agent, the payment of the Put Option Repayment
Price in respect of such Trust Securities held by the Collateral Agent shall be
made no later than 1:00 p.m., New York City time, on the Put Option Exercise
Date by check or wire transfer in immediately available funds at such place and
to such account as may be designated by the Collateral Agent. If the Property
Trustee holds immediately available funds sufficient to pay the Put Option
Repayment Price of such Trust Securities, then, immediately prior to the close
of business on the Put Option Exercise Date, such Trust Securities will cease to
be outstanding and distributions thereon will cease to accrue, whether or not
Trust Securities are delivered to the Property Trustee, and all other rights of
the Holder in respect of the Trust Securities, including the Holder's right to
require the Trust to repay such Trust Securities, shall terminate and lapse
(other than the right to receive the Put Option Repayment Price but without
interest on such Put Option Repayment Price). Neither the Regular Trustees nor
the Trust shall be required to register or cause to be registered the transfer
of any Trust Securities for which repayment has been elected. If payment of the
Put Option Repayment Price in respect of Trust Securities is (i) improperly
withheld or refused and not paid either by the Property Trustee or by the
Depositor as guarantor pursuant to the Guarantee, or (ii) not paid by the
Property Trustee as the result of an Event of Default with respect to the
Subordinated Debt Securities presented for repayment as described in Section
4.3(b), Distributions on such Trust Securities will continue to accrue, from the
original Put Option Exercise Date to the actual date of payment, in which case
the actual payment date will be considered the Put Option Exercise Date for
purposes of calculating the Put Option Repayment Price.]
SECTION 4.4 Subordination of Common Securities.
(a) Payment of Distributions (including Additional Amounts, if
applicable) on, and the Redemption Price of, the Trust Securities, as
applicable, shall be made, subject to Section 4.2(e), pro rata among the Common
Securities and the Preferred Securities based on the Liquidation Amount of such
Common Securities and Capital Securities; provided, however, that if on any
Distribution Date or Redemption Date any Event of Default resulting from an
Indenture Event of Default shall have occurred and be continuing, no payment of
any Distribution (including Additional Amounts, if applicable) on, or Redemption
Price of, any Common Security, and no other payment on account of the
redemption, liquidation or other acquisition of Common Securities, shall be made
unless payment in full in cash of all accumulated and unpaid Distributions
(including Additional Amounts, if applicable) on all
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Outstanding Preferred Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all Outstanding Preferred Securities, shall have
been made or provided for, and all funds available to the Property Trustee shall
first be applied to the payment in full in cash of all Distributions (including
Additional Amounts, if applicable) on, or the Redemption Price of, Preferred
Securities then due and payable.
(b) In the case of the occurrence of any Event of Default
resulting from any Indenture Event of Default, the Holder of Common Securities
will be deemed to have waived any right to act with respect to any such Event of
Default under this Trust Agreement until the effect of all such Events of
Default with respect to the Preferred Securities have been cured, waived or
otherwise eliminated. Until any such Event of Default under this Trust Agreement
with respect to the Preferred Securities has been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the Holders of
the Preferred Securities and not the Holder of the Common Securities, and only
the Holders of the Preferred Securities will have the right to direct the
Property Trustee to act on their behalf.
SECTION 4.5 Payment Procedures.
Payments of Distributions (including Additional Amounts, if
applicable) in respect of the Preferred Securities shall be made by wire
transfer, at the option of the relevant Trustee, or otherwise by check mailed to
the address of the Person entitled thereto as such address shall appear on the
Securities Register, except if the Preferred Securities are held by a Clearing
Agency, such Distributions shall be made to the Clearing Agency in immediately
available funds, which shall credit the relevant Persons' accounts at such
Clearing Agency on the applicable Distribution Dates. Payments in respect of the
Common Securities shall be made in such manner as shall be mutually agreed
between the Property Trustee and the Holder of the Common Securities.
SECTION 4.6 Tax Returns and Reports.
The Administrative Trustees shall prepare (or cause to be
prepared), at the Depositor's expense, and file all U.S. Federal, state and
local tax and information returns and reports required to be filed by or in
respect of the Trust. In this regard, the Administrative Trustees shall (a)
prepare and file (or cause to be prepared and filed) the appropriate Internal
Revenue Service Form required to be filed in respect of the Trust in each
taxable year of the Trust and (b) prepare and furnish (or cause to be prepared
and furnished) to each Holder the appropriate Internal Revenue Service form
required to be provided on such form. The Administrative Trustees shall provide
the Depositor and the Property Trustee with a copy of all such returns and
reports promptly after such filing or furnishing. The Trustees shall comply with
United States Federal withholding and backup withholding tax laws and
information reporting requirements with respect to any payments to Holders under
the Trust Securities.
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On or before December 15 of each year during which any Trust
Securities are Outstanding, the Administrative Trustees shall furnish to the
Property Trustee such information as may be reasonably requested by the Property
Trustee in order that the Property Trustee may prepare the information which it
is required to report for such year on Internal Revenue Service Forms 1096 and
1099 pursuant to Section 6049 of the Code. Such information shall include the
amount of original issue discount includable in income for each outstanding
Trust Security during such year.
SECTION 4.7 Payment of Taxes, Duties, Etc. of the Trust.
Upon receipt under the Subordinated Debt Securities of
additional amounts distributed with respect to such securities as a result of
the imposition of additional taxes on the Trust, the Property Trustee shall
promptly pay any taxes, duties or governmental charges of whatsoever nature
(other than withholding taxes) imposed on the Trust by the United States or any
other taxing authority.
SECTION 4.8 Payments under Indenture or Pursuant to Direct Actions.
Any amount payable hereunder to any Holder of Preferred
Securities shall be reduced by the amount of any corresponding payment such
Holder or an Owner with respect to the Holder's Preferred Securities has
directly received pursuant to Section 5.8 of the Indenture or Section 5.14(c) of
this Trust Agreement.
ARTICLE V.
TRUST SECURITIES CERTIFICATES
SECTION 5.1 Initial Ownership.
Upon the formation of the Trust and the contribution by the
Depositor pursuant to Section 2.3 and until the issuance of the Trust
Securities, and at any time during which no Trust Securities are outstanding,
the Depositor shall be the sole beneficial owner of the Trust.
SECTION 5.2 The Trust Securities Certificates.
The Preferred Securities Certificates shall be issued in
minimum denominations of $-- Liquidation Amount and integral multiples of $-- in
excess thereof, and the Common Securities Certificates shall be issued in
denominations of $-- Liquidation Amount and integral multiples thereof. The
Trust Securities Certificates shall be executed on behalf of the Trust by manual
signature of at least one Administrative Trustee. Trust Securities Certificates
bearing the manual signatures of individuals who were, at the time when such
signatures shall have been affixed, authorized to sign on behalf of the Trust,
shall be validly issued and entitled to the benefits of this Trust Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so
authorized prior to the delivery of
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such Trust Securities Certificates or did not hold such offices at the date of
delivery of such Trust Securities Certificates. A transferee of a Trust
Securities Certificate shall become a Holder, and shall be entitled to the
rights and subject to the obligations of a Holder hereunder, upon due
registration of such Trust Securities Certificate in such transferee's name
pursuant to Section 5.4.
SECTION 5.3 Execution and Delivery of Trust Securities Certificates.
At each Time of Delivery, the Administrative Trustees shall
cause Trust Securities Certificates, in an aggregate Liquidation Amount as
provided in Sections 2.4 and 2.5, to be executed on behalf of the Trust and
delivered to or upon the written order of the Depositor, signed by its chairman
of the board, its president, any executive vice president or any vice president,
treasurer or assistant treasurer or controller without further corporate action
by the Depositor, in authorized denominations.
SECTION 5.4 Registration of Transfer and Exchange of Preferred
Securities Certificates.
The Depositor shall keep or cause to be kept, at the office or
agency maintained pursuant to Section 5.8, a register or registers for the
purpose of registering Trust Securities Certificates and transfers and exchanges
of Preferred Securities Certificates (the "Securities Register") in which, the
registrar designated by the Depositor (the "Securities Registrar"), subject to
such reasonable regulations as it may prescribe, shall provide for the
registration of Preferred Securities Certificates and Common Securities
Certificates (subject to Section 5.10 in the case of the Common Securities
Certificates) and registration of transfers and exchanges of Preferred
Securities Certificates as herein provided. The Bank shall be the initial
Securities Registrar.
Upon surrender for registration of transfer of any Preferred
Securities Certificate at the office or agency maintained pursuant to Section
5.8, the Administrative Trustees or any one of them shall execute and deliver,
in the name of the designated transferee or transferees, one or more new
Preferred Securities Certificates in authorized denominations of a like
aggregate Liquidation Amount dated the date of execution by such Administrative
Trustee or Trustees.
The Securities Registrar shall not be required to register the
transfer of any Preferred Securities that have been called for redemption. At
the option of a Holder, Preferred Securities Certificates may be exchanged for
other Preferred Securities Certificates in authorized denominations of the same
class and of a like aggregate Liquidation Amount upon surrender of the Preferred
Securities Certificates to be exchanged at the office or agency maintained
pursuant to Section 5.8.
Every Preferred Securities Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to an Administrative Trustee
and the Securities Registrar duly executed by the
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Holder or his attorney duly authorized in writing. Each Preferred Securities
Certificate surrendered for registration of transfer or exchange shall be
canceled and subsequently disposed of by an Administrative Trustee in accordance
with such Person's customary practice.
No service charge shall be made for any registration of
transfer or exchange of Preferred Securities Certificates, but the Securities
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Preferred Securities Certificates.
SECTION 5.5 Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates.
If (a) any mutilated Trust Securities Certificate shall be
surrendered to the Securities Registrar, or if the Securities Registrar shall
receive evidence to its satisfaction of the destruction, loss or theft of any
Trust Securities Certificate and (b) there shall be delivered to the Securities
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees, or any one of them, on behalf of the
Trust shall execute and make available for delivery, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a
new Trust Securities Certificate of like class, tenor and denomination. In
connection with the issuance of any new Trust Securities Certificate under this
Section, the Administrative Trustees or the Securities Registrar 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 Trust Securities
Certificate issued pursuant to this Section shall constitute conclusive evidence
of an undivided beneficial interest in the assets of the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
SECTION 5.6 Persons Deemed Holders.
The Trustees or the Securities Registrar shall treat the
Person in whose name any Trust Securities Certificate shall be registered in the
Securities Register as the owner of such Trust Securities Certificate for the
purpose of receiving Distributions and for all other purposes whatsoever, and
neither the Trustees nor the Securities Registrar shall be bound by any notice
to the contrary.
SECTION 5.7 Access to List of Holders' Names and Addresses.
Each Holder and each Owner shall be deemed to have agreed not
to hold the Depositor, the Property Trustee or the Administrative Trustees
accountable by reason of the disclosure of its name and address, regardless of
the source from which such information was derived.
SECTION 5.8 Maintenance of Office or Agency.
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The Administrative Trustees shall maintain an office or
offices or agency or agencies where Preferred Securities Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Trustees in respect of the Trust Securities Certificates
may be served. The Administrative Trustees initially designate Willamette
Industries, Inc., 1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201,
Attn: G. W. Hawley as its principal corporate trust office for such purposes.
The Administrative Trustees shall give prompt written notice to the Depositor
and to the Holders of any change in the location of the Securities Register or
any such office or agency.
SECTION 5.9 Appointment of Paying Agent.
The Paying Agent shall make distributions to Holders from the
Payment Account and shall report the amounts of such distributions to the
Property Trustee and the Administrative Trustees. Any Paying Agent shall have
the revocable power to withdraw funds from the Payment Account for the purpose
of making the distributions referred to above. The Administrative Trustees may
revoke such power and remove the Paying Agent if such Trustees determine in
their sole discretion that the Paying Agent shall have failed to perform its
obligations under this Trust Agreement in any material respect. The Paying Agent
shall initially be the Bank, and any co-paying agent chosen by the Bank, and
reasonably acceptable to the Administrative Trustees and the Depositor. Any
Person acting as Paying Agent shall be permitted to resign as Paying Agent upon
30 days' written notice to the Administrative Trustees, the Property Trustee and
the Depositor. In the event that the Bank shall no longer be the Paying Agent or
a successor Paying Agent shall resign or its authority to act be revoked, the
Administrative Trustees shall appoint a successor that is reasonably acceptable
to the Property Trustee and the Depositor to act as Paying Agent (which shall be
a bank or trust company). The Administrative Trustees shall cause such successor
Paying Agent or any additional Paying Agent appointed by the Administrative
Trustees to execute and deliver to the Trustees an instrument in which such
successor Paying Agent or additional Paying Agent shall agree with the Trustees
that as Paying Agent, such successor Paying Agent or additional Paying Agent
will hold all sums, if any, held by it for payment to the Holders in trust for
the benefit of the Holders entitled thereto until such sums shall be paid to
such Holders. The Paying Agent shall return all unclaimed funds to the Property
Trustee and upon removal of a Paying Agent such Paying Agent shall also return
all funds in its possession to the Property Trustee. The provisions of Sections
8.1, 8.3 and 8.6 herein shall apply to the Bank also in its role as Paying
Agent, for so long as the Bank shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in this
Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
SECTION 5.10 Ownership of Common Securities by Depositor.
At each Time of Delivery, the Depositor shall acquire and
retain beneficial and record ownership of the Common Securities. To the fullest
extent permitted by law, other than a transfer in connection with a
consolidation or merger of the Depositor into another corporation, or any
conveyance, transfer or lease by the Depositor of its properties and assets
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substantially as an entirety to any Person, pursuant to Section 8.1 of the
Indenture, any attempted transfer of the Common Securities shall be void. The
Administrative Trustees shall cause each Common Securities Certificate issued to
the Depositor to contain a legend stating "THIS CERTIFICATE IS NOT
TRANSFERABLE."
SECTION 5.11 Book-Entry Preferred Securities Certificates; Common
Securities Certificate.
(a) The Preferred Securities Certificates, upon original
issuance, may be issued in the form of Definitive Preferred Securities
Certificates in fully registered form or in the form of a typewritten Preferred
Securities Certificate or Certificates representing Book-Entry Preferred
Securities Certificates, to be delivered to The Depository Trust Company, the
initial Clearing Agency, by, or on behalf of, the Trust. Such Book-Entry
Preferred Securities Certificate or Certificates shall initially be registered
on the Securities Register in the name of Cede & Co., the nominee of the initial
Clearing Agency, and no Owner will receive a Definitive Preferred Securities
Certificate representing such Owner's interest in such Preferred Securities,
except as provided in Section 5.13. Unless and until Definitive Preferred
Securities Certificates have been issued to Owners pursuant to Section 5.13:
(i) the provisions of this Section 5.11(a) shall be in full
force and effect;
(ii) the Securities Registrar and the Trustees shall be
entitled to deal with the Clearing Agency for all purposes of this
Trust Agreement relating to the Book-Entry Preferred Securities
Certificates (including the payment of the Liquidation Amount of and
Distributions on the Preferred Securities evidenced by Book-Entry
Preferred Securities Certificates and the giving of instructions or
directions to Owners of Preferred Securities evidenced by Book-Entry
Preferred Securities Certificates) as the sole Holder of Preferred
Securities evidenced by Book-Entry Preferred Securities Certificates
and shall have no obligations to the Owners thereof;
(iii) to the extent that the provisions of this Section 5.11
conflict with any other provisions of this Trust Agreement, the
provisions of this Section 5.11 shall control; and
(iv) the rights of the Owners of the Book-Entry Preferred
Securities Certificates shall be exercised only through the Clearing
Agency and shall be limited to those established by law and agreements
between such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Certificate Depository Agreement, unless
and until Definitive Preferred Securities Certificates are issued
pursuant to Section 5.13, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive
and transmit payments on the Preferred Securities to such Clearing
Agency Participants.
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(b) A single Common Securities Certificate representing the
Common Securities shall be issued to the Depositor in the form of a definitive
Common Securities Certificate.
SECTION 5.12 Notices to Clearing Agency.
To the extent that a notice or other communication to the
Owners is required under this Trust Agreement, unless and until Definitive
Preferred Securities Certificates shall have been issued to Owners, the Trustees
shall give all such notices and communications specified herein to be given to
Owners to the Clearing Agency, and shall have no obligations to the Owners.
SECTION 5.13 Definitive Preferred Securities Certificates.
If (a) the Depositor advises the Trustees in writing that the
Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Preferred Securities Certificates, and the
Depositor is unable to locate a qualified successor, (b) the Depositor at its
option advises the Trustees in writing that it elects to terminate the
book-entry system through the Clearing Agency or (c) after the occurrence of an
Indenture Event of Default, Owners of Preferred Securities Certificates
representing beneficial interests aggregating at least a majority of the
Liquidation Amount advise the Administrative Trustees in writing that the
continuation of a book-entry system through the Clearing Agency is no longer in
the best interest of the Owners of Preferred Securities Certificates, then the
Administrative Trustee shall notify the Clearing Agency and the Clearing Agency
shall notify all Owners of Preferred Securities Certificates and the other
Trustees of the occurrence of any such event and of the availability of the
Definitive Preferred Securities Certificates to Owners of such class or classes,
as applicable, requesting the same. Upon surrender to the Administrative
Trustees of the typewritten Preferred Securities Certificate or Certificates
representing the Book-Entry Preferred Securities Certificates by the Clearing
Agency, accompanied by registration instructions, the Administrative Trustees,
or any one of them, shall execute the Definitive Preferred Securities
Certificates in accordance with the instructions of the Clearing Agency. Neither
the Securities Registrar nor the Trustees shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Preferred Securities Certificates, the Trustees shall recognize the Holders of
the Definitive Preferred Securities Certificates as Holders. The Definitive
Preferred Securities Certificates shall be printed, lithographed or engraved or
may be produced in any other manner as is reasonably acceptable to the
Administrative Trustees, as evidenced by the execution thereof by the
Administrative Trustees or any one of them.
SECTION 5.14 Rights of Holders.
(a) The legal title to the Trust Property is vested
exclusively in the Property Trustee (in its capacity as such) in accordance with
Section 2.9, and the Holders shall not have any right or title therein other
than the undivided beneficial interest in the
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assets of the Trust conferred by their Trust Securities and they shall have no
right to call for any partition or division of property, profits or rights of
the Trust except as described below. The Trust Securities shall be personal
property giving only the rights specifically set forth therein and in this Trust
Agreement. The Trust Securities shall have no preemptive or similar rights and
when issued and delivered to Holders against payment of the purchase price
therefor will be fully paid and nonassessable by the Trust. The Holders of the
Trust Securities, in their capacities as such, 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.
(b) For so long as any Preferred Securities remain
Outstanding, if, upon an Indenture Event of Default, the Indenture Trustee fails
or the holders of not less than 25% in principal amount of the outstanding
Subordinated Debt Securities fail to declare the principal of all of the
Subordinated Debt Securities to be immediately due and payable, the Holders of
at least 25% in Liquidation Amount of the Preferred Securities then Outstanding
shall have such right by a notice in writing to the Depositor and the Indenture
Trustee; and upon any such declaration such principal amount of and the accrued
interest on all of the Subordinated Debt Securities shall become immediately due
and payable, provided that the payment of principal and interest on such
Subordinated Debt Securities shall remain subordinated to the extent provided in
the Indenture.
At any time after such a declaration of acceleration with
respect to the Subordinated Debt Securities has been made and before a judgment
or decree for payment of the money due has been obtained by the Indenture
Trustee as in the Indenture provided, the Holders of a majority (based on
Liquidation Amounts) of the Outstanding Preferred Securities, by written notice
to the Property Trustee, the Depositor and the Indenture Trustee, may rescind
and annul such declaration and its consequences if:
(i) the Depositor has paid or deposited with the Indenture
Trustee a sum sufficient to pay
(A) all overdue installments of interest (including
any Defaulted Interest (as defined in the Indenture)) on all
of the Subordinated Debt Securities,
(B) the principal of (and premium, if any, on) any
Subordinated Debt Securities which have become due otherwise
than by such declaration of acceleration and interest thereon
at the rate borne by the Subordinated Debt Securities, and
(C) all sums paid or advanced by the Indenture
Trustee under the Indenture and the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee
and the Property Trustee, their agents and counsel; and
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(ii) all Events of Default with respect to the Subordinated
Debt Securities, other than the non-payment of the principal
of the Subordinated Debt Securities which has become due
solely by such acceleration, have been cured or waived as
provided in Section 5.13 of the Indenture.
The Holders of a majority (based on Liquidation Amounts) of
the Outstanding Preferred Securities may, on behalf of the Holders of all the
Preferred Securities, waive any past default under the Indenture, except a
default in the payment of principal or interest (unless such default has been
cured and a sum sufficient to pay all matured installments of interest and
principal due otherwise than by acceleration has been deposited with the
Indenture Trustee) or a default in respect of a covenant or provision which
under the Indenture cannot be modified or amended without the consent of the
holder of each outstanding Subordinate Debt Security. No such rescission shall
affect any subsequent default or impair any right consequent thereon.
Upon receipt by the Property Trustee of written notice
declaring such an acceleration, or rescission and annulment thereof, by Holders
of the Preferred Securities all or part of which is represented by Book-Entry
Preferred Securities Certificates, a record date shall be established for
determining Holders of Outstanding Preferred Securities entitled to join in such
notice, which record date shall be at the close of business on the day the
Property Trustee receives such notice. The Holders on such record date, or their
duly designated proxies, and only such Persons, shall be entitled to join in
such notice, whether or not such Holders remain Holders after such record date;
provided, that, unless such declaration of acceleration, or rescission and
annulment, as the case may be, shall have become effective by virtue of the
requisite percentage having joined in such notice prior to the day which is 90
days after such record date, such notice of declaration of acceleration, or
rescission and annulment, as the case may be, shall automatically and without
further action by any Holder be canceled and of no further effect. Nothing in
this paragraph shall prevent a Holder, or a proxy of a Holder, from giving,
after expiration of such 90-day period, a new written notice of declaration of
acceleration, or rescission and annulment thereof, as the case may be, that is
identical to a written notice which has been canceled pursuant to the proviso to
the preceding sentence, in which event a new record date shall be established
pursuant to the provisions of this Section 5.14(b).
(c) For so long as any Preferred Securities remain
Outstanding, to the fullest extent permitted by law and subject to the terms of
this Trust Agreement and the Indenture, upon an Indenture Event of Default
specified in Section 5.1(1) or 5.1(2) of the Indenture, any Holder of Preferred
Securities shall have the right to institute a proceeding directly against the
Depositor, pursuant to Section 5.8 of the Indenture, for enforcement of payment
to such Holder of the principal amount of or interest on Subordinated Debt
Securities having a principal amount equal to the Liquidation Amount of the
Preferred Securities of such Holder (a "Direct Action") on or after the
respective due date specified in the applicable series of Subordinated Debt
Securities. In connection with such Direct Action, the Depositor will be
subrogated to the rights of such Holder under this Trust Agreement to the extent
of any payment made by the Depositor to such Holder in such Direct Action.
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Except as set forth in Section 5.14(b) and this Section 5.14(c), the Holders of
Preferred Securities shall have no right to exercise directly any right or
remedy available to the holders of, or in respect of, the Subordinated Debt
Securities.
ARTICLE VI.
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.1 Limitations on Voting Rights.
(a) Except as provided in this Section, in Sections 5.14, 8.10
and 10.2 and in the Indenture and as otherwise required by law, no Holder of
Preferred Securities shall have any right to vote or in any manner otherwise
control the administration, operation and management of the Trust or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Trust Securities Certificates, be construed so as
to constitute the Holders from time to time as partners or members of an
association.
(b) So long as any Subordinated Debt Securities are held by
the Property Trustee, the Trustees shall not (i) direct the time, method and
place of conducting any proceeding for any remedy available to the Indenture
Trustee, or executing any trust or power conferred on the Indenture Trustee with
respect to such Subordinated Debt Securities, (ii) waive any past default which
is waivable under Section 5.13 of the Indenture, (iii) exercise any right to
rescind or annul a declaration that the principal of all the Subordinated Debt
Securities shall be due and payable or (iv) consent to any amendment,
modification or termination of the Indenture or the Subordinated Debt
Securities, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of at least a majority (based on
Liquidation Amounts) of all Outstanding Preferred Securities, provided, however,
that where a consent under the Indenture would require the consent of each
Holder of Subordinated Debt Securities affected thereby, no such consent shall
be given by the Property Trustee without the prior written consent of each
Holder of Preferred Securities. The Trustees shall not revoke any action
previously authorized or approved by a vote of the Holders of Preferred
Securities, except by a subsequent vote of the Holders of Preferred Securities.
The Property Trustee shall notify all Holders of the Preferred Securities of any
notice of default received from the Indenture Trustee with respect to the
Subordinated Debt Securities. In addition to obtaining the foregoing approvals
of the Holders of the Preferred Securities, prior to taking any of the foregoing
actions, the Trustees shall, at the expense of the Depositor, obtain an Opinion
of Counsel experienced in such matters to the effect that such action shall not
cause the Trust to fail to be classified as a grantor trust for U.S. Federal
income tax purposes.
(c) If any proposed amendment to the Trust Agreement provides
for, or the Trustees otherwise propose to effect, (i) any action that would
adversely affect in any material respect the powers, preferences or special
rights of the Preferred Securities, whether by way of amendment to the Trust
Agreement or otherwise, or (ii) the dissolution, winding-up or termination of
the Trust, other than pursuant to the terms of this Trust
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Agreement, then the Holders of Outstanding Preferred Securities as a class will
be entitled to vote on such amendment or proposal and such amendment or proposal
shall not be effective except with the approval of the Holders of at least a
majority (based on Liquidation Amounts) of the Outstanding Preferred Securities.
Notwithstanding any other provision of this Trust Agreement, no amendment to
this Trust Agreement may be made if, as a result of such amendment, it would
cause the Trust to fail to be classified as a grantor trust for U.S.
Federal income tax purposes.
SECTION 6.2 Notice of Meetings.
Notice of all meetings of the Holders of Preferred Securities,
stating the time, place and purpose of the meeting, shall be given by the
Property Trustee pursuant to Section 10.8 to each Holder of record of a
Preferred Security, at the Holder's registered address, at least 15 days and not
more than 90 days before the meeting. At any such meeting, any business properly
before the meeting may be so considered whether or not stated in the notice of
the meeting. Any adjourned meeting may be held as adjourned without further
notice.
SECTION 6.3 Meetings of Holders of Preferred Securities.
No annual meeting of Holders is required to be held. The
Administrative Trustees, however, shall call a meeting of Holders of Preferred
Securities to vote on any matter upon the written request of the Holders of
record of 25% of the Preferred Securities (based upon Liquidation Amounts) and
the Administrative Trustees or the Property Trustee may, at any time in their
discretion, call a meeting of Holders of Preferred Securities to vote on any
matters as to which Holders of Preferred Securities are entitled to vote.
Holders of record of 50% of the Outstanding Preferred
Securities (based upon Liquidation Amounts), present in person or by proxy,
shall constitute a quorum at any meeting of Holders.
If a quorum is present at a meeting, an affirmative vote by
the Holders of record of Preferred Securities present, in person or by proxy,
holding more than a majority of the Preferred Securities (based upon Liquidation
Amounts) held by the Holders of record of Preferred Securities present, either
in person or by proxy, at such meeting shall constitute the action of the
Holders of Preferred Securities, unless this Trust Agreement requires a greater
number of affirmative votes.
SECTION 6.4 Voting Rights.
Holders shall be entitled to one vote for each $----- of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Holders are entitled to vote.
SECTION 6.5 Proxies, etc.
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At any meeting of Holders, any Holder entitled to vote thereat
may vote by proxy, provided that no proxy shall be voted at any meeting unless
it shall have been placed on file with the Administrative Trustees, or with such
other officer or agent of the Trust as the Administrative Trustees may direct,
for verification prior to the time at which such vote shall be taken. Pursuant
to a resolution of the Property Trustee, proxies may be solicited in the name of
the Property Trustee or one or more officers of the Property Trustee. Only
Holders of record shall be entitled to vote. When Trust Securities are held
jointly by several persons, any one of them may vote at any meeting in person or
by proxy in respect of such Trust Securities, but if more than one of them shall
be present at such meeting in person or by proxy, and such joint owners or their
proxies so present disagree as to any vote to be cast, such vote shall not be
received in respect of such Trust Securities. A proxy purporting to be executed
by or on behalf of a Holder shall be deemed valid unless challenged at or prior
to its exercise, and the burden of proving invalidity shall rest on the
challenger. No proxy shall be valid more than three years after its date of
execution.
SECTION 6.6 Holder Action by Written Consent.
Any action which may be taken by Holders at a meeting may be
taken without a meeting if Holders holding more than a majority of all
Outstanding Trust Securities (based upon Liquidation Amounts) entitled to vote
in respect of such action (or such larger proportion thereof as shall be
required by any express provision of this Trust Agreement) shall consent to the
action in writing.
SECTION 6.7 Record Date for Voting and Other Purposes.
For the purposes of determining the Holders who are entitled
to notice of and to vote at any meeting or by written consent, or to participate
in any distribution on the Trust Securities in respect of which a record date is
not otherwise provided for in this Trust Agreement, or for the purpose of any
other action, the Administrative Trustees may from time to time fix a date, not
more than 90 days prior to the date of any meeting of Holders or the payment of
a distribution or other action, as the case may be, as a record date for the
determination of the identity of the Holders of record for such purposes.
SECTION 6.8 Acts of Holders.
Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Trust Agreement to
be given, made or taken by Holders or Owners may be embodied in and evidenced by
one or more instruments of substantially similar tenor signed by such Holders or
Owners in person or by an agent duly appointed in writing; and, except as
otherwise expressly provided herein, such action shall become effective when
such instrument or instruments are delivered to an Administrative Trustee. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders or Owners
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Trust Agreement and
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(subject to Section 8.1) conclusive in favor of the Trustees, if made in the
manner provided in this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.
The ownership of Preferred Securities shall be proved by the
Securities Register.
Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Trust Security shall bind
every future Holder of the same Trust Security and the Holder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Holder entitled hereunder to
take any action hereunder with regard to any particular Trust Security may do so
with regard to all or any part of the Liquidation Amount of such Trust Security
or by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such liquidation amount.
If any dispute shall arise between the Holders and the
Administrative Trustees or among such Holders or Trustees with respect to the
authenticity, validity or binding nature of any request, demand, authorization,
direction, consent, waiver or other Act of such Holder or Trustee under this
Article VI, then the determination of such matter by the Property Trustee shall
be conclusive with respect to such matter.
A Holder may institute a legal proceeding directly against the
Depositor under the Guarantee to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee (as defined
in the Guarantee), the Trust or any person or entity.
SECTION 6.9 Inspection of Records.
Upon reasonable notice to the Administrative Trustees and the
Property Trustee, the records of the Trust shall be open to inspection by
Holders during normal business hours for any purpose reasonably related to such
Holder's interest as a Holder.
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ARTICLE VII.
REPRESENTATIONS AND WARRANTIES
SECTION 7.1 Representations and Warranties of the Property Trustee and
the Delaware Trustee.
The Property Trustee and the Delaware Trustee, each severally
on behalf of and as to itself, hereby represents and warrants for the benefit of
the Depositor and the Holders that:
(a) the Property Trustee is a banking corporation, duly
organized, validly existing and in good standing under the laws of
[--------------------];
(b) the Property Trustee has full corporate power, authority
and legal right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;
(c) the Delaware Trustee is a Delaware corporation duly
organized, validly existing and in good standing in the State of Delaware;
(d) the Delaware Trustee has full corporate power, authority
and legal right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;
(e) this Trust Agreement has been duly authorized, executed
and delivered by the Property Trustee and the Delaware Trustee and constitutes
the valid and legally binding agreement of each of the Property Trustee and the
Delaware Trustee enforceable against each of them in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
(f) the execution, delivery and performance of this Trust
Agreement has been duly authorized by all necessary corporate or other action on
the part of the Property Trustee and the Delaware Trustee and does not require
any approval of stockholders of the Property Trustee and the Delaware Trustee
and such execution, delivery and performance will not (i) violate the Charter or
By-laws of the Property Trustee or the Delaware Trustee, (ii) violate any
provision of, or constitute, with or without notice or lapse of time, a default
under, or result in the creation or imposition of, any Lien on any properties
included in the Trust Property pursuant to the provisions of, any indenture,
mortgage, credit agreement, license or other agreement or instrument to which
the Property Trustee or the Delaware Trustee is a party or by which it is bound,
or (iii) violate any law, governmental rule or regulation of the United States
or the State of Delaware, as the case may be, governing the
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banking, trust or general powers of the Property Trustee or the Delaware Trustee
(as appropriate in context) or any order, judgment or decree applicable to the
Property Trustee or the Delaware Trustee;
(g) neither the authorization, execution or delivery by the
Property Trustee or the Delaware Trustee of this Trust Agreement nor the
consummation of any of the transactions by the Property Trustee or the Delaware
Trustee (as appropriate in context) contemplated herein or therein requires the
consent or approval of, the giving of notice to, the registration with or the
taking of any other action with respect to any governmental authority or agency
under any existing Federal law governing the banking, trust or general powers of
the Property Trustee or the Delaware Trustee, as the case may be, under the laws
of the United States or the State of Delaware;
(h) there are no proceedings pending or, to the best of each
of the Property Trustee's and the Delaware Trustee's knowledge, threatened
against or affecting the Property Trustee or the Delaware Trustee in any court
or before any governmental authority, agency or arbitration board or tribunal
which, individually or in the aggregate, would materially and adversely affect
the Trust or would question the right, power and authority of the Property
Trustee or the Delaware Trustee, as the case may be, to enter into or perform
its obligations as one of the Trustees under this Trust Agreement.
SECTION 7.2 Representations and Warranties of Depositor.
The Depositor hereby represents and warrants for the benefit
of the Holders that:
(a) the Trust Securities Certificates issued at each Time of
Delivery on behalf of the Trust have been duly authorized and will have been,
duly and validly executed, issued and delivered by the Trustees pursuant to the
terms and provisions of, and in accordance with the requirements of, this Trust
Agreement and the Holders will be, as of each such date, entitled to the
benefits of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges
payable by the Trust (or the Trustees on behalf of the Trust) under the laws of
the State of Delaware or any political subdivision thereof in connection with
the execution, delivery and performance by the Property Trustee or the Delaware
Trustee, as the case may be, of this Trust Agreement.
ARTICLE VIII.
THE TRUSTEES
SECTION 8.1 Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Trustees shall be
as provided by this Trust Agreement and, in the case of the Property Trustee, by
the Trust Indenture Act.
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Notwithstanding the foregoing, no provision of this Trust Agreement shall
require the Trustees to expend or risk their own funds or otherwise incur any
financial liability in the performance of any of their duties hereunder, or in
the exercise of any of their rights or powers, if they shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Trust Agreement relating to the
conduct or affecting the liability of or affording protection to the Trustees
shall be subject to the provisions of this Section. Nothing in this Trust
Agreement shall be construed to release an Administrative Trustee from liability
for its own gross negligent action, its own gross negligent failure to act, or
its own willful misconduct. To the extent that, at law or in equity, an
Administrative Trustee has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to the Holders, such Administrative Trustee
shall not be liable to the Trust or to any Holder for such Trustee's good faith
reliance on the provisions of this Trust Agreement. The provisions of this Trust
Agreement, to the extent that they restrict the duties and liabilities of the
Administrative Trustees otherwise existing at law or in equity, are agreed by
the Depositor and the Holders to replace such other duties and liabilities of
the Administrative Trustees.
(b) All payments made by the Property Trustee or a Paying
Agent in respect of the Trust Securities shall be made only from the revenue and
proceeds from the Trust Property and only to the extent that there shall be
sufficient revenue or proceeds from the Trust Property to enable the Property
Trustee or a Paying Agent to make payments in accordance with the terms hereof.
Each Holder, by its acceptance of a Trust Security, agrees that it will look
solely to the revenue and proceeds from the Trust Property to the extent legally
available for distribution to it as herein provided and that the Trustees are
not personally liable to it for any amount distributable in respect of any Trust
Security or for any other liability in respect of any Trust Security. This
Section 8.1(b) does not limit the liability of the Trustees expressly set forth
elsewhere in this Trust Agreement or, in the case of the Property Trustee, in
the Trust Indenture Act.
(c) No provision of this Trust Agreement 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) the Property Trustee shall not be liable for any error of
judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(ii) 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 relating to the
time, method and place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any trust or power
conferred upon the Property Trustee under this Trust Agreement;
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(iii) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Subordinated
Debt Securities and the Payment Account shall be to deal with such
Property in a similar manner as the Property Trustee deals with similar
property for its own account, subject to the protections and
limitations on liability afforded to the Property Trustee under this
Trust Agreement and the Trust Indenture Act;
(iv) the Property Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree with the
Depositor; and money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the
Payment Account maintained by the Property Trustee pursuant to Section
3.1 and except to the extent otherwise required by law; and
(v) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the
Depositor with their respective duties under this Trust Agreement, nor
shall the Property Trustee be liable for the default or misconduct of
the Administrative Trustees or the Depositor.
SECTION 8.2 Certain Notices.
Within five Business Days after the occurrence of any Event of
Default actually known to the Property Trustee, the Property Trustee shall
transmit, in the manner and to the extent provided in Section 10.8, notice of
such Event of Default to the Holders, the Administrative Trustees and the
Depositor, unless such Event of Default shall have been cured or waived.
Within five Business Days after the receipt of notice of the
Depositor's exercise of its right, if any, to defer the payment of interest on
the Subordinated Debt Securities pursuant to the Indenture, the Administrative
Trustee shall transmit, in the manner and to the extent provided in Section
10.8, notice of such exercise to the Holders and the Property Trustee, unless
such exercise shall have been revoked.
SECTION 8.3 Certain Rights of Property Trustee.
Subject to the provisions of Section 8.1:
(a) the Property Trustee may rely and shall be protected in
acting or refraining from acting in good faith upon any resolution, Opinion of
Counsel, certificate, written representation of a Holder or transferee,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond, debenture,
note, other evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;
(b) if (i) in performing its duties under this Trust Agreement
the Property Trustee is required to decide between alternative courses of action
or (ii) in construing any of
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the provisions of this Trust Agreement the Property Trustee finds the same
ambiguous or inconsistent with any other provisions contained herein or (iii)
the Property Trustee is unsure of the application of any provision of this Trust
Agreement, then, except as to any matter as to which the Holders of Preferred
Securities are entitled to vote under the terms of this Trust Agreement, the
Property Trustee shall deliver a notice to the Depositor requesting written
instructions of the Depositor as to the course of action to be taken and the
Property Trustee shall take such action, or refrain from taking such action, as
the Property Trustee shall be instructed in writing to take, or to refrain from
taking, by the Depositor; provided, however, that if the Property Trustee does
not receive such instructions of the Depositor within ten Business Days after it
has delivered such notice, or such reasonably shorter period of time set forth
in such notice (which to the extent practicable shall not be less than two
Business Days), it may, but shall be under no duty to, take or refrain from
taking such action not inconsistent with this Trust Agreement as it shall deem
advisable and in the best interests of the Holders, in which event the Property
Trustee shall have no liability except for its own bad faith, negligence or
willful misconduct;
(c) any direction or act of the Depositor or the
Administrative Trustees contemplated by this Trust Agreement shall be
sufficiently evidenced by an Officers' Certificate;
(d) whenever in the administration of this Trust Agreement,
the Property Trustee shall deem it desirable that a matter be established before
undertaking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the Depositor or
the Administrative Trustees;
(e) 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
rerecording, refiling or reregistration thereof;
(f) the Property Trustee may consult with counsel (which
counsel may be counsel to the Depositor or any of its Affiliates, and may
include any of its employees) and the advice of such counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon and in
accordance with such advice, such counsel may be counsel to the Depositor 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 Trust Agreement from any court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Trust Agreement at the
request or direction of any of the Holders pursuant to this Trust Agreement,
unless such Holders shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
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(h) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other paper
or document, unless requested in writing to do so by one or more Holders, but
the Property Trustee may make such further inquiry or investigation into such
facts or matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through its agents or attorneys, provided that the Property Trustee shall be
responsible for its own negligence or recklessness with respect to selection of
any agent or attorney appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder the Property
Trustee (i) may request instructions from the Holders of the 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
(k) except as otherwise expressly provided by this Trust
Agreement, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Trust Agreement.
No provision of this Trust Agreement shall be deemed to impose
any duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
SECTION 8.4 Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Trust Securities
Certificates shall be taken as the statements of the Trust, and the Trustees do
not assume any responsibility for their correctness. The Trustees shall not be
accountable for the use or application by the Depositor of the proceeds of the
Subordinated Debt Securities.
SECTION 8.5 May Hold Securities.
Except as provided in the definition of the term "Outstanding"
in Article I, any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other
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capacity, may become the owner or pledgee of Trust Securities and, subject to
Sections 8.8 and 8.13, may otherwise deal with the Trust with the same rights it
would have if it were not a Trustee or such other agent.
SECTION 8.6 Compensation; Indemnity; Fees.
The Depositor agrees:
(a) to pay to the Trustees from time to time reasonable
compensation for all services rendered by them hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) except as otherwise expressly provided herein, to
reimburse the Trustees upon request for all reasonable expenses, disbursements
and advances incurred or made by the Trustees in accordance with any provision
of this Trust Agreement (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad faith;
and
(c) to the fullest extent permitted by applicable law, to
indemnify and hold harmless (i) each Trustee, (ii) any Affiliate of any Trustee,
(iii) any officer, director, shareholder, employee, representative or agent of
any Trustee, and (iv) any employee or agent of the Trust or its Affiliates,
(referred to herein as an "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 conferred on such Indemnified Person by this Trust 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.
The provisions of this Section 8.6 shall survive the
termination of this Trust Agreement.
No Trustee may claim any lien or charge on any Trust Property
as a result of any amount due pursuant to this Section 8.6.
The Depositor and any Trustee (subject to Section 8.8, in the
case of 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 Trust
Agreement in and to such independent ventures or the income or profits derived
therefrom, and the pursuit of any such venture, even if competitive with the
business of the Trust, shall not be deemed wrongful or improper. Neither the
Depositor, nor any Trustee,
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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 the Depositor or any 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 Trustee may engage or be interested in any financial or other
transaction with the Depositor or any Affiliate of the Depositor, or may act as
depository for, trustee or agent for, or act on any committee or body of holders
of, securities or other obligations of the Depositor or its Affiliates.
SECTION 8.7 Corporate Property Trustee Required; Eligibility of
Trustees.
(a) There shall at all times be a Property Trustee hereunder
with respect to the Trust Securities. The Property Trustee shall be a Person
that is eligible pursuant to the Trust Indenture Act to act as such and has a
combined capital and surplus of at least $50,000,000. If any such Person
publishes reports of condition at least annually, pursuant to law or to the
requirements of its supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such Person shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Property Trustee with respect to the
Trust Securities shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
(b) There shall at all times be one or more Administrative
Trustees hereunder with respect to the Trust Securities. Each Administrative
Trustee shall be either a natural person who is at least 21 years of age or a
legal entity that shall act through one or more persons authorized to bind that
entity.
(c) There shall at all times be a Delaware Trustee with
respect to the Trust Securities. The Delaware Trustee shall either be (i) a
natural person who is at least 21 years of age and a resident of the State of
Delaware or (ii) a legal entity with its principal place of business in the
State of Delaware and that otherwise meets the requirements of applicable
Delaware law that shall act through one or more persons authorized to bind such
entity.
SECTION 8.8 Conflicting Interests.
(a) If the Property Trustee has or shall acquire a conflicting
interest within the meaning of the Trust Indenture Act, the Property Trustee
shall either eliminate such interest or resign, to the extent and in the manner
provided by, and subject to the provisions of, the Trust Indenture Act and this
Trust Agreement.
(b) The Guarantee Agreement and the Indenture shall be deemed
to be specifically described in this Trust Agreement for the purposes of clause
(i) of the first provision contained in Section 310(b) of the Trust Indenture
Act.
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SECTION 8.9 Co-Trustees and Separate Trustee.
Unless an Event of Default shall have occurred and be
continuing, at any time or times, for the purpose of meeting the legal
requirements of the Trust Indenture Act or of any jurisdiction in which any part
of the Trust Property may at the time be located, the Depositor and the
Administrative Trustees, by agreed action of the majority of such Trustees,
shall have power to appoint, and upon the written request of the Administrative
Trustees, the Depositor shall for such purpose join with the Administrative
Trustees in the execution, delivery, and performance of all instruments and
agreements necessary or proper to appoint, one or more Persons approved by the
Property Trustee either to act as co-trustee, jointly with the Property Trustee,
of all or any part of such Trust Property, or to the extent required by law to
act as separate trustee of any such property, in either case with such powers as
may be provided in the instrument of appointment, and to vest in such Person or
Persons in the capacity aforesaid, any property, title, right or power deemed
necessary or desirable, subject to the other provisions of this Section. If the
Depositor does not join in such appointment within 15 days after the receipt by
it of a request so to do, or in case an Indenture Event of Default has occurred
and is continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section shall either be (i) a natural person who is at least 21 years of age and
a resident of the United States or (ii) a legal entity with its principal place
of business in the United States that shall act through one or more persons
authorized to bind such entity.
Should any written instrument from the Depositor be required
by any co-trustee or separate trustee so appointed for more fully confirming to
such co-trustee or separate trustee such property, title, right, or power, any
and all such instruments shall, on request, be executed, acknowledged and
delivered by the Depositor.
Every co-trustee or separate trustee shall, to the extent
permitted by law, but to such extent only, be appointed subject to the following
terms, namely:
(a) The Trust Securities shall be executed and delivered and
all rights, powers, duties, and obligations hereunder in respect of the custody
of securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustees specified hereunder shall be exercised
solely by such Trustees and not by such co-trustee or separate trustee.
(b) The rights, powers, duties, and obligations hereby
conferred or imposed upon the Property Trustee in respect of any property
covered by such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-trustee
or separate trustee jointly, as shall be provided in the instrument appointing
such co-trustee or separate trustee, except to the extent that under any law of
any jurisdiction in which any particular act is to be performed, the Property
Trustee shall be incompetent or unqualified to perform such act, in which event
such rights, powers, duties and obligations shall be exercised and performed by
such co-trustee or separate trustee.
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(c) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Depositor, may
accept the resignation of or remove any co-trustee or separate trustee appointed
under this Section, and, in case an Indenture Event of Default has occurred and
is continuing, the Property Trustee shall have power to accept the resignation
of, or remove, any such co-trustee or separate trustee without the concurrence
of the Depositor. Upon the written request of the Property Trustee, the
Depositor shall join with the Property Trustee in the execution, delivery and
performance of all instruments and agreements necessary or proper to effectuate
such resignation or removal. A successor to any co-trustee or separate trustee
so resigned or removed may be appointed in the manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee or
any other trustee hereunder.
(e) The Property Trustee shall not be liable by reason of any
act of a co-trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee shall
be deemed to have been delivered to each such co-trustee and separate trustee.
SECTION 8.10 Resignation and Removal; Appointment of Successor.
No resignation or removal of any Trustee (the "Relevant
Trustee") and no appointment of a successor Trustee pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Trustee in accordance with the applicable requirements of Section 8.11.
Subject to the immediately preceding paragraph, the Relevant
Trustee may resign at any time by giving written notice thereof to the Holders.
If the instrument of acceptance by the successor Trustee required by Section
8.11 shall not have been delivered to the Relevant Trustee within 30 days after
the giving of such notice of resignation, the Relevant Trustee may petition, at
the expense of the Trust, any court of competent jurisdiction for the
appointment of a successor Relevant Trustee.
Unless an Indenture Event of Default shall have occurred and
be continuing, any Trustee may be removed or replaced, and the total number of
Trustees may be increased or decreased at any time by Act of the Holder of the
Common Securities. If an Indenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority (based on
Liquidation Amounts) of the Outstanding Preferred Securities, delivered to the
Relevant Trustee (in its individual capacity and on behalf of the Trust). An
Administrative Trustee may be removed by the Holder of the Common Securities at
any time.
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If any Trustee shall resign, be removed or become incapable of
acting as Trustee, or if a vacancy shall occur in the office of any Trustee for
any cause, at a time when no Indenture Event of Default shall have occurred and
be continuing, the Holder of the Common Securities, by Act of the Holder of the
Common Securities delivered to the retiring Trustee, shall promptly appoint a
successor Trustee or Trustees, and the retiring Trustee shall comply with the
applicable requirements of Section 8.11. If the Property Trustee or the Delaware
Trustee shall resign, be removed or become incapable of continuing to act as the
Property Trustee or the Delaware Trustee, as the case may be, at a time when an
Indenture Event of Default shall have occurred and be continuing, the Holders of
Preferred Securities, by Act of the Holders of a majority (based on Liquidation
Amounts) of the Outstanding Preferred Securities delivered to the retiring
Relevant Trustee, shall promptly appoint a successor Relevant Trustee or
Trustees, and such successor Trustee shall comply with the applicable
requirements of Section 8.11. If an Administrative Trustee shall resign, be
removed or become incapable of acting as Administrative Trustee, at a time when
an Indenture Event of Default shall have occurred and be continuing, the Holder
of the Common Securities by Act of the Holder of the Common Securities delivered
to the Administrative Trustee shall promptly appoint a successor Administrative
Trustee or Administrative Trustees and such successor Administrative Trustee or
Trustees shall comply with the applicable requirements of Section 8.11. If no
successor Relevant Trustee shall have been so appointed by the Holder of the
Common Securities or the Holders of Preferred Securities and accepted
appointment in the manner required by Section 8.11, any Holder who has been a
Holder of Trust Securities for at least six months may, on behalf of such Holder
and all others similarly situated, petition any court of competent jurisdiction
for the appointment of a successor Relevant Trustee.
The Property Trustee shall give notice of each resignation and
each removal of a Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 10.8 and shall give notice to the
Depositor. Each notice shall include the name of the successor Relevant Trustee
and the address of its Corporate Trust Office if it is the Property Trustee.
Notwithstanding the foregoing or any other provision of this
Trust Agreement, in the event any Administrative Trustee or a Delaware Trustee
who is a natural person dies or becomes, in the opinion of the Depositor,
incompetent or incapacitated, the vacancy created by such death, incompetence or
incapacity may be filled by (a) the unanimous act of the remaining
Administrative Trustees if there are at least two of them or (b) otherwise by
the Depositor (with the successor in each case being a Person who satisfies the
eligibility requirement for Administrative Trustees or Delaware Trustee, as the
case may be, set forth in Section 8.7).
SECTION 8.11 Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Relevant
Trustee, the retiring Relevant Trustee and each successor Relevant Trustee with
respect to the Trust Securities shall execute and deliver an amendment hereto
wherein each successor Relevant
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Trustee shall accept such appointment and which (a) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Relevant Trustee all the rights, powers, trusts and
duties of the retiring Relevant Trustee with respect to the Trust Securities and
the Trust and (b) shall add to or change any of the provisions of this Trust
Agreement as shall be necessary to provide for or facilitate the administration
of the Trust by more than one Relevant Trustee, it being understood that nothing
herein or in such amendment shall constitute such Relevant Trustees co-trustees
and upon the execution and delivery of such amendment the resignation or removal
of the retiring Relevant Trustee shall become effective to the extent provided
therein and each such successor Relevant Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Relevant Trustee; but, on request of the Trust or any
successor Relevant Trustee such retiring Relevant Trustee shall duly assign,
transfer and deliver to such successor Relevant Trustee all Trust Property, all
proceeds thereof and money held by such retiring Relevant Trustee hereunder with
respect to the Trust Securities and the Trust.
Upon request of any such successor Relevant Trustee, the Trust
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Relevant Trustee all such rights, powers and
trusts referred to in the first or second preceding paragraph, as the case may
be.
No successor Relevant Trustee shall accept its appointment
unless at the time of such acceptance such successor Relevant Trustee shall be
qualified and eligible under this Article.
SECTION 8.12 Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Property Trustee or the
Delaware Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which such Relevant Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of such Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article and, with respect to the Delaware Trustee, the Delaware
Business Trust Act, without the execution or filing of any paper or any further
act on the part of any of the parties hereto.
SECTION 8.13 Preferential Collection of Claims Against Depositor or
Trust.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other similar judicial proceeding relative to the Trust or any other obligor
upon the Trust Securities or the property of the Trust or of such other obligor
or their creditors, the Property Trustee (irrespective of whether any
Distributions on the Trust Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the
Property Trustee shall have made any demand on the Trust for the payment of any
past due Distributions)
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shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Trust Securities and to file
such other papers or documents as may be necessary or advisable in order to have
the claims of the Property Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel) and of the Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the
Property Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement adjustment or compensation
affecting the Trust Securities or the rights of any Holder thereof or to
authorize the Property Trustee to vote in respect of the claim of any Holder in
any such proceeding.
SECTION 8.14 Reports by Property Trustee.
(a) Not later than -------- -- of each year commencing with
- ------------, 19---, the Property Trustee shall transmit to all Holders in
accordance with Section 10.8, and to the Depositor, a brief report dated as of
the immediately preceding December 31 with respect to:
(i) its eligibility under Section 8.7 or, in lieu thereof, if
to the best of its knowledge it has continued to be eligible under said
Section, a written statement to such effect;
(ii) a statement that the Property Trustee has complied with
all of its obligations under this Trust Agreement during the
twelve-month period (or, in the case of the initial report, the period
since the Closing Date) ending with such December 31 or, if the
Property Trustee has not complied in any material respect with such
obligations, a description of such noncompliance; and
(iii) any change in the property and funds in its possession
as Property Trustee since the date of its last report and any action
taken by the Property Trustee
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in the performance of its duties hereunder which it has not previously
reported and which in its opinion materially affects the Trust
Securities.
(b) In addition the Property Trustee shall transmit to Holders
such reports concerning the Property Trustee and its actions under this Trust
Agreement as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with each national
stock exchange, the Nasdaq Stock Market or such other interdealer quotation
system or self-regulatory organization upon which the Trust Securities are
listed or traded, with the Commission and with the Depositor.
SECTION 8.15 Reports to the Property Trustee.
The Depositor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such documents, reports and
information as required by Section 314 of the Trust Indenture Act (if any) and
the compliance certificate required by Section 314(a) 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 8.16 Evidence of Compliance with Conditions Precedent.
Each of the Depositor and the Administrative Trustees on
behalf of the Trust shall provide to the Property Trustee such evidence of
compliance with any conditions precedent, if any, provided for in this Trust
Agreement that relate to any of the matters set forth in Section 314(c) of the
Trust Indenture Act. Any certificate or opinion required to be given by an
officer pursuant to Section 314(c)(1) of the Trust Indenture Act shall be given
in the form of an Officers' Certificate.
SECTION 8.17 Number of Trustees.
(a) The number of Trustees shall be four, provided that the
Holder of all of the Common Securities by written instrument may increase or
decrease the number of Administrative Trustees. The Property Trustee and the
Delaware Trustee may be the same Person.
(b) If a Trustee ceases to hold office for any reason and the
number of Administrative Trustees is not reduced pursuant to Section 8.17(a), or
if the number of Trustees is increased pursuant to Section 8.17(a), a vacancy
shall occur. The vacancy shall be filled with a Trustee appointed in accordance
with Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to annul the Trust. Whenever a vacancy in the number of Administrative Trustees
shall occur, until such
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vacancy is filled by the appointment of an Administrative Trustee in accordance
with Section 8.10, the Administrative Trustees in office, regardless of their
number (and notwithstanding any other provision of this Agreement), shall have
all the powers granted to the Administrative Trustees and shall discharge all
the duties imposed upon the Administrative Trustees by this Trust Agreement.
SECTION 8.18. Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 2.7(a), including any registration statement or
amendment thereto filed with the Commission, or making any other governmental
filing; and
(b) The Administrative Trustees shall have power to delegate
from time to time to such of their number or to the Depositor the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Administrative Trustees or otherwise as the Administrative
Trustees may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of this Trust Agreement, as set
forth herein.
ARTICLE IX.
TERMINATION, LIQUIDATION AND MERGER
SECTION 9.1 Perpetual Existence.
Unless terminated hereunder, the Trust shall have perpetual
existence.
SECTION 9.2 Early Termination.
The first to occur of any of the following events is an "Early
Termination Event":
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor;
(b) the written direction to the Property Trustee from the
Depositor at any time to terminate the Trust and distribute Subordinated Debt
Securities to Holders in exchange for the Preferred Securities (which direction
is optional and wholly within the discretion of the Depositor);
(c) the redemption of all of the Preferred Securities in
connection with the redemption of all the Subordinated Debt Securities; and
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(d) the entry of an order for dissolution of the Trust by a
court of competent jurisdiction.
SECTION 9.3 Termination.
The respective obligations and responsibilities of the
Trustees and the Trust created and continued hereby shall terminate upon the
latest to occur of the following: (a) the distribution by the Property Trustee
to Holders upon the liquidation of the Trust pursuant to Section 9.4, or upon
the redemption of all of the Trust Securities pursuant to Section 4.2, of all
amounts required to be distributed hereunder upon the final payment of the Trust
Securities; (b) the payment of any expenses owed by the Trust; and (c) the
discharge of all administrative duties of the Administrative Trustees, including
the performance of any tax reporting obligations with respect to the Trust or
the Holders.
SECTION 9.4 Liquidation.
(a) If an Early Termination Event specified in clause (a), (b)
or (d) of Section 9.2 occurs, the Trust shall be liquidated by the Trustees as
expeditiously as the Trustees determine to be possible by distributing, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, to each Holder a Like Amount of Subordinated Debt Securities, subject to
Section 9.4(d). Notice of liquidation shall be given by the Property Trustee by
first-class mail, postage prepaid mailed not later than 30 nor more than 60 days
prior to the Liquidation Date to each Holder of Trust Securities at such
Holder's address appearing in the Securities Register. All notices of
liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent a Like Amount of Subordinated Debt Securities or the right to
receive a Liquidation Distribution, as applicable; and
(iii) provide such information with respect to the mechanics
by which Holders may exchange Trust Securities Certificates for
Subordinated Debt Securities, or if Section 9.4(d) applies receive a
Liquidation Distribution, as the Administrative Trustees or the
Property Trustee shall deem appropriate.
(b) Except where Section 9.2(c) or 9.4(d) applies, in order to
effect the liquidation of the Trust and distribution of the Subordinated Debt
Securities to Holders, the Property Trustee, either itself acting as exchange
agent or through the appointment of a separate exchange agent, shall establish
such procedures as it shall deem appropriate to effect the distribution of
Subordinated Debt Securities in exchange for the Outstanding Trust Securities
Certificates.
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(c) Except where Section 9.2(c) or 9.4(d) applies, after the
Liquidation Date, (i) the Trust Securities will no longer be deemed to be
Outstanding, (ii) certificates representing a Like Amount of Subordinated Debt
Securities will be issued to holders of Trust Securities Certificates, upon
surrender of such certificates to the Administrative Trustees or their agent for
exchange, (iii) the Depositor shall use its best efforts to have the
Subordinated Debt Securities listed on the New York Stock Exchange or on such
other exchange, interdealer quotation system or self-regulatory organization as
the Preferred Securities are then listed, (iv) any Trust Securities Certificates
not so surrendered for exchange will be deemed to represent a Like Amount of
Subordinated Debt Securities, accruing interest at the rate provided for in the
Subordinated Debt Securities from the last Distribution Date on which a
Distribution was made on such Trust Securities Certificates until such
certificates are so surrendered (and until such certificates are so surrendered,
no payments of interest or principal will be made to Holders of Trust Securities
Certificates with respect to such Subordinated Debt Securities) and (v) all
rights of Holders holding Trust Securities will cease, except the right of such
Holders to receive Subordinated Debt Securities upon surrender of Trust
Securities Certificates.
(d) In the event that, notwithstanding the other provisions of
this Section 9.4, whether because of an order for dissolution entered by a court
of competent jurisdiction or otherwise, distribution of the Subordinated Debt
Securities in the manner provided herein is determined by the Property Trustee
not to be practical, the Trust Property shall be liquidated, and the Trust shall
be dissolved, wound-up or terminated, by the Property Trustee in such manner as
the Property Trustee determines. In such event, on the date of the dissolution,
winding-up or other termination of the Trust, Holders will be entitled to
receive out of the assets of the Trust available for distribution to Holders,
after satisfaction of liabilities to creditors of the Trust as provided by
applicable law, an amount equal to the Liquidation Amount per Trust Security
plus accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If, upon any such 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, subject to the next succeeding sentence, the
amounts payable by the Trust on the Trust Securities shall be paid on a pro rata
basis (based upon Liquidation Amounts). The holder of the Common Securities will
be entitled to receive Liquidation Distributions upon any such dissolution,
winding-up or termination pro rata (determined as aforesaid) with Holders of
Preferred Securities, except that, if an Indenture Event of Default has occurred
and is continuing, the Preferred Securities shall have a priority over the
Common Securities.
SECTION 9.5 Mergers, Consolidations, Amalgamations or Replacements of
the Trust.
The Trust may not merge with or into, consolidate, amalgamate,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except pursuant
to this Section 9.5. At the request of the Depositor, with the consent of the
Administrative Trustees and without the consent of the Holders of the Preferred
Securities, the Property Trustee or the Delaware Trustee, the Trust may merge
with or into, consolidate, amalgamate, or be replaced by or convey, transfer or
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lease its properties and assets substantially as an entirety to a trust
organized as such under the laws of any State; provided, that (i) such successor
entity either (a) expressly assumes all of the obligations of the Trust with
respect to the Preferred Securities or (b) substitutes for the Preferred
Securities other securities having substantially the same terms as the Preferred
Securities (the "Successor Securities") so long as the Successor Securities rank
the same as the Preferred Securities rank in priority with respect to
distributions and payments upon liquidation, redemption and otherwise, (ii) the
Depositor expressly appoints a trustee of such successor entity possessing the
same powers and duties as the Property Trustee as the holder of the Subordinated
Debt Securities, (iii) the Successor Securities are listed or traded, or any
Successor Securities will be listed upon notification of issuance, on any
national securities exchange or other organization on which the Preferred
Securities are then listed or traded, if any, (iv) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause the
Preferred Securities (including any Successor Securities) to be downgraded by
any nationally recognized statistical rating organization, (v) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the holders of the
Preferred Securities (including any Successor Securities) in any material
respect, (vi) such successor entity has a purpose identical to that of the
Trust, (vii) prior to such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, the Depositor has received an Opinion of Counsel
to the effect that (a) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the Holders of the Preferred Securities (including any
Successor Securities) in any material respect, and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the Trust nor such successor entity will be required to register as an
investment company under the 1940 Act and (viii) the Depositor owns all of the
Common Securities of such successor entity and guarantees the obligations of
such successor entity under the Successor Securities at least to the extent
provided by the Guarantee. Notwithstanding the foregoing, the Trust shall not,
except with the consent of holders of 100% in Liquidation Amount of the
Preferred Securities, 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 other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation, merger, replacement, conveyance, transfer or lease would cause the
Trust or the successor entity to be classified as other than a grantor trust for
United States Federal income tax purposes.
ARTICLE X.
MISCELLANEOUS PROVISIONS
SECTION 10.1 Limitation of Rights of Holders.
The death or incapacity of any Person having an interest,
beneficial or otherwise, in Trust Securities shall not operate to terminate this
Trust Agreement, nor entitle the legal representatives or heirs of such person
or any Holder for such Person, to claim an accounting, take any action or bring
any proceeding in any court for a partition or winding
- 52 -
<PAGE>
up of the arrangements contemplated hereby, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
SECTION 10.2 Amendment.
(a) This Trust Agreement may be amended from time to time by
the Property Trustee, the Administrative Trustees and the Depositor, without the
consent of any Holders, (i) to cure any ambiguity, correct or supplement any
provision herein which may be inconsistent with any other provision herein, or
to make any other provisions with respect to matters or questions arising under
this Trust Agreement, which shall not be inconsistent with the other provisions
of this Trust Agreement, or (ii) to modify, eliminate or add to any provisions
of this Trust Agreement to such extent as shall be necessary to ensure that the
Trust will be classified for United States Federal income tax purposes as a
grantor trust at all times that any Trust Securities are outstanding or to
ensure that the Trust will not be required to register as an investment company
under the 1940 Act; provided, however, that in the case of clause (i), such
action shall not adversely affect in any material respect the interests of any
Holder, and any amendments of this Trust Agreement shall become effective when
notice thereof is given to the Holders.
(b) Except as provided in Section 10.2(c) hereof, any
provision of this Trust Agreement may be amended by the Trustees and the
Depositor with (i) the consent of Holders representing not less than a majority
(based upon Liquidation Amounts) of the Trust Securities then Outstanding and
(ii) receipt by the Trustees of an Opinion of Counsel to the effect that such
amendment or the exercise of any power granted to the Trustees in accordance
with such amendment will not affect the Trust's status as a grantor trust for
United States Federal income tax purposes or the Trust's exemption from status
of an investment company under the 1940 Act.
(c) In addition to and notwithstanding any other provision in
this Trust Agreement, without the consent of each affected Holder (such consent
being obtained in accordance with Section 6.3 or 6.6 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date or (ii) restrict the right of a Holder to institute suit for the
enforcement of any such payment on or after such date; notwithstanding any other
provision herein, without the unanimous consent of the Holders (such consent
being obtained in accordance with Section 6.3 or 6.6 hereof), this paragraph (c)
of this Section 10.2 may not be amended.
(d) Notwithstanding any other provisions of this Trust
Agreement, no Trustee shall enter into or consent to any amendment to this Trust
Agreement which would cause the Trust to fail or cease to qualify for the
exemption from status of an investment company under the 1940 Act or fail or
cease to be classified as a grantor trust for United States Federal income tax
purposes.
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<PAGE>
(e) Notwithstanding anything in this Trust Agreement to the
contrary, without the consent of the Depositor, this Trust Agreement may not be
amended in a manner which imposes any additional obligation on the Depositor.
(f) In the event that any amendment to this Trust Agreement is
made, the Administrative Trustees shall promptly provide to the Depositor a copy
of such amendment.
(g) Neither the Property Trustee nor the Delaware Trustee
shall be required to enter into any amendment to this Trust Agreement which
affects its own rights, duties or immunities under this Trust Agreement. The
Property Trustee shall be entitled to receive an Opinion of Counsel and an
Officers' Certificate stating that any amendment to this Trust Agreement is in
compliance with this Trust Agreement.
SECTION 10.3 Separability.
In case any provision in this Trust Agreement or in the Trust
Securities Certificates shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 10.4 Governing Law.
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF
THE HOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT AND
THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAWS OF THE STATE OF DELAWARE.
SECTION 10.5 Payments Due on Non-Business Day.
If the date fixed for any payment on any Trust Security shall
be a day that is not a Business Day, then such payment need not be made on such
date but may be made on the next succeeding day that is a Business Day (except
as otherwise provided in Sections 4.1(a) and 4.2(d)), with the same force and
effect as though made on the date fixed for such payment, and no interest shall
accrue thereon for the period after such date.
SECTION 10.6 Successors.
This Trust Agreement shall be binding upon and shall inure to
the benefit of any successor to the Depositor, the Trust or the Relevant
Trustee, including any successor by operation of law. Except in connection with
a consolidation, merger or sale involving the Depositor that is permitted under
Article Eight of the Indenture and pursuant to which the assignee agrees in
writing to perform the Depositor's obligations hereunder, the Depositor shall
not assign its obligations hereunder.
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<PAGE>
SECTION 10.7 Headings.
The Article and Section headings are for convenience only and
shall not affect the construction of this Trust Agreement.
SECTION 10.8 Reports, Notices and Demands.
Any report, notice, demand or other communication which by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon any Holder or the Depositor may be given or served in writing by
deposit thereof, first-class postage prepaid, in the United States mail, hand
delivery or facsimile transmission, in each case, addressed, (a) in the case of
a Holder of Preferred Securities, to such Holder as such Holder's name and
address may appear on the Securities Register; and (b) in the case of the Holder
of the Common Securities or the Depositor, to Willamette Industries, Inc., 1300
S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201, Attention: G. W. Hawley,
facsimile no.: (503) 273-5604. Any notice to Holders of Preferred Securities
shall also be given to such owners as have, within two years preceding the
giving of such notice, filed their names and addresses with the Property Trustee
for that purpose. Such notice, demand or other communication to or upon a Holder
shall be deemed to have been sufficiently given or made, for all purposes, upon
hand delivery, mailing or transmission.
Any notice, demand or other communication which by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon the Trust, the Property Trustee, the Delaware Trustee or the
Administrative Trustees shall be given in writing addressed (until another
address is published by the Trust) as follows: (a) with respect to the Property
Trustee to [-----------------------------------------------; (b) with respect to
the Delaware Trustee, to Chase Manhattan Bank Delaware, 1201 North Market
Street, Wilmington, Delaware 19801, Attn: --------; and (c) with respect to the
Administrative Trustees, to them at the address above for notices to the
Depositor, marked "Attention Administrative Trustees of Willamette Capital I."
Such notice, demand or other communication to or upon the Trust or the Property
Trustee shall be deemed to have been sufficiently given or made only upon actual
receipt of the writing by the Trust or the Property Trustee.
SECTION 10.9 Agreement Not to Petition.
Each of the Trustees and the Depositor agree for the benefit
of the Holders that, until at least one year and one day after the Trust has
been terminated in accordance with Article IX, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Depositor takes action in violation of this Section 10.9, the
Property Trustee agrees, for the benefit of Holders, that at the expense of the
Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such
- 55 -
<PAGE>
petition by the Depositor against the Trust or the commencement of such action
and raise the defense that the Depositor has agreed in writing not to take such
action and should be stopped and precluded therefrom and such other defenses, if
any, as counsel for the Trustee or the Trust may assert. The provisions of this
Section 10.9 shall survive the termination of this Trust Agreement.
SECTION 10.10 Trust Indenture Act; Conflict with Trust Indenture Act.
(a) This Trust Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this Trust Agreement and
shall, to the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
trustee for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts
with another provision hereof which is required to be included in this Trust
Agreement by any of the provisions of the Trust Indenture Act, such required
provision shall control. If any provision of this Trust Agreement modifies or
excludes any provision of the Trust Indenture Act which may be so modified or
excluded, the latter provision shall be deemed to apply to this Trust Agreement
as so modified or excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust
Agreement shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 10.11 Acceptance of Terms of Trust Agreement, Guarantee and
Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST
THEREIN BY OR ON BEHALF OF A HOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE HOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH
TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH HOLDER AND
SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE
BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH HOLDER AND SUCH
OTHERS.
- 56 -
<PAGE>
SECTION 10.12 Expenses.
In connection with the offering, sale, and issuance of the Subordinated
Debt Securities to the Property Trustee and in connection with the sale of the
Securities, the Depositor, in its capacity as borrower with respect to the
Subordinated Debt Securities, shall:
(a) pay all costs and expenses relating to the offering, sale, and
issuance of the Subordinated Debt Securities, including commissions to the
underwriter payable pursuant to the Underwriting Agreement and compensation of
the Trustee under the Indenture in accordance with the provisions of the
Indenture;
(b) be responsible for and shall pay all debts and obligations (other
than with respect to the Trust Securities) and all costs and expenses of the
Trust (including, but not limited to, costs and expenses relating to the
organization, maintenance, and dissolution of the Trust, the offering, sale, and
issuance of the Trust Securities (including commissions to the underwriters in
connection therewith), the fees and expenses (including reasonable counsel fees
and expenses) of the Property Trustee, the Delaware Trustee, and the
Administrative Trustees, the costs and expenses relating to the operation of the
Trust, including, without limitation, costs and expenses of accountants,
attorneys, statistical or bookkeeping services, expenses for printing and
engraving and computing or accounting equipment, paying agent(s), registrar(s),
transfer agent(s), duplicating, travel and telephone and other
telecommunications expenses and costs and expenses incurred in connection with
the acquisition, financing, and disposition of Trust assets and the enforcement
by the Property Trustee of the rights of the Holders of the Preferred
Securities);
(c) be primarily liable for any indemnification obligations arising
with respect to this Declaration; and
(d) pay any and all taxes (other than Untied States withholding taxes
attributable to the Trust or its assets) and all liabilities, costs, and
expenses with respect to such taxes of the Trust.
The Depositor's obligations under this Section 10.12 shall be for the
benefit of, and shall be enforceable by, any person to whom such debts,
obligations, costs, expenses, and taxes are owed (a "Creditor") whether or not
such Creditor has received notice hereof. Any such Creditor may enforce the
Depositor's obligations under this Section 10.12 directly against the Depositor,
and the Depositor irrevocably waives any right or remedy to require that any
such Creditor take any action against the Trust or any other Person before
- 57 -
<PAGE>
proceeding against the Depositor. The Depositor agrees to execute such
additional agreements as may be necessary or desirable in order to give full
effect to the provisions of this Section 10.12.
WILLAMETTE INDUSTRIES, INC.
By: -------------------------------------
Name:
Title:
- -----------------------------------------,
as Property Trustee
By: -------------------------------------
Name:
Title:
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By: -------------------------------------
Name:
Title:
- -----------------------------------------
G. W. Hawley,
as Administrative Trustee
- -----------------------------------------
Donald C. Atkinson,
as Administrative Trustee
- 58 -
<PAGE>
EXHIBIT B
[Form of Letter to Depository Trust Company]
- 59 -
<PAGE>
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
CERTIFICATE NUMBER
NUMBER OF COMMON SECURITIES
C-1
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
WILLAMETTE CAPITAL I
- ----% COMMON SECURITIES
(LIQUIDATION AMOUNT $--- PER COMMON SECURITY)
Willamette Capital I, a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies that
Willamette Industries, Inc., (the "Holder") is the registered owner of ( )
common securities of the Trust representing beneficial interests of the Trust
and designated the ----% Common Securities (liquidation amount $--- per Common
Security) (the "Common Securities"). In accordance with Section 5.10 of the
Trust Agreement (as defined below) the Common Securities are not transferable
and any attempted transfer hereof shall be void. The designations, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities are set forth in, and this certificate and the Common
Securities represented hereby are issued and shall in all respects be subject to
the terms and provisions of, the Amended and Restated Trust Agreement of the
Trust dated as of -------, -----, as the same may be amended from time to time
(the "Trust Agreement") including the designation of the terms of the Common
Securities as set forth therein. The Trust will furnish a copy of the Trust
Agreement to the Holder without charge upon written request to the Trust at its
principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the
Trust Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, one of the Administrative Trustees of the
Trust has executed this certificate this ----- day of -------, 19--.
WILLAMETTE CAPITAL I
By:------------------------
Name:
Administrative Trustee
- 60 -
================================================================================
AMENDED AND RESTATED
DECLARATION OF TRUST AND
TRUST AGREEMENT
among
WILLAMETTE INDUSTRIES, INC., as Depositor,
[-----------------------------------------------,]
as Property Trustee,
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee,
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
Dated as of ------------------, 1997
WILLAMETTE CAPITAL II
================================================================================
<PAGE>
WILLAMETTE CAPITAL II
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Act Section Trust Agreement Section
310 (a)(1)..............................................................8.7
(a)(2)..............................................................8.7
(a)(3)..............................................................8.9
(a)(4)................................................... 2.7(a)(ii)(E)
(b).................................................................8.8
311 (a)..................................................... Not Applicable
(b)......................................................Not Applicable
312 (a)......................................................Not Applicable
(b)......................................................Not Applicable
(c).................................................................5.7
313 (a).........................................................8.14(a),(b)
(a)(4)......................................................... 8.14(b)
(b)......................................................Not Applicable
(c)................................................................10.8
(d).............................................................8.14(c)
314 (a)................................................................8.15
(b)..................................................... Not Applicable
(c)(1).............................................................8.16
(c)(2).............................................................8.16
(c)(3)...................................................Not Applicable
(d)......................................................Not Applicable
(e)...........................................................1.1, 8.16
315 (a)..................................................... 8.1(a), 8.3(a)
(b)...........................................................8.2, 10.8
(c)..............................................................8.1(a)
(d)............................................................8.1, 8.3
(e)......................................................Not Applicable
316 (a)(1)(A)............................................... Not Applicable
(a)(1)(B)..........................................................5.13
(a)(2)...................................................Not Applicable
(b)................................................................5.14
(c).................................................................6.7
317 (a)(1)...................................................Not Applicable
(a)(2).............................................................8.13
Note: This reconciliation and tie sheet shall not, for any purpose, be deemed
to be a part of the Trust Agreement.
- i -
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
ARTICLE I. DEFINED TERMS........................................................................ 2
SECTION 1.1 Definitions................................................................. 2
ARTICLE II. CONTINUATION OF THE TRUST............................................................ 10
SECTION 2.1 Name........................................................................ 10
SECTION 2.2 Office of the Delaware Trustee; Principal Place of
Business.................................................................... 10
SECTION 2.3 Initial Contribution of Trust Property; Organizational
Expenses.................................................................... 11
SECTION 2.4 Issuance of the Preferred Securities........................................ 11
SECTION 2.5 Issuance of the Common Securities; Subscription and
Purchase of Subordinated Debt Securities.................................... 11
SECTION 2.6 Declaration of Trust........................................................ 12
SECTION 2.7 Authorization to Enter into Certain Transactions............................ 12
SECTION 2.8 Assets of Trust............................................................. 16
SECTION 2.9 Title to Trust Property..................................................... 16
ARTICLE III. PAYMENT ACCOUNT............................................................................... 16
SECTION 3.1 Payment Account............................................................. 16
ARTICLE IV. DISTRIBUTIONS; REDEMPTION..................................................................... 17
SECTION 4.1 Distributions............................................................... 17
SECTION 4.2 Redemption.................................................................. 18
SECTION 4.3 [Repayment at Option of Holders............................................. 20
SECTION 4.4 Subordination of Common Securities.......................................... 21
SECTION 4.5 Payment Procedures.......................................................... 22
SECTION 4.6 Tax Returns and Reports..................................................... 22
SECTION 4.7 Payment of Taxes, Duties, Etc. of the Trust................................. 23
SECTION 4.8 Payments under Indenture or Pursuant to Direct Actions...................... 23
ARTICLE V. TRUST SECURITIES CERTIFICATES................................................................. 23
SECTION 5.1 Initial Ownership........................................................... 23
SECTION 5.2 The Trust Securities Certificates........................................... 23
SECTION 5.3 Execution and Delivery of Trust Securities Certificates..................... 24
SECTION 5.4 Registration of Transfer and Exchange of Preferred
Securities Certificates..................................................... 24
SECTION 5.5 Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates................................................................ 25
SECTION 5.6 Persons Deemed Holders...................................................... 25
SECTION 5.7 Access to List of Holders' Names and Addresses.............................. 25
SECTION 5.8 Maintenance of Office or Agency............................................. 25
SECTION 5.9 Appointment of Paying Agent................................................. 26
SECTION 5.10 Ownership of Common Securities by Depositor................................. 26
- i -
<PAGE>
SECTION 5.11 Book-Entry Preferred Securities Certificates; Common
Securities Certificate...................................................... 27
SECTION 5.12 Notices to Clearing Agency.................................................. 28
SECTION 5.13 Definitive Preferred Securities Certificates................................ 28
SECTION 5.14 Rights of Holders........................................................... 28
ARTICLE VI. ACTS OF SECURITYHOLDERS; MEETINGS; VOTING..................................................... 31
SECTION 6.1 Limitations on Voting Rights................................................ 31
SECTION 6.2 Notice of Meetings.......................................................... 32
SECTION 6.3 Meetings of Holders of Preferred Securities................................. 32
SECTION 6.4 Voting Rights............................................................... 32
SECTION 6.5 Proxies, etc................................................................ 32
SECTION 6.6 Holder Action by Written Consent............................................ 33
SECTION 6.7 Record Date for Voting and Other Purposes................................... 33
SECTION 6.8 Acts of Holders............................................................. 33
SECTION 6.9 Inspection of Records....................................................... 34
ARTICLE VII. REPRESENTATIONS AND WARRANTIES....................................................... 35
SECTION 7.1 Representations and Warranties of the Property Trustee
and the Delaware Trustee............................................................. 35
SECTION 7.2 Representations and Warranties of Depositor................................. 36
ARTICLE VIII. THE TRUSTEES......................................................................... 36
SECTION 8.1 Certain Duties and Responsibilities......................................... 36
SECTION 8.2 Certain Notices............................................................. 38
SECTION 8.3 Certain Rights of Property Trustee.......................................... 38
SECTION 8.4 Not Responsible for Recitals or Issuance of Securities............................... 40
SECTION 8.5 May Hold Securities......................................................... 40
SECTION 8.6 Compensation; Indemnity; Fees........................................................ 41
SECTION 8.7 Corporate Property Trustee Required; Eligibility of
Trustees.................................................................... 42
SECTION 8.8 Conflicting Interests................................................................ 42
SECTION 8.9 Co-Trustees and Separate Trustee............................................ 43
SECTION 8.10 Resignation and Removal; Appointment of Successor........................... 44
SECTION 8.11 Acceptance of Appointment by Successor...................................... 45
SECTION 8.12 Merger, Conversion, Consolidation or Succession to
Business.................................................................... 46
SECTION 8.13 Preferential Collection of Claims Against Depositor or
Trust....................................................................... 46
SECTION 8.14 Reports by Property Trustee................................................. 47
SECTION 8.15 Reports to the Property Trustee............................................. 48
SECTION 8.16 Evidence of Compliance with Conditions Precedent............................ 48
SECTION 8.17 Number of Trustees.......................................................... 48
SECTION 8.18. Delegation of Power......................................................... 49
- ii -
<PAGE>
ARTICLE IX. TERMINATION, LIQUIDATION AND MERGER........................................................... 49
SECTION 9.1 Perpetual Existence......................................................... 49
SECTION 9.2 Early Termination........................................................... 49
SECTION 9.3 Termination................................................................. 50
SECTION 9.4 Liquidation................................................................. 50
SECTION 9.5 Mergers, Consolidations, Amalgamations or
Replacements of the Trust................................................... 51
ARTICLE X. MISCELLANEOUS PROVISIONS...................................................................... 52
SECTION 10.1 Limitation of Rights of Holders............................................. 52
SECTION 10.2 Amendment................................................................... 53
SECTION 10.3 Separability................................................................ 54
SECTION 10.4 Governing Law............................................................... 54
SECTION 10.5 Payments Due on Non-Business Day............................................ 54
SECTION 10.6 Successors.................................................................. 54
SECTION 10.7 Headings.................................................................... 55
SECTION 10.8 Reports, Notices and Demands................................................ 55
SECTION 10.9 Agreement Not to Petition................................................... 55
SECTION 10.10 Trust Indenture Act; Conflict with Trust Indenture Act...................... 56
SECTION 10.11 Acceptance of Terms of Trust Agreement, Guarantee and
Indenture................................................................... 56
SECTION 10.12 Expenses.................................................................... 57
EXHIBIT B FORM OF LETTER TO DEPOSITORY TRUST COMPANY........................................... 59
EXHIBIT C....................................................................................................... 60
</TABLE>
- iii -
<PAGE>
AMENDED AND RESTATED DECLARATION OF TRUST AND TRUST AGREEMENT,
dated as of __________________, 1997, among (i) Willamette Industries, Inc., an
Oregon corporation (including any successors or assigns, the "Depositor"), (ii)
[__________________________], a national banking corporation duly organized and
existing under the laws of [_____________], as property trustee, (in each such
capacity, the "Property Trustee" and, in its separate corporate capacity and not
in its capacity as Property Trustee, the"Bank"), (iii) Chase Manhattan Bank
Delaware, a banking corporation duly organized and existing under the laws of
the State of Delaware, as Delaware trustee (the"Delaware Trustee"), (iv) G. W.
Hawley, an individual, and Donald C. Atkinson, an individual, each of whose
address is c/o Willamette Industries, Inc., 1300 S.W. Fifth Avenue, Suite 3800,
Portland, Oregon 97201 (each an "Administrative Trustee" and collectively the
"Administrative Trustees") (the Property Trustee, the Delaware Trustee and the
Administrative Trustees referred to collectively as the"Trustees") and (v) the
several Holders, as hereinafter defined.
WITNESSETH
WHEREAS, the Depositor, the Delaware Trustee, and the
Administrative Trustees have previously duly declared and established a business
trust pursuant to the Delaware Business Trust Act, by entering into a
Declaration of Trust dated as of July 30, 1997 (the "Original Trust Agreement"),
and by executing and filing with the Secretary of State of the State of Delaware
of the Certificate of Trust, filed on July 31, 1997, attached as Exhibit A; and
WHEREAS, the Depositor and the Trustees desire to duly declare
and establish a business trust pursuant to the Delaware Business Trust Act and
the Certificate of Trust by entering into this Trust Agreement to restate and
amend the Original Trust Agreement to provide for, among other things, (i) the
issuance of the Common Securities by the Trust to the Depositor, (ii) the
issuance and sale of the Preferred Securities by the Trust pursuant to the
Underwriting Agreement, (iii) the acquisition by the Trust from the Depositor of
all of the right, title and interest in the Subordinated Debt Securities and
(iv) the appointment of the Property Trustee and Administrative Trustees;
NOW THEREFORE, in consideration of the agreements and
obligations set forth herein and for other good and valuable consideration, the
sufficiency of which is hereby acknowledged, each party, for the benefit of the
other parties and for the benefit of the Holders, hereby amends and restates the
Original Trust Agreement in its entirety and agrees as follows:
- 1 -
<PAGE>
ARTICLE I.
DEFINED TERMS
SECTION 1.1 Definitions.
For all purposes of this Trust Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Trust Agreement; and
(d) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.8.
"Additional Amount" means, with respect to Trust Securities of
a given Liquidation Amount and/or a given period, the amount of Defaulted
Interest (as defined in the Indenture) paid by the Depositor on Subordinated
Debt Securities having an aggregate principal amount equal to such given
Liquidation Amount for such period.
"Administrative Trustee" means each of the Persons identified
as an "Administrative Trustee" in the preamble to this Trustee Agreement solely
in such Person's capacity as Administrative Trustee of the Trust formed and
continued hereunder and not in such Person's individual capacity, or such
Administrative Trustee's successor in interest in such capacity, or any
successor trustee appointed as herein provided.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" has the meaning specified in the preamble to this Trust
Agreement.
- 2 -
<PAGE>
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having
jurisdiction in the premises judging such Person a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization, arrangement,
adjudication or composition of or in respect of such Person under any applicable
Federal or State bankruptcy, insolvency, reorganization or other similar law, or
appointing a receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of such Person or of any substantial part of its property or
ordering the winding up or liquidation of its affairs, and the continuance of
any such decree or order unstayed and in effect for a period of 60 consecutive
days; or
(b) the institution by such Person of proceedings to be
adjudicated a bankrupt or insolvent, or the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it of a
petition or answer or consent seeking reorganization or relief under any
applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law, or the consent by it to the filing of any such petition or to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or
similar official) of such Person or of any substantial part of its property, or
the making by it of an assignment for the benefit of creditors, or the admission
by it in writing of its inability to pay its debts generally as they become due
and its willingness to be adjudicated a bankrupt, or the taking of corporate
action by such Person in furtherance of any such action.
"Bankruptcy Laws" has the meaning specified in Section 10.9.
"Book-Entry Preferred Securities Certificates" means a
beneficial interest in the Preferred Securities Certificates, ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 5.11.
"Business Day" means a day other than (a) a Saturday or
Sunday, (b) a day on which banking institutions in The City of New York are
authorized or required by law or executive order to remain closed, or (c) a day
on which the Property Trustee's Corporate Trust Office or the Corporate Trust
Office of the Indenture Trustee is closed for business.
"Certificate Depository Agreement" means the agreement among
the Trust, the Depositor and The Depository Trust Company, as the initial
Clearing Agency, dated as of the Closing Date, relating to the Trust Securities
Certificates, substantially in the form attached as Exhibit B, as the same may
be amended and supplemented from time to time.
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository Trust Company will be the initial Clearing
Agency.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
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"Closing Date" means the First Time of Delivery, which date is
also the date of execution and delivery of this Trust Agreement.
["Collateral Agent" shall mean -------------------, as
collateral agent under the Pledge Agreement, dated the date hereof, among the
Depositor, the collateral agent, -------------, as purchase contract agent and
the holders from time to time of the Depositor's ---% Automatic Convertible
Exchange Securities.]
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934, as amended, 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 Security" means an undivided beneficial interest in
the assets of the Trust, having a Liquidation Amount of $----------- and having
the rights provided therefor in this Trust Agreement, including the right to
receive Distributions and a Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as Exhibit C.
"Corporate Trust Office" means (i) when used with respect to
the Property Trustee, the principal office of the Property Trustee located in
[NEW YORK, NEW YORK], and (ii) when used with respect to the Indenture Trustee,
the principal office of the Indenture Trustee located in
[-----------------------].
"Creditor" has the meaning specified in Section 10.12.
"Definitive Preferred Securities Certificates" means either or
both (as the context requires) of (a) Preferred Securities Certificates issued
as Book-Entry Preferred Securities Certificates as provided in Section 5.11(a)
and (b) Preferred Securities Certificates issued in certificated, fully
registered form upon original issuance thereof or as provided in Section 5.13.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of
the Delaware Code, 12 Del. C. (Section) 3801, et seq., as it may be amended from
time to time.
"Delaware Trustee" means the Person identified as the
"Delaware Trustee" in the preamble to this Trust Agreement solely in its
capacity as Delaware Trustee of the Trust formed and continued hereunder and not
in its individual capacity, or its successor in interest in such capacity, or
any successor trustee appointed as herein provided.
"Depositor" has the meaning specified in the preamble to this
Trust Agreement.
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"Direct Action" has the meaning specified in Section 5.14.
"Distribution Date" has the meaning specified in Section
4.1(a).
"Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 4.1.
"Early Termination Event" has the meaning specified in Section
9.2.
"Event of Default" means any one of the following events
(whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of an Indenture Event of Default; or
(b) default by the Property Trustee in the payment of any
Distribution when it becomes due and payable, and continuation of such default
for a period of 30 days; or
(c) default by the Property Trustee in the payment of any
Redemption Price of any Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material
respect, of any covenant or warranty of the Trustees in this Trust Agreement
(other than a covenant or warranty a default in the performance or breach of
which is dealt with in clause (b) or (c) above) and continuation of such default
or breach for a period of 60 days after there has been given, by registered or
certified mail, to the defaulting Trustee or Trustees by the Holders of at least
25% in aggregate liquidation preference of the Outstanding Preferred Securities
a written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the
Property Trustee and the failure by the Depositor to appoint a successor
Property Trustee within 60 days thereof.
"Exchange Act" means the Securities Exchange Act of 1934, and
any successor statute thereto, in each case as amended from time to time.
"First Time of Delivery" has the meaning specified in the
Underwriting Agreement.
"Guarantee" means the Guarantee Agreement executed and
delivered by the Depositor and [--------------------------], as trustee,
contemporaneously with the
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execution and delivery of this Trust Agreement, for the benefit of the holders
of the Preferred Securities, as amended from time to time.
"Holder" or "Securityholder"means a Person in whose name a
Trust Security or Trust Securities is registered in the Securities Register; any
such Person shall be deemed to be a beneficial owner within the meaning of the
Delaware Business Trust Act.
"Indemnified Person" has the meaning specified in Section 8.6.
"Indenture" means the Indenture of Subordinated Debt
Securities, dated as of --------------, 1997, between the Depositor and the
Indenture Trustee, as trustee, as amended or supplemented from time to time.
"Indenture Event of Default" means an "Event of Default" as
defined in the Indenture.
"Indenture Redemption Date" means, with respect to any
Subordinated Debt Securities to be redeemed under the Indenture, the date fixed
for redemption under the Indenture.
"Indenture Trustee" means [---------------------------------],
a banking corporation duly organized under the laws of the State of
[---------------], and any successor thereto.
"Lien" means any lien, pledge, charge, encumbrance, mortgage,
deed of trust, adverse ownership interest, hypothecation, assignment, security
interest or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to that portion
of the principal amount of Subordinated Debt Securities to be contemporaneously
redeemed in accordance with the Indenture, allocated to the Common Securities
and to the Preferred Securities based upon the relative Liquidation Amounts of
such classes of Trust Securities and the proceeds of which will be used to pay
the Redemption Price of such Trust Securities, and (b) with respect to a
distribution of Subordinated Debt Securities to Holders of Trust Securities in
connection with a dissolution or liquidation of the Trust, Subordinated Debt
Securities having a principal amount equal to the Liquidation Amount of the
Trust Securities of the Holder to whom such Subordinated Debt Securities are
distributed.
"Liquidation Amount" means the stated amount of $--- per Trust
Security.
"Liquidation Date" means the date on which Subordinated Debt
Securities are to be distributed to Holders of Trust Securities in connection
with a termination and liquidation of the Trust pursuant to Section 9.4(a).
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"Liquidation Distribution" has the meaning specified in
Section 9.4(d).
"1940 Act" means the Investment Company Act of 1940, as
amended.
"Officers' Certificate" means a certificate signed by the
Chairman and Chief Executive Officer, President or a Vice President, and by the
Treasurer, an Associate Treasurer, an Assistant Treasurer, the Controller, the
Secretary or an Assistant Secretary, of the Depositor, and delivered to the
appropriate Trustee. One of the officers signing an Officers' Certificate given
pursuant to Section 8.16 shall be the principal executive, financial or
accounting officer of the Depositor. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this Trust
Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions relating
thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering the
Officers' Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is necessary to
enable such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who
may be counsel for the Trust, the Property Trustee or the Depositor, but not an
employee of any thereof, and who shall be reasonably acceptable to the Property
Trustee.
"Original Trust Agreement" has the meaning specified in the
recitals to this Trust Agreement.
"Outstanding", when used with respect to Trust Securities,
means, as of the date of determination, all Trust Securities theretofore
executed and delivered under this Trust Agreement, except:
(a) Trust Securities theretofore canceled by the Property
Trustee or delivered to the Property Trustee for cancellation;
(b) Trust Securities for whose payment or redemption money in
the necessary amount has been theretofore deposited with the Property Trustee or
any Paying Agent for the Holders of such Trust Securities; provided that, if
such Trust Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Trust Agreement; and
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(c) Trust Securities which have been paid or in exchange for
or in lieu of which other Preferred Securities have been executed and delivered
pursuant to Sections 5.4, 5.5, 5.11 and 5.13; provided, however, that in
determining whether the Holders of the requisite Liquidation Amount of the
Outstanding Preferred Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Preferred Securities owned by
the Depositor, any Trustee or any Affiliate of the Depositor or any Trustee
shall be disregarded and deemed not to be Outstanding, except that (a) in
determining whether any Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Preferred Securities that such Trustee knows to be so owned shall be so
disregarded and (b) the foregoing shall not apply at any time when all of the
outstanding Preferred Securities are owned by the Depositor, one or more of the
Trustees and/or any such Affiliate. Preferred Securities so owned which have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Administrative Trustees the pledgee's
right so to act with respect to such Preferred Securities and that the pledgee
is not the Depositor or any Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of a
Book-Entry Preferred Securities Certificate as reflected in the records of the
Clearing Agency or, if a Clearing Agency Participant is not the Owner, then as
reflected in the records of a Person maintaining an account with such Clearing
Agency (directly or indirectly, in accordance with the rules of such Clearing
Agency).
"Paying Agent" means any paying agent or co-paying agent
appointed pursuant to Section 5.9 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing
corporate trust account maintained by the Property Trustee with the Bank in its
trust department for the benefit of the Holders in which all amounts paid in
respect of the Subordinated Debt Securities will be held and from which the
Property Trustee, through the Paying Agent, shall make payments to the Holders
in accordance with Sections 4.1 and 4.2.
"Person" means any individual, corporation, partnership, joint
venture, trust, limited liability company or corporation, unincorporated
organization or government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial interest in
the assets of the Trust, having a Liquidation Amount of $-- and having the
rights provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Securities Certificate" means a certificate
evidencing ownership of Preferred Securities, substantially in the form attached
as Exhibit E.
"Property Trustee" means the Person identified as the
"Property Trustee" in the preamble to this Trust Agreement solely in its
capacity as Property Trustee of the Trust
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heretofore formed and continued hereunder and not in its individual capacity, or
its successor in interest in such capacity, or any successor property trustee
appointed as herein provided.
["Purchase Contract Settlement Date" means
- ------------------------, ----.]
["Put Option" shall have the meaning specified in Section
4.3.]
["Put Option Exercise Date" shall have the meaning specified
in Section 4.3.]
["Put Option Exercise Price" shall have the meaning specified
in Section 4.3.]
"Redemption Date" means, with respect to any Trust Security to
be redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided that each Subordinated Debt Security Redemption Date and the
stated maturity of the Subordinated Debt Securities shall be a Redemption Date
for a Like Amount of Trust Securities.
"Redemption Price" means, with respect to any Trust Security,
the Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, plus the related amount of the premium, if
any, paid by the Depositor upon the concurrent redemption of a Like Amount of
Subordinated Debt Securities, allocated on a pro rata basis (based on
Liquidation Amounts) among the Trust Securities.
"Relevant Trustee" shall have the meaning specified in Section
8.10.
"Second Time of Delivery" has the meaning specified in the
Underwriting Agreement.
"Securities Register" and "Securities Registrar" have the
respective meanings specified in Section 5.4.
"Subordinated Debt Securities" means the aggregate principal
amount of the Depositor's -----% [Notes/Subordinated Debt Securities], Series -,
issued pursuant to the Indenture.
"Time of Delivery" means, collectively, the First Time of
Delivery and the Second Time of Delivery.
"Trust" means the Delaware business trust created and
continued hereby and identified on the cover page to this Trust Agreement.
"Trust Agreement" means this Trust Agreement, as the same may
be modified, amended or supplemented in accordance with the applicable
provisions hereof, including (i) all exhibits hereto and (ii) for all purposes
of this Trust Agreement and any such
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modification, amendment or supplement, the provisions of the Trust Indenture Act
that are deemed to be a part of and govern this Trust Agreement and any such
modification, amendment or supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed; provided,
however, that in the event the Trust Indenture Act of 1939 is amended after such
date, "Trust Indenture Act" means, to the extent required by any such amendment,
the Trust Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Subordinated Debt Securities,
(b) the rights of the Property Trustee under the Guarantee, (c) any cash on
deposit in, or owing to, the Payment Account and (d) all proceeds and rights in
respect of the foregoing and any other property and assets for the time being
held or deemed to be held by the Property Trustee pursuant to the trusts of this
Trust Agreement.
"Trust Security" means any one of the Common Securities or the
Preferred Securities.
"Trust Securities Certificate" means any one of the Common
Securities Certificates or the Preferred Securities Certificates.
"Trustees" means, collectively, the Property Trustee, the
Delaware Trustee and the Administrative Trustees.
"Underwriting Agreement" means the Pricing Agreement, dated as
of ----------- --, 1997, among the Trust, the Depositor and the underwriters
named therein incorporating the Underwriting Agreement dated --------- --, 1997.
ARTICLE II.
CONTINUATION OF THE TRUST
SECTION 2.1 Name.
The Trust continued hereby shall be known as "Willamette
Capital II," as such name may be modified from time to time by the
Administrative Trustees following written notice to the Holders of Trust
Securities and the other Trustees, in which name the Trustees may conduct the
business of the Trust, make and execute contracts and other instruments on
behalf of the Trust and sue and be sued.
SECTION 2.2 Office of the Delaware Trustee; Principal Place of
Business.
The address of the Delaware Trustee in the State of Delaware
is 1201 North Market Street, Wilmington, Delaware 19801, or such other address
in the State of Delaware as the Delaware Trustee may designate by written notice
to the Holders and the Depositor.
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The principal executive office of the Trust is c/o Willamette Industries, Inc.,
1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201.
SECTION 2.3 Initial Contribution of Trust Property;
Organizational Expenses.
The Property Trustee acknowledges receipt in trust from the
Depositor in connection with the Original Trust Agreement of the sum of $10,
which constituted the initial Trust Property. The Depositor shall pay
organizational expenses of the Trust as they arise or shall, upon request of any
Trustee, promptly reimburse such Trustee for any such expenses paid by such
Trustee. The Depositor shall make no claim upon the Trust Property for the
payment of such expenses.
SECTION 2.4 Issuance of the Preferred Securities.
Pursuant to the Original Trust Agreement, on -----------,
199-, the Depositor on behalf of the Trust executed and delivered the
Underwriting Agreement and, contemporaneously with the execution and delivery
hereof, an Administrative Trustee, on behalf of the Trust, shall execute in
accordance with Section 5.2 and deliver to the Underwriters named in the
Underwriting Agreement Preferred Securities Certificates, registered in the name
of the nominee of the initial Clearing Agency, in an aggregate amount of
- ----------- Preferred Securities having an aggregate Liquidation Amount of
$-----------, against receipt of such aggregate purchase price of such Preferred
Securities of $-----------, which amount the Administrative Trustee shall
promptly deliver to the Property Trustee. If there is a Second Time of Delivery,
an Administrative Trustee, on behalf of the Trust, shall execute in accordance
with Section 5.2 and deliver to the Underwriters named in the Underwriting
Agreement Preferred Securities Certificates, registered in the name of the
nominee of the initial Clearing Agency, in an aggregate amount of up to
- ---------- Preferred Securities having an aggregate Liquidation Amount of up to
$-----------, against receipt of the aggregate purchase price of such Preferred
Securities equal to the Liquidation Amount thereof, which amount such
Administrative Trustee shall promptly deliver to the Property Trustee.
SECTION 2.5 Issuance of the Common Securities; Subscription and
Purchase of Subordinated Debt Securities.
Contemporaneously with the execution and delivery of this
Trust Agreement, an Administrative Trustee, on behalf of the Trust, shall
execute in accordance with Section 5.2 and deliver to the Depositor Common
Securities Certificates, registered in the name of the Depositor, in an
aggregate amount of ------- Common Securities having an aggregate Liquidation
Amount of $------------ against payment by the Depositor of such amount, which
amount such Administrative Trustee shall promptly deliver to the Property
Trustee. Contemporaneously therewith, an Administrative Trustee, on behalf of
the Trust, shall subscribe to and purchase from the Depositor Subordinated Debt
Securities, registered in the name of the Trust and having an aggregate
principal amount equal to $---------, and, in satisfaction of the purchase price
for such Subordinated Debt Securities, the Property
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Trustee, on behalf of the Trust, shall deliver to the Depositor the sum of
$--------- (being the sum of the amounts delivered to the Property Trustee
pursuant to (i) the first sentence of Section 2.4 and (ii) the first sentence of
this Section 2.5). If there is a Second Time of Delivery, an Administrative
Trustee, on behalf of the Trust, shall execute in accordance with Section 5.2
and deliver to the Depositor Common Securities Certificates, registered in the
name of the Depositor, in an aggregate amount of up to ------- Common Securities
having an aggregate Liquidation Amount of up to $---------- against payment by
the Depositor of such amount, which amount such Administrative Trustee shall
promptly deliver to the Property Trustee. Contemporaneously therewith, an
Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase
from the Depositor Subordinated Debt Securities, registered in the name of the
Trust and having an aggregate principal amount of up to $-----------, and, in
satisfaction of the purchase price for such Subordinated Debt Securities, the
Property Trustee, on behalf of the Trust, shall deliver to the Depositor the
amount received from one of the Administrative Trustees pursuant to the last
sentence of Section 2.4 (being the sum of the amounts delivered to the Property
Trustee pursuant to (i) the second sentence of Section 2.4 and (ii) the third
sentence of this Section 2.5).
SECTION 2.6 Declaration of Trust.
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 Debt Securities, and (b) to engage in those activities
necessary or incidental thereto. The Depositor hereby appoints the Trustees as
trustees of the Trust, to have all the rights, powers and duties to the extent
set forth herein, and the Trustees hereby accept such appointment. The Property
Trustee hereby declares that it will hold the Trust Property in trust upon and
subject to the conditions set forth herein for the benefit of the Trust and the
Securityholders. The Administrative Trustees shall have all rights, powers and
duties set forth herein and in accordance with applicable law with respect to
accomplishing the purposes of the Trust. The Delaware Trustee shall not be
entitled to exercise any powers, nor shall the Delaware Trustee have any of the
duties and responsibilities, of the Property Trustee or the Administrative
Trustees set forth herein. The Delaware Trustee shall be one of the Trustees of
the Trust for the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Delaware Business Trust Act.
SECTION 2.7 Authorization to Enter into Certain Transactions.
(a) The Trustees shall conduct the affairs of the Trust in
accordance with the terms of this Trust Agreement. Subject to the limitations
set forth in paragraph (b) of this Section, and in accordance with the following
provisions (i) and (ii), the Trustees shall have the authority to enter into all
transactions and agreements determined by the Trustees to be appropriate in
exercising the authority, express or implied, otherwise granted to the Trustees
under this Trust Agreement, and to perform all acts in furtherance thereof,
including without limitation, the following:
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(i) As among the Trustees, each Administrative Trustee shall
have the power and authority to act on behalf of the Trust with respect
to the following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust, the Certificate
Depository Agreement and such other agreements as may be
necessary or desirable in connection with the purposes and
function of the Trust;
(C) assisting in the registration of the Preferred
Securities under the Securities Act of 1933, as amended, and
under state securities or blue sky laws, and the qualification
of this Trust Agreement as a trust indenture under the Trust
Indenture Act;
(D) assisting in the listing of the Preferred
Securities upon such securities exchange or exchanges as shall
be determined by the Depositor and the registration of the
Preferred Securities under the Exchange Act, and the
preparation and filing of all periodic and other reports and
other documents pursuant to the foregoing;
(E) the sending of notices (other than notices of
default) and other information regarding the Trust Securities
and the Subordinated Debt Securities to the Holders in
accordance with this Trust Agreement;
(F) the appointment of a Paying Agent, authenticating
agent and Securities Registrar in accordance with this Trust
Agreement;
(G) execution of the Trust Securities in accordance
with this Trust Agreement and execution and delivery of
closing certificates pursuant to the Underwriting Agreement;
(H) registering transfer of the Trust Securities in
accordance with this Trust Agreement;
(I) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the Trust
and the preparation, execution and filing of the certificate
of cancellation with the Secretary of State of the State of
Delaware;
(J) unless otherwise determined by the Depositor, the
Property Trustee or the Administrative Trustees, or as
otherwise required by the Delaware Business Trust Act or the
Trust Indenture Act, to execute on behalf of the Trust (either
acting alone or together with any or all of the
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Administrative Trustees) any documents that the Administrative
Trustees have the power to execute pursuant to this Trust
Agreement; and
(K) the taking of any action incidental to the
foregoing as the Trustees may from time to time determine is
necessary or advisable to give effect to the terms of this
Trust Agreement for the benefit of the Holders (without
consideration of the effect of any such action on any
particular Holder).
(ii) As among the Trustees, the Property Trustee shall have
the power, duty and authority to act on behalf of the Trust with
respect to the following matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Subordinated Debt Securities;
(C) the collection of interest, principal and any
other payments made in respect of the Subordinated Debt
Securities in the Payment Account;
(D) the distribution through the Paying Agent of
amounts owed to the Holders in respect of the Trust
Securities;
(E) the exercise of all of the rights, powers and
privileges of a holder of the Subordinated Debt Securities;
(F) the sending of notices of default and other
information regarding the Trust Securities and the
Subordinated Debt Securities to the Holders in accordance with
this Trust Agreement;
(G) the distribution of the Trust Property in
accordance with the terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the Trust
and the preparation, execution and filing of the certificate
of cancellation with the Secretary of State of the State of
Delaware;
(I) after an Event of Default (other than under
paragraph (b), (c), (d) or (e) of the definition of such term
if such Event of Default is by or with respect to the Property
Trustee) the taking of any action incidental to the foregoing
as the Property Trustee may from time to time determine is
necessary or advisable to give effect to the terms of this
Trust Agreement and protect and conserve the Trust Property
for the benefit of the Holders (without consideration of the
effect of any such action on any particular Holder); and
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(J) except as otherwise provided in this Section
2.7(a)(ii), the Property Trustee shall have none of the
duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 2.7(a)(i).
(b) So long as this Trust Agreement remains in effect, the
Trust (or the Trustees acting on behalf of the Trust) shall not undertake any
business, activities or transaction except as expressly provided herein or
contemplated hereby. In particular, the Trustees shall not (i) acquire any
investments or engage in any activities not authorized by this Trust Agreement,
(ii) sell, assign, transfer, exchange, mortgage, pledge, set-off or otherwise
dispose of any of the Trust Property or interests therein, including to Holders,
except as expressly provided herein, (iii) take any action that would cause the
Trust to fail or cease to qualify as a "grantor trust" for U.S. Federal income
tax purposes, (iv) incur any indebtedness for borrowed money or issue any other
debt, (v) take or consent to any action that would result in the placement of a
Lien on any of the Trust Property, or (vi) take or cause or permit the Trust to
engage in any activity that is not consistent with the purposes of the Trust.
The Administrative Trustees shall defend all claims and demands of all Persons
at any time claiming any Lien on any of the Trust Property adverse to the
interest of the Trust or the Holders in their capacity as Holders.
(c) In connection with the issue and sale of the Preferred
Securities, the Depositor shall have the right and responsibility to assist the
Trust with respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Depositor in furtherance of the following prior to the date
of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) the preparation and filing by the Trust with the
Commission and the execution on behalf of the Trust of a registration
statement on the appropriate form in relation to the Preferred
Securities, including any amendments thereto;
(ii) 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 or on behalf of the Trust,
and the advice to the Trustees of actions they must take on behalf of
the Trust, and the preparation for execution and filing of any
documents to be executed and filed by the Trust or on behalf of the
Trust, as the Depositor deems necessary or advisable in order to comply
with the applicable laws of any such states;
(iii) the preparation for filing by the Trust and execution on
behalf of the Trust of an application to the New York Stock Exchange or
any other national stock exchange or the Nasdaq National Market for
listing upon notice of issuance of any Preferred Securities;
(iv) the preparation for 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
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the registration of the Preferred Securities under Section 12(b) or
12(g) of the Exchange Act, including any amendments thereto;
(v) the negotiation of the terms of, and the execution and
delivery of, the Underwriting Agreement providing for the sale of the
Preferred Securities; and
(vi) the taking of any other actions necessary or desirable to
carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the
Administrative Trustees are authorized and directed to conduct the affairs of
the Trust and to operate the Trust so that the Trust will not be deemed to be an
"investment company" required to be registered under the 1940 Act, or fail to be
classified as a grantor trust for U.S. Federal income tax purposes and so that
the Subordinated Debt Securities will be treated as indebtedness of the
Depositor for U.S. Federal income tax purposes. In this connection, the
Depositor and the Administrative Trustees are authorized to take any action, not
inconsistent with applicable law, the Certificate of Trust or this Trust
Agreement, that each of the Depositor and any Administrative Trustee determines
in its discretion to be necessary or desirable for such purposes, as long as
such action does not adversely affect in any material respect the interests of
the Holders of the Preferred Securities.
SECTION 2.8 Assets of Trust.
The assets of the Trust shall consist of the Trust Property.
SECTION 2.9 Title to Trust Property.
Legal title to all Trust Property shall be vested at all times
in the Property Trustee (in its capacity as such) and shall be held and
administered by the Property Trustee for the benefit of the Trust and the
Holders in accordance with this Trust Agreement.
ARTICLE III.
PAYMENT ACCOUNT
SECTION 3.1 Payment Account.
(a) On or prior to the Closing Date, the Property Trustee
shall establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making deposits in and
withdrawals from the Payment Account in accordance with this Trust Agreement.
All monies and other property deposited or held from time to time in the Payment
Account shall be held by the Property Trustee in the Payment Account for the
exclusive benefit of the Holders and for distribution as herein provided,
including (and subject to) any priority of payments provided for herein.
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(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal of or interest on, and any
other payments or proceeds with respect to, the Subordinated Debt Securities.
Amounts held in the Payment Account shall not be invested by the Property
Trustee pending distribution thereof.
ARTICLE IV.
DISTRIBUTIONS; REDEMPTION
SECTION 4.1 Distributions.
(a) The Trust Securities represent undivided beneficial
interests in the Trust Property, and Distributions (including of Additional
Amounts) will be made on the Trust Securities at the rate and on the dates that
payments of interest (including of Defaulted Interest, as defined in the
Indenture) are made on the Subordinated Debt Securities.
Accordingly:
(i) Distributions on the Trust Securities shall be cumulative,
and will accumulate whether or not there are funds of the Trust
available for the payment of Distributions. Distributions shall accrue
from --------------, 19--, and, except in the event (and to the extent)
that the Depositor exercises its right, if any, to defer the payment of
interest on the Subordinated Debt Securities pursuant to the Indenture,
shall be payable [quarterly] [semi-annually] in arrears on
-----------------------------------of each year, commencing on
--------- --, ----. If any date on which a Distribution is otherwise
payable on the Trust Securities is not a Business Day, then the payment
of such Distribution shall 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, payment of such Distribution shall be made on
the immediately preceding Business Day, in each case with the same
force and effect as if made on such date (each date on which
distributions are payable in accordance with this Section 4.1(a), a
"Distribution Date").
(ii) Assuming payments of interest on the Subordinated Debt
Securities are made when due (and before giving effect to Additional
Amounts, if applicable), Distributions on the Trust Securities shall be
payable at a rate of ----% per annum of the Liquidation Amount of the
Trust Securities. The amount of Distributions for any period less than
a full period shall be computed on the basis of a 360-day year of
twelve 30-day months. Distributions payable for each full Distribution
period will be computed by dividing the rate per annum by [four] [two].
The amount of Distributions payable for any period shall include the
Additional Amounts, if any.
(iii) Distributions on the Trust Securities shall be made by
the Property Trustee from the Payment Account and shall be payable on
each Distribution Date
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only to the extent that the Trust has funds then on hand and available
in the Payment Account for the payment of such Distributions.
(b) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Trust Securities at the close of business on the
relevant record date, which shall be the ---------- next preceding the relevant
Distribution Date; provided, however, that in the event that the Preferred
Securities do not remain in book-entry-only form, the relevant record date shall
be the ----------- next preceding the relevant Distribution Date.
SECTION 4.2 Redemption.
(a) On each Subordinated Debt Security Redemption Date and on
the stated maturity of the Subordinated Debt Securities, the Trust will be
required to redeem a Like Amount of Trust Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property
Trustee by first-class mail, postage prepaid, mailed not less than 30 nor more
than 60 days prior to the Redemption Date to each Holder of Trust Securities to
be redeemed, at such Holder's address appearing in the Security Register. All
notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price, or if the Redemption Price cannot
be calculated prior to the time the notice is required to be sent, the
estimate of the Redemption Price provided pursuant to the Indenture
together with a statement that it is an estimate and that the actual
Redemption Price will be calculated on the third Business Day prior to
the Redemption Date (and if an estimate is provided, a further notice
shall be sent of the actual Redemption Price on the date that notice of
such actual Redemption Price is received pursuant to the Indenture);
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities are to
be redeemed, the identification and the total Liquidation Amount of the
particular Trust Securities to be redeemed;
(v) that on the Redemption Date the Redemption Price will
become due and payable upon each such Trust Security to be redeemed and
that Distributions thereon will cease to accumulate on and after said
date, except as provided in Section 4.2(d) below; and
(vi) the place or places where the Trust Securities are to be
surrendered for the payment of the Redemption Price.
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(c) The Trust Securities redeemed on each Redemption Date
shall be redeemed at the Redemption Price with the proceeds from the
contemporaneous redemption of Subordinated Debt Securities. Redemptions of the
Trust Securities shall be made and the Redemption Price shall be payable on each
Redemption Date only to the extent that the Trust has funds then on hand and
available in the Payment Account for the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in
respect of any Preferred Securities, then, by 12:00 noon, New York City time, on
the Redemption Date, subject to Section 4.2(c), the Property Trustee will, with
respect to Book-Entry Preferred Securities, irrevocably deposit with the
Clearing Agency for such Book-Entry Preferred Securities funds sufficient to pay
the applicable Redemption Price and will give such Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the Holders thereof.
With respect to Preferred Securities that are not Book Entry Preferred
Securities, the Property Trustee, subject to Section 4.2(c), will irrevocably
deposit with the Paying Agent funds sufficient to pay the applicable Redemption
Price and will give the Paying Agent irrevocable instructions and authority to
pay the Redemption Price to the Holders thereof upon surrender of their
Preferred Securities Certificates. Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date for any Trust Securities called for
redemption shall be payable to the Holders of such Trust Securities as they
appear on the Securities Register for the Trust Securities on the relevant
record dates for the related Distribution Dates. If notice of redemption shall
have been given and funds deposited as required, then upon the date of such
deposit, all rights of Holders holding Trust Securities so called for redemption
will cease, except the right of such Holders to receive the Redemption Price and
any Distribution payable on or prior to the Redemption Date, but without
interest, and such Securities will cease to be outstanding. In the event that
any date on which any Redemption Price is payable 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. In the event that payment of the Redemption Price in respect of any Trust
Securities called for redemption is improperly withheld or refused and not paid
either by the Trust or by the Depositor pursuant to the Guarantee, Distributions
on such Trust Securities will continue to accumulate, at the then applicable
rate, from the Redemption Date originally established by the Trust for such
Trust Securities to the date such Redemption Price is actually paid, in which
case the actual payment date will be the date fixed for redemption for purposes
of calculating the Redemption Price.
(e) Subject to Section 4.4(a), if less than all the
Outstanding Trust Securities are to be redeemed on a Redemption Date, then the
aggregate Liquidation Amount of Trust Securities to be redeemed shall be
allocated on a pro rata basis (based on Liquidation Amounts) among the Common
Securities and the Preferred Securities. The particular Preferred Securities to
be redeemed shall be selected on a pro rata basis (based upon Liquidation
Amounts) not more than 60 days prior to the Redemption Date by the
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Property Trustee from the Outstanding Preferred Securities not previously called
for redemption, by such method (including, without limitation, by lot) as the
Property Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions of Preferred Securities, or with respect to
Book-Entry Preferred Securities, in accordance with the Clearing Agency's
customary procedures. The Property Trustee shall promptly notify the Security
Registrar in writing of the Preferred Securities selected for redemption and, in
the case of any Preferred Securities selected for partial redemption, the
Liquidation Amount thereof to be redeemed. In the event that less than all of
the Preferred Securities (other than Book-Entry Preferred Securities)
represented by a Preferred Securities Certificate are to be redeemed, upon
surrender of such Preferred Securities Certificate the Administrative Trustee,
or any one of them, shall execute and deliver to the Paying Agent, for further
delivery to the Holder of such Preferred Securities without service charge, a
new Preferred Securities Certificate representing the unredeemed Preferred
Securities evidenced by the Preferred Securities Certificate so surrendered. For
all purposes of this Trust Agreement, unless the context otherwise requires, all
provisions relating to the redemption of Preferred Securities shall relate, in
the case of any Preferred Securities redeemed or to be redeemed only in part, to
the portion of the Liquidation Amount of Preferred Securities that has been or
is to be redeemed.
SECTION 4.3 [Repayment at Option of Holders.
(a) Each Holder of Trust Securities, including the Collateral
Agent, shall have the right to require the Trust to repay all or a portion of
the Trust Securities owned by or pledged with such Holder (the "Put Option") on
the Business Day immediately preceding the Purchase Contract Settlement Date
(the "Put Option Exercise Date") at a repayment price of $----- per Trust
Security plus an amount equal to accrued Distributions thereon to the date of
payment [plus -- insert applicable repayment premium, if any] (the "Put Option
Repayment Price").
(b) The Trust will obtain funds to pay the Put Option
Repayment Price of Trust Securities being repaid under the Put Option by
presenting to the Depositor, pursuant to the Trust's right under the
Subordinated Debt Securities to require the Depositor to repay all or a portion
of the Subordinated Debt Securities on the Put Option Exercise Date,
Subordinated Debt Securities in an aggregate principal amount equal to the
aggregate stated Liquidation Amount of such Trust Securities for repayment on
the Put Option Exercise Date at the Subordinated Debt Security Repayment Price
(as defined in the Subordinated Debt Securities).
(c) In order for the Trust Securities to be repaid on the Put
Option Exercise Date, the Trust must receive at the Corporate Trust Office of
the Property Trustee, either (i) not less than 10 or more than 30 days prior to
the Put Option Exercise Date, the Trust Securities to be repaid with the form
entitled "Option to Elect Repayment" on the reverse thereof or otherwise
accompanying such Trust Security duly completed. Any such notice received by the
Trust shall be irrevocable. All questions as to the validity, eligibility
(including time of receipt) and acceptance of the Trust Securities for repayment
shall be
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determined by the Trust, whose determination shall be final and binding.
Notwithstanding the foregoing, so long as the Holder is the Collateral Agent,
such notice to elect repayment may be delivered to the Trust at any time prior
to ------- a.m., New York City time, on the Put Option Exercise Date and in the
form and manner as may be designated by the Collateral Agent.
(d) Payment of the Put Option Repayment Price to Holders of
Trust Securities shall be made at the Corporate Trust Office of the Property
Trustee, provided that the Depositor has paid the Property Trustee a sufficient
amount of cash in connection with the related repayment of the Subordinated Debt
Security. Notwithstanding the foregoing, so long as the Holder of any Trust
Securities is the Collateral Agent, the payment of the Put Option Repayment
Price in respect of such Trust Securities held by the Collateral Agent shall be
made no later than 1:00 p.m., New York City time, on the Put Option Exercise
Date by check or wire transfer in immediately available funds at such place and
to such account as may be designated by the Collateral Agent. If the Property
Trustee holds immediately available funds sufficient to pay the Put Option
Repayment Price of such Trust Securities, then, immediately prior to the close
of business on the Put Option Exercise Date, such Trust Securities will cease to
be outstanding and distributions thereon will cease to accrue, whether or not
Trust Securities are delivered to the Property Trustee, and all other rights of
the Holder in respect of the Trust Securities, including the Holder's right to
require the Trust to repay such Trust Securities, shall terminate and lapse
(other than the right to receive the Put Option Repayment Price but without
interest on such Put Option Repayment Price). Neither the Regular Trustees nor
the Trust shall be required to register or cause to be registered the transfer
of any Trust Securities for which repayment has been elected. If payment of the
Put Option Repayment Price in respect of Trust Securities is (i) improperly
withheld or refused and not paid either by the Property Trustee or by the
Depositor as guarantor pursuant to the Guarantee, or (ii) not paid by the
Property Trustee as the result of an Event of Default with respect to the
Subordinated Debt Securities presented for repayment as described in Section
4.3(b), Distributions on such Trust Securities will continue to accrue, from the
original Put Option Exercise Date to the actual date of payment, in which case
the actual payment date will be considered the Put Option Exercise Date for
purposes of calculating the Put Option Repayment Price.]
SECTION 4.4 Subordination of Common Securities.
(a) Payment of Distributions (including Additional Amounts, if
applicable) on, and the Redemption Price of, the Trust Securities, as
applicable, shall be made, subject to Section 4.2(e), pro rata among the Common
Securities and the Preferred Securities based on the Liquidation Amount of such
Common Securities and Capital Securities; provided, however, that if on any
Distribution Date or Redemption Date any Event of Default resulting from an
Indenture Event of Default shall have occurred and be continuing, no payment of
any Distribution (including Additional Amounts, if applicable) on, or Redemption
Price of, any Common Security, and no other payment on account of the
redemption, liquidation or other acquisition of Common Securities, shall be made
unless payment in full in cash of all accumulated and unpaid Distributions
(including Additional Amounts, if applicable) on all
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Outstanding Preferred Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all Outstanding Preferred Securities, shall have
been made or provided for, and all funds available to the Property Trustee shall
first be applied to the payment in full in cash of all Distributions (including
Additional Amounts, if applicable) on, or the Redemption Price of, Preferred
Securities then due and payable.
(b) In the case of the occurrence of any Event of Default
resulting from any Indenture Event of Default, the Holder of Common Securities
will be deemed to have waived any right to act with respect to any such Event of
Default under this Trust Agreement until the effect of all such Events of
Default with respect to the Preferred Securities have been cured, waived or
otherwise eliminated. Until any such Event of Default under this Trust Agreement
with respect to the Preferred Securities has been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the Holders of
the Preferred Securities and not the Holder of the Common Securities, and only
the Holders of the Preferred Securities will have the right to direct the
Property Trustee to act on their behalf.
SECTION 4.5 Payment Procedures.
Payments of Distributions (including Additional Amounts, if
applicable) in respect of the Preferred Securities shall be made by wire
transfer, at the option of the relevant Trustee, or otherwise by check mailed to
the address of the Person entitled thereto as such address shall appear on the
Securities Register, except if the Preferred Securities are held by a Clearing
Agency, such Distributions shall be made to the Clearing Agency in immediately
available funds, which shall credit the relevant Persons' accounts at such
Clearing Agency on the applicable Distribution Dates. Payments in respect of the
Common Securities shall be made in such manner as shall be mutually agreed
between the Property Trustee and the Holder of the Common Securities.
SECTION 4.6 Tax Returns and Reports.
The Administrative Trustees shall prepare (or cause to be
prepared), at the Depositor's expense, and file all U.S. Federal, state and
local tax and information returns and reports required to be filed by or in
respect of the Trust. In this regard, the Administrative Trustees shall (a)
prepare and file (or cause to be prepared and filed) the appropriate Internal
Revenue Service Form required to be filed in respect of the Trust in each
taxable year of the Trust and (b) prepare and furnish (or cause to be prepared
and furnished) to each Holder the appropriate Internal Revenue Service form
required to be provided on such form. The Administrative Trustees shall provide
the Depositor and the Property Trustee with a copy of all such returns and
reports promptly after such filing or furnishing. The Trustees shall comply with
United States Federal withholding and backup withholding tax laws and
information reporting requirements with respect to any payments to Holders under
the Trust Securities.
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On or before December 15 of each year during which any Trust
Securities are Outstanding, the Administrative Trustees shall furnish to the
Property Trustee such information as may be reasonably requested by the Property
Trustee in order that the Property Trustee may prepare the information which it
is required to report for such year on Internal Revenue Service Forms 1096 and
1099 pursuant to Section 6049 of the Code. Such information shall include the
amount of original issue discount includable in income for each outstanding
Trust Security during such year.
SECTION 4.7 Payment of Taxes, Duties, Etc. of the Trust.
Upon receipt under the Subordinated Debt Securities of
additional amounts distributed with respect to such securities as a result of
the imposition of additional taxes on the Trust, the Property Trustee shall
promptly pay any taxes, duties or governmental charges of whatsoever nature
(other than withholding taxes) imposed on the Trust by the United States or any
other taxing authority.
SECTION 4.8 Payments under Indenture or Pursuant to Direct
Actions.
Any amount payable hereunder to any Holder of Preferred
Securities shall be reduced by the amount of any corresponding payment such
Holder or an Owner with respect to the Holder's Preferred Securities has
directly received pursuant to Section 5.8 of the Indenture or Section 5.14(c) of
this Trust Agreement.
ARTICLE V.
TRUST SECURITIES CERTIFICATES
SECTION 5.1 Initial Ownership.
Upon the formation of the Trust and the contribution by the
Depositor pursuant to Section 2.3 and until the issuance of the Trust
Securities, and at any time during which no Trust Securities are outstanding,
the Depositor shall be the sole beneficial owner of the Trust.
SECTION 5.2 The Trust Securities Certificates.
The Preferred Securities Certificates shall be issued in
minimum denominations of $-- Liquidation Amount and integral multiples of $-- in
excess thereof, and the Common Securities Certificates shall be issued in
denominations of $-- Liquidation Amount and integral multiples thereof. The
Trust Securities Certificates shall be executed on behalf of the Trust by manual
signature of at least one Administrative Trustee. Trust Securities Certificates
bearing the manual signatures of individuals who were, at the time when such
signatures shall have been affixed, authorized to sign on behalf of the Trust,
shall be validly issued and entitled to the benefits of this Trust Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so
authorized prior to the delivery of
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such Trust Securities Certificates or did not hold such offices at the date of
delivery of such Trust Securities Certificates. A transferee of a Trust
Securities Certificate shall become a Holder, and shall be entitled to the
rights and subject to the obligations of a Holder hereunder, upon due
registration of such Trust Securities Certificate in such transferee's name
pursuant to Section 5.4.
SECTION 5.3 Execution and Delivery of Trust Securities
Certificates.
At each Time of Delivery, the Administrative Trustees shall
cause Trust Securities Certificates, in an aggregate Liquidation Amount as
provided in Sections 2.4 and 2.5, to be executed on behalf of the Trust and
delivered to or upon the written order of the Depositor, signed by its chairman
of the board, its president, any executive vice president or any vice president,
treasurer or assistant treasurer or controller without further corporate action
by the Depositor, in authorized denominations.
SECTION 5.4 Registration of Transfer and Exchange of Preferred
Securities Certificates.
The Depositor shall keep or cause to be kept, at the office or
agency maintained pursuant to Section 5.8, a register or registers for the
purpose of registering Trust Securities Certificates and transfers and exchanges
of Preferred Securities Certificates (the "Securities Register") in which, the
registrar designated by the Depositor (the "Securities Registrar"), subject to
such reasonable regulations as it may prescribe, shall provide for the
registration of Preferred Securities Certificates and Common Securities
Certificates (subject to Section 5.10 in the case of the Common Securities
Certificates) and registration of transfers and exchanges of Preferred
Securities Certificates as herein provided. The Bank shall be the initial
Securities Registrar.
Upon surrender for registration of transfer of any Preferred
Securities Certificate at the office or agency maintained pursuant to Section
5.8, the Administrative Trustees or any one of them shall execute and deliver,
in the name of the designated transferee or transferees, one or more new
Preferred Securities Certificates in authorized denominations of a like
aggregate Liquidation Amount dated the date of execution by such Administrative
Trustee or Trustees.
The Securities Registrar shall not be required to register the
transfer of any Preferred Securities that have been called for redemption. At
the option of a Holder, Preferred Securities Certificates may be exchanged for
other Preferred Securities Certificates in authorized denominations of the same
class and of a like aggregate Liquidation Amount upon surrender of the Preferred
Securities Certificates to be exchanged at the office or agency maintained
pursuant to Section 5.8.
Every Preferred Securities Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to an Administrative Trustee
and the Securities Registrar duly executed by the
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Holder or his attorney duly authorized in writing. Each Preferred Securities
Certificate surrendered for registration of transfer or exchange shall be
canceled and subsequently disposed of by an Administrative Trustee in accordance
with such Person's customary practice.
No service charge shall be made for any registration of
transfer or exchange of Preferred Securities Certificates, but the Securities
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Preferred Securities Certificates.
SECTION 5.5 Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates.
If (a) any mutilated Trust Securities Certificate shall be
surrendered to the Securities Registrar, or if the Securities Registrar shall
receive evidence to its satisfaction of the destruction, loss or theft of any
Trust Securities Certificate and (b) there shall be delivered to the Securities
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees, or any one of them, on behalf of the
Trust shall execute and make available for delivery, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a
new Trust Securities Certificate of like class, tenor and denomination. In
connection with the issuance of any new Trust Securities Certificate under this
Section, the Administrative Trustees or the Securities Registrar 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 Trust Securities
Certificate issued pursuant to this Section shall constitute conclusive evidence
of an undivided beneficial interest in the assets of the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
SECTION 5.6 Persons Deemed Holders.
The Trustees or the Securities Registrar shall treat the
Person in whose name any Trust Securities Certificate shall be registered in the
Securities Register as the owner of such Trust Securities Certificate for the
purpose of receiving Distributions and for all other purposes whatsoever, and
neither the Trustees nor the Securities Registrar shall be bound by any notice
to the contrary.
SECTION 5.7 Access to List of Holders' Names and Addresses.
Each Holder and each Owner shall be deemed to have agreed not
to hold the Depositor, the Property Trustee or the Administrative Trustees
accountable by reason of the disclosure of its name and address, regardless of
the source from which such information was derived.
SECTION 5.8 Maintenance of Office or Agency.
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The Administrative Trustees shall maintain an office or
offices or agency or agencies where Preferred Securities Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Trustees in respect of the Trust Securities Certificates
may be served. The Administrative Trustees initially designate Willamette
Industries, Inc., 1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201,
Attn: G. W. Hawley as its principal corporate trust office for such purposes.
The Administrative Trustees shall give prompt written notice to the Depositor
and to the Holders of any change in the location of the Securities Register or
any such office or agency.
SECTION 5.9 Appointment of Paying Agent.
The Paying Agent shall make distributions to Holders from the
Payment Account and shall report the amounts of such distributions to the
Property Trustee and the Administrative Trustees. Any Paying Agent shall have
the revocable power to withdraw funds from the Payment Account for the purpose
of making the distributions referred to above. The Administrative Trustees may
revoke such power and remove the Paying Agent if such Trustees determine in
their sole discretion that the Paying Agent shall have failed to perform its
obligations under this Trust Agreement in any material respect. The Paying Agent
shall initially be the Bank, and any co-paying agent chosen by the Bank, and
reasonably acceptable to the Administrative Trustees and the Depositor. Any
Person acting as Paying Agent shall be permitted to resign as Paying Agent upon
30 days' written notice to the Administrative Trustees, the Property Trustee and
the Depositor. In the event that the Bank shall no longer be the Paying Agent or
a successor Paying Agent shall resign or its authority to act be revoked, the
Administrative Trustees shall appoint a successor that is reasonably acceptable
to the Property Trustee and the Depositor to act as Paying Agent (which shall be
a bank or trust company). The Administrative Trustees shall cause such successor
Paying Agent or any additional Paying Agent appointed by the Administrative
Trustees to execute and deliver to the Trustees an instrument in which such
successor Paying Agent or additional Paying Agent shall agree with the Trustees
that as Paying Agent, such successor Paying Agent or additional Paying Agent
will hold all sums, if any, held by it for payment to the Holders in trust for
the benefit of the Holders entitled thereto until such sums shall be paid to
such Holders. The Paying Agent shall return all unclaimed funds to the Property
Trustee and upon removal of a Paying Agent such Paying Agent shall also return
all funds in its possession to the Property Trustee. The provisions of Sections
8.1, 8.3 and 8.6 herein shall apply to the Bank also in its role as Paying
Agent, for so long as the Bank shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in this
Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
SECTION 5.10 Ownership of Common Securities by Depositor.
At each Time of Delivery, the Depositor shall acquire and
retain beneficial and record ownership of the Common Securities. To the fullest
extent permitted by law, other than a transfer in connection with a
consolidation or merger of the Depositor into another corporation, or any
conveyance, transfer or lease by the Depositor of its properties and assets
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substantially as an entirety to any Person, pursuant to Section 8.1 of the
Indenture, any attempted transfer of the Common Securities shall be void. The
Administrative Trustees shall cause each Common Securities Certificate issued to
the Depositor to contain a legend stating "THIS CERTIFICATE IS NOT
TRANSFERABLE."
SECTION 5.11 Book-Entry Preferred Securities Certificates; Common
Securities Certificate.
(a) The Preferred Securities Certificates, upon original
issuance, may be issued in the form of Definitive Preferred Securities
Certificates in fully registered form or in the form of a typewritten Preferred
Securities Certificate or Certificates representing Book-Entry Preferred
Securities Certificates, to be delivered to The Depository Trust Company, the
initial Clearing Agency, by, or on behalf of, the Trust. Such Book-Entry
Preferred Securities Certificate or Certificates shall initially be registered
on the Securities Register in the name of Cede & Co., the nominee of the initial
Clearing Agency, and no Owner will receive a Definitive Preferred Securities
Certificate representing such Owner's interest in such Preferred Securities,
except as provided in Section 5.13. Unless and until Definitive Preferred
Securities Certificates have been issued to Owners pursuant to Section 5.13:
(i) the provisions of this Section 5.11(a) shall be in full
force and effect;
(ii) the Securities Registrar and the Trustees shall be
entitled to deal with the Clearing Agency for all purposes of this
Trust Agreement relating to the Book-Entry Preferred Securities
Certificates (including the payment of the Liquidation Amount of and
Distributions on the Preferred Securities evidenced by Book-Entry
Preferred Securities Certificates and the giving of instructions or
directions to Owners of Preferred Securities evidenced by Book-Entry
Preferred Securities Certificates) as the sole Holder of Preferred
Securities evidenced by Book-Entry Preferred Securities Certificates
and shall have no obligations to the Owners thereof;
(iii) to the extent that the provisions of this Section 5.11
conflict with any other provisions of this Trust Agreement, the
provisions of this Section 5.11 shall control; and
(iv) the rights of the Owners of the Book-Entry Preferred
Securities Certificates shall be exercised only through the Clearing
Agency and shall be limited to those established by law and agreements
between such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Certificate Depository Agreement, unless
and until Definitive Preferred Securities Certificates are issued
pursuant to Section 5.13, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive
and transmit payments on the Preferred Securities to such Clearing
Agency Participants.
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(b) A single Common Securities Certificate representing the
Common Securities shall be issued to the Depositor in the form of a definitive
Common Securities Certificate.
SECTION 5.12 Notices to Clearing Agency.
To the extent that a notice or other communication to the
Owners is required under this Trust Agreement, unless and until Definitive
Preferred Securities Certificates shall have been issued to Owners, the Trustees
shall give all such notices and communications specified herein to be given to
Owners to the Clearing Agency, and shall have no obligations to the Owners.
SECTION 5.13 Definitive Preferred Securities Certificates.
If (a) the Depositor advises the Trustees in writing that the
Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Preferred Securities Certificates, and the
Depositor is unable to locate a qualified successor, (b) the Depositor at its
option advises the Trustees in writing that it elects to terminate the
book-entry system through the Clearing Agency or (c) after the occurrence of an
Indenture Event of Default, Owners of Preferred Securities Certificates
representing beneficial interests aggregating at least a majority of the
Liquidation Amount advise the Administrative Trustees in writing that the
continuation of a book-entry system through the Clearing Agency is no longer in
the best interest of the Owners of Preferred Securities Certificates, then the
Administrative Trustee shall notify the Clearing Agency and the Clearing Agency
shall notify all Owners of Preferred Securities Certificates and the other
Trustees of the occurrence of any such event and of the availability of the
Definitive Preferred Securities Certificates to Owners of such class or classes,
as applicable, requesting the same. Upon surrender to the Administrative
Trustees of the typewritten Preferred Securities Certificate or Certificates
representing the Book-Entry Preferred Securities Certificates by the Clearing
Agency, accompanied by registration instructions, the Administrative Trustees,
or any one of them, shall execute the Definitive Preferred Securities
Certificates in accordance with the instructions of the Clearing Agency. Neither
the Securities Registrar nor the Trustees shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Preferred Securities Certificates, the Trustees shall recognize the Holders of
the Definitive Preferred Securities Certificates as Holders. The Definitive
Preferred Securities Certificates shall be printed, lithographed or engraved or
may be produced in any other manner as is reasonably acceptable to the
Administrative Trustees, as evidenced by the execution thereof by the
Administrative Trustees or any one of them.
SECTION 5.14 Rights of Holders.
(a) The legal title to the Trust Property is vested
exclusively in the Property Trustee (in its capacity as such) in accordance with
Section 2.9, and the Holders shall not have any right or title therein other
than the undivided beneficial interest in the
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assets of the Trust conferred by their Trust Securities and they shall have no
right to call for any partition or division of property, profits or rights of
the Trust except as described below. The Trust Securities shall be personal
property giving only the rights specifically set forth therein and in this Trust
Agreement. The Trust Securities shall have no preemptive or similar rights and
when issued and delivered to Holders against payment of the purchase price
therefor will be fully paid and nonassessable by the Trust. The Holders of the
Trust Securities, in their capacities as such, 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.
(b) For so long as any Preferred Securities remain
Outstanding, if, upon an Indenture Event of Default, the Indenture Trustee fails
or the holders of not less than 25% in principal amount of the outstanding
Subordinated Debt Securities fail to declare the principal of all of the
Subordinated Debt Securities to be immediately due and payable, the Holders of
at least 25% in Liquidation Amount of the Preferred Securities then Outstanding
shall have such right by a notice in writing to the Depositor and the Indenture
Trustee; and upon any such declaration such principal amount of and the accrued
interest on all of the Subordinated Debt Securities shall become immediately due
and payable, provided that the payment of principal and interest on such
Subordinated Debt Securities shall remain subordinated to the extent provided in
the Indenture.
At any time after such a declaration of acceleration with
respect to the Subordinated Debt Securities has been made and before a judgment
or decree for payment of the money due has been obtained by the Indenture
Trustee as in the Indenture provided, the Holders of a majority (based on
Liquidation Amounts) of the Outstanding Preferred Securities, by written notice
to the Property Trustee, the Depositor and the Indenture Trustee, may rescind
and annul such declaration and its consequences if:
(i) the Depositor has paid or deposited with the Indenture
Trustee a sum sufficient to pay
(A) all overdue installments of interest (including
any Defaulted Interest (as defined in the Indenture)) on all
of the Subordinated Debt Securities,
(B) the principal of (and premium, if any, on) any
Subordinated Debt Securities which have become due otherwise
than by such declaration of acceleration and interest thereon
at the rate borne by the Subordinated Debt Securities, and
(C) all sums paid or advanced by the Indenture
Trustee under the Indenture and the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee
and the Property Trustee, their agents and counsel; and
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(ii) all Events of Default with respect to the Subordinated
Debt Securities, other than the non-payment of the principal
of the Subordinated Debt Securities which has become due
solely by such acceleration, have been cured or waived as
provided in Section 5.13 of the Indenture.
The Holders of a majority (based on Liquidation Amounts) of
the Outstanding Preferred Securities may, on behalf of the Holders of all the
Preferred Securities, waive any past default under the Indenture, except a
default in the payment of principal or interest (unless such default has been
cured and a sum sufficient to pay all matured installments of interest and
principal due otherwise than by acceleration has been deposited with the
Indenture Trustee) or a default in respect of a covenant or provision which
under the Indenture cannot be modified or amended without the consent of the
holder of each outstanding Subordinate Debt Security. No such rescission shall
affect any subsequent default or impair any right consequent thereon.
Upon receipt by the Property Trustee of written notice
declaring such an acceleration, or rescission and annulment thereof, by Holders
of the Preferred Securities all or part of which is represented by Book-Entry
Preferred Securities Certificates, a record date shall be established for
determining Holders of Outstanding Preferred Securities entitled to join in such
notice, which record date shall be at the close of business on the day the
Property Trustee receives such notice. The Holders on such record date, or their
duly designated proxies, and only such Persons, shall be entitled to join in
such notice, whether or not such Holders remain Holders after such record date;
provided, that, unless such declaration of acceleration, or rescission and
annulment, as the case may be, shall have become effective by virtue of the
requisite percentage having joined in such notice prior to the day which is 90
days after such record date, such notice of declaration of acceleration, or
rescission and annulment, as the case may be, shall automatically and without
further action by any Holder be canceled and of no further effect. Nothing in
this paragraph shall prevent a Holder, or a proxy of a Holder, from giving,
after expiration of such 90-day period, a new written notice of declaration of
acceleration, or rescission and annulment thereof, as the case may be, that is
identical to a written notice which has been canceled pursuant to the proviso to
the preceding sentence, in which event a new record date shall be established
pursuant to the provisions of this Section 5.14(b).
(c) For so long as any Preferred Securities remain
Outstanding, to the fullest extent permitted by law and subject to the terms of
this Trust Agreement and the Indenture, upon an Indenture Event of Default
specified in Section 5.1(1) or 5.1(2) of the Indenture, any Holder of Preferred
Securities shall have the right to institute a proceeding directly against the
Depositor, pursuant to Section 5.8 of the Indenture, for enforcement of payment
to such Holder of the principal amount of or interest on Subordinated Debt
Securities having a principal amount equal to the Liquidation Amount of the
Preferred Securities of such Holder (a "Direct Action") on or after the
respective due date specified in the applicable series of Subordinated Debt
Securities. In connection with such Direct Action, the Depositor will be
subrogated to the rights of such Holder under this Trust Agreement to the extent
of any payment made by the Depositor to such Holder in such Direct Action.
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Except as set forth in Section 5.14(b) and this Section 5.14(c), the Holders of
Preferred Securities shall have no right to exercise directly any right or
remedy available to the holders of, or in respect of, the Subordinated Debt
Securities.
ARTICLE VI.
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.1 Limitations on Voting Rights.
(a) Except as provided in this Section, in Sections 5.14, 8.10
and 10.2 and in the Indenture and as otherwise required by law, no Holder of
Preferred Securities shall have any right to vote or in any manner otherwise
control the administration, operation and management of the Trust or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Trust Securities Certificates, be construed so as
to constitute the Holders from time to time as partners or members of an
association.
(b) So long as any Subordinated Debt Securities are held by
the Property Trustee, the Trustees shall not (i) direct the time, method and
place of conducting any proceeding for any remedy available to the Indenture
Trustee, or executing any trust or power conferred on the Indenture Trustee with
respect to such Subordinated Debt Securities, (ii) waive any past default which
is waivable under Section 5.13 of the Indenture, (iii) exercise any right to
rescind or annul a declaration that the principal of all the Subordinated Debt
Securities shall be due and payable or (iv) consent to any amendment,
modification or termination of the Indenture or the Subordinated Debt
Securities, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of at least a majority (based on
Liquidation Amounts) of all Outstanding Preferred Securities, provided, however,
that where a consent under the Indenture would require the consent of each
Holder of Subordinated Debt Securities affected thereby, no such consent shall
be given by the Property Trustee without the prior written consent of each
Holder of Preferred Securities. The Trustees shall not revoke any action
previously authorized or approved by a vote of the Holders of Preferred
Securities, except by a subsequent vote of the Holders of Preferred Securities.
The Property Trustee shall notify all Holders of the Preferred Securities of any
notice of default received from the Indenture Trustee with respect to the
Subordinated Debt Securities. In addition to obtaining the foregoing approvals
of the Holders of the Preferred Securities, prior to taking any of the foregoing
actions, the Trustees shall, at the expense of the Depositor, obtain an Opinion
of Counsel experienced in such matters to the effect that such action shall not
cause the Trust to fail to be classified as a grantor trust for U.S. Federal
income tax purposes.
(c) If any proposed amendment to the Trust Agreement provides
for, or the Trustees otherwise propose to effect, (i) any action that would
adversely affect in any material respect the powers, preferences or special
rights of the Preferred Securities, whether by way of amendment to the Trust
Agreement or otherwise, or (ii) the dissolution, winding-up or termination of
the Trust, other than pursuant to the terms of this Trust
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Agreement, then the Holders of Outstanding Preferred Securities as a class will
be entitled to vote on such amendment or proposal and such amendment or proposal
shall not be effective except with the approval of the Holders of at least a
majority (based on Liquidation Amounts) of the Outstanding Preferred Securities.
Notwithstanding any other provision of this Trust Agreement, no amendment to
this Trust Agreement may be made if, as a result of such amendment, it would
cause the Trust to fail to be classified as a grantor trust for U.S.
Federal income tax purposes.
SECTION 6.2 Notice of Meetings.
Notice of all meetings of the Holders of Preferred Securities,
stating the time, place and purpose of the meeting, shall be given by the
Property Trustee pursuant to Section 10.8 to each Holder of record of a
Preferred Security, at the Holder's registered address, at least 15 days and not
more than 90 days before the meeting. At any such meeting, any business properly
before the meeting may be so considered whether or not stated in the notice of
the meeting. Any adjourned meeting may be held as adjourned without further
notice.
SECTION 6.3 Meetings of Holders of Preferred Securities.
No annual meeting of Holders is required to be held. The
Administrative Trustees, however, shall call a meeting of Holders of Preferred
Securities to vote on any matter upon the written request of the Holders of
record of 25% of the Preferred Securities (based upon Liquidation Amounts) and
the Administrative Trustees or the Property Trustee may, at any time in their
discretion, call a meeting of Holders of Preferred Securities to vote on any
matters as to which Holders of Preferred Securities are entitled to vote.
Holders of record of 50% of the Outstanding Preferred
Securities (based upon Liquidation Amounts), present in person or by proxy,
shall constitute a quorum at any meeting of Holders.
If a quorum is present at a meeting, an affirmative vote by
the Holders of record of Preferred Securities present, in person or by proxy,
holding more than a majority of the Preferred Securities (based upon Liquidation
Amounts) held by the Holders of record of Preferred Securities present, either
in person or by proxy, at such meeting shall constitute the action of the
Holders of Preferred Securities, unless this Trust Agreement requires a greater
number of affirmative votes.
SECTION 6.4 Voting Rights.
Holders shall be entitled to one vote for each $----- of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Holders are entitled to vote.
SECTION 6.5 Proxies, etc.
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At any meeting of Holders, any Holder entitled to vote thereat
may vote by proxy, provided that no proxy shall be voted at any meeting unless
it shall have been placed on file with the Administrative Trustees, or with such
other officer or agent of the Trust as the Administrative Trustees may direct,
for verification prior to the time at which such vote shall be taken. Pursuant
to a resolution of the Property Trustee, proxies may be solicited in the name of
the Property Trustee or one or more officers of the Property Trustee. Only
Holders of record shall be entitled to vote. When Trust Securities are held
jointly by several persons, any one of them may vote at any meeting in person or
by proxy in respect of such Trust Securities, but if more than one of them shall
be present at such meeting in person or by proxy, and such joint owners or their
proxies so present disagree as to any vote to be cast, such vote shall not be
received in respect of such Trust Securities. A proxy purporting to be executed
by or on behalf of a Holder shall be deemed valid unless challenged at or prior
to its exercise, and the burden of proving invalidity shall rest on the
challenger. No proxy shall be valid more than three years after its date of
execution.
SECTION 6.6 Holder Action by Written Consent.
Any action which may be taken by Holders at a meeting may be
taken without a meeting if Holders holding more than a majority of all
Outstanding Trust Securities (based upon Liquidation Amounts) entitled to vote
in respect of such action (or such larger proportion thereof as shall be
required by any express provision of this Trust Agreement) shall consent to the
action in writing.
SECTION 6.7 Record Date for Voting and Other Purposes.
For the purposes of determining the Holders who are entitled
to notice of and to vote at any meeting or by written consent, or to participate
in any distribution on the Trust Securities in respect of which a record date is
not otherwise provided for in this Trust Agreement, or for the purpose of any
other action, the Administrative Trustees may from time to time fix a date, not
more than 90 days prior to the date of any meeting of Holders or the payment of
a distribution or other action, as the case may be, as a record date for the
determination of the identity of the Holders of record for such purposes.
SECTION 6.8 Acts of Holders.
Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Trust Agreement to
be given, made or taken by Holders or Owners may be embodied in and evidenced by
one or more instruments of substantially similar tenor signed by such Holders or
Owners in person or by an agent duly appointed in writing; and, except as
otherwise expressly provided herein, such action shall become effective when
such instrument or instruments are delivered to an Administrative Trustee. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders or Owners
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Trust Agreement and
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(subject to Section 8.1) conclusive in favor of the Trustees, if made in the
manner provided in this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.
The ownership of Preferred Securities shall be proved by the
Securities Register.
Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Trust Security shall bind
every future Holder of the same Trust Security and the Holder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Holder entitled hereunder to
take any action hereunder with regard to any particular Trust Security may do so
with regard to all or any part of the Liquidation Amount of such Trust Security
or by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such liquidation amount.
If any dispute shall arise between the Holders and the
Administrative Trustees or among such Holders or Trustees with respect to the
authenticity, validity or binding nature of any request, demand, authorization,
direction, consent, waiver or other Act of such Holder or Trustee under this
Article VI, then the determination of such matter by the Property Trustee shall
be conclusive with respect to such matter.
A Holder may institute a legal proceeding directly against the
Depositor under the Guarantee to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee (as defined
in the Guarantee), the Trust or any person or entity.
SECTION 6.9 Inspection of Records.
Upon reasonable notice to the Administrative Trustees and the
Property Trustee, the records of the Trust shall be open to inspection by
Holders during normal business hours for any purpose reasonably related to such
Holder's interest as a Holder.
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ARTICLE VII.
REPRESENTATIONS AND WARRANTIES
SECTION 7.1 Representations and Warranties of the Property
Trustee and the Delaware Trustee.
The Property Trustee and the Delaware Trustee, each severally
on behalf of and as to itself, hereby represents and warrants for the benefit of
the Depositor and the Holders that:
(a) the Property Trustee is a banking corporation, duly
organized, validly existing and in good standing under the laws of
[--------------------];
(b) the Property Trustee has full corporate power, authority
and legal right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;
(c) the Delaware Trustee is a Delaware corporation duly
organized, validly existing and in good standing in the State of Delaware;
(d) the Delaware Trustee has full corporate power, authority
and legal right to execute, deliver and perform its obligations under this Trust
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of this Trust Agreement;
(e) this Trust Agreement has been duly authorized, executed
and delivered by the Property Trustee and the Delaware Trustee and constitutes
the valid and legally binding agreement of each of the Property Trustee and the
Delaware Trustee enforceable against each of them in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
(f) the execution, delivery and performance of this Trust
Agreement has been duly authorized by all necessary corporate or other action on
the part of the Property Trustee and the Delaware Trustee and does not require
any approval of stockholders of the Property Trustee and the Delaware Trustee
and such execution, delivery and performance will not (i) violate the Charter or
By-laws of the Property Trustee or the Delaware Trustee, (ii) violate any
provision of, or constitute, with or without notice or lapse of time, a default
under, or result in the creation or imposition of, any Lien on any properties
included in the Trust Property pursuant to the provisions of, any indenture,
mortgage, credit agreement, license or other agreement or instrument to which
the Property Trustee or the Delaware Trustee is a party or by which it is bound,
or (iii) violate any law, governmental rule or regulation of the United States
or the State of Delaware, as the case may be, governing the
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banking, trust or general powers of the Property Trustee or the Delaware Trustee
(as appropriate in context) or any order, judgment or decree applicable to the
Property Trustee or the Delaware Trustee;
(g) neither the authorization, execution or delivery by the
Property Trustee or the Delaware Trustee of this Trust Agreement nor the
consummation of any of the transactions by the Property Trustee or the Delaware
Trustee (as appropriate in context) contemplated herein or therein requires the
consent or approval of, the giving of notice to, the registration with or the
taking of any other action with respect to any governmental authority or agency
under any existing Federal law governing the banking, trust or general powers of
the Property Trustee or the Delaware Trustee, as the case may be, under the laws
of the United States or the State of Delaware;
(h) there are no proceedings pending or, to the best of each
of the Property Trustee's and the Delaware Trustee's knowledge, threatened
against or affecting the Property Trustee or the Delaware Trustee in any court
or before any governmental authority, agency or arbitration board or tribunal
which, individually or in the aggregate, would materially and adversely affect
the Trust or would question the right, power and authority of the Property
Trustee or the Delaware Trustee, as the case may be, to enter into or perform
its obligations as one of the Trustees under this Trust Agreement.
SECTION 7.2 Representations and Warranties of Depositor.
The Depositor hereby represents and warrants for the benefit
of the Holders that:
(a) the Trust Securities Certificates issued at each Time of
Delivery on behalf of the Trust have been duly authorized and will have been,
duly and validly executed, issued and delivered by the Trustees pursuant to the
terms and provisions of, and in accordance with the requirements of, this Trust
Agreement and the Holders will be, as of each such date, entitled to the
benefits of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges
payable by the Trust (or the Trustees on behalf of the Trust) under the laws of
the State of Delaware or any political subdivision thereof in connection with
the execution, delivery and performance by the Property Trustee or the Delaware
Trustee, as the case may be, of this Trust Agreement.
ARTICLE VIII.
THE TRUSTEES
SECTION 8.1 Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Trustees shall be
as provided by this Trust Agreement and, in the case of the Property Trustee, by
the Trust Indenture Act.
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Notwithstanding the foregoing, no provision of this Trust Agreement shall
require the Trustees to expend or risk their own funds or otherwise incur any
financial liability in the performance of any of their duties hereunder, or in
the exercise of any of their rights or powers, if they shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Trust Agreement relating to the
conduct or affecting the liability of or affording protection to the Trustees
shall be subject to the provisions of this Section. Nothing in this Trust
Agreement shall be construed to release an Administrative Trustee from liability
for its own gross negligent action, its own gross negligent failure to act, or
its own willful misconduct. To the extent that, at law or in equity, an
Administrative Trustee has duties (including fiduciary duties) and liabilities
relating thereto to the Trust or to the Holders, such Administrative Trustee
shall not be liable to the Trust or to any Holder for such Trustee's good faith
reliance on the provisions of this Trust Agreement. The provisions of this Trust
Agreement, to the extent that they restrict the duties and liabilities of the
Administrative Trustees otherwise existing at law or in equity, are agreed by
the Depositor and the Holders to replace such other duties and liabilities of
the Administrative Trustees.
(b) All payments made by the Property Trustee or a Paying
Agent in respect of the Trust Securities shall be made only from the revenue and
proceeds from the Trust Property and only to the extent that there shall be
sufficient revenue or proceeds from the Trust Property to enable the Property
Trustee or a Paying Agent to make payments in accordance with the terms hereof.
Each Holder, by its acceptance of a Trust Security, agrees that it will look
solely to the revenue and proceeds from the Trust Property to the extent legally
available for distribution to it as herein provided and that the Trustees are
not personally liable to it for any amount distributable in respect of any Trust
Security or for any other liability in respect of any Trust Security. This
Section 8.1(b) does not limit the liability of the Trustees expressly set forth
elsewhere in this Trust Agreement or, in the case of the Property Trustee, in
the Trust Indenture Act.
(c) No provision of this Trust Agreement 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) the Property Trustee shall not be liable for any error of
judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(ii) 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 relating to the
time, method and place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any trust or power
conferred upon the Property Trustee under this Trust Agreement;
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(iii) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Subordinated
Debt Securities and the Payment Account shall be to deal with such
Property in a similar manner as the Property Trustee deals with similar
property for its own account, subject to the protections and
limitations on liability afforded to the Property Trustee under this
Trust Agreement and the Trust Indenture Act;
(iv) the Property Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree with the
Depositor; and money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the
Payment Account maintained by the Property Trustee pursuant to Section
3.1 and except to the extent otherwise required by law; and
(v) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the
Depositor with their respective duties under this Trust Agreement, nor
shall the Property Trustee be liable for the default or misconduct of
the Administrative Trustees or the Depositor.
SECTION 8.2 Certain Notices.
Within five Business Days after the occurrence of any Event of
Default actually known to the Property Trustee, the Property Trustee shall
transmit, in the manner and to the extent provided in Section 10.8, notice of
such Event of Default to the Holders, the Administrative Trustees and the
Depositor, unless such Event of Default shall have been cured or waived.
Within five Business Days after the receipt of notice of the
Depositor's exercise of its right, if any, to defer the payment of interest on
the Subordinated Debt Securities pursuant to the Indenture, the Administrative
Trustee shall transmit, in the manner and to the extent provided in Section
10.8, notice of such exercise to the Holders and the Property Trustee, unless
such exercise shall have been revoked.
SECTION 8.3 Certain Rights of Property Trustee.
Subject to the provisions of Section 8.1:
(a) the Property Trustee may rely and shall be protected in
acting or refraining from acting in good faith upon any resolution, Opinion of
Counsel, certificate, written representation of a Holder or transferee,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond, debenture,
note, other evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;
(b) if (i) in performing its duties under this Trust Agreement
the Property Trustee is required to decide between alternative courses of action
or (ii) in construing any of
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the provisions of this Trust Agreement the Property Trustee finds the same
ambiguous or inconsistent with any other provisions contained herein or (iii)
the Property Trustee is unsure of the application of any provision of this Trust
Agreement, then, except as to any matter as to which the Holders of Preferred
Securities are entitled to vote under the terms of this Trust Agreement, the
Property Trustee shall deliver a notice to the Depositor requesting written
instructions of the Depositor as to the course of action to be taken and the
Property Trustee shall take such action, or refrain from taking such action, as
the Property Trustee shall be instructed in writing to take, or to refrain from
taking, by the Depositor; provided, however, that if the Property Trustee does
not receive such instructions of the Depositor within ten Business Days after it
has delivered such notice, or such reasonably shorter period of time set forth
in such notice (which to the extent practicable shall not be less than two
Business Days), it may, but shall be under no duty to, take or refrain from
taking such action not inconsistent with this Trust Agreement as it shall deem
advisable and in the best interests of the Holders, in which event the Property
Trustee shall have no liability except for its own bad faith, negligence or
willful misconduct;
(c) any direction or act of the Depositor or the
Administrative Trustees contemplated by this Trust Agreement shall be
sufficiently evidenced by an Officers' Certificate;
(d) whenever in the administration of this Trust Agreement,
the Property Trustee shall deem it desirable that a matter be established before
undertaking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the Depositor or
the Administrative Trustees;
(e) 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
rerecording, refiling or reregistration thereof;
(f) the Property Trustee may consult with counsel (which
counsel may be counsel to the Depositor or any of its Affiliates, and may
include any of its employees) and the advice of such counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon and in
accordance with such advice, such counsel may be counsel to the Depositor 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 Trust Agreement from any court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Trust Agreement at the
request or direction of any of the Holders pursuant to this Trust Agreement,
unless such Holders shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
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(h) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other paper
or document, unless requested in writing to do so by one or more Holders, but
the Property Trustee may make such further inquiry or investigation into such
facts or matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through its agents or attorneys, provided that the Property Trustee shall be
responsible for its own negligence or recklessness with respect to selection of
any agent or attorney appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement the
Property Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder the Property
Trustee (i) may request instructions from the Holders of the 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
(k) except as otherwise expressly provided by this Trust
Agreement, the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Trust Agreement.
No provision of this Trust Agreement shall be deemed to impose
any duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
SECTION 8.4 Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Trust Securities
Certificates shall be taken as the statements of the Trust, and the Trustees do
not assume any responsibility for their correctness. The Trustees shall not be
accountable for the use or application by the Depositor of the proceeds of the
Subordinated Debt Securities.
SECTION 8.5 May Hold Securities.
Except as provided in the definition of the term "Outstanding"
in Article I, any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other
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capacity, may become the owner or pledgee of Trust Securities and, subject to
Sections 8.8 and 8.13, may otherwise deal with the Trust with the same rights it
would have if it were not a Trustee or such other agent.
SECTION 8.6 Compensation; Indemnity; Fees.
The Depositor agrees:
(a) to pay to the Trustees from time to time reasonable
compensation for all services rendered by them hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) except as otherwise expressly provided herein, to
reimburse the Trustees upon request for all reasonable expenses, disbursements
and advances incurred or made by the Trustees in accordance with any provision
of this Trust Agreement (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad faith;
and
(c) to the fullest extent permitted by applicable law, to
indemnify and hold harmless (i) each Trustee, (ii) any Affiliate of any Trustee,
(iii) any officer, director, shareholder, employee, representative or agent of
any Trustee, and (iv) any employee or agent of the Trust or its Affiliates,
(referred to herein as an "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 conferred on such Indemnified Person by this Trust 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.
The provisions of this Section 8.6 shall survive the
termination of this Trust Agreement.
No Trustee may claim any lien or charge on any Trust Property
as a result of any amount due pursuant to this Section 8.6.
The Depositor and any Trustee (subject to Section 8.8, in the
case of 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 Trust
Agreement in and to such independent ventures or the income or profits derived
therefrom, and the pursuit of any such venture, even if competitive with the
business of the Trust, shall not be deemed wrongful or improper. Neither the
Depositor, nor any Trustee,
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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 the Depositor or any 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 Trustee may engage or be interested in any financial or other
transaction with the Depositor or any Affiliate of the Depositor, or may act as
depository for, trustee or agent for, or act on any committee or body of holders
of, securities or other obligations of the Depositor or its Affiliates.
SECTION 8.7 Corporate Property Trustee Required; Eligibility of
Trustees.
(a) There shall at all times be a Property Trustee hereunder
with respect to the Trust Securities. The Property Trustee shall be a Person
that is eligible pursuant to the Trust Indenture Act to act as such and has a
combined capital and surplus of at least $50,000,000. If any such Person
publishes reports of condition at least annually, pursuant to law or to the
requirements of its supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such Person shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Property Trustee with respect to the
Trust Securities shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
(b) There shall at all times be one or more Administrative
Trustees hereunder with respect to the Trust Securities. Each Administrative
Trustee shall be either a natural person who is at least 21 years of age or a
legal entity that shall act through one or more persons authorized to bind that
entity.
(c) There shall at all times be a Delaware Trustee with
respect to the Trust Securities. The Delaware Trustee shall either be (i) a
natural person who is at least 21 years of age and a resident of the State of
Delaware or (ii) a legal entity with its principal place of business in the
State of Delaware and that otherwise meets the requirements of applicable
Delaware law that shall act through one or more persons authorized to bind such
entity.
SECTION 8.8 Conflicting Interests.
(a) If the Property Trustee has or shall acquire a conflicting
interest within the meaning of the Trust Indenture Act, the Property Trustee
shall either eliminate such interest or resign, to the extent and in the manner
provided by, and subject to the provisions of, the Trust Indenture Act and this
Trust Agreement.
(b) The Guarantee Agreement and the Indenture shall be deemed
to be specifically described in this Trust Agreement for the purposes of clause
(i) of the first provision contained in Section 310(b) of the Trust Indenture
Act.
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SECTION 8.9 Co-Trustees and Separate Trustee.
Unless an Event of Default shall have occurred and be
continuing, at any time or times, for the purpose of meeting the legal
requirements of the Trust Indenture Act or of any jurisdiction in which any part
of the Trust Property may at the time be located, the Depositor and the
Administrative Trustees, by agreed action of the majority of such Trustees,
shall have power to appoint, and upon the written request of the Administrative
Trustees, the Depositor shall for such purpose join with the Administrative
Trustees in the execution, delivery, and performance of all instruments and
agreements necessary or proper to appoint, one or more Persons approved by the
Property Trustee either to act as co-trustee, jointly with the Property Trustee,
of all or any part of such Trust Property, or to the extent required by law to
act as separate trustee of any such property, in either case with such powers as
may be provided in the instrument of appointment, and to vest in such Person or
Persons in the capacity aforesaid, any property, title, right or power deemed
necessary or desirable, subject to the other provisions of this Section. If the
Depositor does not join in such appointment within 15 days after the receipt by
it of a request so to do, or in case an Indenture Event of Default has occurred
and is continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section shall either be (i) a natural person who is at least 21 years of age and
a resident of the United States or (ii) a legal entity with its principal place
of business in the United States that shall act through one or more persons
authorized to bind such entity.
Should any written instrument from the Depositor be required
by any co-trustee or separate trustee so appointed for more fully confirming to
such co-trustee or separate trustee such property, title, right, or power, any
and all such instruments shall, on request, be executed, acknowledged and
delivered by the Depositor.
Every co-trustee or separate trustee shall, to the extent
permitted by law, but to such extent only, be appointed subject to the following
terms, namely:
(a) The Trust Securities shall be executed and delivered and
all rights, powers, duties, and obligations hereunder in respect of the custody
of securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustees specified hereunder shall be exercised
solely by such Trustees and not by such co-trustee or separate trustee.
(b) The rights, powers, duties, and obligations hereby
conferred or imposed upon the Property Trustee in respect of any property
covered by such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-trustee
or separate trustee jointly, as shall be provided in the instrument appointing
such co-trustee or separate trustee, except to the extent that under any law of
any jurisdiction in which any particular act is to be performed, the Property
Trustee shall be incompetent or unqualified to perform such act, in which event
such rights, powers, duties and obligations shall be exercised and performed by
such co-trustee or separate trustee.
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(c) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Depositor, may
accept the resignation of or remove any co-trustee or separate trustee appointed
under this Section, and, in case an Indenture Event of Default has occurred and
is continuing, the Property Trustee shall have power to accept the resignation
of, or remove, any such co-trustee or separate trustee without the concurrence
of the Depositor. Upon the written request of the Property Trustee, the
Depositor shall join with the Property Trustee in the execution, delivery and
performance of all instruments and agreements necessary or proper to effectuate
such resignation or removal. A successor to any co-trustee or separate trustee
so resigned or removed may be appointed in the manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee or
any other trustee hereunder.
(e) The Property Trustee shall not be liable by reason of any
act of a co-trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee shall
be deemed to have been delivered to each such co-trustee and separate trustee.
SECTION 8.10 Resignation and Removal; Appointment of Successor.
No resignation or removal of any Trustee (the "Relevant
Trustee") and no appointment of a successor Trustee pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Trustee in accordance with the applicable requirements of Section 8.11.
Subject to the immediately preceding paragraph, the Relevant
Trustee may resign at any time by giving written notice thereof to the Holders.
If the instrument of acceptance by the successor Trustee required by Section
8.11 shall not have been delivered to the Relevant Trustee within 30 days after
the giving of such notice of resignation, the Relevant Trustee may petition, at
the expense of the Trust, any court of competent jurisdiction for the
appointment of a successor Relevant Trustee.
Unless an Indenture Event of Default shall have occurred and
be continuing, any Trustee may be removed or replaced, and the total number of
Trustees may be increased or decreased at any time by Act of the Holder of the
Common Securities. If an Indenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority (based on
Liquidation Amounts) of the Outstanding Preferred Securities, delivered to the
Relevant Trustee (in its individual capacity and on behalf of the Trust). An
Administrative Trustee may be removed by the Holder of the Common Securities at
any time.
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If any Trustee shall resign, be removed or become incapable of
acting as Trustee, or if a vacancy shall occur in the office of any Trustee for
any cause, at a time when no Indenture Event of Default shall have occurred and
be continuing, the Holder of the Common Securities, by Act of the Holder of the
Common Securities delivered to the retiring Trustee, shall promptly appoint a
successor Trustee or Trustees, and the retiring Trustee shall comply with the
applicable requirements of Section 8.11. If the Property Trustee or the Delaware
Trustee shall resign, be removed or become incapable of continuing to act as the
Property Trustee or the Delaware Trustee, as the case may be, at a time when an
Indenture Event of Default shall have occurred and be continuing, the Holders of
Preferred Securities, by Act of the Holders of a majority (based on Liquidation
Amounts) of the Outstanding Preferred Securities delivered to the retiring
Relevant Trustee, shall promptly appoint a successor Relevant Trustee or
Trustees, and such successor Trustee shall comply with the applicable
requirements of Section 8.11. If an Administrative Trustee shall resign, be
removed or become incapable of acting as Administrative Trustee, at a time when
an Indenture Event of Default shall have occurred and be continuing, the Holder
of the Common Securities by Act of the Holder of the Common Securities delivered
to the Administrative Trustee shall promptly appoint a successor Administrative
Trustee or Administrative Trustees and such successor Administrative Trustee or
Trustees shall comply with the applicable requirements of Section 8.11. If no
successor Relevant Trustee shall have been so appointed by the Holder of the
Common Securities or the Holders of Preferred Securities and accepted
appointment in the manner required by Section 8.11, any Holder who has been a
Holder of Trust Securities for at least six months may, on behalf of such Holder
and all others similarly situated, petition any court of competent jurisdiction
for the appointment of a successor Relevant Trustee.
The Property Trustee shall give notice of each resignation and
each removal of a Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 10.8 and shall give notice to the
Depositor. Each notice shall include the name of the successor Relevant Trustee
and the address of its Corporate Trust Office if it is the Property Trustee.
Notwithstanding the foregoing or any other provision of this
Trust Agreement, in the event any Administrative Trustee or a Delaware Trustee
who is a natural person dies or becomes, in the opinion of the Depositor,
incompetent or incapacitated, the vacancy created by such death, incompetence or
incapacity may be filled by (a) the unanimous act of the remaining
Administrative Trustees if there are at least two of them or (b) otherwise by
the Depositor (with the successor in each case being a Person who satisfies the
eligibility requirement for Administrative Trustees or Delaware Trustee, as the
case may be, set forth in Section 8.7).
SECTION 8.11 Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Relevant
Trustee, the retiring Relevant Trustee and each successor Relevant Trustee with
respect to the Trust Securities shall execute and deliver an amendment hereto
wherein each successor Relevant
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Trustee shall accept such appointment and which (a) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Relevant Trustee all the rights, powers, trusts and
duties of the retiring Relevant Trustee with respect to the Trust Securities and
the Trust and (b) shall add to or change any of the provisions of this Trust
Agreement as shall be necessary to provide for or facilitate the administration
of the Trust by more than one Relevant Trustee, it being understood that nothing
herein or in such amendment shall constitute such Relevant Trustees co-trustees
and upon the execution and delivery of such amendment the resignation or removal
of the retiring Relevant Trustee shall become effective to the extent provided
therein and each such successor Relevant Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Relevant Trustee; but, on request of the Trust or any
successor Relevant Trustee such retiring Relevant Trustee shall duly assign,
transfer and deliver to such successor Relevant Trustee all Trust Property, all
proceeds thereof and money held by such retiring Relevant Trustee hereunder with
respect to the Trust Securities and the Trust.
Upon request of any such successor Relevant Trustee, the Trust
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Relevant Trustee all such rights, powers and
trusts referred to in the first or second preceding paragraph, as the case may
be.
No successor Relevant Trustee shall accept its appointment
unless at the time of such acceptance such successor Relevant Trustee shall be
qualified and eligible under this Article.
SECTION 8.12 Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Property Trustee or the
Delaware Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which such Relevant Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of such Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article and, with respect to the Delaware Trustee, the Delaware
Business Trust Act, without the execution or filing of any paper or any further
act on the part of any of the parties hereto.
SECTION 8.13 Preferential Collection of Claims Against Depositor
or Trust.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other similar judicial proceeding relative to the Trust or any other obligor
upon the Trust Securities or the property of the Trust or of such other obligor
or their creditors, the Property Trustee (irrespective of whether any
Distributions on the Trust Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the
Property Trustee shall have made any demand on the Trust for the payment of any
past due Distributions)
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shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Trust Securities and to file
such other papers or documents as may be necessary or advisable in order to have
the claims of the Property Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel) and of the Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the
Property Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement adjustment or compensation
affecting the Trust Securities or the rights of any Holder thereof or to
authorize the Property Trustee to vote in respect of the claim of any Holder in
any such proceeding.
SECTION 8.14 Reports by Property Trustee.
(a) Not later than -------- -- of each year commencing with
- ------------, 19---, the Property Trustee shall transmit to all Holders in
accordance with Section 10.8, and to the Depositor, a brief report dated as of
the immediately preceding December 31 with respect to:
(i) its eligibility under Section 8.7 or, in lieu thereof, if
to the best of its knowledge it has continued to be eligible under said
Section, a written statement to such effect;
(ii) a statement that the Property Trustee has complied with
all of its obligations under this Trust Agreement during the
twelve-month period (or, in the case of the initial report, the period
since the Closing Date) ending with such December 31 or, if the
Property Trustee has not complied in any material respect with such
obligations, a description of such noncompliance; and
(iii) any change in the property and funds in its possession
as Property Trustee since the date of its last report and any action
taken by the Property Trustee
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in the performance of its duties hereunder which it has not previously
reported and which in its opinion materially affects the Trust
Securities.
(b) In addition the Property Trustee shall transmit to Holders
such reports concerning the Property Trustee and its actions under this Trust
Agreement as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with each national
stock exchange, the Nasdaq Stock Market or such other interdealer quotation
system or self-regulatory organization upon which the Trust Securities are
listed or traded, with the Commission and with the Depositor.
SECTION 8.15 Reports to the Property Trustee.
The Depositor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such documents, reports and
information as required by Section 314 of the Trust Indenture Act (if any) and
the compliance certificate required by Section 314(a) 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 8.16 Evidence of Compliance with Conditions Precedent.
Each of the Depositor and the Administrative Trustees on
behalf of the Trust shall provide to the Property Trustee such evidence of
compliance with any conditions precedent, if any, provided for in this Trust
Agreement that relate to any of the matters set forth in Section 314(c) of the
Trust Indenture Act. Any certificate or opinion required to be given by an
officer pursuant to Section 314(c)(1) of the Trust Indenture Act shall be given
in the form of an Officers' Certificate.
SECTION 8.17 Number of Trustees.
(a) The number of Trustees shall be four, provided that the
Holder of all of the Common Securities by written instrument may increase or
decrease the number of Administrative Trustees. The Property Trustee and the
Delaware Trustee may be the same Person.
(b) If a Trustee ceases to hold office for any reason and the
number of Administrative Trustees is not reduced pursuant to Section 8.17(a), or
if the number of Trustees is increased pursuant to Section 8.17(a), a vacancy
shall occur. The vacancy shall be filled with a Trustee appointed in accordance
with Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to annul the Trust. Whenever a vacancy in the number of Administrative Trustees
shall occur, until such
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vacancy is filled by the appointment of an Administrative Trustee in accordance
with Section 8.10, the Administrative Trustees in office, regardless of their
number (and notwithstanding any other provision of this Agreement), shall have
all the powers granted to the Administrative Trustees and shall discharge all
the duties imposed upon the Administrative Trustees by this Trust Agreement.
SECTION 8.18. Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 2.7(a), including any registration statement or
amendment thereto filed with the Commission, or making any other governmental
filing; and
(b) The Administrative Trustees shall have power to delegate
from time to time to such of their number or to the Depositor the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Administrative Trustees or otherwise as the Administrative
Trustees may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of this Trust Agreement, as set
forth herein.
ARTICLE IX.
TERMINATION, LIQUIDATION AND MERGER
SECTION 9.1 Perpetual Existence.
Unless terminated hereunder, the Trust shall have perpetual
existence.
SECTION 9.2 Early Termination.
The first to occur of any of the following events is an "Early
Termination Event":
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor;
(b) the written direction to the Property Trustee from the
Depositor at any time to terminate the Trust and distribute Subordinated Debt
Securities to Holders in exchange for the Preferred Securities (which direction
is optional and wholly within the discretion of the Depositor);
(c) the redemption of all of the Preferred Securities in
connection with the redemption of all the Subordinated Debt Securities; and
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(d) the entry of an order for dissolution of the Trust by a
court of competent jurisdiction.
SECTION 9.3 Termination.
The respective obligations and responsibilities of the
Trustees and the Trust created and continued hereby shall terminate upon the
latest to occur of the following: (a) the distribution by the Property Trustee
to Holders upon the liquidation of the Trust pursuant to Section 9.4, or upon
the redemption of all of the Trust Securities pursuant to Section 4.2, of all
amounts required to be distributed hereunder upon the final payment of the Trust
Securities; (b) the payment of any expenses owed by the Trust; and (c) the
discharge of all administrative duties of the Administrative Trustees, including
the performance of any tax reporting obligations with respect to the Trust or
the Holders.
SECTION 9.4 Liquidation.
(a) If an Early Termination Event specified in clause (a), (b)
or (d) of Section 9.2 occurs, the Trust shall be liquidated by the Trustees as
expeditiously as the Trustees determine to be possible by distributing, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, to each Holder a Like Amount of Subordinated Debt Securities, subject to
Section 9.4(d). Notice of liquidation shall be given by the Property Trustee by
first-class mail, postage prepaid mailed not later than 30 nor more than 60 days
prior to the Liquidation Date to each Holder of Trust Securities at such
Holder's address appearing in the Securities Register. All notices of
liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent a Like Amount of Subordinated Debt Securities or the right to
receive a Liquidation Distribution, as applicable; and
(iii) provide such information with respect to the mechanics
by which Holders may exchange Trust Securities Certificates for
Subordinated Debt Securities, or if Section 9.4(d) applies receive a
Liquidation Distribution, as the Administrative Trustees or the
Property Trustee shall deem appropriate.
(b) Except where Section 9.2(c) or 9.4(d) applies, in order to
effect the liquidation of the Trust and distribution of the Subordinated Debt
Securities to Holders, the Property Trustee, either itself acting as exchange
agent or through the appointment of a separate exchange agent, shall establish
such procedures as it shall deem appropriate to effect the distribution of
Subordinated Debt Securities in exchange for the Outstanding Trust Securities
Certificates.
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(c) Except where Section 9.2(c) or 9.4(d) applies, after the
Liquidation Date, (i) the Trust Securities will no longer be deemed to be
Outstanding, (ii) certificates representing a Like Amount of Subordinated Debt
Securities will be issued to holders of Trust Securities Certificates, upon
surrender of such certificates to the Administrative Trustees or their agent for
exchange, (iii) the Depositor shall use its best efforts to have the
Subordinated Debt Securities listed on the New York Stock Exchange or on such
other exchange, interdealer quotation system or self-regulatory organization as
the Preferred Securities are then listed, (iv) any Trust Securities Certificates
not so surrendered for exchange will be deemed to represent a Like Amount of
Subordinated Debt Securities, accruing interest at the rate provided for in the
Subordinated Debt Securities from the last Distribution Date on which a
Distribution was made on such Trust Securities Certificates until such
certificates are so surrendered (and until such certificates are so surrendered,
no payments of interest or principal will be made to Holders of Trust Securities
Certificates with respect to such Subordinated Debt Securities) and (v) all
rights of Holders holding Trust Securities will cease, except the right of such
Holders to receive Subordinated Debt Securities upon surrender of Trust
Securities Certificates.
(d) In the event that, notwithstanding the other provisions of
this Section 9.4, whether because of an order for dissolution entered by a court
of competent jurisdiction or otherwise, distribution of the Subordinated Debt
Securities in the manner provided herein is determined by the Property Trustee
not to be practical, the Trust Property shall be liquidated, and the Trust shall
be dissolved, wound-up or terminated, by the Property Trustee in such manner as
the Property Trustee determines. In such event, on the date of the dissolution,
winding-up or other termination of the Trust, Holders will be entitled to
receive out of the assets of the Trust available for distribution to Holders,
after satisfaction of liabilities to creditors of the Trust as provided by
applicable law, an amount equal to the Liquidation Amount per Trust Security
plus accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If, upon any such 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, subject to the next succeeding sentence, the
amounts payable by the Trust on the Trust Securities shall be paid on a pro rata
basis (based upon Liquidation Amounts). The holder of the Common Securities will
be entitled to receive Liquidation Distributions upon any such dissolution,
winding-up or termination pro rata (determined as aforesaid) with Holders of
Preferred Securities, except that, if an Indenture Event of Default has occurred
and is continuing, the Preferred Securities shall have a priority over the
Common Securities.
SECTION 9.5 Mergers, Consolidations, Amalgamations or
Replacements of the Trust.
The Trust may not merge with or into, consolidate, amalgamate,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except pursuant
to this Section 9.5. At the request of the Depositor, with the consent of the
Administrative Trustees and without the consent of the Holders of the Preferred
Securities, the Property Trustee or the Delaware Trustee, the Trust may merge
with or into, consolidate, amalgamate, or be replaced by or convey, transfer or
- 51 -
<PAGE>
lease its properties and assets substantially as an entirety to a trust
organized as such under the laws of any State; provided, that (i) such successor
entity either (a) expressly assumes all of the obligations of the Trust with
respect to the Preferred Securities or (b) substitutes for the Preferred
Securities other securities having substantially the same terms as the Preferred
Securities (the "Successor Securities") so long as the Successor Securities rank
the same as the Preferred Securities rank in priority with respect to
distributions and payments upon liquidation, redemption and otherwise, (ii) the
Depositor expressly appoints a trustee of such successor entity possessing the
same powers and duties as the Property Trustee as the holder of the Subordinated
Debt Securities, (iii) the Successor Securities are listed or traded, or any
Successor Securities will be listed upon notification of issuance, on any
national securities exchange or other organization on which the Preferred
Securities are then listed or traded, if any, (iv) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause the
Preferred Securities (including any Successor Securities) to be downgraded by
any nationally recognized statistical rating organization, (v) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the holders of the
Preferred Securities (including any Successor Securities) in any material
respect, (vi) such successor entity has a purpose identical to that of the
Trust, (vii) prior to such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, the Depositor has received an Opinion of Counsel
to the effect that (a) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the Holders of the Preferred Securities (including any
Successor Securities) in any material respect, and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the Trust nor such successor entity will be required to register as an
investment company under the 1940 Act and (viii) the Depositor owns all of the
Common Securities of such successor entity and guarantees the obligations of
such successor entity under the Successor Securities at least to the extent
provided by the Guarantee. Notwithstanding the foregoing, the Trust shall not,
except with the consent of holders of 100% in Liquidation Amount of the
Preferred Securities, 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 other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation, merger, replacement, conveyance, transfer or lease would cause the
Trust or the successor entity to be classified as other than a grantor trust for
United States Federal income tax purposes.
ARTICLE X.
MISCELLANEOUS PROVISIONS
SECTION 10.1 Limitation of Rights of Holders.
The death or incapacity of any Person having an interest,
beneficial or otherwise, in Trust Securities shall not operate to terminate this
Trust Agreement, nor entitle the legal representatives or heirs of such person
or any Holder for such Person, to claim an accounting, take any action or bring
any proceeding in any court for a partition or winding
- 52 -
<PAGE>
up of the arrangements contemplated hereby, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
SECTION 10.2 Amendment.
(a) This Trust Agreement may be amended from time to time by
the Property Trustee, the Administrative Trustees and the Depositor, without the
consent of any Holders, (i) to cure any ambiguity, correct or supplement any
provision herein which may be inconsistent with any other provision herein, or
to make any other provisions with respect to matters or questions arising under
this Trust Agreement, which shall not be inconsistent with the other provisions
of this Trust Agreement, or (ii) to modify, eliminate or add to any provisions
of this Trust Agreement to such extent as shall be necessary to ensure that the
Trust will be classified for United States Federal income tax purposes as a
grantor trust at all times that any Trust Securities are outstanding or to
ensure that the Trust will not be required to register as an investment company
under the 1940 Act; provided, however, that in the case of clause (i), such
action shall not adversely affect in any material respect the interests of any
Holder, and any amendments of this Trust Agreement shall become effective when
notice thereof is given to the Holders.
(b) Except as provided in Section 10.2(c) hereof, any
provision of this Trust Agreement may be amended by the Trustees and the
Depositor with (i) the consent of Holders representing not less than a majority
(based upon Liquidation Amounts) of the Trust Securities then Outstanding and
(ii) receipt by the Trustees of an Opinion of Counsel to the effect that such
amendment or the exercise of any power granted to the Trustees in accordance
with such amendment will not affect the Trust's status as a grantor trust for
United States Federal income tax purposes or the Trust's exemption from status
of an investment company under the 1940 Act.
(c) In addition to and notwithstanding any other provision in
this Trust Agreement, without the consent of each affected Holder (such consent
being obtained in accordance with Section 6.3 or 6.6 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date or (ii) restrict the right of a Holder to institute suit for the
enforcement of any such payment on or after such date; notwithstanding any other
provision herein, without the unanimous consent of the Holders (such consent
being obtained in accordance with Section 6.3 or 6.6 hereof), this paragraph (c)
of this Section 10.2 may not be amended.
(d) Notwithstanding any other provisions of this Trust
Agreement, no Trustee shall enter into or consent to any amendment to this Trust
Agreement which would cause the Trust to fail or cease to qualify for the
exemption from status of an investment company under the 1940 Act or fail or
cease to be classified as a grantor trust for United States Federal income tax
purposes.
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<PAGE>
(e) Notwithstanding anything in this Trust Agreement to the
contrary, without the consent of the Depositor, this Trust Agreement may not be
amended in a manner which imposes any additional obligation on the Depositor.
(f) In the event that any amendment to this Trust Agreement is
made, the Administrative Trustees shall promptly provide to the Depositor a copy
of such amendment.
(g) Neither the Property Trustee nor the Delaware Trustee
shall be required to enter into any amendment to this Trust Agreement which
affects its own rights, duties or immunities under this Trust Agreement. The
Property Trustee shall be entitled to receive an Opinion of Counsel and an
Officers' Certificate stating that any amendment to this Trust Agreement is in
compliance with this Trust Agreement.
SECTION 10.3 Separability.
In case any provision in this Trust Agreement or in the Trust
Securities Certificates shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 10.4 Governing Law.
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF
THE HOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT AND
THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAWS OF THE STATE OF DELAWARE.
SECTION 10.5 Payments Due on Non-Business Day.
If the date fixed for any payment on any Trust Security shall
be a day that is not a Business Day, then such payment need not be made on such
date but may be made on the next succeeding day that is a Business Day (except
as otherwise provided in Sections 4.1(a) and 4.2(d)), with the same force and
effect as though made on the date fixed for such payment, and no interest shall
accrue thereon for the period after such date.
SECTION 10.6 Successors.
This Trust Agreement shall be binding upon and shall inure to
the benefit of any successor to the Depositor, the Trust or the Relevant
Trustee, including any successor by operation of law. Except in connection with
a consolidation, merger or sale involving the Depositor that is permitted under
Article Eight of the Indenture and pursuant to which the assignee agrees in
writing to perform the Depositor's obligations hereunder, the Depositor shall
not assign its obligations hereunder.
- 54 -
<PAGE>
SECTION 10.7 Headings.
The Article and Section headings are for convenience only and
shall not affect the construction of this Trust Agreement.
SECTION 10.8 Reports, Notices and Demands.
Any report, notice, demand or other communication which by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon any Holder or the Depositor may be given or served in writing by
deposit thereof, first-class postage prepaid, in the United States mail, hand
delivery or facsimile transmission, in each case, addressed, (a) in the case of
a Holder of Preferred Securities, to such Holder as such Holder's name and
address may appear on the Securities Register; and (b) in the case of the Holder
of the Common Securities or the Depositor, to Willamette Industries, Inc., 1300
S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201, Attention: G. W. Hawley,
facsimile no.: (503) 273-5604. Any notice to Holders of Preferred Securities
shall also be given to such owners as have, within two years preceding the
giving of such notice, filed their names and addresses with the Property Trustee
for that purpose. Such notice, demand or other communication to or upon a Holder
shall be deemed to have been sufficiently given or made, for all purposes, upon
hand delivery, mailing or transmission.
Any notice, demand or other communication which by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon the Trust, the Property Trustee, the Delaware Trustee or the
Administrative Trustees shall be given in writing addressed (until another
address is published by the Trust) as follows: (a) with respect to the Property
Trustee to [-----------------------------------------------; (b) with respect to
the Delaware Trustee, to Chase Manhattan Bank Delaware, 1201 North Market
Street, Wilmington, Delaware 19801, Attn: ; and (c) with respect to the
Administrative Trustees, to them at the address above for notices to the
Depositor, marked "Attention Administrative Trustees of Willamette Capital II."
Such notice, demand or other communication to or upon the Trust or the Property
Trustee shall be deemed to have been sufficiently given or made only upon actual
receipt of the writing by the Trust or the Property Trustee.
SECTION 10.9 Agreement Not to Petition.
Each of the Trustees and the Depositor agree for the benefit
of the Holders that, until at least one year and one day after the Trust has
been terminated in accordance with Article IX, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Depositor takes action in violation of this Section 10.9, the
Property Trustee agrees, for the benefit of Holders, that at the expense of the
Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such
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<PAGE>
petition by the Depositor against the Trust or the commencement of such action
and raise the defense that the Depositor has agreed in writing not to take such
action and should be stopped and precluded therefrom and such other defenses, if
any, as counsel for the Trustee or the Trust may assert. The provisions of this
Section 10.9 shall survive the termination of this Trust Agreement.
SECTION 10.10 Trust Indenture Act; Conflict with Trust Indenture
Act.
(a) This Trust Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this Trust Agreement and
shall, to the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
trustee for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts
with another provision hereof which is required to be included in this Trust
Agreement by any of the provisions of the Trust Indenture Act, such required
provision shall control. If any provision of this Trust Agreement modifies or
excludes any provision of the Trust Indenture Act which may be so modified or
excluded, the latter provision shall be deemed to apply to this Trust Agreement
as so modified or excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust
Agreement shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 10.11 Acceptance of Terms of Trust Agreement, Guarantee and
Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST
THEREIN BY OR ON BEHALF OF A HOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE HOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH
TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH HOLDER AND
SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE
BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH HOLDER AND SUCH
OTHERS.
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<PAGE>
SECTION 10.12 Expenses.
In connection with the offering, sale, and issuance of the Subordinated
Debt Securities to the Property Trustee and in connection with the sale of the
Securities, the Depositor, in its capacity as borrower with respect to the
Subordinated Debt Securities, shall:
(a) pay all costs and expenses relating to the offering, sale, and
issuance of the Subordinated Debt Securities, including commissions to the
underwriter payable pursuant to the Underwriting Agreement and compensation of
the Trustee under the Indenture in accordance with the provisions of the
Indenture;
(b) be responsible for and shall pay all debts and obligations (other
than with respect to the Trust Securities) and all costs and expenses of the
Trust (including, but not limited to, costs and expenses relating to the
organization, maintenance, and dissolution of the Trust, the offering, sale, and
issuance of the Trust Securities (including commissions to the underwriters in
connection therewith), the fees and expenses (including reasonable counsel fees
and expenses) of the Property Trustee, the Delaware Trustee, and the
Administrative Trustees, the costs and expenses relating to the operation of the
Trust, including, without limitation, costs and expenses of accountants,
attorneys, statistical or bookkeeping services, expenses for printing and
engraving and computing or accounting equipment, paying agent(s), registrar(s),
transfer agent(s), duplicating, travel and telephone and other
telecommunications expenses and costs and expenses incurred in connection with
the acquisition, financing, and disposition of Trust assets and the enforcement
by the Property Trustee of the rights of the Holders of the Preferred
Securities);
(c) be primarily liable for any indemnification obligations arising
with respect to this Declaration; and
(d) pay any and all taxes (other than Untied States withholding taxes
attributable to the Trust or its assets) and all liabilities, costs, and
expenses with respect to such taxes of the Trust.
The Depositor's obligations under this Section 10.12 shall be for the
benefit of, and shall be enforceable by, any person to whom such debts,
obligations, costs, expenses, and taxes are owed (a "Creditor") whether or not
such Creditor has received notice hereof. Any such Creditor may enforce the
Depositor's obligations under this Section 10.12 directly against the Depositor,
and the Depositor irrevocably waives any right or remedy to require that any
such Creditor take any action against the Trust or any other Person before
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<PAGE>
proceeding against the Depositor. The Depositor agrees to execute such
additional agreements as may be necessary or desirable in order to give full
effect to the provisions of this Section 10.12.
WILLAMETTE INDUSTRIES, INC.
By: ------------------------------------
Name:
Title:
- ----------------------------------------,
as Property Trustee
By: ------------------------------------
Name:
Title:
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By: ------------------------------------
Name:
Title:
- -----------------------------------------
G. W. Hawley,
as Administrative Trustee
- -----------------------------------------
Donald C. Atkinson,
as Administrative Trustee
- 58 -
<PAGE>
EXHIBIT B
[Form of Letter to Depository Trust Company]
- 59 -
<PAGE>
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
CERTIFICATE NUMBER
NUMBER OF COMMON SECURITIES
C-1
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
WILLAMETTE CAPITAL II
- ----% COMMON SECURITIES
(LIQUIDATION AMOUNT $--- PER COMMON SECURITY)
Willamette Capital II, a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies that
Willamette Industries, Inc., (the "Holder") is the registered owner of ( )
common securities of the Trust representing beneficial interests of the Trust
and designated the ----% Common Securities (liquidation amount $--- per Common
Security) (the "Common Securities"). In accordance with Section 5.10 of the
Trust Agreement (as defined below) the Common Securities are not transferable
and any attempted transfer hereof shall be void. The designations, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities are set forth in, and this certificate and the Common
Securities represented hereby are issued and shall in all respects be subject to
the terms and provisions of, the Amended and Restated Trust Agreement of the
Trust dated as of -------, -----, as the same may be amended from time to time
(the "Trust Agreement") including the designation of the terms of the Common
Securities as set forth therein. The Trust will furnish a copy of the Trust
Agreement to the Holder without charge upon written request to the Trust at its
principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the
Trust Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, one of the Administrative Trustees of the
Trust has executed this certificate this ----- day of -------, 19--.
WILLAMETTE CAPITAL II
By:------------------------
Name:
Administrative Trustee
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================================================================================
WILLAMETTE INDUSTRIES, INC.
TO
----------------------------,
TRUSTEE
-----------------
INDENTURE
DATED AS OF --------------, 1997
-----------------
SUBORDINATED DEBT SECURITIES
================================================================================
<PAGE>
WILLAMETTE INDUSTRIES, INC.
Reconciliation and tie between Trust Indenture Act
of 1939 and Indenture dated as of --------------, 1997
<TABLE>
<CAPTION>
Trust Indenture Act Section Indenture Section
- -------------------------------------------------------------------------------------------------------------------
<S> <C>
ss. 310(a)(1)...............................................................................................6.7
(a)(2)................................................................................................6.7
(a)(3).......................................................................................Inapplicable
(a)(4).......................................................................................Inapplicable
(b)..............................................................................................6.7, 6.8
(c)..........................................................................................Inapplicable
ss. 311(a)..................................................................................................6.4
(b)...................................................................................................6.4
(c)..........................................................................................Inapplicable
ss. 312(a).............................................................................................7.1, 7.2
(b)...................................................................................................7.2
(c)...................................................................................................7.2
ss. 313(a)...............................................................................................7.3(a)
(b)(1........................................................................................Inapplicable
(b)(2).............................................................................................7.3(b)
(c)................................................................................................7.3(c)
(d)................................................................................................7.3(c)
ss. 314(a)(1)...............................................................................................7.4
(a)(2)................................................................................................7.4
(a)(3)................................................................................................7.4
(a)(4)...............................................................................................10.8
(b)..........................................................................................Inapplicable
(c)(1)................................................................................................1.2
(c)(2)................................................................................................1.2
(c)(3).......................................................................................Inapplicable
(d)..........................................................................................Inapplicable
(e)...................................................................................................1.2
(f)...............................................................................................Omitted
ss. 315(a)..................................................................................................6.1
(b)..............................................................................................6.1, 6.2
(c)...................................................................................................6.1
(d)...................................................................................................6.1
(e)..................................................................................................5.14
ss. 316(a)(1)..............................................................................................5.12
(a)(2)............................................................................................Omitted
(b)...................................................................................................5.8
(c)...................................................................................................1.4
<PAGE>
Trust Indenture Act Section Indenture Section
- -------------------------------------------------------------------------------------------------------------------
ss. 317(a).............................................................................................5.3, 5.4
(b)..................................................................................................10.3
ss. 318(a)..................................................................................................1.7
- --------------
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be a part
of the Indenture.
</TABLE>
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
<S> <C>
1.1 Definitions............................................................................................ 1
1.2 Compliance Certificates and Opinions................................................................... 9
1.3 Form of Documents Delivered to Trustee................................................................. 9
1.4 Acts of Holders........................................................................................ 10
1.5 Notices, Etc., to Trustee and Company.................................................................. 12
1.6 Notice to Holders; Waiver.............................................................................. 12
1.7 Conflict with Trust Indenture Act...................................................................... 13
1.8 Effect of Headings and Table of Contents............................................................... 13
1.9 Successors and Assigns................................................................................. 13
1.10 Separability Clause.................................................................................... 13
1.11 Benefits of Indenture.................................................................................. 13
1.12 Governing Law.......................................................................................... 13
1.13 Legal Holidays......................................................................................... 14
1.14 Indenture and Securities Solely Corporate Obligations.................................................. 14
1.15 No Security Interest Created........................................................................... 14
ARTICLE 2
SECURITY FORMS
2.1 Forms Generally........................................................................................ 14
2.2 Form of Trustee's Certificate of Authentication........................................................ 15
ARTICLE 3
THE SECURITIES
3.1 Amount Unlimited; Issuable in Series................................................................... 15
3.2 Denominations.......................................................................................... 18
3.3 Execution, Authentication, Delivery and Dating......................................................... 18
3.4 Temporary Securities................................................................................... 20
3.5 Registration; Registration of Transfer and Exchange.................................................... 20
3.6 Mutilated, Destroyed, Lost and Stolen Securities....................................................... 22
3.7 Payment of Interest; Interest Rights Preserved......................................................... 23
3.8 Persons Deemed Owners.................................................................................. 24
3.9 Cancellation........................................................................................... 25
3.10 Computation of Interest................................................................................ 25
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<PAGE>
ARTICLE 4
SATISFACTION AND DISCHARGE
4.1 Satisfaction and Discharge of Securities of any Series................................................. 25
4.2 Satisfaction and Discharge of Indenture................................................................ 27
4.3 Application of Trust Money............................................................................. 27
ARTICLE 5
REMEDIES
5.1 Events of Default; Defaults............................................................................ 27
5.2 Acceleration of Maturity; Rescission and Annulment..................................................... 29
5.3 Collection of Indebtedness and Suits
for Enforcement by Trustee............................................................................. 30
5.4 Trustee May File Proofs of Claim....................................................................... 31
5.5 Trustee May Enforce Claims Without Possession of Securities............................................ 32
5.6 Application of Money Collected......................................................................... 32
5.7 Limitation on Suits.................................................................................... 32
5.8 Unconditional Right of Holders to Receive Principal,
Premium and Interest; Direct Action by Holders
of Willamette Trust Securities......................................................................... 33
5.9 Restoration of Rights and Remedies..................................................................... 33
5.10 Rights and Remedies Cumulative......................................................................... 34
5.11 Delay or Omission Not Waiver........................................................................... 34
5.12 Control by Holders..................................................................................... 34
5.13 Waiver of Past Defaults................................................................................ 35
5.14 Undertaking for Costs.................................................................................. 35
5.15 Waiver of Stay or Extension Laws....................................................................... 35
ARTICLE 6
THE TRUSTEE
6.1 Certain Rights of Trustee.............................................................................. 36
6.2 Notice of Defaults..................................................................................... 37
6.3 Not Responsible for Recitals or Issuance of Securities................................................. 37
6.4 May Hold Securities.................................................................................... 38
6.5 Money Held in Trust.................................................................................... 38
6.6 Compensation and Reimbursement......................................................................... 38
6.7 Corporate Trustee Required; Eligibility................................................................ 39
6.8 Resignation and Removal; Appointment of Successor...................................................... 39
6.9 Acceptance of Appointment by Successor................................................................. 41
6.10 Merger, Conversion, Consolidation or Succession to Business............................................ 42
6.11 Appointment and Qualification of Authenticating Agent.................................................. 42
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<PAGE>
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
7.1 Company to Furnish Trustee Names and Addresses of Holders.............................................. 44
7.2 Preservation of Information; Communications to Holders................................................. 44
7.3 Reports by Trustee..................................................................................... 45
7.4 Reports by Company..................................................................................... 45
ARTICLE 8
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
8.1 Company May Consolidate, Etc., Only on Certain Terms................................................... 46
8.2 Successor Corporation Substituted...................................................................... 47
ARTICLE 9
SUPPLEMENTAL INDENTURES
9.1 Supplemental Indentures Without Consent of Holders..................................................... 47
9.2 Supplemental Indentures with Consent of Holders........................................................ 49
9.3 Execution of Supplemental Indentures................................................................... 50
9.4 Effect of Supplemental Indentures...................................................................... 50
9.5 Reference in Securities to Supplemental Indentures..................................................... 50
ARTICLE 10
COVENANTS
10.1 Payment of Principal, Premium and Interest............................................................. 50
10.2 Maintenance of Office or Agency........................................................................ 51
10.3 Money for Securities Payments to Be Held in Trust...................................................... 51
10.4 Corporate Existence.................................................................................... 53
10.5 Restrictions on Secured Debt........................................................................... 53
10.6 Restrictions on Sales and Leasebacks................................................................... 54
10.7 Restrictions on Funded Debt of Restricted Subsidiaries................................................. 56
10.8 Statement by Officers as to Default.................................................................... 57
10.9 Waiver of Certain Covenants............................................................................ 57
ARTICLE 11
REDEMPTION OF SECURITIES
11.1 Applicability of Article............................................................................... 57
11.2 Election to Redeem; Notice to Trustee.................................................................. 57
11.3 Selection by Trustee of Securities to Be Redeemed...................................................... 58
11.4 Notice of Redemption................................................................................... 58
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<PAGE>
11.5 Deposit of Redemption Price............................................................................ 59
11.6 Securities Payable on Redemption Date.................................................................. 59
11.7 Securities Redeemed in Part............................................................................ 60
ARTICLE 12
SINKING FUNDS
12.1 Applicability of Article............................................................................... 60
12.2 Satisfaction of Sinking Fund Payments with Securities.................................................. 60
12.3 Redemption of Securities for Sinking Fund.............................................................. 61
ARTICLE 13
DEFEASANCE AND COVENANT DEFEASANCE
13.1 Applicability of Article; Company's Option to Effect
Defeasance or Covenant Defeasance...................................................................... 61
13.2 Defeasance and Discharge............................................................................... 62
13.3 Covenant Defeasance.................................................................................... 62
13.4 Conditions to Defeasance or Covenant Defeasance........................................................ 63
13.5 Deposited Money and Government Obligations to be Held
in Trust; Other Miscellaneous Provisions............................................................... 65
13.6 Reinstatement.......................................................................................... 66
ARTICLE 14
SUBORDINATION OF SECURITIES
14.1 Securities Subordinate to Senior Debt.................................................................. 66
14.2 Payment Over of Proceeds Upon Dissolution, Etc......................................................... 66
14.3 No Payment When Senior Debt in Default................................................................. 68
14.4 Payment Permitted If No Default........................................................................ 68
14.5 Subrogation to Rights of Holders of Senior Debt........................................................ 68
14.6 Provisions Solely to Define Relative Rights............................................................ 69
14.7 Holders of Senior Debt and Trustee to
Effectuate Subordination............................................................................... 69
14.8 No Waiver of Subordination Provisions.................................................................. 69
14.9 Notice to Trustee; Notice to Company................................................................... 70
14.10 Reliance on Judicial Order or Certificate
of Liquidating Agent................................................................................... 71
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<PAGE>
14.11 Trustee and Holders Not Fiduciaries for
Holders of Senior Debt................................................................................. 71
14.12 Rights of Trustee as Holder of Senior Debt;
Preservation of Trustee's Rights................................................................... 72
14.13 Article Applicable to Paying Agents.................................................................... 72
</TABLE>
- --------------
NOTE: This table of contents shall not, for any purpose,
be deemed to be a part of the Indenture.
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<PAGE>
INDENTURE, dated as of --------------, 1997, between
Willamette Industries, Inc., a corporation duly organized and existing under the
laws of the state of Oregon (herein called the "Company"), having its principal
office at First Interstate Bank Tower, 1300 S.W. Fifth Avenue, Portland, Oregon
97201, and ------------------------
- --------------------------------------------------------, as Trustee (herein
called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
subordinated debentures, notes or other evidences of indebtedness (herein called
the "Securities") unlimited as to principal amount, to be issued in one or more
series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders (as herein defined) thereof, it is mutually
covenanted and agreed, for the equal and proportionate benefit of all Holders of
the Securities or of any series thereof, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1 Definitions.
For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(1) The terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular;
(2) All other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(3) All accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with
respect to any computation
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<PAGE>
required or permitted hereunder shall mean such accounting principles
as are generally accepted at the date of such computation; and
(4) The words "herein," "hereof," "hereto," and "hereunder"
and other words of similar import refer to this Indenture as a whole
and not to any particular Article, Section, or other subdivision.
Certain terms used principally in certain Articles are defined
in those Articles.
"Act" when used with respect to any Holder has the meaning
specified in Section 1.4.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise,
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Attributable Debt" means, as to any particular lease under
which any Person is at the time liable and at any date as of which the amount
thereof is to be determined, the total net amount of rent required to be paid by
such Person under such lease during the remaining primary term thereof,
discounted from the respective due dates thereof to such date at the rate of 15
percent per annum. The net amount of rent required to be paid under any such
lease for any such period shall be the aggregate amount of rent payable by the
lessee with respect to such period after excluding amounts required to be paid
on account of maintenance and repairs, insurance, taxes, assessments, water
rates and similar charges. In the case of any lease which is terminable by the
lessee upon the payment of a penalty, such net amount shall also include the
amount of such penalty, but no rent shall be considered as required to be paid
under such lease subsequent to the first date upon which it may be so
terminated.
"Authenticating Agent" means any Person designated by the
Trustee which at the time shall be designated and acting pursuant to Section
6.11.
"Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
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<PAGE>
"Business Day," when used with respect to any Place of
Payment, means each Monday, Tuesday, Wednesday, Thursday, and Friday which is
not a day on which banking institutions in that Place of Payment are authorized
or obligated by law to close.
"Capital Stock," as applied to the stock of any corporation,
means the capital stock of every class whether now or hereafter authorized,
regardless of whether such capital stock shall be limited to a fixed sum or
percentage with respect to the rights of the holders thereof to participate in
dividends and in the distribution of assets upon the voluntary or involuntary
liquidation, dissolution or winding up of such corporation.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of 1934
or, if at any time after the execution of this Indenture 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.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor corporation.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company (a) by its Chairman of the Board, a
Vice Chairman, its Chief Executive Officer, its President or a Vice President,
and (b) by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant
Secretary, and delivered to the Trustee.
"Consolidated Net Tangible Assets" means the aggregate amount
of assets (less applicable reserves and other properly deductible items) after
deducting therefrom (i) all liabilities other than deferred income taxes, Funded
Debt and shareholders' equity and (ii) all goodwill, trade names, trademarks,
patents, organization expenses and other like intangibles, all as set forth on
the most recent balance sheet of the Company and its consolidated Subsidiaries
and computed in accordance with generally accepted accounting principles.
"Corporate Trust Office" means the principal office of the
Trustee, any Authenticating Agent, or any Paying Agent, as the case may be, at
which at any particular time its corporate trust business shall be administered.
Until notice of change thereof is given as provided in this Indenture, the
Corporate Trust Office of the Trustee is located at -----------
- ----------------------------------------------------------------------.
"Corporation" includes corporations, associations, companies
and business trusts.
"Defaulted Interest" has the meaning specified in Section 3.7.
"Depository" means, with respect to the Securities of any
series issuable or issued in the form of one or more Global Securities, the
Person designated as Depository by the
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<PAGE>
Company pursuant to Section 3.1 until a successor Depository shall have been
appointed pursuant to Section 3.5, and thereafter "Depository" shall mean or
include each Person who is then a Depository hereunder.
"Event of Default" has the meaning specified in Section 5.1.
"Funded Debt" means (i) all indebtedness for money borrowed
having a maturity of more than 12 months from the date as of which the
determination is made or having a maturity of 12 months or less but by its terms
being renewable or extendible beyond 12 months from such date at the option of
the borrower (excluding any amount thereof included in current liabilities) and
(ii) rental obligations payable more than 12 months from such date under leases
which are capitalized in accordance with generally accepted accounting
principles (such rental obligations to be included as Funded Debt at the amount
so capitalized and to be included for the purposes of the definition of
Consolidated Net Tangible Assets both as an asset and as Funded Debt at the
amount so capitalized).
"Global Security" means a Security evidencing all or part of a
series of Securities, issued to the Depository for such series or its nominee,
and registered in the name of such Depository or nominee.
"Holder" means a Person in whose name a Security is registered
in the Security Register.
"Indenture" means this instrument as originally executed or as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof
and, with respect to any Security, by the terms and provisions of such Security
established pursuant to Section 3.1 (as such terms and provisions may be amended
pursuant to the applicable provisions hereof).
"interest," when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date," when used with respect to any
Security, means the Stated Maturity of an installment of interest on such
Security.
"Maturity" when used with respect to any Security means the
date on which the principal of such Security or an installment of principal
becomes due and payable as therein or herein provided, whether at the Stated
Maturity or by declaration of acceleration, call for redemption or otherwise.
"Officers' Certificate" means a certificate signed (a) by the
Chairman of the Board, a Vice Chairman, the Chief Executive Officer, the
President or a Vice President, and (b) by the Treasurer, an Assistant Treasurer,
the Secretary or an Assistant Secretary, of the
- 4 -
<PAGE>
Company, that complies with the requirements of Section 314(e) of the Trust
Indenture Act and is delivered to the Trustee. One of the officers signing the
Officers' Certificate given pursuant to Section 10.8 shall be the principal
executive, financial, or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who
may be an employee of or counsel for the Company.
"Original Issue Discount Security" means any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 5.2.
"Outstanding" when used with respect to Securities means, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the
necessary amount has theretofore been deposited in trust with the
Trustee or any Paying Agent (other than the Company) or set aside and
segregated in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities; provided that, if
such Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and
(iii) Securities which have been paid pursuant to Section 3.6
or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than any
such Securities in respect of which there shall have been presented to
the Trustee proof satisfactory to it that such Securities are held by a
bona fide purchaser in whose hands such Securities are valid
obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, (i) the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding shall be equal to the amount of the principal thereof that would be
due and payable as of the date of such determination upon acceleration of the
Maturity thereof pursuant to Section 5.2, (ii) the principal amount of a
Security denominated in one or more foreign currencies or currency units shall
be the U.S. dollar equivalent, determined in the manner provided as contemplated
by Section 3.1 on the date of original issuance of such Security, of the
principal amount (or, in the case of an Original Issue Discount Security, the
U.S. dollar equivalent on the date of original issuance of such Security of the
amount determined as provided in (i) above) of such Security, and (iii)
Securities owned by the Company or any
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<PAGE>
other obligor upon the Securities or any Affiliate of the Company or of such
other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Securities which the Trustee knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Securities and that the pledgee
is not the Company or any other obligor upon the Securities or any Affiliate of
the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of (and premium, if any) or interest on any Security on behalf
of the Company.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Place of Payment" when used with respect to Securities of any
series means the place or places where the principal of (and premium, if any) or
interest on the Securities of such series is payable as specified pursuant to
Section 3.1 or, if not so specified, as specified in Section 10.2.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.6 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Principal Property" means (a) any mill, converting plant,
manufacturing plant or other facility owned at the date hereof or hereafter
acquired by the Company or any Restricted Subsidiary which is located within the
present 50 States of the United States or in Canada and the gross book value
(including related land and improvements thereon and all machinery and equipment
included therein without deduction of any depreciation reserves) of which on the
date as of which the determination is being made exceeds 1 percent of
Consolidated Net Tangible Assets, and (b) Timberlands, in each case other than
(i) any property which in the opinion of the Board of Directors is not of
material importance to the total business conducted by the Company and its
Restricted Subsidiaries as an entirety or (ii) any portion of a particular
property which is similarly found not to be of material importance to the use or
operation of such property or (iii) any oil, gas or other minerals or mineral
rights.
"Realty Subsidiary" means a Subsidiary of the Company engaged
primarily in the development and sale or financing of real property.
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<PAGE>
"Redemption Date," when used with respect to any Security or
portion thereof to be redeemed, means the date fixed for such redemption by or
pursuant to this Indenture.
"Redemption Price," when used with respect to any Security or
portion thereof to be redeemed, means the price at which it is to be redeemed as
determined by or pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for that
purpose as contemplated by Section 3.1.
"Responsible Officer," when used with respect to the Trustee,
means the chairman or any vice-chairman of the board of directors, the chairman
or any vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any vice president, the
secretary, any assistant secretary, the treasurer, any assistant treasurer, the
cashier, any assistant cashier, any trust officer or assistant trust officer,
the controller or any assistant controller or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"Restricted Subsidiary" means a Subsidiary of the Company (i)
substantially all the property of which is located, or substantially all the
business of which is carried on, within the present 50 States of the United
States or in Canada and (ii) which owns a Principal Property, but does not
include a Realty Subsidiary.
"Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Securities authenticated and
delivered under this Indenture.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 3.5.
"Senior Debt" shall mean (x) the principal of and premium, if
any, and interest on the following, whether outstanding on the date of execution
of this Indenture or thereafter incurred or created: (i) indebtedness of the
Company for money borrowed by the Company (including purchase money obligations
with an original maturity in excess of one year) or evidenced by debentures
(other than the Securities), notes, bankers' acceptances or other corporate debt
securities or similar instruments issued by the Company; (ii) obligations with
respect to letters of credit; (iii) indebtedness of the Company constituting a
guarantee of indebtedness of others of the type referred to in the preceding
clauses (i) and (ii); or (iv) renewals, extensions or refundings of any of the
indebtedness referred to in the preceding clauses (i), (ii) and (iii) unless, in
the case of any particular indebtedness, renewal, extension or refunding, under
the express provisions of the instrument creating or evidencing the same,
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<PAGE>
or pursuant to which the same is outstanding, such indebtedness or such renewal,
extension or refunding thereof is not superior in right of payment to the
Securities, and (y) any other indebtedness designated as such pursuant to an
indenture supplemental hereto or in or pursuant to a Board Resolution and set
forth in an Officers' Certificate, in either case executed and delivered prior
to or concurrently with the supplemental indenture or Officers' Certificate
setting forth the terms of the initial series of Securities issued hereunder.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 3.7.
"Stated Maturity," when used with respect to any Security or
any installment of principal thereof or interest thereon, means the date
specified in such Security as the fixed date on which the principal of such
Security or such installment of principal thereof or interest is due and
payable.
"Subsidiary" means a corporation more than 50 percent of the
outstanding Voting Stock of which is owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or more
other Subsidiaries.
"Timberlands" means any real property of the Company or any
Restricted Subsidiary of the Company located within the present 50 States of the
United States or in Canada which contains standing timber which is (or upon
completion of a growth cycle then in process is expected to become) of a
commercial quantity and of merchantable quality, excluding, however, any such
real property which at the time of determination is held primarily for
development or sale, and not primarily for the production of lumber or any other
timber products.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder, and
if at any time there is more than one such Person, "Trustee" as used with
respect to the Securities of any series shall mean the Trustee with respect to
the Securities of such series.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed; provided,
however, that in the event the Trust Indenture Act of 1939 is amended after such
date, "Trust Indenture Act" means, to the extent required by any such amendment,
the Trust Indenture Act of 1939 as so amended.
"Vice President," when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president."
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<PAGE>
"Voting Stock," as applied to the stock (or the equivalent
thereof) of any corporation, means stock (or such equivalent) of any class or
classes, however designated, having ordinary voting power (whether at all times
or only so long as no senior class of stock has such voting power by reason of
the happening of a contingency) for the election of a majority of the directors
of such corporation, other than stock (or such equivalent) having such power
only by reason of the happening of a contingency.
"Willamette Trust" means a business trust established by or at
the direction of the Company to make a loan or loans to the Company to be
evidenced by Securities.
"Willamette Trust Securities" means securities representing
preferred or common interests in a Willamette Trust.
SECTION 1.2 Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with and an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Indenture relating to such particular application or request, no
additional certificate or opinion need be furnished. Each such Officers'
Certificate and Opinion of Counsel shall comply with Section 314(e) of the Trust
Indenture Act.
SECTION 1.3 Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care
- 9 -
<PAGE>
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 1.4 Acts of Holders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by or pursuant to this Indenture to be
given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by an agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 315 of the Trust Indenture
Act) conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
Without limiting the generality of the foregoing, a Holder,
including a Depository that is a Holder of a Global Security, may make, give, or
take, by a proxy, or proxies, duly appointed in writing, any request, demand,
authorization, direction, notice, consent, waiver, or other action provided or
permitted in this Indenture to be made, given, or taken by Holders, and a
Depository that is a Holder of a Global Security may provide its proxy or
proxies to the beneficial owners of interest in any such Global Security.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other reasonable manner which the Trustee deems sufficient.
(c) The ownership of Securities shall be proved by the
Securities Register.
(d) Except as provided in the next paragraph, the Company may,
in the circumstances permitted by the Trust Indenture Act, set any day as the
record date for the purpose of determining the Holders of Securities of any
series entitled to give or take any
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<PAGE>
request, demand, authorization, direction, notice, consent, waiver or other
action, or to vote on any action, authorized or permitted to be given or taken
by Holders of Securities of such series. With regard to any record date set
pursuant to this paragraph, the Holders of Outstanding Securities of the
relevant series on such record date (or their duly appointed agents), and only
such Persons, shall be entitled to give or take the relevant action, whether or
not such Holders remain Holders after such record date. With regard to any
action that may be given or taken hereunder only by Holders of a requisite
principal amount of Outstanding Securities of any series (or their duly
appointed agents) and for which a record date is set pursuant to this paragraph,
the Company may, at its option, set an expiration date after which no such
action purported to be given or taken by any Holder shall be effective hereunder
unless given or taken on or prior to such expiration date by Holders of the
requisite principal amount of Outstanding Securities of such series on such
record date (or their duly appointed agents). On or prior to any expiration date
set pursuant to this paragraph, the Company may, on one or more occasions at its
option, extend such date to any later date. Nothing in this paragraph shall
prevent any Holder (or any duly appointed agent thereof) from giving or taking,
after any expiration date, any action identical to, or, at any time, contrary to
or different from any action given or taken, or purported to have been given or
taken, hereunder by a Holder on or prior to such date, in which event the
Company may set a record date in respect thereof pursuant to this paragraph.
Notwithstanding the foregoing, upon receipt by the Trustee,
with respect to Securities of any series, of (i) any Notice of Default as
described in Section 5.1, (ii) any declaration of acceleration, or any
rescission and annulment of any such declaration pursuant to Section 5.2, or
(iii) any direction given pursuant to Section 5.12 (any such notice,
declaration, rescission and annulment, or direction being referred to herein as
a "Direction"), a record date shall automatically and without any other action
by any Person be set for the purpose of determining the Holders of Outstanding
Securities of such series entitled to join in such Direction, which record date
shall be the close of business on the day the Trustee receives such Direction.
The Holders of Outstanding Securities of such series on such record date (or
their duly appointed agents), and only such Persons, shall be entitled to join
in such Direction, whether or not such Holders remain Holders after such record
date; provided that, unless such Direction shall have become effective by virtue
of Holders of the requisite principal amount of Outstanding Securities of such
series on such record date (or their duly appointed agents) having joined
therein on or prior to the 90th day after such record date, such Direction shall
automatically and without any action by any Person be canceled and of no further
effect. Nothing in this paragraph shall prevent a Holder (or a duly appointed
agent thereof) from giving, before or after the expiration of such 90-day
period, a Direction contrary to or different from, or, after the expiration of
such period, identical to, a Direction that has been canceled pursuant to the
proviso to the preceding sentence, in which event a new record date in respect
thereof shall be set pursuant to this paragraph.
Without limiting the foregoing, a Holder entitled hereunder to
give or take any action hereunder with regard to any particular Security may do
so with regard to all or any part of the principal amount of such Security or by
one or more duly appointed agents each of which
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<PAGE>
may do so pursuant to such appointment with regard to all or any different part
of such principal amount.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other action of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee, any
Security Registrar, any Paying Agent or the Company in reliance thereon, whether
or not notation of such action is made upon such Security.
SECTION 1.5 Notices, Etc., to Trustee and Company.
Except as otherwise specifically provided herein, any request,
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with
(1) The Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office,
Attention: Corporate Trust Administration Division; or
(2) The Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to the attention of its Secretary at
the address of its principal office specified in the first paragraph of
this instrument or at any other address previously furnished in writing
to the Trustee by the Company.
SECTION 1.6 Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each Holder affected by such event, at his address as it appears in the Security
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders and any notice which is
mailed in the manner herein provided shall be conclusively presumed to have been
duly given. Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
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In any case by reason of the suspension of regular mail
service or by reason of any other cause it shall be impracticable to give such
notice by mail, then such notification as shall be made with the approval of the
Trustee shall constitute a sufficient notification for every purpose hereunder.
SECTION 1.7 Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with
any duties under any required provision of the Trust Indenture Act imposed
hereon by Section 318(c) thereof, such required provision shall control.
SECTION 1.8 Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
SECTION 1.9 Successors and Assigns.
All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.
SECTION 1.10 Separability Clause.
In case any provision in this Indenture or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 1.11 Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or
implied, shall give to any Person, other than the parties hereto, any Paying
Agent, any Security Registrar, any Authenticating Agent and their respective
successors hereunder, the holders of Senior Debt or the holders of Willamette
Trust Securities, and the Holders, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
SECTION 1.12 Governing Law.
This Indenture and the Securities shall be governed by and
construed in accordance with the laws of the state of New York.
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SECTION 1.13 Legal Holidays.
In any case where any Interest Payment Date, Redemption Date,
the Stated Maturity of any Security or any date upon which any Defaulted
Interest is proposed to be paid shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of the
Securities) payment of interest, if any, or principal (and premium, if any) need
not be made at such Place of Payment on such date, but may be made on the next
succeeding Business Day at such Place of Payment with the same force and effect
as if made on the Interest Payment Date, Redemption Date, at the Stated
Maturity, or on the date for payment of Defaulted Interest, provided that no
interest shall accrue for the period from and after such Interest Payment Date,
Redemption Date, Stated Maturity or date for the payment of Defaulted Interest,
as the case may be.
SECTION 1.14 Indenture and Securities Solely Corporate Obligations.
No recourse for the payment of the principal of (or premium,
if any) or interest on any Security, or for any claim based thereon or otherwise
in respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in this Indenture or in any supplemental indenture, or
in any Security, or because of the creation of any indebtedness represented
thereby, shall be had against any incorporator, shareholder, officer or
director, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise; it being expressly
understood that all such liability is hereby expressly waived and released as a
condition of, and as a consideration for, the execution of this Indenture and
the issue of the Securities.
SECTION 1.15 No Security Interest Created.
Nothing in this Indenture or in the Securities, expressed or
implied, shall be construed to constitute a security interest under the Uniform
Commercial Code or similar legislation as now or hereafter enacted and in
effect, in any jurisdiction where the property of the Company or its
Subsidiaries is located.
ARTICLE 2
SECURITY FORMS
SECTION 2.1 Forms Generally.
The Securities of each series shall be in substantially the
form as shall be established in or pursuant to a Board Resolution or in one or
more indentures supplemental hereto, in each case, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and may have such letters, numbers or
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other marks of identification and such legends or endorsements placed thereon as
may be required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of the Securities. Global Securities shall bear
a legend respecting the restrictions on transfer thereof in such form as may be
determined by the officers executing such Global Securities, as evidenced by
their execution of the Global Securities. If the form of Securities of any
series is established by action taken pursuant to a Board Resolution, an
appropriate Officers' Certificate setting forth such form together with a copy
of the Board Resolution shall be delivered to the Trustee and any Authenticating
Agent at or prior to the delivery of the Company Order contemplated by Section
3.3 for the authentication and delivery of such Securities.
The definitive Securities shall be printed, lithographed or
engraved or produced by any combination of these methods or may be produced in
any other manner, all as determined by the officers executing such Securities,
as evidenced by their execution of such Securities.
SECTION 2.2 Form of Trustee's Certificate of Authentication.
Subject to Section 6.10, the Trustee's certificate of
authentication shall be in substantially the following form:
This is one of the Securities of the series designated herein
referred to in the within-mentioned Indenture.
---------------------------------------------
as Trustee
By-------------------------------------------
Authorized Officer
ARTICLE 3
THE SECURITIES
SECTION 3.1 Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited. The Securities
may be issued in one or more series.
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There shall be established in or pursuant to a Board
Resolution, and set forth in an Officers' Certificate, or established in one or
more indentures supplemental hereto, prior to the issuance of Securities of any
series:
(1) The title of the Securities of the series (which shall
distinguish the Securities of the series from all other Securities);
(2) Any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the series pursuant to Sections 3.4, 3.5, 3.6, 9.5, or
11.7);
(3) The date or dates on which the principal of (and premium,
if any, on) the Securities of the series is payable;
(4) The rate or rates at which the Securities of the series
shall bear interest, if any, or the method or methods, if any, by which
such rate or rates are to be determined, the date or dates, if any,
from which such interest shall accrue, the Interest Payment Dates, if
any, on which such interest shall be payable, the Regular Record Dates,
if any, for the interest payable on any Interest Payment Date, the rate
or rates of interest, if any, payable on overdue installments of
interest on or principal of (and premium, if any, on) the Securities of
the series and the basis upon which interest shall be calculated if
other than a 360-day year of twelve 30-day months;
(5) If in addition to or other than the Borough of Manhattan,
the City of New York, New York, the place or places where the principal
of (and premium, if any) and interest, if any, on the Securities of the
series shall be payable, any of such Securities may be surrendered for
registration of transfer or exchange, and notices or demands to or upon
the Company in respect of such Securities and this Indenture may be
served; provided, however, that, at the option of the Company, any
interest on such Securities may be paid by check mailed to the address
of the Person entitled thereto as such address shall appear in the
Security Register;
(6) If the Securities of the series are redeemable, the period
or periods within which, the price or prices at which and the terms and
conditions upon which such Securities may be redeemed, in whole or in
part, at the option of the Company;
(7) The obligation, if any, of the Company to redeem or
purchase Securities of the series pursuant to any sinking fund or
analogous provisions
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or at the option of any Holder thereof and the period or periods within
which, the price or prices at which and the other terms and conditions
upon which such Securities shall be redeemed or purchased, in whole or
in part, pursuant to such obligation;
(8) If any of the Securities of the series are issuable upon
original issuance in whole or in part in the form of one or more Global
Securities, the Depository for such Global Security or Securities and
the circumstances, if any, under which any such Global Security may be
exchanged for Securities registered in the name of, and any transfer of
such Global Security may be registered to, a Person other than such
Depository or its nominee, if other than as set forth in Section 3.5;
(9) If other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of the series
shall be issuable;
(10) If either or both of (a) defeasance of the Securities of
the series under Section 13.2 or (b) covenant defeasance of the
Securities of such series under Section 13.3 are applicable; and if
covenant defeasance of the Securities of such series under Section 13.3
is applicable any covenants in addition to those specified in Section
13.3;
(11) If other than the principal amount thereof, the portion
of the principal amount of Securities of the series which shall be
payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 5.2 or the method by which such portion is to be
determined;
(12) The currency, currencies, or currency units in which
payment of the principal of and any premium and interest on any
Securities of the series shall be payable if other than the currency of
the United States of America and the manner of determining the
equivalent thereof in the currency of the United States of America for
purposes of the definition of "Outstanding" in Section 1.1;
(13) If the amount of payments of principal of or any premium
or interest on any Securities of the series may be determined with
reference to an index, the manner in which such amounts shall be
determined;
(14) The additional covenants of the Company, if any, for the
benefit of the Holders of the Securities of the series or for the
benefit of holders of Senior Debt or the holders of Willamette Trust
Securities and the additional Events of Default, if any, with respect
to the Securities of the series;
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(15) Any provision allowing a set-off in respect of amounts
paid pursuant to any guaranty by the Company of Willamette Trust
Securities, any provision allowing holders of a specified percentage of
any series of Willamette Trust Securities to take any action in respect
of any series of Securities, and any other provisions relative to
Willamette Trust Securities or any guaranty thereof; and
(16) Any other terms, conditions, rights and preferences (or
limitations on such rights and preferences) relating to Securities of
the series.
All Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided in
or pursuant to such Board Resolution and set forth in such Officers'
Certificate or in any such indenture supplemental hereto.
If any of the terms of the Securities of the series are
established by action taken pursuant to a Board Resolution, a copy of an
appropriate record of such action shall be certified by the Secretary or an
Assistant Secretary of the Company and delivered to the Trustee at or prior to
the delivery of the Officers' Certificate setting forth the terms of the series.
SECTION 3.2 Denominations.
The Securities of each series shall be issuable in registered
form without coupons in such denominations as shall be specified as contemplated
by Section 3.1. In the absence of any such provisions with respect to the
Securities of any series, the Securities of such series shall be issuable in
denominations of $1,000 and any integral multiple thereof.
SECTION 3.3 Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by
its Chairman of the Board, one of its Vice Chairmen, its Chief Executive
Officer, its President or one of its Vice Presidents, under its corporate seal
reproduced thereon attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers on the Securities may be
manual or facsimile.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any series
executed by the Company to the Trustee for authentication, together with the
Board Resolution and Officers' Certificate or supplemental indenture with
respect to such Securities referred to in Section 3.1 and a Company
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Order for the authentication and delivery of such Securities; and the Trustee,
in accordance with such Company Order, shall authenticate and deliver such
Securities. If all the Securities of any series are not to be issued at one
time, and if the Board Resolution, Officers' Certificate or supplemental
indenture establishing such series shall so permit, such Company Order may set
forth procedures acceptable to the Trustee for the issuance of such Securities
and the determination of the terms of particular Securities of such series such
as interest rate, maturity date, date of issuance and date from which interest
shall accrue. If the form or forms or terms of the Securities of the series have
been established in or pursuant to one or more Board Resolutions or supplemental
indenture as permitted by Sections 2.1 and 3.1, in authenticating such
Securities, and accepting the additional responsibilities under this Indenture
in relation to such Securities, the Trustee shall be entitled to receive, and
(subject to Sections 315(a) through 315(d) of the Trust Indenture Act) shall be
fully protected in relying upon, an Opinion of Counsel stating that:
(1) The form or forms and terms of such Securities have been
established in conformity with the provisions of this Indenture; and
(2) All conditions precedent described herein to the
authentication and delivery of such Securities have been complied with.
If all the Securities of any series are not to be issued at
one time, it shall not be necessary to deliver an Opinion of Counsel at the time
of issuance of each Security, but such Opinion of Counsel, with appropriate
modifications, may instead be delivered at or prior to the time of issuance of
the first Security of such series.
The Trustee shall not be required to authenticate any
Securities if it, being advised by counsel, determines that such action may not
lawfully be taken, or the Trustee shall determine in good faith that such action
would expose it to personal liability to existing Holders or if the issue of
such Securities pursuant to this Indenture will affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture or otherwise in a
manner which is not reasonably acceptable to the Trustee.
If the Company shall establish pursuant to Section 3.1 that
the Securities of a series are to be issued in whole or in part in the form of
one or more Global Securities, then the Company shall execute, and the Trustee
shall, in accordance with this Section and a Company Order for the
authentication and delivery of a Global Security or Securities of such series,
authenticate and deliver one or more Global Securities that (i) shall represent
and shall be denominated in an aggregate amount equal to the aggregate principal
amount of the Outstanding Securities of such series to be represented by such
Global Security or Securities, and (ii) shall be registered in the name of the
Depository for such Global Security or Securities or the nominee of such
Depository.
Each Security shall be dated the date of its authentication.
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No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein executed by the Trustee by manual signature. Such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder.
Notwithstanding the foregoing, if any Security shall have been
duly authenticated and delivered hereunder but never issued and sold by the
Company, and the Company shall deliver such Security to the Trustee for
cancellation as provided in Section 3.9 together with a written statement (which
need not comply with Section 1.2 and need not be accompanied by an Opinion of
Counsel) stating that such Security has never been issued and sold by the
Company, for all purposes of this Indenture such Security shall be deemed never
to have been authenticated and delivered hereunder and shall not be entitled to
the benefits of this Indenture.
SECTION 3.4 Temporary Securities.
Pending the preparation of definitive Securities of any
series, the Company may execute and deliver to the Trustee and, upon Company
Order, the Trustee shall authenticate and deliver, temporary Securities which
are printed, lithographed, typewritten, mimeographed or otherwise produced, in
any authorized denomination, substantially of the tenor of the definitive
Securities in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers of the
Company executing such Securities may determine, as evidenced by their execution
of such Securities. Such temporary Securities may be Global Securities.
If temporary Securities of any series are issued, the Company
shall cause definitive Securities of that series to be prepared without
unreasonable delay. After the preparation of definitive Securities of such
series, the temporary Securities of such series shall be exchangeable for
definitive Securities of such series of like tenor and aggregate principal
amount upon surrender of the temporary Securities of such series at any office
or agency of the Company designated pursuant to Section 10.2 without charge to
the Holder. Upon surrender for cancellation of any one or more temporary
Securities of any series, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor definitive Securities of the same
series of authorized denominations of a like tenor and aggregate principal
amount. Until so exchanged the temporary Securities of any series shall in all
respects be entitled to the same benefits under this Indenture as definitive
Securities of such series and tenor.
SECTION 3.5 Registration; Registration of Transfer and Exchange.
With respect to each series of Securities, the Company shall
cause to be kept at one of the offices or agencies to be maintained by the
Company as provided in Section 10.2 a register (herein sometimes referred to as
the "Security Register") in which, subject to such reasonable regulations as it
may prescribe, the Company shall provide for the registration of that
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series of Securities and of transfers of that series of Securities. Such office
or agency shall be the "Security Registrar" for that series of Securities. In
the event that the Trustee shall not be the Security Registrar, the Security
Register and the records of the Security Registrar relating to the performance
of its duties as such shall be open for inspection by the Trustee at all
reasonable times. The Trustee is hereby initially appointed as Security
Registrar for each series of Securities.
Upon surrender for registration of transfer of any Security of
any series at said office or agency for that series, the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of the same series of any
authorized denominations, of a like tenor and aggregate principal amount.
At the option of the Holder, Securities of any series may be
exchanged for other Securities of the same series, of any authorized
denominations, of a like tenor and aggregate principal amount, upon surrender of
the Securities to be exchanged at any office or agency for such series. Whenever
any Securities are so surrendered for exchange, the Company shall execute, and
the Trustee shall authenticate and deliver, the Securities which the Holder
making the exchange is entitled to receive.
Notwithstanding the foregoing and except as otherwise provided
in or pursuant to this Indenture, any Global Security shall be exchangeable
pursuant to this Section or Sections 3.4, 3.6, 9.5, and 11.7 for Securities
registered in the name of, and a transfer of a Global Security of any series may
be registered to, any Person other than the Depository for such Security or its
nominee only if (i) such Depository notifies the Company that it is unwilling or
unable to continue as Depository for such Global Security or if at any time such
Depository ceases to be a clearing agency registered under the Securities
Exchange Act of 1934, as amended, and the Company within 90 days after receiving
such notice or becoming aware that the Depository is no longer so registered,
does not appoint a successor Depository for such Global Security; (ii) the
Company executes and delivers to the Trustee a Company Order to the effect that
such Global Security shall be so exchangeable and the transfer thereof so
registrable; or (iii) there shall have occurred and be continuing with respect
to the Securities of such series, an Event of Default or an event which after
notice or lapse of time would be an Event of Default. Upon the occurrence in
respect of any Global Security of any series of any one or more of the
conditions specified in clauses (i), (ii), or (iii) of the preceding sentence or
such other conditions as may be specified as contemplated by Section 3.1 for
such series, (A) such Global Security may be exchanged in accordance with the
foregoing provisions of this Section for a Security which is not a Global
Security and (B) in accordance with the foregoing provisions of this Section the
transfer of such Global Security may be registered to such Persons (including
Persons other than the Depository with respect to such series and its nominees)
as such Depository shall designate. Notwithstanding any other provision of this
Indenture, any Security authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, any Global Security shall also
be a Global Security except for any Security authenticated
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and delivered in exchange for, or upon registration of transfer of, a Global
Security pursuant to the preceding sentence.
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitling the Holders thereof to the same benefits under this
Indenture, as the Securities surrendered upon such registration of transfer or
exchange.
Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Trustee or
the Security Registrar for such series of Securities) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar (and, if so required by the Trustee, to the
Trustee) duly executed, by the Holder thereof or his attorney duly authorized in
writing.
No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges expressly provided in this Indenture to be made at the
Company's own expense or without expense or without charge to Holders.
The Company shall not be required (i) to issue, register the
transfer of or exchange any Security of any series during a period beginning at
the opening of business 15 days before the day of the mailing of a notice of
redemption of Securities of that series selected for redemption under Section
11.3 and ending at the close of business on the day of such mailing, or (ii) to
register the transfer of or exchange any Security so selected for redemption in
whole or in part, except the unredeemed portion of any Security being redeemed
in part.
SECTION 3.6 Mutilated, Destroyed, Lost and Stolen Securities.
If there shall be delivered to the Company and the Trustee (i)
a mutilated Security or evidence to their satisfaction of the destruction, loss
or theft of any Security and (ii) such security or indemnity as may be required
by them to save each of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Security, a new Security of the same series and of
like tenor and principal amount and bearing a number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
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Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this
Section in lieu of any destroyed, lost or stolen Security shall constitute an
original additional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities of that series duly issued
hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.7 Payment of Interest; Interest Rights Preserved.
Except as otherwise provided or contemplated by Section 3.1
with respect to any series of Securities, interest on any Security which is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest.
Any interest on any Security of any series which is payable,
but is not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be payable to the
Holder thereof on the relevant Regular Record Date by virtue of having been such
Holder, and such Defaulted Interest may be paid by the Company, at its election
in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such series
(or their respective Predecessor Securities) are registered at the
close of business on a Special Record Date for the payment of such
Defaulted Interest, which shall be fixed in the following manner. The
Company shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Security of such series and the
date of proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited to
be held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this Clause provided. Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted
Interest which
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shall be not more than 15 days and not less than 10 days prior to the
date of the proposed payment and not less than 10 days after the
receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special Record Date
and, in the name and at the expense of the Company, shall cause notice
of the proposed payment of such Defaulted Interest and the Special
Record Date therefor to be mailed, first-class postage prepaid, to each
Holder of Securities of such series at his address as it appears in the
Security Register, not less than 10 days prior to such Special Record
Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been so mailed, such Defaulted
Interest shall be paid to the Persons in whose names the Securities of
such series (or their respective Predecessor Securities) are registered
at the close of business on such Special Record Date and shall no
longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on
the Securities of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange on which
the Securities may be listed, and upon such notice as may be required
by such exchange, if, after notice given by the Company to the Trustee
of the proposed payment pursuant to this Clause, such manner of payment
shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
SECTION 3.8 Persons Deemed Owners.
The Company, the Trustee, any Paying Agent, any Authenticating
Agent and any other agent of the Company or the Trustee may treat the Person in
whose name such Security is registered as the owner of such Security for the
purpose of receiving payment of principal of (and premium, if any) and (subject
to Section 3.7) interest on such Security and for all other purposes whatsoever,
whether or not any payment with respect to such Security be overdue, and neither
the Company, the Trustee, any Paying Agent, any Authenticating Agent nor any
other agent of the Company or the Trustee shall be affected by notice to the
contrary.
None of the Company, the Trustee, any Paying Agent, any
Authenticating Agent, or any other agent of the Company or the Trustee will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in a Global Security
or for maintaining, supervising or reviewing any records relating to such
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beneficial ownership interests, and they shall be fully protected in acting or
refraining from acting on any information provided by the Depository.
Notwithstanding the foregoing, with respect to any Global
Security, nothing herein shall prevent the Company, the Trustee, any Paying
Agent, any Authenticating Agent, or any other agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by a Depository or impair the operation of customary
practices governing the exercise of the rights of the Depository (or its
nominee) as Holder of such Global Security.
SECTION 3.9 Cancellation.
All Securities surrendered for payment, redemption,
registration of transfer or exchange, or for credit against any sinking fund
payment shall, if surrendered to the Company, the Security Registrar, any Paying
Agent, any Authenticating Agent or any other agent of the Company, be delivered
to the Trustee and, if not already canceled, shall be promptly canceled by it.
The Company may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and all Securities so delivered
shall be promptly canceled by the Trustee. No Security shall be authenticated in
lieu of or in exchange for any Securities canceled as provided in this Section,
except as expressly permitted by this Indenture. All canceled Securities held by
the Trustee shall be destroyed unless otherwise directed by a Company Order and
a certificate of such destruction shall be delivered to the Company and to the
Trustee.
SECTION 3.10 Computation of Interest.
Except as otherwise specified as contemplated by Section 3.1
for Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
ARTICLE 4
SATISFACTION AND DISCHARGE
SECTION 4.1 Satisfaction and Discharge of Securities of any Series.
The Company shall be deemed to have satisfied and discharged
the entire indebtedness on all the Securities of any particular series and the
Trustee, upon Company request
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and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of such indebtedness, when
(1) Either
(A) All Securities of such series theretofore authenticated
and delivered (other than (i) Securities of such series which have been
destroyed, lost or stolen and which have been replaced or paid as
provided in Section 3.6 and (ii) Securities of such series for whose
payment money has theretofore been deposited in trust or segregated and
held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in the last paragraph of
Section 10.3) have been delivered to the Trustee canceled or for
cancellation; or
(B) All such Securities of such series not theretofore
delivered to the Trustee canceled or for cancellation
(i) Have become due and payable, or
(ii) Will become due and payable at their Stated
Maturity within one year, or
(iii) Are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the giving
of notice of redemption by the Trustee in the name, and at the
expense, of the Company,
and the Company, in the case of (i), (ii), or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose money in an amount sufficient to pay and
discharge the entire indebtedness on such Securities not theretofore
delivered to the Trustee canceled or for cancellation, including the
principal of (and premium, if any) and interest on such Securities to
the date of such deposit (in the case of Securities which have become
due and payable) or to the Stated Maturity or Redemption Date, as the
case may be;
(2) The Company has paid or caused to be paid all other sums
payable with respect to the Securities of such series;
(3) The Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and
discharge of the entire indebtedness on all Securities of such series
have been complied with.
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SECTION 4.2 Satisfaction and Discharge of Indenture.
Upon compliance by the Company with the provisions of Section
4.1 as to the satisfaction and discharge of each series of Securities issued
hereunder, this Indenture shall cease to be of any further effect (except as
otherwise provided herein). Upon Company Request (and at the expense of the
Company), the Trustee shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture. In the event there are two or more
Trustees hereunder, then the effectiveness of any such instrument shall be
conditioned upon receipt of such instruments from all Trustees hereunder.
Notwithstanding the satisfaction and discharge of this
Indenture, any obligations of the Company under Sections 6.6 and 6.11 and of the
Trustee under Section 4.3 and the last paragraphs of Section 10.3 and Section
13.5, shall survive, and any obligations of the Company under Sections 3.5, 3.6,
6.8, and 10.2 with respect to the Securities of a series shall survive until the
Maturity of such series.
SECTION 4.3 Application of Trust Money.
Subject to the provisions of the last paragraph of Section
10.3, all money deposited with the Trustee pursuant to Section 4.1 shall be held
in trust and applied by it to the payment, either directly or through any Paying
Agent (including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of all sums due and to become due
with respect to Securities for which such money has been deposited for principal
(and premium, if any) and interest; but such money need not be segregated from
other funds except to the extent required by law.
ARTICLE 5
REMEDIES
SECTION 5.1 Events of Default; Defaults.
"Event of Default," wherever used herein, with respect to
Securities of any series means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) Default in the payment of any interest on any Security of
that series when it becomes due and payable, and continuance of such
default for a period of 30 days; or
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(2) Default in the payment of the principal of (or premium, if
any, on) any Security of that series at its Maturity; or
(3) Default in the deposit of any sinking fund payment, when
and as due by the terms of a Security of that series; or
(4) Default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or
warranty a default in the performance or the breach of which is
elsewhere in this Section specifically dealt with or which has
expressly been included in this Indenture solely for the benefit of a
series of Securities other than that series), and continuance of such
default or breach for a period of 90 days after there has been given,
by registered or certified mail, to the Company by the Trustee or to
the Company and the Trustee by the Holders of at least 25 percent in
principal amount of the Outstanding Securities of that series, a
written notice specifying such default or breach and requiring it to be
remedied and stating that such notice is a "Notice of Default"
hereunder; or
(5) The entry by a court having jurisdiction in the premises
of (A) a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable federal or state
bankruptcy, insolvency, reorganization or other similar law or (B) a
decree or order adjudging the Company a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company
under any applicable federal or state law, or appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or
ordering the winding-up or liquidation of its affairs, and the
continuance of any such decree or order unstayed and in effect for a
period of 60 consecutive days; or
(6) The commencement by the Company of a voluntary case or
proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or of any other case or
proceeding to be adjudicated a bankrupt or insolvent, or the consent by
the Company to the entry of a decree or order for relief in an
involuntary case or proceeding under any applicable federal or state
bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against
it, or the filing by the Company of a petition or answer or consent
seeking reorganization or relief under any applicable federal or state
law, or the consent by the Company to the filing of such petition or to
the appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or similar official of the
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Company or of any substantial part of its property, or the making by
the Company of an assignment for the benefit of creditors, or the
admission by the Company in writing of its inability to pay its debts
generally as they become due, or the taking of corporate action by the
Company in furtherance of any such action; or
(7) Any other Event of Default provided pursuant to Section
3.1 with respect to Securities of that series.
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any
series at the time Outstanding occurs and is continuing, then and in every such
case the Trustee or the Holders of not less than 25 percent in principal amount
of the Outstanding Securities of that series may declare the principal (or, if
the Securities of that series are Original Issue Discount Securities, such
portion of the principal as may be specified in the terms of that series) of all
the Securities of that series to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), and upon any
such declaration such principal (or specified portion thereof) shall become
immediately due and payable. Payment of principal and interest on such
Securities shall remain subordinated to the extent provided in Article XIV
notwithstanding that such amount shall become immediately due and payable as
herein provided. Upon payment of such amount, all obligations of the Company in
respect of the payment of principal of the Securities of such series shall
terminate.
At any time after such a declaration of acceleration with
respect to Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter in this Article provided, the Holders of not less than a majority in
principal amount of the Outstanding Securities of that series, by written notice
to the Company and the Trustee, may rescind and annul such declaration and its
consequences if
(1) The Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) All overdue installments of interest on all
Securities of that series,
(B) The principal of (and premium, if any, on) any
Securities of that series which have become due otherwise than
by such declaration of acceleration and interest thereon at
the rate or rates borne by or provided for in such Securities,
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(C) To the extent that payment of such interest is
lawful, interest upon overdue installments of interest at the
rate or rates borne by or provided for in such Securities, and
(D) All sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel; and
(2) All Events of Default with respect to Securities of that
series, other than the nonpayment of the principal of Securities of
that series which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if
(1) Default is made in the payment of any installment of
interest on any Security of any series when such interest becomes due
and payable and such default continues for a period of 30 days, or
(2) Default is made in the payment of the principal of (or
premium, if any, on) any Security of any series at the Maturity
thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of Securities of such series, the whole amount then due and payable on
Securities of such series for principal (and premium, if any) and interest, with
interest upon the overdue principal (and premium, if any) and, to the extent
that payment of such interest shall be legally enforceable, upon overdue
installments of interest, at the rate or rates borne by or provided for in such
Securities; and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any other obligor upon such Securities
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon such
Securities, wherever situated.
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If an Event of Default with respect to Securities of any
series occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of the Securities
of such series by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or such
Securities or in aid of the exercise of any power granted herein or therein, or
to enforce any other proper remedy.
SECTION 5.4 Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of any overdue principal, premium or interest) shall
be entitled and empowered, by intervention in such proceeding or otherwise,
(i) To file and prove a claim for the whole amount of
principal (or with respect to Original Issue Discount Securities, such
portion of the principal amount as may be specified in the terms of
such Securities), and premium, if any, and interest owing and unpaid in
respect of the Securities and to file such other papers or documents as
may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and
of the Holders allowed in such judicial proceeding, and
(ii) To collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 6.6.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
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SECTION 5.5 Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
SECTION 5.6 Application of Money Collected.
Any money collected by the Trustee pursuant to this Article
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal
(or premium, if any) or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee and any
predecessor Trustee under Section 6.6;
SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the Securities in
respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Securities for
principal (and premium, if any) and interest, respectively; and
THIRD: The balance, if any, to the Person or Persons entitled
thereto.
SECTION 5.7 Limitation on Suits.
No Holder of any Security of any series shall have any right
to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(1) Such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to Securities of
that series;
(2) The Holders of not less than 25 percent in principal
amount of the Outstanding Securities of that series shall have made
written request to
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the Trustee to institute proceedings in respect of such Event of
Default in its own name as Trustee hereunder;
(3) Such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) The Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) No direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority in principal amount of the Outstanding Securities of that
series;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture or any Security to affect, disturb or prejudice the rights of any
other such Holders or Holders of Securities of any other series, or to obtain or
to seek to obtain priority or preference over any other Holders or to enforce
any right under this Indenture, except in the manner herein provided and for the
equal and ratable benefit of all the Holders.
SECTION 5.8 Unconditional Right of Holders to Receive Principal, Premium
and Interest; Direct Action by Holders of Willamette Trust
Securities.
Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Section 3.7) interest, if any, on such Security on the respective
Stated Maturities specified in such Security (or, in the case of redemption, on
the Redemption Date) and to institute suit for the enforcement of any such
payment, and such right shall not be impaired without the consent of such
Holder. In the case of Securities of a series issued to a Willamette Trust, any
holder of the corresponding series of Willamette Trust Securities issued by such
Willamette Trust shall have the right, upon the occurrence of an Event of
Default described in Section 5.1(1) or 5.1(2), to institute a suit directly
against the Company for enforcement of payment to such holder of principal of
(premium, if any) and (subject to Section 3.7) interest on the Willamette Trust
Securities having a principal amount equal to the aggregate Liquidation Amount
(as defined in the Trust Agreement under which such Willamette Trust is formed)
of such Willamette Trust Securities of the corresponding series held by such
holder. In the case of Securities of a series issued to a Willamette Trust, the
holders of a specified percentage of the corresponding series of Willamette
Trust Securities shall have right to direct the taking of certain actions as
provided in the applicable trust agreement governing such Willamette Trust.
SECTION 5.9 Restoration of Rights and Remedies.
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If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
SECTION 5.10 Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 3.6, no right or remedy herein conferred upon or reserved
to the Trustee or to the Holders is intended to be exclusive of any other right
or remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
SECTION 5.11 Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any
Security to exercise any right or remedy accruing upon any Event of Default
shall impair any such right or remedy or constitute a waiver of any such Event
of Default or an acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by the Holders,
as the case may be.
SECTION 5.12 Control by Holders.
The Holders of a majority in principal amount of the
Outstanding Securities of any series shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee, with respect
to the Securities of such series, provided that
(1) Such direction shall not be in conflict with any rule of
law, with this Indenture or with the Securities of any such series; and
(2) The Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
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SECTION 5.13 Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of
the Outstanding Securities of any series may, on behalf of the Holders of all
the Securities of such series, waive any past default hereunder with respect to
such series and its consequences, except a default
(1) In the payment of the principal of (or premium, if any) or
interest, if any, on any Security of such series; or
(2) In respect of a covenant or provision hereof which under
Article 9 cannot be modified or amended without the consent of the
Holder of each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
SECTION 5.14 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered, or omitted by it as Trustee, a court may require any party litigant in
such suit to file an undertaking to pay the costs of such suit, and may assess
costs against any such party litigant, in the manner and to the extent provided
in the Trust Indenture Act; provided that neither this Section nor the Trust
Indenture Act shall be deemed to authorize any court to require such an
undertaking or to make such an assessment in any suit instituted by the Company.
SECTION 5.15 Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
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ARTICLE 6
THE TRUSTEE
SECTION 6.1 Certain Rights of Trustee.
Subject to Sections 315(a) through 315(d) of the Trust
Indenture Act:
(a) The Trustee may rely and shall be 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
or presented by the proper party or parties;
(b) Any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order
(in each case, other than delivery of any Security to the Trustee for
authentication and delivery pursuant to Section 3.3, which shall be
sufficiently evidenced as provided therein) and any resolution of the
Board of Directors may be sufficiently evidenced by a Board Resolution;
(c) Whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may,
in the absence of bad faith on its part, rely upon an Officers'
Certificate;
(d) The Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
(e) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by or pursuant to this Indenture
at the request or direction of any of the Holders pursuant to this
Indenture, unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction;
(f) The 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,
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but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation,
it shall be entitled to examine, during business hours and upon
reasonable notice, the books, records and premises of the Company,
personally or by agent or attorney;
(g) The 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 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 or for any misconduct or
negligence on the part of any Authenticating Agent; and
(h) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to
it.
SECTION 6.2 Notice of Defaults.
Within 90 days after the occurrence of any default hereunder
with respect to the Securities of any series, the Trustee shall transmit by mail
to all Holders of Securities of such series, as their names and addresses appear
in the Security Register, notice of such default hereunder known to the Trustee,
unless such default shall have been cured or waived; provided, however, that
except in the case of a default in the payment of the principal of (or premium,
if any) or interest, if any, on any Security of such series or in the payment of
any sinking fund installment with respect to Securities of such series, the
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
or Responsible Officers of the Trustee in good faith determines that the
withholding of such notice is in the interest of the Holders of Securities of
such series; and provided, further, that in the case of any default of the
character specified in Section 5.1(4) with respect to Securities of such series,
no such notice to Holders shall be given until at least 60 days after the
occurrence thereof. For the purpose of this Section, the term "default" means
any event which is, or after notice or lapse of time or both would become, an
Event of Default with respect to Securities of such series.
SECTION 6.3 Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except in
the certificates of authentication, shall be taken as the statements of the
Company, and neither the Trustee nor any
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Authenticating Agent assumes any responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Securities, except that the Trustee represents that it is
duly authorized to execute and deliver this Indenture, authenticate the
Securities and perform its obligations hereunder and that the statements made by
it in a Statement of Eligibility and Qualification on Form T-1 supplied to the
Company are true and accurate, subject to the qualifications set forth therein.
Neither the Trustee nor any Authenticating Agent shall be accountable for the
use or application by the Company of the Securities or the proceeds thereof.
SECTION 6.4 May Hold Securities.
The Trustee, any Paying Agent, Authenticating Agent, Security
Registrar or any other agent of the Trustee or the Company, in its individual or
any other capacity, may become the owner or pledgee of Securities and, subject
to Sections 310(b) and 3011 of the Trust Indenture Act, may otherwise deal with
the Company with the same rights it would have if it were not Trustee, Paying
Agent, Authenticating Agent, Security Registrar or such other agent.
SECTION 6.5 Money Held in Trust.
Except as provided in Section 10.3, money held by the Trustee
or any Paying Agent in trust hereunder need not be segregated from other funds
except to the extent required by law. Neither the Trustee nor any Paying Agent
shall be under any liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.
SECTION 6.6 Compensation and Reimbursement.
The Company agrees:
(1) To pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(2) Except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel and any Authenticating Agent), except any such
expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(3) To indemnify the Trustee and its agents for, and to hold
them harmless against, any loss, liability or expense incurred without
negligence
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or bad faith on their part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder,
including the costs and expenses of defending themselves against any
claim or liability in connection with the exercise or performance of
any of their powers or duties hereunder.
As security for the performance of the obligations of the
Company under this Section, the Trustee shall have a lien prior to the
Securities upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the payment of principal of (and premium, if any)
or interest on Securities.
SECTION 6.7 Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be
a corporation permitted by the Trust Indenture Act to act as trustee under an
indenture qualified under the Trust Indenture Act and that has a combined
capital and surplus (which may be determined pursuant to Section 310(a)(2) of
the Trust Indenture Act) of at least $20,000,000. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article.
SECTION 6.8 Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee under
Section 6.9.
(b) The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Company. If an instrument of acceptance by a successor Trustee shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Securities of such series, delivered to the Trustee and to
the Company.
(d) If at any time:
(1) The Trustee shall cease to be eligible under Section 6.7
and shall fail to resign after written request therefor by the Company
or by any Holder who has been a bona fide Holder of a Security of such
series for at least six months; or
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(2) The Trustee shall (a) become incapable of acting with
respect to any series of Securities or (b) be adjudged a bankrupt or
insolvent or a receiver of the Trustee or of its property shall be
appointed or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;
then, in any such case, (i) the Company by or pursuant to a Board Resolution may
remove the Trustee with respect, in the case of (a) above, to the Securities of
such series, and, in the case of (b) above, to all Securities or (ii) any Holder
who has been a bona fide Holder, in the case of (a) above, of a Security of such
series and, in the case of (b) above, of any security, for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee and the appointment of
a successor Trustee with respect to such series or all Securities, as the case
may be.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, with respect to the Securities of one or more series, the Company, by
or pursuant to a Board Resolution, shall promptly appoint a successor Trustee or
Trustees with respect to the Securities of that or those series (it being
understood that any such successor Trustee may be appointed with respect to the
Securities of one or more or all of such series and that at any time there shall
be only one Trustee with respect to the Securities of any particular series) and
shall comply with the applicable requirements of Section 6.9. If, within one
year after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee with respect to the Securities of any series shall
be appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
6.9, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any series shall have
been so appointed by the Company or the Holders of Securities of such series and
accepted appointment in the manner required by Section 6.9, any Holder who has
been a bona fide Holder of a Security of such series for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
by mailing written notice of such event by first-class mail, postage prepaid, to
all Holders of Securities of such series as their names and addresses appear in
the Security Register. Each notice shall include the name of the successor
Trustee with respect to the Securities of such series and the address of its
Corporate Trust Office.
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SECTION 6.9 Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor
Trustee with respect to all Securities, such successor Trustee so appointed
shall execute, acknowledge and deliver to the Company and to the retiring
Trustee an instrument accepting such appointment, and thereupon the resignation
or removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee; but, on the
request of the Company or the successor Trustee, such retiring Trustee shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Trustee all the rights, powers and trusts of the retiring Trustee
and shall duly assign, transfer and deliver to such successor Trustee all
property and money held by such retiring Trustee hereunder, subject nevertheless
to its claim, if any, provided for in Section 6.6.
(b) In case of the appointment hereunder of a successor
Trustee with respect to the Securities of one or more (but not all) series, the
Company, the retiring Trustee and each successor Trustee with respect to the
Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment
and which (1) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates, (2) if the retiring Trustee is not retiring with respect to all
Securities, shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series as to
which the retiring Trustee is not retiring shall continue to be vested in the
retiring Trustee, and (3) shall add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Trustee, it being understood that
nothing herein or in such supplemental indenture shall constitute such Trustees
co-trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and, upon the execution and delivery of
such supplemental indenture, the resignation or removal of the retiring Trustee
shall become effective to the extent provided therein, such retiring Trustee
shall, with respect to the Securities of that or those series to which the
appointment of such successor Trustee relates, have no further responsibility
for the exercise of rights and powers or for the performance of the duties and
obligations vested in the Trustee under this Indenture other than as hereinafter
set forth, and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates, subject
nevertheless to its claim, if any, provided for in Section 6.6.
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(c) Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts
referred to in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article.
SECTION 6.10 Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
SECTION 6.11 Appointment and Qualification of Authenticating Agent.
At any time when any of the Securities remain Outstanding, the
Trustee may appoint an Authenticating Agent or Agents with respect to one or
more series of Securities which shall be authorized to act on behalf of the
Trustee to authenticate and deliver Securities of that or those series issued
upon original issue, exchange, registration of transfer or partial redemption
thereof or pursuant to Section 3.6, and Securities so authenticated and
delivered shall be entitled to the benefits of this Indenture and shall be valid
and obligatory for all purposes as if authenticated and delivered by the Trustee
hereunder. Wherever reference is made in this Indenture to the authentication
and delivery of Securities by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each such Authenticating Agent shall be acceptable to the
Company and shall at all times be a corporation that would be permitted by the
Trust Indenture Act to act as trustee under an indenture qualified under the
Trust Indenture Act, is authorized under applicable law and its charter to act
as an Authenticating Agent and has a combined capital and surplus (which may be
determined pursuant to Section 310(a)(2) of the Trust Indenture Act) of at least
$20,000,000. If at any time an Authenticating Agent shall cease to be eligible
in accordance with the provisions of this Section, such Authenticating Agent
shall resign immediately in the manner and with the effect specified in this
Section.
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Any corporation into which any Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which any
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of any Authenticating Agent, shall
continue to be the Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating Agent.
Any Authenticating Agent may resign at any time by giving
written notice of resignation to the Trustee and to the Company. The Trustee at
any time may, or in case at any time any Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section, the Trustee promptly
shall, terminate the agency of any Authenticating Agent by giving written notice
of termination to such Authenticating Agent and to the Company. Upon such a
resignation or termination, the Trustee may appoint a successor Authenticating
Agent which must be acceptable to the Company and shall mail notice of such
appointment to all Holders of Securities of the series with respect to which
such Authenticating Agent will serve as the names and addresses of such Holders
appear in the Security Register. Any successor Authenticating Agent, upon
acceptance of its appointment hereunder, shall become vested with all the
rights, powers, duties and responsibilities of its predecessor hereunder, with
like effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless eligible under the provisions of
this Section.
The Trustee agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services under this Section, and
the Trustee shall be entitled to reimbursement for such payments in accordance
with the provisions of Section 6.6. The provisions of Sections 1.4, 3.8, 6.1,
6.3, and 6.6(3) shall also be applicable to any Authenticating Agent.
If an appointment with respect to one or more series of
Securities is made pursuant to this Section, the Securities of such series may
have endorsed thereon, in addition to or in lieu of the Trustee's certificate of
authentication, an alternate certificate of authentication in the following
form:
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This is one of the Securities of the series designated herein
referred to in the within-mentioned Indenture.
------------------------------------------,
as Trustee
By ---------------------------------------
as Authenticating Agent
for the Trustee
By ---------------------------------------
Authorized Officer
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 7.1 Company to Furnish Trustee Names and Addresses of Holders.
In accordance with Section 312(a) of the Trust Indenture Act,
the Company will furnish or cause to be furnished to the Trustee with respect to
the Securities of each series (a) semi-annually, either (i) not later than June
30 and December 31 in each year in the case of Original Issue Discount
Securities which by their terms bear interest only after Maturity, or (ii) not
later than 15 days after each Regular Record Date in the case of Securities of
any other series, if and so long as Securities of such series are Outstanding,
and (b) at such other times as the Trustee may request in writing, within 30
days after receipt by the Company of any such request, a list in such form as
the Trustee may reasonably require containing all the information in the
possession or control of the Company, or any of its Paying Agents other than the
Trustee, as to the names and addresses of the Holders of such series; provided,
however, that no such list need be furnished if the Trustee shall be the
Security Registrar. Any such list shall be dated as of a date not more than 15
days prior to the time such information is furnished or caused to be furnished
and need not include information received after such date; provided, however,
that with respect to any list furnished pursuant to subclause (a)(ii) above, any
such list shall be dated as of the Regular Record Date.
SECTION 7.2 Preservation of Information; Communications to Holders.
The Trustee shall comply with the obligations imposed upon it
pursuant to Section 312 of the Trust Indenture Act.
Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any Paying Agent nor
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any Security Registrar shall be held accountable by reason of the disclosure of
any such information as to the names and addresses of the Holders in accordance
with Section 312 of the Trust Indenture Act, regardless of the source from which
such information was derived, and that the Trustee shall not be held accountable
by reason of mailing any material pursuant to a request made under Section
312(b) of the Trust Indenture Act.
SECTION 7.3 Reports by Trustee.
(a) Within 60 days after February 1 of each year, if required
by Section 313(a) of the Trust Indenture Act, the Trustee shall transmit,
pursuant to Section 313(c) of the Trust Indenture Act, a brief report dated as
of such -------------- with respect to any of the events specified in said
Section 313(a) which may have occurred since the later of the immediately
preceding -------------- and the date of this Indenture.
(b) The Trustee shall transmit the reports required by Section
313(b) of the Trust Indenture Act at the times specified therein.
(c) Reports pursuant to this Section shall be transmitted in
the manner and to the Persons required by Sections 313(c) and 313(d) of the
Trust Indenture Act.
SECTION 7.4 Reports by Company.
The Company, pursuant to Section 314(a) of the Trust Indenture
Act, shall:
(1) File with the Trustee, within 15 days after the Company is
required to file the same with the Commission, copies of the annual
reports and of the information, documents and other reports (or copies
of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) which the Company may
be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934; or, if the
Company is not required to file information, documents or reports
pursuant to either of said Sections, then it shall file with the
Trustee and the Commission, in accordance with rules and regulations
prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports which may
be required pursuant to Section 13 of the Securities Exchange Act of
1934 in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in such
rules and regulations;
(2) File with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the
Commission, such additional information, documents and reports with
respect to compliance by
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the Company with the conditions and covenants of this Indenture as may
be required from time to time by such rules and regulations; and
(3) Transmit to the Holders within 30 days after the filing
thereof with the Trustee, in the manner and to the extent provided in
Section 313(c) of the Trust Indenture Act, such summaries of any
information, documents and reports required to be filed by the Company
pursuant to paragraphs (1) and (2) of this Section as may be required
by rules and regulations prescribed from time to time by the
Commission.
ARTICLE 8
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 8.1 Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other
corporation or convey, transfer, or lease its properties and assets
substantially as an entirety to any Person, and the Company shall not permit any
Person to consolidate with or merge into the Company or to convey, transfer, or
lease its properties and assets substantially as an entirety to the Company,
unless:
(1) In case the Company shall consolidate with or merge into
another corporation or convey, transfer, or lease its properties and
assets substantially as an entirety to any Person, the corporation
formed by such consolidation or into which the Company is merged or the
Person which acquires by conveyance or transfer, or which leases, the
properties and assets of the Company substantially as an entirety shall
be a corporation organized and existing under the laws of the United
States, any State thereof, or the District of Columbia and shall
expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, the due
and punctual payment of the principal of (and premium, if any) and
interest, if any, on all the Securities and the performance of every
covenant of this Indenture on the part of the Company to be performed
or observed;
(2) Immediately after giving effect to such transaction and
treating any indebtedness which becomes an obligation of the Company or
a Subsidiary as a result of such transaction as having been incurred by
the Company or the Subsidiary at the time of such transaction, no Event
of Default, and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have happened and be
continuing;
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(3) If, as a result of any such consolidation or merger or
such conveyance, transfer or lease, properties or assets of the Company
would become subject to a mortgage, pledge, lien, security interest or
other encumbrance which would not be permitted by Section 10.5, the
Company or such successor corporation, as the case may be, shall take
such steps as shall be necessary effectively to secure the Securities
equally and ratably with (or prior to) all indebtedness secured
thereby; and
(4) Either the Company or the successor corporation shall have
delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel, each stating that such consolidation, merger (other than a
merger with a Restricted Subsidiary in which the Company is the
surviving corporation), conveyance, transfer, or lease and, if a
supplemental indenture is required in connection with such transaction,
such supplemental indenture comply with this Article and that all
conditions precedent herein provided for relating to such transaction
have been complied with.
SECTION 8.2 Successor Corporation Substituted.
Upon any consolidation or merger or any conveyance, transfer
or lease of the properties and assets of the Company substantially as an
entirety in accordance with Section 8.1, the successor corporation formed by
such consolidation or into which the Company is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture with
the same effect as if such successor corporation had been named as the Company
herein; and thereafter, except in the case of a lease, the predecessor
corporation shall be released from all obligations and covenants under this
Indenture and the Securities.
ARTICLE 9
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company (when
authorized by or pursuant to a Board Resolution) and the Trustee, at any time
and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the following purposes:
(1) To evidence the succession of another corporation to the
Company and the assumption by any such successor of the covenants of
the Company herein and in the Securities; or
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(2) To add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities (and if such covenants
are to be for the benefit of less than all series of Securities,
stating that such covenants are expressly being included solely for the
benefit of such series) or to surrender any right or power herein
conferred upon the Company; or
(3) To add any additional Events of Default with respect to
all or any series of Securities (as shall be specified in such
supplemental indenture); or
(4) To add to or change any of the provisions of this
Indenture to such extent as shall be necessary to permit or facilitate
the issuance of Securities in bearer form, registrable or not
registrable as to principal, and with or without interest coupons; or
(5) To change or eliminate any of the provisions of this
Indenture, provided that any such change or elimination shall become
effective only when there is no Security Outstanding of any series
created prior to the execution of such supplemental indenture which is
entitled to the benefit of such provision; or
(6) To secure the Securities; or
(7) To establish the form or terms of Securities of any series
as permitted by Sections 2.1 and 3.1; or
(8) To evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one
or more series and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee,
pursuant to the requirements of Section 6.9; or
(9) To identify indebtedness constituting Senior Debt as
contemplated by Section 1.1; or
(10) To cure any ambiguity, to correct or supplement any
provision herein which may be defective or inconsistent with any other
provision herein, or to make any other provisions with respect to
matters or questions arising under this Indenture, provided such action
shall not adversely affect the interests of the Holders of Securities
of any series in any material respect.
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SECTION 9.2 Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company (when authorized by or pursuant to a Board Resolution) and
the Trustee may enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture or of modifying in any manner the rights
of the Holders of Securities of such series under this Indenture; provided,
however, that no such supplemental indenture shall, without the consent of the
Holder of each Outstanding Security affected thereby,
(1) Change the Stated Maturity of the principal of, or any
premium or installment of interest on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or any premium
payable upon redemption thereof, or reduce the amount of the principal
of an Original Issue Discount Security that would be due and payable
upon a declaration of acceleration of the Maturity thereof pursuant to
Section 5.2, or change the Place of Payment where, or the coin or
currency in which, any Security or any premium or the interest thereon
is payable, or impair the right to institute suit for the enforcement
of any such payment on or after the Stated Maturity thereof (or, in the
case of redemption, on or after the Redemption Date) or change the
provisions made for the defeasance of any Security or the defeasance of
any covenant applicable to any Security; or
(2) Reduce the percentage in principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver (of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture; or
(3) Modify any of the provisions of this Section, Section 5.13
or Section 10.9, except to increase any such percentage or to provide
that certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each Outstanding Security
affected thereby.
A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which has expressly been included
solely for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series.
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It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
SECTION 9.3 Execution of Supplemental Indentures.
As a condition to executing, or accepting the additional
trusts created by, any supplemental indenture permitted by this Article or the
modifications thereby of the trusts created by this Indenture, the Trustee shall
be entitled to receive, and (subject to Section 315 of the Trust Indenture Act)
shall be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture and that such supplemental indenture, when executed and delivered by
the Company, will constitute a valid and binding obligation of the Company in
accordance with its terms. The Trustee may, but shall not be obligated to, enter
into any such supplemental indenture which affects the Trustee's own rights,
duties or immunities under this Indenture or otherwise.
SECTION 9.4 Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of an Security theretofore or thereafter authenticated and
delivered hereunder shall be bound thereby.
SECTION 9.5 Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series without charge to
the Holders.
ARTICLE 10
COVENANTS
SECTION 10.1 Payment of Principal, Premium and Interest.
The Company will duly and punctually pay the principal of (and
premium, if any) and interest, if any, on the Securities of each series in
accordance with the terms of the Securities of such series and this Indenture.
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SECTION 10.2 Maintenance of Office or Agency.
The Company will maintain an office or agency in each Place of
Payment for any series of Securities where Securities of that series may be
presented or surrendered for payment, where Securities of that series may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities of that series and
this Indenture may be served. The Company will give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency. Unless otherwise designated by the Company in written notice to the
Trustee, the Place of Payment shall be the Borough of Manhattan, City of New
York, New York, and such office or agency in such Place of Payment shall be the
Corporate Trust Office of the Trustee therein. If at any time the Company shall
fail to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee and,
effective at that time, the Company hereby appoints the Trustee as its agent to
receive all presentations, surrenders, notices and demands under this Indenture.
The Company may also from time to time designate one or more
other offices or agencies (in or outside the Borough of Manhattan, City of New
York, New York) where the Securities of one or more series may be presented or
surrendered for any of or all the purposes specified above in this Section, and
may from time to time rescind such designations; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or agency in each Place of Payment for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other
office or agency.
SECTION 10.3 Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent
with respect to any series of Securities, it will, on or before each due date of
the principal of (and premium, if any) or interest on any of the Securities of
that series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay such principal (and premium, if any) or interest
so becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided, and will promptly notify the Trustee of its
action or failure so to act.
Whenever the Company shall have one or more Paying Agents for
any series of Securities, it will, on or prior to each due date of the principal
of (and premium, if any) or interest on any Securities of that series, deposit
with any Paying Agent for that series a sum sufficient to pay such principal
(and premium, if any) or interest so becoming due, such sum to be held in trust
for the benefit of the Persons entitled thereto and (unless such Paying Agent is
the Trustee) the Company will promptly notify the Trustee of its action or
failure so to act.
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The Company will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(1) Hold all sums held by it for the payment of the principal
of (and premium, if any) or interest on Securities of that series in
trust for the benefit of the Persons entitled thereto until such sums
shall be paid to such Persons or otherwise disposed of as herein
provided;
(2) Give the Trustee notice of any default by the Company (or
any other obligor upon the Securities of that series) in the making of
any payment of principal (and premium, if any) or interest on the
Securities of that series; and
(3) At any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of (and
premium, if any) or interest on any Security of any series and remaining
unclaimed for two years after such principal (and premium, if any) or interest
has become due and payable shall be paid to the Company on Company Request, or
(if then held by the Company) shall be discharged from such trust; and the
Holder of such Security shall thereafter, as an unsecured general creditor, look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company, mail to the Holders at their addresses as set
forth in the Security Register, or cause to be published once, in a newspaper
published in the English language, customarily published on each Business Day
and of general circulation at each Place of Payment with respect to Securities
of such series, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication or mailing, any unclaimed balance of such money then remaining will
be repaid to the Company.
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SECTION 10.4 Corporate Existence.
Subject to Article 8, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect its corporate
existence, rights (charter and statutory) and material franchises; provided,
however, that the Company shall not be required to preserve any such right or
franchise if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
that the loss thereof is not disadvantageous in any material respect to the
Holders.
SECTION 10.5 Restrictions on Secured Debt.
After the date hereof, the Company will not itself, and will
not permit any Restricted Subsidiary to, create, incur, issue, assume or
guarantee any loans, whether or not evidenced by negotiable instruments or
securities, or any notes, bonds, debentures or other similar evidences of
indebtedness for money borrowed (such loans, and such notes, bonds, debentures
or other similar evidences of indebtedness for money borrowed being hereinafter
in this Section called "Debt"), secured by pledge of, or mortgage or lien on,
any Principal Property of the Company or any Restricted Subsidiary or any shares
of Capital Stock of or Debt of any Restricted Subsidiary (such mortgages,
pledges and liens being hereinafter in this Section called "Mortgage" or
"Mortgages"), without effectively providing that the Securities (together with,
if the Company shall so determine, any other Debt of the Company or such
Restricted Subsidiary then existing or thereafter created which is not
subordinate to the Securities) shall be secured equally and ratably with (or, at
the option of the Company, prior to) such secured Debt, so long as such secured
Debt shall be so secured, unless, after giving effect thereto, the aggregate
amount of all Debt secured by Mortgages plus all Attributable Debt of the
Company and its Restricted Subsidiaries with respect to sale and leaseback
transactions to which Section 10.6 is applicable would not exceed 10 percent of
Consolidated Net Tangible Assets; provided, however, that this Section 10.5
shall not apply to, and there shall be excluded from Debt secured by Mortgages
in any computation under this Section 10.5 or Section 10.6, Debt secured by:
(1) Mortgages on property of, or on any shares of Capital
Stock of or Debt of, any corporation existing at the time such
corporation becomes a Restricted Subsidiary;
(2) Mortgages in favor of the Company or any Restricted
Subsidiary;
(3) Mortgages in favor of any governmental body to secure
progress, advance or other payments pursuant to any contract or
provision of any statute;
(4) Mortgages on property, shares of Capital Stock or Debt
existing at the time of acquisition thereof, or to secure the payment
of all or
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any part of the purchase price thereof or construction thereon or to
secure any Debt incurred prior to, at the time of, or within 180 days
after the later of the acquisition of such property, shares of Capital
Stock or Debt or the completion of construction for the purpose of
financing all or any part of the purchase price thereof or construction
thereon; provided, however, that if such financing is in connection
with the acquisition of any Timberlands, and the Board of Directors has
determined, within 180 days of such acquisition, the Company will seek
such financing (from a lender or investor not including the Company or
any Subsidiary), then the applicable Mortgage shall be deemed to be
included in this Clause (4) if such Mortgage is created within a
further 180 days after the end of such first 180-day period.
(5) Mortgages securing obligations issued by a State,
territory or possession of the United States, or any political
subdivision of any of the foregoing, or the District of Columbia, to
finance the acquisition or construction of property, and on which the
interest is not, in the opinion of tax counsel of recognized standing
or in accordance with a ruling issued by the Internal Revenue Service,
includable in gross income of the holder by reason of Section 103(a) of
the Internal Revenue Code of 1986, as amended (or any successor to such
provision), as in effect at the time of the issuance of such
obligations; or
(6) Any extension, renewal or replacement (or successive
extensions, renewals or replacements), as a whole or in part, of any
Mortgage referred to in the foregoing Clauses (1) through (5),
inclusive; provided, however, that such extension, renewal or
replacement Mortgage shall be limited to all or part of the same
property, shares of Capital Stock or Debt that secured the Mortgage
extended, renewed or replaced (plus improvements on such property).
For purposes of this Section 10.5 and Sections 10.6 and 10.7,
an "acquisition" of property (including real, personal or intangible property or
shares of Capital Stock or Debt) shall include any transaction or series of
transactions by which the Company or a Restricted Subsidiary acquires, directly
or indirectly, an interest, or an additional interest (to the extent thereof),
in such property, including without limitation an acquisition of an interest in,
a Person owning an interest in such property.
SECTION 10.6 Restrictions on Sales and Leasebacks.
After the date hereof, the Company will not itself, and will
not permit any Restricted Subsidiary to, enter into any transaction with any
bank, insurance company or other lender or investor, or to which any such bank,
company, lender or investor is a party, providing for the leasing by the Company
or a Restricted Subsidiary of any Principal Property which has
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been or is to be sold or transferred by the Company or any Restricted Subsidiary
to such bank, company, lender or investor, or to any person to whom funds have
been or are to be advanced by such bank, company, lender or investor on the
security of such Principal Property (herein referred to as a "sale and leaseback
transaction") unless, after giving effect thereto, the aggregate amount of all
Attributable Debt with respect to such sale and leaseback transactions plus all
Debt secured by Mortgages to which Section 10.5 is applicable would not exceed
10 percent of Consolidated Net Tangible Assets, provided, however, that this
Section 10.6 shall not apply to, and there shall be excluded from Attributable
Debt in any computation under this Section 10.6 or Section 10.5, Attributable
Debt with respect to any sale and leaseback transaction if:
(1) The lease in such sale and leaseback transaction is for a
period, including renewal rights, of not in excess of three years;
(2) The Company or a Restricted Subsidiary, within 180 days
after the sale or transfer shall have been made by the Company or by a
Restricted Subsidiary, applies an amount equal to the greater of the
net proceeds of the sale of the Principal Property leased pursuant to
such arrangement or the fair market value of the Principal Property so
leased at the time of entering into such arrangement (as determined in
any manner approved by the Board of Directors) to (a) the retirement of
Funded Debt of the Company ranking on a parity with or senior to the
Securities, or the retirement of Funded Debt of a Restricted
Subsidiary; provided, however, that the amount to be applied to the
retirement of such Funded Debt of the Company or a Restricted
Subsidiary shall be reduced by (i) the principal amount of any
Securities (or other notes or debentures constituting such Funded Debt)
delivered within such 180-day period to the Trustee or other applicable
trustee for retirement and cancellation (for purposes of making such
calculation, the principal amount of Original Issue Discount Securities
so retired or canceled shall mean the portion thereof that could have
been declared due and payable pursuant to Section 5.2 at the time
retired and canceled) and (ii) the principal amount of such Funded
Debt, other than items referred to in the preceding Clause (i),
voluntarily retired by the Company or a Restricted Subsidiary within
180 days after such sale; and provided, further, that, notwithstanding
the foregoing, no retirement referred to in this Clause (a) may be
effected by payment at maturity or pursuant to any mandatory sinking
fund payment or any mandatory prepayment provision, or (b) the purchase
of other property which will constitute Principal Property having a
fair market value, in the opinion of the Board of Directors, at least
equal to the fair market value of the Principal Property leased in such
sale and leaseback transaction;
(3) Such sale and leaseback transaction is entered into prior
to, at the time of, or within 180 days after the later of the
acquisition of the Principal Property or the completion of construction
thereon; provided,
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however, that if such transaction is in connection with the acquisition
of any Timberlands, and the Board of Directors of the Company has
determined, within 180 days of such acquisition, that the Company will
seek to enter into such transaction (with a lender or investor not
including the Company or any Subsidiary), then such transaction shall
be deemed to be included in this Clause (3) if such transaction is
entered into within a further 180 days after the end of such first
180-day period;
(4) The lease in such sale and leaseback transaction secures
or relates to obligations issued by a State, territory or possession of
the United States, or any political subdivision of any of the
foregoing, or the District of Columbia, to finance the acquisition or
construction of property, and on which the interest is not, in the
opinion of tax counsel of recognized standing or in accordance with a
ruling issued by the Internal Revenue Service, includable in gross
income of the holder by reason of Section 103(a) of the Internal
Revenue Code of 1986, as amended (or any successor to such provision),
as in effect at the time of the issuance of such obligations; or
(5) Such sale and leaseback transaction is entered into
between the Company and a Restricted Subsidiary or between Restricted
Subsidiaries.
SECTION 10.7 Restrictions on Funded Debt of Restricted Subsidiaries.
The Company will not permit any Restricted Subsidiary to
create, incur, issue, assume or guarantee any Funded Debt unless, after giving
effect thereto, the aggregate principal amount of all such Funded Debt of all
Restricted Subsidiaries would not exceed 10 percent of Consolidated Net Tangible
Assets; provided, however, that this Section 10.7 shall not apply to and there
shall be excluded from Funded Debt in any computation under this Section 10.7:
(1) Funded Debt owed to the Company or a Restricted
Subsidiary;
(2) Funded Debt secured by Mortgages permitted under Section
10.5;
(3) Funded Debt of any corporation existing at the time such
corporation becomes a Restricted Subsidiary;
(4) Funded Debt of any Person outstanding at the time of its
acquisition, or the acquisition of substantially all its assets, by
such Restricted Subsidiary;
(5) Funded Debt constituting Attributable Debt permitted under
Section 10.6; or
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(6) Any extension, renewal or replacement (or successive
extensions, renewals or replacements), as a whole or in part, of not
more than an equal principal amount of any Funded Debt (or any other
indebtedness which at the time of its creation was Funded Debt)
referred to in the foregoing Clauses (1) through (5), inclusive.
SECTION 10.8 Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after
the end of each fiscal year of the Company ending after the date hereof, an
Officers' Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of
any of the terms, provisions, and conditions of this Indenture (without regard
to any period of grace or requirement of notice provided hereunder) and, if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
SECTION 10.9 Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with
any covenant or condition set forth in Sections 10.5 to 10.7, inclusive, with
respect to the Securities of any series if before or after the time for such
compliance the Holders of not less than a majority in principal amount of the
Securities of such series at the time Outstanding shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance with
such covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such covenant or condition shall remain in full
force and effect.
ARTICLE 11
REDEMPTION OF SECURITIES
SECTION 11.1 Applicability of Article.
Redemption of Securities of any series at the election of the
Company as permitted or required by the terms of such Securities shall be made
in accordance with the terms of such Securities and (except as otherwise
specified as contemplated by Section 3.1 for Securities of any series) in
accordance with this Article.
SECTION 11.2 Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at the
election of the Company of
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less than all the Securities of any series, the Company shall, at least 60 days
prior to the Redemption Date fixed by the Company (unless a shorter notice shall
be satisfactory to the Trustee), notify the Trustee of such Redemption Date and
of the principal amount and tenor of Securities of such series to be redeemed.
In the case of any redemption of Securities prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction.
SECTION 11.3 Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions of the principal amount of Securities of
such series; provided, however, that no such partial redemption shall reduce the
portion of the principal amount of a Security not redeemed to less than the
minimum authorized denomination for Securities of that series. If the Securities
to be redeemed consist of Securities having different Stated Maturities or
different rates of interest (or methods of computing interest), then the Company
may, by written notice to the Trustee, direct that the Securities of such series
to be redeemed shall be selected from among groups of such Securities having
specified Stated Maturities or rates of interest (or methods of computing
interest) and the Trustee shall thereafter select the particular Securities to
be redeemed in the manner set forth above from among the groups of such
Securities so specified.
The Trustee shall promptly notify the Company and the Security
Registrar (if other than itself) in writing of the Securities selected for
redemption and, in the case of any Security selected for partial redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.
SECTION 11.4 Notice of Redemption.
Notice of redemption shall be given in the manner provided in
Section 1.6, not less than 30 nor more than 60 days prior to the Redemption
Date, unless a shorter period is specified in the Securities to be redeemed, to
each Holder of Securities to be redeemed.
All notices of redemption shall state:
(1) The Redemption Date;
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(2) The Redemption Price;
(3) If less than all the Outstanding Securities of any series
are to be redeemed, the identification (and, in the case of partial
redemption, the principal amounts) of the particular Securities to be
redeemed;
(4) That, on the Redemption Date, the Redemption Price will
become due and payable upon each such Security or portion thereof to be
redeemed and, if applicable, that interest thereon will cease to accrue
on and after said date;
(5) The place or places where such Securities are to be
surrendered for payment of the Redemption Price; and
(6) That the redemption is for a sinking fund, if such is the
case.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company.
SECTION 11.5 Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit
in trust with the Trustee or with a Paying Agent (or, if the Company is acting
as its own Paying Agent, segregate and hold in trust as provided in Section
10.3) an amount of money sufficient to pay the Redemption Price of, and (except
if the Redemption Date shall be an Interest Payment Date) accrued interest, if
any, on, all the Securities or portions thereof which are to be redeemed on that
date.
SECTION 11.6 Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, and from and after such date
(unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Securities shall cease to bear interest. Upon surrender
of any such Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price, together with
accrued interest, if any, to the Redemption Date; provided, however, that
installments of interest whose Stated Maturity is on or prior to the Redemption
Date shall be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such at the close of business on the
Regular Record Dates therefor according to their terms and the provisions of
Section 3.7.
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If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate or rates
prescribed therefor in such Security.
SECTION 11.7 Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be
surrendered at an office or agency of the Company designated for that purpose
pursuant to 10.2 (with, if the Company, the Trustee or the Security Registrar so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company, the Trustee or the Security Registrar duly executed
by, the Holder thereof or his attorney duly authorized in writing), and the
Company shall execute, and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or Securities of
the same series, of like tenor and of any authorized denomination as requested
by such Holder, in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Security so surrendered. If a Global
Security is so surrendered, the Company shall execute, and the Trustee shall
authenticate and deliver to the Depository for such Global Security, without
service charge, a new Global Security in a denomination equal to and in exchange
for the unredeemed portion of the principal of the Global Security so
surrendered.
ARTICLE 12
SINKING FUNDS
SECTION 12.1 Applicability of Article.
The provisions of this Article shall be applicable to any
sinking fund for the retirement of Securities of a series except as otherwise
specified as contemplated by Section 3.1 for Securities of such series.
The minimum amount of any sinking fund payment provided for by
the terms of the Securities of any series is herein referred to as a "mandatory
sinking fund payment", and any payment in excess of such minimum amount provided
for by the terms of Securities of any series is herein referred to as an
"optional sinking fund payment." If provided for by the terms of Securities of
any series, the cash amount of any sinking fund payment may be subject to
reduction as provided in Section 12.2. Each sinking fund payment shall be
applied to the redemption of Securities of any series as provided for by the
terms of Securities of such series.
SECTION 12.2 Satisfaction of Sinking Fund Payments with Securities.
The Company may, in satisfaction of all or any part of any
sinking fund payment with respect to the Securities of any series to be made
pursuant to the terms of such Securities, (1) deliver Outstanding Securities of
such series (other than any previously called for
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redemption) and (2) apply as a credit Securities of such series which have been
redeemed (or called for redemption and for which the Redemption Price, together
with accrued interest, if any, has been deposited pursuant to Section 11.5)
either at the election of the Company pursuant to the terms of such Securities
or through the application of permitted optional sinking fund payments pursuant
to the terms of such Securities; provided that such Securities have not been
previously so credited. Such Securities shall be received and credited for such
purpose by the Trustee at the Redemption Price specified in such Securities for
redemption through operation of the sinking fund and the amount of such sinking
fund payment shall be reduced accordingly.
SECTION 12.3 Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date
for any series of Securities, the Company will deliver to the Trustee an
Officers' Certificate specifying the amount of the next ensuing sinking fund
payment for that series pursuant to the terms of that series, the portion
thereof, if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and crediting Securities
of that series pursuant to Section 12.2, and the optional amount, if any, to be
added in cash to the next ensuing mandatory sinking fund payment, and will also
deliver to the Trustee any Securities to be credited and not theretofore so
delivered. If such Officers' Certificate shall specify an optional amount be
added to the next ensuing mandatory sinking fund payment, the Company shall
thereupon be obligated to pay the amount therein specified. Not less than 45
days before each such sinking fund payment date the Trustee shall select the
Securities to be redeemed upon such sinking fund payment date in the manner
specified in Section 11.3 and cause notice of the redemption thereof to be given
in the name of and at the expense of the Company in the manner provided in
Section 11.4. The Company shall deposit the amount of cash, if any, required for
such sinking fund payment in the manner provided in Section 11.5. Such notice
having been duly given, the redemption of such Securities shall be made upon the
terms and in the manner stated in Sections 11.6 and 11.7.
ARTICLE 13
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 13.1 Applicability of Article; Company's Option to Effect
Defeasance or Covenant Defeasance.
If pursuant to Section 3.1 provision is made for either or
both of (a) defeasance of the Securities of a series under Section 13.2 or (b)
covenant defeasance of the Securities of a series under Section 13.3, then the
provisions of such Section or Sections, as the case may be, together with the
other provisions of this Article 13, shall be applicable to the Securities of
such series, and the Company may at its option by Board Resolution, at any time,
with respect to the Securities of such series, elect to have either Section 13.2
(if applicable) or Section 13.3 (if
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applicable) be applied to the Outstanding Securities of such series upon
compliance with the conditions set forth below in this Article 13.
SECTION 13.2 Defeasance and Discharge.
Upon the Company's exercise of the above option applicable to
this Section with respect to defeasance of the Outstanding Securities of a
particular series, the Company shall be deemed to have been discharged from its
obligations with respect to the Outstanding Securities of such series on and
after the date the conditions precedent set forth below are satisfied
(hereinafter, "defeasance"). For this purpose, such defeasance means that the
Company shall be deemed to have paid and discharged the entire indebtedness
represented by the Outstanding Securities of such series and to have satisfied
all its other obligations under such Securities and this Indenture insofar as
such Securities are concerned (and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged
hereunder: (A) the rights of Holders of Securities of such series to receive,
solely from the trust fund described in Section 13.4 as more fully set forth in
such Section, payments as set forth therein, (B) the Company's obligations with
respect to such Securities under Sections 3.4, 3.5, 3.6, 6.8, 10.2, and 10.3 and
such obligations as shall be ancillary thereto, (C) the rights, powers, trusts,
duties, immunities, indemnities, and other provisions in respect of the Trustee
hereunder, and (D) this Article 13. Subject to the compliance with this Article
13, the Company may exercise its option under this Section 13.3 notwithstanding
the prior exercise of its option under Section 13.3 with respect to the
Securities of such series.
SECTION 13.3 Covenant Defeasance.
Upon the Company's exercise of the above option applicable to
this Section with respect to covenant defeasance of the Outstanding Securities
of a particular series, the Company shall be released from its obligations under
Sections 8.1, 10.5, 10.6, and 10.7 (and any other covenant applicable to such
Securities that is determined pursuant to Section 3.1 to be subject to covenant
defeasance under this Section 5.1) and the occurrence of an event specified in
Clause (4) of Section 5.1 with respect to any of Sections 8.1, 10.5, 10.6, or
10.7 or (and any other Event of Default applicable to such Securities that is
determined pursuant to Section 3.1 to be subject to covenant defeasance under
this Section) shall not be deemed to be an Event of Default with respect to the
Outstanding Securities of such series on and after the date the conditions set
forth below are satisfied (hereinafter, "covenant defeasance"). For this
purpose, such covenant defeasance means that, with respect to the Outstanding
Securities of such series, the Company may omit to comply with and shall have no
liability in respect of any term, condition, or limitation set forth in any such
Section or Clause whether directly or indirectly by reason of any reference
elsewhere herein to any such Section or Clause or by reason of any reference to
any such Section or Clause to any other provision herein or in any other
document, but the remainder of this Indenture and such Securities shall be
unaffected thereby.
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SECTION 13.4 Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions precedent to application
of either Section 13.2 or Section 13.3 to the Outstanding Securities of a
particular series:
(1) The Company shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee satisfying the
requirements of Section 6.7 who shall agree to comply with the
provisions of this Article 13 applicable to it) as trust funds in trust
for the purpose of making the following payments, specifically pledged
as security for, and dedicated solely to, the benefit of the Holders of
such Securities, (A) money in an amount, or (B) Government Obligations
which through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide, not later
than one day before the due date of any payment, money in an amount, or
(C) a combination thereof, sufficient, without reinvestment, in the
opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereto delivered to
the Trustee, to pay and discharge, and which shall be applied by the
Trustee (or other qualifying trustee) to pay and discharge, (i) the
principal of and any premium and interest on the Outstanding Securities
of such series on the Stated Maturity of such principal, premium, or
interest and (ii) any mandatory sinking fund payments or analogous
payments applicable to the Outstanding Securities of such series on the
day on which such payments are due in accordance with the terms of this
Indenture and of such Securities. Before such a deposit, the Company
may make arrangements satisfactory to the Trustee for the redemption of
Securities at a future date or dates in accordance with Article 11,
which shall be given effect in applying the foregoing. For this
purpose, "Government Obligations" means (A) with respect to any series
of Securities the principal of and any premium and interest on which
are payable in U.S. dollars securities that are (x) direct obligations
of the United States of America for the payment of which its full faith
and credit is pledged or (y) obligations of a Person the timely payment
of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank (as defined in
Section 3(a)(2) of the Securities Act of 1933) as custodian with
respect to any such Government Obligation or a specific payment of
principal of or interest on any such Government Obligation held by such
custodian for the account of the holder of such depository receipt,
provided that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the holder
of such depository receipt from any amount received by the custodian in
respect of the Government Obligation or the specific payment
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<PAGE>
of principal of or interest on the Government Obligation evidenced by
such depository receipt and (B) with respect to any other series of
Securities, the meaning specified therefor pursuant to Section 3.1.
(2) No Event of Default or event which with notice or lapse of
time or both would become an Event of Default with respect to the
Securities of such series shall have occurred and be continuing (A) on
the date of such deposit or (B) insofar as subsections (5) and (6) are
concerned, at any time during the period ending on the 90th day after
the date of such deposit or, if longer, ending on the day following the
expiration of the longest preference period applicable to the Company
in respect of such deposit (it being understood that the condition in
this condition shall not be deemed satisfied until the expiration of
such period).
(3) Such defeasance or covenant defeasance shall not (A) cause
the Trustee for the Securities of such series to have a conflicting
interest as provided in the Trust Indenture Act with respect to any
securities of the Company or (B) result in the trust arising from such
deposit to constitute, unless it is qualified as, a regulated
investment company under the Investment Company Act of 1940, as
amended.
(4) Such defeasance or covenant defeasance shall not result in
a breach or violation of, or constitute a default under, this Indenture
or any other agreement or instrument to which the Company is a party or
by which it is bound.
(5) In the case of an election under Section 13.2, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that
(x) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling, or (y) since the date of this
Indenture there has been a change in the applicable Federal income tax
law, in either case to the effect that, and based thereon such opinion
shall confirm that, the Holders of the Outstanding Securities of such
series will not recognize income, gain, or loss for Federal income tax
purposes as a result of such defeasance and will be subject to Federal
income tax on the same amounts, in the same manner, and at the same
times as would have been the case if such defeasance had not occurred.
(6) In the case of an election under Section 13.3, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Holders of the Outstanding Securities of such series will not
recognize income, gain, or loss for Federal income tax purposes as a
result of such covenant defeasance and will be subject to Federal
income tax on the same
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<PAGE>
amounts, in the same manner, and at the same times as would have been
the case if such covenant defeasance had not occurred.
(7) Such defeasance or covenant defeasance shall be effected
in compliance with any additional terms, conditions, or limitations
which may be imposed on the Company in connection therewith pursuant to
Section 3.1.
(8) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the defeasance
under Section 13.2 or the covenant defeasance under Section 13.3 (as
the case may be) have been complied with.
(9) The Company shall have delivered to the Trustee an
Officers' Certificate to the effect that the Securities of such series,
if listed on any securities exchange, will not be delisted as a result
of such deposit.
SECTION 13.5 Deposited Money and Government Obligations to be Held in
Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section
10.3, all money and Government Obligations (including the proceeds thereof)
deposited with the Trustee (or other qualifying trustee--collectively, for
purposes for this Section 13.5, the "Trustee") pursuant to Section 13.4 in
respect of the Outstanding Securities of such series shall be held in trust and
applied by the Trustee, in accordance with the provisions of such Securities and
this Indenture, to the payment, either directly or through any Paying Agent (but
not including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Securities, of all sums due and to become due
thereon in respect of principal, premium, and interest, but such money need not
be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any
tax, fee, or other charge imposed on or assessed against the money or Government
Obligations deposited pursuant to Section 13.4 or the principal and interest
received in respect thereof.
Anything herein to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request any
money or Government Obligations held by it as provided in Section 13.4 which, in
the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof which would then be required to be deposited to
effect an equivalent defeasance or covenant defeasance.
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<PAGE>
SECTION 13.6 Reinstatement.
If the Trustee or the Paying Agent is unable to apply any
money in accordance with Section 13.2 or 13.3 with respect to the Securities of
any series by reason of any order or judgment of any court or governmental
authority enjoining, restraining, or otherwise prohibiting such application,
then the Company's obligations under this Indenture and the Securities of such
series shall be revived and reinstated as though no deposit had occurred
pursuant to this Article 13 until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 13.2 or 13.3;
provided, however, that if the Company makes any payment of the principal of or
any premium or interest on any such Security following the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the money held by the Trustee or
the Paying Agent.
ARTICLE 14
SUBORDINATION OF SECURITIES
SECTION 14.1 Securities Subordinate to Senior Debt.
The Company for itself and its successors covenants and
agrees, and each Holder of a Security, by his acceptance thereof, likewise
covenants and agrees, that the indebtedness represented by the Securities and
the payment of the principal of and interest on each and all of the Securities
are hereby expressly subordinated to the extent and in the manner hereinafter
set forth in this Article to the prior payment in full of all Senior Debt.
This Article 14 shall constitute a continuing offer and
inducement to all Persons who become holders of, or continue to hold, Senior
Debt. The provisions of this Article 14 are made for the benefit of the holders
of Senior Debt each of whom is an obligee hereunder and is entitled to enforce
such holders' rights hereunder, without any act or notice of acceptance hereof
or reliance hereon. No amendment, modification, or discharge of any provision of
this Article 14 (as the same may be supplemented by any indenture supplemental
hereto prior to the issuance of any Securities) shall be effective against any
holder of Senior Debt unless expressly consented to in writing by such holder.
The provisions of this Article 14 apply notwithstanding anything to the contrary
contained in the Securities or this Indenture.
SECTION 14.2 Payment Over of Proceeds Upon Dissolution, Etc.
In the event of any liquidation, dissolution, winding up, or
reorganization of the Company (whether voluntary or involuntary and whether in
insolvency or receivership proceedings, or upon an assignment for the benefit of
creditors or any other marshalling of assets or liabilities of the Company or
otherwise) (each such event, if any, herein sometimes
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<PAGE>
referred to as a "Proceeding"), the Company and each Holder of a Security, by
his acceptance thereof, covenant and agree that:
(1) all Senior Debt shall first be paid in full, before any
payment or distribution is made upon the principal of or interest on
the Securities;
(2) any payment or distribution of assets of the Company or
from the estate created by the commencement of any such Proceeding,
whether in cash, property, or securities, to which the Holders of
Securities would be entitled but for the provisions of this Article
(including any payment or distribution which may be payable or
deliverable to Holders of the Securities made in respect of any
indebtedness of the Company subordinated to the payment of the
Securities, such payment or distribution being hereinafter referred to
as a "Junior Subordinated Payment") shall be paid or delivered by the
Company or any receiver, trustee in bankruptcy, liquidating trustee,
agent, or other Person making such payment or distribution, directly to
the holders of Senior Debt or their representative or representatives
or to the trustee or trustees under any indenture under which any
instruments evidencing any of such Senior Debt may have been issued, as
their respective interests may appear, to the extent necessary to pay
in full all Senior Debt remaining unpaid, after giving effect to any
concurrent payment or distribution to the holders of such Senior Debt,
before any payment or distribution is made to the Holders of the
Securities; and
(3) in the event that any payment or distribution of cash,
property, or securities shall be received by the Holder of any Security
in contravention of subsection (1) or (2) of this Section 14.2
(including any Junior Subordinated Payment) before all Senior Debt is
paid in full such payment or distribution shall be held for the benefit
of and paid over to the holders of such Senior Debt or their
representative or representatives or to the trustee or trustees under
any indenture under which any instruments evidencing any Senior Debt
may have been issued, as their respective interests may appear, to the
extent necessary to pay in full all Senior Debt remaining unpaid, after
giving effect to any concurrent payment or distribution to the holders
of Senior Debt.
The Company shall give prompt written notice to the Holders of
the Securities of any dissolution, winding-up, liquidation, or reorganization of
the Company or any assignment for the benefit of creditors.
The consolidation of the Company with, or the merger of the
Company into, another corporation or the liquidation or dissolution of the
Company following the sale, conveyance, or lease of all of its properties to
another corporation shall not be deemed a
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<PAGE>
dissolution, winding-up, liquidation, or reorganization for the purposes of this
Section if such other corporation shall, as a part of such consolidation,
merger, sale, conveyance, or lease, expressly assume the due and punctual
payment of the principal of and interest on the Securities, according to their
tenor, and the due and punctual performance of every covenant of the Securities
and this Indenture on the part of the Company to be performed or observed.
SECTION 14.3 No Payment When Senior Debt in Default.
The Company shall not make any payment with respect to the
Securities if and so long as any Senior Debt is or becomes due and payable
(whether at maturity, for an installment of principal or interest, upon
acceleration, for mandatory prepayment, or otherwise) and remains unpaid after
the date the same is due and payable. A payment with respect to the Securities
shall include, without limitation, payment of principal and interest on the
Securities, the purchase of the Securities by the Company and any other payment.
SECTION 14.4 Payment Permitted If No Default.
Except as expressly provided in this Article 14, nothing
contained in this Article or elsewhere in this Indenture or in any of the
Securities shall affect the obligation of the Company to make payments of the
principal of or interest on the Securities at any time in accordance with the
provision of the Indenture.
SECTION 14.5 Subrogation to Rights of Holders of Senior Debt.
Subject to and only after the payment in full of all Senior
Debt at the time outstanding, the Holders of the Securities shall be subrogated
to the rights of the holders of Senior Debt (to the extent of payments or
distributions previously made to such holders of Senior Debt pursuant to the
provisions of Section 14.2 and equally and ratably with the holders of all
indebtedness of the Company which by its express terms is subordinated to
indebtedness of the Company to substantially the same extent as the Securities
are subordinated and is entitled to like rights of subrogation) to receive
payments or distribution of assets of the Company applicable to the Senior Debt
until amounts owing on the Securities shall be paid in full. No payments or
distributions to the holders of the Senior Debt of any cash, property, or
securities to which the Holders of the Securities would be entitled except for
the provisions of this Article, and no payments over pursuant to the provisions
of this Article to the holders of Senior Debt by Holders of the Securities or
the Trustee, shall, as among the Company, its creditors other than holders of
Senior Debt and the Holders of the Securities, be deemed to be a payment by the
Company to or for the account of the holders of Senior Debt.
SECTION 14.6 Provisions Solely to Define Relative Rights.
The provisions of this Article are intended solely for the
purpose of defining the relative rights of the Holders on the one hand and the
holders of Senior Debt on the other hand.
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<PAGE>
Nothing contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall (a) impair the obligation of the Company,
which is absolute and unconditional to pay to the Holders of the Securities
(subject to the rights of the holders of Senior Debt) the principal of and
interest on the Securities as and when the same shall become due and payable in
accordance with their terms; or (b) affect the relative rights of the Holders of
the Securities and creditors of the Company other than the holders of Senior
Debt; or (c) prevent the Trustee or the Holder of any Security from exercising
all remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article, of the holders of
Senior Debt to receive cash, property, or securities of the Company received
upon the exercise of any such remedy.
SECTION 14.7 Holders of Senior Debt and Trustee to Effectuate
Subordination.
Each Holder of a Security by its acceptance thereof, if and so
long as payment with respect to the Security is prohibited under this Article,
irrevocably authorizes and empowers (but without imposing any obligation on, or
any duty to the Holder from) each holder of Senior Debt at any time outstanding
and such holder's representatives, to demand, sue for, collect, receive and
receipt for the Holder's payments and distributions in respect of the Securities
(including, without limitation, all payments and distributions which may be
payable or deliverable pursuant to the terms of any indebtedness subordinated to
the Securities) which are required to be paid or delivered to the holders of
Senior Debt as provided in this Article and to file and prove all claims
therefor and take all such other action (including the right to vote, file, and
prove claims respecting any indebtedness subordinated to the Securities) in the
name of the Holder, or otherwise, as such holder of Senior Debt or such holder's
representatives, may determine to be necessary or appropriate for the
enforcement of the provisions of this Article.
Each Holder of a Security by his acceptance thereof also
authorizes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article 14.
SECTION 14.8 No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Debt of
the Company to enforce subordination as herein provided shall at any time in any
way be prejudiced or impaired by any act or failure to act on the part of the
Company or the Holder of any Security or by any act or failure to act, by any
such holder, or by any noncompliance by the Company or the Holder of any
Security with the terms, provisions, and covenants of this Indenture, regardless
of any knowledge thereof which any such holder may have or be otherwise charged
with. No provision of any supplemental indenture that affects the superior
position of the holders of Senior Debt shall be effective against the holders of
Senior Debt who have not consent thereto.
The holders of Senior Debt may extend, renew, modify, or amend
the terms of the Senior Debt or any security therefor or guaranty thereof and
release, sell, or exchange or
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<PAGE>
enforce such security or guaranty or elect any right or remedy, or delay in
enforcing or release any right or remedy and otherwise deal freely with the
Company all without notice to the Holders of the Securities and all without
affecting the liabilities and obligations of the Holders of the Securities, even
if any right of reimbursement or subrogation or other right or remedy of the
Holders of the Securities is extinguished, affected, or impaired thereby.
SECTION 14.9 Notice to Trustee; Notice to Company.
The Company shall give prompt written notice to the Trustee of
any fact known to the Company which would prohibit the making of any payment to
or by the Trustee in respect of the Securities. Unless and until written notice
shall be received by a Responsible Officer of the Trustee from any holder of
Senior Debt notifying the Trustee of the existence of one or more of the
circumstances which would prohibit the making of any payment with respect to the
Securities under the provisions of Section 14.3 and stating that it is a "Notice
of Senior Debt Default," the Trustee shall be entitled to assume that no such
circumstances exist.
Any funds deposited with or collected by the Trustee in
respect of the Securities shall be subject to the provisions of this Article,
except that, if immediately prior to the date on which by the terms of the
Securities any such funds may become payable for any purpose (including, without
limitation, the payment of either the principal of or the interest on the
Securities), the Trustee shall not have received with respect to such funds the
Notice of Senior Debt Default provided for in this Section, then the Trustee
shall have full power and authority to receive such funds and to apply the same
to the purpose for which they were received and shall not be affected with
respect to such funds by any Notice of Senior Debt Default to the contrary which
may be received by the Trustee on or after such date.
Any notice required or permitted to be given to the Trustee by
a holder of Senior Debt shall be in writing and shall be sufficient for every
purpose hereunder if in writing and either (i) sent via facsimile to the
Trustee, the receipt of which shall be confirmed via telephone, or (ii) mailed,
first-class, postage prepaid, or sent by overnight carrier, to the Trustee
addressed to it at the address of its principal office specified in the first
paragraph of this instrument or at any other address furnished in writing to
such holder of Senior Debt by the Trustee.
Subject to the provisions of Section 6.1 hereof, the Trustee
shall be entitled to rely on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior Debt (or a trustee, fiduciary, or
agent therefor) to establish that such notice has been given by a holder of
Senior Debt or a trustee, fiduciary, or agent therefor. In the event that the
Trustee determines in good faith that further evidence is required with respect
to the right of any Person as a holder of Senior Debt to participate in any
payment or distribution pursuant to this Article, the Trustee may request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Debt held by such Person, the extent to which such Person
is entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article, and if such evidence
is not furnished, the Trustee may defer
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any payment to such Person pending judicial determination as to the right of
such Person to receive such payment.
Notwithstanding anything else contained herein, no notice,
request, or other communication to or with the Trustee shall be deemed given
unless received by a Responsible Officer at the Trustee's principal
corporate trust office.
The Trustee and any Holder shall promptly advise the Company
of any notice, presentation, or demand, as the case may be, received by the
Trustee or such Holder from holders of Senior Debt.
SECTION 14.10 Reliance on Judicial Order or Certificate of Liquidating
Agent.
Upon any payment or distribution of assets of the Company
referred to in Section 14.2, the Trustee, subject to the provisions of Section
6.1 hereof, and the Holders of the Securities shall be entitled to rely upon a
certificate of the trustee in bankruptcy, receiver, liquidating trustee, agent,
or other Person making such payment or distribution, delivered to the Trustee or
to the Holders of Securities, for the purpose of ascertaining the Persons
entitled to participate in such distribution, the holders of Senior Debt and
other indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon, and all other facts pertinent
thereto or to this Article.
SECTION 14.11 Trustee and Holders Not Fiduciaries for Holders of Senior
Debt.
The Trustee shall not be deemed to owe any fiduciary duty to
the holders of Senior Debt and it undertakes to perform or observe only such of
its covenants and obligations as are specifically set forth in this Article, and
no implied covenants or obligations with respect to the Senior Debt shall be
read into this Indenture against the Trustee. The Trustee shall not be liable to
any such holders if it shall in good faith mistakenly pay over or distribute to
Holders of Securities or to the Company or to any other Person cash, property,
or securities to which any holders of Senior Debt shall be entitled by virtue of
this Article or otherwise.
The Holder of a Security owes no fiduciary duty to the holders
of Senior Debt and the Holders undertake to perform or to observe only such
covenants and obligations as are specifically set forth in this Indenture and no
implied covenants and obligations with respect to holders of Senior Debt shall
be read into this Indenture against the Holders.
SECTION 14.12 Rights of Trustee as Holder of Senior Debt; Preservation of
Trustee's Rights.
The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article with respect to any Senior Debt which
may at any time be held by it, to the same
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extent as any other holder of Senior Debt, and nothing in this Indenture shall
deprive the Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 6.6 hereof.
SECTION 14.13 Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this Article in addition to or in place of the Trustee.
* * *
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
WILLAMETTE INDUSTRIES, INC.
[SEAL] By --------------------------------------
Attest: ------------------
-----------------------------------------
as Trustee
[SEAL]
By
Attest: ------------------
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<PAGE>
STATE OF OREGON )
) ss
COUNTY OF MULTNOMAH )
On this --- day of --------------, 1997, before me, a Notary
Public in and for said County and State, personally appeared the within named
- ---------------------------- and ----------------------------, to me known, who
being first duly and severally sworn did say that he, said
- ----------------------------, is ----------------------------, and that he, said
- ----------------------------, is ---------------------------- of WILLAMETTE
INDUSTRIES, INC., one of the corporations described in and which executed the
above instrument; that the seal affixed to the foregoing instrument is the seal
of said corporation; that said instrument was signed and sealed in behalf of
said corporation by authority of its Board of Directors; and that
- ---------------------------- and ---------------------------- acknowledged the
execution of said instrument to be the free act and deed of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the date first hereinabove written.
---------------------------------------
[SEAL] Notary Public for Oregon
My Commission Expires:
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<PAGE>
STATE OF ------------ )
) ss
COUNTY OF ---------- )
On this --- day of --------------, 1997, before me, a Notary
Public in and for said County and State, personally appeared the within named
- ---------------------------- and ----------------------------, to me known, who
being first duly and severally sworn did say that he, said
- ----------------------------, is ----------------------------, and that he, said
- ----------------------------, is ---------------------------- of
- ----------------------------, one of the corporations described in and which
executed the above instrument; that the seal affixed to the foregoing instrument
is the seal of said corporation; that said instrument was signed and sealed in
behalf of said corporation by authority of its Board of Directors; and that
- ---------------------------- and ---------------------------- acknowledged the
execution of said instrument to be the free act and deed of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the date first hereinabove written.
[SEAL]
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FORM OF
TRUST SECURITIES GUARANTEE
Between
WILLAMETTE INDUSTRIES, INC.
(as Guarantor)
and
(as Guarantee Trustee)
dated as of _____________, 1997
<PAGE>
CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Guarantee Agreement
310(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1(a)
310(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1(c), 2.8
310(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
311(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
312(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(a)
312(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
313. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
314(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
314(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5
314(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1, 2.5, 3.2
314(f). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1, 3.2
315(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(d)
315(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.7
315(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(c)
315(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(d)
316(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1, 2.6, 5.4
316(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3
316(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.2
317(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
317(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
318(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1(b)
318(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1
318(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1(a)
* 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.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE I. DEFINITIONS............................................................................2
Section 1.1. Definitions.....................................................................................2
ARTICLE II. TRUST INDENTURE ACT....................................................................4
Section 2.1. Trust Indenture Act; Application................................................................4
Section 2.2. List of Holders.................................................................................4
Section 2.3. Reports by the Guarantee Trustee................................................................5
Section 2.4. Periodic Reports to the Guarantee Trustee.......................................................5
Section 2.5. Evidence of Compliance with Conditions Precedent................................................5
Section 2.6. Events of Default; Waiver.......................................................................5
Section 2.7. Event of Default; Notice........................................................................6
Section 2.8. Conflicting Interests...........................................................................6
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE
TRUSTEE................................................................................6
Section 3.1. Powers and Duties of the Guarantee Trustee......................................................6
Section 3.2. Certain Rights of Guarantee Trustee.............................................................8
Section 3.3. Indemnity.......................................................................................9
ARTICLE IV. GUARANTEE TRUSTEE..............................................................................10
Section 4.1. Guarantee Trustee: Eligibility.................................................................10
Section 4.2. Appointment, Removal and Resignation of the Guarantee Trustee..................................10
ARTICLE V. GUARANTEE .....................................................................................11
Section 5.1. Guarantee......................................................................................11
Section 5.2. Waiver of Notice and Demand....................................................................11
Section 5.3. Obligations Not Affected.......................................................................11
Section 5.4. Rights of Holders..............................................................................12
Section 5.5. Guarantee of Payment...........................................................................13
Section 5.6. Subrogation....................................................................................13
Section 5.7. Independent Obligations........................................................................13
ARTICLE VI. COVENANTS AND SUBORDINATION....................................................................13
Section 6.1. Subordination..................................................................................13
Section 6.2. Pari Passu Guarantees..........................................................................13
Section 6.3. Limitation of Transactions.....................................................................14
Section 6.4. Corporate Existence............................................................................14
<PAGE>
ARTICLE VII. TERMINATION...........................................................................15
Section 7.1. Termination....................................................................................15
ARTICLE VIII. MISCELLANEOUS.........................................................................15
Section 8.1. Successors and Assigns.........................................................................15
Section 8.2. Amendments.....................................................................................15
Section 8.3. Notices........................................................................................15
Section 8.4. Consolidation, Merger, Conveyance, Transfer or Lease...........................................16
Section 8.5. Benefit........................................................................................17
Section 8.6. Interpretation.................................................................................17
Section 8.7. Governing Law..................................................................................17
</TABLE>
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TRUST SECURITIES GUARANTEE
This TRUST SECURITIES GUARANTEE, dated as of -------------,
1997, is executed and delivered by WILLAMETTE INDUSTRIES, INC., an Oregon
corporation (the "Guarantor"), having its principal office at 1300 S.W. Fifth
Avenue, Suite 3800, Portland, Oregon 97201, and
[--------------------------------] a banking corporation, as trustee (the
"Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Preferred Securities and Common Securities (each as defined
herein and together, the "Securities") of Willamette Capital I, a Delaware
statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of
Trust and Trust Agreement, dated as of -----------, 1997 (the "Trust
Agreement"), among the Guarantor, as Depositor, the Property Trustee and the
Delaware Trustee named therein, the Administrative Trustees named therein and
the Holders from time to time of undivided beneficial ownership interests in the
assets of the Issuer, the Issuer is issuing $------- aggregate Liquidation
Amount (as defined in the Trust Agreement) of its Preferred Securities,
Liquidation Amount $---- per preferred security) (the "Preferred Securities")
representing undivided beneficial ownership interests in the assets of the
Issuer and having the terms set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Issuer
and the proceeds thereof, together with the proceeds from the issuance of the
Issuer's Common Securities (as defined herein), will be used to purchase the
Subordinated Debt Securities (as defined in the Trust Agreement) of the
Guarantor which will be deposited with [---------------------------------], as
Property Trustee under the Trust Agreement, as trust assets; and
WHEREAS, as incentive for the Holders to purchase Securities
the Guarantor desires irrevocably and unconditionally to agree, to the extent
set forth herein, to pay to the Holders of the Securities the Guarantee Payments
(as defined herein) and to make certain other payments on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each
Holder of 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 from time to time of the Securities.
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ARTICLE I. DEFINITIONS
Section 1.1. Definitions.
As used in this Guarantee Agreement, the terms set forth below
shall, unless the context otherwise requires, have the following meanings.
Capitalized or otherwise defined terms used but not otherwise defined herein
shall have the meanings assigned to such terms in the Trust Agreement as in
effect on the date hereof.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person; provided, however, that an Affiliate
of the Guarantor shall not be deemed to be an Affiliate of the Issuer. For the
purposes of this definition, "control" when used with respect to any specified
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Board of Directors" means either the board of directors of
the Guarantor or any committee of that board duly authorized to act hereunder.
"Common Securities" means the securities representing common
undivided beneficial ownership interests in the assets of the Issuer.
"Event of Default" means a failure by the Guarantor to perform
any of its payment or other obligations under this Guarantee Agreement;
provided, however, that, except with respect to a default in payment of any
Guarantee Payments, the Guarantor shall have received notice of default and
shall not have cured such default within 90 days after receipt of such notice.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Securities, to the
extent not paid or made by or on behalf of the Issuer: (i) any accrued and
unpaid Distributions (as defined in the Trust Agreement) required to be paid on
the Securities, to the extent the Issuer shall have funds on hand available
therefor at such time, (ii) the redemption price, including all accrued and
unpaid Distributions to the date of redemption (the"Redemption Price"), with
respect to any Securities called for redemption by the Issuer, to the extent the
Issuer shall have funds on hand available therefor at such time, and (iii) upon
a voluntary or involuntary termination, winding up or liquidation of the Issuer
(other than in connection with the distribution of Subordinated Debt Securities
to the Holders or the redemption of all the Securities), the lesser of (a) the
aggregate of the Liquidation Amount plus accrued and unpaid Distributions to the
date of payment, to the extent the Issuer has funds available therefor at such
time, and (b) the amount of assets of the Issuer remaining available for
distribution to Holders in liquidation of the Issuer after satisfaction of
liabilities to creditors of the Issuer as required by applicable law (in either
case, the "Liquidation Distribution").
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"Guarantee Trustee" means [-----------], until a Successor
Guarantee Trustee has been appointed and has accepted such appointment pursuant
to the terms of this Guarantee Agreement, and thereafter means each such
Successor Guarantee Trustee.
"Holder" means any holder, as registered on the books and
records of the Issuer, of any Securities; provided, however, that in determining
whether the holders of the requisite percentage of Securities have given any
request, notice, consent or waiver hereunder, "Holder" shall not include the
Guarantor, the Guarantee Trustee, or any Affiliate of the Guarantor or the
Guarantee Trustee.
"Indenture" means the Indenture of Subordinated Debt
Securities dated as of -----------, 1997, as supplemented and amended (including
pursuant to any supplemental indenture, board resolution or officers'
certificate establishing the terms of a series of Securities thereunder) between
the Guarantor and [--------------], as trustee.
"Issuer" has the meaning specified in the preamble to this
Guarantee Agreement.
"List of Holders" has the meaning specified in Section 2.2(a).
"Majority in aggregate Liquidation Amount of the Securities"
means, except as provided by the Trust Indenture Act, a vote by the Holder(s),
voting separately as a class, of more than 50% of the aggregate Liquidation
Amount of all then Outstanding (as defined in the Trust Agreement) Securities
issued by the Issuer.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman or a Vice Chairman of the Board of Directors
of such Person or the President or a Vice President of such Person, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
such Person, and delivered to the Guarantee Trustee. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Guarantee Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Officers' Certificate;
(c) a statement that each officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each officer,
such condition or covenant has been complied with.
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<PAGE>
"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" has the meaning specified in the
preamble to this Agreement.
"Responsible Officer" when used with respect to the Guarantee
Trustee means any officer of the Guarantee Trustee assigned by the Guarantee
Trustee from time to time to administer its corporate trust matters.
"Securities" has the meaning specified in the preamble to this
Agreement.
"Successor Guarantee Trustee" means a successor Guarantee
Trustee possessing the qualifications to act as Guarantee Trustee under Section
4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended.
ARTICLE II. TRUST INDENTURE ACT
Section 2.1. 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.
(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 imposed duties shall
control.
Section 2.2. List of Holders.
(a) The Guarantor will furnish or cause to be furnished to the
Guarantee Trustee:
(i) semi-annually, not more than 15 days after ---------- and
--------- in each year, a list, in such form as the Guarantee Trustee
may reasonably require, of the names and addresses of the Holders as of
such -------- and ---------, and
(ii) at such other times as the Guarantee Trustee may request
in writing, within 30 days after the receipt by the Guarantor of any
such request, a list of similar form and content as of a date not more
than 15 days prior to the time such list is
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<PAGE>
furnished, excluding from any such list names and addresses received by
the Guarantee Trustee in its capacity as Securities Registrar.
(b) The Guarantee Trustee shall comply with its obligations
under Section 311(a), Section 311(b) and Section 312(b) of the Trust Indenture
Act.
Section 2.3. Reports by the Guarantee Trustee.
The Guarantee Trustee shall transmit to Holders, and/or any
stock exchange upon which the Subordinated Debt Securities are listed, such
reports concerning the Guarantee Trustee and its actions under this Guarantee
Agreement as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto. If required by Section 313(a) of
the Trust Indenture Act, the Guarantee Trustee shall, within sixty days after
each [-------------] following the date of this Guarantee Agreement deliver to
Holders a brief report, dated as of such [-------------], which complies with
the provisions of such Section 313(a).
Section 2.4. Periodic Reports to the Guarantee Trustee.
The Guarantor shall provide to the Guarantee Trustee, the
Securities and Exchange Commission, and the Holders such documents, reports and
information, if any, as required by Section 314 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. Delivery of such reports, information and documents to the
Guarantee Trustee is for informational purposes only and the Guarantee Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein, including the Guarantor's compliance with any of its
covenants hereunder (as to which the Guarantee Trustee is entitled to rely
exclusively on Officers' Certificates).
Section 2.5. Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with such 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 an officer pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
Section 2.6. Events of Default; Waiver.
The Holders of a Majority in aggregate Liquidation Amount of
the Securities may, by vote, on behalf of the Holders, waive any past Event of
Default and its consequences. Upon such waiver, any such Event of Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Guarantee Agreement, but no such
waiver shall extend to any subsequent or other default or Event of Default or
impair any right consequent therefrom.
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<PAGE>
Section 2.7. Event of Default; Notice.
(a) The Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders (in the manner set forth in Section 313(c) of the Trust
Indenture Act), notices of all Events of Default actually known to the Guarantee
Trustee, unless such defaults have been cured before the giving of such notice,
provided, that, except in the case of a default in the payment of a Guarantee
Payment, the 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 Guarantee Trustee in
good faith determines that the withholding of such notice is in the interests of
the Holders.
(b) The Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the Guarantee Trustee shall have
received written notice, or a Responsible Officer charged with the
administration of this Guarantee Agreement shall have obtained written notice,
of such Event of Default.
Section 2.8. Conflicting Interests.
The Trust Agreement shall be deemed to be specifically
described in this Guarantee Agreement for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
Section 3.1. Powers and Duties of the Guarantee Trustee.
(a) This Guarantee Agreement shall be held by the Guarantee
Trustee for the benefit of the Holders, and the Guarantee Trustee shall not
transfer this Guarantee Agreement to any Person except a Holder exercising his
or her rights pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Successor Guarantee Trustee. The right, title and interest of the Guarantee
Trustee shall automatically vest in any Successor Guarantee Trustee, upon
acceptance by such Successor Guarantee Trustee of its appointment hereunder, 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 Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.
(c) The Guarantee Trustee, before the occurrence of any Event
of Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Guarantee Agreement, and no
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<PAGE>
implied covenants shall be read into this Guarantee Agreement against the
Guarantee Trustee. In case an Event of Default has occurred (that has not been
cured or waived pursuant to Section 2.6), the 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 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 Guarantee
Trustee shall be determined solely by the express provisions
of this Guarantee Agreement, and the 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
(B) in the absence of bad faith on the part of the
Guarantee Trustee, the 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 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 or of the Trust Indenture Act are specifically required
to be furnished to the Guarantee Trustee, the 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 Guarantee Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer of the
Guarantee Trustee, unless it shall be proved that the Guarantee Trustee
was negligent in ascertaining the pertinent facts upon which such
judgment was made;
(iii) the 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 aggregate Liquidation Amount of the Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Guarantee Trustee, or exercising any trust or power
conferred upon the Guarantee Trustee under this Guarantee Agreement;
and
(iv) no provision of this Guarantee Agreement shall require
the 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
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powers, if the 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 3.2. Certain Rights of Guarantee Trustee.
(a) Subject to the provisions of Section 3.1:
(i) The Guarantee Trustee may rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document reasonably 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 an
Officers' Certificate unless otherwise prescribed herein.
(iii) Whenever, in the administration of this Guarantee
Agreement, the Guarantee Trustee shall deem it desirable that a matter
be proved or established before taking, suffering or omitting to take
any action hereunder, the Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its
part, request and rely upon an Officers' Certificate which, upon
receipt of such request from the Guarantee Trustee, shall be promptly
delivered by the Guarantor.
(iv) The Guarantee Trustee may consult with legal counsel of
its selection, and the advice or opinion of such legal counsel with
respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be
taken by it hereunder in good faith and in accordance with such advice
or opinion. Such legal counsel may be legal counsel to the Guarantor or
any of its Affiliates and may be one of its employees. The 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.
(v) The 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 Guarantee Trustee such adequate security and
indemnity as would satisfy a reasonable person in the position of the
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 Guarantee Trustee; provided that,
nothing contained in this Section 3.2(a)(v) shall
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be taken to relieve the 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.
(vi) The 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 Guarantee Trustee, in
its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit.
(vii) The Guarantee Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through its agents or attorneys, and the Guarantee Trustee shall not
be responsible for any misconduct or negligence on the part of any such
agent or attorney appointed with due care by it hereunder.
(viii) Whenever in the administration of this Guarantee
Agreement the Guarantee Trustee shall deem it desirable to receive
written instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Guarantee Trustee (A) may
request written instructions from the Holders, (B) may refrain from
enforcing such remedy or right or taking such other action until such
written instructions are received, and (C) shall be protected in acting
in accordance with such written instructions.
(ix) The Guarantee Trustee shall not be liable for any action
taken, suffered, or omitted to be taken by it in good faith and
reasonably believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Guarantee Agreement.
(b) No provision of this Guarantee Agreement shall be deemed
to impose any duty or obligation on the 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 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 Guarantee Trustee
shall be construed to be a duty to act in accordance with such power and
authority.
Section 3.3. Indemnity.
The Guarantor agrees to indemnify the Guarantee Trustee for,
and to hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on the part of the Guarantee Trustee, arising out of or
in connection with the acceptance or administration of this Guarantee Agreement,
including the costs and expenses of defending
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itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.
ARTICLE IV. GUARANTEE TRUSTEE
Section 4.1. Guarantee Trustee: Eligibility.
(a) There shall at all times be a Guarantee Trustee which
shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of
at least $50,000,000, and shall be a corporation meeting the
requirements of Section 310(a) of the Trust Indenture Act. If such
corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of the supervising or examining
authority, then, for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, 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 Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Guarantee Trustee shall immediately
resign in the manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Guarantee Trustee and Guarantor shall in all respects comply
with the provisions of Section 310(b) of the Trust Indenture Act.
Section 4.2. Appointment, Removal and Resignation of the
Guarantee Trustee.
(a) Subject to Section 4.2(b), the Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
by written instrument executed by such Successor Guarantee Trustee and delivered
to the Guarantor. If an instrument of acceptance by a Successor Guarantee
Trustee shall not have been delivered to the Guarantee Trustee within 30 days
after such removal, the Guarantee Trustee being removed may petition any court
of competent jurisdiction for the appointment of a Successor Guarantee Trustee.
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<PAGE>
(c) The Guarantee Trustee appointed hereunder shall hold
office until a Successor Guarantee Trustee shall have been appointed or until
its removal or resignation. The Guarantee Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in writing
executed by the Guarantee Trustee and delivered to the Guarantor, which
resignation shall not take effect until a Successor Guarantee Trustee has been
appointed and has accepted such appointment by instrument in writing executed by
such Successor Guarantee Trustee and delivered to the Guarantor and the
resigning Guarantee Trustee.
(d) If no Successor Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within 60
days after delivery to the Guarantor of an instrument of resignation, the
resigning Guarantee Trustee may petition, at the expense of the Guarantor, any
court of competent jurisdiction for appointment of a Successor Guarantee
Trustee. Such court may thereupon, after prescribing such notice, if any, as it
may deem proper, appoint a Successor Guarantee Trustee.
ARTICLE V. GUARANTEE
Section 5.1. Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by or on behalf of the Issuer), as and when due, regardless of
any defense, right of set-off or counterclaim which the Issuer may have or
assert. It is understood that, pursuant to the Trust Agreement, Guarantee
Payments to the Holder of Common Securities are subordinated to Guarantee
Payments to the Holders of Preferred Securities if any event of default under
the Indenture has occurred and is continuing. 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 5.2. Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of the
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 Guarantee Trustee, 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 5.3. 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:
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(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 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 (other than an extension of time for payment
of Distributions that results from the extension of any interest payment period
on the Subordinated Debt Securities as provided in the Indenture), Redemption
Price, Liquidation Distribution or any other sums payable under the terms of the
Securities or the extension of time for the performance of any other obligation
under, arising out of, or in connection with, the Securities;
(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 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
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 5.3 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 the consent of, the
Guarantor with respect to the happening of any of the foregoing.
Section 5.4. Rights of Holders.
The Guarantor expressly acknowledges that: (i) this Guarantee
Agreement will be deposited with the Guarantee Trustee to be held for the
benefit of the Holders; (ii) the Guarantee Trustee has the right to enforce this
Guarantee Agreement on behalf of the Holders; (iii) the Holders of a Majority in
aggregate Liquidation Amount of the Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Guarantee Trustee in respect of this Guarantee Agreement or exercising any
trust or power conferred upon the Guarantee Trustee under this Guarantee
Agreement; and (iv) any Holder 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 Guarantee Trustee, the Issuer
or any other Person.
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Section 5.5. Guarantee of Payment
This Guarantee Agreement creates a guarantee of payment and
not of collection. This Guarantee Agreement will not be discharged except by
payment of the Guarantee Payments in full (without duplication of amounts
theretofore paid by the Issuer) or upon distribution of Subordinated Debt
Securities to Holders as provided in the Trust Agreement.
Section 5.6. Subrogation.
The Guarantor shall be subrogated to all (if any) rights of
the Holders against the Issuer in respect of any amounts paid to the Holders by
the Guarantor under this Guarantee Agreement and shall have the right to waive
payment by the Issuer pursuant to Section 5.1; 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 5.7. Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the 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 5.3 hereof.
ARTICLE VI. COVENANTS AND SUBORDINATION
Section 6.1. Subordination.
The obligations of the Guarantor under this Guarantee
Agreement will constitute unsecured obligations of the Guarantor and will rank
subordinate and junior in right of payment to all Senior Debt (as defined in the
Indenture) of the Guarantor, except those debts made pari passu or subordinate
to such obligations expressly by their terms, in the same manner as set forth in
Article 14 of the Indenture.
Section 6.2. Pari Passu Guarantees.
The obligations of the Guarantor under this Guarantee
Agreement shall rank pari passu with the obligations of the Guarantor under any
similar Guarantee Agreements
- 13 -
<PAGE>
issued by the Guarantor on behalf of the holders of preferred securities issued
by any Willamette Trust (as defined in the Indenture).
Section 6.3 Limitation of Transactions.
So long as any Preferred Securities remain outstanding, if
there shall have occurred an Event of Default hereunder or an Event of Default
under the Trust Agreement, the (a) the Guarantor shall not declare or pay any
dividend on, or make any distribution with respect to, or redeem, purchase,
acquire or make any liquidation payment with respect to, any of its capital
stock (other than (i) purchases or acquisitions of shares of common stock of the
Guarantor in connection with the satisfaction by the Guarantor of its
obligations under any employee benefit plans or the satisfaction by the
Guarantor of its obligations pursuant to any contract or security outstanding on
the date of such event requiring the Guarantor to purchase shares of its common
stock, (ii) as a result of a reclassification of the Guarantor's capital stock
or the exchange or conversion of one class or series of the Guarantor's capital
stock for another class or series of the Guarantor's capital stock, or (iii) the
purchase of fractional interests in shares of the Guarantor's capital stock
pursuant to the conversion or exchange provisions of the Guarantor's capital
stock or the security being converted or exchanged); (b) the Guarantor shall not
make any payment of interest, principal or premium, if any, on or repay,
repurchase or redeem any debt securities (including guarantees) issued by the
Guarantor which rank pari passu with or junior to the Subordinated Debt
Securities; and (c) the Guarantor shall not make any guarantee payments with
respect to the foregoing (other than pursuant to this Guarantee Agreement or any
similar Guarantee Agreements issued by the Guarantor on behalf of the holders of
Preferred Securities issued by any Willamette Trust (as defined in the
Indenture)).
Section 6.4 Corporate Existence.
The Guarantor covenants that so long as any of the Preferred
Securities are Outstanding, it will maintain its existence, will not dissolve,
sell or otherwise dispose of all or substantially all of its assets and will not
consolidate with or merge into another entity or permit one or more other
entities to consolidate with or merge into it; provided that the Guarantor may,
without violating the covenants in this Section 6.4, consolidate with or merger
into another entity or permit one or more other entities to consolidate with or
merge into it, or sell or otherwise transfer to another entity all or
substantially all of its assets as an entirety and thereafter dissolve, if the
surviving, resulting or transferee entity, as the case may be, (i) shall be
organized and existing under the laws of one of the States of the United States
of America, (ii) assumes, if such entity is not the Guarantor, all of the
obligations of the Guarantor hereunder and (iii) is not, after such transaction,
otherwise in default under any provisions hereof.
- 14 -
<PAGE>
ARTICLE VII. TERMINATION
Section 7.1. Termination.
This Guarantee Agreement shall terminate and be of no further
force and effect upon (i) full payment of the Redemption Price of all
Securities, (ii) the distribution of Subordinated Debt Securities to the Holders
in exchange for all of the Securities or (iii) full payment of the amounts
payable in accordance with the Trust Agreement 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
must restore payment of any sums paid with respect to Securities or this
Guarantee Agreement.
ARTICLE VIII. MISCELLANEOUS
Section 8.1. 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 Securities then outstanding. Except in connection with a consolidation,
merger or sale involving the Guarantor that is permitted under Article VIII of
the Indenture and pursuant to which the successor or assignee agrees in writing
to perform the Guarantor's obligations hereunder, the Guarantor shall not assign
its obligations hereunder.
Section 8.2. Amendments.
Except with respect to any changes which do not adversely
affect the rights of the Holders or the Guarantee Trustee in any material
respect (in which case no consent of the Holders or the Guarantee Trustee, as
the case may be, will be required), this Guarantee Agreement may only be amended
with the prior approval of the Holders of not less than a Majority in aggregate
Liquidation Amount of all the outstanding Securities and, where the Guarantee
Trustee is adversely affected, the prior approval of the Guarantee Trustee. The
provisions of Article VI of the Trust Agreement concerning meetings of the
Holders shall apply to the giving of such approval.
Section 8.3. Notices.
Any notice, request or other communication required or
permitted to be given hereunder shall be in writing, duly signed by the party
giving such notice, and delivered, telecopied or mailed by first class mail as
follows:
(a) if given to the Guarantor, to the address set forth below
or such other address, facsimile number or to the attention of such other Person
as the Guarantor may give notice to the Holders:
- 15 -
<PAGE>
Willamette Industries, Inc.
1300 S.W. Fifth Avenue
Suite 3800
Portland, Oregon 97201
Facsimile No.: 503-273-5604
Attention: Mr. J. A. Parsons
Chief Financial Officer
(b) if given to the Issuer, in care of the Guarantee Trustee,
at the Issuer's (and the Guarantee Trustee's) address set forth below or such
other address as the Guarantee Trustee on behalf of the Issuer may give notice
to the Holders:
Willamette Capital I
c/o Willamette Industries, Inc.
1300 S.W. Fifth Avenue
Suite 3800
Portland, Oregon 97201
Facsimile No.: 503-273-5604
Attention: Mr. G. W. Hawley
Vice President and Controller
with a copy to:
---------------------------
---------------------------
---------------------------
Facsimile No.: ------------
Attention: Corporate Trust Administration
(c) if given to any Holder, at the address set forth on the
books and records of the Issuer.
All notices hereunder 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 8.4. Consolidation, Merger, Conveyance, Transfer or
Lease.
The Guarantor shall not consolidate with or merge into any
other Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person,
- 16 -
<PAGE>
and no Person shall consolidate with or merge into the Guarantor or convey,
transfer or lease its properties and assets substantially as an entirety to the
Guarantor, unless it has complied with the terms of Section 8.1 of the
Indenture.
Section 8.5. Benefit.
This Guarantee Agreement is solely for the benefit of the
Holders and is not separately transferable from the Securities.
Section 8.6. Interpretation.
In this Guarantee Agreement, unless the context otherwise
requires:
(a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to them in
Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "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;
(f) a reference to the singular includes the plural and vice
versa; and
(g) the masculine, feminine or neuter genders used herein
shall include the masculine, feminine and neuter genders.
Section 8.7. Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
- 17 -
<PAGE>
THIS GUARANTEE AGREEMENT is executed as of the day and year
first above written.
WILLAMETTE INDUSTRIES, INC., as Guarantor
By: ------------------------------------
Name: J. A. Parsons
Title: Executive Vice President and Chief Financial Officer
- -----------------------------------------, as Guarantee Trustee
By: -------------------------------------
Name: -----------------------------------
Title: ----------------------------------
- 18 -
FORM OF
TRUST SECURITIES GUARANTEE
Between
WILLAMETTE INDUSTRIES, INC.
(as Guarantor)
and
(as Guarantee Trustee)
dated as of _____________, 1997
<PAGE>
CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Guarantee Agreement
310(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1(a)
310(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1(c), 2.8
310(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
311(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
312(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(a)
312(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
313. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
314(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
314(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5
314(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1, 2.5, 3.2
314(f). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1, 3.2
315(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(d)
315(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.7
315(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(c)
315(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(d)
316(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1, 2.6, 5.4
316(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3
316(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.2
317(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
317(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
318(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1(b)
318(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1
318(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1(a)
* 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.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE I. DEFINITIONS............................................................................2
Section 1.1. Definitions.....................................................................................2
ARTICLE II. TRUST INDENTURE ACT....................................................................4
Section 2.1. Trust Indenture Act; Application................................................................4
Section 2.2. List of Holders.................................................................................4
Section 2.3. Reports by the Guarantee Trustee................................................................5
Section 2.4. Periodic Reports to the Guarantee Trustee.......................................................5
Section 2.5. Evidence of Compliance with Conditions Precedent................................................5
Section 2.6. Events of Default; Waiver.......................................................................5
Section 2.7. Event of Default; Notice........................................................................6
Section 2.8. Conflicting Interests...........................................................................6
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE
TRUSTEE................................................................................6
Section 3.1. Powers and Duties of the Guarantee Trustee......................................................6
Section 3.2. Certain Rights of Guarantee Trustee.............................................................8
Section 3.3. Indemnity.......................................................................................9
ARTICLE IV. GUARANTEE TRUSTEE..............................................................................10
Section 4.1. Guarantee Trustee: Eligibility.................................................................10
Section 4.2. Appointment, Removal and Resignation of the Guarantee Trustee..................................10
ARTICLE V. GUARANTEE .....................................................................................11
Section 5.1. Guarantee......................................................................................11
Section 5.2. Waiver of Notice and Demand....................................................................11
Section 5.3. Obligations Not Affected.......................................................................11
Section 5.4. Rights of Holders..............................................................................12
Section 5.5. Guarantee of Payment...........................................................................13
Section 5.6. Subrogation....................................................................................13
Section 5.7. Independent Obligations........................................................................13
ARTICLE VI. COVENANTS AND SUBORDINATION....................................................................13
Section 6.1. Subordination..................................................................................13
Section 6.2. Pari Passu Guarantees..........................................................................13
Section 6.3. Limitation of Transactions.....................................................................14
Section 6.4. Corporate Existence............................................................................14
<PAGE>
ARTICLE VII. TERMINATION...........................................................................15
Section 7.1. Termination....................................................................................15
ARTICLE VIII. MISCELLANEOUS.........................................................................15
Section 8.1. Successors and Assigns.........................................................................15
Section 8.2. Amendments.....................................................................................15
Section 8.3. Notices........................................................................................15
Section 8.4. Consolidation, Merger, Conveyance, Transfer or Lease...........................................16
Section 8.5. Benefit........................................................................................17
Section 8.6. Interpretation.................................................................................17
Section 8.7. Governing Law..................................................................................17
</TABLE>
- 4 -
<PAGE>
TRUST SECURITIES GUARANTEE
This TRUST SECURITIES GUARANTEE, dated as of -------------,
1997, is executed and delivered by WILLAMETTE INDUSTRIES, INC., an Oregon
corporation (the "Guarantor"), having its principal office at 1300 S.W. Fifth
Avenue, Suite 3800, Portland, Oregon 97201, and
[--------------------------------] a banking corporation, as trustee (the
"Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Preferred Securities and Common Securities (each as defined
herein and together, the "Securities") of Willamette Capital II, a Delaware
statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of
Trust and Trust Agreement, dated as of -----------, 1997 (the "Trust
Agreement"), among the Guarantor, as Depositor, the Property Trustee and the
Delaware Trustee named therein, the Administrative Trustees named therein and
the Holders from time to time of undivided beneficial ownership interests in the
assets of the Issuer, the Issuer is issuing $------- aggregate Liquidation
Amount (as defined in the Trust Agreement) of its Preferred Securities,
Liquidation Amount $---- per preferred security) (the "Preferred Securities")
representing undivided beneficial ownership interests in the assets of the
Issuer and having the terms set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Issuer
and the proceeds thereof, together with the proceeds from the issuance of the
Issuer's Common Securities (as defined herein), will be used to purchase the
Subordinated Debt Securities (as defined in the Trust Agreement) of the
Guarantor which will be deposited with [---------------------------------], as
Property Trustee under the Trust Agreement, as trust assets; and
WHEREAS, as incentive for the Holders to purchase Securities
the Guarantor desires irrevocably and unconditionally to agree, to the extent
set forth herein, to pay to the Holders of the Securities the Guarantee Payments
(as defined herein) and to make certain other payments on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each
Holder of 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 from time to time of the Securities.
- 1 -
<PAGE>
ARTICLE I. DEFINITIONS
Section 1.1. Definitions.
As used in this Guarantee Agreement, the terms set forth below
shall, unless the context otherwise requires, have the following meanings.
Capitalized or otherwise defined terms used but not otherwise defined herein
shall have the meanings assigned to such terms in the Trust Agreement as in
effect on the date hereof.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person; provided, however, that an Affiliate
of the Guarantor shall not be deemed to be an Affiliate of the Issuer. For the
purposes of this definition, "control" when used with respect to any specified
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Board of Directors" means either the board of directors of
the Guarantor or any committee of that board duly authorized to act hereunder.
"Common Securities" means the securities representing common
undivided beneficial ownership interests in the assets of the Issuer.
"Event of Default" means a failure by the Guarantor to perform
any of its payment or other obligations under this Guarantee Agreement;
provided, however, that, except with respect to a default in payment of any
Guarantee Payments, the Guarantor shall have received notice of default and
shall not have cured such default within 90 days after receipt of such notice.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Securities, to the
extent not paid or made by or on behalf of the Issuer: (i) any accrued and
unpaid Distributions (as defined in the Trust Agreement) required to be paid on
the Securities, to the extent the Issuer shall have funds on hand available
therefor at such time, (ii) the redemption price, including all accrued and
unpaid Distributions to the date of redemption (the"Redemption Price"), with
respect to any Securities called for redemption by the Issuer, to the extent the
Issuer shall have funds on hand available therefor at such time, and (iii) upon
a voluntary or involuntary termination, winding up or liquidation of the Issuer
(other than in connection with the distribution of Subordinated Debt Securities
to the Holders or the redemption of all the Securities), the lesser of (a) the
aggregate of the Liquidation Amount plus accrued and unpaid Distributions to the
date of payment, to the extent the Issuer has funds available therefor at such
time, and (b) the amount of assets of the Issuer remaining available for
distribution to Holders in liquidation of the Issuer after satisfaction of
liabilities to creditors of the Issuer as required by applicable law (in either
case, the "Liquidation Distribution").
- 2 -
<PAGE>
"Guarantee Trustee" means [-----------], until a Successor
Guarantee Trustee has been appointed and has accepted such appointment pursuant
to the terms of this Guarantee Agreement, and thereafter means each such
Successor Guarantee Trustee.
"Holder" means any holder, as registered on the books and
records of the Issuer, of any Securities; provided, however, that in determining
whether the holders of the requisite percentage of Securities have given any
request, notice, consent or waiver hereunder, "Holder" shall not include the
Guarantor, the Guarantee Trustee, or any Affiliate of the Guarantor or the
Guarantee Trustee.
"Indenture" means the Indenture of Subordinated Debt
Securities dated as of -----------, 1997, as supplemented and amended (including
pursuant to any supplemental indenture, board resolution or officers'
certificate establishing the terms of a series of Securities thereunder) between
the Guarantor and [--------------], as trustee.
"Issuer" has the meaning specified in the preamble to this
Guarantee Agreement.
"List of Holders" has the meaning specified in Section 2.2(a).
"Majority in aggregate Liquidation Amount of the Securities"
means, except as provided by the Trust Indenture Act, a vote by the Holder(s),
voting separately as a class, of more than 50% of the aggregate Liquidation
Amount of all then Outstanding (as defined in the Trust Agreement) Securities
issued by the Issuer.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman or a Vice Chairman of the Board of Directors
of such Person or the President or a Vice President of such Person, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
such Person, and delivered to the Guarantee Trustee. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Guarantee Agreement shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Officers' Certificate;
(c) a statement that each officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each officer,
such condition or covenant has been complied with.
- 3 -
<PAGE>
"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" has the meaning specified in the
preamble to this Agreement.
"Responsible Officer" when used with respect to the Guarantee
Trustee means any officer of the Guarantee Trustee assigned by the Guarantee
Trustee from time to time to administer its corporate trust matters.
"Securities" has the meaning specified in the preamble to this
Agreement.
"Successor Guarantee Trustee" means a successor Guarantee
Trustee possessing the qualifications to act as Guarantee Trustee under Section
4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended.
ARTICLE II. TRUST INDENTURE ACT
Section 2.1. 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.
(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 imposed duties shall
control.
Section 2.2. List of Holders.
(a) The Guarantor will furnish or cause to be furnished to the
Guarantee Trustee:
(i) semi-annually, not more than 15 days after ---------- and
--------- in each year, a list, in such form as the Guarantee Trustee
may reasonably require, of the names and addresses of the Holders as of
such -------- and ---------, and
(ii) at such other times as the Guarantee Trustee may request
in writing, within 30 days after the receipt by the Guarantor of any
such request, a list of similar form and content as of a date not more
than 15 days prior to the time such list is
- 4 -
<PAGE>
furnished, excluding from any such list names and addresses received by
the Guarantee Trustee in its capacity as Securities Registrar.
(b) The Guarantee Trustee shall comply with its obligations
under Section 311(a), Section 311(b) and Section 312(b) of the Trust Indenture
Act.
Section 2.3. Reports by the Guarantee Trustee.
The Guarantee Trustee shall transmit to Holders, and/or any
stock exchange upon which the Subordinated Debt Securities are listed, such
reports concerning the Guarantee Trustee and its actions under this Guarantee
Agreement as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto. If required by Section 313(a) of
the Trust Indenture Act, the Guarantee Trustee shall, within sixty days after
each [-------------] following the date of this Guarantee Agreement deliver to
Holders a brief report, dated as of such [-------------], which complies with
the provisions of such Section 313(a).
Section 2.4. Periodic Reports to the Guarantee Trustee.
The Guarantor shall provide to the Guarantee Trustee, the
Securities and Exchange Commission, and the Holders such documents, reports and
information, if any, as required by Section 314 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. Delivery of such reports, information and documents to the
Guarantee Trustee is for informational purposes only and the Guarantee Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein, including the Guarantor's compliance with any of its
covenants hereunder (as to which the Guarantee Trustee is entitled to rely
exclusively on Officers' Certificates).
Section 2.5. Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with such 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 an officer pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
Section 2.6. Events of Default; Waiver.
The Holders of a Majority in aggregate Liquidation Amount of
the Securities may, by vote, on behalf of the Holders, waive any past Event of
Default and its consequences. Upon such waiver, any such Event of Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Guarantee Agreement, but no such
waiver shall extend to any subsequent or other default or Event of Default or
impair any right consequent therefrom.
- 5 -
<PAGE>
Section 2.7. Event of Default; Notice.
(a) The Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders (in the manner set forth in Section 313(c) of the Trust
Indenture Act), notices of all Events of Default actually known to the Guarantee
Trustee, unless such defaults have been cured before the giving of such notice,
provided, that, except in the case of a default in the payment of a Guarantee
Payment, the 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 Guarantee Trustee in
good faith determines that the withholding of such notice is in the interests of
the Holders.
(b) The Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the Guarantee Trustee shall have
received written notice, or a Responsible Officer charged with the
administration of this Guarantee Agreement shall have obtained written notice,
of such Event of Default.
Section 2.8. Conflicting Interests.
The Trust Agreement shall be deemed to be specifically
described in this Guarantee Agreement for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
Section 3.1. Powers and Duties of the Guarantee Trustee.
(a) This Guarantee Agreement shall be held by the Guarantee
Trustee for the benefit of the Holders, and the Guarantee Trustee shall not
transfer this Guarantee Agreement to any Person except a Holder exercising his
or her rights pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Successor Guarantee Trustee. The right, title and interest of the Guarantee
Trustee shall automatically vest in any Successor Guarantee Trustee, upon
acceptance by such Successor Guarantee Trustee of its appointment hereunder, 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 Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.
(c) The Guarantee Trustee, before the occurrence of any Event
of Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Guarantee Agreement, and no
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implied covenants shall be read into this Guarantee Agreement against the
Guarantee Trustee. In case an Event of Default has occurred (that has not been
cured or waived pursuant to Section 2.6), the 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 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 Guarantee
Trustee shall be determined solely by the express provisions
of this Guarantee Agreement, and the 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
(B) in the absence of bad faith on the part of the
Guarantee Trustee, the 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 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 or of the Trust Indenture Act are specifically required
to be furnished to the Guarantee Trustee, the 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 Guarantee Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer of the
Guarantee Trustee, unless it shall be proved that the Guarantee Trustee
was negligent in ascertaining the pertinent facts upon which such
judgment was made;
(iii) the 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 aggregate Liquidation Amount of the Securities relating to
the time, method and place of conducting any proceeding for any remedy
available to the Guarantee Trustee, or exercising any trust or power
conferred upon the Guarantee Trustee under this Guarantee Agreement;
and
(iv) no provision of this Guarantee Agreement shall require
the 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
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powers, if the 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 3.2. Certain Rights of Guarantee Trustee.
(a) Subject to the provisions of Section 3.1:
(i) The Guarantee Trustee may rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document reasonably 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 an
Officers' Certificate unless otherwise prescribed herein.
(iii) Whenever, in the administration of this Guarantee
Agreement, the Guarantee Trustee shall deem it desirable that a matter
be proved or established before taking, suffering or omitting to take
any action hereunder, the Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its
part, request and rely upon an Officers' Certificate which, upon
receipt of such request from the Guarantee Trustee, shall be promptly
delivered by the Guarantor.
(iv) The Guarantee Trustee may consult with legal counsel of
its selection, and the advice or opinion of such legal counsel with
respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be
taken by it hereunder in good faith and in accordance with such advice
or opinion. Such legal counsel may be legal counsel to the Guarantor or
any of its Affiliates and may be one of its employees. The 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.
(v) The 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 Guarantee Trustee such adequate security and
indemnity as would satisfy a reasonable person in the position of the
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 Guarantee Trustee; provided that,
nothing contained in this Section 3.2(a)(v) shall
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be taken to relieve the 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.
(vi) The 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 Guarantee Trustee, in
its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit.
(vii) The Guarantee Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through its agents or attorneys, and the Guarantee Trustee shall not
be responsible for any misconduct or negligence on the part of any such
agent or attorney appointed with due care by it hereunder.
(viii) Whenever in the administration of this Guarantee
Agreement the Guarantee Trustee shall deem it desirable to receive
written instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Guarantee Trustee (A) may
request written instructions from the Holders, (B) may refrain from
enforcing such remedy or right or taking such other action until such
written instructions are received, and (C) shall be protected in acting
in accordance with such written instructions.
(ix) The Guarantee Trustee shall not be liable for any action
taken, suffered, or omitted to be taken by it in good faith and
reasonably believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Guarantee Agreement.
(b) No provision of this Guarantee Agreement shall be deemed
to impose any duty or obligation on the 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 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 Guarantee Trustee
shall be construed to be a duty to act in accordance with such power and
authority.
Section 3.3. Indemnity.
The Guarantor agrees to indemnify the Guarantee Trustee for,
and to hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on the part of the Guarantee Trustee, arising out of or
in connection with the acceptance or administration of this Guarantee Agreement,
including the costs and expenses of defending
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itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.
ARTICLE IV. GUARANTEE TRUSTEE
Section 4.1. Guarantee Trustee: Eligibility.
(a) There shall at all times be a Guarantee Trustee which
shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of
at least $50,000,000, and shall be a corporation meeting the
requirements of Section 310(a) of the Trust Indenture Act. If such
corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of the supervising or examining
authority, then, for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, 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 Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Guarantee Trustee shall immediately
resign in the manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Guarantee Trustee and Guarantor shall in all respects comply
with the provisions of Section 310(b) of the Trust Indenture Act.
Section 4.2. Appointment, Removal and Resignation of the
Guarantee Trustee.
(a) Subject to Section 4.2(b), the Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
by written instrument executed by such Successor Guarantee Trustee and delivered
to the Guarantor. If an instrument of acceptance by a Successor Guarantee
Trustee shall not have been delivered to the Guarantee Trustee within 30 days
after such removal, the Guarantee Trustee being removed may petition any court
of competent jurisdiction for the appointment of a Successor Guarantee Trustee.
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(c) The Guarantee Trustee appointed hereunder shall hold
office until a Successor Guarantee Trustee shall have been appointed or until
its removal or resignation. The Guarantee Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in writing
executed by the Guarantee Trustee and delivered to the Guarantor, which
resignation shall not take effect until a Successor Guarantee Trustee has been
appointed and has accepted such appointment by instrument in writing executed by
such Successor Guarantee Trustee and delivered to the Guarantor and the
resigning Guarantee Trustee.
(d) If no Successor Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within 60
days after delivery to the Guarantor of an instrument of resignation, the
resigning Guarantee Trustee may petition, at the expense of the Guarantor, any
court of competent jurisdiction for appointment of a Successor Guarantee
Trustee. Such court may thereupon, after prescribing such notice, if any, as it
may deem proper, appoint a Successor Guarantee Trustee.
ARTICLE V. GUARANTEE
Section 5.1. Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by or on behalf of the Issuer), as and when due, regardless of
any defense, right of set-off or counterclaim which the Issuer may have or
assert. It is understood that, pursuant to the Trust Agreement, Guarantee
Payments to the Holder of Common Securities are subordinated to Guarantee
Payments to the Holders of Preferred Securities if any event of default under
the Indenture has occurred and is continuing. 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 5.2. Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of the
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 Guarantee Trustee, 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 5.3. 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:
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(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 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 (other than an extension of time for payment
of Distributions that results from the extension of any interest payment period
on the Subordinated Debt Securities as provided in the Indenture), Redemption
Price, Liquidation Distribution or any other sums payable under the terms of the
Securities or the extension of time for the performance of any other obligation
under, arising out of, or in connection with, the Securities;
(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 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
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 5.3 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 the consent of, the
Guarantor with respect to the happening of any of the foregoing.
Section 5.4. Rights of Holders.
The Guarantor expressly acknowledges that: (i) this Guarantee
Agreement will be deposited with the Guarantee Trustee to be held for the
benefit of the Holders; (ii) the Guarantee Trustee has the right to enforce this
Guarantee Agreement on behalf of the Holders; (iii) the Holders of a Majority in
aggregate Liquidation Amount of the Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Guarantee Trustee in respect of this Guarantee Agreement or exercising any
trust or power conferred upon the Guarantee Trustee under this Guarantee
Agreement; and (iv) any Holder 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 Guarantee Trustee, the Issuer
or any other Person.
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Section 5.5. Guarantee of Payment
This Guarantee Agreement creates a guarantee of payment and
not of collection. This Guarantee Agreement will not be discharged except by
payment of the Guarantee Payments in full (without duplication of amounts
theretofore paid by the Issuer) or upon distribution of Subordinated Debt
Securities to Holders as provided in the Trust Agreement.
Section 5.6. Subrogation.
The Guarantor shall be subrogated to all (if any) rights of
the Holders against the Issuer in respect of any amounts paid to the Holders by
the Guarantor under this Guarantee Agreement and shall have the right to waive
payment by the Issuer pursuant to Section 5.1; 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 5.7. Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the 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 5.3 hereof.
ARTICLE VI. COVENANTS AND SUBORDINATION
Section 6.1. Subordination.
The obligations of the Guarantor under this Guarantee
Agreement will constitute unsecured obligations of the Guarantor and will rank
subordinate and junior in right of payment to all Senior Debt (as defined in the
Indenture) of the Guarantor, except those debts made pari passu or subordinate
to such obligations expressly by their terms, in the same manner as set forth in
Article 14 of the Indenture.
Section 6.2. Pari Passu Guarantees.
The obligations of the Guarantor under this Guarantee
Agreement shall rank pari passu with the obligations of the Guarantor under any
similar Guarantee Agreements
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issued by the Guarantor on behalf of the holders of preferred securities issued
by any Willamette Trust (as defined in the Indenture).
Section 6.3 Limitation of Transactions.
So long as any Preferred Securities remain outstanding, if
there shall have occurred an Event of Default hereunder or an Event of Default
under the Trust Agreement, the (a) the Guarantor shall not declare or pay any
dividend on, or make any distribution with respect to, or redeem, purchase,
acquire or make any liquidation payment with respect to, any of its capital
stock (other than (i) purchases or acquisitions of shares of common stock of the
Guarantor in connection with the satisfaction by the Guarantor of its
obligations under any employee benefit plans or the satisfaction by the
Guarantor of its obligations pursuant to any contract or security outstanding on
the date of such event requiring the Guarantor to purchase shares of its common
stock, (ii) as a result of a reclassification of the Guarantor's capital stock
or the exchange or conversion of one class or series of the Guarantor's capital
stock for another class or series of the Guarantor's capital stock, or (iii) the
purchase of fractional interests in shares of the Guarantor's capital stock
pursuant to the conversion or exchange provisions of the Guarantor's capital
stock or the security being converted or exchanged); (b) the Guarantor shall not
make any payment of interest, principal or premium, if any, on or repay,
repurchase or redeem any debt securities (including guarantees) issued by the
Guarantor which rank pari passu with or junior to the Subordinated Debt
Securities; and (c) the Guarantor shall not make any guarantee payments with
respect to the foregoing (other than pursuant to this Guarantee Agreement or any
similar Guarantee Agreements issued by the Guarantor on behalf of the holders of
Preferred Securities issued by any Willamette Trust (as defined in the
Indenture)).
Section 6.4 Corporate Existence.
The Guarantor covenants that so long as any of the Preferred
Securities are Outstanding, it will maintain its existence, will not dissolve,
sell or otherwise dispose of all or substantially all of its assets and will not
consolidate with or merge into another entity or permit one or more other
entities to consolidate with or merge into it; provided that the Guarantor may,
without violating the covenants in this Section 6.4, consolidate with or merger
into another entity or permit one or more other entities to consolidate with or
merge into it, or sell or otherwise transfer to another entity all or
substantially all of its assets as an entirety and thereafter dissolve, if the
surviving, resulting or transferee entity, as the case may be, (i) shall be
organized and existing under the laws of one of the States of the United States
of America, (ii) assumes, if such entity is not the Guarantor, all of the
obligations of the Guarantor hereunder and (iii) is not, after such transaction,
otherwise in default under any provisions hereof.
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ARTICLE VII. TERMINATION
Section 7.1. Termination.
This Guarantee Agreement shall terminate and be of no further
force and effect upon (i) full payment of the Redemption Price of all
Securities, (ii) the distribution of Subordinated Debt Securities to the Holders
in exchange for all of the Securities or (iii) full payment of the amounts
payable in accordance with the Trust Agreement 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
must restore payment of any sums paid with respect to Securities or this
Guarantee Agreement.
ARTICLE VIII. MISCELLANEOUS
Section 8.1. 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 Securities then outstanding. Except in connection with a consolidation,
merger or sale involving the Guarantor that is permitted under Article VIII of
the Indenture and pursuant to which the successor or assignee agrees in writing
to perform the Guarantor's obligations hereunder, the Guarantor shall not assign
its obligations hereunder.
Section 8.2. Amendments.
Except with respect to any changes which do not adversely
affect the rights of the Holders or the Guarantee Trustee in any material
respect (in which case no consent of the Holders or the Guarantee Trustee, as
the case may be, will be required), this Guarantee Agreement may only be amended
with the prior approval of the Holders of not less than a Majority in aggregate
Liquidation Amount of all the outstanding Securities and, where the Guarantee
Trustee is adversely affected, the prior approval of the Guarantee Trustee. The
provisions of Article VI of the Trust Agreement concerning meetings of the
Holders shall apply to the giving of such approval.
Section 8.3. Notices.
Any notice, request or other communication required or
permitted to be given hereunder shall be in writing, duly signed by the party
giving such notice, and delivered, telecopied or mailed by first class mail as
follows:
(a) if given to the Guarantor, to the address set forth below
or such other address, facsimile number or to the attention of such other Person
as the Guarantor may give notice to the Holders:
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Willamette Industries, Inc.
1300 S.W. Fifth Avenue
Suite 3800
Portland, Oregon 97201
Facsimile No.: 503-273-5604
Attention: Mr. J. A. Parsons
Chief Financial Officer
(b) if given to the Issuer, in care of the Guarantee Trustee,
at the Issuer's (and the Guarantee Trustee's) address set forth below or such
other address as the Guarantee Trustee on behalf of the Issuer may give notice
to the Holders:
Willamette Capital II
c/o Willamette Industries, Inc.
1300 S.W. Fifth Avenue
Suite 3800
Portland, Oregon 97201
Facsimile No.: 503-273-5604
Attention: Mr. G. W. Hawley
Vice President and Controller
with a copy to:
---------------------------
---------------------------
---------------------------
Facsimile No.: ------------
Attention: Corporate Trust Administration
(c) if given to any Holder, at the address set forth on the
books and records of the Issuer.
All notices hereunder 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 8.4. Consolidation, Merger, Conveyance, Transfer or
Lease.
The Guarantor shall not consolidate with or merge into any
other Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person,
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and no Person shall consolidate with or merge into the Guarantor or convey,
transfer or lease its properties and assets substantially as an entirety to the
Guarantor, unless it has complied with the terms of Section 8.1 of the
Indenture.
Section 8.5. Benefit.
This Guarantee Agreement is solely for the benefit of the
Holders and is not separately transferable from the Securities.
Section 8.6. Interpretation.
In this Guarantee Agreement, unless the context otherwise
requires:
(a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to them in
Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "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;
(f) a reference to the singular includes the plural and vice
versa; and
(g) the masculine, feminine or neuter genders used herein
shall include the masculine, feminine and neuter genders.
Section 8.7. Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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THIS GUARANTEE AGREEMENT is executed as of the day and year
first above written.
WILLAMETTE INDUSTRIES, INC., as Guarantor
By: ------------------------------------
Name: J. A. Parsons
Title: Executive Vice President and Chief Financial Officer
- -----------------------------------------, as Guarantee Trustee
By: -------------------------------------
Name: -----------------------------------
Title: ----------------------------------
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