UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1998
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM _______ TO _______
COMMISSION FILE NUMBER 1-3551
EQUITABLE RESOURCES, INC.
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 25-0464690
(State of incorporation or organization) (IRS Employer Identification No.)
420 Boulevard of the Allies, Pittsburgh, Pennsylvania 15219
(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code: (412) 261-3000
------------
NONE
(Former name, former address and former fiscal year,
if changed since last report)
------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
Indicate the number of shares outstanding of each of issuer's classes of common
stock, as of the close of the period covered by this report.
Outstanding at
Class June 30, 1998
Common stock, no par value 37,100,000 shares
<PAGE>
EQUITABLE RESOURCES, INC. AND SUBSIDIARIES
Index
Page No.
Part I. Financial Statements:
Statements of Consolidated Income for the Three and
Six Months Ended June 30, 1998 and 1997 1
Statements of Condensed Consolidated Cash Flows
for the Three and Six Months Ended June 30, 1998
and 1997 2
Consolidated Balance Sheets, June 30, 1998,
and December 31, 1997 3 - 4
Notes to Consolidated Financial Statements 5 - 7
Information by Business Segment 8
Management's Discussion and Analysis of
Financial Condition and Results of Operations 9 - 17
Part II. Other Information 18 - 19
Signature 20
<PAGE>
<TABLE>
<CAPTION>
EQUITABLE RESOURCES, INC. AND SUBSIDIARIES
Statements of Consolidated Income (Unaudited)
(Thousands Except Per Share Amounts)
Three Months Ended Six Months Ended
June 30, June 30,
1998 1997 1998 1997
----------------------------- -----------------------------
Restated Restated
<S> <C> <C> <C> <C>
Operating revenues $ 182,097 $ 177,896 $ 475,329 $ 482,052
Cost of energy purchased 94,430 82,288 255,834 249,872
----------- ----------- ----------- -----------
Net operating revenues 87,667 95,608 219,495 232,180
----------- ----------- ----------- -----------
Operating expenses:
Operation 43,464 54,067 89,888 103,635
Maintenance 6,566 7,915 11,810 14,587
Depreciation, depletion and amortization 19,764 17,302 39,416 34,279
Taxes other than income 4,508 7,818 16,174 21,836
Impairment of assets - 13,000 - 13,000
----------- ----------- ----------- -----------
Total operating expenses 74,302 100,102 157,288 187,337
----------- ----------- ----------- -----------
13,365 (4,494) 62,207 44,843
Other income 374 530 298 687
Interest charges 10,262 9,219 20,852 18,942
----------- ----------- ----------- -----------
Income (loss) before income taxes 3,477 (13,183) 41,653 26,588
Income taxes (benefits) 1,203 (5,452) 14,727 9,081
----------- ----------- ----------- -----------
Net income (loss) from continuing operations 2,274 (7,731) 26,926 17,507
Income (loss) from discontinued operations after taxes - (1,532) (4,604) 1,020
----------- ----------- ----------- -----------
Net income (loss) $ 2,274 $ (9,263) $ 22,322 $ 18,527
=========== =========== =========== ===========
Average common shares outstanding 37,050 35,289 36,953 35,355
=========== =========== =========== ===========
Earnings (loss) per share of common stock - basic/diluted:
Continuing operations $ 0.06 $ (0.22) $ 0.72 $ 0.49
Discontinued operations - (0.04) (0.12) 0.03
----------- ----------- ----------- -----------
Net income $ 0.06 $ 0.26 $ 0.60 $ 0.52
=========== =========== =========== ===========
Dividends per share of common stock $ - $ - $ 0.59 $ 0.59
=========== =========== =========== ===========
<FN>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EQUITABLE RESOURCES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows (Unaudited)
(Thousands)
Three Months Ended Six Months Ended
June 30, June 30,
1998 1997 1998 1997
-------------------------- ---------------------------
Restated Restated
<S> <C> <C> <C> <C>
Cash flows from operating activities $ 67,311 $ 13,395 $ 114,967 $ 71,490
Cash flows from investing activities:
Capital expenditures (52,018) (28,895) (77,674) (47,577)
Proceeds from sale of property - 97 - 313
Additions to net assets of discontinued operations (9,730) (3,445) (13,741) (4,595)
---------- ---------- ----------- -----------
Net cash used in investing activities (61,748) (32,243) (91,415) (51,859)
---------- ---------- ----------- -----------
Cash flows from financing activities:
Retirement of long-term debt (5,880) (157) (10,880) (157)
Increase (decrease) in short-term loans (118,001) 35,769 (146,791) 51,201
Dividends paid - - (21,878) (20,648)
Proceeds from issuance of preferred trust securities 125,000 - 125,000 -
Proceeds from issuance of common stock 350 314 1,755 354
Purchase of treasury stock - (23,751) - (23,751)
---------- ---------- ----------- -----------
Net cash used in financing activities 1,469 12,175 (52,794) 6,999
---------- ---------- ----------- -----------
Net increase (decrease) in cash and cash equivalents 7,032 (6,673) (29,242) 26,630
Cash and cash equivalents at beginning of period 33,168 48,088 69,442 14,737
---------- ---------- ----------- -----------
Cash and cash equivalents at end of period $ 40,200 $ 41,415 $ 40,200 $ 41,367
========== ========== =========== ===========
Cash paid during the period for:
Interest (net of amount capitalized) $ 1,860 $ 2,358 $ 18,710 $ 15,037
========== ========== =========== ===========
Income taxes $ 8,345 $ 10,500 $ 9,854 $ 5,273
========== ========== =========== ===========
<FN>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EQUITABLE RESOURCES, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)
ASSETS June 30, December 31,
1998 1997
-----------------------------------
(Thousands)
-----------------------------------
Restated
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 40,200 $ 69,442
Accounts receivable 263,855 360,713
Unbilled revenues 10,197 25,935
Inventory 23,224 37,156
Deferred purchased gas cost 35,714 44,053
Derivative commodity instruments, at fair value 97,614 82,912
Prepaid expenses and other 59,402 64,523
-------------- --------------
Total current assets 530,206 684,734
-------------- --------------
Property, plant and equipment 1,928,723 1,862,412
Less accumulated depreciation and depletion 707,105 675,410
-------------- --------------
Net property, plant and equipment 1,221,618 1,187,002
-------------- --------------
Net assets of discontinued operations 250,236 238,182
-------------- --------------
Other assets 214,094 218,133
-------------- --------------
Total $ 2,216,154 $ 2,328,051
============== ==============
<FN>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EQUITABLE RESOURCES, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)
LIABILITIES AND STOCKHOLDERS EQUITY June 30, December 31,
1998 1997
-----------------------------------
(Thousands)
-----------------------------------
Restated
<S> <C> <C>
Current liabilities:
Short-term loans $ 134,653 $ 286,444
Accounts payable 185,218 288,192
Derivative commodity instruments, at fair value 96,210 79,012
Other current liabilities 109,442 92,053
-------------- --------------
Total current liabilities 525,523 745,701
-------------- --------------
Long-term debt 412,174 417,564
Deferred and other credits 323,907 341,266
Commitments and contingencies - -
Preferred trust securities 125,000 -
Capitalization:
Common stockholders' equity:
Common stock, no par value, authorized 80,000
shares; shares issued June 30,1998, 37,109;
December 31, 1997, 36,929 275,467 269,878
Retained earnings 555,687 555,246
Treasury stock, shares at cost June 30, 1998,
56; December 31, 1997, 56 (1,551) (1,551)
Accumulated other comprehensive income (53) (53)
-------------- --------------
Total common stockholders' equity 829,550 823,520
-------------- --------------
Total $ 2,216,154 $ 2,328,051
============== ==============
<FN>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
</FN>
</TABLE>
<PAGE>
Equitable Resources, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Unaudited)
A. The accompanying financial statements should be read in conjunction
with the Company's 1997 Annual Report and Form 10-K.
B. In the opinion of the Company, the accompanying unaudited condensed
consolidated financial statements contain all adjustments necessary to
present fairly the financial position as of June 30, 1998 and 1997, and
the results of operations and cash flows for the three months and six
months then ended. All adjustments are of a normal, recurring nature
unless otherwise indicated.
C. The results of operations for the three- and six-month periods ended June
30, 1998 and 1997, are not indicative of results for a full year because
of the seasonal nature of the Company's natural gas distribution
operations.
D. In April 1998 management adopted a formal plan to sell the Company's
natural gas midstream operations. The operations include an integrated
gas gathering, processing and storage system in Louisiana and a natural
gas and electricity marketing business based in Houston. The condensed
consolidated financial statements have been restated to classify these as
discontinued operations. Management believes that the operations will be
sold in the fourth quarter of 1998.
Net income (loss) from discontinued operations was $1.0 million for the
six months ended June 30, 1997 and ($4.6) million for the six months
ended June 30, 1998. These results were reported net of income tax
expense (benefit) of $.06 million and $(2.3) million in 1997 and 1998,
respectively.
Interest expense allocated to discontinued operations was $4.0 million in
the first six months of 1998 and $3.5 million in the first six months of
1997.
Proceeds from the sale of the midstream operations are expected to be
adequate to exceed estimated losses from operations and costs of
disposal.
The net assets of discontinued operations are summarized as follows:
June 30, 1998 December 31, 1997
------------------------------------------
(millions)
Property, plant and equipment $ 326.8 $ 319.5
Deferred credits (86.6) (81.3)
-------------- --------------
$ 250.2 $ 238.2
============== ==============
<PAGE>
Equitable Resources, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Unaudited)
E. In April 1998, $125 million of 7.35% Trust Preferred Capital Securities
were issued. The capital securities were issued through a subsidiary trust,
Equitable Resources Capital Trust I, established for the purpose of issuing
the capital securities and investing the proceeds in 7.35% Junior
Subordinated Debentures issued by the Company. The capital securities have
a mandatory redemption date of April 15, 2038; however, at the Company's
option, the securities may be redeemed on or after April 23, 2003. Proceeds
were used to reduce short-term debt outstanding. Interest expense for the
three- and six-months ended June 30, 1998, includes $1.7 million of
preferred dividends related to the trust preferred capital securities.
F. Comprehensive Income
In June 1997 the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 130, "Reporting
Comprehensive Income" (SFAS No. 130). SFAS No. 130 established new rules
for the reporting and display of comprehensive income and its components;
however, the adoption of this statement had no impact on the Company's
net income or shareholders' equity. SFAS No. 130 requires foreign currency
translation adjustments, which prior to adoption were reported separately
in shareholders' equity, to be reported as other comprehensive income.
Prior year financial statements have been reclassified to conform to
the requirements of SFAS No. 130.
During the six months ended June 30, 1998 and 1997, total comprehensive
income (which includes net income) amounted to $22,322,000 and $18,803,000,
respectively.
G. Software Costs
Statement of Position 98-1, "Accounting for the Costs of Computer Software
Developed or Obtained for Internal Use" (SOP 98-1) requires the
capitalization of certain costs incurred in connection with developing or
obtaining software for internal use. Qualifying software costs are
capitalized and amortized over the estimated useful life of the software.
The adoption of SOP 98-1 did not have a material impact on the Company's
financial position or results of operations.
H. Segment Disclosure
Statement of Financial Accounting Standards No. 131, "Disclosures about
Segments of an Enterprise and Related Information" (SFAS No. 131),
establishes new standards for reporting information about operating
segments in interim and annual financial statements. This statement is
effective for 1998 year-end financial statements. The company has not yet
determined what effect SFAS No. 131 will have on the Company's reported
segments.
<PAGE>
Equitable Resources, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (Unaudited)
I. Derivative Instruments and Hedging Activities
In June 1998 the FASB issued Statement of Financial Accounting Standards
No. 133, "Accounting for Derivative Instruments and Hedging Activities"
(SFAS No. 133), which is required to be adopted in years beginning after
June 15, 1999. The statement permits early adoption as of the beginning of
any fiscal quarter after its issuance. The Company has not yet decided when
to adopt the statement. The statement will require the Company to recognize
all derivatives on the balance sheet at fair value. Derivatives that are
not hedges must be adjusted to fair value through income. If the derivative
is a hedge, depending on the nature of the hedge, changes in the fair value
of derivatives will either be offset against the change in fair value of
the hedged assets, liabilities, or firm commitments through earnings or
recognized in other comprehensive income until the hedged item is
recognized in earnings. The ineffective portion of a derivative's change in
fair value will be immediately recognized in earnings. The Company has not
yet determined what effect SFAS No. 133 will have on the earnings and
financial position of the Company. However, SFAS No. 133 could increase
volatility in earnings and other comprehensive income.
J. At June 30, 1998, 8,963,000 shares of Common Stock were reserved as
follows: 460,000 shares for issuance under the Key Employee Restricted
Stock Option and Stock Appreciation Rights Incentive Compensation Plan,
1,726,000 shares for issuance under the Long-Term Incentive Plan, 76,000
shares for issuance under the Nonemployee Directors' Stock Incentive Plan,
26,000 shares for issuance under the Company's Dividend Reinvestment and
Stock Purchase Plan, and 6,675,000 shares for possible use in connection
with future acquisitions.
<PAGE>
<TABLE>
<CAPTION>
EQUITABLE RESOURCES, INC. AND SUBSIDIARIES
Information by Business Segment
Three Months Ended Six Months Ended
June 30, June 30,
------------------------------- ---------------------------------
1998 1997 1998 1997
------------------------------- ---------------------------------
(Thousands) (Thousands)
------------------------------- ---------------------------------
Restated Restated
Operating revenues
<S> <C> <C> <C> <C>
Supply and logistics $ 38,269 $ 50,387 $ 82,811 $ 98,471
Utilities 75,234 83,426 233,904 277,522
Services 98,007 74,096 215,808 182,698
Sales between segments (29,413) (30,013) (57,194) (76,639)
------------- ------------- -------------- -------------
Total $ 182,097 $ 177,896 $ 475,329 $ 482,052
============= ============= ============== =============
Operating income (loss) from continuing operations:
Supply and logistics $ 6,551 $ 9,640 $ 19,996 $ 20,670
Utilities 7,144 (8,826) 44,317 30,447
Services (330) (5,308) (2,106) (6,274)
------------- ------------- -------------- -------------
Total $ 13,365 $ (4,494) $ 62,207 $ 44,843
============= ============= ============== =============
Capital expenditures (continuing operations):
Supply and logistics $ 41,318 $ 18,366 $ 58,525 $ 28,336
Utilities 10,556 9,920 18,569 18,303
Services 144 609 580 938
------------- ------------- -------------- -------------
Total $ 52,018 $ 28,895 $ 77,674 $ 47,577
============= ============= ============== =============
</TABLE>
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations
OVERVIEW
Equitable's consolidated net income for the quarter ended June 30, 1998,
was $2.3 million, or $0.06 per share, compared with a net loss of $9.3 million,
or $0.26 per share, for the quarter ended June 30, 1997. The 1997 loss included
a one-time, after-tax charge of $8.5 million ($13 million pretax), or $0.24 per
share, for an asset writedown related to the Company's investment in a natural
gas storage project in Avoca, New York.
In April 1998 the Company adopted a formal plan to sell its natural gas
midstream operations. The operations include an integrated gas gathering,
processing and storage system in Louisiana and a natural gas and electricity
marketing business based in Houston. The condensed consolidated financial
statements have been restated to classify these as discontinued operations.
Management believes that the operations will be sold in the fourth quarter of
1998.
Equitable's income from continuing operations for the three months ended
June 30, 1998, was $2.3 million, or $0.06 per share, compared to a loss of $7.7
million, or $0.22 per share for the three months ended June 30, 1997. Excluding
the one-time charge for the storage project, 1997 results from continuing
operations would have been $0.8 million of net income or $0.02 per share for the
three months ended June 30. Overall, the current period results benefited from
higher net revenues from energy service operations and lower utility operating
expenses. These benefits were partially offset by lower revenues from crude oil
and natural gas liquids production and lower retail gas sales due to warmer
weather in the Company's distribution territory. The negative impact of the
weather was mitigated by a new retail rate design and base rate increase
implemented by the Company's distribution division in the fourth quarter of
1997.
Equitable's consolidated net income for the six months ended June 30,
1998, was $22.3 million, or $0.72 per share, compared to $18.5 million or $0.49
per share for the six months ended June 30, 1997. Excluding the 1997 storage
charge, income from continuing operations was essentially unchanged at $26.9
million, or $0.72 per share, for 1998 compared to $26.0 million, or $0.73 per
share for 1997. The current year benefits of higher net revenues from energy
services, new utility rate design, and lower production, exploration and
maintenance expenses in Supply and Logistics and Utilities were offset by the
effects of lower crude oil and natural gas liquids revenues, distribution
territory weather 21% warmer than 1997, increased depreciation, depletion and
amortization charges, and increased interest expense.
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
RESULTS OF OPERATIONS
SUPPLY AND LOGISTICS
Supply and Logistics' continuing operations are comprised of the
exploration and production of natural gas and crude oil and the processing and
sale of natural gas liquids through operations focused in the offshore Louisiana
Gulf Coast and Appalachian regions.
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
SUPPLY AND LOGISTICS 1998 1997 1998 1997
- ----------------------------------------------------------------------------------- ------------------------------------
(Thousands) (Thousands)
---------------------------------- ------------------------------------
Restated Restated
<S> <C> <C> <C> <C>
Continuing Operations
Operating Revenues
Produced Natural Gas $ 28,508 $ 28,658 $ 60,677 $ 57,443
Produced Natural Gas Liquids 4,110 6,216 9,939 11,763
Crude Oil 3,691 7,233 7,857 14,721
Other 1,960 8,280 4,338 14,544
-------------- --------------- --------------- ---------------
Total Revenues 38,269 50,387 82,811 98,471
Cost of Energy Purchased 3,814 3,659 7,608 7,715
-------------- --------------- --------------- ---------------
Net Operating Revenues 34,455 46,728 75,203 90,756
Operating Expenses:
Production 7,899 8,804 14,964 17,670
Exploration 1,772 4,096 3,081 5,789
Gas Processing 1,009 1,723 2,261 3,043
Other 5,815 12,226 12,236 23,226
Depreciation, Depletion and Amortization 11,409 10,239 22,665 20,358
-------------- --------------- --------------- ---------------
Total Operating Expenses 27,904 37,088 55,207 70,086
-------------- --------------- --------------- ---------------
Operating Income from Continuing Operations $ 6,551 $ 9,640 $ 19,996 $ 20,670
============== =============== =============== ===============
Sales Quantities:
Produced Natural Gas (MMcf) 13,305 13,584 26,299 26,312
Crude Oil (MBls) 271 421 535 832
Natural Gas Liquids (thousands of gallons) 16,021 16,979 34,232 29,131
Discontinued Operations
Operating Revenues 380,787 243,669 770,134 517,532
Operating Income (loss) - (346) (5,444) 4,797
</TABLE>
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
Three Months Ended June 30, 1998
vs. Three Months Ended June 30, 1997
Net operating revenues for the three months ended June 30, 1998,
decreased $12.3 million, due to the sale of the Company's Union Drilling
division in the fourth quarter of 1997 ($5.1 million), declines in crude oil
prices ($1.7 million) and volumes ($1.8 million) and natural gas liquids price
decline ($1.8 million).
Natural gas production declined slightly in 1998 compared to 1997, as a
1.9 bcf increase in offshore Gulf production (97%) was more than offset by
declines of 0.3 bcf in the Company's Appalachian region (3%) and 1.9 bcf due to
the third quarter 1997 sale of the Company's western properties.
The decline in crude oil production reflects the 1997 sale of the
Company's western properties, which held the majority of the Company's oil
reserves. The declines in crude oil (21%) and natural gas liquids (30%) prices
are a reflection of the overall commodity market, where oil price indexes show a
27% decline for the three-months ended June 30, 1998, compared to the same
period in 1997.
Total operating expenses for the second quarter of 1998 reflect savings
of $12.6 million due to the sales of the Union Drilling division and the western
properties. In addition, exploration expenses are down in the Gulf by $1.7
million because the 1998 drilling program has reallocated much of its
exploration budget to fund ongoing development and exploitation programs due to
the decline in oil prices. These savings are partially offset by higher
production costs ($1.7 million) and depreciation, depletion and amortization
(DD&A) expenses ($4.0 million) in the Gulf due to increases offshore production
activity and the acquisition of additional producing properties in the second
half of 1997.
Six Months Ended June 30, 1998
vs. Six Months Ended June 30, 1997
Net operating revenues for the six months ended June 30, 1998, decreased
$15.6 million due primarily to the sale of the Union Drilling division ($8.4
million) and declines in crude oil volumes ($3.9 million) and prices ($3.0
million) and natural gas liquids prices ($3.3 million). These decreases are
partially offset by an increase in the Company's average effective gas price
($3.9 million) as a result of a favorable hedged position.
Gas volumes for the six-month period of 1998 are comparable to 1997 as
production increases in the Gulf were offset by the loss of gas volumes
associated with the western property sale. The decline in oil volumes for the
year-to-date period is a result of the western sale.
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
SUPPLY AND LOGISTICS (Continued)
Total operating expenses for the first six months of 1998 benefited from
the sales of the Union Drilling division ($8.7 million) and western properties
($14.2 million) and lower exploration expenses ($1.3 million) in the Gulf.
Offsetting these decreases is an increase in the Gulf's production costs ($2.6
million) and DD&A expense ($8.3 million) due to the reasons noted above in the
discussion of the second quarter results.
UTILITIES
Utilities operations are comprised of the sale and transportation of
natural gas to retail customers at state-regulated rates, interstate
transportation and storage of natural gas subject to federal regulation and the
marketing of natural gas.
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
UTILITIES 1998 1997 1998 1997
- ------------------------------------------------------------------------------------- -------------------------------------
(Thousands) (Thousands)
<S> <C> <C> <C> <C>
Operating Revenues
Residential Gas Sales $ 35,974 $ 48,920 $ 140,775 $ 180,529
Commercial Gas Sales 3,423 4,844 14,073 21,620
Industrial and Utility Gas Sales 10,745 10,107 22,357 27,040
Marketed Gas Sales 5,271 4,665 9,827 10,883
Transportation Service 15,173 10,806 37,790 29,291
Storage Service 2,530 1,878 4,975 3,786
Other 2,118 2,206 4,107 4,373
--------------- -------------- ---------------- ---------------
Total Revenues 75,234 83,426 233,904 277,522
Cost of Energy Purchased 29,555 36,218 104,783 142,004
--------------- -------------- ---------------- ---------------
Net Operating Revenues 45,679 47,208 129,121 135,518
Operating Expenses:
Operations and Maintenance 31,450 36,228 70,705 78,618
Depreciation, Depletion and Amortization 7,085 6,806 14,099 13,453
Impairment of Assets 13,000 13,000
--------------- -------------- ---------------- ---------------
Total Operating Expenses 38,535 56,034 84,804 105,071
--------------- -------------- ---------------- ---------------
Operating Income $ 7,144 $ (8,826) $ 44,317 $ 30,447
=============== ============== ================ ===============
Sales Quantities (MMcf):
Residential Gas Sales 3,050 4,411 13,720 17,307
Commercial Gas Sales 342 444 1,454 2,117
Industrial and Utility Gas Sales 4,048 4,350 8,666 9,781
Marketed Gas Sales 2,506 1,417 4,710 3,382
Transportation Deliveries 22,199 21,126 40,859 41,615
Heating Degree Days 572 919 2,882 3,642
</TABLE>
<PAGE>
Management's Discussion and Analysis of Financia
Condition and Results of Operations (Continued)
Three Months Ended June 30, 1998
vs. Three Months Ended June 30, 1997
Net operating revenues for the quarter ended June 30, 1998, decreased
3.2% to $45.7 million, primarily as a result of weather 38% warmer than last
year in the Company's western Pennsylvania area distribution operations. The
effect of the weather on net operating revenues ($4.5 million) was substantially
mitigated by the effect of the base rate increases for Pennsylvania residential
and commercial customers and new rate design put in place by the Company in
October 1997 ($2.8 million benefit).
Approximately $0.8 million of the increase in transportation revenues
compared to 1997 also results from a base rate increase in 1997, with the
balance attributable to an increase in transportation for third parties rather
than regulated affiliates. This increase had minimal impact on the Company's
overall margins due to the regulatory treatment of purchased gas costs. Storage
revenues also increased due to new rates in effect in 1998.
Excluding the effect of the one-time storage project charge on 1997
results, operating expenses in the current period reflect the benefit of the
mild weather, as lower sales revenues are offset by savings in gross receipts
tax ($0.8 million), uncollectible accounts and customer assistance programs
($1.0 million, combined). The 1998 results also reflect lower utility and
corporate administrative expenses ($1.9 million), as the benefits are realized
from a third quarter 1997 evaluation and reduction of corporate office and
noncore business functions.
Six Months Ended June 30, 1998
vs. Six Months Ended June 30, 1997
Net operating revenues for the six-month period ended June 30, 1998,
decreased $6.4 million (4.7%) due to the warmer weather ($13.5 million),
substantially offset by the new rates in effect ($9.6 million) for gas sales and
transportation at the distribution company and for transportation and storage
services at Equitrans' pipeline. Marketed gas revenues declined 10% in the
current period, as the effects of natural gas commodity price decreases of 35%
offset volume increases of 40% compared to 1997. Taken together, these factors
resulted in a $0.4 million decline in net operating revenues in 1998. Net
operating revenues in 1998 declined by $1.3 million at Equitrans, due to the
elimination of certain processing surcharges previously passed through to
customers. This decrease is also reflected in operating expenses with no net
impact on the Company.
Excluding the storage project charge in 1997, operating expenses
decreased due to weather related factors ($4.5 million), the 1997 evaluation and
reduction of corporate office and noncore business functions ($2.3 million), and
the elimination of the processing surcharge ($1.3 million) described above.
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
SERVICES
Services' operations are comprised of two business lines: (1) marketing
of natural gas and (2) comprehensive energy services provided to industrial,
commercial, institutional and governmental customers. Energy services includes
the development, implementation, financing and management of energy and water
efficiency programs through the use of performance-based contracting activities,
the development and construction of cogeneration and independent power
production facilities and central plant facilities management. Beginning in
1995, this business segment was built through internal development and a series
of acquisitions of private energy performance and facilities management
contractors.
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
SERVICES 1998 1997 1998 1997
- -------------------------------------------------------------------------------------- -------------------------------------
(Thousands) (Thousands)
<S> <C> <C> <C> <C>
Operating Revenues
Marketed Natural Gas $ 75,476 $ 71,023 $ 174,345 $ 176,742
Energy Service Contracting 22,531 3,073 41,463 5,956
------------- -------------- -------------- -------------
Total Revenues 98,007 74,096 215,808 182,698
Cost of Energy Purchased 75,076 68,914 172,237 171,497
Energy Service Contract Costs 14,753 2,625 26,896 3,938
------------- -------------- -------------- -------------
Net Operating Revenues 8,178 2,557 16,675 7,263
Operating Expenses:
Other 7,238 7,606 16,130 13,068
Depreciation, Depletion and Amortization 1,270 259 2,651 469
------------- -------------- -------------- -------------
Total Operating Expenses 8,508 7,865 18,781 13,537
------------- -------------- -------------- -------------
Operating Income (Loss) $ (330) $ (5,308) $ (2,106) $ (6,274)
============= ============== ============== =============
Sales Quantities:
Marketed Natural Gas (MMcf) 32,626 27,163 68,556 57,725
</TABLE>
Three Months Ended June 30, 1998
vs. Three Months Ended June 30, 1997
Net operating revenues increased to $8.2 million for the quarter ended
June 30, 1998, compared to $2.6 million for the same period in 1997. This
segment's energy management and performance contracting operations experienced
substantial growth in revenues, due to the acquisition of NORESCO and internally
generated growth, as operations have moved forward from contract awards to
construction projects over the past 12 months.
This segment's energy marketing business experienced a $1.7 million
reduction in net operating revenues in the second quarter of 1998, as energy
prices remained low and competition increased for the more profitable commercial
customers.
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
SERVICES (Continued)
Operating expenses for this group increased $.4 million due to the
acquisition of NORESCO ($2.0 million), and the start-up of the energy marketing
operations of Equitable Energy, a new nonregulated retail marketing group in the
Company's southwestern Pennsylvania distribution area ($0.5 million). These
increases were substantially offset by a decrease in operating expenses relating
to the energy marketing business. Depreciation, depletion, and amortization also
increased due to $0.8 million amortization of goodwill associated with NORESCO.
Six Months Ended June 30, 1998
vs. Six Months Ended June 30, 1997
Net operating revenues increased to $16.7 million for the six months
ended June 30, 1998, compared to $7.3 million for the same period in 1997. This
segment's energy management and performance contracting operations experienced
substantial growth in revenues, due to the acquisition of NORESCO and internally
generated growth, as operations have moved forward from contract awards to
construction projects over the past 12 months.
This segment's energy marketing business experienced $3.1 million
reduction in net operating revenues in the six months ended 1998, as energy
prices remained low and competition increased for the more profitable commercial
customers.
Operating expenses for this group increased $3.0 million, primarily in
the energy management and performance contracting businesses, due to the
acquisition of NORESCO ($5.9 million), and the start-up of the energy marketing
operations of Equitable Energy, a new nonregulated retail marketing group in the
Company's southwestern Pennsylvania distribution area ($0.5 million) offset
somewhat by a decrease in operating expenses relating to the energy marketing
business. Depreciation, depletion, and amortization also increased due to $1.5
million amortization of goodwill associated with NORESCO.
CAPITAL RESOURCES AND LIQUIDITY
Cash Flows
Cash required for operations is impacted primarily by the seasonal
nature of ERI's natural gas distribution operations and the volatility of oil
and gas commodity prices. Short-term loans used to support working capital
requirements during the summer months are repaid as gas is sold during the
heating season.
Cash flows from operating activities totaled $67.3 million in the three
months ended June 30, 1998, compared to $13.4 million in the 1997 period. Cash
flows from operations increased in 1998 primarily as a result of improved
collections of accounts receivable.
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
CAPITAL RESOURCES AND LIQUIDITY (Continued)
The Company's performance contracting business requires substantial
initial working capital investments which are recovered in revenues as the
related energy savings are realized or when the contract is assigned. The net
investment in these projects during the six months ended June 30, 1998, was
approximately $25.1 million.
ERI's financial objectives require ongoing capital expenditures for
growth projects in continuing operations of the Supply & Logistics segment, as
well as replacements, improvements and additions to plant assets in the
Utilities segment. Such capital expenditures during the 1998 quarter were
approximately $52 million, including $37 million for exploration and production
projects in the Gulf of Mexico. In addition, ongoing capital projects in the
Company's discontinued operations accounted for an additional $10 million use of
cash in the three months ended June 30, 1998. A total of $229 million has been
authorized for the 1998 capital expenditure program. The Company expects to
finance its authorized 1998 capital expenditure program with cash generated from
operations and with short-term loans.
In the second quarter of 1998, financing activities used $1.5 million of
cash, as a result of the retirement of certain outstanding long-and short-term
debt through the issuance of preferred trust capital securities described below.
Capital Resources
ERI has adequate borrowing capacity to meet its financing requirements.
Bank loans and commercial paper, supported by available credit, are used to meet
short-term financing requirements. Interest rates on these short-term loans
averaged 5.7% during the second quarter of 1998. ERI maintains a revolving
credit agreement with a group of banks providing $500 million of available
credit. Adequate credit is expected to continue to be available in the future.
In April 1998 $125 million of 7.35% Trust Preferred Capital Securities
were issued. The capital securities were issued through a subsidiary trust,
Equitable Resources Capital Trust I, established for the purpose of issuing the
capital securities and investing the proceeds in 7.35% Junior Subordinated
Debentures issued by the Company. The capital securities have a mandatory
redemption date of April 15, 2038; however, at the Company's option, the
securities may be redeemed on or after April 23, 2003. Proceeds were used to
reduce short-term debt outstanding.
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations (Continued)
YEAR 2000 COSTS
ERI recognizes the need to ensure the continued safe and reliable
operation of its regulated utility systems and its nonregulated businesses up
to, across and beyond the year 2000. To achieve this, ERI has established a
program office to coordinate ongoing efforts to identify systems (and
operational processes) that are not Year 2000 compliant and to take corrective
actions as appropriate. The Company also has initiated discussions with its
significant suppliers, large customers and financial institutions to ensure that
those parties have appropriate plans to remediate Year 2000 issues when their
systems interface with the Company's systems or otherwise impact its operations.
The Company is assessing the extent to which its operations are vulnerable
should those organizations fail to remediate properly their computer systems.
Within ERI, assessment of systems has been substantially completed, systems have
been prioritized for remediation or replacement activities and corrective action
has been completed and tested on certain systems. In addition, ERI is presently
upgrading many of its financial and operating systems as part of an
enterprise-wide initiative to integrate systems and enhance operational
efficiencies. These systems are Year 2000 compliant. Management believes it has
adequate resources, both internal and external, to complete all necessary
activities. The estimated costs to convert remaining systems is not expected to
be material to results of operations in any future period.
INFORMATION REGARDING FORWARD LOOKING STATEMENTS
Disclosures in this report may include forward-looking statements
related to such matters as anticipated financial performance, business
prospects, capital projects, new products and operational matters. The Company
notes that a variety of factors could cause the Company's actual results to
differ materially from the anticipated results or other expectations expressed
in the Company's forward-looking statements. The risks and uncertainties that
may affect the operations, performance, development and results of the Company
business include, but are not limited to, the following: weather conditions, the
pace of deregulation of retail natural gas and electricity markets, the timing
and extent of changes in commodity prices for gas and oil, changes in interest
rates, the timing and extent of the Company's success in acquiring gas and oil
properties and in discovering, developing and producing reserves, delays in
obtaining necessary governmental approvals and the impact of competitive factors
on profit margins in various markets in which the Company competes.
<PAGE>
PART II. OTHER INFORMATION
Item 5. Other Information
The Securities and Exchange Commission has amended Rule 14a-4(C) under
the Securities Exchange Act of 1934 (the "1934 Act") which governs the
Company's use of discretionary proxy voting authority with respect to
shareholder proposals that are not being included in the Company's
proxy solicitation materials pursuant to Rule 14a-8 of the 1934 Act.
Therefore, in the event a shareholder does not notify the company by
March 1, 1999, of an intent to present such a proposal at the
Company's 1999 annual meeting, the Company's management proxies will
have the right to exercise their discretionary authority in connection
with the matter submitted by the shareholder, without discussion of
the matter in the proxy statement.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
4.1 Junior Subordinated Indenture Between Equitable
Resources, Inc. and Bankers Trust Company.
4.2 Amended and Restated Trust Agreement Between Equitable
Resources, Inc. and Bankers Trust Company.
4.3 Equitable Resources, Inc. 7.35% Junior Subordinated
Deferrable Interest Debentures Certificate.
10.1 Employment Agreement Addendum No. 2 to Employment
Agreement dated August 1, 1997, with Donald I. Moritz.
10.2 Employment Agreement dated as of May 4, 1998, with
Murry S. Gerber.
10.3 Change in Control Agreement dated May 4, 1998, with
Murry S. Gerber.
10.4 Supplemental Executive Retirement Agreement dated as of
May 4, 1998, with Murry S. Gerber.
10.5 Post-Termination Confidentiality and Non-Competition
Agreement dated May 4, 1998, with Murry S. Gerber.
(b) Reports on Form 8-K during the quarter ended June 30, 1998:
Form 8-K Current Report dated May 4, 1998, announcing the
appointment of Murry S. Gerber as the Company's president
and chief executive officer effective June 1, 1998.
<PAGE>
PART II. OTHER INFORMATION (Continued)
Item 6. Exhibits and Reports on Form 8-K (Continued)
Form 8-K Current Report dated June 2, 1998, announcing a jury
verdict in the case of U.S. Gas Transportation, Inc.
Form 8-K Current Report dated June 25, 1998, announcing
the addition of David L. Porges as the Company's senior
vice president and chief financial officer effective July
1, 1998.
<PAGE>
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
EQUITABLE RESOURCES, INC.
(Registrant)
/s/ David L. Porges
________________________________
David L. Porges
Senior Vice President
and Chief Financial Officer
Date: August 14, 1998
Exhibit 4.1
JUNIOR SUBORDINATED INDENTURE
Between
EQUITABLE RESOURCES, INC.
and
BANKERS TRUST COMPANY,
a New York banking corporation
(as Trustee)
April 23, 1998
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.1. Definitions............................................. 1
SECTION 1.2. Compliance Certificate and Opinions..................... 8
SECTION 1.3. Forms of Documents Delivered to Trustee................. 9
SECTION 1.4. Acts of Holders......................................... 9
SECTION 1.5. Notices, Etc. to Trustee and Company....................11
SECTION 1.6. Notice to Holders; Waiver...............................11
SECTION 1.7. Conflict with Trust Indenture Act.......................11
SECTION 1.8. Effect of Headings and Table of Contents................11
SECTION 1.9. Successors and Assigns..................................12
SECTION 1.10. Separability Clause.....................................12
SECTION 1.11. Benefits of Indenture...................................12
SECTION 1.12. Governing Law...........................................12
SECTION 1.13. Non-Business Days.......................................12
SECTION 1.14. Counterparts............................................12
ARTICLE II
SECURITY FORMS
SECTION 2.1. Forms Generally.........................................12
SECTION 2.2. Form of Face of Security................................13
SECTION 2.3. Form of Reverse of Security.............................16
SECTION 2.4. Additional Provisions Required in Global Security.......18
SECTION 2.5. Form of Trustee's Certificate of Authentication.........19
ARTICLE III
THE SECURITIES
SECTION 3.1. Title and Terms.........................................19
SECTION 3.2. Denominations...........................................21
SECTION 3.3. Execution, Authentication, Delivery and Dating..........22
SECTION 3.4. Temporary Securities....................................23
SECTION 3.5. Global Securities.......................................23
SECTION 3.6. Registration, Transfer and Exchange Generally.......... 24
SECTION 3.7. Mutilated, Lost and Stolen Securities...................25
SECTION 3.8. Payment of Interest and Additional Interest;
Interest Rights Preserved...............................25
SECTION 3.9. Persons Deemed Owners...................................26
SECTION 3.10. Cancellation............................................27
SECTION 3.11. Computation of Interest.................................27
SECTION 3.12. Deferrals of Interest Payment Dates.....................27
SECTION 3.13. Right of Set-Off........................................28
SECTION 3.14. Agreed Tax Treatment....................................28
SECTION 3.15. Advancing of Stated Maturity............................28
SECTION 3.16. CUSIP Numbers...........................................29
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1. Satisfaction and Discharge of Indenture.................29
SECTION 4.2. Application of Trust Money..............................30
ARTICLE V
REMEDIES
SECTION 5.1. Events of Default.......................................30
SECTION 5.2. Acceleration of Maturity; Rescission and Annulment......31
SECTION 5.3. Collection of Indebtedness and Suits for Enforcement by
Trustee.................................................32
SECTION 5.4. Trustee May File Proofs of Claim........................33
SECTION 5.5. Trustee May Enforce Claim Without Possession of
Securities..............................................33
SECTION 5.6. Application of Money Collected..........................33
SECTION 5.7. Limitation on Suits.....................................34
SECTION 5.8. Unconditional Right of Holders to Receive Principal,
Premium and Interest; Direct Action by
Holders of Capital Securities...........................34
SECTION 5.9. Restoration of Rights and Remedies......................35
SECTION 5.10. Rights and Remedies Cumulative..........................35
SECTION 5.11. Delay or Omission Not Waiver............................35
SECTION 5.12. Control by Holders......................................35
SECTION 5.13. Waiver of Past Defaults.................................35
SECTION 5.14. Undertaking for Costs...................................36
SECTION 5.15. Waiver of Usury, Stay or Extension Laws.................36
ARTICLE VI
THE TRUSTEE
SECTION 6.1. Certain Duties and Responsibilities.....................36
SECTION 6.2. Notice of Defaults......................................37
SECTION 6.3. Certain Rights of Trustee...............................38
SECTION 6.4. Not Responsible for Recitals or Issuance of Securities..39
SECTION 6.5. May Hold Securities.....................................39
SECTION 6.6. Money Held in Trust.....................................39
SECTION 6.7. Compensation and Reimbursement..........................39
SECTION 6.8. Disqualification; Conflicting Interests.................40
SECTION 6.9. Corporate Trustee Required; Eligibility.................40
SECTION 6.10. Resignation and Removal; Appointment of Successor.......41
SECTION 6.11. Acceptance of Appointment by Successor..................42
SECTION 6.12. Merger, Conversion, Consolidation or Succession
to Business.............................................43
SECTION 6.13. Preferential Collection of Claims Against Company.......43
SECTION 6.14. Appointment of Authenticating Agent.....................43
ARTICLE VII
HOLDER'S LISTS AND REPORTS BY TRUSTEE,
PAYING AGENT AND COMPANY
SECTION 7.1. Company to Furnish Trustee Names and Addresses
of Holders..............................................44
SECTION 7.2. Preservation of Information, Communications to Holders..45
SECTION 7.3. Reports by Trustee and Paying Agent.....................45
SECTION 7.4. Reports by Company......................................45
ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 8.1. Company May Consolidate, Etc., Only on Certain Terms....46
SECTION 8.2. Successor Company Substituted...........................46
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1. Supplemental Indentures Without Consent of Holders......47
SECTION 9.2. Supplemental Indentures with Consent of Holders.........48
SECTION 9.3. Execution of Supplemental Indentures....................49
SECTION 9.4. Effect of Supplemental Indentures.......................49
SECTION 9.5. Conformity with Trust Indenture Act.....................49
SECTION 9.6. Reference in Securities to Supplemental Indentures......49
ARTICLE X
COVENANTS
SECTION 10.1. Payment of Principal, Premium and Interest..............50
SECTION 10.2. Maintenance of Office or Agency.........................50
SECTION 10.3. Money for Security Payments to be Held in Trust.........50
SECTION 10.4. Statement as to Compliance..............................51
SECTION 10.5. Waiver of Certain Covenants.............................52
SECTION 10.6. Additional Sums.........................................52
SECTION 10.7. Additional Covenants....................................52
SECTION 10.8. Original Issue Discount.................................53
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 11.1. Applicability of This Article...........................53
SECTION 11.2. Election to Redeem; Notice to Trustee...................53
SECTION 11.3. Selection of Securities to be Redeemed..................54
SECTION 11.4. Notice of Redemption....................................54
SECTION 11.5. Deposit of Redemption Price.............................55
SECTION 11.6. Payment of Securities Called for Redemption.............55
SECTION 11.7. Right of Redemption of Securities Initially Issued
to an Issuer Trust......................................55
ARTICLE XII
SINKING FUNDS
ARTICLE XIII
SUBORDINATION OF SECURITIES
SECTION 13.1. Securities Subordinate to Senior Indebtedness...........56
SECTION 13.2. No Payment When Senior Indebtedness in Default;
Payment Over of Proceeds Upon Dissolution,
Etc.....................................................56
SECTION 13.3. Payment Permitted If No Default.........................57
SECTION 13.4. Subrogation to Rights of Holders of Senior Indebtedness.58
SECTION 13.5. Provisions Solely to Define Relative Rights.............58
SECTION 13.6. Trustee to Effectuate Subordination.....................58
SECTION 13.7. No Waiver of Subordination Provisions...................58
SECTION 13.8. Notice to Trustee.......................................59
SECTION 13.9. Reliance on Judicial Order or Certificate of
Liquidating Agent.......................................59
SECTION 13.10. Trustee Not Fiduciary for Holders of Senior
Indebtedness............................................60
SECTION 13.11. Rights of Trustee as Holder of Senior
Indebtedness; Preservation of Trustee's Rights..........60
SECTION 13.12. Article Applicable to Paying Agents.....................60
<PAGE>
Certain Sections of this Junior Subordinated Indenture relating
to Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Junior Subordinated
Act Section Indenture Section
- --------------- -------------------
(ss.) 310(a)(1).............................................................6.9
(a)(2).............................................................6.9
(a)(3)................................................. Not Applicable
(a)(4)................................................. Not Applicable
(a)(5).............................................................6.9
(b)..........................................................6.8, 6.10
(ss.) 311(a)...............................................................6.13
(b)(2)..........................................................7.3(a)
(ss.) 312(a)........................................................7.1, 7.2(a)
(b).............................................................7.2(b)
(c).............................................................7.2(c)
(ss.) 313(a).............................................................7.3(a)
(a)(4)..........................................................7.3(a)
(b).............................................................7.3(b)
(c).............................................................7.3(a)
(d).............................................................7.3(c)
(ss.) 314(a)................................................................7.4
(b)................................................................7.4
(c)(1)............................................................ 1.2
(c)(2).............................................................1.2
(c)(3)..................................................Not Applicable
(e)................................................................1.2
(ss.) 315(a).............................................................6.1(a)
(b)...........................................................6.2, 7.3
(c).............................................................6.1(b)
(d).............................................................6.1(c)
(e).............................................................. 5.14
(ss.) 316(a)...............................................................5.12
(a)(1)(A).........................................................5.12
(a)(1)(B).........................................................5.13
(a)(2)..................................................Not Applicable
(b)...............................................................5.18
(c).............................................................1.4(f)
(ss.) 317(a)(1).............................................................5.3
(a)(2).............................................................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.
<PAGE>
JUNIOR SUBORDINATED INDENTURE
THIS JUNIOR SUBORDINATED INDENTURE, dated as of April 23, 1998, between
EQUITABLE RESOURCES, INC., a Pennsylvania corporation (the "Company"), having
its principal office at 420 Boulevard of the Allies, Pittsburgh, Pennsylvania
15219, and BANKERS TRUST COMPANY, as Trustee, having its principal office at
Four Albany Street, 4th Floor, New York, New York 10006 (the "Trustee").
RECITALS OF THE COMPANY
WHEREAS, the Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
junior subordinated debt securities in series (hereinafter called the
"Securities") of substantially the tenor hereinafter provided, including
Securities issued to evidence loans made to the Company from the proceeds from
the issuance from time to time by one or more business trusts (each an "Issuer
Trust") of undivided preferred beneficial interests in the assets of such Issuer
Trusts (the "Capital Securities") and common undivided interests in the assets
of such Issuer Trusts (the "Common Securities" and, collectively with the
Capital Securities, the "Trust Securities"), and to provide the terms and
conditions upon which the Securities are to be authenticated, issued and
delivered;
WHEREAS, the Company has duly authorized the execution and delivery of
this Indenture to provide, among other things, for the authentication, delivery
and administration of the Securities; and
WHEREAS, 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 thereof, the Company and Trustee mutually covenant and
agree for the equal and proportionate benefit of all Holders of the Securities
or of any series thereof, and intending to be legally bound hereby, as follows:
ARTICLE I.
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 that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(3) The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation";
(4) All accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles as
in effect at the time of computation;
(5) Whenever the context may require, any gender shall be deemed to
include the other;
(6) 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 Indenture; and
(7) The words "hereby", "herein", "hereof" 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.
"Act" when used with respect to any Holder has the meaning specified in
Section 1.4.
"Additional Interest" means the interest, if any, that shall accrue on
any interest on the Securities of any series the payment of which has not been
made on the applicable Interest Payment Date and which shall accrue at the rate
per annum specified or determined as specified in such Security.
"Additional Sums" has the meaning specified in Section 10.6.
"Additional Taxes" means any additional taxes, duties and other
governmental charges to which an Issuer Trust has become subject from time to
time as a result of a Tax Event.
"Administrator" means, in respect of any Issuer Trust, each Person
appointed in accordance with the related Trust Agreement, solely in such
Person's capacity as Administrator of such Issuer Trust and not in such Person's
individual capacity, or any successor Administrator appointed as therein
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.
"Agent Member" means any member of, or participant in, the Depositary.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Global Security, in each case to
the extent applicable to such transaction and as in effect from time to time.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means the board of directors of the Company or the
Executive Committee of the board of directors of the Company (or any other
committee of the board of directors of the Company performing similar functions)
or, for purposes of this Indenture, a committee designated by the board of
directors of the Company (or such committee), comprised of two or more members
of the board of directors of the Company or officers of the Company, or both.
"Board Resolution" means a copy of one or more resolutions certified by
the Secretary or any Assistant Secretary of the Company to have been duly
adopted or consented to by the Board of Directors, or such committee of the
Board of Directors or officers of the Company to which authority to act on
behalf of the Board of Directors has been delegated, and to be in full force and
effect on the date of such certification, and delivered to the Trustee.
"Business Day" means any day other than (i) a Saturday or Sunday, (ii)
a day on which banking institutions in The City of New York or the City of
Pittsburgh, Pennsylvania are authorized or required by law or executive order to
remain closed, or (iii) a day on which the corporate trust office of the Trustee
is closed for business.
"Capital Securities" has the meaning specified in the first recital of
this Indenture.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, or, if at any time after
the execution of this instrument such Commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties on such date.
"Common Securities" has the meaning specified in the first recital of
this Indenture.
"Common Stock" means the common stock, no par value, of the Company.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor entity shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor entity.
"Company Request" and "Company Order" mean, respectively, the written
request or order signed in the name of the Company by its Chairman of the Board
of Directors, its Vice Chairman of the Board of Directors, its President or a
Vice President, and by its Cashier or an Assistant Cashier, its Controller or an
Assistant Controller, its Secretary or an Assistant Secretary, and delivered to
the Trustee.
"Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of this Indenture is located at Four Albany Street, New
York, New York 10006, Attention: Corporate Trust and Agency Group.
"Creditor" has the meaning specified in Section 6.7.
"Defaulted Interest" has the meaning specified in Section 3.8.
"Delaware Trustee" means, with respect to any Issuer Trust, the Person
identified as the "Delaware Trustee" in the related Trust Agreement, solely in
its capacity as Delaware Trustee of such Issuer Trust under such Trust Agreement
and not in its individual capacity, or its successor in interest in such
capacity, or any successor Delaware trustee appointed as therein provided.
"Depositary" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more Global
Securities, the Person designated as Depositary by the Company pursuant to
Section 3.1 until a successor Depositary shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Depositary" shall mean
or include each Person who is then a Depositary hereunder, and if at any time
there is more than one such Person, "Depositary" as used with respect to the
Securities of any such series shall mean the Depositary with respect to the
Global Securities of that series.
"Discount Security" means any security that 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.
"Dollar" or "$" means the coin or currency of the United States of
America that, as at the time of payment, is legal tender for the payment of
public and private debts.
The term "entity" includes a bank, corporation, association, company,
limited liability company, joint-stock company or business trust.
"Event of Default," unless otherwise specified in the supplemental
indenture creating a series of Securities, has the meaning specified in Section
5.1 herein.
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 1.4(f).
"Extension Period" has the meaning specified in Section 3.12.
"Global Security" means a Security in the form prescribed in Section
2.4 evidencing all or part of a series of Securities, issued to the Depositary
or its nominee for such series, and registered in the name of such Depositary or
its nominee.
"Guarantee" means, with respect to any Issuer Trust, the Guarantee
Agreement executed by the Company for the benefit of the Holders of the Capital
Securities issued by such Issuer Trust as modified, amended or supplemented from
time to time.
"Holder" means a Person in whose name a Security is registered in the
Securities 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 shall include the terms of each particular series of Securities established
as contemplated by Section 3.1.
"Interest Payment Date" means, as to each series of Securities, the
Stated Maturity of an installment of interest on such Securities.
"Investment Company Event" means the receipt by an Issuer Trust of an
Opinion of Counsel (as defined in the relevant Trust Agreement) to the Company
experienced in such matters, to the effect that, as a result of the occurrence
of a change in law or regulation or a written change (including any announced
prospective change) in interpretation or application of law or regulation by any
legislative body, court, governmental agency or regulatory authority, there is
more than an insubstantial risk that such Issuer Trust is or will be considered
an "investment company" that is required to be registered under the Investment
Company Act, which change or prospective change becomes effective or would
become effective, as the case may be, on or after the date of the issuance of
the Capital Securities of such Issuer Trust.
"Investment Company Act" means the Investment Company Act of 1940 and
any statute successor thereto, in each case as amended from time to time.
"Issuer Trust" has the meaning specified in the first recital of this
Indenture.
"Maturity" when used with respect to any Security means the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in
Section 5.1(3).
"Officers' Certificate" means a certificate signed by the Chairman of
the Board and Chief Executive Officer, President or a Vice President, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary, of
the Depositor, and delivered to the party provided herein. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Indenture shall comply with Section 314 of the Trust
Indenture Act and include:
(i) a statement by each officer signing the Officers' Certificate that
such officer has read the covenant or condition and the definitions relating
thereto;
(ii) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officers' Certificate;
(iii) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(iv) 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 or an employee of the Company or any Affiliate of the Company. Any
such opinion shall comply with Section 314 of the Trust Indenture Act and
include statements (i) through (iv) under the definition of "Officers'
Certificate" immediately above.
"Original Issue Date" means the date of issuance specified as such in
each Security.
"Outstanding" means, when used in reference to any Securities, 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 money in the necessary amount has
been theretofore deposited with the Trustee or any Paying Agent in trust for the
Holders of such Securities; and
(iii) Securities in substitution for or in lieu of which other
Securities have been authenticated and delivered or that have been paid
pursuant to Section 3.6, unless proof satisfactory to the Trustee is
presented that any such Securities are held by Holders in whose hands such
Securities are valid, binding and legal obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor (other than, for the avoidance of doubt, the
Issuer Trust to which Securities of the applicable series were initially issued)
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 that the Trustee actually knows to be so owned shall be so
disregarded. Securities so owned that 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 such other obligor (other than, for the avoidance of
doubt, such Issuer Trust). Upon the written request of the Trustee, the Company
shall furnish to the Trustee promptly an Officers' Certificate listing and
identifying all Securities, if any, known by the Company to be owned or held by
or for the account of the Company, or any other obligor on the Securities or any
Affiliate of the Company or such obligor (other than,for the avoidance of doubt,
such Issuer Trust), and, subject to the provisions of Section 6.1, the Trustee
shall be entitled to accept such Officers' Certificate as conclusive evidence of
the facts therein set forth and of the fact that all Securities not listed
therein are Outstanding for the purpose of any such determination.
"Paying Agent" means the Trustee or any Person authorized by the
Company to pay the principal of (or premium, if any) or interest on, or other
amounts in respect of any Securities on behalf of the Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment" means, with respect to the Securities of any series,
the place or places where the principal of (and premium, if any) and interest on
the Securities of such series are payable pursuant to Section 3.1.
"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. For the purposes of this definition, any security
authenticated and delivered under Section 3.7 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.
"Proceeding" has the meaning specified in Section 13.2.
"Property Trustee" means, with respect to any Issuer Trust, the Person
identified as the "Property Trustee" in the related Trust Agreement, solely in
its capacity as Property Trustee of such Issuer Trust under such Trust Agreement
and not in its individual capacity, or its successor in interest in such
capacity, or any successor property trustee appointed as therein provided.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture or the terms of such Security.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date with respect to the Securities of a series means, unless otherwise provided
pursuant to Section 3.1 with respect to Securities of such series, the date that
is the 1st day of January, April, July or October next preceding such Interest
Payment Date (whether or not a Business Day).
"Responsible Officer", when used with respect to the Property Trustee
means any officer assigned to the Corporate Trust Office, including any managing
director, vice president, assistant vice president, assistant treasurer,
assistant secretary or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
having direct responsibility for the administration of this Indenture, and
also,with respect to a particular matter, any other officer to whom such matter
is referred because of such officer's knowledge of and familiarity with the
particular subject.
"Rights Plan" means any plan of the Company providing for the issuance
by the Company to all holders of its Common Stock, no par value, of rights
entitling the holders thereof to subscribe for or purchase shares of any class
or series of capital stock of the Company which rights (i) are deemed to be
transferred with such shares of such Common Stock, (ii) are not exercisable,and
(iii) are also issued in respect of future issuances of such Common Stock,in
each case until the occurrence of a specified event or events.
"Securities" or "Security" means any debt securities or debt security,
as the case may be, authenticated and delivered under this Indenture.
"Securities Act" means the Securities Act of 1933, as modified, amended
or supplemented from time to time.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 3.6.
"Senior Indebtedness" means, whether recourse is to all or a portion of
the assets of the Company and whether or not contingent, (i) every obligation of
the Company for money borrowed; (ii) every obligation of the Company evidenced
by bonds, debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets or businesses;
(iii) every reimbursement obligation of the Company with respect to letters of
credit, bankers' acceptances or similar facilities issued for the account of the
Company; (iv) every obligation of the Company issued or assumed as the deferred
purchase price of property or services (but excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business); (v) every
capital lease obligation of the Company; (vi) every obligation of the Company
for claims (as defined in Section 101(4) of the United States Bankruptcy Code of
1978, as amended) in respect of derivative products such as interest and foreign
exchange rate contracts, commodity contracts and similar arrangements; and (vii)
every obligation of the type referred to in clauses (i) through (vi) of another
person and all dividends of another person the payment of which, in either case,
the Company has guaranteed or is responsible or liable, directly or indirectly,
as obligor or otherwise; provided that "Senior Indebtedness" shall not include
(i) any obligations which, by their terms, are expressly stated to rank pari
passu in right of payment with, or to not be superior in right of payment to,
the Securities, (ii) any Senior Indebtedness of the Company which when incurred
and without respect to any election under Section 1111(b) of the United States
Bankruptcy Code of 1978, as amended, was without recourse to the Company, (iii)
any indebtedness of the Company to any of its subsidiaries, (iv) indebtedness to
any employee of the Company, or (v) any indebtedness in respect of debt
securities issued to any trust, or a trustee of such trust, partnership or other
entity affiliated with the Company that is a financing entity of the Company in
connection with the issuance of such financing entity of securities that are
similar to the Capital Securities.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.8.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
pursuant to the terms of such Security as the fixed date on which the principal
of such Security or such installment of principal or interest is due and
payable, as such date may, in the case of the stated maturity of the principal
on any security, be shortened as provided pursuant to the terms of such Security
and this Indenture.
"Subsidiary" means an entity more than 50% 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.
For purposes of this definition, "voting stock" means stock that ordinarily has
voting power for the election of directors, whether at all times or only so long
as no senior class of stock has such voting power by reason of any contingency.
"Successor Security" of any particular Security means every Security
issued after, and 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 3.7 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.
"Tax Event" means the receipt by an Issuer Trust of an Opinion of
Counsel (as defined in the relevant Trust Agreement) to the Company experienced
in such matters to the effect that, as a result of any amendment to, or change
(including any announced prospective change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision or taxing
authority thereof or therein, or as a result of any official or administrative
pronouncement, action or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or which pronouncement,
action or decision is announced on or after the date of issuance of the Capital
Securities of such Issuer Trust, there is more than an insubstantial risk that
(i) such Issuer Trust is, or will be within 90 days of the delivery of such
Opinion of Counsel, subject to United States Federal income tax with respect to
income received or accrued on the corresponding series of Securities issued by
the Company to such Issuer Trust, (ii) interest payable by the Company on such
corresponding series of Securities is not, or within 90 days of the delivery of
such Opinion of Counsel, will not be, deductible by the Company, in whole or in
part, for United States Federal income tax purposes, or (iii) such Issuer Trust
is, or will be within 90 days of the delivery of such Opinion of Counsel,
subject to more than a de minimis amount of other taxes, duties or other
governmental charges.
"Trust Agreement" means, with respect to any Issuer Trust, the trust
agreement or other governing instrument of such Issuer Trust.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture, solely in its capacity as such and not in its
individual capacity, 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 Securities of
that series.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
modified, amended or supplemented from time to time, except as provided in
Section 9.5.
"Trust Securities" has the meaning specified in the first recital of
this Indenture.
"Vice President," when used with respect to the Company, means any duly
appointed vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."
Section 1.2. Compliance Certificate 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
(including covenants compliance with which constitutes a condition 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 (including covenants compliance with
which constitutes a condition 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.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than the
certificates provided pursuant to Section 10.4) shall include:
(1) a statement by each individual signing such certificate or opinion
that such individual has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions of such individual contained
in such certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he or she has
made such examination or investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether, in the opinion of such individual, such
condition or covenant has been complied with.
Section 1.3. Forms 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 matters upon which his or her 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 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 this Indenture to be given to 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 is or 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 6.1) conclusive in favor of
the Trustee and the Company, if made in the manner provided in this Section.
(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 the certificate of any 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 or her the execution thereof.
Where such execution is by a Person acting in other than his or her individual
capacity,such certificate or affidavit shall also constitute sufficient proof of
his or her authority.
(c) The fact and date of the execution by any Person of any
such instrument or writing, or the authority of the Person executing the same,
may also be provided in any other manner that the Trustee deems sufficient and
in accordance with such reasonable rules as the Trustee may determine.
(d) The ownership of Securities shall be proved by the
Securities Register.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done or suffered to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made upon such Security.
(f) The Company may set any day as a record date for the
purpose of determining the Holders of Outstanding Securities of any series
entitled to give, make or take any request, demand, authorization, direction,
notice, consent, waiver or other action provided or permitted by this Indenture
to be given, made or taken by Holders of Securities of such series, provided
that the Company may not set a record date for, and the provisions of this
paragraph shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next succeeding paragraph.
If any record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other
Holders,shall be entitled to take the relevant action, whether or not such
Holders remain Holders after such record date, provided that no such action
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date (as defined below) by Holders of the requisite principal amount
of Outstanding Securities of such series on such record date. Nothing in this
paragraph shall be construed to prevent the Company from setting a new record
date for any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall automatically and
with no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Company, at its own expense, shall cause notice
of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Trustee in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 1.6.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to join
in the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 5.2, (iii) any request to institute
proceedings referred to in Section 5.7(2), or (iv) any direction referred to in
Section 5.12, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date, provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect) and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company's expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 1.6.
With respect to any record date set pursuant to this Section, the party
hereto that sets such record date may designate any day as the "Expiration Date"
and from time to time may change the Expiration Date to any earlier or later
day, provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 1.6 on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto that set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
(g) Without limiting the foregoing, a Holder entitled
hereunder to 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 may do so
pursuant to such appointment with regard to all or any part of such principal
amount.
Section 1.5. Notices, Etc. to Trustee and Company.
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, any holder of Capital Securities or 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, or
(2) the Company by the Trustee, any Holder or any holder of Capital
Securities shall be sufficient for every purpose (except as otherwise provided
in Section 5.1) hereunder if in writing and mailed, first class, postage
prepaid, to the Company addressed to it 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 the address of such Holder as it appears in the Securities
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. If, by reason of the suspension
of or irregularities in regular mail services or for any other reason, it shall
be impossible or impracticable to mail notice of any event to Holders when said
notice is required to be given pursuant to any provision of this Indenture or of
the relevant Securities, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient 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. 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.
Section 1.7. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act that is required under such Act to be a part of and
govern this Indenture, the provision of the Trust Indenture Act shall control.If
any provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
may be.
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.
If 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 and their successors and
assigns, the holders of Senior Indebtedness, the Holders of the Securities and,
to the extent expressly provided in Sections 5.2, 5.8, 5.9, 5.11, 5.13, 9.1 and
9.2, the holders of Capital Securities, 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.
Section 1.13. Non-Business Days.
If any Interest Payment Date, Redemption Date or Stated Maturity of any
Security shall not be a Business Day, then (notwithstanding any other provision
of this Indenture or the Securities) payment of interest or principal (and
premium, if any) or other amounts in respect of such Security need not be made
on such date, but may be made on the next succeeding Business Day (and no
interest shall accrue in respect of the amounts whose payment is so delayed for
the period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, until such next succeeding Business Day) except
that, if such Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day (in each case with the
same force and effect as if made on the Interest Payment Date or Redemption Date
or at the Stated Maturity).
Section 1.14. Counterparts.
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.
ARTICLE II.
SECURITY FORMS
Section 2.1. Forms Generally.
The Securities of each series and the Trustee's certificate of
authentication shall be in substantially the forms set forth in this Article, or
in such other form or forms as shall be established by 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 other marks of identification and such legends or endorsements placed thereon
as may be required to comply with applicable tax laws or 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. If the form of Securities of any series is 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 Company
Order contemplated by Section 3.3 with respect to the authentication and
delivery of such Securities.
The Trustee's certificates of authentication shall be substantially in
the form set forth in Section 2.5.
The definitive Securities shall be printed, lithographed or engraved or
produced by any combination of these methods, if required by any securities
exchange on which the Securities may be listed, on a steel engraved border or
steel engraved borders or may be produced in any other manner permitted by the
rules of any securities exchange on which the Securities may be listed, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Securities distributed to holders of Global Capital Securities (as
defined in the applicable Trust Agreement) upon the dissolution of an Issuer
Trust shall be distributed in the form of one or more Global Securities
registered in the name of a Depositary or its nominee, and deposited with the
Securities Registrar, as custodian for such Depositary, or with such Depositary,
for credit by the Depositary to the respective accounts of the beneficial owners
of the Securities represented thereby (or such other accounts as they may
direct). Securities distributed to holders of Capital Securities other than
Global Capital Securities upon the dissolution of an Issuer Trust shall not be
issued in the form of a Global Security or any other form intended to facilitate
book-entry trading in beneficial interests in such Securities.
Section 2.2. Form of Face of Security.
EQUITABLE RESOURCES, INC.
[Title of Security]
No. CUSIP: _______________
$ --------------------
EQUITABLE RESOURCES, INC., a Pennsylvania corporation (hereinafter
called the "Company", which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to __________________, or registered assignees, the principal sum
of_____________Dollars on __________, [if the Security is a Global Security,
then insert, if applicable--, or such other principal amount represented hereby
as may be set forth in the records of the Securities Registrar hereinafter
referred to in accordance with the Indenture,]; provided that the Company may
advance such date to a date not earlier than ____________ in accordance with the
Indenture. The Company further promises to pay interest on said principal from
and including ___________, or from the most recent Interest Payment Date to
which interest has been paid or duly provided for, [monthly] [quarterly]
[semi-annually] [if applicable,insert-- (subject to deferral as set forth
herein)] in arrears on [insert applicable Interest Payment Dates] of each year,
commencing ___________ at the rate of ______ % per annum, [if applicable
insert--together with Additional Sums, if any, as provided in Section 10.6 of
the Indenture,] until the principal hereof has been paid or duly provided for or
made available for payment [if applicable, insert--; provided that any overdue
principal, premium or Additional Sums and any overdue installment of interest
shall bear Additional Interest at the rate of ___% per annum (to the extent that
the payment of such interest shall be legally enforceable), compounded [monthly]
[quarterly] [semi-annually], from the dates such amounts are due until they are
paid or made available for payment, and such interest shall be payable on
demand]. The amount of interest payable for any period less than a full interest
period shall be computed on the basis of a 360-day year of twelve 30-day months
and the actual days elapsed in a partial month in such period. The amount of
interest payable for any full interest period shall be computed by dividing the
applicable rate per annum by [twelve/four/two]. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name this Security (or
one or more Predecessor Securities) is registered at the close of business on
the Regular Record Date for such interest installment [if applicable, insert--,
which shall be the [ _____ day of ________, _________, __________ or
_____________] (whether or not a Business Day) next preceding such Interest
Payment Date]. Any such interest not so punctually paid or duly provided for
shall forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture. The term "interest" as used herein includes quarterly
interest payments, interest on quarterly interest payments not paid on the
applicable Interest Payment Date and Additional Sums, as applicable. As used
herein, "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 or the City of
Pittsburgh, Pennsylvania are authorized or required by law or executive order to
remain closed, or (c) a day on which the corporate trust office of the Property
Trustee is closed for business.
[If applicable, insert--So long as no Event of Default has occurred
and is continuing, the Company shall have the right, at any time during the term
of this Security, from time to time to defer the payment of interest on this
Security for up to _____ consecutive [monthly] [quarterly][semi-annual] interest
payment periods with respect to each deferral period (each an "Extension
Period") [if applicable, insert--, during which Extension Periods the Company
shall have the right to make partial payments of interest on any Interest
Payment Date, and] at the end of which the Company shall pay all interest then
accrued and unpaid including any Additional Interest, as provided below;
provided, however, that no Extension Period shall extend beyond the Stated
Maturity of the principal of this Security [If Stated Maturity can be advanced,
insert--, as then in effect,] and no such Extension Period may end on a date
other than an Interest Payment Date. In the event that the Stated Maturity is
advanced to a date prior to the end of an Extension Period, such Extension
Period shall be deemed to end on such date or such earlier date as may be
determined by the Company. In the event that any Securities are called for
redemption on the date prior to the end of an Extension Period, with respect to
such Securities, such Extension Period shall be deemed to end on such date or
such earlier date as may be determined by the Company. During any such Extension
Period, the Company shall not (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire or make a liquidation payment with respect to,
any of the Company's capital stock, or (ii) make any payment of principal of or
interest or premium,if any, on or repay, repurchase or redeem any debt
securities of the Company that rank pari passu in all respects with or junior in
interest to this Security (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Company (1) in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or consultants,
(2) in connection with a dividend reinvestment or stockholder stock purchase
plan or (3) in connection with the issuance of capital stock of the Company (or
securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the applicable
Extension Period, (b) as a result of an exchange or conversion of any class or
series of the Company's capital stock (or any capital stock of a Subsidiary of
the Company) for any class or series of the Company's capital stock or of any
class or series of the Company's indebtedness for any class or series of the
Company's capital stock, (c) the purchase of fractional interests in shares of
the Company's capital stock pursuant to the conversion or exchange provisions of
such capital stock or the security being converted or exchanged, (d) any
declaration of a dividend in connection with any Rights Plan, or the issuance of
rights, stock or other property under any Rights Plan, or the redemption or
repurchase of rights pursuant thereto, (e) payments under the Guarantee, or (f)
any dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior to such stock). Prior to the termination of any
such Extension Period,the Company may further defer the payment of interest,
provided that no Extension Period shall exceed ____ consecutive [monthly]
[quarterly][semi-annual] interest payment periods, extend beyond the Stated
Maturity of the principal of this Security or end on a date other than an
Interest Payment Date. Upon the termination of any such Extension Period and
upon the payment of all accrued and unpaid interest and any Additional Interest
then due on any Interest Payment Date, the Company may elect to begin a new
Extension Period, subject to the above conditions. No interest shall be due and
payable during an Extension Period, except at the end thereof, but each
installment of interest that would otherwise have been due and payable during
such Extension Period shall bear Additional Interest (to the extent that the
payment of such interest shall be legally enforceable) at the rate of ___ % per
annum, compounded [monthly][quarterly] [semi-annually] and calculated as set
forth in the first paragraph of this Security, from the date on which such
amounts would otherwise have been due and payable until paid or made available
for payment. The Company shall give the Holder of this Security and the Trustee
notice of its election to begin any Extension Period at least one Business Day
prior to the earlier of (i) the date the Distributions on the Capital Securities
of such Issuer Trust would have been payable but for the election to begin such
Extension Period, and (ii) the date on which the Property Trustee of such Issuer
Trust is required to give notice to holders of such Capital Securities of the
record date or the date such Distributions are payable, but in any event not
less than one Business Day prior to such record date.]
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in the United States, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts [if applicable, insert--; provided, however that at the option of
the Company payment of interest may be made (i) by check mailed to the address
of the Person entitled thereto as such address shall appear in the Securities
Register,or (ii) if to a Holder of $1,000,000 or more in aggregate principal
amount of this Security, by wire transfer in immediately available funds upon
written request to the Trustee not later than 15 calendar days prior to the date
on which the interest is payable].
The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and subject in right of payments to the prior
payment in full of all Senior Indebtedness, and this Security is issued subject
to the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take
such actions as may be necessary or appropriate to effectuate the subordination
so provided, and (c) appoints the Trustee his or her attorney-in-fact for any
and all such purposes. Each Holder hereof, by his or her acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon
said provisions.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
EQUITABLE RESOURCES, INC.
By:_____________________________________________
Name:
Title:
Attest:
- ------------------------------------
Secretary or Assistant Secretary
Section 2.3. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or more
series under the Junior Subordinated Indenture, dated as of _____________ , 1998
(herein called the "Indenture"), between the Company and Bankers Trust Company,
as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective
rights,limitations of rights, duties and immunities thereunder of the Company,
the Trustee, the holders of Senior Indebtedness and the Holders of the
Securities, and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof [if applicable, insert--, limited in aggregate principal amount
to $ ___________ ]. The Company has appointed _______ _____________ at its
corporate trust office in The City of New York as the paying agent (the "Paying
Agent," which term includes any additional or successor Paying Agent appointed
by the Company) with respect to the Securities.
To the extent not inconsistent herewith, the terms of the Indenture are
hereby incorporated by reference herein. All terms used in this Security that
are defined in the Indenture [if applicable, insert-- or in [insert name of
trust agreement], dated as of___________ (as modified, amended or supplemented
from time to time the "Trust Agreement"), relating to [insert name of Issuer
Trust] [the ("Issuer Trust") among the Company, as Depositor, the Trustees named
therein and the Holders from time to time of the Trust Securities issued
pursuant thereto] shall have the meanings assigned to them in the Indenture [if
applicable, insert--or the Trust Agreement, as the case may be].
[If applicable, insert--this Security will not be subject to any
sinking fund and, except as provided in the Indenture, will not be redeemable or
subject to repayment at the option of the holder prior to its Stated Maturity.]
[If applicable, insert--The Company may redeem this Security prior to
the Stated Maturity at the option of the Company (i) on or after _________, in
whole at any time or in part from time to time, and (ii) prior to __________, in
whole (but not in part) at any time within 90 days following the occurrence and
during the continuation of a Tax Event or an Investment Company Event (the
90-Day Period"), in each case at a Redemption Price equal to the accrued and
unpaid interest on the Securities so redeemed to the date fixed for redemption,
plus 100% of the principal amount thereof; provided, however that if at the time
there is available to the Company or the Issuer Trust the opportunity to
eliminate, within the 90-Day Period, the Tax Event or Investment Company Event
by taking some ministerial action ("Ministerial Action"), such as filing a form
or making an election, or pursuing some other similar reasonable measure that
will have no adverse effect on the Company, the Issuer Trust or the holders of
the Trust Securities and will involve no material cost, the Company shall pursue
such measures in lieu of redemption; provided, further, that the Company shall
have no right to redeem the Securities while the Issuer Trust is pursuing any
Ministerial Action pursuant to the Trust Agreement.]
[If the Security is subject to redemption of any kind, insert--Notice
or redemption shall be mailed to the registered holders of the Securities
designated for redemption at their addresses as the same shall appear on the
Security register not less than 30 nor more than 60 days prior to the dated
fixed for redemption, subject to all conditions and provision of the Indenture.
In the event of redemption of this Security in part only, a new Security or
Securities of this series for the unredeemed portion hereof will be issued in
the name of the Holder hereof upon the cancellation hereof.]
[If applicable, insert--The Indenture contains provisions for
defeasance at any time [of the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance by the Company with certain
conditions set forth in the Indenture.]
The Indenture permits, with certain exceptions as therein provided, the
Company and the Trustee at any time to enter into a supplemental indenture or
indentures for the purpose of modifying in any manner the rights and obligations
of the Company and of the Holders of the Securities, with the consent of the
Holders of not less than a majority in principal amount of the Outstanding
Securities of each series to be affected by such supplemental indenture. The
Indenture also contains provisions permitting Holders of specified percentages
in principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange here for or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
[If the Security is not a Discount Security, insert--As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
to the Securities of this 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% in aggregate principal amount of the Outstanding Securities of this
series may declare the principal amount of all the Securities of this series and
interest accrued thereon to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders) [if applicable,
insert--, provided that, if upon an Event of Default, the Trustee or such
Holders fail to declare the principal of all the outstanding Securities of this
series to be immediately due and payable, the Holders of at least 25% in
aggregate Liquidation Amount of the Capital Securities then outstanding shall
have the right to make such declaration by a notice in writing to the Company
and the Trustee]; and upon any such declaration the principal amount of and the
accrued interest (including any Additional Interest) on all the Securities of
this series shall become immediately due and payable, provided that the payment
of principal and interest (including any Additional Interest) on such Securities
shall remain subordinated to the extent provided in Article XIII of the
Indenture.]
[If the Security is a Discount Security, insert--As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
to the Securities of this 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% in aggregate principal amount of the Outstanding Securities of this
series may declare an amount of principal of the Securities of this series to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders) [if applicable, insert--, provided that, if upon an
Event of Default, the Trustee or such Holders fail to declare such principal
amount of the Outstanding Securities of this series to be immediately due and
payable, the holders of at least 25% in aggregate Liquidation Amount of the
Capital Securities then outstanding shall have the right to make such
declaration by a notice in writing to the Company and the Trustee. The principal
amount payable upon such acceleration shall be equal to--insert formula for
determining the amount]. Upon any such declaration, such amount of the principal
of and the accrued interest (including any Additional Interest) on all the
Securities of this series shall become immediately due and payable, provided
that the payment of such principal and interest (including any Additional
Interest) on all the Securities of this series shall remain subordinated to the
extent provided in Article XIII of the Indenture. Upon payment (i) of the amount
of principal so declared due and payable and (ii) of interest on any overdue
principal, premium and interest (in each case to the extent that the payment of
such interest shall be legally enforceable), all of the Company's obligations in
respect of the payment of the principal of and premium and interest, if any, on
this Security shall terminate.]
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest (including Additional Interest) on this Security at the times, place
and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Securities
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company maintained under Section 10.2 of the Indenture
for such purpose, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Securities Registrar duly
executed by,the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Securities of this series, of like tenor,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $25 and any integral multiple of $25 in
excess thereof. As provided in the Indenture and subject to certain limitations
therein set forth, Securities of this series are exchangeable for a like
aggregate principal amount of Securities of this series and of like tenor of a
different authorized denomination, as requested by the Holder surrendering the
same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Company and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agrees that for United States Federal, state and
local tax purposes it is intended that this Security constitute indebtedness.
THIS SECURITY SHALL FOR ALL PURPOSES BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Section 2.4. Additional Provisions Required in Global Security.
Unless otherwise specified as contemplated by Section 3.1, any Global
Security issued hereunder shall, in addition to the provisions contained in
Sections 2.2 and 2.3, bear a legend in substantially the following form:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY ("DTC") (55 WATER STREET, NEW YORK, NEW YORK) TO
THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC AND ANY PAYMENT IS MADE
TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE REGISTERED FORM, THIS CERTIFICATE MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO DTC OR ANY OTHER
NOMINEE OF DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A
NOMINEE OF SUCH SUCCESSOR DEPOSITORY.
Section 2.5. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially
the following form:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Dated: _______________ BANKERS TRUST COMPANY,
as Trustee
By: _________________________
Authorized Officer
ARTICLE III.
THE SECURITIES
Section 3.1. Title and Terms.
The aggregate principal amount of Securities that may be authenticated
and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 3.3,
set forth or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities as a series:
(a) the title of the securities of such series, which shall
distinguish the Securities of the series from all other Securities;
(b) the limit, if any, upon the aggregate principal amount of
the Securities of such series that 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 Section 3.4, 3.6, 3.7, 9.6 or 11.6 and except for any
Securities that, pursuant to Section 3.3, are deemed never to have been
authenticated and delivered hereunder); provided, however, that the authorized
aggregate principal amount of such series may be increased above such amount by
a Board Resolution to such effect;
(c) the Person to whom any interest on a Security of the
series shall be payable, if other than 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;
(d) the Stated Maturity or Maturities on which the principal
of the Securities of such series is payable or the method of determination
thereof, and any dates on which or circumstances under which, the Company shall
have the right to shorten such Stated Maturity or Maturities;
(e) the rate or rates, if any, at which the Securities of such
series shall bear interest, if any, the rate or rates and extent to which
Additional Interest, if any, shall be payable with respect to any Securities of
such series, the date or dates from which any such interest or Additional
Interest shall accrue, the Interest Payment Dates on which such interest shall
be payable, the right, pursuant to Section 3.12 or as otherwise set forth
therein, of the Company to defer or extend an Interest Payment Date, and the
Regular Record Date for the interest payable on any Interest Payment Date or the
method by which any of the foregoing shall be determined;
(f) the place or places where the principal of (and premium,
if any) and interest or Additional Interest on the Securities of such series
shall be payable, the place or places where the Securities of such series may be
presented for registration of transfer or exchange, any restrictions that may be
applicable to any such transfer or exchange in addition to or in lieu of those
set forth herein and the place or places where notices and demands to or upon
the Company in respect of the Securities of such series may be made;
(g) the period or periods within or the date or dates on
which, if any, the price or prices at which and the terms and conditions upon
which the Securities of such series may be redeemed, in whole or in part, at the
option of the Company, and if other than by a Board of Resolution, the manner in
which any election by the Company to redeem such Securities shall be evidenced;
(h) the obligation or the right, if any, of the Company to
redeem, repay or purchase the Securities of such series pursuant to any sinking
fund, amortization or analogous provisions, or at the option of a Holder
thereof, and the period or periods within which, the price or prices at which,
the currency or currencies (including currency unit or units) in which and the
other terms and conditions upon which Securities of the series shall be
redeemed, repaid or purchased, in whole or in part, pursuant to such obligation;
(i) the denominations in which any Securities of such series
shall be issuable if other than denominations of $25 and any integral multiple
thereof;
(j) if other than Dollars, the currency or currencies
(including any currency unit or units) in which the principal of (and premium,
if any) and interest and Additional Interest, if any, on the Securities of the
series shall be payable, or in which the Securities of the series shall be
denominated and the manner of determining the equivalent thereof in Dollars for
purposes of the definition of Outstanding;
(k) the additions, modifications or deletions, if any, in the
Events of Default or covenants of the Company set forth herein with respect to
the Securities of such series;
(l) if, other than the principal amount thereof, the portion
of the principal amount of Securities of such series that shall be payable upon
declaration of acceleration of the Maturity thereof;
(m) if the principal amount payable at the Stated Maturity of
any Securities of the series will not be determinable as of any one or more
dates prior to the Stated Maturity, the amount which shall be deemed to be the
principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall be
due and payable upon any Maturity other than the Stated Maturity or which shall
be deemed to be Outstanding as of any date prior to the Stated Maturity (or, in
any such case, the manner in which such amount deemed to be the principal amount
shall be determined);
(n) the additions or changes, if any, to this Indenture with
respect to the Securities of such series as shall be necessary to permit or
facilitate the issuance of the Securities of such series in bearer form,
registrable or not registrable as to principal, and with or without interest
coupons;
(o) any index or indices used to determine the amount of
payments of principal of and premium, if any, on the Securities of such series
or the manner in which such amounts will be determined;
(p) if applicable, that any Securities of the series shall be
issuable in whole or in part in the form of one or more Global Securities and,
in such case, the respective Depositaries for such Global Securities, the form
of any legend or legends that shall be borne by any such Global Security in
addition to or in lieu of that set forth in Section 2.4 and any circumstances in
addition to or in lieu of those set forth in Section 3.6 in which any such
Global Security may be exchanged in whole or in part for Securities registered,
and any transfer of such Global Security in whole or in part may be registered,
in the name or names of Persons other than the Depositary for such Global
Security or a nominee thereof;
(q) the appointment of any Paying Agent or agents for the
Securities of such series;
(r) the terms of any right to convert or exchange Securities
of such series into any other securities or property of the Company, and the
additions or changes, if any, to this Indenture with respect to the Securities
of such series to permit or facilitate such conversion or exchange;
(s) if such Securities are to be issued to an Issuer Trust,
the form or forms of the Trust Agreement and Guarantee relating thereto;
(t) if other than as set forth herein, the relative degree, if
any, to which the Securities of the series shall be senior to or be subordinated
to other series of Securities in right of payment, whether such other series of
Securities are Outstanding or not;
(u) any addition to or change in the Events of Default which
applies to any Securities of the series and any change in the right of the
Trustee or the requisite Holders of such Securities to declare the principal
amount thereof due and payable pursuant to Section 5.2;
(v) any addition to or change in the covenants set forth in
Article X which applies to Securities of the series; and
(w) any other terms of the Securities of such series (which
terms shall not be inconsistent with the provisions of this Indenture, except as
permitted by Section 9.1(6)).
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided herein or in
or pursuant to such Board Resolution and set forth, or determined in the manner
provided, in such Officers' Certificate or in any indenture supplemental hereto.
If any of the terms 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.
The securities shall be subordinated in right of payment to Senior
Indebtedness as provided in Article XIII.
Section 3.2. Denominations.
The Securities of each series shall be in registered form without
coupons and shall be issuable in denominations of $25 and any integral multiple
thereof, unless otherwise specified as contemplated by Section 3.1(i).
Section 3.3. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal reproduced or impressed thereon
and 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 a Company Order for the authentication and
delivery of such Securities, and the Trustee in accordance with the Company
Order shall authenticate and deliver such Securities. If the form or terms of
the Securities of the series have been established by or pursuant to one or more
Board Resolutions 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 Section 6.1) shall be fully protected in conclusively relying upon,
an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or
pursuant to Board Resolution as permitted by Section 2.1, that
such form has been established in conformity with the
provisions of this Indenture;
(2) if the terms of such Securities have been established by
or pursuant to Board Resolution as permitted by Section 3.1,
that such terms have been established in conformity with the
provisions of this Indenture; and
(3) that such Securities, when authenticated and delivered by
the Trustee and issued by the Company in the manner and
subject to any conditions specified in such Opinion of
Counsel, will constitute valid and legally binding obligations
of the Company enforceable in accordance with their 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.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities 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 that
is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 3.1 and the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 3.1 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
Each Security shall be dated the date of its authentication.
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 the manual signature of one of its authorized
officers, and 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 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 3.10, for all purposes of this Indenture
such Security shall be deemed never to have been authenticated and delivered
hereunder and shall never 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 upon receipt of a Company Order the Trustee shall
authenticate and deliver, temporary Securities that are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any denomination,
substantially of the tenor of the definitive Securities of such series in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities may
determine, as evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company will
cause definitive Securities of such series to be prepared without unreasonable
delay. After the preparation of definitive Securities, the temporary Securities
shall be exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for that purpose
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor one or more definitive securities
of the same series, of any authorized denominations having the same Original
Issue Date and Stated Maturity and having the same terms as such temporary
Securities. 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.
Section 3.5. Global Securities.
(a) Each Global Security issued under this Indenture shall be
registered in the name of the Depositary designated by the Company for such
Global Security or a nominee thereof and delivered to such Depositary or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, no
Global Security may be exchanged in whole or in part for Securities registered,
and no transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depositary for such Global Security or a
nominee thereof unless (i) such Depositary advises the Trustee in writing that
such Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Security, and the
Company is unable to locate a qualified successor, (ii) the Company executes and
delivers to the Trustee a Company Order stating that the Company elects to
terminate the book-entry system through the Depositary, or (iii) there shall
have occurred and be continuing an Event of Default.
(c) If any Global Security is to be exchanged for other
Securities or cancelled in whole, it shall be surrendered by or on behalf of the
Depositary or its nominee to the Securities Registrar for exchange or
cancellation as provided in this Article III. If any Global Security is to be
exchanged for other Securities or cancelled in part, or if another Security is
to be exchanged in whole or in part for a beneficial interest in any Global
Security, then either (i) such Global Security shall be so surrendered for
exchange or cancellation as provided in this Article III or (ii) the principal
amount thereof shall be reduced, subject to Section 3.6, or increased by an
amount equal to the portion thereof to be so exchanged or cancelled, or equal to
the principal amount of such other Security to be so exchanged for a beneficial
interest therein, as the case may be, by means of an appropriate adjustment made
on the records of the Securities Registrar, whereupon the Trustee, in accordance
with the Applicable Procedures, shall instruct the Depositary or its authorized
representative to make a corresponding adjustment to its records. Upon any such
surrender or adjustment of a Global Security by the Depositary, accompanied by
registration instructions, the Trustee shall, subject to Section 3.6 and as
otherwise provided in this Article III, authenticate and deliver any Securities
issuable in exchange for such Global Security (or any portion thereof) in
accordance with the instructions of the Depositary. The Trustee shall not be
liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be fully protected in relying on, such instructions.
(d) Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global Security
or any portion thereof, whether pursuant to this Article III, Section 9.6 or
11.6 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such Security is registered in the name of a
Person other than the Depositary for such Global Security or a nominee thereof.
(e) The Depositary or its nominee, as the registered owner of
a Global Security, shall be the Holder of such Global Security for all purposes
under this Indenture and the Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable
Procedures.Accordingly, any such owner's beneficial interest in a Global
Security shall be shown only on, and the transfer of such interest shall be
effected only through, records maintained by the Depositary or its nominee or
its Agent Members. Neither the Trustee nor the Securities Registrar shall have
any liability in respect of any transfers effected by the Depositary.
(f) The rights of owners of beneficial interests in a Global
Security shall be exercised only through the Depositary and shall be limited to
those established by law and agreements between such owners and the Depositary
and/or its Agent Members.
Section 3.6. Registration, Transfer and Exchange Generally.
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Securities and
transfers of Securities. Such register is herein sometimes referred to as the
"Securities Register." The Trustee is hereby appointed "Securities Registrar"
for the purpose of registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any Security at the
offices or agencies of the Company designated for that purpose, 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 like tenor and aggregate principal
amount.
At the option of the Holder, Securities may be exchanged for other
Securities of the same series of any authorized denominations, of like tenor and
aggregate principal amount, upon surrender of the Securities to be exchanged at
such office or agency. Whenever any securities are so surrendered for
exchange,the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities that the Holder making the exchange is entitled to
receive.
All Securities issued upon any transfer or exchange of Securities shall
be the valid obligations of the Company, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Securities surrendered upon
such transfer or exchange.
Every Security presented or surrendered for transfer or exchange shall
(if so required by the Company or the Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Securities Registrar, duly executed by the Holder thereof or
such Holder's attorney duly authorized in writing.
No service charge shall be made to a Holder for any 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 transfer or exchange of Securities.
Neither the Company nor the Trustee shall be required, pursuant to the
provisions of this Section, (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 selection for redemption of Securities of that series
pursuant to Article XI and ending at the close of business on the day of mailing
of the notice of redemption, or (ii) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except, in the case of
any such Security to be redeemed in part, any portion thereof not to be
redeemed.
Section 3.7. Mutilated, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee together with
such security or indemnity as may be required by the Company or the Trustee to
save each of them harmless, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security of the same series,
of like tenor and aggregate principal amount, bearing the same legends, and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and to the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Security, and (ii) such security or indemnity as may be required by them to save
each of them 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 lieu of any such destroyed, lost or stolen Security, a new Security
of the same series, of like tenor and aggregate principal amount and bearing the
same legends as such destroyed, lost or stolen Security, and bearing a number
not contemporaneously outstanding.
If 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.
Upon the issuance of any new Security under this Section 3.7, 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 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 such 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 3.8. Payment of Interest and Additional Interest;
Interest Rights Preserved.
Interest and Additional Interest on any Security of any series that 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 in respect of Securities of such series, except
that, unless otherwise provided in the Securities of such series, interest
payable on the Stated Maturity of the principal of a Security shall be paid to
the Person to whom principal is paid. The initial payment of interest on any
Security of any series that is issued between a Regular Record Date and the
related Interest Payment Date shall be payable as provided in such Security or
in the Board Resolution pursuant to Section 3.1 with respect to the related
series of Securities.
Any interest on any Security that is due and payable, but is not timely
paid or duly provided for, on any Interest Payment Date for Securities of such
series (herein called "Defaulted Interest"), shall forthwith cease to be payable
to the registered Holder on the relevant Regular Record Date by virtue of having
been such Holder, and such Defaulted Interest may be paid by the Company, at it
selection 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 in respect of which interest is in default (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 and the date of the 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 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 a Security of
such series at the address of such Holder as it appears in the
Securities Register not less than 10 days prior to such
Special Record Date. The Trustee may, in its discretion, in
the name and at the expense of the Company, cause a similar
notice to be published at least once in a newspaper,
customarily published in the English language on each Business
Day and of general circulation in the Borough of Manhattan,
The City of New York, but such publication shall not be a
condition precedent to the establishment of such Special
Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been
mailed as aforesaid, such Defaulted Interest shall be paid to
the Persons in whose names the Securities of such series (or
their respective Predecessor Securities) are registered 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 in
any other lawful manner not inconsistent with the requirements
of any securities exchange on which the Securities of the
series in respect of which interest is in default may be
listed and, upon such notice as may be required by such
exchange (or by the Trustee if the Securities are not listed),
if, after notice given by the Company to the Trustee of the
proposed payment pursuant to this clause 2, such payment shall
be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon 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 interest, that were carried by such other Security.
Section 3.9. Persons Deemed Owners.
The Company, the Trustee and any agent of the Company or the Trustee
shall treat the Person in whose name any Security is registered as the owner of
such Security for the purpose of receiving payment of principal of and (subject
to Section 3.8) any interest on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any agent of the Company or the Trustee shall be affected by
notice to the contrary.
No holder of any beneficial interest in any Global Security held on its
behalf by a Depositary shall have any rights under this Indenture with respect
to such Global Security, and such Depositary may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the owner of such Global
Security for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by a Depositary or impair, as between a Depositary and
such holders of beneficial interests, the operation of customary practices
governing the exercise of the rights of the Depositary (or its nominee) as
Holder of any Security.
Section 3.10. Cancellation.
All Securities surrendered for payment, redemption, transfer or
exchange shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee, and any such Securities and Securities surrendered
directly to the Trustee for any such purpose 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 that the Company may
have acquired in any manner whatsoever, and all Securities so delivered shall be
promptly canceled by the Trustee. No Securities 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 shall
be destroyed by the Trustee and the Trustee shall deliver to the Company a
certificate of such destruction.
Section 3.11. 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 for any
partial period shall be computed on the basis of a 360-day year of twelve 30-day
months and the actual number of days elapsed in any partial month in such
period, and interest on the Securities of each series for a full period shall be
computed by dividing the rate per annum by the number of interest periods that
together constitute a full twelve months.
Section 3.12. Deferrals of Interest Payment Dates.
If specified as contemplated by Section 2.1 or Section 3.1 with respect
to the Securities of a particular series, so long as no Event of Default has
occurred and is continuing, the Company shall have the right, at any time during
the term of such series, from time to time to defer the payment of interest on
such Securities for such period or periods (each an "Extension Period") not to
exceed the number of consecutive quarterly, semi-annual or other periods that
equal five years with respect to each Extension Period, during which Extension
Periods the Company shall, if so specified as contemplated by Section 3.1, have
the right to make partial payments of interest on any Interest Payment Date. No
Extension Period shall end on a date other than an Interest Payment Date. At the
end of any such Extension Period, the Company shall pay all interest then
accrued and unpaid on the Securities (together with Additional Interest thereon,
if any, at the rate specified for the Securities of such series to the extent
permitted by applicable law). No Extension Period shall extend beyond the Stated
Maturity of the principal of the Securities of such series. In the event that
the Stated Maturity is advanced to a date prior to the end of an Extension
Period, such Extension Period shall be deemed to end on such date or such
earlier date as may be determined by the Company. In the event that any
Securities are called for redemption on the date prior to the end of an
Extension Period, with respect to such Securities, such Extension Period shall
be deemed to end on such date or such earlier date as may be determined by the
Company. During any Extension Period, the Company shall not (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Company's capital stock, or (ii)
make any payment of principal of or interest or premium,if any, on or repay,
repurchase or redeem any debt securities of the Company that rank pari passu in
all respects with or junior in interest to the Securities of such series (other
than (a) repurchases, redemptions or other acquisitions of shares of capital
stock of the Company (1) in connection with any employment contract, benefit
plan or other similar arrangement with or for the benefit of any one or more
employees, officers, directors or consultants, (2) in connection with a dividend
reinvestment or stockholder stock purchase plan or (3) in connection with the
issuance of capital stock of the Company (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a
result of an exchange, redemption or conversion of any class or series of the
Company's capital stock (or any capital stock of a Subsidiary of the Company)
for any class or series of the Company's capital stock or of any class or series
of the Company's indebtedness for any class or series of the Company's capital
stock, (c) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) any declaration of a
dividend in connection with any Rights Plan, or the issuance of rights, stock or
other property under any Rights Plan, or the redemption or repurchase of rights
pursuant thereto, (e) payments under the Guarantee, or (f) any dividend in the
form of stock, warrants, options or other rights where the dividend stock or the
stock issuable upon exercise of such warrants, options or other rights is the
same stock as that on which the dividend is being paid or ranks pari passu with
or junior to such stock). Prior to the termination of any such Extension Period,
the Company may further defer the payment of interest, provided that no Event of
Default has occurred and is continuing and provided further, that no Extension
Period shall exceed the period or periods specified in such Securities, extend
beyond the Stated Maturity of the principal of such Securities or end on a date
other than an Interest Payment Date. Upon the termination of any such Extension
Period and upon the payment of all accrued and unpaid interest and any
Additional Interest then due on any Interest Payment Date, the Company may elect
to begin a new Extension Period, subject to the above conditions. No interest or
Additional Interest shall be due and payable during an Extension Period, except
at the end thereof, but each installment of interest that would otherwise have
been due and payable during such Extension Period shall bear Additional Interest
as and to the extent as maybe specified as contemplated by Section 3.1. The
Company shall give the Holders of the Securities of such series and the Trustee
notice of its election to begin any such Extension Period at least one Business
Day prior to the earlier of (i) the date the Distributions on the Capital
Securities of such Issuer Trust would have been payable but for the election to
begin such Extension Period, and (ii) the date the Property Trustee of such
Issuer Trust is required to give notice to holders of such Capital Securities of
the record date or the date such Distributions are payable, but in any event not
less than one Business Day prior to such record date.
Section 3.13. Right of Set-Off.
With respect to the Securities of a series initially issued to an
Issuer Trust, notwithstanding anything to the contrary herein, the Company shall
have the right to set off any payment it is otherwise required to make in
respect of any such Security to the extent the Company has theretofore made, or
is concurrently on the date of such payment making, a payment under the
Guarantee relating to such Security or to a holder of Capital Securities
pursuant to an action undertaken under Section 5.8 of this Indenture.
Section 3.14. Agreed Tax Treatment.
Each Security issued hereunder shall provide that the Company and, by
its acceptance of a Security or a beneficial interest therein, the Holder of,
and any Person that acquires a beneficial interest in, such Security agree that
for United States Federal, state and local tax purposes it is intended that such
Security constitutes indebtedness.
Section 3.15. Advancing of Stated Maturity.
If specified as contemplated by Section 2.1 or Section 3.1 with respect
to the Securities of a particular series, upon the occurrence of a Tax Event,
the Company shall have the right to advance the Stated Maturity of the principal
of the Securities of such series to the minimum extent required in order to
allow for the payments of interest in respect of such Securities to continue to
be tax deductible, but in no event shall the resulting maturity of such
Securities of such series be less than 15 years from the date of original
issuance thereof. The Stated Maturity shall be advanced only if, in the opinion
of counsel to the Company experienced in such matters, (a) after advancing the
Stated Maturity, interest paid on such Securities will be deductible for the
United Stated federal income tax purposes and (b) advancing the Stated Maturity
will not result in a taxable event to holders of such Securities.at any time to
any date not earlier than the first date on which the Company has the right to
redeem the Securities of such series. In the event the Company elects to advance
the Stated Maturity of the Securities of such series, it shall give notice to
the Trustee and the Trustee shall give notice of such advancing to the Holders,
no less than 30 and no more than 60 days prior to the effectiveness thereof.
Section 3.16. CUSIP Numbers.
The Company, in issuing the Securities, may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notice of redemption and other similar or related materials as a convenience to
Holders; provided that any such notice or other materials may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of redemption or other materials
and that reliance may be placed only on the other identification numbers printed
on the Securities, and any such redemption shall not be affected by any defect
in or omission of such numbers.
ARTICLE IV.
SATISFACTION AND DISCHARGE
Section 4.1. Satisfaction and Discharge of Indenture.
This Indenture shall, upon Company Request, cease to be of further
effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for and as otherwise provided
in this Section 4.1) and the Trustee, on demand of and at the expense of the
Company,shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered
(other than (i) Securities that have been destroyed, lost or
stolen and that have been replaced or paid as provided in
Section 3.7 and (ii) Securities 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 Section 10.3) have
been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the
Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year of the date of
deposit, 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, and in the case of
subclause (B)(i), (ii) or (iii) above, has
deposited or caused to be deposited with the
Trustee as trust funds in trust for such
purpose an amount in the currency or
currencies in which the Securities of such
series are payable sufficient to pay and
discharge the entire indebtedness on such
Securities not theretofore delivered to the
Trustee for cancellation,for the principal
(and premium, if any) and interest (including
any Additional Interest) to the date of such
deposit (in the case of Securities that 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
hereunder by the Company; and
(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 this Indenture have
been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.7, the obligations of
the Trustee to any Authenticating Agent under Section 6.14 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Section 4.2 and the last
paragraph of Section 10.3 shall survive.
Section 4.2. 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 the Trustee, in accordance with the provisions of the Securities
and this Indenture, 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 the principal (and premium, if
any) and interest and Additional Interest for the payment of which such money or
obligations have been deposited with or received by the Trustee.
ARTICLE V.
REMEDIES
Section 5.1. Events of Default.
"Event of Default", wherever used herein with respect to the 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) except as may be specified pursuant to Section 3.1:
(1) default in the payment of any interest upon any Security
of that series, including any Additional Interest in respect
thereof, when it becomes due and payable, and continuance of
such default for a period of 30 days (subject to the deferral
of any due date in the case of an Extension Period); or
(2) default in the payment of the principal of (or premium, if
any, on) any Security of that series at its Maturity; or
(3) failure on the part of the Company duly to observe or
perform any other of the covenants or agreements on the part
of the Company in the Securities of that series or in this
Indenture for a period of 90 days after the date on which
written notice of such failure, requiring the Company to
remedy the same, shall have been given to the Company by the
Trustee by registered or certified mail or to the Company and
the Trustee by the Holders of at least 25% in aggregate
principal amount of the Outstanding Securities of that series;
or
(4) the occurrence of the appointment of a receiver or other
similar official in any liquidation, insolvency or similar
proceeding with respect to the Company or all or substantially
all of its property; or a court or other governmental agency
shall enter a decree or order and such decree or order shall
remain unstayed and undischarged for a period of 60 days; or
(5) any other Event of Default provided with respect to
S ecurities of that series.
Section 5.2. Acceleration of Maturity; Rescission and Annulment
If an Event of Default (other than an Event of Default specified in
Section 5.1(4)) 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% in aggregate principal amount of the Outstanding
Securities of that series may declare the principal amount (or, if the
Securities of that series are Discount Securities, such portion of the principal
amount 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), provided that, in the case of
the Securities of a series issued to an Issuer Trust, if, upon an Event of
Default, the Trustee or the Holders of not less than 25% in principal amount of
the Outstanding Securities of such series fail to declare the principal of all
the Outstanding Securities of such series to be immediately due and payable, the
holders of at least 25% in aggregate Liquidation Amount (as defined in the
related Trust Agreement) of the related series of Capital Securities issued by
such Issuer Trust then outstanding shall have the right to make such declaration
by a notice in writing to the Company and the Trustee; and upon any such
declaration such principal amount (or specified portion thereof) of and the
accrued interest (including any Additional Interest) on all the Securities of
such series shall become immediately due and payable. If an Event of Default
specified in Section 5.1(4) with respect to Securities of any series at the time
Outstanding occurs, the principal amount of all the Securities of such series
(or, if the Securities of such series are Discount Securities, such portion of
the principal amount of such Securities as may be specified by the terms of that
series) shall automatically, and without any declaration or other action on the
part of the Trustee or any Holder, become immediately due and payable. Payment
of principal and interest (including any Additional Interest) on such Securities
shall remain subordinated to the extent provided in Article XIII notwithstanding
that such amount shall become immediately due and payable as herein provided.
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 a majority in aggregate 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 interests on all
Securities of such series;
(B) any accrued Additional Interest on all Securities
of such series;
(C) the principal of (and premium, if any, on) any
Securities of such series that have become due otherwise than
by such declaration of acceleration and interest and
Additional Interest thereon at the rate borne by the
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 non-payment of the principal of
Securities of that series that has become due solely by such
acceleration, have been cured or waived as provided in Section
5.13.
In the case of Securities of a series initially issued to an Issuer
Trust,if the Holders of such Securities fail to annul such declaration and waive
such default, the holders of a majority in aggregate Liquidation Amount (as
defined in the related Trust Agreement) of the related series of Capital
Securities issued by such Issuer Trust then outstanding shall also have the
right to rescind and annul such declaration and its consequences by written
notice to the Company and the Trustee, subject to the satisfaction of the
conditions set forth in clauses (1) and (2) above of this Section 5.2.
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 (including any Additional 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 (and
premium, if any, on) any Security at the Maturity thereof, the
Company will, upon demand of the Trustee, pay to the Trustee,
for the benefit of the Holders of such Securities, the whole
amount then due and payable on such Securities for principal
(and premium, if any) and interest (including any Additional
Interest), and, in addition thereto, all amounts owing the
Trustee under Section 6.7.
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, and 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
monies adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
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 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 in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.
Section 5.4. Trustee May File Proofs of Claim.
In case of any receivership, insolvency, liquidation,
bankruptcy,reorganization, arrangement, adjustment, composition or other
judicial or administrative 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,
(a) the Trustee (irrespective of whether the principal of the
Securities of any series 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 overdue principal (and
premium, if any) or interest (including any Additional 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 (and premium, if any)
and interest (including any Additional Interest) owing and unpaid in respect to
the Securities and to file such other papers or documents as may be necessary or
advisable and to take any and all actions as are authorized under the Trust
Indenture Act in order to have the claims of the Holders and any predecessor to
the Trustee under Section 6.7 allowed in any such judicial or administrative
proceedings; and (ii) in particular, the Trustee shall be authorized to collect
and receive any monies or other property payable or deliverable on any such
claims and to distribute the same in accordance with Section 5.6; and
(b) any custodian, receiver, assignee, trustee, liquidator,
sequestrator,conservator (or other similar official) in any such judicial or
administrative proceeding is hereby authorized by each Holder to make such
payments to the Trustee for distribution in accordance with Section 5.6, 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 to it and any predecessor
Trustee under Section 6.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to 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; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
Section 5.5. Trustee May Enforce Claim 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, subject to
Article XIII and after provision for the payment of all the amounts owing the
Trustee and any predecessor Trustee under Section 6.7, 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 or property collected or to be applied by the Trustee with
respect to a series of Securities 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 or property on account of principal (or
premium,if any) or interest (including any Additional 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 6.7;
SECOND: Subject to Article XIII, to the payment of the amounts
then due and unpaid upon Securities of such series for
principal (and premium, if any) and interest (including any
Additional Interest) 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 series of Securities for principal
(and premium, if any) and interest (including any Additional
Interest), respectively; and
THIRD: The balance, if any, to the Person or Persons entitled
thereto.
Section 5.7. Limitation on Suits.
Subject to Section 5.8, no Holder of any Securities 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, assignee, trustee,
liquidator, sequestrator (or other similar official) 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 the
Securities of that series;
(2) the Holders of not less than 25% in aggregate principal
amount of the Outstanding Securities of that series shall have
made written request to 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 aggregate principal amount of the
Outstanding Securities of that series; it being understood and
intended that no one or more of such Holders shall have any
right in any manner whatever by virtue of, or by availing
itself of, any provision of this Indenture to affect, disturb
or prejudice the rights of any other Holders of Securities, or
to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the
equal and ratable benefit of all such Holders.
Section 5.8. Unconditional Right of Holders to Receive Principal,
Premium and Interest; Direct Action by Holders of Capital
Securities.
Notwithstanding any other provision in this Indenture, the Holder of
any Security of any series shall have the right, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Sections 3.8 and 3.12) interest (including any Additional Interest)
on such Security on the respective Stated Maturities expressed 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 an Issuer Trust, any registered holder of the series of Capital Securities
issued by such Issuer 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 Sections 3.8 and 3.12) interest
(including any Additional Interest) on the Securities having a principal amount
equal to the aggregate Liquidation Amount (as defined in the related Trust
Agreement) of such Capital Securities held by such holder.
Section 5.9. Restoration of Rights and Remedies.
If the Trustee, any Holder or any holder of Capital Securities issued
by any Issuer Trust 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, such Holder or such
holder of Capital Securities, then, and in every such case, the Company, the
Trustee, such Holders and such holder of Capital Securities shall, subject to
any determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee, such Holder and such holder of Capital Securities shall continue as
though no such proceeding had been instituted.
Section 5.10. Rights and Remedies Cumulative.
Except as otherwise provided in the last paragraph of Section 3.7, no
right or remedy herein conferred upon or reserved to the Trustee or 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, any Holder of any Security with
respect to the Securities of the related series or any holder of any Capital
Security to exercise any right or remedy accruing upon any Event of Default with
respect to the Securities of the related series 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 and the right and remedy given to the holders of Capital
Securities by Section 5.8 may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee, the Holders or the holders of Capital
Securities, as the case may be.
Section 5.12. Control by Holders.
The Holders of not less than a majority in aggregate 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 or with this Indenture,
(2) the Trustee may take any other action deemed proper by the
Trustee that is not inconsistent with such direction, and
(3) subject to the provisions of Section 6.1, the Trustee
shall have the right to decline to follow such direction if a
Responsible Officer or Officers of the Trustee shall, in good
faith, determine that the proceeding so directed would be
unjustly prejudicial to the Holders not joining in any such
direction or would involve the Trustee in personal liability.
Section 5.13. Waiver of Past Defaults.
The Holders of not less than a majority in aggregate principal amount
of the Outstanding Securities of any series affected thereby and, in the case of
any Securities of a series initially issued to an Issuer Trust, the holders of a
majority in aggregate Liquidation Amount (as defined in the related Trust
Agreement) of the Capital Securities issued by such Issuer Trust may waive any
past default hereunder and its consequences with respect to such series except a
default:
(1) in the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on any Security
of such series (unless such default has been cured and the
Company has paid to or deposited with the Trustee a sum
sufficient to pay all matured installments of interest
(including Additional Interest) and all principal of (and
premium, if any, on) all Securities of that series due
otherwise than by acceleration), or
(2) in respect of a covenant or provision hereof that under
Article IX cannot be modified or amended without the consent
of each Holder of any Outstanding Security of such series
affected.
Any such waiver shall be deemed to be on behalf of the Holders of all
the Securities of such series, or in the case of waiver by holders of Capital
Securities issued by such Issuer Trust, by all holders of Capital Securities
issued by such Issuer Trust. 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.
All parties to this Indenture agree, and each Holder of any Security by
his acceptance thereof shall be deemed to have agreed, that any court may, in
its discretion, require, 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 or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may, in its
discretion, assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant, but
the provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in aggregate principal amount of the Outstanding
Securities of any series, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of (or premium, if any) or interest
(including any Additional Interest) on any Security on or after the respective
Stated Maturities expressed in such Security.
Section 5.15. Waiver of Usury, 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 usury, 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.
ARTICLE VI.
THE TRUSTEE
Section 6.1. Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture,
and no implied covenants or obligations shall be read into
this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture, but in the
case of any such certificates or opinions that by any
provisions hereof are specifically required to be furnished to
the Trustee, the Trustee shall be under a duty to examine the
same to determine whether or not they conform to the
requirements of this Indenture.
(b) In case an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in their
exercise, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct except that
(1) this subsection shall not be construed to limit the
effect of subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall
be proved that the Trustee was negligent in ascertaining the
pertinent facts; and
(3) the 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 Holders pursuant to Section 5.12
relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee,
under this Indenture with respect to the Securities of a
series.
(d) 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 there shall be reasonable grounds for believing that
repayment of such funds or indemnity satisfactory to it against such risk or
liability is not reasonably assured to it.
(e) Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Trustee shall be subject to the provisions of
this Section.
Section 6.2. Notice of Defaults.
Within 90 days after actual knowledge by a Responsible Officer of the
Trustee of 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 Securities
Register, notice of such default, 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 (including any Additional
Interest) on any Security of such series, the Trustee shall be fully 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 Trustee in good faith determines that the withholding of such
notice is in the interests 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(3), no such notice to Holders of Securities of such series shall be
given until at least 30 days after the occurrence thereof. For the purpose of
this Section, the term "default" means any event that 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. Certain Rights of Trustee.
Subject to the provisions of Section 6.1:
(a) the Trustee may conclusively 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, Security 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 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, conclusively rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the advice of
such counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by 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 satisfactory
to it against the costs, expenses and liabilities that 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,
indenture,Security or other paper or document, but the Trustee in its discretion
may make such inquiry or investigation into such facts or matters as it may see
fit, and, if the Trustee shall determine to make such inquiry or investigation,
it shall be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney; and
(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.
(h) the Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Indenture.
(i) the Trustee shall not be charged with knowledge of any
Event of Default unless either (1) a Responsible Officer of the Trustee
shall have actual knowledge or (2) the Trustee shall have received notice
thereof from the Company or a Holder.
(j) no permissive power or authority available to the Trustee
shall be construed as a duty.
(k) 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 or a custodian or nominee, and the Trustee shall not be
responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder.
(l) in the event that the Trustee is also acting as Paying
Agent, Authenticating Agent or Transfer Agent and Registrar hereunder, the
rights and protections afforded to the Trustee pursuant to this Article VI shall
also be afforded such Paying Agent or Transfer Agent and Registrar.
Section 6.4. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and neither the Trustee nor any 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. 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 6.5. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Securities
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
6.8 and 6.13, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Securities
Registrar or such other agent.
Section 6.6. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.
Section 6.7. Compensation and Reimbursement.
(a) The Company agrees to pay to the Trustee from time to time
reasonable compensation for all services rendered by it hereunder in such
amounts as the Company and the Trustee shall agree from time to time (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust).
(b) Since the Issuer Trust is being formed solely to
facilitate an investment in the Trust Securities, the Company, as borrower,
hereby covenants to pay all debts and obligations (other than with respect to
the Capital Securities and the Common Securities) and all costs and expenses of
the Issuer Trust (including without limitation all costs and expenses relating
to the organization of the Issuer Trust, the fees and expenses of the trustees
and all costs and expenses relating to the operation of the Issuer Trust) and to
pay any and all taxes, duties, assessments or governmental charges of whatever
nature (other than withholding taxes) imposed on the Issuer Trust by the United
States, or any taxing authority, so that the net amounts received and retained
by the Issuer Trust and the Property Trustee after paying such expenses will be
equal to the amounts the Issuer Trust and the Property Trustee would have
received had no such costs or expenses been incurred by or imposed on the Issuer
Trust. The foregoing obligations of the Company are for the benefit of, and
shall be enforceable by, any person to whom any such debts, obligations, costs,
expenses and taxes are owed (each, a "Creditor") whether or not such Creditor
has received notice thereof. Any such Creditor may enforce such obligations of
the Company directly against the Company, and the Company irrevocably waives any
right or remedy to require that any such Creditor take any action against the
Issuer Trust or any other person before proceeding against the Company. The
Company shall execute such additional agreements as may be necessary or
desirable to give full effect to the foregoing.
(c) The Company agrees to indemnify the Trustee and its
officers, directors, employees and agents for, and to hold it harmless against,
any loss, liability or expense (including the reasonable compensation and the
expenses and disbursements of its agents and counsel) incurred without
negligence or bad faith, arising out of or in connection with the acceptance or
administration of this trust or the performance of its duties
hereunder,including the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of its powers
or duties hereunder. This indemnification shall survive the termination of this
Indenture or the earlier resignation or removal of the Trustee.
(d) The Company agrees 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), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 5.1(4) occurs, the expenses and the compensation
for the services are intended to constitute expenses of administration under the
Bankruptcy Reform Act of 1978 or any successor statute.
Section 6.8. Disqualification; Conflicting Interests.
(a) The Trustee for the Securities of any series issued
hereunder shall be subject to the provisions of Section 310(b) of the Trust
Indenture Act. Nothing herein shall prevent the Trustee from filing with the
Commission the application referred to in the second to last paragraph of said
Section 310(b).
(b) The Trust Agreement and the Guarantee Agreement with
respect to each Issuer Trust shall be deemed to be specifically described in
this Indenture for the purposes of clause (i) of the first proviso contained in
Section 310(b) of the Trust Indenture Act.
Section 6.9. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be:
(a) an entity organized and doing business under the laws of
the United States of America or of any state or territory thereof or of the
District of Columbia, authorized under such laws to exercise corporate trust
powers and subject to supervision or examination by Federal, state, territorial
or District of Columbia authority, or
(b) an entity or other Person organized and doing business
under the laws of a foreign government that is permitted to act as Trustee
pursuant to a rule, regulation or order of the Commission, authorized under such
laws to exercise corporate trust powers, and subject to supervision or
examination by authority of such foreign government or a political subdivision
thereof substantially equivalent to supervision or examination applicable to
United States institutional trustees, in either case having a combined capital
and surplus of at least $50,000,000, subject to supervision or examination by
Federal or state authority. If such entity publishes reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then, for the purposes of this Section, the
combined capital and surplus of such entity 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 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. Neither the Company
nor any Person directly or indirectly controlling, controlled by or under common
control with the Company shall serve as Trustee for the Securities of any series
issued hereunder.
Section 6.10. 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 6.11.
(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 aggregate
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 fail to comply with Section 6.8 after
written request therefor by the Company or by any Holder who
has been a bona fide Holder of a Security for at least six
months, or
(2) the Trustee shall cease to be eligible under Section 6.9
and shall fail to resign after written request therefor by the
Company or by any such Holder, or
(3) the Trustee shall become incapable of acting or shall 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, acting pursuant to the authority of a
Board Resolution, may remove the Trustee with respect to the Securities of all
series issued hereunder, or (ii) subject to Section 5.14, any Holder who has
been a bona fide Holder of a Security for at least six months may, on behalf of
such Holder and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to the Securities of
all series issued hereunder and the appointment of a successor Trustee or
Trustees.
(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
a Board Resolution,shall promptly appoint a successor Trustee with respect to
the Securities of that or those series. 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 aggregate 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,become the successor Trustee with respect to the
Securities of such series and 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 and accepted
appointment in the manner hereinafter provided, any Holder who has been a bona
fide Holder of a Security of such series for at least six months may, subject to
Section 5.14, on behalf of such Holder 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
the Holders of Securities of such series as their names and addresses appear in
the Securities 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.
Section 6.11. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor
Trustee with respect to all Securities, every 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.
(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
or 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 and each
removal of the retiring 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.
(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 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 6.12. Merger, Conversion, Consolidation or Succession to
Business.
Any entity into which the Trustee may be merged or converted or with
which it may be consolidated, or any entity resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any entity
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such entity
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, and in case any Securities shall not
have been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor Trustee or in the name of such
successor Trustee, and in all cases the certificate of authentication shall have
the full force which it is provided anywhere in the Securities or in this
Indenture that the certificate of the Trustee shall have.
Section 6.13. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
Section 6.14. Appointment of Authenticating Agent.
The Trustee may, by an instrument in writing, 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 Securities of such
series issued upon original issue and upon exchange, registration of transfer or
partial redemption thereof or pursuant to Section 3.6, and Securities so
authenticated shall be entitled to the benefits of this Indenture and shall be
valid and obligatory for all purposes as if authenticated 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. Each
Authenticating Agent shall be acceptable to the Company and shall at all times
be an entity organized and doing business under the laws of the United States of
America, or of any state or territory thereof or of the District of Columbia,
authorized under such laws to act as Authenticating Agent, having a combined
capital and surplus of not less than $50,000,000 and subject to supervision or
examination by Federal or state authority. If such Authenticating Agent
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for the purposes
of this Section the combined capital and surplus of such Authenticating Agent
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 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.
Any entity into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any entity resulting from any
merger,conversion or consolidation to which such Authenticating Agent shall be a
party,or any entity succeeding to all or substantially all of the corporate
trust business of an Authenticating Agent shall be the successor Authenticating
Agent hereunder, provided such entity 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.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent, which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 1.6 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance hereunder shall become vested
with all the rights, powers and duties 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 provision 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 be reimbursed for such payment, subject to the
provisions of Section 6.7.
If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities referred to in the within mentioned
Indenture.
Dated:___________________ BANKERS TRUST COMPANY,
as Trustee
By: _____________________________________________
Authorized Officer
---------------------------------------------
as Authenticating Agent
By: _____________________________________________
Authorized Officer
Name:
Title:
ARTICLE VII.
HOLDER'S LISTS AND REPORTS BY TRUSTEE,
PAYING AGENT AND COMPANY
Section 7.1. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not more than 15 days after January 1 and
July 1 of each year, a list, in such form as the Trustee may reasonably require,
of the names and addresses of the Holders as of such dates, and
(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company 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 furnished, in each case to the extent such information is in the
possession or control of the Company, and excluding from any such list names and
addresses received by the Trustee in its capacity as Securities Registrar.
Section 7.2. Preservation of Information, Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 7.1 and the names
and addresses of Holders received by the Trustee in its capacity as Securities
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.1 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders
with respect to their rights under this Indenture or under the Securities, and
the corresponding rights and privileges of the Trustee, shall be as provided in
the Trust Indenture Act.
(c) 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 agent of either of them shall be held accountable by reason of
the disclosure of information as to the names and addresses of the Holders made
pursuant to the Trust Indenture Act.
Section 7.3. Reports by Trustee and Paying Agent.
(a) The Trustee shall transmit to Holders such reports
concerning the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act, at the times and in the manner provided
pursuant thereto.
(b) Reports so required to be transmitted at stated intervals
of not more than 12 months shall be transmitted no later than January 31 in each
calendar year, commencing with the first January 31 after the first issuance of
Securities under this Indenture.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each securities exchange
upon which any Securities are listed and also with the Commission. The Company
will notify the Trustee when any Securities are listed on any securities
exchange.
(d) The Paying Agent shall comply with all withholding, backup
withholding, tax and information reporting requirements under the Internal
Revenue Code of 1986, as amended, and the Treasury Regulations issued thereunder
with respect to payments on, or with respect to, the Securities.
Section 7.4. Reports by Company.
The Company shall file or cause to be filed with the Trustee and with
the Commission, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided in the Trust Indenture
Act. In the case of information, documents or reports required to be filed with
the Commission pursuant to Section 13(a) or Section 15(d) of the Exchange Act,
the Company shall file or cause the filing of such information, documents or
reports with the Trustee within 15 days after the same are required to be filed
with the Commission. Notwithstanding that the Company may not be required to
remain subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, the Company shall continue to file with the Commission and provide
the Trustee with the annual reports and the information, documents and other
reports which are specified in Sections 13 and 15(d) of the Exchange Act. The
Company also shall comply with the other provisions of Section 314(a) of the
Trust Indenture Act.
ARTICLE VIII.
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 Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and no Person shall consolidate with or merge into the
Company or convey, transfer or lease its properties and assets substantially as
an entirety to the Company, unless:
(1) If the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, the entity
formed by such consolidation or into which the Company is
merged or the Person that acquires by conveyance or transfer,
or that leases, the properties and assets of the Company
substantially as an entirety shall be an entity organized and
existing under the laws of the United States of America or 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 (including any Additional Interest) on
all the Securities of every series 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, no
Event of Default, and no event that, after notice or lapse of
time, or both, would constitute an Event of Default, shall
have occurred and be continuing; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and any
such supplemental indenture comply with this Article and that
all conditions precedent herein provided for relating to such
transaction have been complied with and, in the case of a
transaction subject to this Section 8.1 but not requiring a
supplemental indenture under paragraph (1) of this Section
8.1, an Officer's Certificate or Opinion of Counsel to the
effect that the surviving, resulting or successor entity is
legally bound by the Indenture and the Securities; and the
Trustee, subject to Section 6.1, may rely upon such Officers'
Certificates and Opinions of Counsel as conclusive evidence
that such transaction complies with this Section 8.1.
Section 8.2. Successor Company Substituted.
Upon any consolidation or merger by the Company with or into any other
Person, or any conveyance, transfer or lease by the Company of its properties
and assets substantially as an entirety to any Person in accordance with Section
8.1, the successor entity 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 Person
had been named as the Company herein; and in the event of any such
conveyance,transfer or lease the Company shall be discharged from all
obligations and covenants under the Indenture and the Securities.
Such successor Person may cause to be executed, and may issue either in
its own name or in the name of the Company, any or all of the Securities
issuable hereunder that theretofore shall not have been signed by the Company
and delivered to the Trustee; and, upon the order of such successor Person
instead of the Company and subject to all the terms, conditions and limitations
in this Indenture prescribed, the Trustee shall authenticate and shall deliver
any Securities that previously shall have been signed and delivered by the
officers of the Company to the Trustee for authentication pursuant to such
provisions and any Securities that such successor Person thereafter shall cause
to be executed and delivered to the Trustee on its behalf for the purpose
pursuant to such provisions. All the Securities so issued shall in all respects
have the same legal rank and benefit under this Indenture as the Securities
theretofore or thereafter issued in accordance with the terms of this Indenture.
In case of any such consolidation, merger, sale, conveyance or lease,
such changes in phraseology and form may be made in the Securities thereafter to
be issued as may be appropriate.
ARTICLE IX.
SUPPLEMENTAL INDENTURES
Section 9.1. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may amend
or waive any provision of this Indenture or 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 Person to the
Company, and the assumption by any such successor of the
covenants of the Company herein and in the Securities
contained; or
(2) to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee or to surrender any right or
power herein conferred upon the Company; or
(3) to establish the form or terms of Securities of any series
as permitted by Sections 2.1 or 3.1; or
(4) to facilitate the issuance of Securities of any series in
certificated or other definitive form; or
(5) 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 the series specified) or to
surrender any right or power herein conferred upon the
Company; or
(6) to add any additional Events of Default for the benefit of
the Holders of all or any series of Securities (and if such
additional Events of Defaults are to be for the benefit of
less than all series of Securities, stating that such
additional Events of Default are expressly being included
solely for the benefit of the series specified); or
(7) to change or eliminate any of the provisions of this
Indenture, provided that any such change or elimination shall
(a) become effective only when there is no Security
Outstanding of any series created prior to the execution of
such supplemental indenture that is entitled to the benefit of
such provision or (b) not apply to any Outstanding Securities;
or
(8) to cure any ambiguity, to correct or supplement any
provision herein that 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 that such action pursuant to this clause
(8) shall not adversely affect the interest of the Holders of
Securities of any series in any material respect or, in the
case of the Securities of a series issued to an Issuer Trust
and for so long as any of the corresponding series of Capital
Securities issued by such Issuer Trust shall remain
outstanding, the holders of such Capital Securities; or
(9) 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 6.11(b); or
(10) to comply with the requirements of the Commission in
order to effect or maintain the qualification of this
Indenture under the Trust Indenture Act.
Section 9.2. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in
aggregate 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 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 of each series affected thereby,
(1) change the Stated Maturity of the principal of, or any
installment of interest (including any Additional Interest)
on, any Security, or reduce the principal amount thereof or
the rate of interest thereon or any premium payable upon the
redemption thereof, or reduce the amount of principal of a
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 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
(2) reduce the percentage in aggregate 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 10.5, 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 Security affected thereby;
provided, further, that, in the case of the Securities of a series issued to an
Issuer Trust, so long as any of the corresponding series of Capital Securities
issued by such Issuer Trust remains outstanding, (i) no such amendment shall be
made that adversely affects the holders of such Capital Securities in any
material respect, and no termination of this Indenture shall occur, and no
waiver of any Event of Default or compliance with any covenant under this
Indenture shall be effective, without the prior consent of the holders of at
least a majority of the aggregate Liquidation Amount (as defined in the related
Trust Agreement) of such Capital Securities then outstanding unless and until
the principal of (and premium, if any, on) the Securities of such series and all
accrued and (subject to Section 3.8) unpaid interest (including any Additional
Interest) thereon have been paid in full, and (ii) no amendment shall be made to
Section 5.8 of this Indenture that would impair the rights of the holders of
Capital Securities issued by an Issuer Trust provided therein without the prior
consent of the holders of each such Capital Security then outstanding unless and
until the principal of (and premium, if any, on) the Securities of such series
and all accrued and (subject to Section 3.8) unpaid interest (including any
Additional Interest) thereon have been paid in full.
A supplemental indenture that changes or eliminates any covenant or
other provision of this Indenture that has expressly been included solely for
the benefit of one or more particular series of Securities or any corresponding
series of Capital Securities of an Issuer Trust that holds the Securities of any
series, or that modifies the rights of the Holders of Securities of such series
or holders of such Capital Securities of such corresponding 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 or holders
of Capital Securities of any other such corresponding series.
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.
In 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 6.1) shall be fully protected in conclusively relying
upon, an Officers' Certificate and an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture, and that all conditions precedent herein provided for relating to
such action have been complied with. The Trustee may, but shall not be obligated
to, enter into any such supplemental indenture that 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 Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 9.5. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
Section 9.6. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Company, bear a notation in form approved by the Company 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 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.
ARTICLE X.
COVENANTS
Section 10.1. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay or cause to be paid the
principal of (and premium, if any) and interest (including any Additional
Interest) on each of the Securities of that series in accordance with the terms
of such Securities and this Indenture.
Section 10.2. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency 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 initially appoints the Trustee, acting through its
Corporate Trust Office, as its agent for said purposes. The Company will give
prompt written notice to the Trustee of any change in the location of any such
office or agency. If at any time the Company shall fail to maintain such 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 the Company hereby appoints the
Trustee as its agent to receive all such presentations,surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all of such purposes, 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 Securities of any series for such purposes. The Company
will give prompt written notice to the Trustee of any such designation and any
change in the location of any such office or agency.
Section 10.3. Money for Security 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 (including Additional Interest)
on any of the Securities of such series, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum sufficient to pay the principal
(and premium, if any) or interest (including Additional 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 failure so to act.
Whenever the Company shall have one or more Paying Agents, it will,
prior to 10:00 a.m., New York City time, on each due date of the principal of
(or premium, if any) or interest, including Additional Interest on any
Securities,deposit with a Paying Agent a sum sufficient to pay the principal
(and premium,if any) or interest, including Additional Interest so becoming due,
such sum to be held in trust for the benefit of the Persons entitled to such
principal (and premium, if any) or interest, including Additional Interest, and
(unless such Paying Agent is the Trustee) the Company will promptly notify the
Trustee of its failure so to act.
The Company will cause each Paying Agent 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 (including Additional
Interest) on the Securities of a 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 such Securities) in the making of any
payment of principal (and premium, if any) or interest (or
Additional Interest) in respect of any Security of any Series;
(3) at any time during the continuance of any default with
respect to a series of Securities, upon the written request of
the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent with respect to such series; and
(4) comply with the provisions of the Trust Indenture Act
applicable to it as a 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 terms 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 (including Additional Interest) on any Security and remaining
unclaimed for two years after such principal (and premium, if any) or
interest(including Additional Interest) has become due and payable shall (unless
otherwise required by mandatory provision of applicable escheat or abandoned or
unclaimed property law) be paid on Company Request to the Company, or (if then
held by the Company) shall (unless otherwise required by mandatory provision of
applicable escheat or abandoned or unclaimed property law) 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 cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, the City of New York, 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, any unclaimed balance of such money then remaining
will be repaid to the Company.
Section 10.4. Statement as to Compliance.
The Company shall 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 covering the preceding calendar year, stating whether or not to the
best knowledge of the signers thereof the Company is in default in the
performance, observance or fulfillment of or compliance with any of the
terms,provisions, covenants and conditions of this Indenture, and if the Company
shall be in default, specifying all such defaults and the nature and status
thereof of which they may have knowledge. For the purpose of this Section 10.4,
compliance shall be determined without regard to any grace period or requirement
of notice provided pursuant to the terms of this Indenture.
Section 10.5. Waiver of Certain Covenants.
Subject to the rights of holders of Capital Securities specified in
Section 9.2, if any, the Company may omit in any particular instance to comply
with any covenant or condition provided pursuant to Section 3.1, 9.1(3) or
9.1(4) with respect to the Securities of any series, if before or after the time
for such compliance the Holders of at least a majority in aggregate principal
amount of the Outstanding Securities of such series 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 in
respect of any such covenant or condition shall remain in full force and effect.
Section 10.6. Additional Sums.
In the case of the Securities of a series initially issued to an Issuer
Trust, so long as no Event of Default has occurred and is continuing and except
as otherwise specified as contemplated by Section 2.1 or Section 3.1, if (i) an
Issuer Trust is the Holder of all of the Outstanding Securities of such series,
and (ii) a Tax Event has occurred and is continuing in respect of such Issuer
Trust, the Company shall pay to such Issuer Trust (and its permitted successors
or assigns under the related Trust Agreement) for so long as such Issuer Trust
(or its permitted successor or assignee) is the registered holder of the
Outstanding Securities of such series, such additional sums as maybe necessary
in order that the amount of Distributions (including any Additional Amounts (as
defined in such Trust Agreement)) then due and payable by such Issuer Trust on
the related Capital Securities and Common Securities that at anytime remain
outstanding in accordance with the terms thereof shall not be reduced as a
result of such Additional Taxes (the "Additional Sums"). Whenever in this
Indenture or the Securities there is a reference in any context to the payment
of principal of or interest on the Securities, such mention shall be deemed to
include mention of the payments of the Additional Sums provided for in this
paragraph to the extent that, in such context, Additional Sums are, were or
would be payable in respect thereof pursuant to the provisions of this paragraph
and express mention of the payment of Additional Sums (if applicable) in any
provisions hereof shall not be construed as excluding Additional Sums in those
provisions hereof where such express mention is not made; provided, however,
that the deferral of the payment of interest pursuant to Section 3.12 on the
Securities shall not defer the payment of any Additional Sums that may be due
and payable.
Section 10.7. Additional Covenants.
The Company covenants and agrees with each Holder of Securities of each
series that it shall not (i) declare or pay any dividends or distributions on,or
redeem, purchase, acquire or make a liquidation payment with respect to, any
shares of the Company's capital stock, or (ii) make any payment of principal of
or interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Company that rank pari passu in all respects with or junior in
interest to the Securities of such series (other than (a) repurchases,
redemptions or other acquisitions of shares of capital stock of the Company (1)
in connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of any one or more employees, officers,
directors or consultants, (2) in connection with a dividend reinvestment or
stockholder stock purchase plan or (3) in connection with the issuance of
capital stock of the Company (or securities convertible into or exercisable for
such capital stock) as consideration in an acquisition transaction entered into
prior to the applicable Extension Period or other event referred to below, (b)
as a result of an exchange, redemption or conversion of any class or series of
the Company's capital stock(or any capital stock of a Subsidiary of the Company)
for any class or series of the Company's capital stock or of any class or series
of the Company's indebtedness for any class or series of the Company's capital
stock, (c) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) any declaration of a
dividend in connection with any Rights Plan, or the issuance of rights, stock or
other property under any Rights Plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or junior to such stock) if at
such time (i) there shall have occurred any event (A) of which the Company has
actual knowledge that with the giving of notice or the lapse of time, or
both,would constitute an Event of Default with respect to the Securities of such
series, and (B) which the Company shall not have taken reasonable steps to cure,
(ii) if the Securities of such series are held by an Issuer Trust, the Company
shall be in default with respect to its payment of any obligations under the
Guarantee relating to the Capital Securities issued by such Issuer Trust, or
(iii) the Company shall have given notice of its election to begin an Extension
Period with respect to the Securities of such series as provided herein and
shall not have rescinded such notice, or such Extension Period, or any extension
thereof, shall be continuing.
The Company also covenants with each Holder of Securities of a series
issued to an Issuer Trust (i) to hold, directly or indirectly, 100% of the
Common Securities of such Issuer Trust, provided that any permitted successor of
the Company as provided under Section 8.2 may succeed to the Company's ownership
of such Common Securities, (ii) as holder of such Common Securities, not to
voluntarily terminate, windup or liquidate such Issuer Trust, other than (a) in
connection with a distribution of the Securities of such series to the holders
of the related Capital Securities in liquidation of such Issuer Trust, or (b) in
connection with certain mergers, consolidations or amalgamations permitted by
the related Trust Agreement, and (iii) to use its reasonable efforts, consistent
with the terms and provisions of such Trust Agreement, to cause such Issuer
Trust to continue not to be taxable as a corporation for United States Federal
income tax purposes.
Section 10.8. Original Issue Discount.
On or before December 15 of each year during which any Securities are
outstanding, the Company shall furnish to each Paying Agent such information as
may be necessary by each Paying Agent in order that each Paying Agent 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 Internal
Revenue Code of 1986, as amended. Such information shall include the amount of
original issue discount includible in income for each authorized minimum
denomination of principal amount at Stated Maturity of outstanding Securities
during such year.
ARTICLE XI.
REDEMPTION OF SECURITIES
Section 11.1. Applicability of This Article.
Redemption of Securities of any series as permitted or required by any
form of Security issued pursuant to this Indenture shall be made in accordance
with such form of Security and this Article; provided, however, that, if any
provision of any such form of Security shall conflict with any provision of this
Article, the provision of such form of Security shall govern. Except as
otherwise set forth in the form of Security for such series, each Security of a
series shall be subject to partial redemption only in an amount of $25 or any
integral multiples thereof.
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, the Company shall, not less than 30 nor more than 60 days prior
to the Redemption Date (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee in writing and, in the case of Securities of a
series held by an Issuer Trust, the Property Trustee under the related Trust
Agreement, of such date and of the principal amount of Securities of the
applicable series to be redeemed and provide the additional information required
to be included in the notice or notices contemplated by Section 11.4; provided
that, in the case of any series of Securities initially issued to an Issuer
Trust, for so long as such Securities are held by such Issuer Trust, such notice
shall be given not less than 45 nor more than 75 days prior to such Redemption
Date (unless a shorter notice shall be satisfactory to the Property Trustee
under the related Trust Agreement). 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, the Company shall furnish the Trustee with an
Officers' Certificate and an Opinion of Counsel evidencing compliance with such
restriction.
Section 11.3. Selection 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 a portion of the principal amount of any Security of such
series,provided that the unredeemed portion of the principal amount of any
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
The Trustee shall promptly notify the Company in writing of the
Securities selected for partial redemption and 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 Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security that has been or is to be
redeemed.
Section 11.4. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not later than the thirtieth day, and not earlier than the
sixtieth day, prior to the Redemption Date, to each Holder of Securities to be
redeemed, at the address of such Holder as it appears in the Securities
Register.
With respect to Securities of such series to be redeemed, each notice
of redemption shall state:
(a) the Redemption Date;
(b) 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 (if such an
estimate of the Redemption Price is given, a subsequent notice shall be given as
set forth above setting forth the Redemption Price promptly following the
calculation thereof);
(c) if less than all Outstanding Securities of such particular
series are to be redeemed, the identification (and, in the case of partial
redemption, the respective principal amounts) of the particular Securities to be
redeemed;
(d) that, on the Redemption Date, the Redemption Price will
become due and payable upon each such Security or portion thereof, and that
interest thereon, if any, shall cease to accrue on and after said date;
(e) the place or places where such Securities are to be
surrendered for payment of the Redemption Price;
(f) such other provisions as may be required in respect of the
terms of a particular series of Securities; and
(g) 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 and shall be
irrevocable.The notice, if mailed in the manner provided above, shall be
conclusively presumed to have been duly given, whether or not the Holder
receives such notice. In any case, a failure to give such notice by mail or any
defect in the notice to the Holder of any Security designated for redemption as
a whole or in part shall not affect the validity of the proceedings for the
redemption of any other Security.
Section 11.5. Deposit of Redemption Price.
Prior to 10:00 a.m., New York City time, on the Redemption Date
specified in the notice of redemption given as provided in Section 11.4, the
Company will deposit with the Trustee or with one or more Paying Agents (or if
the Company is acting as its own Paying Agent, the Company will segregate and
hold in trust as provided in Section 10.3) an amount of money sufficient to pay
the Redemption Price of, and any accrued interest (including Additional
Interest) on, all the Securities (or portions thereof) that are to be redeemed
on that date.
Section 11.6. Payment of Securities Called for Redemption.
If any notice of redemption has been given as provided in Section 11.4,
the Securities or portion of Securities with respect to which such notice has
been given shall become due and payable on the date and at the place or places
stated in such notice at the applicable Redemption Price, together with accrued
interest (including any Additional Interest) to the Redemption Date. On
presentation and surrender of such Securities at a Place of Payment in said
notice specified, the said Securities or the specified portions thereof shall be
paid and redeemed by the Company at the applicable Redemption Price, together
with accrued interest (including any Additional Interest) to the Redemption
Date; provided, however, that, unless otherwise specified as contemplated by
Section 3.1, installments of interest (including Additional Interest) whose
Stated Maturity is on or prior to the Redemption Date will be payable to the
Holders of such Securities, or one or more Predecessor Securities, registered as
such at the close of business on the relevant record dates according to their
terms and the provisions of Section 3.8.
Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and deliver to the Holder
thereof, at the expense of the Company, a new Security or Securities of the same
series, of authorized denominations, in aggregate principal amount equal to the
unredeemed portion of the Security so presented and having the same Original
Issue Date, Stated Maturity and terms.
If any Security called for redemption shall not be so paid under
surrender thereof for redemption, the principal of and premium, if any, on such
Security shall, until paid, bear interest from the Redemption Date at the rate
prescribed therefor in the Security.
Section 11.7. Right of Redemption of Securities Initially Issued to an
Issuer Trust.
In the case of the Securities of a series initially issued to an Issuer
Trust, except as otherwise specified as contemplated by Section 3.1, the
Company, at its option, may redeem such Securities (i) on or after the date
specified in such Security, in whole at any time or in part from time to time,
or (ii) prior to the date specified in the Security, in whole (but not in part)
at any time within 90 days following the occurrence and during the continuation
of such Tax Event or Investment Company Event (the "90-Day Period"), in each
case at a Redemption Price equal to the accrued and unpaid interest on such
Securities to the date fixed for redemption plus 100% of the principal amount
set forth on such Security, unless otherwise specified in such Security;
provided, however that if at the time there is available to the Company or the
Issuer Trust the opportunity to eliminate, within the 90-Day Period, the Tax
Event or Investment Company Event by taking some ministerial action
("Ministerial Action"), such as filing a form or making an election, or pursuing
some other similar reasonable measure that will have no adverse effect on the
Company, the Issuer Trust or the holders of the Trust Securities and will
involve no material cost, the Company shall pursue such measures in lieu of
redemption; provided, further, that the Company shall have no right to redeem
the Securities while the Issuer Trust is pursuing any Ministerial Action
pursuant to the Trust Agreement.
If less than all the Securities of any such series are to be redeemed,
the aggregate principal amount of such Securities remaining Outstanding after
giving effect to such redemption shall be sufficient to satisfy any provisions
of the Trust Agreement related to the Issuer Trust to which such Securities were
issued.
ARTICLE XII.
SINKING FUNDS
Except as may be provided in any supplemental or amended indenture, no
sinking fund shall be established or maintained for the retirement of Securities
of any series.
ARTICLE XIII.
SUBORDINATION OF SECURITIES
Section 13.1. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article, the payment of the principal
of (and premium, if any) and interest (including any Additional Interest) on
each and all of the Securities of each and every series are hereby expressly
made subordinate and subject in right of payment to the prior payment in full of
all Senior Indebtedness.
Section 13.2. No Payment When Senior Indebtedness in Default; Payment
Over of Proceeds Upon Dissolution, Etc.
If the Company shall default in the payment of any principal of (or
premium, if any) or interest on any Senior Indebtedness when the same becomes
due and payable, whether at maturity or at a date fixed for prepayment or by
declaration of acceleration or otherwise, then, upon written notice of such
default to the Company by the holders of Senior Indebtedness or any trustee
therefor, unless and until such default shall have been cured or waived or shall
have ceased to exist, no direct or indirect payment (in cash, property,
securities, by set-off or otherwise) shall be made or agreed to be made on
account of the principal of (or premium, if any) or interest (including
Additional Interest) on any of the Securities, or in respect of any
redemption,repayment, retirement, purchase or other acquisition of any of the
Securities.
In the event of (i) any insolvency, bankruptcy, receivership,
liquidation, reorganization, readjustment, composition or other similar
proceeding relating to the Company, its creditors or its property, (ii) any
proceeding for the liquidation, dissolution or other winding up of the Company,
voluntary or involuntary, whether or not involving insolvency or bankruptcy
proceedings, (iii) any assignment by the Company for the benefit of creditors or
(iv) any other marshalling of the assets of the Company (each such event, if
any, herein sometimes referred to as a "Proceeding"), all Senior Indebtedness
(including any interest thereon accruing after the commencement of any such
proceedings) shall first be paid in full before any payment or distribution,
whether in cash, securities or other property, shall be made to any Holder of
any of the Securities on account thereof. Any payment or distribution, whether
in cash, securities or other property (other than securities of the Company or
any other entity provided for by a plan of reorganization or readjustment, the
payment of which is subordinate, at least to the extent provided in these
subordination provisions with respect to the indebtedness evidenced by the
Securities, to the payment of all Senior Indebtedness at the time outstanding
and to any securities issued in respect thereof under any such plan of
reorganization or readjustment), which would otherwise (but for these
subordination provisions) be payable or deliverable in respect of the Securities
of any series shall be paid or delivered directly to the holders of Senior
Indebtedness in accordance with the priorities then existing among such holders
until all Senior Indebtedness (including any interest thereon accruing after the
commencement of any Proceeding) shall have been paid in full.
In the event of any Proceeding, after payment in full of all sums owing
with respect to Senior Indebtedness, the Holders of the Securities, together
with the holders of any obligations of the Company ranking on a parity with the
Securities, shall be entitled to be paid from the remaining assets of the
Company the amounts at the time due and owing on account of unpaid principal
of(and premium, if any) and interest on the Securities and such other
obligations before any payment or other distribution; whether in cash, property
or otherwise, shall be made on account of any capital stock or any obligations
of the Company ranking junior to the Securities, and such other obligations. If,
notwithstanding the foregoing, any payment or distribution of any character or
any security, whether in cash, securities or other property (other than
securities of the Company or any other entity provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to
the extent provided in these subordination provisions with respect to the
indebtedness evidenced by the Securities, to the payment of all Senior
Indebtedness at the time outstanding and to any securities issued in respect
thereof under any plan of reorganization or readjustment), shall be received by
the Trustee or any Holder in contravention of any of the terms hereof and before
all Senior Indebtedness shall have been paid in full,such payment or
distribution or security shall be received in trust for the benefit of, and
shall be paid over or delivered and transferred to, the holders of the Senior
Indebtedness at the time outstanding in accordance with the priorities then
existing among such holders for application to the payment of all Senior
Indebtedness remaining unpaid, to the extent necessary to pay all such Senior
Indebtedness in full. In the event of the failure of the Trustee or any Holder
to endorse or assign any such payment, distribution or security, each holder of
Senior Indebtedness is hereby irrevocably authorized to endorse or assign the
same.
The Trustee and the Holders shall take such action (including, without
limitation, the delivery of this Indenture to an agent for the holders of Senior
Indebtedness or consent to the filing of a financing statement with respect
hereto) as may, in the opinion of counsel designated by the holders of a
majority in principal amount of the Senior Indebtedness at the time
outstanding,be necessary or appropriate to assure the effectiveness of the
subordination effected by these provisions.
The provisions of this Section 13.2 shall not impair any rights,
interests,remedies or powers of any secured creditor of the Company in respect
of any security interest the creation of which is not prohibited by the
provisions of this Indenture.
The securing of any obligations of the Company, otherwise ranking on a
parity with the Securities or ranking junior to the Securities shall not be
deemed to prevent such obligations form constituting, respectively, obligations
ranking on a parity with the Securities or ranking junior to the Securities.
Section 13.3. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in this Indenture or in
any of the Securities shall prevent (a) the Company, at any time, except during
the pendency of the conditions described in the first paragraph of Section 13.2
or of any Proceeding referred to in Section 13.2, from making payments at any
time of principal of (and premium, if any) or interest (including Additional
Interest) on the Securities, or (b) the application by the Trustee of any monies
deposited with it hereunder to the payment of or on account of the principal
of(and premium, if any) or interest (including any Additional Interest) on the
Securities or the retention of such payment by the Holders, if, at the time of
such application by the Trustee, it did not have knowledge that such payment
would have been prohibited by the provisions of this Article.
Section 13.4. Subrogation to Rights of Holders of Senior Indebtedness.
Subject to the payment in full of all amounts due or to become due on
all Senior Indebtedness, or the provision for such payment in cash or cash
equivalents or otherwise in a manner satisfactory to the holders of Senior
Indebtedness, the Holders of the Securities shall be subrogated to the extent of
the payments or distributions made to the holders of such Senior Indebtedness
pursuant to the provisions of this Article (equally and ratably with the holders
of all indebtedness of the Company that by its express terms is subordinated to
Senior Indebtedness of the Company to substantially the same extent as the
Securities are subordinated to the Senior Indebtedness and is entitled to like
rights of subrogation by reason of any payments or distributions made to holders
of such Senior Indebtedness) to the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness until the principal of (and
premium if any) and interest (including Additional Interest) on the Securities
shall be paid in full. For purposes of such subrogation, no payments or
distributions to the holders of the Senior Indebtedness of any cash, property or
securities to which the Holders of the Securities or the Trustee would been
titled except for the provisions of this Article, and no payments pursuant to
the provisions of this Article to the holders of Senior Indebtedness by Holders
of the Securities or the Trustee, shall, as among the Company, its creditors
other than holders of Senior Indebtedness, and the Holders of the Securities, be
deemed to be a payment or distribution by the Company to or on account of the
Senior Indebtedness.
Section 13.5. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the Holders of the Securities on the
one hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article or elsewhere in this Indenture or in the Securities is
intended to or shall (a) impair, as between the Company and the Holders of the
Securities,the obligations of the Company, which are absolute and unconditional,
to pay to the Holders of the Securities the principal of (and premium, if any)
and interest (including any Additional 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 against the Company of the Holders of the Securities
and creditors of the Company other than their rights in relation to the holders
of Senior Indebtedness; or (c) prevent the Trustee or the Holder of any
Security(or to the extent expressly provided herein, the holder of any Capital
Security)from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, including filing and voting claims in any
Proceeding,subject to the rights, if any, under this Article of the holders of
Senior Indebtedness to receive cash, property and securities otherwise payable
or deliverable to the Trustee or such Holder.
Section 13.6. Trustee to Effectuate Subordination.
Each Holder of a Security by his or her acceptance thereof authorizes
and directs the Trustee on his or her behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination provided
in this Article and appoints the Trustee his or her attorney-in-fact for any and
all such purposes.
Section 13.7. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Indebtedness 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 by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof that any such holder may have or
be otherwise charged with. Without in any way limiting the generality of the
immediately preceding paragraph, the holders of Senior Indebtedness may, at any
time and from time to time, without the consent of or notice to the Trustee or
the Holders of the Securities of any series, without incurring responsibility to
such Holders of the Securities and without impairing or releasing the
subordination provided in this Article or the obligations hereunder of such
Holders of the Securities to the holders of Senior Indebtedness, do any one or
more of the following: (i) change the manner, place or terms of payment or
extent the time of payment of,or renew or alter, Senior Indebtedness, or
otherwise amend or supplement in any manner Senior Indebtedness or any
instrument evidencing the same or any agreement under which Senior Indebtedness
is outstanding; (ii) sell, exchange,release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Indebtedness; (iii) release any
Person liable in any manner for the collection of Senior Indebtedness; and (iv)
exercise or refrain from exercising any rights against the Company and any other
Person.
Section 13.8. Notice to Trustee.
The Company shall give prompt written notice to a Responsible Officer
of the Trustee of any fact known to the Company that would prohibit the making
of any payment to or by the Trustee in respect of the Securities.
Notwithstanding the provisions of this Article or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment to or by the Trustee in
respect of the Securities, unless and until the Trustee shall have received
written notice thereof from the Company or a holder of Senior Indebtedness or
from any trustee,agent or representative therefor; provided, however, that if
the Trustee shall not have received the notice provided for in this Section at
least two Business Days prior to the date upon which by the terms hereof any
monies may become payable for any purpose (including, the payment of the
principal of (and premium, if any, on) or interest (including any Additional
Interest) on any Security), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive such
monies and to apply the same to the purpose for which they were received and
shall not be affected by any notice to the contrary that may be received by it
within two Business Days prior to such date.
Subject to the provisions of Section 6.1, the Trustee shall be entitled
to rely on the delivery to it of a written notice by a Person representing
himself or herself to be a holder of Senior Indebtedness (or a trustee or
attorney-in-fact therefor) to establish that such notice has been given by a
holder of Senior Indebtedness (or a trustee or attorney-in-fact 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
Indebtedness 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 Indebtedness
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 any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
Section 13.9. Reliance on Judicial Order or Certificate of Liquidating
Agent.
Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee, subject to the provisions of Section 6.1, and the
Holders of the Securities shall be entitled to conclusively rely upon any order
or decree entered by any court of competent jurisdiction in which such
Proceeding is pending, or a certificate of the trustee in bankruptcy, receiver,
conservator,liquidating trustee, custodian, assignee for the benefit of
creditors, 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 payment or distribution, the holders
of the Senior Indebtedness 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 13.10. Trustee Not Fiduciary for Holders of Senior
Indebtedness.
The Trustee, in its capacity as trustee under this Indenture, shall not
be deemed to owe any fiduciary duty to the holders of Senior Indebtedness and
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 Indebtedness
shall be entitled by virtue of this Article or otherwise.
Section 13.11. Rights of Trustee as Holder of Senior Indebtedness;
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 Indebtedness that
may at any time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.
Section 13.12. 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.
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.
Attest:_____________________ EQUITABLE RESOURCES, INC.
A. C. Moeller
Vice President and
Corporate Secretary
By:__________________________________________
Name: Jeffrey C. Swoveland
Title: Vice President - Finance and Treasurer
Attest:_____________________ BANKERS TRUST COMPANY, as Trustee,
and not in its individual capacity
By:__________________________________________
Name:
Title:
AMENDED AND RESTATED TRUST AGREEMENT
among
EQUITABLE RESOURCES, INC., as Depositor,
BANKERS TRUST COMPANY, as Property Trustee,
BANKERS TRUST (DELAWARE), as Delaware Trustee
the Administrators named herein
and
the several Holders
(as defined herein)
Dated as of April 23, 1998
<PAGE>
EQUITABLE RESOURCES CAPITAL TRUST I
Certain Sections of this Trust Agreement relating
to Sections 310 through 318 of the Trust Indenture
Act of 1939:
Trust Indenture Trust Agreement Act Section
Section
310(a)(1) 8.7........................................................... 8.7
(a)(2).................................................................. 8.7
(a)(3).................................................................. 8.9
(a)(4)............................................................... 2.7(a)(ii)
(b)............................................................... 8.8, 10.10(b)
311(a)........................................................... 8.13, 10.10(b)
(b).............................................................. 8.13, 10.10(b)
312(a)................................................................. 10.10(b)
(b)............................................................... 10.10(b), (f)
(c)........................................................................ 5.7
313(a).................................................................. 8.15(a)
(a)(4)................................................................. 10.10(c)
(b).......................................................... 8.15(c), 10.10(c)
(c).............................................................. 10.8, 10.10(c)
(d).................................................................... 10.10(c)
314(a)........................................................... 8.16, 10.10(d)
(b)............................................................. Not Applicable
(c)(1)...................................................... 8.17, 10.10(d), (e)
(c)(2)...................................................... 8.17, 10.10(d), (e)
(c)(3)..................................................... 8.17, 10.10(d), (e)
(e).............................................................. 8.17, 10.10(e)
315(a)................................................................... 8.1(d)
(b)........................................................................ 8.2
(c)..................................................................... 8.1(c)
(d)...................................................................... 8.1(d)
(e)............................................................. Not Applicable
316(a).......................................................... Not Applicable
(a)(1)(A)....................................................... Not Applicable
(a)(1)(B)....................................................... Not Applicable
(a)(2) ......................................................... Not Applicable
(b)........................................................................ 5.13
(c)......................................................................... 6.7
317(a)(1)....................................................... Not Applicable
(a)(2) ................................................................. 8.14
(b) ................................................................... 5.10
318(a)................................................................. 10.10(a)
Note: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Trust
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINED TERMS
SECTION 1.1. Definitions 1
ARTICLE II
CONTINUATION OF THE ISSUER TRUST
SECTION 2.1. Name 9
SECTION 2.2. Office of the Delaware Trustee; Principal Place of Business 9
SECTION 2.3. Initial Contribution of Trust Property; Organizational Expenses 9
SECTION 2.4. Issuance of the Capital Securities 9
SECTION 2.5. Issuance of the Common Securities; Subscription and Purchase
of Junior Subordinated Debentures 10
SECTION 2.6. Declaration of Trust 10
SECTION 2.7. Authorization to Enter into Certain Transactions 10
SECTION 2.8. Assets of Trust 13
SECTION 2.9. Title to Trust Property 13
ARTICLE III
PAYMENT ACCOUNT
SECTION 3.1. Payment Account 13
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
SECTION 4.1. Distributions 13
SECTION 4.2. Redemption 14
SECTION 4.3. Subordination of Common Securities 16
SECTION 4.4. Payment Procedures 17
SECTION 4.5. Tax Returns and Reports 17
SECTION 4.6. Payment of Taxes, Duties, Etc. of the Issuer Trust 17
SECTION 4.7. Payments under Indenture or Pursuant to Direct Actions 17
SECTION 4.8. Liability of the Holder of Common Securities 18
ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 5.1. Initial Ownership 18
SECTION 5.2. The Trust Securities Certificates 18
SECTION 5.3. Execution and Delivery of Trust Securities Certificates 18
SECTION 5.4. Global Capital Security 19
SECTION 5.5. Registration of Transfer and Exchange Generally;
Certain Transfers and Exchanges; Capital Securities
Certificates 20
SECTION 5.6. Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates 21
SECTION 5.7. Persons Deemed Holders 21
SECTION 5.8. Access to List of Holders' Names and Addresses 21
SECTION 5.9. Maintenance of Office or Agency 21
SECTION 5.10.Appointment of Paying Agent. 22
SECTION 5.11.Ownership of Common Securities by Depositor. 22
SECTION 5.12.Notices to Clearing Agency. 22
SECTION 5.13.Rights of Holders 22
ARTICLE VI
ACTS OF HOLDERS; MEETINGS; VOTING
SECTION 6.1. Limitations on Holder's Voting Rights 24
SECTION 6.2. Notice of Meetings 25
SECTION 6.3. Meetings of Holders 25
SECTION 6.4. Voting Rights 25
SECTION 6.5. Proxies, etc. 25
SECTION 6.6. Holder Action by Written Consent. 26
SECTION 6.7. Record Date for Voting and Other Purposes 26
SECTION 6.8. Acts of Holders 26
SECTION 6.9. Inspection of Records 27
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. Representations and Warranties of the Property Trustee
and the Delaware Trustee 27
SECTION 7.2. Representations and Warranties of Depositor 28
ARTICLE VIII
THE ISSUER TRUSTEES; THE ADMINISTRATORS
SECTION 8.1. Certain Duties and Responsibilities 28
SECTION 8.2. Certain Notices 30
SECTION 8.3. Certain Rights of Property Trustee 30
SECTION 8.4. Not Responsible for Recitals or Issuance of Securities 32
SECTION 8.5. May Hold Securities 32
SECTION 8.6. Compensation; Indemnity; Fees 32
SECTION 8.7. Corporate Property Trustee Required; Eligibility
of Trustees and Administrators 33
SECTION 8.8. Conflicting Interests 34
SECTION 8.9. Co-Trustees and Separate Trustee 34
SECTION 8.10. Resignation and Removal; Appointment of Successor 35
SECTION 8.11. Acceptance of Appointment by Successor 36
SECTION 8.12. Merger, Conversion, Consolidation or Succession to Business 36
SECTION 8.13. Preferential Collection of Claims Against Depositor or
Issuer Trust 36
SECTION 8.14. Trustee May File Proofs of Claim 36
SECTION 8.15. Reports by Property Trustee 37
SECTION 8.16. Reports to the Property Trustee 37
SECTION 8.17. Evidence of Compliance with Conditions Precedent 38
SECTION 8.18. Number of Issuer Trustees 38
SECTION 8.19. Delegation of Power 38
SECTION 8.20. Appointment of Administrators 38
ARTICLE IX
DISSOLUTION, LIQUIDATION AND MERGER
SECTION 9.1. Dissolution Upon Expiration Date 39
SECTION 9.2. Early Termination 39
SECTION 9.3. Termination 39
SECTION 9.4. Liquidation 40
SECTION 9.5. Mergers, Consolidations, Amalgamations or
Replacements of the Issuer Trust 41
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Limitation of Rights of Holders 41
SECTION 10.2. Amendment 42
SECTION 10.3. Separability 43
SECTION 10.4. Governing Law 43
SECTION 10.5. Payments Due on Non-Business Day 43
SECTION 10.6. Successors 44
SECTION 10.7. Headings 44
SECTION 10.8. Reports, Notices and Demands 44
SECTION 10.9. Agreement Not to Petition 44
SECTION 10.10. Trust Indenture Act; Conflict with Trust Indenture Act 45
SECTION 10.11. Acceptance of Terms of Trust Agreement, Guarantee and
Indenture 46
SECTION 10.12. Counterparts 47
Exhibit A Certificate of Trust
Exhibit B Form of Letter of Representations
Exhibit C Form of Common Securities Certificate
Exhibit D Form of Capital Securities Certificate
Exhibit E Form of Expense Agreement
<PAGE>
Amended and Restated Trust Agreement, dated as of April 23, 1998, among
(i) Equitable Resources, Inc., a Pennsylvania corporation (including any
successors or assigns, the "Depositor"), (ii) Bankers Trust Company, a New York
banking corporation, as property trustee, (in such capacity, the "Property
Trustee" and, in its separate corporate capacity and not in its capacity as
Property Trustee, the "Bank"), (iii) Bankers Trust (Delaware), a Delaware
banking corporation, as Delaware trustee (the "Delaware Trustee") (the Property
Trustee and the Delaware Trustee are referred to collectively herein as
the"Issuer Trustees"), (iv) two individuals selected by the holders of the
Common Securities (as defined herein) to act as administrators with respect to
the Issuer Trust (the "Administrators") and (v) the several Holders, as
hereinafter defined.
W I T N E S S E T H:
WHEREAS, the Issuer Trust (as defined herein) has been established
under the Delaware Business Trust Act pursuant to a certain Trust Agreement,
dated as of January 7, 1998 (the "Original Trust Agreement"), and by the filing
of the Certificate of Trust of the Issuer Trust with the Secretary of State of
the State of Delaware on January 7, 1998 (the "Certificate of Trust"), which
Certificate of Trust is attached as Exhibit A; and
WHEREAS, the Depositor, the Property Trustee and the Delaware Trustee
desire to amend and restate the Original Trust Agreement in its entirety as set
forth herein to provide for, among other things, (i) the issuance of the Common
Securities by the Issuer Trust to the Depositor, (ii) the issuance and sale of
the Capital Securities by the Issuer Trust pursuant to the Underwriting
Agreement, (iii) the acquisition by the Issuer Trust from the Depositor of all
of the right, title and interest in the Junior Subordinated Debentures, and (iv)
the appointment of the Administrators.
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are 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, intending to be legally
bound, as follows:
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) The words "include," "includes" and "including" shall be deemed to be
followed by the phrase "without limitation";
(d) All accounting terms used but not defined herein have the meanings
assigned to them in accordance with United States generally accepted accounting
principles as in effect at the time
of computation;
(e) 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
(f) 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 Additional Interest (as
defined in the Indenture) paid by the Depositor on a Like Amount of Debentures
for such period.
"Additional Sums" has the meaning specified in Section 10.6 of the
Indenture.
"Administrators" means each Person appointed in accordance with Section
8.20 solely in such Person's capacity as Administrator of the Issuer Trust and
not in such Person's individual capacity, or any successor Administrator
appointed as herein provided; with the initial Administrators being Jeffrey C.
Swoveland and Philip P. Conti.
"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.
"Applicable Procedures" means, with respect to any transfer or transaction
involving a Global Capital Security or beneficial interest therein, the rules
and procedures of the Depositary for such Capital Security, in each case to the
extent applicable to such transaction and as in effect from time to
time.
"Bank" has the meaning specified in the preamble to this Trust Agreement.
"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.
"Board of Directors" means the board of directors of the Depositor or the
Executive Committee of the board of directors of the Depositor (or any other
committee of the board of directors of the Depositor performing similar
functions) or a committee designated by the board of directors of the Depositor
(or any such committee), comprised of two or more members of the board of
directors of the Depositor or officers of the Depositor, or both.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Depositor to have been duly adopted by the
Depositor's Board of Directors, or such committee of the Board of Directors or
officers of the Depositor to which authority to act on behalf of the Board of
Directors has been delegated, and to be in full force and effect on the date of
such certification, and delivered to the Issuer Trustees.
"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 or in the City of
Pittsburgh, Pennsylvania 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 Delaware Trustee's corporate trust office or the corporate trust
office of the Debenture Trustee is closed for business.
"Capital Securities Certificate" means a certificate evidencing ownership
of Capital Securities, substantially in the form attached as Exhibit
D.
"Capital Security" means a preferred undivided beneficial interest in the
assets of the Issuer Trust, having a Liquidation Amount of $25 and having the
rights provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Certificate Depositary Agreement" means the agreement among the Issuer
Trust, the Depositor and the Depositary, as the initial Clearing Agency, dated
as of the Closing Date, substantially in the form attached as Exhibit B, as the
same may be amended and supplemented from time to time.
"Certificate of Trust" has the meaning specified in the preamble to this
Trust Agreement.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act. The Depositary shall 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.
"Closing Date" has the meaning specified in the Underwriting Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Securities Certificate" means a certificate evidencing ownership of
Common Securities, substantially in the form attached as Exhibit C.
"Common Securities Purchase Agreement" means the common securities
subscription agreement between the Issuer Trust and the Depositor dated April
23, 1998.
"Common Security" means an undivided beneficial interest in the assets of
the Issuer Trust, having a Liquidation Amount of $25 and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Corporate Trust Office" means the principal office of the Property Trustee
located in the City of New York which at the time of the execution of this Trust
Agreement is located at Four Albany Street, New York, New York 10006; Attention:
Corporate Trust and Agency Group.
"Debenture Event of Default" means an "Event of Default" as defined in the
Indenture.
"Debenture Redemption Date" means, with respect to any Junior Subordinated
Debentures to be redeemed under the Indenture, the date fixed for
redemption of such Junior Subordinated Debentures under the Indenture.
"Debenture Trustee" means Bankers Trust Company, a New York banking
corporation, as Trustee under the Indenture, and any successor.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. ss.3801, et seq., as it may be amended from time to time.
"Delaware Trustee" means the corporation identified as the "Delaware
Trustee" in the preamble to this Trust Agreement solely in its capacity as
Delaware Trustee of the Issuer Trust 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.
"Depositary" means The Depository Trust Company or any successor thereto.
"Direct Action" has the meaning specified in Section 5.13.
"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 a Debenture Event of Default; or
(b) default by the Issuer Trust or 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 Issuer Trust or 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 Issuer Trustees in this Trust Agreement (other than
a covenant or warranty a default in the performance of which or the 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 Issuer Trustees and the Depositor by the Holders of at
least 25% in aggregate Liquidation Amount of the Outstanding Capital 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 any Bankruptcy Event with respect to the Property
Trustee or all or substantially all of its property if a successor Property
Trustee has not been appointed within a period of 90 days thereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and any successor statute thereto, in each case as amended from time to
time.
"Expense Agreement" means the Agreement as to Expenses and Liabilities,
dated as of the Closing Date, between the Depositor, in its capacity as holder
of the Common Securities, and the Issuer Trust, substantially in the form
attached as Exhibit E, as amended from time to time.
"Expiration Date" has the meaning specified in Section 9.1.
"Global Capital Securities Certificate" means a Capital Securities
Certificate evidencing ownership of Global Capital Securities.
"Global Capital Security" means a Capital Security, the ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 5.4.
"Guarantee Agreement" means the Guarantee Agreement executed and delivered
by the Depositor and Bankers Trust Company, as trustee, contemporaneously with
the execution and delivery of this Trust Agreement, for the benefit of the
holders of the Capital Securities, as amended from time to
time.
"Holder" means a Person in whose name a Trust Security or Trust Securities
is registered in the Securities Register; any such Person shall be a beneficial
owner within the meaning of the Delaware Business Trust Act.
"Indenture" means the Junior Subordinated Indenture, dated as of April 23,
1998, between the Depositor and the Debenture Trustee (as amended or
supplemented from time to time) relating to the issuance of the Junior
Subordinated Debentures.
"Investment Company Act" means the Investment Company Act of 1940, as
amended.
"Investment Company Event" means the receipt by the Issuer Trust of an
Opinion of Counsel experienced in such matters, to the effect that, as a result
of the occurrence of a change in law or regulation or a written change
(including any announced prospective change) in interpretation or application of
law or regulation by any legislative body, court, governmental agency or
regulatory authority, there is more than an insubstantial risk that the Issuer
Trust is or will be considered an "investment company" that is required to be
registered under the Investment Company Act, which change or prospective change
becomes effective or would become effective, as the case may be, on or after the
date of the issuance of the Capital Securities.
"Issuer Trust" means Equitable Resources Capital Trust I.
"Issuer Trustees" means, collectively, the Property Trustee and the
Delaware Trustee.
"Junior Subordinated Debentures" means the aggregate principal amount
of the Depositor's 7.35% Junior Subordinated Deferrable Interest Debentures,
issued pursuant to the Indenture.
"Junior Subordinated Debenture Purchase Agreement" means the junior
subordinated debenture subscription agreement between the Issuer Trust and the
Depositor dated April 23, 1998.
"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 Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Indenture, allocated to the
Common Securities and to the Capital Securities based upon the relative
Liquidation Amounts of such classes and (b) with respect to a distribution of
Junior Subordinated Debentures to Holders of Trust Securities in connection with
a dissolution or liquidation of the Issuer Trust, Junior Subordinated Debentures
having a principal amount equal to the Liquidation Amount of the Trust
Securities of the Holder to whom such Junior Subordinated Debentures are
distributed.
"Liquidation Amount" means the stated amount of $25 per Trust Security.
"Liquidation Date" means the date on which Junior Subordinated
Debentures are to be distributed to Holders of Trust Securities in connection
with a dissolution and liquidation of the Issuer Trust pursuant to Section 9.4.
"Liquidation Distribution" has the meaning specified in Section 9.4(d).
"Majority in Liquidation Amount of the Capital Securities" or "Majority
in Liquidation Amount of the Common Securities" means, except as provided by the
Trust Indenture Act, Capital Securities or Common Securities, as the case may
be, representing more than 50% of the aggregate Liquidation Amount of all then
Outstanding Capital Securities or Common Securities, as the case may be.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board and Chief Executive Officer, President or a Senior Vice President or
Vice President, and by the Treasurer, an Assistant Treasurer, the Secretary or
an Assistant Secretary, of the Depositor, and delivered to the party provided
herein. Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Trust Agreement shall include:
(a) a statement by each officer signing the Officers' Certificate that such
officer 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 such officer in rendering the Officers' Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may, unless
otherwise specified herein, be counsel for or an officer or employee of the
Depositor or any Affiliate of the Depositor.
"Original Trust Agreement" has the meaning specified in the preamble to
this Trust Agreement.
"Outstanding," 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
(c) Trust Securities which have been paid or in exchange for or in lieu of
which other Trust Securities have been executed and delivered pursuant to
Sections 5.4, 5.5, 5.6 and 5.13; provided, however, that in determining whether
the Holders of the requisite Liquidation Amount of the Outstanding Capital
Securities have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, Capital Securities owned by the Depositor, or any
Issuer Trustee, any Administrator or any Affiliate of the Depositor or any
Issuer Trustee shall be disregarded and deemed not to be Outstanding, except
that (a) in determining whether any Issuer Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Capital Securities that such Issuer Trustee or such Administrator,
as the case may be, actually knows to be so owned shall be so disregarded and
(b) the foregoing shall not apply at any time when all of the outstanding
Capital Securities are owned by the Depositor, one or more of the Issuer
Trustees, one or more of the Administrators and/or any such Affiliate. Capital
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Administrators
the pledgee's right so to act with respect to such Capital 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 Global Capital
Securities 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 5.10 and shall initially be the Property Trustee.
"Payment Account" means a segregated non-interest-bearing corporate
trust account maintained with the Property Trustee in its trust department for
the benefit of the Holders in which all amounts paid in respect of the Junior
Subordinated Debentures 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 a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, company,
limited liability company, trust, unincorporated organization or government or
any agency or political subdivision thereof, or any other entity of whatever
nature.
"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 Issuer Trust and not in its individual capacity, or its
successor in interest in such capacity, or any successor property trustee
appointed as herein provided.
"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 Debenture Redemption Date and the stated maturity
of the Junior Subordinated Debentures shall be a Redemption Date for a Like
Amount of Trust Securities, including but not limited to any date of redemption
pursuant to the occurrence of any Special Event.
"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
Junior Subordinated Debentures.
"Relevant Trustee" has the meaning specified in Section 8.10.
"Responsible Officer" when used with respect to the Property Trustee
means any officer assigned to the Corporate Trust Office, including any managing
director, vice president, assistant vice president, assistant treasurer,
assistant secretary or any other officer of the Property Trustee customarily
performing functions similar to those performed by any of the above designated
officers and having direct responsibility for the administration of this Trust
Agreement, and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"Securities Act" means the Securities Act of 1933, as amended, and any
successor statute thereto, in each case as amended from time to time.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.5.
"Senior Indebtedness" has the meaning specified in the Indenture.
"Special Event" means any Tax Event or Investment Company Event.
"Tax Event" means the receipt by the Issuer Trust of an Opinion of
Counsel experienced in such matters, to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement, action or decision is announced on or after
the date of issuance of the Capital Securities, there is more than an
insubstantial risk that (i) the Issuer Trust is, or will be within 90 days of
the delivery of such Opinion of Counsel, subject to United States Federal income
tax with respect to income received or accrued on the Junior Subordinated
Debentures, (ii) interest payable by the Depositor on the Junior Subordinated
Debentures is not, or within 90 days of the delivery of such Opinion of Counsel
will not be, deductible by the Depositor, in whole or in part, for United States
federal income tax purposes, or (iii) the Issuer Trust is, or will be within 90
days of the delivery of such Opinion of Counsel, subject to more than a de
minimis amount of other taxes, duties or other governmental charges.
"Trust Agreement" means this Amended and Restated 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 Amended and Restated Trust Agreement any such modification,
amendment or supplement, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern this Amended and Restated Trust Agreement and
any modification, amendment or supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 or any
successor statute, in each case as amended from time to time.
"Trust Property" means (a) the Junior Subordinated Debentures, (b) any
cash on deposit in, or owing to, the Payment Account, and (c) all proceeds and
rights in respect of the foregoing or 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 Securities Certificate" means any one of the Common Securities
Certificates or the Capital Securities Certificates.
"Trust Security" means any one of the Common Securities or the Capital
Securities.
"Underwriters" has the meaning specified in the Underwriting Agreement.
"Underwriting Agreement" means the Underwriting Agreement, dated as of
April 16, 1998, among the Issuer Trust, the Depositor and the Underwriters, as
the same may be amended from time to time.
ARTICLE II.
CONTINUATION OF THE ISSUER TRUST
Section 2.1. Name. The Issuer Trust continued hereby shall be known as
"Equitable Resources Capital Trust I", as such name may be modified from time to
time by the Administrators following written notice to the Holders of Trust
Securities and the Issuer Trustees, in which name the Administrators and the
Issuer Trustees may engage in the transactions contemplated hereby, make and
execute contracts and other instruments on behalf of the Issuer 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 Bankers
Trust (Delaware), E.A. Delle Donne Corporate Center, Montgomery Building, 1011
Centre Road, Suite 200, Wilmington, DE 19805, Attention: Lisa Wilkins, or such
other address in the State of Delaware as the Delaware Trustee may designate by
written notice to the Holders and the Depositor. The principal executive office
of the Issuer Trust is in care of Equitable Resources, Inc., 420 Boulevard of
the Allies, Pittsburgh, Pennsylvania 15219, Attention: Office of the Secretary.
Section 2.3 Initial Contribution of Trust Property; Organizational Expenses
The Property Trustee acknowledges receipt in trust from the Depositor in
connection with this Trust Agreement of the sum of $10, which constitutes the
initial Trust Property. The Depositor shall pay all organizational expenses of
the Issuer Trust as they arise or shall, upon request of any Issuer Trustee,
promptly reimburse such Issuer Trustee for any such expenses paid by such Issuer
Trustee. The Depositor shall make no claim upon the Trust Property for the
payment of such expenses.
Section 2.4 Issuance of the Capital Securities
The Depositor, both on its own behalf and on behalf of the Issuer Trust
pursuant to the Original Trust Agreement, executed and delivered the
Underwriting Agreement. Contemporaneously with the execution and delivery of
this Trust Agreement, an Administrator, on behalf of the Issuer Trust, shall
execute, manually or by facsimile, in accordance with Section 5.3 and the
Property Trustee shall authenticate in accordance with Section 5.3 and deliver
to the Underwriters, Capital Securities Certificates, registered in the names
requested by the Underwriters, in an aggregate amount of 5,000,000 Capital
Securities having an aggregate Liquidation Amount of $125,000,000, against
receipt of the aggregate purchase price of such Capital Securities of
$125,000,000, by the Property Trustee.
Section 2.5. Issuance of the Common Securities; Subscription and Purchase
of Junior Subordinated Debentures
Contemporaneously with the execution and delivery of this Trust
Agreement, an Administrator, on behalf of the Issuer Trust, shall execute or
cause to be executed 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 154,640 Common Securities having an aggregate Liquidation
Amount of $3,866,000 against receipt of the aggregate purchase price of such
Common Securities of $3,866,000 by the Property Trustee. Contemporaneously
therewith, an Administrator, on behalf of the Issuer Trust, shall subscribe for
and purchase from the Depositor, Junior Subordinated Debentures, registered in
the name of the Issuer Trust and having an aggregate principal amount equal to
$128,866,000 and, in satisfaction of the purchase price for such Junior
Subordinated Debentures, the Property Trustee, on behalf of the Issuer Trust,
shall deliver to the Depositor the sum of $128,866,000 (being the sum of the
amounts delivered to the Property Trustee pursuant to (i) the second sentence of
Section 2.4, and (ii) the first sentence of this Section 2.5) and receive on
behalf of the Issuer Trust such Junior Subordinated Debentures.
Section 2.6. Declaration of Trust
The exclusive purposes and functions of the Issuer Trust are to (a)
issue and sell Trust Securities and use the proceeds from such sale to acquire
the Junior Subordinated Debentures, and (b) engage in only those other
activities necessary, convenient or incidental thereto. The Depositor hereby
appoints the Issuer Trustees as trustees of the Issuer Trust, to have all the
rights, powers and duties to the extent set forth herein, and the Issuer
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 Issuer Trust and the Holders. The
Depositor hereby appoints the Administrators, with such Administrators having
all rights, powers and duties set forth herein with respect to accomplishing the
purposes of the Issuer Trust, and the Administrators hereby accept such
appointment, provided, however, that it is the intent of the parties hereto that
such Administrators shall not be trustees or, to the fullest extent permitted by
law, fiduciaries with respect to the Issuer Trust and this Trust Agreement shall
be construed in a manner consistent with such intent. The Property Trustee shall
have the right and power to perform those duties assigned to the Administrators.
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 Administrators set forth herein. The Delaware Trustee shall be
one of the trustees of the Issuer Trust for the sole and limited purpose of
fulfilling the requirements of Section 3807 of the Delaware Business Trust Act
and for taking such actions as are required to be taken by a Delaware trustee
under the Delaware Business Trust Act.
Section 2.7 Authorization to Enter into Certain Transactions
(a) The Issuer Trustees and the Administrators shall conduct the affairs of
the Issuer 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) , (ii) and (iii), the Issuer Trustees and the
Administrators shall act as follows:
(i) Each Administrator, acting singly or jointly, is authorized,
on behalf of the Trust, to:
(A) comply with the Underwriting Agreement
regarding the issuance and sale of the Capital Securities;
(B) assist in compliance with the Securities Act,
applicable state securities or blue sky laws, and the Trust
Indenture Act;
(C) assist in the listing of the Capital Securities
upon such securities exchange or exchanges as shall be
determined by the Depositor, with the registration of the
Capital Securities under the Exchange Act, if required, and
the preparation and filing of all periodic and other reports
and other documents pursuant to the foregoing;
(D) execute the Trust Securities on behalf of the
Issuer Trust in accordance with this Trust Agreement;
(E) execute and deliver an application for a taxpayer
identification number for the Issuer Trust;
(F) execute on behalf of the Issuer Trust any
documents that the Administrators have the power to execute
pursuant to this Trust Agreement, including without limitation
a Junior Subordinated Debenture Purchase Agreement, a Common
Securities Purchase Agreement and a Letter of Representations;
and
(G) take any action incidental to the foregoing as
necessary or advisable to give effect to the terms of this
Trust Agreement (and any actions taken in furtherance of the
above prior to the date of this Trust Agreement by the
Administrators are hereby ratified and confirmed in all
respects).
(ii) The Property Trustee shall have the power and authority to
act on behalf of the Issuer Trust with respect to the following matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Junior Subordinated
Debentures;
(C) the receipt and collection of interest, principal
and any other payments made in respect of the Junior
Subordinated Debentures in the Payment Account;
(D) the distribution 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 Junior Subordinated Debentures;
(F) the sending of notices of default and other
information regarding the Trust Securities and the Junior
Subordinated Debentures 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 Issuer
Trust and the execution of the certificate of cancellation
with the Secretary of State of the State of Delaware; and
(I) after an Event of Default (other than under the
definition of such term if such Event of Default is by or with
respect to the Property Trustee), compliance with the
provisions of this Trust Agreement and the taking of any
action 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);
provided, however, that nothing in this Section 2.7(a)(ii) shall require the
Property Trustee to take any action that is not otherwise required in this Trust
Agreement.
(b) So long as this Trust Agreement remains in effect, the Issuer Trust (or
the Issuer Trustees or Administrators acting on behalf of the Issuer Trust)
shall not undertake any business, activities or transaction except as expressly
provided herein or contemplated hereby. In particular, neither the Issuer
Trustees nor the Administrators shall (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 reasonably be expected to
cause the Issuer Trust to become taxable as a corporation for United States
Federal income tax purposes, (iv) incur any indebtedness for borrowed money or
issue any other debt, or (v) take or consent to any action that would result in
the placement of a Lien on any of the Trust Property. The Property Trustee 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 Issuer Trust or the
Holders in their capacity as Holders.
(c) In connection with the issue and sale of the Capital Securities, the
Depositor shall have the right and responsibility to assist the Issuer Trust
with respect to, or effect on behalf of the Issuer 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 Issuer Trust, and execution
on behalf of the Issuer Trust, of a registration statement, and a prospectus in
relation to the Capital Securities, including any amendments thereto and the
taking of any action necessary or desirable to sell the Capital Securities
in a transaction or a series of transactions not exempt from the
registration requirements of the Securities Act;
(ii) the determination of the States in which to take
appropriate action to qualify or register for sale all or part of the Capital
Securities and the determination of any and all such acts, other than actions
that must betaken by or on behalf of the Issuer Trust, and the advice to the
Issuer Trustees of actions they must take on behalf of the Issuer Trust, and
the preparation for execution and filing of any documents to be executed
and filed by the Issuer Trust or on behalf of the Issuer Trust, as the
Depositor deems necessary or advisable in order to comply with the
applicable laws of any such States in connection with the sale of the Capital
Securities;
(iii) the negotiation of the terms of, and the execution and
delivery of, the Underwriting Agreement providing for the sale of the Capital
Securities;
(iv) compliance with the listing requirements of the Capital
Securities upon such securities exchange or exchanges as shall be determined by
the Depositor, the registration of the Capital Securities under the Exchange
Act, if required, and the preparation and filing of all periodic and other
reports and other documents pursuant to the foregoing; and
(v) 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 Administrators and
the Property Trustee are authorized and directed to conduct the affairs of the
Issuer Trust and to operate the Issuer Trust so that the Issuer Trust will not
be deemed to be an "investment company" required to be registered under the
Investment Company Act, and will not be taxable as a corporation for the United
States Federal income tax purposes and so that the Junior Subordinated
Debentures will be treated as indebtedness of the Depositor for United States
Federal income tax purposes. In this connection, the Property Trustee and the
Holders of Common Securities are authorized to take any action, not inconsistent
with applicable law, the Certificate of Trust or this Trust Agreement, that the
Property Trustee and Holders of Common Securities determine in their 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
Outstanding Capital Securities. In no event shall the Administrators or the
Issuer Trustees be liable to the Issuer Trust or the Holders for any failure to
comply with this section that results from a change in law or regulations or in
the interpretation thereof.
Section 2.8. Assets of Trust
The assets of the Issuer Trust shall consist solely 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 Issuer 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 its agents 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.
(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 Junior Subordinated Debentures.
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 Additional Interest, as defined in the Indenture) are made on the
Junior Subordinated Debentures. Accordingly:
(i) Distributions on the Trust Securities shall be cumulative
and will accumulate whether or not there are funds of the Issuer Trust
available for the payment of Distributions. Distributions shall accumulate
from April 23, 1998,
and, except in the event (and to the extent) that the Depositor exercises its
right to defer the payment of interest on the Debentures pursuant to the
Indenture, shall be payable quarterly in arrears on January 15, April 15, July
15 and October 15 of each year, commencing on July 15, 1998. 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 (without any interest or other payment in
respect of any such delay), except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the date on which such payment was originally payable (each date on which
distributions are payable in accordance with this Section 4.1(a), a
"Distribution Date").
(ii) The Trust Securities shall be entitled to Distributions
payable at a rate
of 7.35% per annum of the Liquidation Amount of the Trust Securities. The amount
of Distributions payable for any period less than a full Distribution period
shall be computed on the basis of a 360-day year of twelve 30-day months and the
actual number of days elapsed in a partial month in a period. Distributions
payable for each full Distribution period will be computed by dividing the rate
per annum by four (4). The amount of Distributions payable for any period shall
include any Additional Amounts in respect of such period.
(iii) So long as no Debenture Event of Default has occurred and
is continuing,
the Depositor has the right under the Indenture to defer the payment of interest
on the Junior Subordinated Debentures at any time and from time to time for a
period not exceeding 20 consecutive quarterly periods (an "Extension Period"),
provided that no Extension Period may extend beyond the stated maturity of the
Junior Subordinated Debentures (as such stated maturity may be advanced in
accordance with the terms of the Indenture). As a consequence of any such
deferral, quarterly Distributions on the Trust Securities by the Issuer Trust
will also be deferred to the extent and except as provided in the Junior
Subordinated Debentures (and the amount of Distributions to which Holders of the
Trust Securities are entitled that have been so deferred will accumulate
additional Distributions thereon at the rate per annum of 7.35% per annum,
compounded quarterly) from the most recent Distribution payment date on which
Distributions were paid, computed on the basis of a 360-day year of twelve
30-day months and the actual days elapsed in a partial month in such period.
Additional Distributions payable for each full Distribution period will be
computed by dividing the rate per annum by four (4). The term "Distributions" as
used in Section 4.1 shall include any such additional Distributions provided
pursuant to this Section 4.1(a)(iii).
(iv) Distributions on the Trust
Securities shall be made by the Property Trustee from the Payment Account and
shall be payable on each Distribution Date only to the extent that the Issuer
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 at the close of business on the 1st day of the month
next preceding the relevant Distribution Date, whether or not a Business Day.
Section 4.2 Redemption
(a) On each Junior Subordinated Debenture Redemption Date and on the stated
maturity of the Junior Subordinated Debentures, the Issuer 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, or as
soon as practicable thereafter, that notice of such actual Redemption Price is
received pursuant to the Indenture);
(iii) the CUSIP number or CUSIP numbers of the Capital Securities
affected;
(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 Trust Securities are to be
surrendered for the payment of the Redemption Price.
The Issuer Trust in issuing the Trust Securities shall use "CUSIP" numbers,
and the Property Trustee shall indicate the "CUSIP" numbers of the Trust
Securities in notices of redemption and related materials as a convenience to
Holders; provided that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Trust Securities
or as contained in any notice of redemption and related material.
(c) The Trust Securities redeemed on each Redemption Date shall be redeemed
at the Redemption Price with the applicable proceeds from the contemporaneous
redemption of Junior Subordinated Debentures. 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 Issuer 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
Capital 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
Capital Securities held in global form, irrevocably deposit with the Clearing
Agency for such Capital Securities, to the extent available therefor, 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 of the Capital Securities. With respect to Capital Securities that are
not held in global form, the Property Trustee, subject to Section 4.2(c), will
irrevocably deposit with the Paying Agent, to the extent available therefor,
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
Holder of the Capital Securities upon surrender of their Capital 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 in respect of the Trust Securities 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 applicable Redemption Price is payable is not a
Business Day, then payment of the applicable Redemption Price payable on such
date will be made on the next succeeding day that is a Business Day (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 the date such payment was originally payable. 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 Issuer
Trust or by the Depositor pursuant to the Guarantee Agreement, Distributions on
such Trust Securities will continue to accumulate, as set forth in Section 4.1,
from the Redemption Date originally established by the Issuer Trust for such
Trust Securities to the date such applicable Redemption Price is actually paid,
in which case the actual payment date will be the date fixed for redemption for
purposes of calculating the applicable Redemption Price.
(e) Subject to Section 4.3(a), if less than all the Outstanding Trust
Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of such Trust Securities to be redeemed shall be allocated
pro rata to the Common Securities and the Capital Securities based on the
relative Liquidation Amounts of such classes. The particular Capital Securities
to be redeemed shall be selected on a pro rata basis based on their respective
Liquidation Amounts not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Capital Securities not previously called
for redemption, or if the Capital Securities are then held in the form of a
Global Capital Security in accordance with the customary procedures for the
Clearing Agency. The Property Trustee shall promptly notify the Securities
Registrar in writing of the Capital Securities selected for redemption and, in
the case of any Capital Securities selected for partial redemption, the
Liquidation Amount thereof to be redeemed. For all purposes of this Trust
Agreement, unless the context otherwise requires, all provisions relating to the
redemption of Capital Securities shall relate, in the case of any Capital
Securities redeemed or to be redeemed only in part, to the portion of the
aggregate Liquidation Amount of Capital Securities that has been or is to be
redeemed.
Section 4.3. Subordination of Common Securities
(a) Payment of Distributions (including Additional Amounts, if applicable)
on, the Redemption Price of, and the Liquidation Distribution in respect of, the
Trust Securities, as applicable, shall be made, subject to Section 4.2(e), pro
rata among the Common Securities and the Capital Securities based on the
Liquidation Amount of such Trust Securities; provided, however, that if on any
Distribution Date or Redemption Date any Event of Default resulting from a
Debenture Event of Default in Section 5.1(1) or 5.1(2) of the Indenture shall
have occurred and be continuing, no payment of any Distribution (including any
Additional Amounts) on, Redemption Price of, or Liquidation Distribution in
respect 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 any Additional Amounts) on all Outstanding Capital 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 Capital Securities then called for redemption, or in the case of
payment of the Liquidation Distribution the full amount of such Liquidation
Distribution on all Outstanding Capital Securities, shall have been made or
provided for, and all funds immediately available to the Property Trustee shall
first be applied to the payment in full in cash of all Distributions (including
any Additional Amounts) on, the Redemption Price of, or the Liquidation
Distribution in respect of Capital Securities then due and payable. The
existence of an Event of Default does not entitle the Holders of Trust
Securities to accelerate the maturity thereof.
(b) In the case of the occurrence of any Event of Default resulting from
any Debenture Event of Default, the Holder of the Common Securities shall have
no right to act with respect to any such Event of Default under this Trust
Agreement until the effects of all such Events of Default with respect to the
Capital Securities have been cured, waived or otherwise eliminated. Until all
such Events of Default under this Trust Agreement with respect to the Capital
Securities have been so cured, waived or otherwise eliminated, the Property
Trustee shall act solely on behalf of the Holders of the Capital Securities and
not on behalf of the Holder of the Common Securities, and only the Holders of
the Capital Securities will have the right to direct the Property Trustee to act
on their behalf.
Section 4.4 Payment Procedures
Payments of Distributions (including any Additional Amounts) in respect of
the Capital Securities shall be made by check mailed to the address of the
Person entitled thereto as such address shall appear on the Securities Register
or, if the Capital Securities are held by a Clearing Agency, such Distributions
shall be made to the Clearing Agency in immediately available funds, which will
credit the relevant accounts on the applicable Distribution Dates. Payments of
Distributions to Holders of $1,000,000 or more in aggregate Liquidation Amount
of Capital Securities may be made by wire transfer of immediately available
funds upon written request of such Holder to the Securities Registrar not later
than 15 calendar days prior to the date on which the Distribution is payable.
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 4.5. Tax Returns and Reports
The Administrators shall prepare (or cause to be prepared), at the
Depositor's expense, and file all United States Federal, state and local tax and
information returns and reports required to be filed by or in respect of the
Issuer Trust. In this regard, the Administrators shall (a) prepare and file (or
cause to be prepared and filed) all Internal Revenue Service forms required to
be filed in respect of the Issuer Trust in each taxable year of the Issuer Trust
and (b) prepare and furnish (or cause to be prepared and furnished) to each
Holder all Internal Revenue Service forms required to be provided by the Issuer
Trust. The Administrators shall provide the Depositor and the Property Trustee
with a copy of all such returns and reports promptly after such filing or
furnishing. The Issuer 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.
On or before December 15 of each year during which any Capital
Securities are Outstanding, the Administrators shall furnish to the Property
Trustee such information as may be necessary 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 includible in income for each Outstanding Capital Security during
such year.
Section 4.6. Payment of Taxes, Duties, Etc. of the Issuer Trust
Upon receipt under the Junior Subordinated Debentures of Additional
Sums, the Property Trustee shall promptly pay, or cause the Administrators to
pay in connection with the filing of any tax returns or reports pursuant to
Section 4.5, any taxes, duties or governmental charges of whatsoever nature
(other than withholding taxes) imposed on the Issuer Trust by the United States
or any other taxing authority.
Section 4.7. Payments under Indenture or Pursuant to Direct Actions
Any amount payable hereunder to any Holder of Capital Securities shall
be reduced by the amount of any corresponding payment such Holder has directly
received pursuant to Section 5.8 of the Indenture or Section 5.13 of this Trust
Agreement.
Section 4.8. Liability of the Holder of Common Securities
The Holder of Common Securities shall be liable for the debts and
obligations of the Issuer Trust as set forth in Section 6.7 of the Indenture
regarding allocation of expenses.
ARTICLE V.
TRUST SECURITIES CERTIFICATES
Section 5.1 Initial Ownership
Upon the creation of the Issuer 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 Issuer Trust.
Section 5.2. The Trust Securities Certificates
(a) The Trust Securities Certificates shall be issued in multiples of $25
and shall be executed on behalf of the Issuer Trust by manual or facsimile
signature of at least one Administrator. 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 Issuer 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 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 5.5.
(b) Upon their original issuance, Capital Securities Certificates shall be
issued in the form of one or more fully registered Global Capital Securities
Certificates which will be deposited with or on behalf of the Depositary and
registered in the name of the Depositary's nominee. Unless and until it is
exchangeable in whole or in part for the Capital Securities in definitive form,
a global security may not be transferred except as a whole by the Depositary to
a nominee of the Depositary or by a nominee of the Depositary to the Depositary
or another nominee of the Depositary or by the Depositary or any such nominee to
a successor of such Depositary or a nominee of such successor.
(c) 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 5.3. Execution and Delivery of Trust Securities Certificates
At the Closing Date, at least one of the Administrators 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 Issuer Trust by manual or
facsimile signature. The Capital Securities so executed shall be delivered to
the Property Trustee and upon such delivery the Property Trustee shall manually
authenticate upon the written order of the Depositor such Capital Securities
Certificates and deliver such Capital Securities Certificates upon the written
order of the Depositor, executed by two authorized officers thereof, without
further corporate action by the Depositor, in authorized denominations.
Section 5.4. Global Capital Security
(a) Any Global Capital Security issued under this Trust Agreement shall be
registered in the name of the nominee of the Clearing Agency and delivered to
such custodian therefor, and such Global Capital Security shall constitute a
single Capital Security for all purposes of this Trust Agreement.
(b) Notwithstanding any other provision in this Trust Agreement, a Global
Capital Security may not be exchanged in whole or in part for Capital Securities
registered, and no transfer of the Global Capital Security in whole or in part
may be registered, in the name of any Person other than the Clearing Agency for
such Global Capital Security, or its nominee thereof unless (i) such Clearing
Agency advises the Property Trustee or the Depositor in writing that such
Clearing Agency is no longer willing or able to properly discharge its
responsibilities as Clearing Agency with respect to such Global Capital Security
or if it ceases to be a Clearing Agency under the Exchange Act, and the
Depositor is unable to locate a qualified successor within 90 days after
receiving such notice or becoming aware that the Depository is no longer so
registered, (ii) the Issuer Trust at its option advises the Depositary in
writing that it elects to terminate the book-entry system through the Clearing
Agency, or (iii) there shall have occurred and be continuing an Event of
Default.
(c) If a Capital Security is to be exchanged in whole or in part for a
beneficial interest in a Global Capital Security, then either (i) such Global
Capital Security shall be so surrendered for exchange or cancellation as
provided in this Article V or (ii) the aggregate Liquidation Amount thereof
shall be reduced or increased by an amount equal to the portion thereof to be so
exchanged or cancelled or equal to the Liquidation Amount of such other Capital
Security to be so exchanged for a beneficial interest therein, as the case may
be, by means of an appropriate adjustment made on the records of the Security
Registrar, whereupon the Property Trustee, in accordance with the Applicable
Procedures, shall instruct the Clearing Agency or its authorized representative
to make a corresponding adjustment to its records. Upon any such surrender or
adjustment of a Global Capital Security by the Clearing Agency, accompanied by
registration instructions, the Property Trustee shall, subject to Section 5.4(b)
and as otherwise provided in this Article V, authenticate and deliver any
Capital Securities issuable in exchange for such Global Capital Security (or any
portion thereof) in accordance with the instructions of the Clearing Agency. The
Property Trustee shall not be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be fully protected in
relying on, such instructions.
(d) Every Capital Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Capital Security or any
portion thereof, whether pursuant to this Article V or Article IV or otherwise,
shall be authenticated and delivered in the form of, and shall be, a Global
Capital Security, unless such Global Capital Security is registered in the name
of a Person other than the Clearing Agency for such Global Capital Security or a
nominee thereof.
(e) The Clearing Agency or its nominee, as the registered owner of a Global
Capital Security, shall be considered the Holder of the Capital Securities
represented by such Global Capital Security for all purposes under this Trust
Agreement and the Capital Securities, and owners of beneficial interests in such
Global Capital Security shall hold such interests pursuant to the Applicable
Procedures and, except as otherwise provided herein, shall not be entitled to
receive physical delivery of any such Capital Securities in definitive form and
shall not be considered the Holders thereof under this Trust Agreement.
Accordingly, any such owner's beneficial interest in the Global Capital Security
shall be shown only on, and the transfer of such interest shall be effected only
through, records maintained by the Clearing Agency or its nominee. Neither the
Property Trustee nor the Securities Registrar shall have any liability in
respect of any transfers effected by the Clearing Agency.
(f) The rights of owners of beneficial interests in a Global Capital
Security 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.
Section 5.5 Registration of Transfer and Exchange Generally; Certain
Transfers and Exchanges; Capital Securities Certifica.es
(a) The Property Trustee shall keep or cause to be kept at its Corporate
Trust Office a register or registers for the purpose of registering Capital
Securities Certificates and transfers and exchanges of Capital Securities
Certificates in which the registrar and transfer agent with respect to the
Capital Securities (the "Securities Registrar"), subject to such reasonable
regulations as it may prescribe, shall provide for the registration of Capital
Securities Certificates and Common Securities Certificates (subject to Section
5.11 in the case of Common Securities Certificates) and registration of
transfers and exchanges of Capital Securities Certificates as herein provided.
Such register is herein sometimes referred to as the "Securities Register." The
Property Trustee is hereby appointed "Securities Registrar" for the purpose of
registering Capital Securities and transfers of Capital Securities as herein
provided.
Upon surrender for registration of transfer of any Capital Security at
the offices or agencies of the Property Trustee designated for that purpose an
Administrator shall execute, and the Property Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Capital Securities of the same series of any authorized denominations of
like tenor and aggregate Liquidation Amount and bearing such legends as may be
required by this Trust Agreement.
At the option of the Holder, Capital Securities may be exchanged for
other Capital Securities of any authorized denominations, of like tenor and
aggregate Liquidation Amount and bearing such legends as may be required by this
Trust Agreement, upon surrender of the Capital Securities to be exchanged as
such office or agency. Whenever any securities are so surrendered for exchange,
an Administrator shall execute and the Property Trustee shall authenticate and
deliver the Capital Securities that the Holder making the exchange is entitled
to receive.
All Capital Securities issued upon any transfer or exchange of Capital
Securities shall be the valid obligations of the Issuer Trust, evidencing the
same debt, and entitled to the same benefits under this Trust Agreement, as the
Capital Securities surrendered upon such transfer or exchange.
Every Capital Security presented or surrendered for transfer or
exchange shall (if so required by the Property Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Property Trustee and the Securities Registrar, duly executed by the Holder
thereof or such Holder's attorney duly authorized in writing.
No service charge shall be made to a Holder for any transfer or
exchange of Capital Securities, but the Property Trustee may require payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Capital Securities.
Neither the Issuer Trust nor the Property Trustee shall be required,
pursuant to the provisions of this Section, (i) to issue, register the transfer
of or exchange any Capital Security during a period beginning at the opening of
business 15 days before the day of selection for redemption of Capital
Securities pursuant to Article IV and ending at the close of business on the day
of mailing of the notice of redemption, or (ii) to register the transfer of or
exchange any Capital Security so selected for redemption in whole or in part,
except, in the case of any such Capital Security to be redeemed in part, any
portion thereof not to be redeemed.
(b) Certain Transfers and Exchanges. Trust Securities may only be
transferred, in whole or in part, in accordance with the terms and conditions
set forth in this Trust Agreement. To the fullest extent permitted by law, any
transfer or purported transfer of any Trust Security not made in accordance with
this Trust Agreement shall be null and void.
(i) Non Global Security to Non Global Security. A Capital
Security that is not a Global Capital Security may be transferred, in whole
or in part, to a Person who takes delivery in the form of another Trust
Security that is not a Global Security as provided in Section 5.5(a).
(ii) Free Transferability. Subject to this Section 5.5, Capital
Securities shall be freely transferable.
(iii) Exchanges Between Global Capital Security and Non-Global
Capital Security. A beneficial interest in a Global Capital Security may be
exchanged for a Capital Security that is not a Global Capital Security a
providedin Section 5.4.
Section 5.6. 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 Administrators 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 Administrators, or any one of them, on behalf of the Issuer Trust shall
execute and make available for delivery, and the Property Trustee shall
authenticate, 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 Administrators 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 Issuer Trust corresponding to that evidenced by the lost, stolen or
destroyed Trust Certificate, as if originally issued, whether or not the lost,
stolen or destroyed Trust Securities Certificate shall be found at any time.
Section 5.7. Persons Deemed Holders
The Issuer Trustees or the Securities Registrar shall treat the Person
in whose name any Trust Securities are issued as the owner of such Trust
Securities for the purpose of receiving Distributions and for all other purposes
whatsoever, and none of the Issuer Trustees, the Administrators nor the
Securities Registrar shall be bound by any notice to the contrary.
Section 5.8. 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 Administrators accountable by reason
of the disclosure of its name and address, regardless of the source from which
such information was derived.
Section 5.9. Maintenance of Office or Agency
The Property Trustee shall designate, with the consent of the
Administrators, which consent shall not be unreasonably withheld, an office or
offices or agency or agencies where Capital Securities Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Issuer Trustees in respect of the Trust Securities
Certificates may be served. The Property Trustee initially designates its
Corporate Trust Office at Four Albany Street, New York, NY 10006, Attention:
Corporate Trust and Agency Group, as its corporate trust office for such
purposes. The Property Trustee shall give prompt written notice to the
Depositor, the Administrators and to the Holders of any change in the location
of the Securities Register or any such office or agency.
Section 5.10 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 Administrators. Any Paying Agent shall have the revocable power
to withdraw funds from the Payment Account solely for the purpose of making the
Distributions referred to above. The Property Trustee may revoke such power and
remove any Paying Agent in its sole discretion. The Paying Agent shall initially
be the Property Trustee. Any Person acting as Paying Agent shall be permitted to
resign as Paying Agent upon 30 days' written notice to the Administrators, and
the Property Trustee. In the event that the Property Trustee shall no longer be
the Paying Agent or a successor Paying Agent shall resign or its authority to
act be revoked, the Property Trustee shall appoint a successor (which shall be a
bank or trust company) that is reasonably acceptable to the Administrators to
act as Paying Agent. Such successor Paying Agent or any additional Paying Agent
appointed by the Administrators shall execute and deliver to the Issuer Trustees
an instrument in which such successor Paying Agent or additional Paying Agent
shall agree with the Issuer 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 Trust Agreement to the Paying Agent shall
include any co-paying agent chosen by the Property Trustee unless the context
requires otherwise.
Section 5.11. Ownership of Common Securities by Depositor.
At the Closing Date, the Depositor shall acquire and retain beneficial
and record ownership of the Common Securities. Neither the Depositor nor any
successor Holder of the Common Securities may transfer less than all the Common
Securities, and the Depositor or any such successor Holder may transfer the
Common Securities only (i) in connection with a consolidation or merger of the
Depositor into another Person or any conveyance, transfer or lease by the
Depositor of its properties and assets substantially as an entirety to any
Person, pursuant to Section 8.1 of the Indenture, or (ii) to an Affiliate of the
Depositor in compliance with applicable law (including the Securities Act and
applicable state securities and blue sky laws). To the fullest extent permitted
by law, any attempted transfer of the Common Securities, other than as set forth
in the immediately preceding sentence, shall be void. The Administrators shall
cause each Common Securities Certificate issued to the Depositor to contain a
legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO THE DEPOSITOR OR
AN AFFILIATE OF THE DEPOSITOR IN COMPLIANCE WITH APPLICABLE LAW AND SECTION 5.11
OF THE TRUST AGREEMENT."
Section 5.12 Notices to Clearing Agency.
To the extent that a notice or other communication to the Holders is
required under this Trust Agreement, for so long as Capital Securities are
represented by a Global Capital Securities Certificate, the Administrators and
the Issuer Trustees shall give all such notices and communications specified
herein to be given to the Clearing Agency, and shall have no obligations to the
Owners.
Section 5.13. 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 ownership interest in the assets of the Issuer 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 Issuer 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, as provided herein, will
be fully paid and nonassessable by the Issuer Trust. Except as otherwise
provided in Section 4.8, 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 Capital Securities remain Outstanding, if, upon a
Debenture Event of Default, the Debenture Trustee fails or the holders of not
less than 25% in principal amount of the outstanding Junior Subordinated
Debentures fail to declare the principal of all of the Junior Subordinated
Debentures to be immediately due and payable, the Holders of at least 25% in
Liquidation Amount of the Capital Securities then Outstanding shall have such
right to make such declaration by a notice in writing to the Property Trustee,
the Depositor and the Debenture Trustee.
At any time after such a declaration of acceleration with respect to
the Junior Subordinated Debentures has been made and before a judgment or decree
for payment of the money due has been obtained by the Debenture Trustee as
provided in the Indenture, the Holders of a Majority in Liquidation Amount of
the Capital Securities, by written notice to the Property Trustee, the Depositor
and the Debenture Trustee, may rescind and annul such declaration and its
consequences if:
(i) the Depositor has paid or deposited with the Debenture
Trustee a sum sufficient to pay
(A) all overdue installments of interest on all
of the Junior Subordinated Debentures,
(B) any accrued Additional Interest on all of the
Junior Subordinated Debentures,
(C) the principal of (and premium, if any, on) any
Junior Subordinated Debentures which have become due otherwise than by such
declaration of acceleration and interest and Additional Interest thereon
at the rate borne by the Junior Subordinated Debentures, and
(D) all sums paid or advanced by the Debenture
Trustee under the Indenture and the reasonable compensation, expenses,
disbursements and advances of the Debenture Trustee and the Property Trustee,
their agents and counsel; and
(ii) all Events of Default with respect to the Junior Subordinated
Debentures,
other than the non-payment of the principal of the Junior Subordinated
Debentures which has become due solely by such acceleration, have been cured or
waived as provided in Section 5.13 of the Indenture.
If the Property Trustee fails to annul any such declaration and waive
such default, the Holders of at least a Majority in Liquidation Amount of the
Capital Securities shall also have the right to rescind and annul such
declaration and its consequences by written notice to the Depositor, the
Property Trustee and the Debenture Trustee, subject to the satisfaction of the
conditions set forth in Clause (i) and (ii) of this Section 5.13.
The Holders of at least a Majority in Liquidation Amount of the Capital
Securities may, on behalf of the Holders of all the Capital 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 Debenture 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 Junior
Subordinated Debentures. 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 Capital
Securities all or part of which is represented by Global Capital Securities, a
record date shall be established for determining Holders of Outstanding Capital
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 5.13(b).
(c) For so long as any Capital Securities remain Outstanding, to the
fullest extent permitted by law and subject to the terms of this Trust Agreement
and the Indenture, upon a Debenture Event of Default specified in Section 5.1(1)
or 5.1(2) of the Indenture, any Holder of Capital 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 Junior Subordinated Debentures having an
aggregate principal amount equal to the aggregate Liquidation Amount of the
Capital Securities of such Holder (a "Direct Action"). Except as set forth in
Sections 5.13(b) and 5.13(c), the Holders of Capital Securities shall have no
right to exercise directly any right or remedy available to the holders of, or
in respect of, the Junior Subordinated Debentures.
ARTICLE VI.
ACTS OF HOLDERS; MEETINGS; VOTING
Section 6.1. Limitations on Holder's Voting Rights
(a) Except as provided in this Trust Agreement and in the Indenture and as
otherwise required by law, no Holder of Capital Securities shall have any right
to vote or in any manner otherwise control the administration, operation and
management of the Issuer 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 members of an association.
(b) So long as any Junior Subordinated Debentures are held by the Property
Trustee on behalf of the Issuer Trust, the Property Trustee shall not (i) direct
the time, method and place of conducting any proceeding for any remedy available
to the Debenture Trustee, or executing any trust or power conferred on the
Property Trustee with respect to such Junior Subordinated Debentures, (ii) waive
any past default that may be waived under Section 5.13 of the Indenture, (iii)
exercise any right to rescind or annul a declaration that the principal of all
the Junior Subordinated Debentures shall be due and payable or (iv) consent to
any amendment, modification or termination of the Indenture or the Junior
Subordinated Debentures, where such consent shall be required, without, in each
case, obtaining the prior approval of the Holders of at least a Majority in
Liquidation Amount of the Capital Securities, provided, however, that where a
consent under the Indenture would require the consent of each Holder of Junior
Subordinated Debentures affected thereby, no such consent shall be given by the
Property Trustee without the prior written consent of each Holder of Capital
Securities. The Property Trustee shall not revoke any action previously
authorized or approved by a vote of the Holders of Capital Securities, except by
a subsequent vote of the Holders of Capital Securities. The Property Trustee
shall notify all Holders of the Capital Securities of any notice of default
received with respect to the Junior Subordinated Debentures. In addition to
obtaining the foregoing approvals of the Holders of the Capital Securities,
prior to taking any of the foregoing actions, the Issuer Trustees shall, at the
expense of the Depositor, obtain an Opinion of Counsel experienced in such
matters to the effect that such action will not cause the Issuer Trust to be
taxable as a corporation for United States Federal income tax purposes. (c) If
any proposed amendment to the Trust Agreement provides for, or the Issuer Trust
otherwise proposes to effect, (i) any action that would adversely affect in any
material respect the interests, powers, preferences or special rights of the
Capital Securities, whether by way of amendment to the Trust Agreement or
otherwise, or (ii) the dissolution, winding-up or termination of the Issuer
Trust, other than pursuant to the terms of this Trust Agreement, then the
Holders of Outstanding Capital 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 in Liquidation
Amount of the Capital Securities.
Section 6.2. Notice of Meetings
Notice of all meetings of the Holders, 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, at his 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
No annual meeting of Holders is required to be held. The Property
Trustee, however, shall call a meeting of Holders to vote on any matter upon the
written request of the Holders of record of 25% of the aggregate Liquidation
Amount of the Capital Securities and the Administrators or the Property Trustee
may, at any time in their discretion, call a meeting of Holders of Capital
Securities to vote on any matters as to which Holders are entitled to vote.
Holders of at least a Majority in Liquidation Amount of the Capital
Securities, present in person or represented by proxy, shall constitute a quorum
at any meeting of Holders of the Capital Securities.
If a quorum is present at a meeting, an affirmative vote by the Holders
of record present, in person or by proxy, holding Capital Securities
representing at least a Majority in Liquidation Amount of the Capital Securities
held by the Holders present, either in person or by proxy, at such meeting shall
constitute the action of the Holders of Capital 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 $25 of Liquidation
Amount represented by their Outstanding Trust Securities in respect of any
matter as to which such Holders are entitled to vote.
Section 6.5 Proxies, etc.
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 Property Trustee, or with such other officer
or agent of the Issuer Trust as the Property Trustee 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 at least a Majority in Liquidation Amount
of all Trust Securities entitled to vote in respect of such action (or such
larger proportion thereof as shall be required by any other 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 Administrators or Property Trustee 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 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 otherwise expressly provided herein,
such action shall become effective when such instrument or instruments are
delivered to the Property Trustee. 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 Trust Agreement and (subject to Section
8.1) conclusive in favor of the Issuer 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 Issuer Trustee or Administrator receiving the same deems
sufficient.
The ownership of Trust 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 Issuer
Trustees, the Administrators or the Issuer 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 among the Holders, the Administrators or the
Issuer 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 Issuer Trustee under this Article VI, then the determination of
such matter by the Property Trustee shall be conclusive with respect to such
matter.
Section 6.9. Inspection of Records
Upon reasonable notice to the Administrators and the Property Trustee,
the records of the Issuer 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.
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 with trust powers, duly
organized, validly existing and in good standing under the laws of New York,
with trust power and authority to execute and deliver, and to carry out and
perform its obligations under the terms of this Trust Agreement.
(b) The execution, delivery and performance by the Property Trustee of this
Trust Agreement has been duly authorized by all necessary corporate action on
the part of the Property Trustee; and this Trust Agreement has been duly
executed and delivered by the Property Trustee, and constitutes a legal, valid
and binding obligation of the Property Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' rights
generally and to general principles of equity and the discretion of the court
(regardless of whether the enforcement of such remedies is considered in a
proceeding in equity or at law).
(c) The Delaware Trustee is duly organized, validly existing and in good
standing as a banking corporation under the laws of the State of Delaware, with
trust power and authority to execute and deliver, and to carry out and perform
its obligations under the terms of, the Trust Agreement.
(d) The execution, delivery and performance by the Delaware Trustee of this
Trust Agreement has been duly authorized by all necessary corporate action on
the part of the Delaware Trustee; and this Trust Agreement has been duly
executed and delivered by the Delaware Trustee, and constitutes a legal, valid
and binding obligation of the Delaware Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' right
generally and to general principles of equity and the discretion of the court
(regardless of whether the enforcement of such remedies is considered in a
proceeding in equity or at law).
(e) The Delaware Trustee is an entity which has its principal place of
business in the State of Delaware.
(f) The Property Trustee is a national or state-chartered bank and at the
time of appointment has securities rated in one of the three highest categories
by a nationally recognized statistical rating organization and has capital and
surplus of at least $50,000,000.
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 the Closing Date on behalf
of the Issuer Trust have been duly authorized and will have been duly and
validly executed, issued and delivered by the Issuer 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
Issuer Trust (or the Issuer Trustees on behalf of the Issuer Trust) under the
laws of the State of Delaware or any political subdivision thereof in connection
with the execution, delivery and performance by either the Property Trustee or
the Delaware Trustee, as the case may be, of this Trust Agreement.
ARTICLE VIII.
THE ISSUER TRUSTEES; THE ADMINISTRATORS
Section 8.1. Certain Duties and Responsibilities
(a) The duties and responsibilities of the Issuer Trustees and the
Administrators shall be as provided by this Trust Agreement and, in the case of
the Property Trustee, by the Trust Indenture Act. Notwithstanding the foregoing,
no provision of this Trust Agreement shall require the Issuer Trustees or the
Administrators 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 Issuer
Trustees or the Administrators shall be subject to the provisions of this
Section. Nothing in this Trust Agreement shall be construed to release an
Administrator from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct. To the extent that, at law or in
equity, an Issuer Trustee or Administrator has duties and liabilities relating
to the Issuer Trust or to the Holders, such Issuer Trustee or Administrator
shall not be liable to the Issuer Trust or to any Holder for such Issuer
Trustee's or Administrator'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 Issuer Trustees and Administrators
otherwise existing at law or in equity, are agreed by the Depositor and the
Holders to replace such other duties and liabilities of the Issuer Trustees and
Administrators.
(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 neither the Issuer Trustees nor
the Administrators are 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 Issuer
Trustees expressly set forth elsewhere in this Trust Agreement or, in the case
of the Property Trustee, in the Trust Indenture Act.
(c) The Property Trustee, before the occurrence of any Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Trust Agreement (including pursuant to Section 10.10), and no implied covenants
shall be read into this Trust Agreement against the Property Trustee. If an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 5.13 of the Indenture), the Property Trustee shall enforce this Trust
Agreement for the benefit of the Holders and shall exercise such of the rights
and powers vested in it by this Trust 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 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) 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 Property
Trustee shall be determined solely by the express provisions
of this Trust Agreement (including pursuant to Section 10.10),
and the Property Trustee shall not be liable except for the
performance of such duties and obligations as are specifically
set forth in this Trust Agreement (including pursuant to
Section 10.10); and
(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively rely,
as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Property Trustee and conforming to the
requirements of this Trust 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 Property Trustee, the Property Trustee shall
be under a duty to examine the same to determine whether or
not they conform to the requirements of this Trust Agreement;
(ii) 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;
(iii) the Property Trustee shall not be liable with respect to any
action taken
or omitted to be taken by it in good faith in accordance with the direction of
the Holders of at least a Majority in Liquidation Amount of the Capital
Securities relating to the time, method and place of conducting any proceeding
for any remedy available to the Property Trustee, or exercising any trust or
power conferred upon the Property Trustee under this Trust Agreement;
(iv) the Property Trustee's sole duty with respect to the custody,
safe keeping and
physical preservation of the Junior Subordinated Debentures 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;
(v) 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;
(vi) the Property Trustee shall not be responsible for monitoring the
compliance by the Administrators or the Depositor with their respective duties
under this Trust Agreement, nor shall the Property Trustee be liable for the
default or misconduct of any other Issuer Trustee, the Administrators or the
Depositor; and
(vii) no provision of this Trust Agreement shall require the Property
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if the Property 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 Trust Agreement or adequate indemnity
against such risk or liability is not reasonably assured to it.
(e) The Administrators shall not be responsible for monitoring the
compliance by the Issuer Trustees or the Depositor with their respective
duties under this Trust Agreement, nor shall either Administrator be liable
for the default or misconduct of any other Administrator, the Issuer
Trustees or the Depositor.
SECTION 8.2. Certain Notices
Within five Business Days after the occurrence of any Event of Default
actually known to a Responsible Officer of 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 and the Administrators,
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 to defer the payment of interest on the Junior
Subordinated Debentures pursuant to the Indenture, the Property Trustee shall
transmit, in the manner and to the extent provided in Section 10.8, notice of
such exercise to the Holders and the Administrators, 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 conclusively rely and shall be fully 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) any direction or act of the Depositor contemplated by this Trust
Agreement shall be sufficiently evidenced by an Officers' Certificate;
(c) the Property Trustee shall have no duty to see to any recording, filing
or registration of any instrument (including any financing or continuation
statement or any filing under tax or securities laws) or any re-recording,
refiling or reregistration thereof;
(d) the Property Trustee may consult with counsel of its own choosing
(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;
(e) 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 security or indemnity
satisfactory to it against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction; provided that,
nothing contained in this Section 8.3(e) shall be taken to relieve the Property
Trustee, upon the occurrence of an Event of Default, of its obligation to
exercise the rights and powers vested in it by this Trust Agreement;
(f) 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;
(g) the Property Trustee may execute any of the trusts or powers hereunder
or perform any of its duties hereunder either directly or by or through its
agents or attorneys, provided that the Property Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney appointed
with due care by it hereunder;
(h) 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 (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 fully protected in
acting in accordance with such instructions;
(i) 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 any Issuer
Trustee or Administrator 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 any Issuer Trustee or Administrator shall be
construed to be a duty;
(j) 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 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 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;
(k) 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 conclusively rely upon an Officers'
Certificate which, upon receipt of such request, shall be promptly delivered
by the Depositor or the Administrators;
(l) when the Property Trustee incurs expenses or renders
services in connection with a Bankruptcy Event, such expenses (including the
fees and expenses of its counsel) and the compensation for such services are
intended to constitute expenses of administration under any bankruptcy law or
law relating to creditors rights generally; and
(m) the Property Trustee shall not be charged with knowledge of an
Event of Default unless such Event of Default has occurred as a result of
the act or failure to act of the Property Trustee, a Responsible Officer of
the Property Trustee obtains actual knowledge of such event or the Property
Trustee receives written notice of such event from Securityholders at least 25%
of the Outstanding Trust Securities (based upon Liquidation Amount).
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 Issuer Trust, and the Issuer Trustees
and the Administrators do not assume any responsibility for their correctness.
The Issuer Trustees and the Administrators shall not be accountable for the use
or application by the Depositor of the proceeds of the Junior Subordinated
Debentures.
Section 8.5. May Hold Securities
The Administrators, any Issuer Trustee or any other agent of any Issuer
Trustee or the Issuer Trust, in its individual or any other capacity, may become
the owner or pledgee of Trust Securities and, subject to Sections 8.8 and 8.13,
and except as provided in the definition of the term "Outstanding" in Article I,
may otherwise deal with the Issuer Trust with the same rights it would have if
it were not an Administrator, Issuer Trustee or such other agent.
Section 8.6. Compensation; Indemnity; Fees
The Depositor, as borrower, agrees:
(a) to pay to the Issuer Trustees from time to time such reasonable
compensation for all services rendered by them hereunder as the parties shall
agree from time to time (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust);
(b) to reimburse the Issuer Trustees upon request for all reasonable
expenses, disbursements and advances incurred or made by the Issuer 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 their
negligence or willful misconduct; and
(c) to the fullest extent permitted by applicable law, to indemnify and
hold harmless (i) each Issuer Trustee, (ii) each Administrator, (iii) any
Affiliate of any Issuer Trustee, (iv) any officer, director, shareholder,
employee, representative or agent of any Issuer Trustee, and (v) any employee or
agent of the Issuer Trust, (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 arising out of or
in connection with the creation, operation or dissolution of the Issuer Trust or
any act or omission performed or omitted by such Indemnified Person in good
faith on behalf of the Issuer 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 or the earlier resignation or removal of any Issuer
Trustee.
No Issuer 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, any Administrator and any Issuer Trustee (subject to
Section 8.8) 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 Issuer Trust, and the Issuer 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 Issuer
Trust, shall not be deemed wrongful or improper. Neither the Depositor, any
Administrator, nor any Issuer Trustee shall be obligated to present any
particular investment or other opportunity to the Issuer Trust even if such
opportunity is of a character that, if presented to the Issuer Trust, could be
taken by the Issuer Trust, and the Depositor, any Administrator or any Issuer
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 Issuer 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.
In the event that the Property Trustee is also acting as Paying Agent
or Securities Registrar hereunder, the rights and protections afforded to the
Property Trustee pursuant to this Article VIII shall also be afforded to such
Paying Agent or Securities Registrar.
Section 8.7. Corporate Property Trustee Required; Eligibility of Trustees and
Administrators
(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 a
national or state chartered bank and 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. At the time of appointment, the Property Trustee must have securities
rated in one of the three highest rating categories by a nationally recognized
statistical rating organization.
(b) There shall at all times be one or more Administrators hereunder. Each
Administrator 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. An employee, officer or Affiliate of the Depositor may serve as an
Administrator.
(c) There shall at all times be a Delaware Trustee. 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
sufficiently described in this Trust Agreement for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture Act.
Section 8.9. Co-Trustees and Separate Trustee
Unless an Event of Default shall have occurred and be continuing, at
anytime 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 Property Trustee shall have power to appoint, and
upon the written request of the Property Trustee, the Depositor and the
Administrators shall for such purpose join with the Property Trustee 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. 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
bylaw, but to such extent only, be appointed subject to the following terms,
namely:
(a) The Trust Securities shall be executed by one or more Administrators,
and the Trust Securities shall be authenticated 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 Property Trustees specified hereunder, shall be
exercised, solely by the Property Trustee 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 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.
(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 a Debenture 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 or any employees or agents of a co-trustee and
separate trustee nor shall it be liable for the supervision of a co-trustee or
separate trustee or employees or agents of a co-trustee and 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 Issuer Trustee (the "Relevant
Trustee") and no appointment of a successor Issuer Trustee pursuant to this
Article shall become effective until the acceptance of appointment by the
successor Issuer Trustee in accordance with the applicable requirements of
Section 8.11.
Subject to the immediately preceding paragraph, a Relevant Trustee may
resign at any time by giving written notice thereof to the Depositor and the
Issuer Trust. The Relevant Trustee shall appoint a successor by requesting from
at least three Persons meeting the eligibility requirements its expenses and
charges to serve as the Relevant Trustee on a form provided by the
Administrators, and selecting the Person who agrees to the lowest expenses and
charges. If the instrument of acceptance by the successor Issuer Trustee
required by Section 8.11 shall not have been delivered to the Relevant Trustee
within 60 days after the giving of such notice of resignation, the Relevant
Trustee may petition, at the expense of the Issuer Trust, any court of competent
jurisdiction for the appointment of a successor Relevant Trustee.
The Holders of at least a majority in aggregate liquidation amount of
the outstanding Capital Securities may remove an Issuer Trustee if a Debenture
Event of Default has occurred and is continuing. If an Issuer Trustee is removed
at a time when a Debenture Event of Default has occurred and is continuing, the
Holders of at least a majority in aggregate liquidation amount of Capital
Securities may appoint a successor Issuer Trustee, and such successor Issuer
Trustee shall comply with the applicable requirements of Section 8.11. If no
Debenture Event of Default has occurred and is continuing at such time, the
Depositor, as Holder of the Common Securities, may remove the Issuer Trustee and
appoint a successor. If an Administrator is removed, resigns or otherwise
vacates office, the Depositor, as Holder of the Common Securities, shall
promptly appoint a successor. In no event shall the Holders of the Capital
Securities have the right to vote to remove an Administrator. The Depositor, as
Holder of the Common Securities, shall have the exclusive right to vote to
remove an Administrator.
If no successor Relevant Trustee shall have been so appointed by the
Holders of the Capital Securities or the Depositor, as Holder of the Common
Securities, as the case may be, and accepted appointment in the manner required
by Section 8.11, any Holder, on behalf of himself and all others similarly
situated, or any removed Issuer Trustee, may 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 an Issuer Trustee and each appointment of a successor Issuer Trustee
to all Holders in the manner provided in Section 10.8 and shall give notice to
the Depositor and to the Administrators. 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 Delaware Trustee who is a natural person dies or
becomes, in the opinion of the Holders of the Common Securities, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity may
be filled by the Property Trustee following the procedures regarding expenses
and charges set forth above (with the successor in each case being a Person who
satisfies the eligibility requirements for Administrators 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 such successor Relevant Trustee with
respect to the Trust Securities shall execute, acknowledge and deliver an
amendment hereto wherein each successor Relevant 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 Issuer 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 Issuer Trust by
more than one Relevant Trustee 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 Issuer Trust or any successor Relevant Trustee such retiring
Relevant Trustee shall, upon payment of its charges, 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 Issuer Trust.
Upon request of any such successor Relevant Trustee, the Issuer 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 Person into which the Property Trustee or the Delaware Trustee may
be merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such Relevant
Trustee shall be a party, or any Person succeeding to all or substantially all
the corporate trust business of such Relevant Trustee, shall be the successor of
such Relevant Trustee hereunder, provided that such Person 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.
Section 8.13. Preferential Collection of Claims Against Depositor or Issuer
Trust
If and when the Property Trustee shall be or become a creditor of the
Depositor (or any other obligor upon the Trust Securities), the Property Trustee
shall be subject to the provisions of the Trust Indenture Act regarding the
collection of claims against the Depositor (or any such other obligor) as is
required by the Trust Indenture Act.
Section 8.14. Trustee May File Proofs of Claim
In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other similar judicial
proceeding relative to the Issuer Trust or any other obligor upon the Trust
Securities or the property of the Issuer Trust or of such other obligor, the
Property Trustee (irrespective of whether any Distributions on the Trust
Securities shall then be due and payable and irrespective of whether the
Property Trustee shall have made any demand on the Issuer Trust for the payment
of any past due Distributions) shall be entitled and empowered, to the fullest
extent permitted by law, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any Distributions
owing and unpaid in respect of the 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 monies 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 8.15. Reports by Property Trustee
(a) Not later than January 31 of each year commencing with January 31,
1999, 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 November 30 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; and
(ii) 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 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 as set forth in Section 10.10 of
this Trust Agreement.
(c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Property Trustee with the Depositor.
Section 8.16. Reports to the Property Trustee
The Depositor and the Administrators on behalf of the Issuer Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act 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, as set forth in Section 10.10 of this Trust Agreement. The Depositor and
the Administrators shall annually file with the Property Trustee a certificate
specifying whether such Person is in compliance with all the terms and covenants
applicable to such Person hereunder.
Section 8.17. Evidence of Compliance with Conditions Precedent
Each of the Depositor and the Administrators on behalf of the Issuer
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 as
set forth in Section 10.10 of this Trust Agreement. 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 8.18. Number of Issuer Trustees
(a) The number of Issuer Trustees shall be two. The Property Trustee and
the Delaware Trustee may be the same Person, in which case the number of Issuer
Trustees may be one.
(b) If an Issuer Trustee ceases to hold office for any reason, a vacancy
shall occur. The vacancy shall be filled with an Issuer Trustee appointed in
accordance with Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy, dissolution,
termination, incompetence or incapacity to perform the duties of an Issuer
Trustee shall not operate to dissolve, terminate or annul the Issuer Trust or
terminate this Trust Agreement.
Section 8.19. Delegation of Power
(a) Any Administrator 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) or
making any governmental filing; and
(b) The Administrators shall have power to delegate from time to time to
such of their number the doing of such things and the execution of such
instruments either in the name of the Issuer Trust or the names of the
Administrators or otherwise as the Administrators may deem expedient, to the
extent such delegation is not prohibited by applicable law or contrary to the
provisions of this Trust Agreement.
Section 8.20. Appointment of Administrators
(a) The Administrators shall be appointed by the Holders of a Majority in
Liquidation Amount of the Common Securities and may be removed by the Holders of
a Majority in Liquidation Amount of the Common Securities or may resign at
anytime. Upon any resignation or removal, the Depositor shall appoint a
successor Administrator. Each Administrator shall execute this Trust Agreement
thereby agreeing to comply with, and be legally bound by, all of the terms,
conditions and provisions of this Trust Agreement. If at any time there is no
Administrator, the Property Trustee or any Holder who has been a Holder of Trust
Securities for at least six months may petition any court of competent
jurisdiction for the appointment of one or more Administrators.
(b) Whenever a vacancy in the number of Administrators shall occur, until
such vacancy is filled by the appointment of an Administrator in accordance with
this Section 8.20, the Administrators in office, regardless of their number (and
notwithstanding any other provision of this Agreement), shall have all the
powers granted to the Administrators and shall discharge all the duties imposed
upon the Administrators by this Trust Agreement.
(c) Notwithstanding the foregoing, or any other provision of this Trust
Agreement, in the event any Administrator or a Delaware Trustee who is a natural
person dies or becomes, in the opinion of the Holders of a Majority in
Liquidation Amount of the Common Securities, incompetent, or incapacitated, the
vacancy created by such death, incompetence or incapacity may be filled by the
remaining Administrators, if there were at least two of them prior to such
vacancy, and by the Depositor, if there were not two such Administrators
immediately prior to such vacancy (with the successor in each case being a
Person who satisfies the eligibility requirement for Administrators or Delaware
Trustee, as the case may be, set forth in Section 8.7).
ARTICLE IX.
DISSOLUTION, LIQUIDATION AND MERGER
Section 9.1. Dissolution Upon Expiration Date
Unless earlier dissolved, the Issuer Trust shall automatically dissolve
on April 15, 2039 (the "Expiration Date"), and thereafter the Trust Property
shall be distributed in accordance with Section 9.4.
Section 9.2. Early Termination
The first to occur of any of the following events is an "Early
Termination Event" and the occurrence of which shall cause the dissolution of
the Issuer Trust:
(a) the occurrence of the appointment of a receiver or other similar
official in any liquidation, insolvency or similar proceeding with respect to
the Depositor or all or substantially all of its property, or a court or other
governmental agency shall enter a decree or order and such decree or order shall
remain unstayed and undischarged for a period of 60 days, unless the Depositor
shall transfer the Common Securities as provided by Section 5.11, in which case
this provision shall refer instead to any such successor Holder of the Common
Securities;
(b) the written direction to the Property Trustee from the Holder of the
Common Securities at any time to dissolve the Issuer Trust and to distribute the
Junior Subordinated Debentures to Holders in exchange for the Capital Securities
(which direction, subject to Section 9.4(a), is optional and wholly within the
discretion of the Holders of the Common Securities);
(c) the redemption of all of the Capital Securities in connection with the
redemption of all the Junior Subordinated Debentures; and
(d) the entry of an order for dissolution of the Issuer Trust by a court of
competent jurisdiction.
Section 9.3. Termination
As soon as is practicable after the occurrence of an event referred to
in Section 9.1 or 9.2, and upon the completion of the winding up and liquidation
of the Issuer Trust, the Administrators (each of whom is hereby authorized to
take such action) shall file a certificate of cancellation with the Secretary of
State of the State of Delaware terminating the Trust and, upon such filing, the
respective obligations and responsibilities of the Issuer Trustees, the
Administrators and the Issuer Trust shall terminate.
Section 9.4. Liquidation
(a) If an Early Termination Event specified in clause (a), (b) or (d) of
Section 9.2 occurs or upon the Expiration Date, the Issuer Trust shall be wound
up and liquidated by the Property Trustee as expeditiously as the Property
Trustee determines to be possible by distributing, after paying or making
reasonable provision to pay all claims and obligations of the Issuer Trust in
accordance with Section 3808(e) of the Delaware Business Trust Act, to each
Holder a Like Amount of Junior Subordinated Debentures, 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 15 nor more than 45
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 Junior
Subordinated Debentures; and
(iii) provide such information with respect to the mechanics by
which Holders may exchange Trust Securities Certificates for
Junior Subordinated Debentures, or if Section 9.4(d) applies
receive a Liquidation Distribution, as the Administrators
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 Issuer Trust and distribution of the Junior Subordinated
Debentures to Holders, the Property Trustee shall establish a record date for
such distribution (which shall be not more than 30 days prior to the Liquidation
Date) and, 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 Junior Subordinated Debentures in
exchange for the Outstanding Trust Securities Certificates.
(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)
the Clearing Agency for the Capital Securities or its nominee, as the registered
holder of the Global Capital Securities Certificate, shall receive a registered
global certificate or certificates representing the Junior Subordinated
Debentures to be delivered upon such distribution with respect to Capital
Securities held by the Clearing Agency or its nominee, and, (iii) any Trust
Securities Certificates not held by the Clearing Agency for the Capital
Securities or its nominee as specified in clause (ii) above will be deemed to
represent Junior Subordinated Debentures having a principal amount equal to the
stated Liquidation Amount of the Trust Securities represented thereby and
bearing accrued and unpaid interest in an amount equal to the accumulated and
unpaid Distributions on such Trust Securities until such certificates are
presented to the Securities Registrar for transfer or reissuance.
(d) If, 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 Junior Subordinated Debentures is not
practical, or if any Early Termination Event specified in clause (c) of Section
9.2 occurs, the Issuer Trust shall be dissolved and wound up and the Trust
Property shall be liquidated by the Property Trustee in such manner as the
Property Trustee determines. In such event, on the date of the dissolution of
the Issuer Trust, unless the Trust Securities have been redeemed or are to be
redeemed on such date pursuant to Article IV, Holders will be entitled to
receive out of the assets of the Issuer Trust available for distribution to
Holders, after paying or making reasonable provision to pay all claims and
obligations of the Issuer Trust in accordance with Section 3808(e) of the
Delaware Business Trust Act, an amount equal to the aggregate of 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, the Liquidation Distribution can be paid only in part
because the Issuer 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 Issuer Trust on the Trust Securities shall
be paid on a pro rata basis (based upon Liquidation Amounts). The Holders of the
Common Securities will be entitled to receive Liquidation Distributions upon any
such dissolution pro rata (determined as aforesaid) with Holders of Capital
Securities, except that, if a Debenture Event of Default has occurred and is
continuing, the Capital Securities shall have a priority over the Common
Securities as provided in Section 4.3.
Section 9.5. Mergers, Consolidations, Amalgamations or Replacements of
the Issuer Trust
The Issuer 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 entity, except pursuant to this Section 9.5
or Section 9.4. At the request of the Holders of the Common Securities, and with
the consent of the Holders of at least a Majority in Liquidation Amount of the
Capital Securities, the Issuer Trust may merge with or into, consolidate,
amalgamate, or be replaced by or convey, transfer or lease its properties and
assets substantially as an entirety to a trust organized as such under the laws
of any State; provided, however, that (i) such successor entity either (a)
expressly assumes all of the obligations of the Issuer Trust with respect to the
Capital Securities or (b) substitutes for the Capital Securities other
securities having substantially the same terms as the Capital Securities
(the"Successor Securities") so long as the Successor Securities have the same
priority as the Capital Securities with respect to distributions and payments
upon liquidation, redemption and otherwise, (ii) a trustee of such successor
entity possessing the same powers and duties as the Property Trustee is
appointed to hold the Junior Subordinated Debentures, (iii) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
cause the Capital Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating organization, (iv)
such merger, consolidation, amalgamation, replacement, conveyance, transfer or
lease does not adversely affect the rights, preferences and privileges of the
holders of the Capital Securities (including any Successor Securities) in any
material respect, (v) such successor entity has a purpose substantially
identical to that of the Issuer Trust, (vi) prior to such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the Issuer Trustee has
received an Opinion of Counsel from counsel experienced in such matters 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 Capital Securities (including any Successor
Securities) in any material respect, and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the Issuer Trust nor such successor entity will be required to register as
an"investment company" under the Investment Company Act and (vii) the Depositor
or any permitted transferee to whom it has transferred the Common Securities
hereunder own 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 Agreement.
Notwithstanding the foregoing, the Issuer Trust shall not, except with the
consent of holders of 100% in Liquidation Amount of the Capital 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 Issuer Trust or the successor
entity to be taxable as a corporation for United States Federal income tax
purposes.
ARTICLE X.
MISCELLANEOUS PROVISIONS
Section 10.1. Limitation of Rights of Holders
Except as set forth in Section 9.2, the death, incapacity, dissolution,
termination or bankruptcy of any Person having an interest, beneficial or
otherwise, in Trust Securities shall not operate to terminate this Trust
Agreement, nor dissolve or terminate the Issuer Trust, nor entitle the legal
representatives, successors 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-up of the arrangements contemplated hereby, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them. Any merger or similar agreement authorized in accordance with
this Trust Agreement shall be executed by one or more of the Administrators on
behalf of the Issuer Trust.
Section 10.2. Amendment
(a) This Trust Agreement may be amended from time to time by the Property
Trustee and the Holders of a Majority in Liquidation Amount of the Common
Securities, without the consent of any Holder of the Capital Securities (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,
provided, however, that such amendment shall not adversely affect in any
material respect the interests of any Holder 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 Issuer Trust will not be taxable as a corporation for United
States Federal income tax purposes at any time that any Trust Securities are
Outstanding or to ensure that the Issuer Trust will not be required to register
as an investment company under the Investment Company Act.
(b) Except as provided in Section 10.2(c) hereof, any provision of this
Trust Agreement may be amended by the Property Trustee and the Holders of a
Majority in Liquidation Amount of the Common Securities with (i) the consent of
Holders of at least a Majority in Liquidation Amount of the Capital Securities
and (ii) receipt by the Issuer Trustees of an Opinion of Counsel to the effect
that such amendment or the exercise of any power granted to the Issuer Trustees
in accordance with such amendment will not cause the Issuer Trust to be taxable
as a corporation for United States federal income tax purposes or affect the
Issuer Trust's exemption from status of an "investment company" under the
Investment Company Act
(c) In addition to and notwithstanding any other provision in this Trust
Agreement, without the consent of each affected Holder, 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.
(d) Notwithstanding any other provisions of this Trust Agreement, no Issuer
Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Issuer Trust to fail or cease to qualify for the exemption
from status as an "investment company" under the Investment Company Act or be
taxable as a corporation for United States Federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor and the Administrators, this Trust
Agreement may not be amended in a manner which imposes any additional obligation
on the Depositor or the Administrators.
(f) In the event that any amendment to this Trust Agreement is made, the
Administrators or the Property Trustee 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 and all conditions precedent have been met.
(h) Any amendments to this Trust Agreement, pursuant to Section 10.2(a),
shall become effective when notice of such amendment is given to the Holders of
the Trust Securities.
(i) 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 Issuer Trust to be taxable as a corporation for United States
Federal income tax purposes.
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 ISSUER TRUST, THE DEPOSITOR, THE ISSUER TRUSTEES AND THE
ADMINISTRATORS SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF DELAWARE AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH
LAWS WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS OF THE STATE OF
DELAWARE OR ANY OTHER JURISDICTION THAT WOULD CALL FOR THE APPLICATION OF THE
LAW OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE; PROVIDED, HOWEVER,
THAT THERE SHALL NOT BE APPLICABLE TO THE HOLDERS, THE ISSUER TRUST, THE
DEPOSITOR, THE ISSUER TRUSTEES, THE ADMINISTRATORS OR THIS TRUST AGREEMENT ANY
PROVISION OF THE LAWS (STATUTORY OR COMMON) OF THE STATE OF DELAWARE PERTAINING
TO TRUSTS THAT RELATE TO OR REGULATE, IN A MANNER INCONSISTENT WITH THE TERMS
HEREOF (A) THE FILING WITH ANY COURT OR GOVERNMENTAL BODY OR AGENCY OF TRUSTEE
ACCOUNTS OR SCHEDULES OF TRUSTEE FEES AND CHARGES, (B) AFFIRMATIVE REQUIREMENTS
TO POST BONDS FOR TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (C) THE
NECESSITY FOR OBTAINING COURT OR OTHER GOVERNMENTAL APPROVAL CONCERNING THE
ACQUISITION, HOLDING OR DISPOSITION OF REAL OR PERSONAL PROPERTY, (D) FEES OR
OTHER SUMS PAYABLE TO TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (E)
THE ALLOCATION OF RECEIPTS AND EXPENDITURES TO INCOME OR PRINCIPAL, (F)
RESTRICTIONS OR LIMITATIONS ON THE PERMISSIBLE NATURE, AMOUNT OR CONCENTRATION
OF TRUST INVESTMENTS OR REQUIREMENTS RELATING TO THE TITLING, STORAGE OR OTHER
MANNER OF HOLDING OR INVESTING TRUST ASSETS OR (G) THE ESTABLISHMENT OF
FIDUCIARY OR OTHER STANDARDS OF RESPONSIBILITY OR LIMITATIONS ON THE ACTS OR
POWERS OF TRUSTEES THAT ARE INCONSISTENT WITH THE LIMITATIONS OR LIABILITIES OR
AUTHORITIES AND POWERS OF THE ISSUER TRUSTEES OR THE ADMINISTRATORS AS SET FORTH
OR REFERENCED IN THIS TRUST AGREEMENT. SECTION 3540 OF TITLE 12 OF THE DELAWARE
CODE SHALL NOT APPLY TO THE ISSUER TRUST.
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 4.2(d)), and no Distributions shall accumulate on
such unpaid amount for the period after such date, except that, if such Business
Day is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date on which such payment was originally payable.
Section 10.6. Successors
This Trust Agreement shall be binding upon and shall inure to the
benefit of any successor to the Depositor, the Issuer Trust, the Administrators
and any Issuer 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 VIII 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.
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 that 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 Capital 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 Common
Securities or the Depositor, to Equitable Resources, Inc., 420 Boulevard of the
Allies, Pittsburgh, Pennsylvania 15219, Attention: Office of the Secretary,
facsimile no.:(412) 553-5757 or to such other address as may be specified in a
written notice by the Depositor to the Property Trustee. 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. Such notice, demand or other communication to or upon the
Depositor shall be deemed to have been sufficiently given or made only upon
actual receipt of the writing by the Depositor.
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 Property Trustee, the Delaware Trustee, the Administrators, or the Issuer
Trust shall be given in writing addressed (until another address is published by
the Issuer Trust) as follows: (a) with respect to the Property Trustee to
Bankers Trust Company, Four Albany Street, 4th Floor, New York, NY 10006,
Attention: Corporate Trust and Agency Group Public Utilities; (b) with respect
to the Delaware Trustee to Bankers Trust (Delaware), E.A. Delle Donne Corporate
Center, Montgomery Building, 1011 Centre Road, Suite 200, Wilmington, DE 19805,
Attention: Lisa Wilkins; (c) with respect to the Administrators, to them at the
address above for notices to the Depositor, marked "Attention: Office of the
Secretary"; and (d) with respect to the Issuer Trust, to c/o Equitable
Resources, Inc., 420 Boulevard of the Allies, Pittsburgh, Pennsylvania 15219,
Attention: office of the Secretary. Such notice, demand or other communication
to or upon the Issuer Trust or the Property Trustee shall be deemed to have been
sufficiently given or made only upon actual receipt of the writing by the Issuer
Trust, the Property Trustee, or such Administrator.
Section 10.9. Agreement Not to Petition
Each of the Issuer Trustees, the Administrators and the Depositor agree
for the benefit of the Holders that, until at least one year and one day after
the Issuer Trust has been terminated in accordance with Article IX, they shall
not file, or join in the filing of, a petition against the Issuer 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 Issuer 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 petition by the Depositor against the Issuer 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 estopped and precluded therefrom and such
other defenses, if any, as counsel for the Issuer Trustee or the Issuer Trust
may assert. If any Issuer Trustee or Administrator takes action in violation of
this Section 10.9, the Depositor agrees, for the benefit of the 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 petition by such Person against
the Depositor or the commencement of such action and raise the defense that such
Person has agreed in writing not to take such action and should be estopped and
precluded therefrom and such other defenses, if any, as counsel for the Issuer
Trustee or the Issuer 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) Trust Indenture Act; Application. (i) This Trust Agreement is subject
to the provisions of the Trust Indenture Act that are required to be a part of
this Trust Agreement and shall, to the extent applicable, be governed by such
provisions; (ii) if and to the extent that any provision of this Trust 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; (iii)
for purposes of this Trust Agreement, the Property Trustee, to the extent
permitted by applicable law and/or the rules and regulations of the Commission,
shall be the only Issuer Trustee which is a trustee for the purposes of the
Trust Indenture Act; and (iv) the application of the Trust Indenture Act to this
Trust Agreement shall not affect the nature of the Capital Securities and the
Common Securities as equity securities representing undivided beneficial
interests in the assets of the Issuer Trust.
(b) Lists of Holders of Capital Securities. (i) Each of the Depositor and
the Administrators on behalf of the Trust shall provide the Property Trustee
with such information as is required under Section 312(a) of the Trust Indenture
Act at the times and in the manner provided in Section 312(a) and (ii) the
Property Trustee shall comply with its obligations under Sections 310(b), 311
and 312(b)of the Trust Indenture Act.
(c) Reports by the Property Trustee. Within 60 days after November 30 of
each year, the Property Trustee shall provide to the Holders of the Trust
Securities such reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form, in the manner and at the times provided by Section 313
of the Trust Indenture Act. The Property Trustee shall also comply with the
requirements of Section 313(d) of the Trust Indenture Act.
(d) Periodic Reports to Property Trustee. Each of the Depositor and the
Administrators on behalf of the Issuer Trust shall provide to the Property
Trustee, the Commission and the Holders of the Trust Securities, as applicable,
such documents, reports and information as required by Section 314(a)(1) - (3)
(if any) of the Trust Indenture Act and the compliance certificates required by
Section 314(a)(4) and (c) of the Trust Indenture Act (provided that any
certificate to be provided pursuant to Section 314(a)(4) of the Trust Indenture
Act shall be provided within 120 days of the end of each fiscal year of the
Issuer Trust).
(e) Evidence of Compliance with Conditions Precedent. Each of the Depositor
and the Administrators on behalf of the Issuer Trust shall provide to the
Property Trustee such evidence of compliance with any conditions precedent, if
any, provided for in this Trust Agreement which relate to any of the matters set
forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given pursuant to Section 314(c) shall comply with Section 314(e)
of the Trust Indenture Act.
(f) Disclosure of Information. The disclosure of information as to the
names and addresses of the Holders of Trust Securities in accordance with
Section 312 of the Trust Indenture Act, regardless of the source from which such
information was derived, shall not be deemed to be a violation of any existing
law or any law hereafter enacted which does not specifically refer to Section
312 of the Trust Indenture Act, nor shall the Property Trustee be held
accountable by reason of mailing any material pursuant to a request made under
Section 312(b) of the Trust Indenture Act.
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, THE GUARANTEE AGREEMENT
AND THE INDENTURE, AND THE AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER
TERMS OF THE GUARANTEE AGREEMENT AND THE INDENTURE, AND SHALL CONSTITUTE THE
AGREEMENT OF THE ISSUER TRUST, SUCH HOLDER AND SUCH OTHERS THAT THE TERMS AND
PROVISIONS OF THIS TRUST AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS
BETWEEN THE ISSUER TRUST AND SUCH HOLDER AND SUCH OTHERS.
Section 10.12. Counterparts
This instrument may be executed in any number or 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.
EQUITABLE RESOURCES, INC.,
as Depositor
By:___________________________________________
Name: Jeffrey C. Swoveland
Title: Vice president - Finance and Treasurer
BANKERS TRUST COMPANY,
as Property Trustee, and
not in its individual capacity
By:___________________________________________
Name: Scott Thiel
Title: Assistant Vice President
BANKERS TRUST (DELAWARE),
as Delaware Trustee, and not
in its individual capacity
By:__________________________________________
Name: M. Lisa Wilkins
Title: Assistant Secretary
Agreed to and Accepted by,
- ------------------------------------------
Name: Jeffrey C. Swoveland
Title: Administrator
- ------------------------------------------
Name: Philip P. Conti
Title: Administrator
<PAGE>
EXHIBIT A
CERTIFICATE OF TRUST
<PAGE>
EXHIBIT B
FORM OF LETTER OF REPRESENTATIONS
<PAGE>
Exhibit C
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO THE
DEPOSITOR OR AN AFFILIATE OF THE DEPOSITOR IN COMPLIANCE
WITH APPLICABLE LAW AND SECTION 5.11 OF THE TRUST AGREEMENT
Certificate Number Number of Common Securities
C-1 154,640
Certificate Evidencing Common Securities
of
Equitable Resources Capital Trust I
7.35% Common Securities
(liquidation amount $25 per Common Security)
Equitable Resources Capital Trust I, a statutory business trust created
under the laws of the State of Delaware (the "Issuer Trust"), hereby certifies
that Equitable Resources, Inc. (the "Holder") is the registered owner of One
Hundred Fifty Four Thousand Six Hundred Forty (154,640) common securities of the
Issuer Trust representing undivided beneficial interests in assets of the Issuer
Trust and has designated the 7.35% Common Securities (liquidation amount $25 per
Common Security) (the "Common Securities"). Except in accordance with Section
5.11 of the Trust Agreement (as defined below) the Common Securities are not
transferable and any attempted transfer hereof other than in accordance
therewith 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 Issuer Trust, dated as of April 23,
1998, as the same may be amended from time to time (the "Trust Agreement") among
Equitable Resources, Inc., as Depositor, Bankers Trust Company, as Property
Trustee, Bankers Trust (Delaware), as Delaware Trustee, two individuals selected
by the holders of the Common Securities to act as administrators with respect to
the Issuer Trust (the "Administrators") and the holders of Trust Securities,
including the designation of the terms of the Common Securities as set forth
therein. The Holder is entitled to the benefits of a Guarantee Agreement entered
into by Equitable Resources, Inc., dated April 23, 1998 (the " Guarantee
Agreement"), to the extent provided therein. The Issuer Trust will furnish a
copy of the Trust Agreement and the Guarantee Agreement to the Holder without
charge upon written request to the Issuer 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.
Terms used but not defined herein have the meanings set forth in the
Trust Agreement.
IN WITNESS WHEREOF, one of the Administrators of the Issuer Trust has
executed this certificate this 23rd day of April, 1998.
EQUITABLE RESOURCES CAPITAL TRUST I
By:_______________________________________
Name:
Administrator
<PAGE>
Exhibit D
[IF THE CAPITAL SECURITIES CERTIFICATE IS TO BE A GLOBAL CAPITAL
SECURITIES CERTIFICATE, INSERT -- THIS CAPITAL SECURITIES CERTIFICATE IS A
GLOBAL CAPITAL SECURITIES CERTIFICATE WITHIN THE MEANING OF THE TRUST AGREEMENT
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS CAPITAL SECURITY CERTIFICATE IS EXCHANGEABLE FOR
CAPITAL SECURITIES CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN
THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCE DESCRIBED IN THE
TRUST AGREEMENT AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY
TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE TRUST AGREEMENT.
UNLESS THIS CAPITAL SECURITY CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
TO EQUITABLE RESOURCES CAPITAL TRUST I OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CAPITAL SECURITY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF SUCH NOMINEE AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO SUCH ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO A PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, HAS AN INTEREST HEREIN.]
NO EMPLOYEE BENEFIT OR OTHER PLAN OR INDIVIDUAL RETIREMENT ACCOUNT
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") (EACH, A "PLAN"), NO ENTITY WHOSE UNDERLYING ASSETS INCLUDE
"PLAN ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY (A "PLAN ASSET
ENTITY"), AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN, MAY ACQUIRE OR HOLD
THIS CAPITAL SECURITIES CERTIFICATE OR ANY INTEREST HEREIN, UNLESS SUCH PURCHASE
AND HOLDING IS COVERED BY THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT
OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 96-23, 95-60, 91-38,
90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION WITH RESPECT TO SUCH PURCHASE AND
HOLDING AND, IN THE CASE OF ANY PURCHASER OR HOLDER RELYING ON ANY EXEMPTION
OTHER THAN PTCE 96-23, 95-60, 91-38, 90-1 OR 84-14, HAS COMPLIED WITH ANY
REQUEST BY THE DEPOSITOR OR THE ISSUER TRUST FOR AN OPINION OF COUNSEL OR OTHER
EVIDENCE WITH RESPECT TO THE APPLICABILITY OF SUCH EXEMPTION. ANY PURCHASER OR
HOLDER OF THE CAPITAL SECURITIES CERTIFICATE OR ANY INTEREST THEREIN WILL BE
DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING HEREOF THAT EITHER (A)
THE PURCHASER AND HOLDER ARE NOT A PLAN OR A PLAN ASSET ENTITY AND IS NOT
PURCHASING SUCH SECURITIES ON BEHALF OF OR WITH "PLAN ASSETS" OF ANY PLAN, OR
(B) THE PURCHASE AND HOLDING OF THE CAPITAL SECURITIES IS COVERED BY THE
EXEMPTIVE RELIEF PROVIDED BY PTCE 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER
APPLICABLE EXEMPTION.
<PAGE>
CERTIFICATE NUMBER NUMBER OF CAPITAL SECURITIES
1 5,000,000
$125,000,000 AGGREGATE LIQUIDATION AMOUNT
CUSIP NO. 294550207
CERTIFICATE EVIDENCING CAPITAL SECURITIES OF
EQUITABLE RESOURCES CAPITAL TRUST I
7.35% CAPITAL SECURITIES
(LIQUIDATION AMOUNT $25 PER CAPITAL SECURITY)
Equitable Resources Capital Trust I, a statutory business trust created
under the laws of the State of Delaware (the "Issuer Trust"), hereby certifies
that Cede & Co. (the "Holder") is the registered owner of $125,000,000 in
aggregate liquidation amount of capital securities of the Issuer Trust
representing a preferred undivided beneficial interest in the assets of the
Issuer Trust and designated the Equitable Resources Capital Trust I 7.35%
Capital Securities (liquidation amount $25 per Capital Security) (the "Capital
Securities"). The Capital Securities are transferable on the books and records
of the Issuer Trust, in person or by a duly authorized attorney, upon surrender
of this certificate duly endorsed and in proper form for transfer as provided in
Section 5.5 of the Trust Agreement (as defined below). The designations, rights,
privileges, restrictions, preferences and other terms and provisions of the
Capital Securities are set forth in, and this certificate and the Capital
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
Issuer Trust, dated as of April 23, 1998, as the same may be amended from time
to time (the "Trust Agreement"), among Equitable Resources, Inc., as Depositor,
Bankers Trust Company, as Property Trustee, Bankers Trust (Delaware), as
Delaware Trustee, two individuals selected by the holders of the Common
Securities to act as administrators with respect to the Issuer Trust (the
"Administrators") and the Holders of Trust Securities, including the designation
of the terms of the Capital Securities as set forth therein. The Holder is
entitled to the benefits of the Guarantee Agreement entered into by Equitable
Resources, Inc., a Pennsylvania corporation, and Bankers Trust Company, as
guarantee trustee, dated as of April 23, 1998 (the "Guarantee Agreement"), to
the extent provided therein. The Issuer Trust will furnish a copy of the Issuer
Trust Agreement and the Guarantee Agreement to the Holder without charge upon
written request to the Issuer 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.
Terms used but not defined herein have the meanings set forth in the
Trust Agreement.
IN WITNESS WHEREOF, one of the Administrators of the Issuer Trust has
executed this certificate this 23rd day of April, 1998.
EQUITABLE RESOURCES CAPITAL TRUST I
By:_________________________________________
Name: Jeffrey C. Swoveland
Administrator
AUTHENTICATED, COUNTERSIGNED AND REGISTERED:
BANKERS TRUST COMPANY, as Property Trustee
By:_________________________________________
Name:
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital
Security to:
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints ______________________________________________________
agent to transfer this Capital Security Certificate on the books of the Issuer
Trust. The agent may substitute another to act for him or her.
Date:______________ Signature:________________________________________________
(Sign exactly as your name appears on the other
side of this Capital Security Certificate)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
SEC Rule 17Ad-15.
<PAGE>
Exhibit E
[FORM OF EXPENSE AGREEMENT]
AGREEMENT AS TO EXPENSES AND LIABILITIES
AGREEMENT AS TO EXPENSES AND LIABILITIES, dated as of April 23, 1998,
between Equitable Resources, Inc., a Pennsylvania corporation, as Depositor (the
"Depositor"), and Equitable Resources Capital Trust I, a Delaware business trust
(the "Issuer Trust").
WHEREAS, the Issuer Trust intends to issue its Common Securities (the
"Common Securities") to and acquire Debentures from the Depositor, and to issue
and sell 7.35% Capital Securities, (the "Capital Securities") with such powers,
preferences and special rights and restrictions as are set forth in the Amended
and Restated Trust Agreement of the Issuer Trust, dated as of April 23, 1998,
among Equitable Resources, Inc., as Depositor, Bankers Trust Company, as
Property Trustee, Bankers Trust (Delaware), as Delaware Trustee, two individuals
selected by holders of the Common Securities to act as administrators with
respect to the Issuer Trust (the "Administrators"), and holders of the Trust
Securities, as the same may be amended from time to time (the "Trust
Agreement");
WHEREAS, the Depositor will own all of the Common Securities of the
Trust;
WHEREAS, capitalized terms used but not defined herein have the
meanings set forth in the Trust Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE I.
SECTION 1.1. Guarantee by the Depositor. Subject to the terms and
conditions hereof, the Depositor hereby irrevocably and unconditionally
guarantees to each person or entity to whom the Issuer Trust is now or hereafter
becomes indebted or liable (the "Beneficiaries") the full payment, when and as
due, of any and all Obligations (as hereinafter defined) to such Beneficiaries.
As used herein, "Obligations" means any costs, expenses or liabilities of the
Issuer Trust, other than obligations of the Issuer Trust to pay to holders of
any Trust Securities the amounts due such holders pursuant to the terms of the
Trust Securities. This Agreement is intended to be for the benefit of, and to be
enforceable by, all such Beneficiaries, whether or not such Beneficiaries have
received notice hereof.
Section 1.2. Subordination of Guarantee. The guarantee and other
liabilities and obligations of the Depositor under this Agreement shall
constitute unsecured obligations of the Depositor and shall rank subordinate and
junior in right of payment to all Senior Indebtedness (as defined in the
Indenture) of the Depositor to the extent and in the manner set forth in the
Indenture with respect to the Debentures, and the provisions of Article XIII of
the Indenture will apply, mutatis mutandis, to the obligations of the Depositor
hereunder. The obligations of the Depositor hereunder do not constitute Senior
Indebtedness (as defined in the Indenture) of the Depositor.
Section 1.3. Term of Agreement. This Agreement shall terminate and be of no
further force and effect upon the dissolution of the Issuer Trust, provided,
however, that this Agreement shall continue to be effective or shall be
reinstated, as the case may be, if at any time any holder of Capital Securities
or any Beneficiary must restore payment of any sums paid under the Capital
Securities, under any Obligation, under the Guarantee Agreement dated the date
hereof by the Depositor and Bankers Trust Company, as guarantee trustee, or
under this Agreement for any reason whatsoever. This Agreement is continuing,
irrevocable, unconditional and absolute.
Section 1.4. Waiver of Notice. The Depositor hereby waives notice of
acceptance of this Agreement and of any Obligation to which it applies or may
apply, and the Depositor hereby waives presentment, demand for payment, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands
Section 1.5. No Impairment. The obligations, covenants, agreements and
duties of the Depositor under this Agreement shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the extension of time for the payment by the Issuer Trust of all or any
portion of the Obligations or for the performance of any other obligation under,
arising out of, or in connection with, the Obligations;
(b) any failure, omission, delay or lack of diligence on the part of the
Beneficiaries to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Beneficiaries with respect to the Obligations or any
action on the part of the Issuer Trust granting indulgence or extension of any
kind; or
(c) 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 Trust or any of the assets of
the Issuer Trust (other than the dissolution of the Issuer Trust in accordance
with the terms thereof).
There shall be no obligation of the Beneficiaries to give notice to, or
obtain the consent of, the Depositor with respect to the happening or any of the
foregoing.
Section 1.6. Enforcement. A Beneficiary may enforce this Agreement directly
against the Depositor and the Depositor waives any right or remedy to require
that any action be brought against the Issuer Trust or any other person or
entity before proceeding against the Depositor.
Section 1.7. Subrogation. The Depositor shall be subrogated to all rights
(if any) of any Beneficiary against the Issuer Trust in respect of any amounts
paid to the Beneficiaries by the Depositor under this Agreement; provided,
however, that the Depositor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any rights that
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Agreement, if, at the
time of any such payment, any amounts are due and unpaid under this Agreement or
any payments are due to the holders of Capital Securities under the Trust
Agreement.
ARTICLE II.
SECTION 2.1. Assignment. This Agreement may not be assigned by either party
hereto without the consent of the other, and any purported assignment without
such consent shall be void; except that upon any transfer of the Common
Securities, this Agreement shall be assigned and delegated by the Depositor to
its successor with such transfer without any action by either party hereto.
Section 2.2. Binding Effect. All guarantees and agreements contained in
this Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Depositor and shall inure to the benefit of the
Beneficiaries.
Section 2.3. Amendment. So long as there remains any Beneficiary or any
Capital Securities are outstanding, this Agreement shall not be modified or
amended in any manner adverse to such Beneficiary or to the holders of the
Capital Securities without the consent of such Beneficiary or the holders of the
Capital Securities, as the case may be.
Section 2.4. Notices. Any notice, request or other communication required
or permitted to be given hereunder shall be given in writing by delivering the
same against receipt therefor by facsimile transmission (confirmed by mail),
telex or by registered or certified mail, addressed as follows (and if so given,
shall be deemed given when mailed or upon receipt of an answer-back, if sent by
telex):
Equitable Resources Capital Trust I
c/o Bankers Trust Company
Four Albany Street
New York, New York 10006
Attention: Corporate Trust and Agency Group
With a copy to:
Equitable Resources, Inc.
420 Boulevard of the Allies
Pittsburgh, Pennsylvania 15219
Attention: Secretary
Section 2.5. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THIS AGREEMENT is executed as of the day and year first above written.
EQUITABLE RESOURCES, INC.
By:_______________________________________
Name:
Title:
EQUITABLE RESOURCES CAPITAL TRUST I
By:_______________________________________
Name:
Administrator
EQUITABLE RESOURCES, INC.
7.35% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
CUSIP: 294549 AF7
No. 1 $128,866,000
EQUITABLE RESOURCES, INC., a corporation organized and existing under
the laws of the Commonwealth of Pennsylvania (hereinafter called the
"Corporation", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay Bankers
Trust Company, as Property Trustee (the "Property Trustee," which term includes
any successor Property Trustee for Equitable Resources Capital Trust I) for
Equitable Resources Capital Trust I, a statutory business trust formed under the
laws of the State of Delaware (hereinafter called the "Issuer Trust"), or
registered assignees, the principal sum of One Hundred Twenty Eight Million
Eight Hundred Sixty Six Thousand Dollars on April 15, 2038; provided that the
Corporation may advance such date to a date not earlier than April 15, 2013 (the
"Stated Maturity") in accordance with the Indenture. The Corporation further
promises to pay interest on said principal sum from and including April 23, 1998
or from the most recent Interest Payment Date (as defined below) to which
interest has been paid or duly provided for, quarterly (subject to deferral as
set forth herein) in arrears on January 15, April 15, July 15 and October 15 of
each year (each, an "Interest Payment Date"), commencing July 15, 1998 at the
rate of 7.35% per annum, together with Additional Sums, if any, as provided in
Section 10.6 of the Indenture (as defined herein), until the principal hereof
has been paid or duly provided for or made available for payment; provided that
any overdue principal, premium or Additional Sums and any overdue installment of
interest shall bear Additional Interest at the rate of 7.35% per annum (to the
extent that the payment of such interest shall be legally enforceable),
compounded quarterly, from the dates such amounts are due until they are paid or
made available for payment, and such interest shall be payable on demand.
Notwithstanding the foregoing, if any Interest Payment Date is not a Business
Day, then payment of interest or principal or other amounts shall be made on the
next succeeding Business Day (and no interest shall accrue in respect of the
amounts whose payment is so delayed) except that, if such Business Day is in the
next succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the date such payment was originally payable. The amount of interest payable
for any period less than a full interest period shall be computed on the basis
of a 360-day year of twelve 30-day months and the actual days elapsed in a
partial month in such period. The amount of interest payable for any full
interest period shall be computed by dividing the applicable rate per annum by
four. The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the 1st day of January, April, July or
October (whether or not a Business Day) next preceding such Interest Payment
Date (each such date a "Regular Record Date"). Any such interest not so
punctually paid or duly provided for shall forthwith cease to be payable to the
Holder on such Regular Record Date and may either be paid to the Person in whose
name this Security (or one or more Predecessor Securities) is registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest to be fixed by the Trustee, notice whereof shall be given to Holders of
Securities of this series not less than 10 days prior to such Special Record
Date, or be paid at any time in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Securities of this
series may be listed, and upon such notice as may be required by such exchange,
all as more fully provided in said Indenture. The term "interest" as used herein
includes quarterly interest payments, interest on quarterly interest payments
not paid on the applicable Interest Payment Date and Additional Sums, as
applicable. As used herein, "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 or
the City of Pittsburgh, Pennsylvania are authorized or required by law or
executive order to remain closed, or (c) a day on which the corporate trust
office of the Property Trustee is closed for business.
So long as no Event of Default has occurred and is continuing, the
Corporation shall have the right, at any time during the term of this Security,
from time to time to defer the payment of interest on this Security for up to 20
consecutive quarterly interest payment periods with respect to each deferral
period (each an "Extension Period"), at the end of which the Corporation shall
pay all interest then accrued and unpaid including any Additional Interest, as
provided below; provided, however, that no Extension Period shall extend beyond
the Stated Maturity of the principal of this Security, as then in effect, and no
such Extension Period may end on a date other than an Interest Payment Date. In
the event that the Stated Maturity is advanced to a date prior to the end of an
Extension Period, such Extension Period shall be deemed to end on such date or
such earlier date as may be determined by the Company. In the event that any
Securities are called for redemption on the date prior to the end of an
Extension Period, with respect to such Securities, such Extension Period shall
be deemed to end on such date or such earlier date as may be determined by the
Company. During any such Extension Period, the Corporation shall not (i) declare
or pay any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Corporation's capital stock, or
(ii) make any payment of principal of or interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Corporation that rank
pari passu in all respects with or junior in interest to this Security (other
than (a) repurchases, redemptions or other acquisitions of shares of capital
stock of the Corporation (1) in connection with any employment contract, benefit
plan or other similar arrangement with or for the benefit of any one or more
employees, officers, directors or consultants, (2) in connection with a dividend
reinvestment or stockholder stock purchase plan or (3) in connection with the
issuance of capital stock of the Corporation (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a
result of an exchange or conversion of any class or series of the Corporation's
capital stock (or any capital stock of a Subsidiary of the Corporation) for any
class or series of the Corporation's capital stock or of any class or series of
the Corporation's indebtedness for any class or series of the Corporation's
capital stock, (c) the purchase of fractional interests in shares of the
Corporation's capital stock pursuant to the conversion or exchange provisions of
such capital stock or the security being converted or exchanged, (d) any
declaration of a dividend in connection with any Rights Plan, or the issuance of
rights, stock or other property under any Rights Plan, or the redemption or
repurchase of rights pursuant thereto, (e) payments under the Guarantee executed
and delivered by the Corporation and Bankers Trust Company, as trustee, for the
benefit of the holders of any Capital Securities (as defined in the Trust
Agreement), as amended from time to time (the "Guarantee") or (f) any dividend
in the form of stock, warrants, options or other rights where the dividend stock
or the stock issuable upon exercise of such warrants, options or other rights is
the same stock as that on which the dividend is being paid or ranks pari passu
with or junior to such stock). Prior to the termination of any such Extension
Period, the Corporation may further defer the payment of interest, provided that
no Extension Period shall exceed 20 consecutive quarterly interest payment
periods, extend beyond the Stated Maturity of the principal of this Security or
end on a date other than an Interest Payment Date. Upon the termination of any
such Extension Period and upon the payment of all accrued and unpaid interest
and any Additional Interest then due on any Interest Payment Date, the
Corporation may elect to begin a new Extension Period, subject to the above
conditions. No interest shall be due and payable during an Extension Period,
except at the end thereof, but each installment of interest that would otherwise
have been due and payable during such Extension shall bear Additional Interest
(to the extent that the payment of such interest shall be legally enforceable)
at the rate of 7.35% per annum, compounded quarterly and calculated as set forth
in the first paragraph of this Security, from the dates on which amounts would
otherwise have been due and payable until paid or made available for payment.
The Corporation shall give the Holder of this Security and the Trustee
notice of its election to begin any Extension Period at least one Business Day
prior to the earlier of (i) the date the Distributions on the Capital Securities
of such Issuer Trust would have been payable but for the election to begin such
Extension Period, and (ii) the date on which the Property Trustee of such Issuer
Trust is required to give notice to any holders of such Capital Securities of
the record date or the date such Distributions are payable, but in any event not
less than one Business Day prior to such record date.
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Corporation maintained for
that purpose in New York, New York, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts.
The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and junior in right of payment to the prior
payment in full of all Senior Indebtedness, and this Security is issued subject
to the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take
such actions as may be necessary or appropriate to effectuate the subordination
so provided, and (c) appoints the Trustee his or her attorney-in-fact for any
and all such purposes. Each Holder hereof, by his or her acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon
said provisions.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this instrument to be
duly executed under its corporate seal.
Dated: April 23, 1998
EQUITABLE RESOURCES, INC.
By:__________________________________________________
Name: Jeffrey C. Swoveland
Title: Vice President - Finance and Treasurer
Attest:
- ---------------------------------
Name: Audrey C. Moeller
Title: Vice President and Corporate
Secretary
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.
Dated: April 23, 1998
BANKERS TRUST COMPANY, as Trustee
By:__________________________________________________
Authorized Officer
<PAGE>
[Reverse of Security]
This Security is one of a duly authorized issue of 7.35% Junior
Subordinated Debentures due April 15, 2038 of the Corporation (herein called the
"Securities"), issued and to be issued in one or more series under the Junior
Subordinated Indenture, dated as of April 23, 1998 (hereinafter called the
"Indenture"), between the Corporation and Bankers Trust Company, as Trustee
(herein called the "Trustee", which term includes any successor trustee under
the Indenture), to which the Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Corporation, the Trustee, the
holders of Senior Indebtedness and the Holders of the Securities, and of the
terms upon which the Securities are, and are to be, authenticated and delivered.
This Security is one of the series designated on the face hereof limited in
aggregate principal amount to $128,866,000. The Corporation has appointed
Bankers Trust Company at its corporate trust office in The City of New York as
the paying agent (the "Paying Agent," which term includes any additional or
successor Paying Agent appointed by the Corporation) with respect to the
Securities.
To the extent not inconsistent herewith, the terms of the Indenture are
hereby incorporated by reference herein. All terms used in this Security that
are defined in the Indenture or in the Amended and Restated Trust Agreement,
dated as of April 23, 1998 (as modified, amended or supplemented from time to
time, the "Trust Agreement"), relating to the Issuer Trust, among the
Corporation, as Depositor, and the Trustees named therein, shall have the
meanings assigned to them in the Indenture or the Trust Agreement, as the case
may be.
This Security will not be subject to any sinking fund and, except as
provided in the Indenture, will not be redeemable or subject to repayment at the
option of the holder prior to its Stated Maturity.
The Corporation may redeem this Security at any time, at its option,
and subject to the terms and conditions of Article XI of the Indenture, (i) on
or after April 23, 2003, in whole at any time or in part from time to time, and
(ii) prior to April 23, 2003, in whole (but not in part) at any time within 90
days following the occurrence and continuation of a Tax Event or an Investment
Company Event (the "90-Day Period"), in each case at a Redemption Price equal to
the accrued and unpaid interest on this Security to the date fixed for
redemption, plus 100% of the principal amount hereof; provided, however that if
at the time there is available to the Company or the Issuer Trust the
opportunity to eliminate, within the 90-Day Period, the Tax Event or Investment
Company Event by taking some ministerial action ("Ministerial Action"), such as
filing a form or making an election, or pursuing some other similar reasonable
measure that will have no adverse effect on the Company, the Issuer Trust or the
holders of the Trust Securities and will involve no material cost, the Company
shall pursue such measures in lieu of redemption; provided, further, that the
Company shall have no right to redeem the Securities while the Issuer Trust is
pursuing any Ministerial Action pursuant to the Trust Agreement..
Notice of redemption shall be mailed to the registered holders of the
Securities designated for redemption at their addresses as the same shall appear
on the Security register not less than 30 nor more than 60 days prior to the
dated fixed for redemption, subject to all conditions and provisions of the
Indenture. In the event of redemption of this Security in part only, a new
Security or Securities of this series for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.
The Indenture contains provisions for satisfaction and discharge of the
entire indebtedness of this Security upon compliance by the Corporation with
certain conditions set forth in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
Corporation and the Trustee at any time to enter into a supplemental indenture
or indentures for the purpose of modifying in any manner the rights and
obligations of the Corporation and of the Holders of the Securities, with the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities of each series to be affected by such supplemental
indenture. The Indenture also contains provisions permitting Holders of
specified percentages in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such series,
to waive compliance by the Corporation with certain provisions of the Indenture
and certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive an binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.
As provided in and subject to the provisions of the Indenture, if an
Event of Default with respect to the Securities of this 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% in aggregate principal amount of the
Outstanding Securities of this series may declare the principal amount of all
the Securities of this series and interest accrued thereon to be due and payable
immediately, by a notice in writing to the Corporation (and to the Trustee if
given by Holders); provided that, if upon an Event of Default, the Trustee or
such Holders fail to declare the principal of all the Outstanding Securities of
this series to be immediately due and payable, the holders of at least 25% in
aggregate Liquidation Amount of the Capital Securities then Outstanding shall
have the right to make such declaration by a notice in writing to the
Corporation and the Trustee; and upon any such declaration the principal amount
of and the accrued interest (including any Additional Interest) on all the
Securities of this series shall become immediately due and payable, provided
that the payment of principal and interest (including any Additional Interest)
on such Securities shall remain subordinated to the extent provided in Article
XIII of the Indenture.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Corporation,
which is absolute and unconditional, to pay the principal of (and premium, if
any) and interest (including any Additional Interest) on this Security at the
times, place and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Securities
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Corporation maintained under Section 10.2 of the
Indenture for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Corporation and the
Securities Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Securities of
this series, of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $25 and any integral multiple of $25 in
excess thereof. As provided in the Indenture and subject to certain limitations
therein set forth, Securities of this series are exchangeable for a like
aggregate principal amount of Securities of this series and of like tenor of a
different authorized denomination, as requested by the Holder surrendering the
same.
No service charge shall be made for any such registration of transfer
or exchange, but the Corporation may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the Person in whose name this Security is registered as the owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Corporation, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Corporation and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agree that for United States Federal, state and local
tax purposes it is intended that this Security constitute indebtedness.
THIS SECURITY SHALL FOR ALL PURPOSES BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Exhibit 10.1
EMPLOYMENT AGREEMENT ADDENDUM NO. 2
WHEREAS, Donald I. Moritz ("Employee") and Equitable Resources, Inc.
(the "Company") entered into an Employment Agreement dated August 1, 1997 (the
"Employment Agreement").
NOW, THEREFORE, in consideration of the foregoing premises, the
covenants herein contained, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. The Employment Agreement shall terminate effective May 31, 1998 (the
"Termination Date"), and the parties shall have no further obligations
thereunder except for payment by the Company of salary accrued to the
Termination Date.
2. Notwithstanding the foregoing, the Employee's obligations under
Paragraph 5 of the Employment Agreement shall survive termination thereof.
IN WITNESS WHEREOF, the parties have executed this agreement as of this
29th day of May, 1998.
ATTEST: EQUITABLE RESOURCES, INC.
/s/ Audrey C. Moeller /s/ G. R. Spencer
______________________________________ By: ___________________________________
Vice President and Corporate Secretary Its: Gregory R. Spencer
Sr. V.P. & Chief
Administrative Officer
WITNESS: EMPLOYEE
/s/ Janice A. Haas /s/ Donald I. Moritz
__________________________________ By: ___________________________________
Donald I. Moritz
Exhibit 10.2
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") dated as of the
4th day of May 1998 (the "Effective Date") is between Equitable Resources, Inc.,
a Pennsylvania corporation, with its principal executive offices at 420
Boulevard of the Allies, Pittsburgh, Pennsylvania 15219 (the "Company"), and
Murry S. Gerber, an individual and resident of Bellaire, Texas (the
"Executive").
WHEREAS, the Company desires to secure the employment of the
Executive in accordance with the provisions of the Agreement; and
WHEREAS, the Executive desires and is willing to accept
employment with the Company in accordance herewith.
NOW, THEREFORE, in consideration of the mutual covenants
herein contained and intending to be legally bound, the Company and the
Executive hereby agree as follows:
Section 1. Position and Duties.
(a) The Company hereby agrees to employ the Executive for the
term of this Agreement to render services to the Company as President and Chief
Executive Officer of the Company and to perform those duties commensurate with
such position, as the Board of Directors may reasonably direct. Further, the
Executive will be elected by the Board of Directors as a Class III Director
whose term will expire in the year 2001.
(b) The Executive hereby accepts such employment and agrees
faithfully to perform to the best of his ability and on a full-time basis the
duties described in Section l(a). The Executive further agrees that promptly
after the execution of this Agreement, he shall move his primary residence to
the Pittsburgh, Pennsylvania area
Section 2. Term of Employment Agreement.
(a) Term. The term of this Agreement shall commence on the Effective
Date and shall terminate on the last day of the 36th calendar month after the
Effective Date, unless automatically extended as follows: commencing on the last
day of the first full calendar month after the second anniversary of the
Effective Date and on the last day of each succeeding calendar month, the term
of this Agreement shall be automatically extended without further action by
either party (but not beyond the Executive's 65th birthday) for one additional
calendar month unless one party notifies the other in writing that such party
does not wish to extend the term of this Agreement. In the event that such
notice shall have been delivered, the term hereof shall no longer be subject to
automatic extension and the term hereof shall expire on the date which is 12
calendar months after the last day of the month in which such written notice is
received. The last day of the calendar month in which the term hereof, as such
may be extended from time to time, shall end is hereinafter referred to as the
"Expiration Date".
(b) Termination of Employment. If the Executive's Termination of
Employment Date (as defined below) is prior to the Expiration Date, this
Agreement shall terminate on the Termination of Employment Date , subject to the
provisions of Section 8 hereof. For purposes of this Agreement, the Executive's
Termination of Employment Date shall be the earliest to occur of the following
events:
(i) if the Executive's employment is terminated for Disability, as
defined in Paragraph 8(b), the date which is thirty days after Notice
of Termination is given following expiration of the Disability Period
(provided that the Executive shall not have returned to the performance
of the Executive's duties on a full-time daily basis during such
period),
(ii) if the Executive's employment is terminated on account of his
death, the Executive's date of death, and
(iii) if the Executive's employment is terminated for any other reason,
the date specified in the Notice of Termination (which shall not be
less than 30 days nor more than 60 days, from the date such Notice of
Termination is given).
For purposes of this Agreement, a "Notice of Termination" shall mean a
Notice which shall specify the date of termination and shall identify
the basis therefor.
The Company reserves the right to terminate the Executive's employment
for any reason not prohibited by law; provided, however, that any such removal
shall be without prejudice to any rights the Executive may have to benefits
under this Agreement or the Agreements described in Appendix A, B and C.
Section 3. Compensation and Benefits.
The Executive shall be entitled to receive the following compensation and
benefits under this Agreement:
(a) The Executive shall receive Inducement Benefits as set
forth in Section 4 of this Agreement;
(b) The Executive shall receive base salary as set forth in
Section 5 of this Agreement;
(c) The Executive shall be eligible for bonus and incentive
benefits as described in Section 6 of this Agreement;
(d) The Executive shall be entitled to employee benefits as
described in Section 7 of this Agreement;
(e) The Executive shall be entitled to Change of Control
benefits as set forth in the Change of Control Agreement which is attached to
this Agreement as Appendix A; and
(f) The Executive shall be entitled to post-termination
benefits under the Post-Termination Confidentiality/Noncompete Agreement which
is attached to this Agreement as Appendix B.
Nothing contained in this Agreement shall prevent the Company from
amending or otherwise altering the benefit plans and agreements described below
so long as such amendment or alteration equitably affects all employees,
executive or otherwise, previously covered thereunder.
Section 4. Inducement Benefits.
(a) Signing Bonus. The Executive will receive a bonus payment
in the amount of $300,000 from the Company on his first day of employment with
the Company. This amount must be repaid to the Company if the Executive's
Termination from Employment Date is on or before March 31, 1999.
(b) Supplemental Retirement Benefit. The Company agrees to
provide a supplemental retirement type benefit to the Executive in recognition
that the Executive has foregone certain retirement benefits by leaving his prior
employer before his retirement date. The amount of the benefit shall be
determined under the terms of the Supplemental Retirement Agreement attached
hereto as Appendix C.
Section 5. Compensation.
The Company shall pay the Executive a base salary of $500,000 per year. This
base amount shall be reviewed by the Compensation Committee of the Board of
Directors on an annual basis and will be adjusted taking into consideration both
individual performance and competitive position relative to the Company's peer
group.
Section 6. Bonus and Incentive Benefits.
The Executive shall be eligible to participate in the following bonus and
incentive benefit programs of the Company:
(a) Short Term Incentive Benefits. The Executive shall be
entitled to an annual incentive compensation payment equal to the amount, if
any, payable to the Executive under the terms and conditions of the Company's
Short-Term Incentive Compensation Plan as in effect for each annual period
during the term of this Agreement; except that for the 1998 year, the
Executive's bonus amount as described in this paragraph, if any, shall be
reduced by the amount of the Executive's signing bonus as described in Agreement
Section 4(a);
(b) Long-Term Incentive Benefits. The Executive shall
participate in the Company's 1994 Long-Term Incentive Plan or any successor plan
(the "Long-Term Incentive Plan"). Under the Long-Term Incentive Plan, the
Executive will be credited with benefits which shall be subject to the terms and
conditions of the Long-Term Incentive Plan and programs thereunder, except as
otherwise specifically provided below, and shall include the following:
(i) The Executive will receive a grant of 15,000
shares of Company stock which shall vest in one-third increments with the
first third vesting on the first anniversary of the Effective Date, the
second third vesting on the second anniversary of the Effective Date, and
the final third vesting on the third anniversary of the Effective Date. Also,
the Executive will receive a cash payment on each of the three vesting dates
equivalent to the federal, FICA, state and local taxes payable relative to
the grant as determined by the Company.
(ii) The Executive will receive options to purchase
150,000 shares of Company stock. These options will also vest in one-third
increments with the first third vesting on the first anniversary of the
Effective Date, the second third vesting on the second anniversary of the
Effective Date, and the final third vesting on the third anniversary of the
Effective Date. The strike price for all of the options will be set on the
Effective Date and will be the Fair Market Value on the Effective Date as
defined in the Long-Term Incentive Plan. The exercise period shall be four
years from the date of vesting.
(iii) The Executive shall be eligible to receive
additional stock option grants under the Company's Long-Term Incentive Plan.
For the 1998 plan year, and each of the following four plan years, the Executive
will be granted options to purchase no less than 60,000 shares.
Section 7. Other Benefits.
(a) Employee Benefits. The Executive shall participate on the
same terms and conditions as all other corporate employees in all employee
benefit plans, as may be now or hereafter sponsored or maintained for all
corporate employees of the Company and participation on the same terms and
conditions as other executive officers in such other plan, program or
arrangement as may be now or hereafter sponsored or maintained for executive
officers of the Company. The Executive will be entitled to four weeks of
vacation per year subject to the terms and conditions of the Company's policies.
(b) Executive Life Insurance Benefits. The Executive shall be
provided with the following life insurance benefits:
(i) In addition to the life insurance benefits
provided under the corporate employee benefit plans (currently one times annual
base salary), the Executive shall receive life insurance benefits which shall
provide a death benefit equal to an additional two-times the Executive's annual
base salary; and
(ii) The Company shall fund the purchase of a
second-to-die split dollar life insurance policy on the joint lives of the
Executive and his spouse. The policy shall provide a two million dollar death
benefit and shall be subject to a Split Dollar Agreement.
(c) Perquisites. Subject to the reasonable approval of the
Company, the Executive shall be entitled to the following Executive perquisites:
(i) One country club membership;
(ii) One dining club membership;
(iii) The use of a car or a monthly car allowance
of $765; and
(iv) Financial, estate and tax planning services
Any bond or bond equivalent purchased by the Company in
connection with the provision of club memberships shall at all times be in the
name and ownership of the Company.
(d) Relocation. Relocation benefits will be provided to the
Executive as detailed in the Offer of Employment document provided by the
Company.
(e) Expenses. The Executive shall be reimbursed for reasonable
travel and other expenses incurred by Executive in performing his obligations
hereunder pursuant to the terms and conditions of the Company's policy in
respect thereto. In addition, the Executive will be reimbursed for reasonable
legal expenses in connection with the review of this document and all other
initial employment related documents.
Section 8. Benefits Upon Termination of Employment.
(a) Involuntary Termination without Cause. If the Executive's
employment with the Company terminates prior to the Expiration Date on account
of an involuntary termination of employment by the Company without Cause, or by
voluntary termination within 90 days of a material breach by the Company of the
Agreement, the Executive shall receive his base salary compensation as described
in Section 5 hereof until the Expiration Date and no additional benefits other
than those accrued hereunder and under the Company's employee benefit plans up
to the Termination of Employment Date.
(b) Other Terminations of Employment. If the Executive's
employment with the Company terminates on the Expiration Date, or on account of
the Executive's (i) death, (ii) Disability, (iii) termination for Cause, or (iv)
voluntary termination, the Executive will receive no additional benefits under
this Agreement other than those accrued hereunder and under the Company's
employee benefit plans up to the Termination of Employment Date.
For purposes of this Agreement, the term "Disability" means
the occurrence of a physical or mental condition of the Executive which, in the
judgment of the Board of Directors of the Company, prevents the Executive from
performing his duties on a full time basis for a period of 90 consecutive days
("Disability Period").
For purposes of this Agreement, "Cause" shall include: (i) the
conviction of a felony, a crime of moral turpitude or fraud or having committed
fraud, misappropriation or embezzlement in connection with the performance his
duties hereunder, (ii) willful and repeated failures to substantially perform
his assigned duties; or (iii) a material violation of any other provisions of
this Agreement or express significant policies of the Company.
(c) Sole Right of Recourse. In the event the Executive's
employment is terminated, the Executive agrees that his sole right against the
Company with respect to his employment or the termination thereof shall consist
of his rights to benefits as described in this Section 8 and as set forth in
other Agreements entered into between the Company and the Executive, employee
benefit programs and any indemnification with respect to third party actions
under the Company By-Laws.
(d) Executive's Duty to Mitigate. The Executive shall not be
required to mitigate the amount of any payment provided for in this Section by
seeking other employment or otherwise, nor shall the amount of any payment
provided for in this Section be reduced by any compensation earned by the
Executive as the result of employment by another employer, or otherwise.
(e) Coordination With Other Agreements. If the Executive is
entitled to benefits under the Change of Control Agreement (as set forth in
Appendix A hereto) following his termination of employment, then its terms shall
control and he shall not receive the base salary compensation benefits provided
under paragraph (a) of this Section 8. The base salary compensation amount
payable to the Executive under paragraph (a) of this Section 8 shall be reduced
by the 24-month annual base salary payment provided in Section 3 of the
Post-Termination Confidentiality and Non-Competition Agreement.
Section 9. Arbitration.
Any disputes hereunder shall be settled by arbitration in Pittsburgh,
Pennsylvania under the auspices of, and in accordance with the rules of, the
American Arbitration Association, and the decision in such arbitration shall be
final and conclusive on the parties and judgment upon such decision may be
entered in any court having jurisdiction thereof. The prevailing party may
recover from the other the costs and expenses, including reasonable attorneys'
fees, if any, incurred in conjunction therewith.
Section 10. Notices.
All notices and other communications which are required or may be given under
this Agreement shall be in writing and shall be delivered personally or by
registered or certified mail addressed to the party concerned at the following
addresses:
If to the Company:
Equitable Resources, Inc.
420 Boulevard of Allies
Pittsburgh, PA 15219
Attn: Corporate Secretary
If to the Executive:
Mr. Murry S. Gerber
c/o Robert B. Williams, Esq.
Williams Coulson, LLC Suite 1500
Two Chatham Center
Pittsburgh, PA 15219
or to such other address as shall be designated by notice in writing to the
other party in accordance herewith. Notices and other communications hereunder
shall be deemed effectively given when personally delivered, or, if mailed, 48
hours after deposit in the United States mail.
Section 11. Assignment.
This Agreement shall inure to the benefit of and be binding upon the respective
legal representatives, successors, and assigns of the parties hereto. However,
the relationship contemplated by this Agreement is unique and personal, and any
assignment of this Agreement by the Executive without the consent of the Company
shall be void. Notwithstanding the preceding sentence, the Company may assign
its rights and obligations hereunder to any corporation or other business
organization with which the Company may merge or consolidate, or to which it may
transfer substantially all its assets or otherwise enter into an acquisition or
reorganization transaction.
Section 12. Governing Law.
This Agreement shall be governed by and construed in accordance with the laws of
the Commonwealth of Pennsylvania.
Section 13. Miscellaneous.
(a) This Agreement and its appendices as executed supersede
all prior agreements, arrangements and undertakings, written or oral, relating
to the subject matter hereof.
(b) This arrangement shall inure to the benefit of the
Executive's heirs, representatives or estate to the extent stated herein.
(c) This Agreement may be amended, modified, superseded,
canceled, renewed or extended and the terms or covenants hereof may be waived,
only by a written instrument executed by both of the parties hereto, or in the
case of a waiver, by the party waiving compliance. The failure of either party
at any time or times to require performance of any provisions hereof shall in no
manner affect the right at a later time to enforce such provisions thereafter.
No waiver by either party of the breach of any term or covenant contained in
this Agreement, whether by conduct or otherwise, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of any
such breach or a waiver of the breach of any other term or covenant contained in
this Agreement.
(d) In the event any one or more of the covenants, terms or
provisions contained in this Agreement shall be invalid, illegal or
unenforceable in any respect, the validity of the remaining covenants, terms and
provisions contained herein shall be in no way affected, prejudiced or disturbed
thereby.
(e) The Executive represents that he has no obligations under
any other agreement which would conflict or interfere in any way with the
services to be rendered hereunder.
(f) The Company and the Executive agree that the termination
of this Agreement shall not cause, by itself, the termination of any of the
agreements referenced as appendices or any other employee benefit plan
maintained by the Company which shall be governed by their terms.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed and delivered.
ATTEST: EQUITABLE RESOURCES, INC.
By: /s/ Audrey C. Moeller /s/ Donald I. Moritz
______________________________________ By: ________________________________
Audrey C. Moeller Donald I. Moritz
Vice President and Corporate Secretary President and
Chief Executive Officer
WITNESS:
By: /s/ G. R. Spencer /s/ M. S. Gerber
_______________________________________ ________________________________
Murry S. Gerber
Exhibit 10.3
CHANGE OF CONTROL AGREEMENT
THIS AGREEMENT (the "Agreement") dated as of the 4th day of May,
1998 (the "Effective Date") by and between EQUITABLE RESOURCES, INC., a
Pennsylvania corporation with its principal place of business at Pittsburgh,
Pennsylvania (the "Company"), and MURRY S. GERBER, an individual and resident of
Bellaire, Texas (the "Employee");
WHEREAS, the Board of Directors of the Company (the "Board"), has
determined that it is in the best interest of the Company and its shareholders
to assure that the Company will have the continued dedication of the Employee,
notwithstanding the possibility, threat or occurrence of a Change of Control (as
defined below) of the Company. The Board believes it is imperative to diminish
the inevitable distraction of the Employee by virtue of the personal
uncertainties and risks created by a pending or threatened Change of Control and
to encourage the Employee's full attention and dedication to the Company
currently and in the event of any threatened or pending Change of Control, and
to provide the Employee with compensation and benefits arrangements upon a
Change of Control which ensure that the compensation and benefits expectations
of the Employee will be satisfied and which are competitive with those of other
corporations in the industry in which the Company's principal business activity
is conducted. Therefore, in order to accomplish these objectives, the Board has
caused the Company to enter into this Agreement.
NOW THEREFORE, in consideration of the premises and mutual
covenants contained herein, and intending to be legally bound hereby, the
parties hereto agree as follows:
Section 1. Term.
The term of this Agreement shall commence on the Effective Date hereof and shall
terminate on the last day of the 36th calendar month after the Effective Date,
unless automatically extended as follows: commencing on the last day of the
first full calendar month after the Effective Date and on the last day of each
succeeding calendar month, the term of this Agreement shall be automatically
extended without further action by either party (but not beyond the Executive's
65th birthday) for one additional calendar month unless one party notifies the
other in writing that such party does not wish to extend the term of this
Agreement. In the event that such notice shall have been delivered, the term
hereof shall no longer be subject to automatic extension and the term hereof
shall expire on the date which is 36 calendar months after the last day of the
month in which such written notice is received. The last day of the calendar
month in which the term hereof, as may be extended from time to time, shall end
is hereinafter referred to as the "Expiration Date". Notwithstanding the
foregoing, the Employee shall serve in said office(s) at the pleasure of the
Board, and the Employee may be removed from said office(s) at any time with or
without Cause (as hereinafter defined); provided, that such removal shall be
without prejudice to any rights the Employee may have to Salary and Benefits
Continuation (as hereinafter defined) hereunder. Section 2. Change of Control.
Change of Control shall mean any of the following events (each of such events
being herein referred to as a "Change of Control"):
(a) The sale or other disposition by the Company of all or
substantially all of its assets to a single purchaser or to a
group of purchasers, other than to a corporation with respect to
which, following such sale or disposition, more than eighty
percent (80%) of, respectively, the then outstanding shares of
Company common stock and the combined voting power of the then
outstanding voting securities entitled to vote generally in the
election of the Board of Directors is then owned beneficially,
directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners,
respectively, of the outstanding Company common stock and the
combined voting power of the then outstanding voting securities
immediately prior to such sale or disposition in substantially
the same proportion as their ownership of the outstanding Company
common stock and voting power immediately prior to such sale or
disposition;
(b) The acquisition in one or more transactions by any
person or group, directly or indirectly, of beneficial ownership
of twenty percent (20%) or more of the outstanding shares of
Company common stock or the combined voting power of the then
outstanding voting securities of the Company entitled to vote
generally in the election of the Board of Directors; provided,
however, that any acquisition by (x) the Company or any of its
subsidiaries, or any employee benefit plan (or related trust)
sponsored or maintained by the Company or any of its subsidiaries
or (y) any person that is eligible, pursuant to Rule 13d-1(b)
under the Exchange Act (as such rule is in effect as of November
1, 1995), to file a statement on Schedule 13G with respect to its
beneficial ownership of Company common stock and other voting
securities whether or not such person shall have filed a
statement on Schedule 13G, unless such person shall have filed a
statement on Schedule 13D with respect to beneficial ownership of
fifteen percent (15%) or more of the Company's voting securities,
shall not constitute a Change of Control;
(c) The Company's termination of its business and
liquidation of its assets;
(d) The reorganization, merger or consolidation of the
Company into or with another person or entity, by which
reorganization, merger or consolidation the persons who held one
hundred percent (100%) of the voting securities of the Company
prior to such reorganization, merger or consolidation receive or
continue to hold less than sixty percent (60%) of the outstanding
voting shares of the new or continuing corporation; or
(e) If, during any two-year period, less than a majority
of the members of the Board of Directors are persons who were
either (i) nominated or recommended for election by at least
two-thirds vote of the persons who were members of the Board of
Directors or Nominating Committee of the Board of Directors at
the beginning of the period, or (ii) elected by at least a
two-thirds vote of the persons who were members of the Board of
Directors at the beginning of the period.
Section 3. Salary and Benefits Continuation.
"Salary and Benefits Continuation" shall be defined to mean the following: (i)
payment of sum equal to Employee's base salary for a twelve (12) month period;
(ii) payment of an amount of cash equal to three (3) times the average
Short-Term Incentive Compensation Plan Benefit (as defined in the Employment
Agreement) earned over the prior three year period; (iii) immediate vesting of
all previously unvested stock options and grants; (iv) immediate delivery of an
amount of cash equal to three (3) times the average value (measured as the
difference between the applicable strike price and the Fair Market Value as
defined in the Company's Long-Term Incentive Plan on the date the change in
control is consummated) of the average number of stock options granted to
Employee over the preceding three (3) years under the applicable Company
Long-Term Incentive Plan; (v) provision to Employee and his eligible dependents
of medical, disability, dental and life insurance coverage (to the extent such
coverage was in effect immediately prior to the Change of Control) for 36
months; and (vi) reimbursement to Employee of reasonable costs (not to exceed
20% of base salary) incurred by Employee for outplacement services following
termination of Employee's employment in connection with a Change of Control. If
the Agreement has not been in effect three (3) years, the length of the
Executive's employment is used when provisions call for an average. In such
event, the sum of the benefits is placed in the numerator and the actual length
of service in months capped at 36 is placed in the denominator.
All amounts payable by the Company to the Employee in cash
pursuant to Section 3(i), (ii), (iii) and (iv) shall be made in a lump sum
unless the Employee otherwise elects and notifies the Company in writing prior
to the termination of his employment of his desire to have all payments made in
accordance with the Company's regular salary and benefit payment practices,
provided that the lump sum payment or first payment is made within thirty (30)
days after the Employee's termination hereunder. All other amounts payable by
the Company to the Employee pursuant to Section 3 shall be paid or provided in
accordance with the Company's standard payroll and reimbursement procedures, as
in effect immediately prior to the Change of Control. In the event that medical,
disability, dental and life insurance benefits cannot be provided under
appropriate Company group insurance policies, an amount equal to the premium
necessary for the Employee to purchase directly the same level of coverage in
effect immediately prior to the Change of Control shall be added to the
Company's salary payments to Employee.
If there is a Change of Control as defined above, the Company
will provide Salary and Benefits Continuation if at any time during the first
twenty-four (24) months following the consummation of a Change of Control,
either (i) the Company terminates the Employee's employment other than for Cause
as defined in Section 4 below or (ii) the Employee terminates his employment for
"Good Reason." The exception to this provision is the immediate vesting of all
unvested stock options and grants upon a Change of Control as defined above. It
is not necessary for the Company to terminate the Executive or for the Executive
to terminate employment.
For purposes of this Agreement, "Good Reason" is defined as:
(a) Removal of the Employee from the position he held
immediately prior to the Change of Control (by reason other than
death, disability or Cause), or any other material breach by the
Company of its obligations contained in this Agreement;
(b) The assignment to the Employee of any duties
inconsistent with those performed by the Employee immediately
prior to the Change of Control or a substantial alteration in the
nature or status of the Employee's responsibilities which renders
the Employee's position to be of less dignity, responsibility or
scope;
(c) A reduction by the Company in the Employee's annual
base salary as in effect on the date hereof or as the same may be
increased from time to time, except for proportional
across-the-board salary reductions similarly affecting all
executives of the Company and all executives of any person in
control of the Company, provided, however, that in no event shall
the Employee's annual base salary be reduced by an amount equal
to ten percent or more of the Employee's annual base salary as of
the end of the calendar year immediately preceding the year in
which the Change of Control occurs, without the Employee's
consent;
(d) The failure to grant the Employee an annual salary
increase reasonably necessary to maintain such salary as
reasonably comparable to salaries of senior executives holding
positions equivalent to the Employee's in the industry in which
the Company's then principal business activity is conducted;
(e) The Company requiring the Employee to be based
anywhere other than the Company's principal executive offices in
the city in which the Employee is principally located immediately
prior to the Change of Control, except for required travel on the
Company's business to an extent substantially consistent with the
Employee's present business travel obligations;
(f) Any material reduction by the Company of the benefits
enjoyed by the Employee under any of the Company's pension,
retirement, profit sharing, savings, life insurance, medical,
health and accident, disability or other employee benefit plans,
programs or arrangements, the taking of any action by the Company
which would directly or indirectly materially reduce any of such
benefits or deprive the Employee of any material fringe benefits,
or the failure by the Company to provide the Employee with the
number of paid vacation days to which he is entitled on the basis
of years of service with the Company in accordance with the
Company's normal vacation policy, provided that this paragraph
(f) shall not apply to any proportional across-the-board
reduction or action similarly affecting all executives of the
Company and all executives of any person in control of the
Company; or
(g) The failure of the Company to obtain a satisfactory
agreement from any successor to assume and agree to perform this
Agreement, as contemplated in Section 14 hereof.
The Employee's right to Salary and Benefits Continuation shall accrue upon the
occurrence of either (i) the Company terminates the Employee's employment other
than for Cause as defined in Section 4 below or (ii) the Employee terminates his
employment for "Good Reason" and shall continue as provided, notwithstanding the
subsequent expiration of this Agreement pursuant to Section 1 hereof. The
Employee's subsequent employment, death or disability following the Employee's
termination of employment in connection with a Change of Control shall not
affect the Company's obligation to continue making Salary and Benefits
Continuation payments. The Employee shall not be required to mitigate the amount
of any payment provided for in this Section 3 by seeking employment or
otherwise. The rights to Salary and Benefits Continuation shall be in addition
to whatever other benefits the Employee may be entitled to under any other
agreement or compensation plan, program or arrangement of the Company. For
purposes of interpreting any such other agreement, compensation plan, program or
arrangement, the occurrence of either of the events specified in (i) and (ii)
hereof shall be deemed to be a termination of Executive's employment by the
Company. The Company shall be authorized to withhold from any payment to the
Employee, his estate or his beneficiaries hereunder all such amounts, if any,
that the Company may reasonably determine it is required to withhold pursuant to
any applicable tax law or regulation.
Section 4. Termination of Employee for Cause.
Upon or following a Change of Control, the Company may at any time terminate the
Employee's employment for Cause. Termination of employment by the Company for
"Cause" shall mean termination upon:
(i) the willful and continued failure by the Employee to
substantially perform his duties with the Company (other than (A)
any such failure resulting from Employee's disability or (B) any
such actual or anticipated failure resulting from Employee's
termination of his/her employment for Good Reason), after a
written demand for substantial performance is delivered to the
Employee by the Board of Directors which specifically identifies
the manner in which the Board of Directors believes that the
Employee has not substantially performed his duties, and which
failure has not been cured within thirty days (30) after such
written demand; or
(ii) the willful and continued engaging by the Employee in
conduct which is demonstrably and materially injurious to the
Company, monetarily or otherwise, or
(iii) the breach by the Employee of the Confidentiality
provision set forth in Section 8 hereof.
For purposes of this Section 4, no act, or failure to act, on the
Employee's part shall be considered "willful" unless done, or omitted to be
done, by the Employee in bad faith and without reasonable belief that such
action or omission was in the best interest of the Company. Notwithstanding the
foregoing, the Employee shall not be deemed to have been terminated for Cause
unless and until there shall have been delivered to him a copy of a resolution
duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board of Directors at a meeting of the Board of
Directors called and held for that purpose (after reasonable notice to the
Employee and an opportunity for the Employee, together with his counsel, to be
heard before the Board of Directors) finding that in the good faith opinion of
the Board of Directors the Employee is guilty of the conduct set forth above in
clauses (i), (ii) or (iii) of this Section 4 and specifying the particulars
thereof in detail.
Section 5. Prior Termination.
Anything in this Agreement to the contrary notwithstanding, if the Employee's
employment with the Company is terminated prior to the date on which a Change of
Control occurs either (i) by the Company other than for Cause or (ii) by the
Employee for Good Reason, and it is reasonably demonstrated by Employee that
such termination of employment (a) was at the request of a third party who has
taken steps reasonably calculated to effect the Change of Control, or (b)
otherwise arose in connection with or anticipation of the Change of Control,
then for all purposes of this Agreement the termination shall be deemed to have
occurred upon a Change of Control and the Employee will be entitled to Salary
and Benefits Continuation as provided for in Section 3 hereof.
Section 6. Entire Understanding.
This Agreement contains the entire understanding of the Company and the Employee
with respect to the subject matter hereof.
Section 7. Construction of Agreement.
(a) Governing Law. This Agreement shall be governed
by and construed under the laws of the Commonwealth of
Pennsylvania without regard to its conflict of law provisions.
(b) Severability. In the event that any one or more of the
provisions of this Agreement shall be held to be invalid, illegal
or unenforceable, the validity, legality or enforceability of the
remaining provisions shall not in any way be affected or impaired
thereby.
(c) Headings. The descriptive headings of the several
paragraphs of this Agreement are inserted for convenience of
reference only and shall not constitute a part of this Agreement.
Section 8. Covenant as to Confidential Information.
In the event that the Employee violates the confidentiality requirement of
Section 1 of the Post Termination Confidentiality and Non-Competition Agreement
between the Executive and the Company, the Company shall be entitled, to the
extent permissible by law, and subject to Section 11 of this Agreement, to cease
to pay or provide the Employee or his dependents any compensation or benefit
being, or to be, paid or provided to him pursuant to Section 3 of this
Agreement, and also to obtain immediate injunctive relief restraining the
Employee from conduct in breach or threatened breach of the covenants contained
in this Section 8. Nothing herein shall be construed as prohibiting the Company
from pursuing any other remedies available to it for such breach or threatened
breach, including the recovery of damages from the Employee.
Section 9. Reimbursement of Fees.
The Company agrees to pay, to the full extent permitted by law, all legal fees
and expenses which the Employee may reasonably incur as a result of any contest
by the Company, Internal Revenue Service or others regarding the validity or
enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof (including as a result of any contest by the
Employee about the amount of any payment pursuant to Section 3 of this
Agreement) or in connection with any dispute arising from this Agreement,
regardless of whether Employee prevails in any such contest or dispute.
Section 10. Certain Reductions of Payments by the Company.
Notwithstanding anything herein to the contrary, if the aggregate of the amounts
due the Employee under this Agreement and any other plan or program of the
Company constitutes a "Parachute Payment," as such term is defined in Section
280G of the Internal Revenue Code of 1986, as amended, then the payments to be
made to the Employee under this Agreement which are contingent on a Change of
Control shall be reduced to an amount which, when added to the aggregate of all
other payments to be made to the Employee which are contingent on a Change of
Control, as a result of the termination of his employment, will make the total
amount of such payment equal to 2.99 times his Base Amount. The determinations
to be made with respect to this paragraph shall be made by an independent
auditor (the "Auditor") jointly selected by the Employee and the Company and
paid by the Company. In the event the payments to be made to the Employee are
required to be reduced pursuant to the limitations in this Section 10, the
Company shall allow the Employee to select which payment or benefits Employee
wants the Company to reduce in order that the total amount of such payment is
equal to 2.99 times such Employee's Base Amount. The Auditor shall be a
nationally recognized United States public accounting firm that has not, during
the two years preceding the date of its selection, acted in any way on behalf of
the Company or any of its subsidiaries.
Section 11. Resolution of Differences Over Breaches of Agreement.
Except as otherwise provided herein, in the event of any controversy, dispute or
claim arising out of, or relating to this Agreement, or the breach thereof, or
arising out of any other matter relating to the Employee's employment with the
Company or the termination of such employment, the parties may seek recourse
only for temporary or preliminary injunctive relief to the courts having
jurisdiction thereof and if any relief other than injunctive relief is sought,
the Company and the Employee agree that such underlying controversy, dispute or
claim shall be settled by arbitration conducted in Pittsburgh, Pennsylvania in
accordance with this Section 11 of this Agreement and the Commercial Arbitration
Rules of the American Arbitration Association ("AAA"). The matter shall be heard
and decided, and awards rendered by a panel of three (3) arbitrators (the
"Arbitration Panel"). The Company and the Employee shall each select one
arbitrator from the AAA National Panel of Commercial Arbitrators (the
"Commercial Panel") and AAA shall select a third arbitrator from the Commercial
Panel. The award rendered by the Arbitration Panel shall be final and binding as
between the parties hereto and their heirs, executors, administrators,
successors and assigns, and judgment on the award may be entered by any court
having jurisdiction thereof.
Section 12. Release.
The Employee hereby acknowledges and agrees that prior to the occurrence of the
Employee's or his dependents' right to receive from the Company or any of its
representatives or agents any compensation or benefit to be paid or provided to
him or his dependents pursuant to Section 3 of this Agreement, the Employee may
be required by the Company, in its sole discretion, to execute a release in a
form reasonably acceptable to the Company, which releases any and all claims
(other than amounts to be paid to Employee as expressly provided for under this
Agreement, the Employment Agreement, the Post Termination Confidentiality and
Non-Competition Agreement and the Supplemental Executive Retirement Agreement
the Employee has or may have against the Company or its subsidiaries, agents,
officers, directors, successors or assigns with respect to matters relating to
his employment and termination of employment.
Section 13. Waiver.
The waiver by a party hereto of any breach by the other party hereto of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach by a party hereto.
Section 14. Assignment.
This Agreement shall be binding upon and inure to the benefit of the successors
and assigns of the Company. The Company shall be obligated to require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the Company's business or assets, by a
written agreement in form and substance satisfactory to the Employee, to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform if no succession
had taken place. This Agreement shall inure to the extent provided hereunder to
the benefit of and be enforceable by the Employee or his legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees. The Employee may not delegate any of his duties, responsibilities,
obligations or positions hereunder to any person and any such purported
delegation by him shall be void and of no force and effect with respect to
matters relating to his employment and termination of employment. Without
limiting the foregoing, the Employee's rights to receive payments and benefits
hereunder shall not be assignable or transferable, other than a transfer by
Employee's will or by the laws of descent and distribution.
Section 15. Notices.
Any notices required or permitted to be given under this Agreement shall be
sufficient if in writing, and if personally delivered or when sent by first
class certified or registered mail, postage prepaid, return receipt requested --
in the case of the Employee, to his residence address as set forth below, and in
the case of the Company, to the address of its principal place of business as
set forth below, in care of the Chairman of the Board -- or to such other person
or at such other address with respect to each party as such party shall notify
the other in writing.
Section 16. Pronouns.
Pronouns stated in either the masculine, feminine or neuter gender shall
include the masculine, feminine and neuter.
Section 17. Entire Agreement
This Agreement contains the entire agreement of the parties concerning the
matters set forth herein and all promises, representations, understandings,
arrangements and prior agreements on such subject are merged herein and
superseded hereby. The provisions of this Agreement may not be amended,
modified, repealed, waived, extended or discharged except by an agreement in
writing signed by the party against whom enforcement of any amendment,
modification, repeal, waiver, extension or discharge is sought. No person acting
other than pursuant to a resolution of the Board of Directors shall have
authority on behalf of the Company to agree to amend, modify, repeal, waive,
extend or discharge any provision of this Agreement or anything in reference
thereto or to exercise any of the Company's rights to terminate or to fail to
extend this Agreement.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its officers thereunto duly authorized, and the Employee has
hereunto set his hand, all as of the day and year first above written.
ATTEST: EQUITABLE RESOURCES, INC.
/s/ Audrey C. Moeller /s/ Donald I. Moritz
______________________________________ By: ___________________________________
Audrey C. Moeller Donald I. Moritz
Vice President and Corporate Secretary President and
Chief Executive Officer
WITNESS:
/s/ G. R. Spencer /s/ M. S. Gerber
______________________________________ ___________________________________
Murry S. Gerber
Exhibit 10.4
SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT
This Supplemental Executive Retirement Agreement (the "Agreement") is
hereby entered into by and between Equitable Resources, Inc. (the "Company") and
Murry S. Gerber (the "Executive"), as of this 4th day of May, 1998.
WHEREAS, the Company desires to employ the Executive as Chief Executive
Officer and President of the Company; and
WHEREAS, the Executive will forego certain retirement benefits from a
prior employer by accepting employment with the Company; and
WHEREAS, in recognition of the Executive's potential loss of benefits
and in consideration of his expected substantial contributions to the success of
the Company, the Company desires to provide the Executive with additional
supplemental retirement benefits as provided in this Agreement.
NOW THEREFORE, the Company and the Executive agree to the following
terms of this Agreement.
SECTION 1. DEFINITIONS.
Except as otherwise provided herein, the capitalized terms set forth below shall
be defined as follows:
(a) Beneficiary. The beneficiary designated by the Executive in writing
and delivered to the Committee. In the absence of any such writing, the
beneficiary shall be the Executive's spouse, if living, and if not
living, the Executive's estate.
(b) Code. The Internal Revenue Code of 1986, as amended.
(c) Committee. The Compensation Committee of the Board of Directors of
the Company.
(d) Company. Equitable Resources, Inc. and any successors or assigns
of Equitable Resources, Inc.
(e) ERI Annuity Amount. The ERI Annuity Amount shall equal the
hypothetical straight-life annuity on the life of the Executive that is
determined as of the Executive's Termination Date and is based on the
sum of the vested account balances of the Executive under the Equitable
Resources, Inc. Employee Savings Plan and the Equitable Resources, Inc.
Deferred Compensation Plan. The annuity assumptions that will be used to
determine the ERI Annuity Amount shall be those set forth in Appendix A
of this Agreement.
(f) ERISA. The Employee Retirement Income Security Act of 1974, as
amended.
(g) Executive. Murry S. Gerber.
(h) Shell Annuity Amount. The Shell Annuity Amount shall equal
$150,000.
(i) Supplemental Retirement Period. The Supplemental Retirement Period
shall be the period described in Section 2 of this Agreement.
(j) Termination Date. The Executive's Termination Date shall be the date
that the Executive terminates employment with the Company.
SECTION 2. ELIGIBILITY FOR BENEFITS.
The Executive shall be eligible for benefits under this Agreement if his
Termination Date is on or after his 55th birthday and before his 65th birthday
(this period of time shall be referred to as the "Supplemental Retirement
Period"). If the Executive terminates employment with the Company before his
55th birthday, or on or after his 65th birthday, he shall not receive any
benefits under this Agreement. Notwithstanding the above sentences, if the
Executive is terminated by the Company involuntarily for any reason other than
cause as defined in the Employment Agreement, and is age 52 or greater, he will
be eligible for benefits under this Agreement commencing on his 55th birthday.
SECTION 3. AMOUNT OF BENEFITS. It is the intent of the Company that if the
Executive terminates employment with the Company during the Supplemental
Retirement Period, he shall receive benefits under this Agreement as provided in
paragraphs (a) and (b) below:
(a) Annual Benefit. The amount of the Executive's annual benefit under
this Agreement shall equal $211,500 minus the ERI Annuity Amount. This
benefit shall be paid to the Executive in monthly installments as
provided in Section 4 of this Agreement for each full and partial year
of the Supplemental Retirement Period.
(b) Final Benefit. Upon the expiration of the Supplemental Retirement
Period, the Executive shall receive a final benefit under this Agreement
equal to the present value, if any, of a straight-life annuity for the
Executive based on an annual amount equal to $211,500 minus (i) the ERI
Annuity Amount, and minus (ii) the Shell Annuity Amount. If the final
benefit amount determined under this paragraph is less than zero, then
no additional benefits shall be paid to the Executive under this
Agreement. The life expectancy assumption and the present value amount
shall be determined based on the assumptions set forth in Appendix A.
SECTION 4. PAYMENT OF BENEFITS. The Executive shall receive annual benefits as
described in Section 3(a) of this Agreement commencing with the last day of the
month following the month of his Termination Date during the Supplemental
Retirement Period and continuing on the last day of each succeeding month until
the expiration of the Supplemental Retirement Period. The Executive shall
receive his final benefit as described in Section 3(b) of this Agreement in a
lump-sum cash payment as soon as practicable following his 65th birthday.
SECTION 5. FORFEITURE OF BENEFITS. The Executive shall forfeit his right to
benefits under this Agreement if he accepts employment with another company
after his Termination Date during the Supplemental Retirement Period.
SECTION 6. DEATH BENEFITS.
No death benefits are provided under this Agreement because this Agreement is
designed to compensate for benefits provided to the Executive under his prior
retirement plan in the form of a straight-life annuity.
SECTION 7. UNSECURED RIGHT TO BENEFITS.
The Executive shall have only the unsecured and unfunded promise to be paid
benefits under this Agreement. The Company shall establish a rabbi trust for the
purpose of holding assets to assist it in meeting its obligations to the
Executive under this Agreement. The Company may make such contributions to the
rabbi trust at its discretion, except that if the Executive's Termination Date
is within the Supplemental Retirement Period, the Company shall contribute an
amount to the rabbi trust equal to the present value of the amount necessary to
pay all future amounts under this Agreement. The present value amount shall be
determined in accordance with the assumptions set forth in Appendix A. This
Agreement and rabbi trust is intended to constitute an unfunded plan for federal
income tax purposes and shall be a "top-hat plan" for purposes of Sections
201(2), 301(a)(3) and 401(a)(1) of ERISA.
SECTION 8. EMPLOYMENT TAX TREATMENT.
This Agreement is intended to be a "deferred compensation agreement" for
purposes of the employment tax provisions of Code Section 3121(v). It is
intended that the Executive's rights to a benefit will be subject to a
substantial risk of forfeiture for purposes of Section 3121(v) and within the
meaning of Treasury Regulation Section 1.83-3(c) until the Executive's
termination of employment during the Supplemental Retirement Period. At that
time, it is intended that the Executive's unfunded promise to be paid benefits
as they come due shall not be treated as a substantial risk of forfeiture for
purposes of Section 3121(v).
SECTION 9. PARACHUTE PAYMENT TREATMENT.
The purpose of this Agreement is to both induce the Executive to become employed
with the Company and to recognize the value of the Executive's expected services
for the Company. Therefore, it is intended that benefits payable under this
Agreement should be treated as payments in the nature of compensation within the
meaning of Code Section 280G and the Regulations thereunder (the "280G Rules")
and that such payments constitute reasonable compensation within the meaning of
the 280G Rules.
SECTION 10. ADMINISTRATION.
This Agreement shall be administered by the Committee. All determinations of the
Committee as to any questions arising under this Agreement, including questions
of construction and interpretation, shall be final, binding and conclusive upon
all persons. The Committee may delegate any of its responsibilities under the
plan to another committee of the Company or to any other delegee. The Executive
may not serve as a member of this Committee or be a delegee.
SECTION 11. INTEREST NOT TRANSFERABLE.
All benefits provided under this Agreement may not be assigned, alienated,
attached or encumbered by the Executive or his Beneficiary.
SECTION 12. EFFECT ON OTHER BENEFIT PLANS.
Amounts credited or paid under this Agreement shall not be considered to be
compensation for the purposes of any qualified retirement plans maintained by
the Company. The treatment of such amounts under other employee benefit plans
will be determined pursuant to the provisions of such plans. In addition, the
Executive's right to benefits under this Agreement shall survive the termination
of the Executive's Employment Agreement.
SECTION 13. INCOMPETENCY.
In the event the Executive is determined by a court to be incompetent, the
Committee may, in its discretion, pay the benefits provided herein to the
Executive's legal guardian for the benefit of the Executive.
SECTION 14. CLAIMS PROVISION.
The Executive may make a claim to the Committee with regard to a payment of
benefits provided herein. If the Committee receives a claim in writing, the
Committee must give notice to the Executive in writing within a reasonable
period of time after receipt of the claim, (not to exceed 90 days; or under
special circumstances, 120 days). The notice of denial shall set forth the
following information:
(a) The specific reasons for such denial;
(b) Specific reference to pertinent Agreement provisions on which
the denial is based;
(c) A description of any additional material or information
necessary for the Executive to perfect a claim and an
explanation of why such material or information is necessary;
and
(d) An explanation of the Agreement's claim review procedure.
If the Executive does not receive a notice of denial within 180 days after
receipt of the claim, the claim will be deemed to have been denied. The
Executive may request a review of a denial (or deemed denial) by filing with the
Committee a written request for such review. The request must be filed within 60
days after the notice of denial is received, or within 60 days after the denial
is deemed to have occurred. The Executive may review pertinent documents and
submit issues and comments in writing within the same 60 day period. If a
request for review is filed, such review shall be made by the Committee within
60 days after receipt of such request, unless special circumstances require an
extension of time for processing, in which case the Executive shall be so
notified and a decision shall be rendered as soon as possible, but not later
than 120 days after receipt of the request for review. Upon completion of the
review, the Executive shall be given written notice of the decision resulting
from such review, which notice shall include specific reasons for the decision
and specific references to the pertinent Agreement provisions on which the
decision is based.
SECTION 15. SEVERABILITY.
In the event that any provision of the Agreement shall be held invalid or
illegal for any reason, any illegality or invalidity shall not affect the
remaining parts of the Agreement. Instead, the Agreement shall be construed and
enforced as if the illegal or invalid provision had never been inserted and the
Company shall have the privilege and opportunity to correct and remedy such
questions of illegality or invalidity by amendment.
SECTION 16. APPLICABLE LAW.
To the extent that state law applies, the Agreement shall be governed and
construed in accordance with the laws of the Commonwealth of Pennsylvania.
SECTION 17. AMENDMENT AND TERMINATION.
The Company and the Executive may amend or terminate this Agreement only by
mutual assent as evidenced by a written documentation. In the event that the
Agreement is terminated during the Supplemental Retirement Period at a time in
which the Executive is entitled to future payments under the Agreement, the
Executive will receive a lump-sum cash payment of the present value of any such
remaining benefits. The present value amount shall be determined in accordance
with the assumptions set forth in Appendix A. In any event, this Agreement shall
terminate immediately upon the Executive's receipt of all benefits under this
Agreement or in the event that the Executive's Termination Date is before or
after the Supplemental Retirement Period.
IN WITNESS WHEREOF, the Company and the Executive have caused this
Agreement to be executed as of the date first written above.
ATTEST: EQUITABLE RESOURCES, INC.
/s/ Audrey C. Moeller /s/ Donald I. Moritz
______________________________________ By: __________________________________
Vice President and Corproate Secretary Donald I. Moritz
President and
Chief Executive Officer
WITNESS: MURRY S. GERBER
/s/ G. R. Spencer /s/ M. S. Gerber
______________________________________ ______________________________________
<PAGE>
APPENDIX A
The annuity assumptions that shall be used to determine the ERI Annuity Amount
shall be as follows:
The annual rate of interest on 30-year Treasury securities for the November
preceding the Executive's Termination Date (the "GATT Rate").
The 1983 Group Annuity Mortality Table, with a 50%/50% weighting of the
male/female mortality rates, without projection (the "GAM83 50/50 Table").
POST-TERMINATION CONFIDENTIALITY
AND NON-COMPETITION AGREEMENT
This Agreement made this 4th day of May, 1998 (the "Effective Date"), by
and between EQUITABLE RESOURCES, INC., having a business address at 420
Boulevard of the Allies, Pittsburgh, Pennsylvania 15219 (Equitable Resources,
Inc. and its subsidiary companies hereinafter collectively known as the
"Company") and MURRY S. GERBER, an individual and resident of Bellaire, Texas,
(the "Executive").
WHEREAS, the Company is concurrently entering into an Employment
Agreement of even date herewith with Executive for which the execution of this
Agreement is a precondition;
WHEREAS, the Company is willing to grant to the Executive certain
additional benefits in consideration of the Executive's agreement to comply with
specific post-employment confidentiality and non-competition requirements
contained herein; and
WHEREAS, the Company and the Executive desire to enter into this
Agreement to reflect their understanding of those benefits and requirements.
NOW THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein, and intending to be legally bound hereby, the
parties hereto agree as follows:
Section 1. Confidentiality:
Recognizing (1) that trade secrets or confidential information in any way
related to the business activities of the Company, such as, but not limited to:
marketing plans, business plans, technical information, market information,
customer lists, pricing data and strategies, financial information, business
methods or practices, programs, hardware and software (referred to hereinafter
collectively as "Confidential Information"), constitute valuable assets of the
Company, and (2) that such Confidential Information is the property of the
Company, Executive covenants, in consideration of Executive's access to and use
of Confidential Information, to hold such Confidential Information in trust for
the Company, and successors and assigns, and not to disclose or use the same
other than in the business of the Company, specifically agreeing:
(a) not to, directly or indirectly, disclose or make available to anyone
or use outside of the Company's organization during or after the term of
employment, any Confidential Information unless such disclosure or availability
or use is approved by the Company;
(b) to use reasonable efforts to safeguard all Confidential Information
within the possession or control of Executive at all times so it is not exposed
to, or taken by, any unauthorized person (including unauthorized employees and
agents of the Company);
(c) upon termination of employment, to deliver to the Company all
papers, photographs, photoreproductions, computer tapes, tape recordings and
other materials, including but not limited to Confidential Information,
including personal notes and reproductions, relating to the business of the
Company, its subsidiaries and affiliates in the Executive's possession or
control.
This Section 1 shall not apply to any Confidential Information
that the Company has voluntarily disclosed to the public or that has otherwise
legally entered the public domain or which was known by the Executive prior to
his employment with the Company or which is required by law to be disclosed.
Section 2. Non-competition:
For a period of two years from the termination date of his employment, the
Executive will not (i) engage, directly or indirectly, whether as principal or
as agent, officer, director, employee, consultant, owner, partner, shareholder,
or otherwise, alone or in association with any other person, corporation or
other entity, in any business which produces, markets, or sells any product or
service in competition with products or services which the Company, produces,
markets, or sells in any geographic market where the Company is engaged in
business; (ii) solicit, directly or indirectly, either for himself or any other
person, any business related to the business of any customer, supplier, licensee
or other person having a business relationship with the Company, or induce or
attempt to induce any such person to cease doing business with the Company;
(iii) interfere, or attempt to interfere, with any contemplated business project
which representatives of the Company have discussed with any potential
participant in such project; or (iv) induce, or attempt to induce, any employee
of the Company to leave the employ of the Company or to violate the terms of his
contract with the Company, or employ or otherwise engage as an employee,
independent contractor or otherwise any such person. Notwithstanding the
provisions of Section 2(a)(i), the Executive may purchase or otherwise acquire
up to (but not more than) 1% of any class of securities of any enterprise (but
without otherwise participating in the activities of such enterprise) if such
securities are listed on any national or regional securities exchange or have
been registered under Section 12(g) of the Securities Exchange Act of 1934. The
Executive agrees that this covenant is reasonable with respect to duration,
geographical area and scope. The two year period described in the first sentence
of this Section, shall be replaced with a one year period in the event the
Executive is involuntarily terminated by the Company or has a termination date
within twenty-four (24) months of a Change of Control as defined in the Change
of Control Agreement between the Executive and the Company.
Section 3. Consideration:
If the employment of the Executive with the Company is terminated by the Company
for any reason (other than for Cause as defined below), the Executive shall
receive, from the date of termination, in addition to any payments he may be
entitled to under other agreements with the Company (in accordance with their
terms), 24 months of base salary payments at the salary level in effect at the
time of such termination. For purposes of this Agreement, "Cause" shall include:
(i) the conviction of a felony, a crime of moral turpitude or fraud or having
committed fraud, misappropriation or embezzlement in connection with the
performance of his duties hereunder, (ii) willful and repeated failures to
substantially perform his assigned duties, or (iii) a material violation of any
other provisions of this Agreement or express significant policies of the
Company. The purpose of this Agreement is to obtain the Executive's agreement to
the covenants contained herein and it is intended that benefits payable under
this Agreement should be treated as payments in the nature of compensation
within the meaning of Code Section 280G and the Regulations thereunder (the
"280G Rules") and that such payments constitute reasonable compensation within
the meaning of the 280G Rules.
Section 4. Term:
The term of this Agreement shall commence on the Effective Date and shall remain
in effect unless amended or terminated by mutual written agreement.
Section 5. Certain Remedies:
Without limiting the remedies available to the Company, the Executive
acknowledges that damages at law will be an insufficient remedy to the Company
in the event that the Executive violates the terms of this Agreement and that
the Company may apply for, and obtain, injunctive relief to restrain the breach
or threatened breach of, or otherwise to specifically enforce, such covenants.
If it should become desirable or necessary for the Company to seek compliance
with this Agreement by judicial proceedings, the period of time during which
Executive is restricted under Section 2 shall be extended by the amount of time
remaining under the original restriction on the date Executive first breached
this Agreement, commencing on the date of the trial court order or settlement
requiring such compliance. If litigation should develop between the parties
regarding this Agreement or the obligations undertaken hereby, the party
prevailing in such litigation may recover from the other such costs and
expenses, including reasonable attorneys' fees, if any, as a court of competent
jurisdiction may determine or award.
Section 6. Governing Law:
This Agreement shall be governed by and construed in accordance with the laws of
the Commonwealth of Pennsylvania.
Section 7. Binding Agreement:
The obligations of Executive under this Agreement shall continue after the
termination of his employment with the Company for any reason, with or without
cause, and shall be binding on Executive's heirs, executors and legal
representatives and shall inure to the benefit of any successors by merger or
purchase of substantially all of the assets of the Company.
Section 8. Company Violation Not a Defense:
The existence of any claim or cause of action against the Company, whether
predicated on this Agreement or otherwise, shall not constitute a defense to
enforcement by the Company of this Agreement.
Section 9. Authorization to Modify Restrictions:
It is the intention of the parties that the provisions of this Agreement shall
be enforceable to the fullest extent permissible under applicable law, but that
the unenforceability (or modification to conform to such law) of any provision
or provisions hereof shall not render unforeseeable, or impair the remaining
provisions of this Agreement. If any provision or provisions of this Agreement
shall be deemed illegal, invalid or otherwise unenforeceable, either in whole or
in part, this Agreement shall be deemed amended to delete or modify, as
necessary, the offending provision or provisions and to alter the bounds thereof
to render it valid and enforceable.
Section 10. Consent to Jurisdiction and Venue:
Any action or proceeding arising out of or relating to this Agreement shall be
commenced by either party in any state or federal court in Allegheny County,
Pennsylvania and the parties hereby irrevocably agree that all claims in respect
of any such action or proceeding may be heard and determined in any such court.
Executive and the Company acknowledge that the forum designated herein present
the most convenient forum for both parties. In any action commenced in any of
these courts, Executive and the Company waive any objections to inconvenience of
forum, venue and personal jurisdiction of the Court. Section 11. Notices:
Section 11. Notices hereunder shall be in writing and shall be deemed
effective when received by the Company or the Executive at their respective
addresses above given.
Section 12. Waiver:
A waiver by the Company of a breach of any of the provisions of this Agreement
shall not operate or be construed as a waiver or excuse of any subsequent or
different breach.
Section 13. Integration and Modification:
This Agreement contains the entire agreement between the parties hereto with
respect to the subject matter hereof (except for the Employment Agreement and
its appendices executed as of even date herewith between the Executive and the
Company) and supersedes all prior agreements and understandings, oral or
written. This Agreement may not be changed, amended, or modified, except by a
written instrument signed by the parties and shall survive the expiration or
termination of the Employment Agreement.
Executive acknowledges that he has read and understands the provisions of this
Agreement, that he has been given an opportunity for his legal counsel to review
this Agreement and that the provisions of this Agreement are reasonable.
ATTEST: EQUITABLE RESOURCES, INC.
/s/ Audrey C. Moeller /s/ Donald I. Moritz
____________________________________ By ____________________________________
Audrey C. Moeller Donald I. Moritz
Vice President and Corporate Secretary President and Chief Executive Officer
WITNESS:
/s/ G. R. Spencer /s/ M. S. Gerber
- ----------------------------------- ------------------------------------
Murry S. Gerber
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125,000
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