<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 14, 1997
REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
------------
<TABLE>
<S> <C> <C>
TRAVELERS GROUP INC. DELAWARE 52-1568099
TRAVELERS CAPITAL IV DELAWARE 06-6432183
TRAVELERS CAPITAL V DELAWARE 06-6432184
TRAVELERS CAPITAL VI DELAWARE 06-6446485
TRAVELERS CAPITAL VII DELAWARE 06-6446486
(EXACT NAME OF REGISTRANT AS (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
SPECIFIED IN ITS CHARTER) INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBERS)
</TABLE>
------------
388 GREENWICH STREET
NEW YORK, NEW YORK 10013
(212) 816-8000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF EACH REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
---------------
CHARLES O. PRINCE, III
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
388 GREENWICH STREET
NEW YORK, NEW YORK 10013
(212) 816-8000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF AGENT FOR SERVICE FOR EACH REGISTRANT)
---------------
COPIES TO:
<TABLE>
<S> <C>
KENNETH J. BIALKIN, ESQ. FREDERICK W. KANNER, ESQ.
SKADDEN, ARPS, SLATE, DEWEY BALLANTINE
MEAGHER & FLOM LLP 1301 AVENUE OF THE AMERICAS
919 THIRD AVENUE NEW YORK, NEW YORK 10019
NEW YORK, N.Y. 10022 (212) 259-8000
(212) 735-3000
</TABLE>
------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: From time to
time after the effective date of the registration statement, as determined by
market conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. /X/
(COVER CONTINUED ON NEXT PAGE)
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED PROPOSED
AMOUNT MAXIMUM MAXIMUM
TO BE OFFERING PRICE AGGREGATE AMOUNT OF
TITLE OF EACH CLASS REGISTERED PER OFFERING REGISTRATION FEE
OF SECURITIES TO BE REGISTERED (1)(2)(3) UNIT (4)(5) PRICE (4)(5) (4)
<S> <C> <C> <C> <C>
Trust Preferred Securities of the
Trusts..........................
Junior Subordinated Debt
Securities of Travelers Group
Inc.............................
Guarantees of Trust Preferred
Securities of the Trusts and
certain back-up obligations
(6).............................
Preferred Stock of Travelers Group
Inc.............................
Depositary Shares of Travelers
Group Inc.......................
Common Stock of Travelers Group
Inc. reserved for issuance upon
conversion or exchange of
Preferred Stock (7).............
Total............................. $1,000,000,000 100% $1,000,000,000 $303,031
</TABLE>
(1) Such indeterminate number of Preferred Securities of Travelers Capital IV,
Travelers Capital V, Travelers Capital VI and Travelers Capital VII (each a
"Trust") and such indeterminate principal amount of Junior Subordinated Debt
Securities of Travelers Group Inc. as may from time to time be issued at
indeterminate prices. Includes Preferred Securities which may be purchased
by underwriters to cover over-allotments, if any. Junior Subordinated Debt
Securities may be issued and sold to any Trust, in which event such Junior
Subordinated Debt Securities may later be distributed to the holders of
Preferred Securities upon a dissolution of such Trust and the distribution
of the assets thereof.
(2) Such indeterminate number of shares of Preferred Stock of Travelers Group
Inc. as from time to time may be issued at indeterminate prices. Includes
Preferred Stock which may be purchased by underwriters to cover over-
allotments, if any.
(3) Such indeterminate number of Depositary Shares as may be issued in the event
that Travelers Group Inc. elects to offer fractional interests in the
Preferred Stock registered hereby. Includes Depositary Shares which may be
purchased by underwriters to cover over-allotments, if any.
(4) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457. The aggregate public offering price of the Preferred
Securities of the Trusts and the Junior Subordinated Debt Securities,
Preferred Stock and the Depositary Shares of Travelers Group Inc. registered
hereby will not exceed $1,000,000,000.
(5) Exclusive of accrued interest, distributions and dividends, if any.
(6) Includes the rights of holders of the Preferred Securities under any
Guarantees and certain back-up undertakings, comprised of the obligations of
Travelers Group Inc. to provide certain indemnities in respect of, and pay
and be responsible for certain costs, expenses, debts and liabilities of,
each Trust (other than with respect to the Preferred Securities) and such
obligations of Travelers Group Inc. as set forth in the Amended and Restated
Declaration of Trust of each Trust and the Indenture, in each case as
further described in the Registration Statement. The Guarantees, when taken
together with Travelers Group Inc.'s obligations under the Junior
Subordinated Debt Securities, the Indenture and the Amended and Restated
Declaration of Trust, will provide a full and unconditional guarantee on a
subordinated basis by Travelers Group Inc. of payments due on the Preferred
Securities. No separate consideration will be received for any Guarantee or
such back-up obligations.
(7) Such indeterminate number of shares of Common Stock as may be issued upon
conversion of or exchange for any Preferred Stock or Depositary Shares that
provide for such conversion or exchange are being registered hereby. No
separate consideration will be received for the Common Stock issuable upon
such conversion or exchange.
<PAGE>
SUBJECT TO COMPLETION DATED MAY 14, 1997
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
PROSPECTUS
TRAVELERS GROUP INC.
PREFERRED STOCK
DEPOSITARY SHARES
JUNIOR SUBORDINATED DEBT SECURITIES
------------------
TRAVELERS CAPITAL IV
TRAVELERS CAPITAL V
TRAVELERS CAPITAL VI
TRAVELERS CAPITAL VII
TRUST PREFERRED SECURITIES
GUARANTEED TO THE EXTENT SET FORTH HEREIN BY
TRAVELERS GROUP INC.
----------------
Travelers Group Inc., a Delaware corporation (the "Company"), may offer,
from time to time, (i) its unsecured junior subordinated debt securities (the
"Junior Subordinated Debt Securities"), consisting of debentures, notes or other
evidences of indebtedness, in one or more series, and (ii) shares of its
preferred stock, $1.00 par value (the "Preferred Stock"), which may be issued in
the form of depositary shares (the "Depositary Shares") evidenced by depositary
receipts, in amounts, at prices and on terms to be determined at or prior to the
time of any such offering. The Company's obligations under the Junior
Subordinated Debt Securities will be subordinate and junior in right of payment
to certain other indebtedness of the Company as described herein or as may be
described in an accompanying Prospectus Supplement (the "Prospectus
Supplement").
Travelers Capital IV, Travelers Capital V, Travelers Capital VI and
Travelers Capital VII (each, a "TRV Trust" and, together, the "TRV Trusts"),
each a statutory business trust formed under the laws of the State of Delaware,
may offer, from time to time, trust preferred securities, representing undivided
beneficial interests in the assets of the respective TRV Trust ("Preferred
Securities") with the payment of periodic cash distributions ("distributions")
and payments on liquidation, redemption or otherwise of such Preferred
Securities guaranteed (each, a "Guarantee") on a subordinated basis by the
Company to the extent described herein. See "Description of Guarantees." The
Company's obligations under the Guarantees will rank PARI PASSU with the most
senior preferred or preference stock now or hereafter issued by the Company. See
"Description of Guarantees--Status of Guarantees." Junior Subordinated Debt
Securities may be issued and sold from time to time in one or more series by the
Company to a TRV Trust, or a trustee of such trust, in connection with the
investment of the proceeds from the offering of Preferred Securities and Common
Securities (as defined herein) of such TRV Trust, but the Company does not
intend to issue and sell the Junior Subordinated Debt Securities directly to
other purchasers, including the general public. The Junior Subordinated Debt
Securities purchased by a TRV Trust may be subsequently distributed PRO RATA to
holders of Preferred Securities and Common Securities in connection with the
dissolution of such TRV Trust upon the occurrence of certain events as may be
described in an accompanying Prospectus Supplement. The Guarantees, when taken
together with the Company's obligations under the Junior Subordinated Debt
Securities, the Indenture (as defined herein) and the Declaration (as defined
herein), including its obligations to pay costs, expenses, debts and liabilities
of such TRV Trust (other than with respect to the Preferred Securities and the
Common Securities), will provide a full and unconditional guarantee on a
subordinated basis by the Company of payments due on Preferred Securities.
(CONTINUED ON NEXT PAGE)
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF SECURITIES UNLESS
ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
------------------------
SMITH BARNEY INC.
, 1997
<PAGE>
(CONTINUED FROM PREVIOUS PAGE)
Specific terms of the Junior Subordinated Debt Securities of any series, the
Preferred Securities of any TRV Trust, the Preferred Stock of any series or the
Depositary Shares in respect of which this Prospectus is being delivered (the
"Offered Securities") will be set forth in a Prospectus Supplement with respect
to such Offered Securities, which will describe, without limitation and where
applicable, the following: (i) in the case of Junior Subordinated Debt
Securities, the specific designation, aggregate principal amount, denomination,
maturity, premium, if any, redemption or sinking fund provisions, if any,
interest rate (which may be fixed or variable), if any, the time and method of
calculating interest payments, if any, dates on which premium, if any, and
interest, if any, will be payable, the right of the Company, if any, to defer
payment of interest on the Junior Subordinated Debt Securities and the maximum
length of such deferral period, the initial public offering price, subordination
terms, and any listing on a securities exchange and other specific terms of the
offering of Junior Subordinated Debt Securities, (ii) in the case of Preferred
Securities, the designation, number of securities, liquidation preference per
security, initial public offering price, any listing on a securities exchange,
distribution rate (or method of calculation thereof), dates on which
distributions shall be payable and dates from which distributions shall accrue,
any voting rights, any redemption or sinking fund provisions, any other rights,
preferences, privileges, limitations or restrictions relating to the Preferred
Securities and the terms upon which the proceeds of the sale of the Preferred
Securities shall be used to purchase a specific series of Junior Subordinated
Debt Securities, and (iii) in the case of Preferred Stock and Depositary Shares,
the specific designation, the number of shares, any dividend (including the
method of calculating payment of dividends), seniority, liquidation, redemption,
voting and other rights, any terms for any conversion or exchange into shares of
the common stock, $.01 par value, of the Company (the "Common Stock"), any
listing on a securities exchange, the initial public offering price and any
other terms.
If as set forth in the applicable Prospectus Supplement, the Company has the
right to defer payments of interest on a series of Junior Subordinated Debt
Securities by extending the interest payment period of such series of Junior
Subordinated Debt Securities (each, an "Extension Period"), distributions on the
corresponding series of Preferred Securities will also be deferred.
The Offered Securities may be offered in amounts, at prices and on terms to
be determined at the time of offering; PROVIDED, HOWEVER, that the aggregate
initial public offering price of all Offered Securities shall not exceed
$1,000,000,000. Any Prospectus Supplement relating to any series of Offered
Securities will contain information concerning certain United States federal
income tax considerations, if applicable, to the Offered Securities.
The Company or any of the TRV Trusts may sell the Offered Securities
directly, through agents designated from time to time or through underwriters or
dealers. See "Plan of Distribution." If any agents of the Company, any of the
TRV Trusts or any underwriters or dealers are involved in the sale of the
Offered Securities, the names of such agents, underwriters or dealers and any
applicable commissions and discounts will be set forth in any related Prospectus
Supplement.
This Prospectus, together with an appropriate Prospectus Supplement, may be
used by Smith Barney Inc. ("Smith Barney"), an indirect wholly owned subsidiary
of the Company and an affiliate of the TRV Trusts, in connection with offers and
sales of the Offered Securities in market-making transactions at negotiated
prices related to prevailing market prices at the time of sale. Smith Barney may
act as principal or agent in such transactions.
Certain persons participating in this offering may engage in transactions
that stabilize, maintain, or otherwise affect the price of the securities
offered hereby, including by entering stabilizing bids, effecting syndicate
covering transactions or imposing penalty bids. For a description of these
activities, see "Plan of Distribution."
2
<PAGE>
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR ANY ACCOMPANYING PROSPECTUS
SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY OF THE TRV
TRUSTS, OR ANY UNDERWRITER, AGENT OR DEALER. NEITHER THE DELIVERY OF THIS
PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE THEREUNDER SHALL,
UNDER ANY CIRCUMSTANCE, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN
THE AFFAIRS OF THE COMPANY OR ANY OF THE TRV TRUSTS SINCE THE DATE HEREOF OR
THEREOF. THIS PROSPECTUS AND ANY RELATED PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES
OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE
SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION.
FOR NORTH CAROLINA INVESTORS: THE COMMISSIONER OF INSURANCE OF THE STATE OF
NORTH CAROLINA HAS NOT APPROVED OR DISAPPROVED THIS OFFERING NOR HAS SUCH
COMMISSIONER RULED UPON THE ACCURACY OR THE ADEQUACY OF THIS PROSPECTUS.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports and other information can be
inspected and copied at the public reference facilities maintained by the
Commission at: Room 1024, 450 Fifth Street, N.W., Washington, D.C.
20549; Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511; and Seven World Trade Center, New York, New York 10048. Copies of
such material can also be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates. The Commission also maintains a site on the World Wide Web, the address
of which is http://www.sec.gov, that contains reports, proxy and information
statements and other information regarding issuers, such as the Company, that
file electronically with the Commission. The Company's common stock is listed on
the New York Stock Exchange, Inc. (the "NYSE") and The Pacific Exchange, Inc.
(the "PCX"), and such reports, proxy statements, and other information can also
be inspected at the offices of the New York Stock Exchange, Inc., 20 Broad
Street, New York, New York 10005, and The Pacific Exchange, Inc., 301 Pine
Street, San Francisco, California 94104, and 233 South Beaudry Avenue, Los
Angeles, California 90012.
The Company and the TRV Trusts have filed with the Commission a Registration
Statement on Form S-3 (the "Registration Statement," which term shall include
all amendments, exhibits, annexes and schedules thereto) pursuant to the
Securities Act of 1933, as amended (the "Act"), with respect to the Offered
Securities. This Prospectus does not contain all the information set forth in
the Registration Statement, certain parts of which are omitted in accordance
with the rules and regulations of the Commission. For further information with
respect to the Company, the TRV Trusts and the Offered Securities, reference is
made to the Registration Statement and exhibits thereto. Statements contained in
this Prospectus as to the contents of any contract or other document are not
necessarily complete, and in each instance reference is made to the copy of such
contract or document filed as an exhibit to the Company's Registration
Statement, each such statement being qualified in all respects by such
reference.
No separate financial statements of the TRV Trusts have been included or
incorporated by reference herein. The Company does not consider that such
financial statements would be material to holders of the Preferred Securities
because (i) all of the voting securities of the TRV Trusts will be owned,
directly or indirectly, by the Company, a reporting company under the Exchange
Act, (ii) the TRV Trusts have no independent operations but exist for the sole
purpose of issuing securities representing undivided beneficial interests in
their respective assets and investing the proceeds thereof in Junior
Subordinated Debt Securities issued by the Company, and (iii) the obligations of
the TRV Trusts under the Preferred Securities are fully and unconditionally
guaranteed by the Company to the extent that the respective TRV Trust has funds
available to meet such obligations. See "Description of Junior Subordinated Debt
Securities" and "Description of Guarantees."
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company incorporates by reference the following documents heretofore
filed with the Commission pursuant to the Exchange Act:
1. Annual Report on Form 10-K of the Company for the fiscal year ended
December 31, 1996;
3
<PAGE>
2. Quarterly Report on Form 10-Q of the Company for the quarter ended
March 31, 1997;
3. Current Reports on Form 8-K of the Company, dated January 19, 1996,
as amended, April 2, 1996, as amended, and June 7, 1996; and
4. The Company's Registration Statement on Form 8-B, dated May 10, 1988,
describing the Common Stock, including any amendments or reports filed for
the purpose of updating such description.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to
the later of (i) the termination of the offering of Offered Securities hereby
and (ii) the date on which Smith Barney ceases offering and selling Offered
Securities pursuant to this Prospectus shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed to constitute a part of
this Prospectus except as so modified or superseded.
The Company will provide without charge to each person to whom this
Prospectus is delivered, on the written or oral request of any such person, a
copy of any or all of the documents incorporated by reference in the
Registration Statement of which this Prospectus forms a part other than exhibits
to such documents unless such exhibits are specifically incorporated by
reference into such documents. Requests should be directed to Travelers Group
Inc., 388 Greenwich Street, New York, New York 10013; Attention: Treasurer;
telephone (212) 816-8000.
4
<PAGE>
THE COMPANY
The Company is a financial services holding company engaged, through its
subsidiaries, principally in four business segments: Investment Services,
Consumer Finance Services, Property & Casualty Insurance Services and Life
Insurance Services.
The Company's Investment Services segment consists of investment banking,
asset management, brokerage and other financial services provided through Smith
Barney Holdings Inc. and its subsidiaries. The Company's Consumer Finance
Services segment includes consumer lending services conducted primarily under
the name "Commercial Credit" and credit-related insurance and credit card
services. The Company's Property & Casualty Insurance Services segment includes
the operations of Travelers Property Casualty Corp., an 82% owned subsidiary of
the Company, and its subsidiary and affiliated property-casualty insurance
companies, which provide a wide range of commercial and personal property and
casualty insurance products and services to businesses, government units,
associations and individuals. The Company's Life Insurance Services segment
includes individual life insurance, annuities and pension programs which are
offered primarily through The Travelers Insurance Company, The Travelers Life
and Annuity Company and Primerica Life Insurance Company.
In addition to its four business segments, the Company's Corporate and Other
segment consists of unallocated expenses and earnings primarily related to
interest, corporate administration, and certain corporate investments.
The principal offices of the Company are located at 388 Greenwich Street,
New York, New York 10013 and its telephone number is (212) 816-8000.
TRV TRUSTS
Each of the TRV Trusts is a statutory business trust formed under Delaware
law pursuant to (i) a declaration of trust executed by the Company, as sponsor
for such trust (the "Sponsor"), and the trustees of such trust dated (x) with
respect to Travelers Capital IV and Travelers Capital V, as of September 19,
1996, and (y) with respect to Travelers Capital VI and Travelers Capital VII, as
of May 14, 1997, and (ii) the filing of a certificate of trust with the
Secretary of State of the State of Delaware on (x) with respect to Travelers
Capital IV and Travelers Capital V, September 19, 1996 and (y) with respect to
Travelers Capital VI and Travelers Capital VII, May 14, 1997. Each such
declaration will be amended and restated in its entirety (as so amended and
restated, each a "Declaration") substantially in the form filed as an exhibit to
the Registration Statement of which this Prospectus forms a part. Each of the
TRV Trusts exists for the exclusive purposes of (i) issuing the Preferred
Securities and common securities representing undivided beneficial interests in
the assets of the Trust (the "Common Securities" and, together with the
Preferred Securities, the "Trust Securities"), (ii) investing the gross proceeds
from the sale of the Trust Securities in the Junior Subordinated Debt Securities
and (iii) engaging in only those other activities necessary or incidental
thereto. All of the Common Securities will be directly or indirectly owned by
the Company. The Common Securities will rank PARI PASSU, and payments will be
made thereon PRO RATA, with the Preferred Securities, except that, upon an event
of default under the Declaration, the rights of the holders of the Common
Securities to payment in respect of distributions and payments upon liquidation,
redemption and otherwise will be subordinated to the rights of the holders of
the Preferred Securities. The Company will directly or indirectly acquire Common
Securities in an aggregate liquidation amount equal to 3% or more of the total
capital of each TRV Trust.
Each TRV Trust has a term of approximately 55 years but may terminate
earlier, as provided in each Declaration. Each TRV Trust's business and affairs
will be conducted by the trustees of each applicable Trust (the "TRV Trustees")
appointed by the Company as the direct or indirect holder of all the Common
Securities. The holder of the Common Securities will be entitled to appoint,
remove or replace any of, or increase or reduce the number of, the TRV Trustees
of the TRV Trusts. The duties and obligations of the TRV Trustees shall be
governed by the Declaration of such TRV Trust. Each TRV Trust will have two TRV
Trustees (the "Regular Trustees") who are employees or officers of or who are
affiliated with the Company. One TRV Trustee of each TRV Trust will be a
financial institution that is not affiliated with the Company and that has a
specified minimum amount of aggregate capital, surplus, and undivided profits of
not less than $50,000,000, which shall act as property trustee and as indenture
trustee for the purposes of compliance with the provisions of Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"), pursuant to the terms set
forth in a Prospectus Supplement (the "Institutional Trustee"). In addition,
unless the Institutional Trustee maintains a principal place of business in the
State of Delaware and otherwise meets the requirements of applicable law, one
TRV Trustee of each TRV Trust will have a principal place of business or reside
in the State of
5
<PAGE>
Delaware (the "Delaware Trustee"). The Company will pay all fees and expenses
related to the TRV Trusts and the offering of the Trust Securities.
The office of the Delaware Trustee for each of the TRV Trusts is Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801. The
address for each TRV Trust is c/o the Company, the Sponsor of the TRV Trusts, at
the Company's corporate headquarters located at 388 Greenwich Street, New York,
New York 10013, telephone (212) 816-8000.
USE OF PROCEEDS
All of the net proceeds from the sale of any Preferred Securities offered
hereby will be invested by the TRV Trust in Junior Subordinated Debt Securities.
The Company will use the proceeds from the sale of the Junior Subordinated Debt
Securities to the TRV Trusts, and the proceeds from the sale of any Preferred
Stock or Depositary Shares offered hereby, for general corporate purposes, which
may include capital contributions to subsidiaries of the Company, the redemption
of shares of the Company's preferred stock, and/or the reduction or refinancing
of borrowings of the Company or its subsidiaries.
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
THREE MONTHS ENDED --------------------------------------------
MARCH 31, 1997 1996 1995 1994 1993
----------------------- --------- --------- --------- -----------
<S> <C> <C> <C> <C> <C>
Ratio of earnings to combined fixed charges and preferred
stock dividends 2.45 2.30 2.09 2.12 2.64
<CAPTION>
1992
---------
<S> <C>
Ratio of earnings to combined fixed charges and preferred
stock dividends 2.57
</TABLE>
The ratio of earnings to combined fixed charges and preferred stock
dividends has been computed by dividing earnings from continuing operations
before income taxes and fixed charges by the combined fixed charges and
preferred stock dividends. For purposes of these ratios, fixed charges consist
of interest expense and that portion of rentals deemed representative of the
appropriate interest factor.
6
<PAGE>
DESCRIPTION OF JUNIOR SUBORDINATED DEBT SECURITIES
The following description sets forth certain general terms and provisions of
the Junior Subordinated Debt Securities to which any Prospectus Supplement may
relate. The particular terms of the Junior Subordinated Debt Securities offered
by any Prospectus Supplement and the extent, if any, to which such general
provisions may apply to the Junior Subordinated Debt Securities so offered will
be described in the Prospectus Supplement relating to such Junior Subordinated
Debt Securities.
The Junior Subordinated Debt Securities may be issued, from time to time, in
one or more series, under an Indenture, dated as of October 7, 1996 (the
"Indenture"), between the Company and The Chase Manhattan Bank, as trustee (the
"Indenture Trustee"), the form of which is filed as an exhibit to the
Registration Statement of which this Prospectus forms a part.
The following summary of certain provisions of the Junior Subordinated Debt
Securities and the Indenture does not purport to be complete and is subject to,
and is qualified in its entirety by express reference to, all of the provisions
of the Indenture, including the definitions therein of certain terms. All
article and section references appearing herein are to articles and sections of
the Indenture, unless otherwise indicated, and capitalized terms which are not
otherwise defined in this Prospectus shall have the meanings specified in the
Indenture.
GENERAL. The Junior Subordinated Debt Securities will be direct, unsecured
obligations of the Company. The Indenture does not limit the amount of Junior
Subordinated Debt Securities which may be issued thereunder, and provides that
Junior Subordinated Debt Securities may be issued thereunder in series up to the
aggregate principal amount which may be authorized from time to time by the
Board of Directors of the Company. (Section 3.1)
Reference is made to the Prospectus Supplement relating to the particular
series of Junior Subordinated Debt Securities being offered thereby for the
following terms and other information: (i) the designation, priority, aggregate
principal amount and authorized denominations; (ii) the percentage of their
principal amount at which such Junior Subordinated Debt Securities will be
issued; (iii) the date on which such Junior Subordinated Debt Securities will
mature; (iv) the rate per annum at which such Junior Subordinated Debt
Securities will bear interest or the method of determination of such rate; (v)
the dates on which such interest will be payable; (vi) the rights, if any, to
defer payments of interest on the Junior Subordinated Debt Securities by
extending the interest payment period, and the maximum duration of such
extensions; (vii) the place or places where payments on such Junior Subordinated
Debt Securities shall be made; (viii) any redemption terms or sinking fund
provisions; (ix) the terms of subordination of Junior Subordinated Debt
Securities; (x) whether Debt Securities issued in fully registered form will be
represented by either a global security delivered to a depositary and recorded
in a book-entry system maintained by such depositary or by a certificate
delivered to the Holder; (xi) the restrictions, if any, applicable to the
exchange of Junior Subordinated Debt Securities of a series of one form for
another of such series and to the offer, sale and delivery of the Junior
Subordinated Debt Securities; (xii) whether and under what circumstances the
Company will pay additional amounts in the event of certain developments with
respect to United States withholding tax or information reporting laws; or
(xiii) other specific terms.
Unless otherwise specified in the applicable Prospectus Supplement, Junior
Subordinated Debt Securities will be issued in fully registered form without
coupons, will be exchangeable for other Junior Subordinated Debt Securities of
the same series, registered in the same name, for a like aggregate principal
amount in authorized denominations, and will be transferable at any time or from
time to time at the Corporate Trust Office of the Indenture Trustee or at any
other office or agency of the Company maintained for that purpose. No charge
will be made to the Holder for any such exchange or transfer except for any tax
or governmental charge incidental thereto.
Unless otherwise described in the applicable Prospectus Supplement, there
are no covenants or provisions contained in the Indenture which afford the
Holders of the Junior Subordinated Debt Securities protection in the event of a
highly leveraged transaction involving the Company.
CONSOLIDATION, MERGER AND SALE OF ASSETS. The Indenture provides that the
Company will not consolidate with or merge into any other corporation or convey,
transfer or lease its assets substantially as an entirety unless (a) the
successor is a corporation organized in the United States and expressly assumes
the due and punctual payment of the principal of (and premium, if any) and
interest on all Junior Subordinated Debt Securities issued thereunder and the
performance of every other covenant of the Indenture on the part of the Company
and (b) immediately thereafter no Event of Default and no event which, after
notice or lapse of time, or both, would become an Event of Default, shall have
happened and be continuing. Upon any such consolidation, merger, conveyance or
transfer, the successor
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corporation shall succeed to and be substituted for the Company under the
Indenture and thereafter the predecessor corporation shall be relieved of all
obligations and covenants under the Indenture and the Junior Subordinated Debt
Securities. (Article Eight)
EVENTS OF DEFAULT. The Indenture provides that the following are Events of
Default thereunder with respect to any series of the Junior Subordinated Debt
Securities: (a) default in the payment of the principal of (or premium, if any,
on) any Junior Subordinated Debt Security of such series at its maturity; (b)
default in making a sinking fund payment, if any, when and as the same shall be
due and payable by the terms of the Junior Subordinated Debt Securities of such
series; (c) default for 30 days in the payment of any installment of interest on
any Junior Subordinated Debt Security of such series; (d) default for 90 days
after written notice in the performance of any other covenant in respect of the
Junior Subordinated Debt Securities of such series contained in the Indenture;
(e) certain events of bankruptcy, insolvency or reorganization, or court
appointment of a receiver, liquidator or trustee of the Company; (f) any other
Event of Default provided in the applicable resolution of the Board of Directors
or supplemental indenture under which the Junior Subordinated Debt Securities
are issued; and (g) in the event Junior Subordinated Debt Securities of a series
are issued and sold to a TRV Trust or a trustee of such trust in connection with
the issuance of Trust Securities by such TRV Trust, such TRV Trust shall have
voluntarily or involuntarily dissolved, wound-up its business or otherwise
terminated its existence, except in connection with (i) the distribution of
Junior Subordinated Debt Securities to holders of Trust Securities in
liquidation or redemption of their interests in such TRV Trust upon a Special
Event, (ii) the redemption of all of the outstanding Trust Securities of such
TRV Trust or (iii) certain mergers, consolidations or amalgamations, each as
permitted by the Declaration of such TRV Trust. (Section 5.1) The Indenture
Trustee may withhold notice to the Holders of the Junior Subordinated Debt
Securities of any default with respect thereto (except in the payment of
principal, premium or interest) if it considers such withholding to be in the
interests of such Holders. (Section 6.2)
If an Event of Default with respect to the Junior Subordinated Debt
Securities shall have occurred and be continuing, the Indenture Trustee or the
Holders of 25% in aggregate principal amount of the Junior Subordinated Debt
Securities may declare the principal of all the Junior Subordinated Debt
Securities to be due and payable immediately. (Section 5.2)
The Indenture contains a provision entitling the Indenture Trustee to be
indemnified by the Holders before proceeding to exercise any right or power
under the Indenture at the request of any of the Holders. (Section 6.3). The
Indenture provides that the Holders of a majority in principal amount of the
outstanding Junior Subordinated Debt Securities may direct the time, method and
place of conducting any proceeding for any remedy available to the Indenture
Trustee, or exercising any trust or power conferred upon the Indenture Trustee,
with respect to the Junior Subordinated Debt Securities. (Section 5.12) The
right of a Holder to institute a proceeding with respect to the Indenture is
subject to certain conditions precedent including notice and indemnity to the
Indenture Trustee, but the Holder has an absolute right to receipt of principal,
premium, if any, and interest on the Junior Subordinated Debt Securities at the
Stated Maturity (or, in the case of redemption, on the Redemption Date) or to
institute suit for the enforcement thereof. (Sections 5.7 and 5.8)
The Holders of not less than a majority in principal amount of the
Outstanding Junior Subordinated Debt Securities may on behalf of the Holders of
all the Junior Subordinated Debt Securities waive any past defaults except (a) a
default in payment of the principal of (or premium, if any) or interest on any
Junior Subordinated Debt Security and (b) a default in respect of a covenant or
provision of the Indenture which cannot be amended or modified without the
consent of the Holder of each affected Junior Subordinated Debt Security;
PROVIDED, HOWEVER, that if the Junior Subordinated Debt Securities are held by a
TRV Trust or a trustee of such trust, such waiver or modification to such waiver
shall not be effective until the holders of a majority in liquidation preference
of Trust Securities of the applicable TRV Trust shall have consented to such
waiver or modification to such waiver; PROVIDED FURTHER, that if the consent of
the Holder of each outstanding Junior Subordinated Debt Security is required,
such waiver shall not be effective until each holder of the Trust Securities of
the applicable TRV Trust shall have consented to such waiver. (Section 5.13)
The Indenture requires the Company to furnish to the Indenture Trustee an
annual statement as to defaults, if any, by the Company under the Indenture.
(Section 10.4)
MODIFICATIONS AND AMENDMENTS. Modifications and amendments to the Indenture
may be made by the Company and the Indenture Trustee with the consent of the
Holders of a majority in principal amount of the Junior Subordinated Debt
Securities at the time outstanding of each series which is affected thereby,
PROVIDED, that no such
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modification or amendment may, without the consent of the Holder of each Junior
Subordinated Debt Security affected thereby: (i) modify the terms of payment of
principal, premium, if any, or interest or; or (ii) reduce the percentage of
Holders of Junior Subordinated Debt Securities necessary to modify or amend the
Indenture or waive compliance by the Company with any covenant or past default,
PROVIDED, FURTHER, that if the Junior Subordinated Debt Securities of such
series are held by a TRV Trust or a trustee of such trust, such supplemental
indenture shall not be effective until the holders of a majority in liquidation
preference of Trust Securities of the applicable TRV Trust shall have consented
to such supplemental indenture; PROVIDED FURTHER, that if the consent of the
Holder of each outstanding Junior Subordinated Debt Security is required, such
supplemental indenture shall not be effective until each holder of the Trust
Securities of the applicable TRV Trust shall have consented to such supplemental
indenture. (Section 9.2)
DISCHARGE AND DEFEASANCE. The Company may discharge all of its obligations
(except those set forth below) to holders of any series of Junior Subordinated
Debt Securities issued under the Indenture, which Junior Subordinated Debt
Securities have not already been delivered to the Indenture Trustee for
cancellation and which either have become due and payable or are by their terms
due and payable within one year (or are to be called for redemption within one
year) by depositing with the Indenture Trustee an amount certified to be
sufficient to pay when due the principal of and premium, if any, and interest on
all outstanding Junior Subordinated Debt Securities of such series and to make
any mandatory sinking fund payments thereon when due. (Section 4.1)
Unless otherwise specified in the applicable Prospectus Supplement with
respect to the Junior Subordinated Debt Securities of a series, the Company, at
its option, (i) will be discharged from any and all obligations in respect of
the Junior Subordinated Debt Securities of such series (except for certain
obligations to pay all expenses of the applicable TRV Trust, to register the
transfer or exchange of Junior Subordinated Debt Securities of such series, to
replace mutilated, defaced, destroyed, lost or stolen Junior Subordinated Debt
Securities of such series, and to maintain Paying Agents and hold monies for
payment in trust), or (ii) need not comply with certain covenants specified in
the applicable Prospectus Supplement with respect to the Junior Subordinated
Debt Securities of that series, and the occurrence of an event described in
clause (d) under "Events of Default" above with respect to any defeased covenant
and clause (f) of the "Events of Default" above shall no longer be an Event of
Default if, in either case, the Company deposits with the Indenture Trustee, in
trust, money or U.S. Government Obligations that through the payment of interest
thereon and principal thereof in accordance with their terms will provide money
in an amount sufficient to pay all the principal of (and premium, if any) and
any interest on the Junior Subordinated Debt Securities of such series on the
dates such payments are due (which may include one or more redemption dates
designated by the Company) in accordance with the terms of such Junior
Subordinated Debt Securities. Such a trust may only be established, if, among
other things, the Company shall have delivered an Opinion of Counsel, which, in
the case of a discharge pursuant to clause (i), must be based upon a ruling or
administrative pronouncement of the Internal Revenue Service, to the effect that
the Holders of the Junior Subordinated Debt Securities will not recognize gain
or loss for federal income tax purposes as a result of such deposit or
defeasance and will be subject to federal income tax in the same manner as if
such defeasance had not occurred. (Sections 4.2, 4.3 and 4.4) In the event the
Company omits to comply with its remaining obligations under the Indenture after
a defeasance of the Indenture with respect to the Junior Subordinated Debt
Securities of any series as described under clause (ii) above and the Junior
Subordinated Debt Securities of such series are declared due and payable because
of the occurrence of any undefeased Event of Default, the amount of money and
U.S. Government Obligations on deposit with the Indenture Trustee may be
insufficient to pay amounts due on the Junior Subordinated Debt Securities of
such series at the time of the acceleration resulting from such Event of
Default. However, the Company will remain liable in respect of such payments.
CONCERNING THE INDENTURE TRUSTEE. The Indenture Trustee has extended
substantial credit facilities (the borrowings under which constitute Senior
Indebtedness) to the Company. The Company and certain of its subsidiaries also
maintain bank accounts, borrow money and have other customary commercial banking
or investment banking relationships with the Indenture Trustee in the ordinary
course of business.
GLOBAL SECURITIES. The Indenture provides that the registered Junior
Subordinated Debt Securities of a series may be issued in the form of one or
more fully registered Global Securities (a "Registered Global Security") that
will be deposited with a depositary (a "Depositary") or with a nominee for a
Depositary identified in the Prospectus Supplement relating to such series and
registered in the name of the Depositary or a nominee thereof. (Section 3.1) In
such case, one or more Registered Global Securities will be issued in a
denomination or aggregate denominations equal to the portion of the aggregate
principal amount of outstanding registered Junior Subordinated Debt Securities
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to be represented by such Registered Global Security or Securities. Unless and
until it is exchanged in whole for Junior Subordinated Debt Securities in
definitive registered form, a Registered Global Security may not be transferred
except as a whole by the Depositary for such Registered Global Security to a
nominee of such Depositary or by a nominee of such Depositary to such Depositary
or another nominee of such Depositary or by such Depositary or any such nominee
to a successor of such Depositary or a nominee of such successor. The Depositary
currently accepts only debt securities that are payable in U.S. dollars.
The specific terms of the depositary arrangement with respect to any portion
of a series of Junior Subordinated Debt Securities to be represented by a
Registered Global Security will be described in the Prospectus Supplement
relating to such series.
Ownership of beneficial interests in a Registered Global Security will be
limited to persons that have accounts with the Depositary for such Registered
Global Security ("participants") or persons that may hold interests through
participants. Upon the issuance of a Registered Global Security, the Depositary
for such Registered Global Security will credit, on its book-entry registration
and transfer system, the participants' accounts with the respective principal
amounts of the Debt Securities represented by such Registered Global Security
beneficially owned by such participants. The accounts to be credited shall be
designated by any dealers, underwriters or agents participating in the
distribution of such Junior Subordinated Debt Securities. Ownership of
beneficial interests in such Registered Global Security will be shown on, and
the transfer of such ownership interests will be effected only through, records
maintained by the Depositary for such Registered Global Security (with respect
to interests of participants) and on the records of participants (with respect
to interests of persons holding through participants). The laws of some states
may require that certain purchasers of securities take physical delivery of such
securities in definitive form. Such limits and such laws may impair the ability
to own, transfer or pledge beneficial interests in Registered Global Securities.
So long as the Depositary for a Registered Global Security, or its nominee,
is the registered owner of such Registered Global Security, such Depositary or
such nominee, as the case may be, will be considered the sole owner or holder of
the Junior Subordinated Debt Securities represented by such Registered Global
Security for all purposes under the Indenture. Except as set forth below, owners
of beneficial interests in a Registered Global Security will not be entitled to
have the Junior Subordinated Debt Securities represented by such Registered
Global Security registered in their names, will not receive or be entitled to
receive physical delivery of such Junior Subordinated Debt Securities in
definitive form and will not be considered the owners or holders thereof under
the Indenture. Accordingly, each person owning a beneficial interest in a
Registered Global Security must rely on the procedures of the Depositary for
such Registered Global Security and, if such person is not a participant, on the
procedures of the participant through which such person owns its interest, to
exercise any rights of a holder under the Indenture. The Company understands
that under existing industry practices, if the Company requests any action of
holders or if an owner of a beneficial interest in a Registered Global Security
desires to give or take any action which a holder is entitled to give or take
under the Indenture, the Depositary for such Registered Global Security would
authorize the participants holding the relevant beneficial interests to give or
take such action, and such participants would authorize beneficial owners owning
through such participants to give or take such action or would otherwise act
upon the instructions of beneficial owners holding through them.
Principal, premium, if any, and interest payments on Junior Subordinated
Debt Securities represented by a Registered Global Security registered in the
name of a Depositary or its nominee will be made to such Depositary or its
nominee, as the case may be, as the registered owner of such Registered Global
Security. None of the Company, the Indenture Trustee or any other agent of the
Company or agent of the Indenture Trustee will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests in such Registered Global Security or for
maintaining, supervising or reviewing any records relating to such beneficial
ownership interests.
The Company expects that the Depositary for any Junior Subordinated Debt
Securities represented by a Registered Global Security, upon receipt of any
payment of principal, premium or interest in respect of such Registered Global
Security, will immediately credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests in such
Registered Global Security as shown on the records of such Depositary. The
Company also expects that payments by participants to owners of beneficial
interests in such Registered Global Security held through such participants will
be governed by standing customer instructions and customary practices, as is now
the case with the securities held for the accounts of customers in bearer form
or registered in "street name," and will be the responsibility of such
participants.
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If the Depositary for any Junior Subordinated Debt Securities represented by
a Registered Global Security is at any time unwilling or unable to continue as
Depositary or ceases to be a clearing agency registered under the Exchange Act,
and a successor Depositary registered as a clearing agency under the Exchange
Act is not appointed by the Company within 90 days, the Company will issue such
Junior Subordinated Debt Securities in definitive form in exchange for such
Registered Global Security. In addition, the Company may at any time and in its
sole discretion determine not to have any of the Junior Subordinated Debt
Securities of a series represented by one or more Registered Global Securities
and, in such event, will issue Junior Subordinated Debt Securities of such
series in definitive form in exchange for all of the Registered Global Security
or Securities representing such Junior Subordinated Debt Securities. Any Junior
Subordinated Debt Securities issued in definitive form in exchange for a
Registered Global Security will be registered in such name or names as the
Depositary shall instruct the relevant Trustee. It is expected that such
instructions will be based upon directions received by the Depositary from
participants with respect to ownership of beneficial interests in such
Registered Global Security.
The Junior Subordinated Debt Securities of a series may also be issued in
the form of one or more bearer global Securities (a "Bearer Global Security")
that will be deposited with a common depositary for Euroclear and Cedel Bank,
societe anonyme, or with a nominee for such depositary identified in the
Prospectus Supplement relating to such series. The specific terms and
procedures, including the specific terms of the depositary arrangement, with
respect to any portion of a series of Junior Subordinated Debt Securities to be
represented by a Bearer Global Security will be described in the Prospectus
Supplement relating to such series.
RANKING OF JUNIOR SUBORDINATED DEBT SECURITIES. The Junior Subordinated
Debt Securities will be subordinated and junior in right of payment to certain
indebtedness of the Company to the extent set forth in the Prospectus Supplement
that will accompany this Prospectus.
CERTAIN PROVISIONS APPLICABLE TO TRV TRUSTS. In the event Junior
Subordinated Debt Securities of a series are issued and sold to a TRV Trust or a
trustee of such trust in connection with the issuance of Trust Securities by
such TRV Trust, such Junior Subordinated Debt Securities subsequently may be
distributed PRO RATA to the holders of such Trust Securities in connection with
the dissolution of such TRV Trust upon the occurrence of certain events
described in the Prospectus Supplement relating to such Trust Securities. Only
one series of Junior Subordinated Debt Securities will be issued to a TRV Trust,
or a trustee of such trust, in connection with the issuance of Trust Securities
by such TRV Trust. If Junior Subordinated Debt Securities are issued to a TRV
Trust or a trustee of such trust in connection with the issuance of Trust
Securities by such TRV Trust and (i) there shall have occurred and be continuing
an Event of Default, (ii) the Company shall be in default with respect to its
payment of any obligations under the related Guarantee, or (iii) the Company
shall have given notice of its election to defer payments of interest on such
Junior Subordinated Debt Securities by extending the interest payment period as
provided in the Indenture and such period, or any extension thereof, shall be
continuing, then (a) the Company shall not declare or pay any dividend on, make
any distributions with respect to, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of its capital stock or make any
guarantee payment with respect thereto (other than (i) repurchases, redemptions
or other acquisitions of shares of capital stock of the Company in connection
with any employment contract, benefit plan or other similar arrangement with or
for the benefit of employees, officers, directors or consultants, (ii) as a
result of an exchange or conversion of any class or series of the Company's
capital stock for any other class or series of the Company's capital stock, or
(iii) the purchase of fractional interests in shares of the Company's capital
stock pursuant to the conversion or exchange provisions of such capital stock or
the security being converted or exchanged), and (b) the Company shall not make
any payment of interest on or principal of (or premium, if any, on), or repay,
repurchase or redeem any debt securities issued by the Company which rank PARI
PASSU with or junior to such Junior Subordinated Debt Securities. The foregoing,
however, will not apply to any stock dividends paid by the Company where the
dividend stock is the same stock as that on which the dividend is being paid.
In the event Junior Subordinated Debt Securities are issued to a TRV Trust
or a trustee of such trust in connection with the issuance of Trust Securities
of such TRV Trust, for so long as such Trust Securities remain outstanding, the
Company will covenant (i) to directly or indirectly maintain 100% ownership of
the Common Securities of such TRV Trust; PROVIDED, HOWEVER, that any permitted
successor of the Company under the Indenture may succeed to the Company's
ownership of such Common Securities, (ii) to not voluntarily dissolve, wind-up
or terminate such TRV Trust, except in connection with a distribution of Junior
Subordinated Debt Securities upon a Special Event and in connection with certain
mergers, consolidations or amalgamations permitted by the Declaration of the
applicable TRV Trust, (iii) to timely perform its duties as Sponsor of the
applicable TRV Trust and (iv) to use its reasonable efforts to cause such TRV
Trust (a) to remain a statutory business trust, except in connection with the
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distribution of Junior Subordinated Debt Securities to the holders of Trust
Securities in liquidation of such TRV Trust, the redemption of all of the Trust
Securities of such TRV Trust, or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration of such TRV Trust, and (b)
to otherwise continue to be classified as a grantor trust for United States
federal income tax purposes. (Section 10.5)
DESCRIPTION OF PREFERRED SECURITIES
The following description sets forth certain general terms and provisions of
the Preferred Securities to which any Prospectus Supplement may relate. The
particular terms of the Preferred Securities offered by any Prospectus
Supplement and the extent, if any, to which such general provisions may apply to
the Preferred Securities so offered will be described in the Prospectus
Supplement relating to such Preferred Securities. The description does not
purport to be complete and is subject in all respects to the provisions of, and
is qualified in its entirety by reference to, the forms of Declarations, which
are filed as exhibits to the Registration Statement of which this Prospectus
forms a part.
Each TRV Trust may issue, from time to time, only one series of Preferred
Securities having terms described in the Prospectus Supplement relating thereto.
The Declaration of each TRV Trust authorizes the Regular Trustees of such TRV
Trust to issue on behalf of such TRV Trust one series of Preferred Securities.
Each Declaration has been or will be qualified as an indenture under the Trust
Indenture Act. The Preferred Securities will have such terms, including
distributions, redemption, voting, liquidation rights and such other preferred,
deferred or other special rights or such restrictions as shall be set forth in
the Declaration of the TRV Trust issuing such Preferred Securities or made part
of such Declaration by the Trust Indenture Act. Reference is made to any
Prospectus Supplement relating to the Preferred Securities of a TRV Trust for
specific terms, including (i) the distinctive designation of such Preferred
Securities, (ii) the number of Preferred Securities issued by such TRV Trust,
(iii) the annual distribution rate (or method of determining such rate) for
Preferred Securities issued by such TRV Trust and the date or dates upon which
such distributions shall be payable, (iv) whether distributions on Preferred
Securities issued by such TRV Trust shall be cumulative, and, in the case of
Preferred Securities having such cumulative distribution rights, the date or
dates or method of determining the date or dates from which distributions on
Preferred Securities issued by such TRV Trust shall be cumulative, (v) the
amount or amounts which shall be paid out of the assets of such TRV Trust to the
Holders of Preferred Securities of such TRV Trust upon voluntary or involuntary
dissolution, winding-up or termination of such TRV Trust, (vi) the obligation,
if any, of such TRV Trust to purchase or redeem Preferred Securities issued by
such TRV Trust and the price or prices at which, the period or periods within
which and the terms and conditions upon which Preferred Securities issued by
such TRV Trust shall be purchased or redeemed, in whole or in part, pursuant to
such obligation, (vii) the voting rights, if any, of Preferred Securities issued
by such TRV Trust in addition to those required by law, including the number of
votes per Preferred Security and any requirement for the approval by the holders
of Preferred Securities, or of Preferred Securities issued by one or more TRV
Trusts, or of both, as a condition to specified action or amendments to the
Declaration of such TRV Trust, and (viii) any other relevant rights,
preferences, privileges, limitations or restrictions of Preferred Securities
issued by such TRV Trust consistent with the Declaration of such TRV Trust or
with applicable law. All Preferred Securities offered hereby will be guaranteed
by the Company to the extent set forth below under "Description of Guarantees."
Certain United States federal income tax considerations applicable to any
offering of Preferred Securities will be described in the Prospectus Supplement
relating thereto.
In connection with the issuance of Preferred Securities, each TRV Trust will
issue one series of Common Securities. The Declaration of each TRV Trust
authorizes the Regular Trustees of such trust to issue on behalf of such TRV
Trust one series of Common Securities having such terms including distributions,
redemption, voting, liquidation rights or such restrictions as shall be set
forth therein. The terms of the Common Securities issued by such TRV Trust will
be substantially identical to the terms of the Preferred Securities issued by
such TRV Trust and the Common Securities will rank PARI PASSU, and payments will
be made thereon PRO RATA with such Preferred Securities except that, upon an
Event of Default under the Declaration of such TRV Trust, the rights of the
holders of such Common Securities to payment in respect of distributions and
payments upon liquidation, redemption and otherwise will be subordinated to the
rights of the holders of such Preferred Securities. Except in certain limited
circumstances, the Common Securities of a TRV Trust will also carry the right to
vote and to appoint, remove or replace any of the TRV Trustees of such TRV
Trust. All of the Common Securities of a TRV Trust will be directly or
indirectly owned by the Company.
If an Event of Default with respect to a Declaration of any TRV Trust occurs
and is continuing, then the holders of Preferred Securities of such TRV Trust
would rely on the enforcement by the Institutional Trustee of its rights as a
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holder of the Junior Subordinated Debt Securities against the Company. In
addition, the holders of a majority in liquidation amount of such Preferred
Securities will have the right to direct the time, method, and place of
conducting any proceeding for any remedy available to the Institutional Trustee
or to direct the exercise of any trust or power conferred upon the Institutional
Trustee under such Declaration, including the right to direct the Institutional
Trustee to exercise the remedies available to it as a holder of the Junior
Subordinated Debt Securities. If the Institutional Trustee fails to enforce its
rights under the Junior Subordinated Debt Securities, any holder of such
Preferred Securities may directly institute a legal proceeding against the
Company to enforce the Institutional Trustee's rights under the Junior
Subordinated Debt Securities without first instituting any legal proceeding
against the Institutional Trustee or any other person or entity. If an Event of
Default with respect to the Declaration of any TRV Trust has occurred and is
continuing and such event is attributable to the failure of the Company to pay
interest or principal on the Junior Subordinated Debt Securities on the date
such interest or principal is otherwise payable (or in the case of redemption,
on the redemption date), then a holder of Preferred Securities of such TRV Trust
may also directly institute a proceeding for enforcement of payment to such
holder of the principal of or interest on the Junior Subordinated Debt
Securities having a principal amount equal to the aggregate liquidation amount
of such Preferred Securities of such holder (a "Direct Action") on or after the
respective due date specified in the Junior Subordinated Debt Securities without
first (i) directing the Institutional Trustee to enforce the terms of the Junior
Subordinated Debt Securities or (ii) instituting a legal proceeding against the
Company to enforce the Institutional Trustee's Rights under the Junior
Subordinated Debt Securities. In connection with such Direct Action, the Company
will be subrogated to the rights of such holder of such Preferred Securities
under such Declaration to the extent of any payment made by the Company to such
holder of such Preferred Securities in such Direct Action. Consequently, the
Company will be entitled to payment of amounts that a holder of Preferred
Securities receives in respect of an unpaid distribution that resulted in the
bringing of a Direct Action to the extent that such holder receives or has
already received full payment with respect to such unpaid distribution from a
TRV Trust. The holders of Preferred Securities of a TRV Trust will not be able
to exercise directly any other remedy available to the holders of the Junior
Subordinated Debt Securities.
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DESCRIPTION OF GUARANTEES
Set forth below is a summary of information concerning the Guarantees that
will be executed and delivered by the Company for the benefit of the holders,
from time to time, of Preferred Securities. Each Guarantee will be qualified as
an indenture under the Trust Indenture Act. The Chase Manhattan Bank will act as
indenture trustee under each Guarantee (the "Guarantee Trustee"). The terms of
each Guarantee will be those set forth in such Guarantee and those made part of
such Guarantee by the Trust Indenture Act. The summary does not purport to be
complete and is subject in all respects to the provisions of, and is qualified
in its entirety by reference to, the form of Guarantee, which is filed as an
exhibit to the Registration Statement of which this Prospectus forms a part, and
the Trust Indenture Act. Each Guarantee will be held by the Guarantee Trustee
for the benefit of the holders of the Preferred Securities of a TRV Trust.
GENERAL
Pursuant to and to the extent set forth in each Guarantee, and except as
otherwise set forth in the applicable Prospectus Supplement, the Company will
irrevocably and unconditionally agree to pay in full to the holders of the
Preferred Securities issued by a TRV Trust (except to the extent paid by such
TRV Trust), as and when due, regardless of any defense, right of set-off or
counterclaim which such TRV Trust may have or assert, the following payments
(the "Guarantee Payments"), without duplication: (i) any accrued and unpaid
distributions that are required to be paid on such Preferred Securities, to the
extent such TRV Trust has funds available therefor, and (ii) the redemption
price per Preferred Security set forth in the applicable Prospectus Supplement,
which will not be lower than the stated liquidation amount, plus all accrued and
unpaid distributions (the "Redemption Price"), to the extent such TRV Trust has
funds available therefor, with respect to any Preferred Securities called for
redemption by such TRV Trust, and (iii) upon a voluntary or involuntary
dissolution, winding-up or termination of such TRV Trust (other than in
connection with the distribution of Junior Subordinated Debt Securities to the
holders of Preferred Securities or the redemption of all of the Preferred
Securities) the lesser of (a) the aggregate of the liquidation amount and all
accrued and unpaid distributions on such Preferred Securities to the date of
payment or (b) the amount of assets of such TRV Trust remaining for distribution
to holders of such Preferred Securities in liquidation of such TRV Trust. The
Company's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Company to the holders of Preferred
Securities or by causing such TRV Trust to pay such amounts to such holders.
Each Guarantee will be a guarantee on a subordinated basis with respect to
the Preferred Securities issued by a TRV Trust from the time of issuance of such
Preferred Securities but will not apply to any payment of distributions or
Redemption Price, or to payments upon the dissolution, winding-up or termination
of such TRV Trust, except to the extent such TRV Trust shall have funds
available therefor. If the Company does not make interest payments on the Junior
Subordinated Debt Securities purchased by a TRV Trust, such TRV Trust will not
pay distributions on the Preferred Securities issued by such TRV Trust and will
not have funds available therefor. See "Description of Junior Subordinated Debt
Securities." The Guarantee, when taken together with the Company's obligations
under the Junior Subordinated Debt Securities, the Indenture and the Declaration
of any TRV Trust, including its obligations to pay costs, expenses, debts and
liabilities of such TRV Trust (other than with respect to Trust Securities) will
provide a full and unconditional guarantee on a subordinated basis by the
Company of payments due on the Preferred Securities issued by such TRV Trust.
CERTAIN COVENANTS OF THE COMPANY
In each Guarantee, the Company will covenant that, so long as any Preferred
Securities issued by a TRV Trust remain outstanding, if there shall have
occurred any event that would constitute an Event of Default under such
Guarantee or the Declaration of such TRV Trust, then (a) the Company shall not
declare or pay any dividend on, make any distributions with respect to, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
its capital stock or make any guarantee payment with respect thereto (other than
(i) repurchases, redemptions or other acquisitions of shares of capital stock of
the Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of employees, officers, directors or
consultants, (ii) as a result of an exchange or conversion of any class or
series of the Company's capital stock for any other class or series of the
Company's capital stock, or (iii) the purchase of fractional interests in shares
of the Company's capital stock pursuant to the conversion or exchange provisions
of such capital stock or the security being converted or exchanged) and (b) the
Company shall not make any payment of interest on, or principal of (or premium,
if any, on), or repay,
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repurchase or redeem, any debt securities issued by the Company which rank PARI
PASSU with or junior to such Junior Subordinated Debt Securities. Each
Guarantee, however, will except from the foregoing any stock dividends paid by
the Company where the dividend stock is the same stock as that on which the
dividend is being paid.
MODIFICATION OF THE GUARANTEES; ASSIGNMENT
Except with respect to any changes that do not adversely affect the rights
of holders of Preferred Securities to which a Guarantee relates (in which case
no vote will be required), each Guarantee may be amended only with the prior
approval of the holders of not less than a majority in aggregate liquidation
amount of the outstanding related Preferred Securities issued by a TRV Trust.
The manner of obtaining any such approval of holders of such Preferred
Securities will be set forth in an accompanying Prospectus Supplement. All
guarantees and agreements contained in a Guarantee shall bind the successors,
assignees, receivers, trustees and representatives of the Company and shall
inure to the benefit of the holders of the related Preferred Securities of a TRV
Trust then outstanding.
EVENTS OF DEFAULT
An Event of Default under a Guarantee will occur upon the failure of the
Company to perform any of its payment or other obligations thereunder. The
holders of a majority in aggregate liquidation amount of the Preferred
Securities to which a Guarantee relates have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Guarantee Trustee in respect of the Guarantee or to direct the exercise of any
trust or power conferred upon the Guarantee Trustee under the Guarantee. If the
Guarantee Trustee fails to enforce the Guarantee Trustee's rights under a
Guarantee, any holder of related Preferred Securities may directly institute a
legal proceeding against the Company to enforce the Guarantee Trustee's rights
under such Guarantee without first instituting a legal proceeding against the
TRV Trust that issued such Preferred Securities, the Guarantee Trustee or any
other person or entity. A holder of Preferred Securities may also directly
institute a legal proceeding against the Company to enforce such holder's right
to receive payment under such Guarantee without first (i) directing the
Guarantee Trustee to enforce the terms of the Guarantee or (ii) instituting a
legal proceeding against the TRV Trust that issued such Preferred Securities or
any other person or entity.
The Company will be required to provide annually to the Guarantee Trustee a
statement as to the performance by the Company of certain of its obligations
under each of the Guarantees and as to any default in such performance.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, prior to the occurrence of a default with respect to
a Guarantee, undertakes to perform only such duties as are specifically set
forth in the Guarantee and, after default with respect to a Guarantee, shall
exercise the same degree of care as a prudent individual would exercise in the
conduct of his or her own affairs. Subject to such provision, the Guarantee
Trustee is under no obligation to exercise any of the powers vested in it by a
Guarantee at the request of any holder of Preferred Securities to which such
Guarantee relates unless it is offered reasonable indemnity against the costs,
expenses and liabilities that might be incurred thereby.
TERMINATION OF THE GUARANTEES
Each Guarantee will terminate as to the Preferred Securities issued by a TRV
Trust upon full payment of the Redemption Price of all Preferred Securities of
such TRV Trust, upon distribution of the Junior Subordinated Debt Securities
held by such TRV Trust to the holders of the Preferred Securities of such TRV
Trust or upon full payment of the amounts payable in accordance with the
Declaration of such TRV Trust upon liquidation of such TRV Trust. Each Guarantee
will continue to be effective or will be reinstated, as the case may be, if at
any time any holder of related Preferred Securities issued by a TRV Trust must
restore payment of any sums paid under such Preferred Securities or such
Guarantee.
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STATUS OF THE GUARANTEES
Each Guarantee will constitute an unsecured obligation of the Company and
will rank (i) subordinate and junior in right of payment to all other
liabilities of the Company, (ii) PARI PASSU with the most senior preferred or
preference stock now or hereafter issued by the Company and with any guarantee
now or hereafter entered into by the Company in respect of any preferred or
preference stock of any subsidiary of the Company and (iii) senior to the
Company's common stock. The terms of the Preferred Securities provide that each
holder of Preferred Securities issued by a TRV Trust by acceptance thereof
agrees to the subordination provisions and other terms of the applicable
Guarantee.
Each Guarantee will constitute a guarantee of payment and not of collection
(that is, the guaranteed party may institute a legal proceeding directly against
the guarantor to enforce its rights under a Guarantee without instituting a
legal proceeding against any other person or entity).
GOVERNING LAW
The Guarantees will be governed by, and construed in accordance with, the
internal laws of the State of New York.
DESCRIPTION OF CAPITAL STOCK
GENERAL
As of the date of this Prospectus, the Company's authorized capital stock
consists of 1,500,000,000 shares of Common Stock and 30,000,000 shares of
Preferred Stock. The descriptions below of certain provisions of the Company's
Common Stock and Preferred Stock do not purport to be complete and are subject
to and qualified in their entirety by reference to the Certificate of
Incorporation (as defined below) which is incorporated by reference as an
exhibit to the Registration Statement of which this Prospectus forms a part.
COMMON STOCK
As of April 30, 1997, the Company had outstanding approximately 641.3
million shares of its Common Stock. Each holder of Common Stock is entitled to
one vote per share for the election of directors and for all other matters to be
voted on by the Company's stockholders. Except as otherwise provided by law, the
holders of shares of Common Stock vote as one class together with the shares of
Series C Preferred Stock (as defined below). Holders of Common Stock may not
cumulate their votes in the election of directors, and are entitled to share
equally in such dividends as may be declared by the Board of Directors out of
funds legally available therefor, but only after payment of dividends required
to be paid on outstanding shares of Preferred Stock.
Upon voluntary or involuntary liquidation, dissolution or winding up of the
Company, the holders of the Common Stock share PRO RATA in the assets remaining
after payments to creditors and provision for the preference of any Preferred
Stock. There are no preemptive or other subscription rights, conversion rights
or redemption or sinking fund provisions with respect to shares of Common Stock.
All of the outstanding shares of Common Stock are fully paid and nonassessable.
The transfer agent and registrar for the Common Stock is The First National Bank
of Boston. The Common Stock is listed on the NYSE and the PCX.
PREFERRED STOCK
Under the Company's Restated Certificate of Incorporation (as amended, the
"Certificate of Incorporation"), the Board of Directors of the Company is
authorized to issue shares of the Preferred Stock in one or more series, and to
establish from time to time the number of shares to be included in each such
series and to fix the designation, powers, preferences and rights of the shares
of each such series and the qualifications, limitations or restrictions thereof,
as shall be stated and expressed in the resolution or resolutions providing for
the issue thereof adopted by the Board of Directors of the Company and as are
not stated and expressed in the Certificate of Incorporation. Prior to the
issuance of each series of Preferred Stock, the Board of Directors of the
Company will adopt resolutions creating and designating such series as a series
of Preferred Stock and such resolutions will be filed in a Certificate of
Designation (a "Certificate of Designation") as an amendment to the Certificate
of Incorporation. As used herein the term "Board of Directors of the Company"
means the Board of Directors of the Company and includes any duly authorized
committee thereof.
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The rights of holders of the Preferred Stock offered hereby will be subject
to, and may be adversely affected by, the rights of holders of any shares of
Preferred Stock that may be issued in the future. The Board of Directors may
cause shares of Preferred Stock to be issued in public or private transactions
for any proper corporate purpose, which may include issuance to obtain
additional financing in connection with acquisitions or otherwise, and issuance
to officers, directors and employees of the Company and its subsidiaries
pursuant to benefit plans or otherwise. Shares of Preferred Stock issued by the
Company may have the effect, under certain circumstances, alone or in
combination with certain other provisions of the Certificate of Incorporation
described below, of rendering more difficult or discouraging an acquisition of
the Company deemed undesirable by the Board of Directors of the Company.
As of the date of this Prospectus, the Company had outstanding 1,200,000
shares of its 8.125% Cumulative Preferred Stock, Series A (the "Series A
Preferred Stock"), 2,978,803 shares of its $4.53 ESOP Convertible Preferred
Stock, Series C (the "Series C Preferred Stock"), 7,500,000 shares of its 9.25%
Preferred Stock, Series D (the "Series D Preferred Stock") and 2,262 shares of
its Cumulative Adjustable Rate Preferred Stock, Series Y (the "Series Y
Preferred Stock"), all of which shares are fully paid and nonassessable.
SERIES A PREFERRED STOCK. The Series A Preferred Stock is not redeemable
prior to July 28, 1997, and is redeemable on such date and thereafter at the
Company's option at a redemption price equal to $250 per share (the liquidation
preference), plus accrued and unpaid dividends. The Series A Preferred Stock
ranks on a parity as to dividends and upon liquidation with the currently
outstanding series of Preferred Stock. There are no preemptive or other
subscription rights with respect to the Series A Preferred Stock. The Series A
Preferred Stock provides for cumulative quarterly dividends at the rate of
8.125% per annum, calculated as a percentage of the $250 per share stated value.
The holder of Series A Preferred Stock does not have voting rights except as
provided by law or if six quarterly dividends are in arrears and except that a
two-thirds vote of all shares of Preferred Stock voting as a class is required
for the Company to create any class of stock having a preference as to dividends
or distribution of assets over the Series A Preferred Stock. Depositary shares,
each representing one-tenth of a share of Series A Preferred Stock, are traded
on the NYSE.
SERIES C PREFERRED STOCK. Shares of Series C Preferred Stock have a stated
value of $53.25 per share (the "Stated Value"). The Series C Preferred Stock
ranks on a parity as to dividends and upon liquidation with the currently
outstanding series of Preferred Stock. There are no preemptive or other
subscription rights with respect to the Series C Preferred Stock. Shares of
Series C Preferred Stock are entitled to vote for the election of directors and
on all other matters submitted to a vote of stockholders of the Company. Each
share of Series C Preferred Stock is entitled to 2.61 votes per share, subject
to adjustment as the conversion price is adjusted, and vote jointly as a single
class with shares of Common Stock and not as a separate class except as
otherwise expressly provided for in the Delaware General Corporation Law, as
amended (the "DGCL"). However, whether or not the DGCL so provides, the
affirmative vote of the holders of at least two-thirds of the outstanding shares
of Series C Preferred Stock and all other series of Preferred Stock ranking on a
parity with the Series C Preferred Stock as to dividends and upon liquidation,
voting together as a class, is required for the Company to create a new class or
increase an existing class of stock having rights in respect of the payment of
dividends or in liquidation prior to the Series C Preferred Stock or any other
series of Preferred Stock ranking on a parity with the Series C Preferred Stock
as to dividends and upon liquidation, to issue any Preferred Stock of the
Company ranking prior to the Series C Preferred Stock either as to dividends or
upon liquidation, or to change the terms, limitations or relative rights or
preferences of the Series C Preferred Stock or any other series of Preferred
Stock ranking on a parity with the Series C Preferred Stock as to dividends and
upon liquidation, either directly or by increasing the relative rights of the
shares of another class. If the Series C Preferred Stock is entitled to vote
together with any other series of Preferred Stock, it will be entitled to one
vote per share. The holder of shares of Series C Preferred Stock is entitled to
receive dividends in the amount of $4.53 per annum per share. Generally, the
shares of Series C Preferred Stock will be redeemable, in whole or in part at
the option of the Company, on or after January 1, 1998, at a redemption price
(payable in cash or shares of Common Stock) of $53.25 per share plus accrued and
unpaid dividends thereon to the date fixed for redemption. The Series C
Preferred Stock is convertible at the option of the holder into that number of
shares of Common Stock determined by dividing the Stated Value by the conversion
price. as adjusted pursuant to the provisions of the Certificate of
Incorporation. The conversion price as of the date of this Prospectus is $32.98
per share of Series C Preferred Stock.
SERIES D PREFERRED STOCK. Shares of Series D Preferred Stock have a stated
value of $50.00 per share. The Series D Preferred Stock ranks on a parity as to
dividends, other distributions and upon liquidation with the currently
outstanding series of Preferred Stock. The Series D Preferred Stock has no
preemptive or other subscription rights.
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The holder of Series D Preferred Stock does not have voting rights except as
provided by law or if six quarterly dividends are in arrears and except that a
two-thirds vote of all shares of Preferred Stock voting as a class is required
for the Company to create any class of stock having a preference as to dividends
or distribution of assets over the Series D Preferred Stock. The holder of
shares of Series D Preferred Stock is entitled to receive dividends at the rate
of 9.25% per annum per share applied to the stated value of such share. The
shares of Series D Preferred Stock are redeemable, in whole or in part, at the
option of the Company, on or after July 1, 1997 at a redemption price of $50.00
per share plus accrued and unpaid dividends thereon to the date fixed for
redemption. Depositary shares, each representing one-half of a share of Series D
Preferred Stock, are traded on the NYSE.
SERIES Y PREFERRED STOCK. The Series Y Preferred Stock ranks on a parity as
to dividends, other distributions and upon liquidation with all of the currently
outstanding series of Preferred Stock. The holder of the Series Y Preferred
Stock is entitled to a cumulative quarterly dividend at an annual rate equal to
the greater of (i) the Short Term Rate and (ii) 4.85%. The "Short Term Rate"
generally will be equal to either 85% or 78% of the Money Market Yield (as
defined in the Certificate of Incorporation) of the 90-day rate for commercial
paper multiplied by the stock's $100,000 per share liquidation value. The Series
Y Preferred Stock is owned by a subsidiary of the Company, is redeemable without
premium at the Company's option at any time at a redemption price of $100,000
per share, plus accrued and unpaid dividends thereon to the date fixed for
redemption, and is subject to repurchase at the holder's request at its
liquidation value of $100,000 per share, plus accrued and unpaid dividends, if
not redeemed on or prior to March 31, 1999. The holder of the Series Y Preferred
Stock does not have voting rights except as required by law or if six quarterly
dividends are in arrears and except that a two-thirds vote of all shares of
Preferred Stock voting as a class is required for the Company to create any
class of stock having a preference as to dividends or distribution of assets
over the Series Y Preferred Stock.
CERTAIN PROVISIONS OF THE COMPANY'S CERTIFICATE OF INCORPORATION AND BY-LAWS
BUSINESS COMBINATIONS. The Certificate of Incorporation requires the
affirmative vote of at least 66 2/3% of the
votes entitled to be cast by the holders of the then outstanding shares of
Voting Stock (as defined therein), voting together as a single class, excluding
from such number of outstanding shares and from such required vote Voting Stock
beneficially owned by any Interested Stockholder (defined therein, generally, as
a 25% stockholder), to approve any merger or other Business Combination (as
defined therein, which term includes a merger, sale of $25,000,000 of assets,
and similar extraordinary corporate transactions) between, or otherwise
involving, the Company and any Interested Stockholder, unless the transaction
has been approved by a majority of the Continuing Directors (as defined therein)
in the manner described therein, or under some circumstances, unless certain
minimum price, form of consideration and procedural requirements are satisfied.
AMENDMENTS TO CERTIFICATE OF INCORPORATION AND BY-LAWS. Under the
Certificate of Incorporation, the alteration, amendment or repeal of, or
adoption of any provision inconsistent with the provisions of the Certificate of
Incorporation relating to the issuance of Preferred Stock or Common Stock and
amendments to the By-Laws will require the affirmative vote of the holders of at
least 75% of the voting power of the shares entitled to vote for the election of
directors. Amendments of provisions of the Certificate of Incorporation relating
to Business Combinations require a vote of the holders of 66 2/3% of the then
outstanding shares of Voting Stock, excluding Voting Stock held by Interested
Stockholders, unless 75% of the Board of Directors recommend such amendment and
the directors comprising such 75% would qualify as Continuing Directors.
VACANCIES. Vacancies on the Board of Directors resulting from an increase
in the number of directors may be filled by a majority of the Board of Directors
then in office, provided that a quorum is present, and any additional director
elected to fill such a vacancy shall hold office for a term coinciding with the
remaining term of the class to which he was elected. Any other vacancies on the
Board of Directors may be filled by a majority of the directors then in office,
even if less than a quorum, and the director so elected shall have the same
remaining term as that of his predecessor.
DESCRIPTION OF PREFERRED STOCK OFFERED HEREBY
The following summary contains a description of certain general terms of the
Company's Preferred Stock to which any Prospectus Supplement may relate. Certain
terms of any series of Preferred Stock offered by any Prospectus Supplement will
be described in the Prospectus Supplement relating thereto. If so indicated in
the
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Prospectus Supplement, the terms of any series may differ from the terms set
forth below. The description of certain provisions of the Company's Preferred
Stock does not purport to be complete and is subject to and qualified in its
entirety by reference to the provisions of the Company's Certificate of
Incorporation and the Certificate of Designation relating to each particular
series of Preferred Stock which will be filed or incorporated by reference, as
the case may be, as an exhibit to the Registration Statement of which this
Prospectus forms a part at or prior to the time of the issuance of such
Preferred Stock.
GENERAL
The Preferred Stock may be issued in one or more series, with such
designations of titles; dividend rates; any redemption provisions; special or
relative rights in the event of liquidation, dissolution, distribution or
winding up of the Company; any sinking fund provisions; any conversion or
exchange provisions; any voting rights thereof; and any other preferences,
privileges, powers, rights, qualifications, limitations and restrictions, as
shall be set forth as and when established by the Board of Directors of the
Company. The shares of any series of Preferred Stock will be, when issued, fully
paid and non-assessable and holders thereof will have no preemptive rights in
connection therewith.
The transfer agent, registrar, dividend disbursing agent and redemption
agent for shares of each series of Preferred Stock will be specified in the
Prospectus Supplement relating thereto.
RANK
Unless otherwise specified in the Prospectus Supplement relating to the
shares of any series of Preferred Stock, such shares will rank on a parity with
each other series of Preferred Stock and prior to the Common Stock as to
dividends and distributions of assets.
DIVIDENDS
Holders of each series of Preferred Stock will be entitled to receive, when,
as and if declared by the Board of Directors of the Company out of funds legally
available therefor, cash dividends at such rates and on such dates as are set
forth in the Prospectus Supplement relating to such series of Preferred Stock.
Such rates may be fixed or variable or both. Dividends will be payable to
holders of record of Preferred Stock as they appear on the books of the Company
(or, if applicable, the records of the Depositary referred to below under
"Description of Depositary Shares") on such record dates as shall be fixed by
the Board of Directors. Dividends on any series of Preferred Stock may be
cumulative or noncumulative.
No full dividends may be declared or paid on funds set apart for the payment
of dividends on any series of Preferred Stock unless dividends shall have been
paid or set apart for such payment on equity securities ranking on a parity with
respect to dividends with such series of Preferred Stock. If full dividends are
not so paid, such series of Preferred Stock shall share dividends PRO RATA with
such other equity securities.
CONVERSION AND EXCHANGE
The Prospectus Supplement for any series of Preferred Stock will state the
terms, if any, on which shares of that series are convertible into or
exchangeable for shares of Common Stock.
REDEMPTION
A series of Preferred Stock may be redeemable at any time, in whole or in
part, at the option of the Company or the holder thereof and may be subject to
mandatory redemption pursuant to a sinking fund or otherwise upon terms and at
the redemption prices set forth in the Prospectus Supplement relating to such
series.
In the event of partial redemptions of Preferred Stock, whether by mandatory
or optional redemption, the shares to be redeemed will be determined by lot or
PRO RATA, as may be determined by the Board of Directors of the Company, or by
any other method determined to be equitable by the Board of Directors.
On and after a redemption date, unless the Company defaults in the payment
of the redemption price, dividends will cease to accrue on shares of Preferred
Stock called for redemption and all rights of holders of such shares will
terminate except for the right to receive the redemption price.
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LIQUIDATION PREFERENCE
Upon any voluntary or involuntary liquidation, dissolution or winding up of
the Company, holders of each series of Preferred Stock will be entitled to
receive out of assets of the Company available for distribution to shareholders,
before any distribution is made on any securities ranking junior with respect to
liquidation, including Common Stock, distributions upon liquidation in the
amount set forth in the Prospectus Supplement relating to such series of
Preferred Stock, plus an amount equal to any accrued and unpaid dividends. If,
upon any voluntary or involuntary liquidation, dissolution or winding up of the
Company, the amounts payable with respect to the Preferred Stock of any series
and any other securities ranking on a parity with respect to liquidation rights
are not paid in full, the holders of the Preferred Stock of such series and such
other securities will share ratably in any such distribution of assets of the
Company in proportion to the full liquidation preferences to which each is
entitled. After payment of the full amount of the liquidation preference to
which they are entitled, the holders of such series of Preferred Stock will not
be entitled to any further participation in any distribution of assets of the
Company.
VOTING RIGHTS
Except as indicated in the Prospectus Supplement relating to a particular
series of Preferred Stock or except as expressly required by applicable law, the
holders of shares of Preferred Stock will have no voting rights.
DESCRIPTION OF DEPOSITARY SHARES
The description set forth below of certain material provisions of the
Deposit Agreement (as defined below) and of the Depositary Shares and Depositary
Receipts (as defined below) is subject to and qualified in its entirety by
reference to the forms of Deposit Agreement and Depositary Receipt relating to
the Preferred Stock, which will be filed or incorporated by reference, as the
case may be, as exhibits to the Registration Statement of which this Prospectus
forms a part at or prior to the issuance of Depositary Shares. The particular
terms of any Depositary Shares, any Depositary Receipts and any Deposit
Agreement relating to a particular series of Preferred Stock which vary from the
terms set forth below will be set forth in the applicable Prospectus Supplement.
GENERAL
The Company may, at its option, elect to offer fractional shares of
Preferred Stock, rather than full shares of Preferred Stock. In such event, the
Company will issue receipts for Depositary Shares, each of which will represent
a fraction (to be set forth in the Prospectus Supplement relating to a
particular series of Preferred Stock) of a share of a particular series of
Preferred Stock as described below.
The shares of any series of Preferred Stock represented by Depositary Shares
will be deposited under a Deposit Agreement (the "Deposit Agreement") between
the Company and a bank or trust company selected by the Company having its
principal office in the United States and having a combined capital and surplus
of at least $50,000,000 (the "Preferred Stock Depositary"). Subject to the terms
of the Deposit Agreement, each owner of a Depositary Share will be entitled, in
proportion to the applicable fraction of a share of Preferred Stock represented
by such Depositary Share, to all the rights and preferences of the Preferred
Stock represented thereby (including dividend, voting, redemption, conversion
and liquidation rights).
The Depositary Shares will be evidenced by depositary receipts issued
pursuant to the Deposit Agreement (the "Depositary Receipts"). Depositary
Receipts will be distributed to those persons purchasing the fractional shares
of Preferred Stock in accordance with the terms of the applicable Prospectus
Supplement.
Pending the preparation of definitive Depositary Receipts, the Preferred
Stock Depositary may, upon the written order of the Company or any holder of
deposited Preferred Stock, execute and deliver temporary Depositary Receipts
which are substantially identical to, and entitle the holders thereof to all the
rights pertaining to, the definitive Depositary Receipts. Depositary Receipts
will be prepared thereafter without unreasonable delay, and temporary Depositary
Receipts will be exchangeable for definitive Depositary Receipts.
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DIVIDENDS AND OTHER DISTRIBUTIONS
The Preferred Stock Depositary will distribute all cash dividends or other
cash distributions received in respect of the deposited Preferred Stock to the
record holders of Depositary Shares relating to such Preferred Stock in
proportion to the number of such Depositary Shares owned by such holders.
In the event of a distribution other than in cash, the Preferred Stock
Depositary will distribute property received by it to the record holders of
Depositary Shares entitled thereto. If the Preferred Stock Depositary determines
that it is not feasible to make such distribution, it may, with the approval of
the Company, sell such property and distribute the net proceeds from such sale
to such holders.
REDEMPTION OF PREFERRED STOCK
If a series of Preferred Stock represented by Depositary Shares is to be
redeemed, the Depositary Shares will be redeemed from the proceeds received by
the Preferred Stock Depositary resulting from the redemption, in whole or in
part, of such series of Preferred Stock held by the Preferred Stock Depositary.
The Depositary Shares will be redeemed by the Preferred Stock Depositary at a
price per Depositary Share equal to the applicable fraction of the redemption
price per share payable in respect of the shares of Preferred Stock so redeemed.
Whenever the Company redeems shares of Preferred Stock held by the Preferred
Stock Depositary, the Preferred Stock Depositary will redeem as of the same date
the number of Depositary Shares representing shares of Preferred Stock so
redeemed. If fewer than all the Depositary Shares are to be redeemed, the
Depositary Shares to be redeemed will be selected by the Preferred Stock
Depositary by lot or PRO RATA or by any other equitable method as may be
determined by the Preferred Stock Depositary.
WITHDRAWAL OF PREFERRED STOCK
Any holder of Depositary Shares may, upon surrender of the Depositary
Receipts at the corporate trust office of the Preferred Stock Depositary (unless
the related Depositary Shares have previously been called for redemption),
receive the number of whole shares of the related series of Preferred Stock and
any money or other property represented by such Depositary Receipts. Holders of
Depositary Shares making such withdrawals will be entitled to receive whole
shares of Preferred Stock on the basis set forth in the related Prospectus
Supplement for such series of Preferred Stock, but holders of such whole shares
of Preferred Stock will not thereafter be entitled to deposit such Preferred
Stock under the Deposit Agreement or to receive Depositary Receipts therefor. If
the Depositary Shares surrendered by the holder in connection with such
withdrawal exceed the number of Depositary Shares that represent the number of
whole shares of Preferred Stock to be withdrawn, the Preferred Stock Depositary
will deliver to such holder at the same time a new Depositary Receipt evidencing
such excess number of Depositary Shares.
VOTING DEPOSITED PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of any series of
deposited Preferred Stock are entitled to vote, the Preferred Stock Depositary
will mail the information contained in such notice of meeting to the record
holders of the Depositary Shares relating to such series of Preferred Stock.
Each record holder of such Depositary Shares on the record date (which will be
the same date as the record date for the relevant series of Preferred Stock)
will be entitled to instruct the Preferred Stock Depositary as to the exercise
of the voting rights pertaining to the amount of the Preferred Stock represented
by such holder's Depositary Shares. The Preferred Stock Depositary will
endeavor, insofar as practicable, to vote the amount of such series of Preferred
Stock represented by such Depositary Shares in accordance with such
instructions, and the Company will agree to take all reasonable actions that may
be deemed necessary by the Preferred Stock Depositary in order to enable the
Preferred Stock Depositary to do so. The Preferred Stock Depositary will vote
all shares of any series of Preferred Stock held by it proportionately with
instructions received, to the extent it does not receive specific instructions
from the holders of Depositary Shares representing such series of Preferred
Stock.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between the Company and the Preferred Stock Depositary. However, any amendment
that imposes additional charges or materially and adversely alters any
substantial existing right of the holders of Depositary Shares will not be
effective unless such amendment has been approved by the holders of at least
21
<PAGE>
a majority of the affected Depositary Shares then outstanding. Every holder of
an outstanding Depositary Receipt at the time any such amendment becomes
effective, or any transferee of such holder, shall be deemed, by continuing to
hold such Depositary Receipt, or by reason of the acquisition thereof, to
consent and agree to such amendment and to be bound by the Deposit Agreement as
amended thereby. The Deposit Agreement automatically terminates if (i) all
outstanding Depositary Shares have been redeemed; or (ii) each share of
Preferred Stock has been converted into or exchanged for Common Stock; or (iii)
there has been a final distribution in respect of the Preferred Stock in
connection with any liquidation, dissolution or winding up of the Company and
such distribution has been distributed to the holders of Depositary Shares. The
Deposit Agreement may be terminated by the Company at any time and the Preferred
Stock Depositary will provide notice of such termination to the record holders
of all outstanding Depositary Receipts not less than 30 days prior to the
termination date, in which event the Preferred Stock Depositary will deliver or
make available for delivery to holders of Depositary Shares, upon surrender of
such Depositary Shares, the number of whole or fractional shares of the related
series of Preferred Stock as are represented by such Depositary Shares.
CHARGES OF DEPOSITARY; TAXES AND OTHER GOVERNMENTAL CHARGES
The Company will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. The Company
will pay all charges of the Preferred Stock Depositary in connection with the
initial deposit of the relevant series of Preferred Stock and any redemption of
such Preferred Stock. Holders of Depositary Receipts will pay other transfer and
other taxes and governmental charges and such other charges or expenses as are
expressly provided in the Deposit Agreement to be for their accounts.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Preferred Stock Depositary may resign at any time by delivering to the
Company notice of its intent to do so, and the Company may at any time remove
the Preferred Stock Depositary, any such resignation or removal to take effect
upon the appointment of a successor Preferred Stock Depositary and its
acceptance of such appointment. Such successor Preferred Stock Depositary must
be appointed within 60 days after delivery of the notice of resignation or
removal and must be a bank or trust company having its principal office in the
United States and having a combined capital and surplus of at least $50,000,000.
MISCELLANEOUS
The Preferred Stock Depositary will forward all reports and communications
from the Company which are delivered to the Preferred Stock Depositary and which
the Company is required to furnish to the holders of the deposited Preferred
Stock.
Neither the Preferred Stock Depositary nor the Company will be liable if it
is prevented or delayed by law or any circumstances beyond its control in
performing its obligations under the Deposit Agreement. The obligations of the
Company and the Preferred Stock Depositary under the Deposit Agreement will be
limited to performance in good faith of their duties thereunder and they will
not be obligated to prosecute or defend any legal proceeding in respect of any
Depositary Shares, Depositary Receipts or shares of Preferred Stock unless
satisfactory indemnity is furnished. The Company and the Preferred Stock
Depositary may rely upon written advice of counsel or accountants, or upon
information provided by holders of Depositary Receipts or other persons believed
to be competent and on documents believed to be genuine.
PLAN OF DISTRIBUTION
The Company may sell any series of Preferred Stock or Depositary Shares and
any TRV Trust may sell Preferred Securities in one or more of the following ways
from time to time: (i) to or through underwriters or dealers, (ii) directly to
purchasers, or (iii) through agents. Any such underwriters, dealers or agents
may include Smith Barney. The Prospectus Supplement with respect to any Offered
Securities will set forth (i) the terms of the offering of the Offered
Securities, including the name or names of any underwriters, dealers or agents,
(ii) the purchase price of the Offered Securities and the proceeds to the
Company or a TRV Trust, as the case may be, from such sale, (iii) any
underwriting discounts and commissions or agency fees and other items
constituting underwriters' or agents' compensation, (iv) any initial public
offering prices, (v) any discounts or concessions allowed or reallowed or paid
to dealers and (vi) any securities exchange on which such Offered Securities may
be listed. Any initial public offering price, discounts or concessions allowed
or reallowed or paid to dealers may be changed from time to time.
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<PAGE>
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The Offered Securities may be offered to the public either through underwriting
syndicates represented by one or more managing underwriters or directly by one
or more firms acting as underwriters. The underwriter or underwriters with
respect to a particular underwritten offering of Offered Securities will be
named in the Prospectus Supplement relating to such offering and, if an
underwriting syndicate is used, the managing underwriter or underwriters will be
set forth on the cover of such Prospectus Supplement. Unless otherwise set forth
in the Prospectus Supplement relating thereto, the obligations of the
underwriters to purchase the Offered Securities will be subject to certain
conditions precedent, and the underwriters will be obligated to purchase all the
Offered Securities if any are purchased.
In connection with underwritten offerings of the Offered Securities and in
accordance with applicable law and industry practice, underwriters may
over-allot or effect transactions which stabilize, maintain or otherwise affect
the market price of the Offered Securities at levels above those which might
otherwise prevail in the open market, including by entering stabilizing bids,
effecting syndicate covering transactions or imposing penalty bids. A
stabilizing bid means the placing of any bid, or the effecting of any purchase,
for the purpose of pegging, fixing or maintaining the price of a security. A
syndicate covering transaction means the placing of any bid on behalf of the
underwriting syndicate or the effecting of any purchase to reduce a short
position created in connection with the offering. A penalty bid means an
arrangement that permits the managing underwriter to reclaim a selling
concession from a syndicate member in connection with the offering when Offered
Securities originally sold by the syndicate member are purchased in syndicate
covering transactions. Such transactions may be effected on the NYSE, in the
over-the-counter market, or otherwise. Underwriters are not required to engage
in any of these activities. Any such activities, if commenced, may be
discontinued at any time.
If dealers are utilized in the sale of Offered Securities, the Company or
the applicable TRV Trust will sell such Offered Securities to the dealers as
principals. The dealers may then resell such Offered Securities to the public at
varying prices to be determined by such dealers at the time of resale. The names
of the dealers and the terms of the transaction will be set forth in the
Prospectus Supplement relating thereto.
Offered Securities may be sold directly by the Company and/or, if
applicable, any TRV Trust to one or more institutional purchasers, or through
agents designated by the Company and/or, if applicable, any TRV Trust from time
to time, at a fixed price, or prices, which may be changed, or at varying prices
determined at time of sale. Any agent involved in the offer or sale of the
Offered Securities in respect to which this Prospectus is delivered will be
named, and any commissions payable by the Company or the applicable TRV Trust to
such agent will be set forth in the Prospectus Supplement relating thereto.
Unless otherwise indicated in the Prospectus Supplement, any such agent will be
acting on a best efforts basis for the period of its appointment.
If so indicated in the Prospectus Supplement, the Company or the applicable
TRV Trust will authorize agents, underwriters or dealers to solicit offers from
certain types of institutions to purchase Offered Securities from the Company or
such TRV Trust at the public offering price set forth in the Prospectus
Supplement pursuant to delayed delivery contracts (the "Contracts") providing
for payment and delivery on a specified date or dates in the future. Such
Contracts will not be subject to any conditions except (a) the purchase by an
institution of the Offered Securities covered by its Contracts shall not at the
time of delivery be prohibited under the laws of any jurisdiction in the United
States to which such institution is subject and (b) if the Offered Securities
are being sold to underwriters, the Company shall have sold to such underwriters
the total principal amount of the Offered Securities less the principal amount
thereof covered by the Contracts. The Prospectus Supplement will set forth the
commission payable for solicitation of such Contracts.
Smith Barney, a member of the National Association of Securities Dealers,
Inc. (the "NASD"), a subsidiary of the Company and an affiliate of the TRV
Trusts, may participate in distributions of the Offered Securities. Accordingly,
the offerings of Offered Securities will conform with the requirements set forth
in Rule 2720 of the Conduct Rules of the NASD.
This Prospectus together with an applicable Prospectus Supplement may also
be used by Smith Barney in connection with offers and sales of the Offered
Securities in market-making transactions at negotiated prices related to
prevailing market prices at the time of sale. Smith Barney may act as principal
or agent in such transactions. Smith Barney has no obligation to make a market
in any of the Offered Securities and may discontinue any market-making
activities at any time without notice, at its sole discretion.
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Agents, dealers and underwriters may be entitled, under agreements with the
Company or a TRV Trust, to indemnification by the Company or the applicable TRV
Trust against certain civil liabilities, including liabilities under the
Securities Act, or to contribution with respect to payments that such agents,
dealers or underwriters may be required to make in respect thereof. Agents,
dealers and underwriters may be customers of, engage in transactions with, or
perform services for the Company or a TRV Trust in the ordinary course of
business.
Each series of Offered Securities will be a new issue of securities and will
have no established trading market. Any underwriters to whom Offered Securities
are sold for public offering and sale may make a market in such Offered
Securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. The Offered Securities
may or may not be listed on a national securities exchange. No assurance can be
given that there will be a market for the Offered Securities.
LEGAL MATTERS
The validity of the Preferred Securities, the Junior Subordinated Debt
Securities, the Guarantees, the Preferred Stock and the Depositary Shares and
certain matters relating thereto will be passed upon for the Company and the TRV
Trusts by Skadden, Arps, Slate, Meagher & Flom LLP, New York, New York. Certain
legal matters will be passed upon for the Underwriters by Dewey Ballantine, New
York, New York. Kenneth J. Bialkin, a partner of Skadden, Arps, Slate, Meagher &
Flom LLP, is a director of the Company and he and other attorneys in such firm
beneficially own an aggregate of less than one percent of the Common Stock of
the Company.
EXPERTS
The consolidated financial statements and schedules of the Company as of
December 31, 1996 and 1995, and for each of the years in the three-year period
ended December 31, 1996, incorporated by reference or included in the Company's
Annual Report on Form 10-K for the year ended December 31, 1996, have been
incorporated by reference herein, in reliance upon the reports (also
incorporated by reference herein) of KPMG Peat Marwick LLP, independent
certified public accountants, and upon the authority of said firm as experts in
accounting and auditing. The combined financial statements as of and for the
year ended December 31, 1995 and 1994 of The Aetna Casualty and Surety Company
and The Standard Fire Insurance Company and their subsidiaries included in the
Company's Current Report on Form 8-K dated April 2, 1996, as amended, have been
incorporated by reference herein, in reliance upon the report (also incorporated
by reference herein) of KPMG Peat Marwick LLP, independent certified public
accountants, and upon the authority of said firm as experts in accounting and
auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the various expenses payable by the Company
in connection with the Securities being registered hereby. All of the fees set
forth below are estimates except for the SEC registration fee and the NASD fee.
<TABLE>
<CAPTION>
Securities and Exchange Commission Filing Fee............................. $ 303,031
<S> <C>
NASD Filing Fee........................................................... 30,500
Rating Agency Fees........................................................ 400,000
Blue Sky Fees and Expenses................................................ 5,000
Trustees' Fees and Expenses............................................... 5,000
Printing Fees and Expenses................................................ 250,000
Accounting Fees and Expenses.............................................. 75,000
Legal Fees and Expenses................................................... 100,000
Miscellaneous............................................................. 1,469
---------
Total............................................................... $1,170,000
---------
---------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Subsection (a) of Section 145 of the Delaware General Corporation Law
("DGCL") empowers a corporation to indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation) by reason of the
fact that he is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful.
Subsection (b) of Section 145 empowers a corporation to indemnify any person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, or suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that such person acted in
any of the capacities set forth above, against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, except that no indemnification may be made in respect of any claim,
issue or matter as to which such person shall have been adjudged to be liable to
the corporation unless and only to the extent that the Court of Chancery or the
court in which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the circumstances
of the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the Court of Chancery or such other court shall deem proper.
Section 145 further provides that to the extent a director or officer of a
corporation has been successful on the merits or otherwise in the defense of any
action, suit or proceeding referred to in subsections (a) and (b) of Section
145, or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith; that indemnification provided for by
Section 145 shall not be deemed exclusive of any other rights to which the
indemnified party may be entitled; that indemnification provided for by Section
145 shall, unless otherwise provided when authorized or ratified, continue as to
a person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of such person's heirs, executors and administrators; and
empowers the corporation to purchase and maintain insurance on behalf of a
director or officer of the corporation against any liability asserted against
him and incurred by him in any such capacity, or arising out of his status as
such, whether or not the corporation would have the power to indemnify him
II-1
<PAGE>
against such liabilities under Section 145. Section Three of Article V of the
Company's By-Laws provides that the Company shall indemnify its directors and
officers to the fullest extent permitted by the DGCL.
The Company also provides liability insurance for its directors and officers
which provides for coverage against loss from claims made against directors and
officers in their capacity as such, including, subject to certain exceptions,
liabilities under the federal securities laws. In certain employment agreements,
the Company or its subsidiaries have also agreed to indemnify certain officers
against loss from claims made against such officers in connection with the
performance of their duties under their employment agreements. Such
indemnification is generally to the same extent as provided in the Company's
By-laws.
Section 102(b)(7) of the DGCL provides that a certificate of incorporation
may contain a provision eliminating or limiting the personal liability of a
director to the corporation or its stockholders for monetary damages for breach
of fiduciary duty as a director provided that such provision shall not eliminate
or limit the liability of a director (i) for any breach of the director's duty
of loyalty to the corporation or its stockholders, (ii) for acts of omissions
not in good faith or which involve international misconduct or a knowing
violation of law, (iii) under Section 174 of the DGCL, or (iv) for any
transaction from which the director derived an improper personal benefit.
Article Tenth of the Company's Restated Certificate of Incorporation limits the
liability of directors to the fullest extent permitted by Section 102(b)(7).
The Declaration of each TRV Trust provides that no Institutional Trustee or
any of its affiliates, Delaware Trustee or any of its affiliates, or officer,
director, shareholder, member, partner, employee, representative custodian,
nominee or agent of the Institutional Trustee or the Delaware Trustee (each a
"Fiduciary Indemnified Person"), and no Regular Trustee, affiliate of any
Regular Trustee, or any officer, director, shareholder, member, partner,
employee, representative or agent of any Regular Trustee, or any employee or
agent of such TRV Trust or its affiliates (each a "Company Indemnified Person")
shall be liable, responsible or accountable in damages or otherwise to such TRV
Trust, any Affiliate of such TRV Trust or any holder of securities issued by
such TRV Trust, or to any officer, director, shareholder, partner, member,
representative, employee or agent of such TRV Trust or its Affiliates for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Fiduciary Indemnified Person or Company Indemnified Person in
good faith on behalf of such TRV Trust and in a manner such Fiduciary
Indemnified Person or Company Indemnified Person reasonably believed to be
within the scope of the authority conferred on such Fiduciary Indemnified Person
or Company Indemnified Person by such Declaration or by law, except that a
Fiduciary Indemnified Person or a Company Indemnified Person shall be liable for
any loss, damage or claim incurred by reason of such Fiduciary Indemnified
Person's or Company Indemnified Person's gross negligence (or in the case of a
Fiduciary Indemnified Person, negligence) or willful misconduct with respect to
such acts or omissions. The Declaration of each TRV Trust also provides that, to
the full extent permitted by law, the Company shall indemnify any Company
Indemnified Person who was or is a party or is threatened to be made a party to
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of such TRV Trust) by reason of the fact that he is or was a Company
Indemnified Person against expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted in good faith and in
a manner he reasonably believed to be in or not opposed to the best interests of
the TRV Trust, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The Declaration of each
TRV Trust also provides that to the full extent permitted by law, the Company
shall indemnify any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of such TRV Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified Person against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the TRV Trust and except that no indemnification shall be made
in respect of any claim, issue or matter as to which such Company Indemnified
Person shall have been adjudged to be liable to the TRV Trust unless and only to
the extent that the Court of Chancery of Delaware or the court in which such
action or suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses which
such Court of Chancery or such other court shall deem proper. The Declaration of
each TRV Trust further provides that expenses (including attorneys' fees)
incurred by a Company Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding referred to in the
immediately preceding two sentences shall be paid by the Company in advance of
the final disposition of such action, suit or
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<PAGE>
preceding upon receipt of an undertaking by or on behalf of such Company
Indemnified Person to repay such amount if it shall ultimately be determined
that he is not entitled to be indemnified by the Company as authorized in the
Declaration. The directors and officers of the Company and the Regular Trustees
are covered by insurance policies indemnifying them against certain liabilities,
including certain liabilities arising under the Securities Act, which might be
incurred by them in such capacities and against which they cannot be indemnified
by the Company or the TRV Trusts. Any agents, dealers or underwriters who
execute any of the agreements filed as Exhibit 1.1 to this Registration
Statement will agree to indemnify the Company's directors and their officers and
the TRV Trustees who signed the Registration Statement against certain
liabilities that may arise under the Securities Act with respect to information
furnished to the Company or any of the TRV Trusts by or on behalf of any such
indemnifying party.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENTS.
(a) Exhibits
<TABLE>
<CAPTION>
1.1 --Form of Underwriting Agreement for Trust Preferred Securities
<C> <S>
1.2 --Form of Underwriting Agreement for Preferred Stock
3.1 --Restated Certificate of Incorporation of the Company, as amended, incorporated in reference
to Exhibit 3.1 to the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1996 (File No. 1-9924) (the "1996 10-K")
3.2 --Restated By-Laws of the Company, as amended, incorporated by reference to Exhibit 3.2 to the
1996 10-K
4.1 --Certificate of Trust of Travelers Capital IV incorporated by reference to Exhibit 4.4 to the
Company's Registration Statement on Form S-3 (No. 333-12439) (the "First Registration
Statement")
4.2 --Certificate of Trust of Travelers Capital V incorporated by reference to Exhibit 4.5 to the
First Registration Statement
4.3 --Certificate of Trust of Travelers Capital VI
4.4 --Certificate of Trust of Travelers Capital VII
4.5 --Form of Amended and Restated Declaration of Trust for Travelers Capital IV incorporated by
reference to Exhibit 4.9 to the First Registration Statement
4.6 --Form of Amended and Restated Declaration of Trust for Travelers Capital V incorporated by
reference to Exhibit 4.10 to the First Registration Statement
4.7 --Form of Amended and Restated Declaration of Trust for Travelers Capital VI
4.8 --Form of Amended and Restated Declaration of Trust for Travelers Capital VII
4.9 --Form of Indenture between Travelers Group Inc. and The Chase Manhattan Bank, as Trustee,
incorporated by reference to Exhibit 4.11 to the First Registration Statement
4.10 --Form of Preferred Security (included in Exhibit 4.5)
4.11 --Form of Common Security (included in Exhibit 4.5)
4.12 --Form of Guarantee with respect to the Preferred Securities of Travelers Capital IV
incorporated by reference to Exhibit 4.17 to the First Registration Statement
4.13 --Form of Guarantee with respect to the Preferred Securities of Travelers Capital V
incorporated by reference to Exhibit 4.18 to the First Registration Statement
4.14 --Form of Guarantee with respect to the Preferred Securities of Travelers Capital VI
4.15 --Form of Guarantee with respect to the Preferred Securities of Travelers Capital VII
4.16 --Form of Junior Subordinated Debt Securities (included in Exhibit 4.9)
4.17 --Form of Certificate for Preferred Stock will be filed as an exhibit to a Current Report on
Form 8-K of the Company and incorporated herein by reference
4.18 --Form of Deposit Agreement
4.19 --Form of Depositary Receipt (included in Exhibit 4.18)
5.1 --Opinion of Skadden, Arps, Slate, Meagher & Flom LLP
12.1 --Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends of
Travelers Group Inc.
23.1 --Consent of KPMG Peat Marwick LLP, Independent Certified Public Accountants
23.2 --Consent of KPMG Peat Marwick LLP, Independent Certified Public Accountants
23.3 --Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5.1)
24.1 --Powers of Attorney of certain directors
</TABLE>
II-3
<PAGE>
<TABLE>
<C> <S>
25.1 --Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Trustee under the Indenture incorporated by reference to Exhibit 25.1 to
the First Registration Statement
25.2 --Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Trustee under the Declaration of Trust of Travelers Capital IV
incorporated by reference to Exhibit 25.5 to the First Registration Statement
25.3 --Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Trustee under the Declaration of Trust of Travelers Capital V incorporated
by reference to Exhibit 25.6 to the First Registration Statement
25.4 --Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Trustee under the Declaration of Trust of Travelers Capital VI
25.5 --Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Trustee under the Declaration of Trust of Travelers Capital VII
25.6 --Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Guarantee Trustee under the Preferred Securities Guarantee of Travelers
Group Inc. for the benefit of holders of Preferred Securities of Travelers Capital IV
incorporated by reference to Exhibit 25.10 to the First Registration Statement
25.7 --Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Guarantee Trustee under the Preferred Securities Guarantee of Travelers
Group Inc. for the benefit of holders of Preferred Securities of Travelers Capital V
incorporated by reference to Exhibit 25.11 to the First Registration Statement
25.8 --Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Guarantee Trustee under the Preferred Securities Guarantee of Travelers
Group Inc. for the benefit of holders of Preferred Securities of Travelers Capital VI
25.9 --Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Guarantee Trustee under the Preferred Securities Guarantee of Travelers
Group Inc. for the benefit of holders of Preferred Securities of Travelers Capital VII
</TABLE>
ITEM 17. UNDERTAKING.
The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement;
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) that, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement;
(iii) to include any material information with respect to the Plan of
Distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that the undertakings set forth in paragraphs (i) and
(ii) above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by Travelers Group Inc. pursuant to Section 13 or Section
15(d) of the Exchange Act of 1934, as amended (the "Exchange Act") that
are incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new Registration Statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act, each filing of Travelers
Group Inc.'s Annual Report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new
II-4
<PAGE>
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrants pursuant to the provisions referred to in Item 15 (other than the
insurance policies referred to therein), or otherwise, the Registrants have been
advised that, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrants of expenses
incurred or paid by a director, officer or controlling person of the Registrants
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrants will, unless in the opinion of their counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
The undersigned Registrants hereby undertake that:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of a
registration statement in reliance upon Rule 430A and contained in the form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of the
registration statement as of the time it was declared effective.
(2) For the purposes of determining any liability under the Securities
Act each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Travelers Group
Inc. hereby certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of New York, State of New York, on the 14th day of
May, 1997.
TRAVELERS GROUP INC.
By /s/ JAMES DIMON
------------------------------------------
Name: James Dimon
Title: President
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on the 14th day of May, 1997.
SIGNATURE TITLE
- ------------------------------ --------------------------
Chairman of the Board and
/s/ SANFORD I. WEILL Chief Executive Officer
- ------------------------------ (Principal Executive
Sanford I. Weill Officer) and Director
Senior Vice President and
/s/ HEIDI G. MILLER Chief Financial Officer
- ------------------------------ (Principal Financial
Heidi G. Miller Officer)
Executive Vice President
/s/ IRWIN ETTINGER and Chief Accounting
- ------------------------------ Officer (Principal
Irwin Ettinger Accounting Officer)
*
- ------------------------------ Director
C. Michael Armstrong
- ------------------------------ Director
Judith Arron
*
- ------------------------------ Director
Kenneth J. Bialkin
- ------------------------------ Director
Edward H. Budd
*
- ------------------------------ Director
Joseph A. Califano, Jr.
- ------------------------------ Director
Douglas D. Danforth
- ------------------------------ Director
Robert F. Daniell
/s/ JAMES DIMON
- ------------------------------ Director
James Dimon
- ------------------------------ Director
Leslie B. Disharoon
- ------------------------------ Director
Gerald R. Ford
II-6
<PAGE>
SIGNATURE TITLE
- ------------------------------ --------------------------
*
- ------------------------------ Director
Thomas Jones
- ------------------------------ Director
Ann D. Jordan
*
- ------------------------------ Director
Robert I. Lipp
- ------------------------------ Director
Michael Masin
*
- ------------------------------ Director
Dudley C. Mecum
- ------------------------------ Director
Andrall E. Pearson
- ------------------------------ Director
Frank J. Tasco
*
- ------------------------------ Director
Linda J. Wachner
*
- ------------------------------ Director
Joseph R. Wright, Jr.
*
- ------------------------------ Director
Arthur Zankel
*By: /s/ JAMES DIMON
-------------------------
James Dimon
ATTORNEY-IN-FACT
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Travelers
Capital IV, Travelers Capital V, Travelers Capital VI and Travelers Capital VII
each hereby certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of New York, State of New York, on the 14th day of
May, 1997.
TRAVELERS CAPITAL IV
By: /s/ HEIDI G. MILLER
-----------------------------------
Heidi G. Miller, as Trustee
By: /s/ IRWIN ETTINGER
-----------------------------------
Irwin Ettinger, as Trustee
TRAVELERS CAPITAL V
By: /s/ HEIDI G. MILLER
-----------------------------------
Heidi G. Miller, as Trustee
By: /s/ IRWIN ETTINGER
-----------------------------------
Irwin Ettinger, as Trustee
TRAVELERS CAPITAL VI
By: /s/ HEIDI G. MILLER
-----------------------------------
Heidi G. Miller, as Trustee
By: /s/ IRWIN ETTINGER
-----------------------------------
Irwin Ettinger, as Trustee
TRAVELERS CAPITAL VII
By: /s/ HEIDI G. MILLER
-----------------------------------
Heidi G. Miller, as Trustee
By: /s/ IRWIN ETTINGER
-----------------------------------
Irwin Ettinger, as Trustee
II-8
<PAGE>
_______ TRUST PREFERRED SECURITIES
TRAVELERS CAPITAL ___
___% Trust Preferred Securities
(Liquidation amount $______ per Trust Preferred Security)
guaranteed to the extent set forth in the Prospectus
Supplement dated __________, 199 by
TRAVELERS GROUP INC.
UNDERWRITING AGREEMENT
_________, 199_
SMITH BARNEY INC.
[Co-Managers]
As Representative of the Several Underwriters
c/o SMITH BARNEY INC.
388 Greenwich Street
New York, New York 10013
Ladies and Gentlemen:
Travelers Capital ________ (the "Trust"), a statutory business trust
organized under the Business Trust Act (the "Delaware Act") of the State of
Delaware (Chapter 38, Title 12, of the Delaware Business Code, 12 Del. C.
Section 3801 et seq.), proposes, upon the terms and conditions set forth herein,
to issue and sell ___% Trust Preferred Securities with an aggregate liquidation
amount equal to $__________ (the "Firm Preferred Securities") to the several
Underwriters named in Schedule I hereto (the "Underwriters"). The Trust also
proposes, upon the terms and conditions set forth herein and solely for the
purpose of covering over-allotments, to issue and sell to the Underwriters up to
an additional __________ ___% Trust Preferred Securities with an aggregate
liquidation amount equal to $___________ (the "Additional Preferred
Securities"). The Firm Preferred Securities and the Additional Preferred
Securities are hereinafter collectively referred to as the "Preferred
Securities."
The Preferred Securities and the Common Securities (as defined
herein) are to be issued pursuant to the terms of a declaration of trust, dated
as of ___________, 1997, as amended and restated as of ___________, 199_ (the
"Declaration"), among Travelers Group Inc., a Delaware corporation (the
"Company" and, together with the Trust, the "Offerors"), as sponsor, the
trustees named therein (the "TRV Trustees") and the holders from time to time of
undivided beneficial interests in the assets of the Trust. The Declaration is
qualified as an indenture under the Trust Indenture Act of 1939, as amended (the
"1939 Act"). Pursuant to the Declaration, the number of TRV Trustees will
initially be four. Two of the TRV Trustees (the "Regular Trustees") will be
persons who are employees or officers of, or affiliated with, the Company. The
third TRV Trustee will be a financial institution unaffiliated with the Company
that will serve as property trustee under the Declaration and as indenture
trustee with respect to the Preferred Securities for purposes of the 1939 Act
(the "Institutional Trustee"). The fourth TRV Trustee will be a financial
institution or an affiliate thereof which maintains a principal place of
business in the State of Delaware, meeting the requirements of the Delaware Act
(the "Delaware Trustee"). Initially, The Chase Manhattan Bank, a New York
banking association ("Chase"), will act as the Institutional Trustee and Chase
Manhattan Bank Delaware, a banking association with its principal place of
business in the State of Delaware, will act
<PAGE>
as the Delaware Trustee until removed or replaced by the holder of the Common
Securities. The Preferred Securities will be guaranteed by the Company on a
subordinated basis with respect to distributions and payments upon liquidation,
redemption or otherwise (the "Guarantee") pursuant to the Preferred Securities
Guarantee Agreement dated as of ___________, 199_ (the "Guarantee Agreement")
between the Company and Chase, as Trustee (the "Guarantee Trustee"). The assets
of the Trust will consist of ____% Junior Subordinated Deferrable Interest
Debentures due ___________ (the "Subordinated Debentures") of the Company which
will be issued under an indenture, dated as of ___________, 199_ (the
"Indenture"), between the Company and Chase, as Trustee (the "Indenture
Trustee"). Under certain circumstances, the Subordinated Debentures will be
distributable to the holders of undivided beneficial interests in the assets of
the Trust. The Preferred Securities, the Guarantee and the Subordinated
Debentures are referred to herein as the "Securities."
The Offerors wish to confirm as follows their agreement with you and
the other several Underwriters on whose behalf you are acting, in connection
with the several purchases of the Preferred Securities by the Underwriters.
1. Registration Statement and Prospectus. The Offerors have prepared
and filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"Securities Act"), a registration statement on Form S-3 (File No. 333-______)
under the Securities Act (the "registration statement"), including a prospectus
subject to completion relating to the Securities. The term "Registration
Statement" as used in this Agreement means the registration statement (including
all financial schedules and exhibits), as amended at the time it becomes
effective, or, if the registration statement became effective prior to the
execution of this Agreement, as supplemented or amended prior to the execution
of this Agreement. If it is contemplated, at the time this Agreement is
executed, that a post-effective amendment to the registration statement will be
filed and must be declared effective before the offering of the Preferred
Securities may commence, the term "Registration Statement" as used in this
Agreement means the registration statement as amended by said post-effective
amendment. If an additional registration statement is prepared and filed with
the Commission in accordance with Rule 462(b) under the Securities Act (an
"Additional Registration Statement"), the term "Registration Statement" as used
in this Agreement includes the Additional Registration Statement. The term "Base
Prospectus" as used in this Agreement means the prospectus in the form included
in the Registration Statement. The term "Prospectus" as used in this Agreement
means the Base Prospectus together with the prospectus supplement or supplements
relating to the Preferred Securities filed with the Commission pursuant to Rule
424(b) under the Securities Act. The term "Prepricing Prospectus" as used in
this Agreement means the prospectus supplement subject to completion relating to
the Preferred Securities together with the Base Prospectus as such prospectus
shall have been amended from time to time prior to the date of such prospectus
supplement and filed with the Commission pursuant to Rule 424(b) under the
Securities Act. Any reference in this Agreement to the registration statement,
the Registration Statement, any Prepricing Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Form S-3 under the Securities Act, as of the date of the
registration statement, the Registration Statement, such Prepricing Prospectus
or the Prospectus, as the case may be, and any reference to any amendment or
supplement to the registration statement, the Registration Statement, any
Prepricing Prospectus or the Prospectus shall be deemed to refer to and include
any documents filed after such date under the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") which, upon filing, are incorporated by
reference therein, as required by Form S-3. As used herein, the term
"Incorporated Documents" means the documents which at the time are incorporated
by reference in the registration statement, the Registration Statement, any
Prepricing Prospectus, the Prospectus, or any amendment or supplement thereto.
2. Agreements to Sell and Purchase. The Trust hereby agrees, subject
to all the terms and conditions set forth herein, to issue and sell to each
Underwriter and, upon the basis of the representations, warranties and
agreements of the Offerors herein contained and subject to all the terms and
2
<PAGE>
conditions set forth herein each Underwriter agrees, severally and not jointly,
to purchase from the Trust, at a purchase price of $___________ per Firm
Preferred Security, plus accrued distributions, if any, from ___________, 199_,
the number of Firm Preferred Securities set forth opposite the name of such
Underwriter in Schedule I hereto (or such number of Firm Preferred Securities
increased as set forth in Section 10 hereof).
The Company agrees that, in view of the fact that the proceeds of
the sale of the Preferred Securities will be invested in the Subordinated
Debentures, it shall pay to the Underwriters as compensation ("Underwriters'
Compensation") for their arranging the investment of the proceeds therein, on
the Closing Date, $___________ per Firm Preferred Security.
The Trust also agrees, subject to all the terms and conditions set
forth herein, to sell to the Underwriters, and upon the basis of the
representations, warranties and agreements of the Company herein contained and
subject to all the terms and conditions set forth herein, the Underwriters shall
have the right to purchase from the Company pursuant to an option (the
"over-allotment option") which may be exercised at any one time prior to 9:00
P.M., New York City time, on the 30th day after the date of the Prospectus (or,
if such 30th day shall be a Saturday or Sunday or a holiday, on the next
business day thereafter when the New York Stock Exchange is open for trading),
up to ___________ Additional Preferred Securities at the same purchase price as
the Firm Preferred Securities, plus accrued distributions, if any, from
___________, 199_. Upon exercise of the over-allotment option, each Underwriter,
severally and not jointly, agrees to purchase that number of Additional
Preferred Securities (subject to such adjustments as you may determine in order
to avoid fractional shares) which bears the same proportion to the aggregate
number of Additional Preferred Securities to be purchased by the Underwriters as
the number of Firm Preferred Securities set forth opposite the name of such
Underwriter bears in Schedule I hereto (or such number of Firm Preferred
Securities increased as set forth in Section 10 hereof) to the aggregate number
of Firm Preferred Securities. The Company agrees that it will pay Underwriters'
Compensation on the Option Closing Date in the amounts per Preferred Security
set forth in the immediately preceding paragraph with respect to any Additional
Preferred Securities purchased by the Underwriters.
3. Terms of Public Offering. The Offerors have been advised by you
that the Underwriters propose to make a public offering of their respective
portions of the Preferred Securities as soon as the Underwriters deem advisable
after the Registration Statement has become effective, this Agreement has been
executed and delivered, and the Declaration, the Guarantee Agreement and the
Indenture have been qualified under the 1939 Act. The entire proceeds from the
sale of the Preferred Securities will be combined with the entire proceeds from
the sale by the Trust to the Company of its common securities (the "Common
Securities"), and will be used by the Trust to purchase an equivalent amount of
the Subordinated Debentures.
4. Delivery of the Preferred Securities and Payment Therefor.
Delivery to the Underwriters of and payment for the Firm Preferred Securities
shall be made at the office of Smith Barney Inc., 388 Greenwich Street, New
York, New York 10013, at 8:30 A.M., New York City time, on ___________, 199_
(the "Closing Date"). The place of closing for the Preferred Securities and the
Closing Date may be varied by agreement between you and the Company.
Delivery to the Underwriters of and payment for any Additional
Preferred Securities to be purchased by the Underwriters shall be made at the
aforementioned office of Smith Barney Inc. at such time on such date (the
"Option Closing Date"), which may be the same as the Closing Date but shall in
no event be earlier than the Closing Date nor earlier than two nor later than
ten business days after the giving of the notice hereinafter referred to, as
shall be specified in a written notice from you to the Offerors of the
Underwriters' determination to purchase the number of Additional Preferred
Securities specified in such notice. The place of closing for any Additional
Preferred Securities and the Option Closing Date for such Additional Preferred
Securities may be varied by agreement between you and the Offerors.
3
<PAGE>
The Firm Preferred Securities and any Additional Preferred
Securities which the Underwriters may elect to purchase shall be delivered to
you for the accounts of the several Underwriters registered in the name of CEDE
& CO., as nominee for the Depository Trust Company, against payment of the
purchase price therefor in immediately available funds. The Preferred Securities
to be delivered to the Underwriters shall be made available to you in New York
City for inspection and packaging not later than 9:30 A.M., New York City time,
on the business day next preceding the Closing Date or the Option Closing Date,
as the case may be.
5. Agreements of the Offerors. The Offerors jointly and severally
agree with the several Underwriters as follows:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
(or any Additional Registration Statement) to be declared or to become effective
before the offering of the Securities may commence, the Offerors will endeavor
to cause the Registration Statement or such post-effective amendment to become
effective as soon as possible and will advise you promptly and, if requested by
you, will confirm such advice in writing, when the Registration Statement or
such post-effective amendment (or any Additional Registration Statement) has
become effective.
(b) The Offerors will advise you promptly and, if requested by you,
will confirm such advice in writing: (i) of any request by the Commission for
amendment of or a supplement to the Registration Statement, any Prepricing
Prospectus or the Prospectus or for additional information; (ii) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Securities
for offering or sale in any jurisdiction or the initiation of any proceeding for
such purpose; and (iii) within the period of time referred to in paragraph (f)
below, of the happening of any event which makes any statement of a material
fact made in the Registration Statement or the Prospectus (as then amended or
supplemented) untrue or which requires the making of any additions to or changes
in the Registration Statement or the Prospectus (as then amended or
supplemented) in order to state a material fact required by the Securities Act
or the regulations thereunder to be stated therein or necessary in order to make
the statements therein not misleading, or of the necessity to amend or
supplement the Prospectus (as then amended or supplemented) to comply with the
Securities Act or any other law. If at any time the Commission shall issue any
stop order suspending the effectiveness of the Registration Statement, the
Offerors will make every reasonable effort to obtain the withdrawal of such
order at the earliest possible time.
(c) The Offerors will furnish to you, without charge, (i)
___________ copies (which may be photocopies) of the registration statement as
originally filed with the Commission via EDGAR and of each amendment thereto so
filed, including financial statements and all exhibits to the registration
statement, and will furnish you with an equal number of copies of executed
signature pages regarding the same, (ii) such number of conformed copies of the
registration statement as originally filed and of each amendment thereto, but
without exhibits, as you may reasonably request and (iii) such number of copies
of the Declaration, the Guarantee and the Indenture and of the Incorporated
Documents, as you may reasonably request.
(d) Prior to the end of the period of time referred to in the first
sentence in subsection (f) below, the Offerors will not file any amendment to
the Registration Statement or any Additional Registration Statement or make any
amendment or supplement to the Prospectus to which you shall reasonably object
or file any Form 8-K which upon filing becomes an Incorporated Document and of
which you shall not previously have been advised (other than Form 8-Ks filed in
connection with debt offerings by the Company).
(e) Prior to the execution and delivery of this Agreement, the
Offerors have delivered to you, without charge, in such quantities as you have
reasonably requested, copies of each Prepricing
4
<PAGE>
Prospectus. The Offerors consent to the use, in accordance with the provisions
of the Securities Act and with the securities or Blue Sky laws of the
jurisdictions in which the Preferred Securities are offered by the several
Underwriters and by dealers, prior to the date of the Prospectus, of each
Prepricing Prospectus so furnished by the Offerors.
(f) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as in the opinion of
counsel for the Underwriters a Prospectus is required by the Securities Act to
be delivered in connection with sales by any Underwriter or dealer, the Offerors
will expeditiously deliver to each Underwriter and each dealer, without charge,
as many copies of the Prospectus (and of any amendment or supplement thereto) as
you may reasonably request. The Offerors' consent to the use of the Prospectus
(and of any amendment or supplement thereto) in accordance with the provisions
of the Securities Act and with the securities or Blue Sky laws of the
jurisdictions in which the Preferred Securities are offered by the several
Underwriters and by all dealers to whom Preferred Securities may be sold, both
in connection with the offering and sale of the Preferred Securities and for
such period of time thereafter as the Prospectus is required by the Securities
Act to be delivered in connection with sales by any Underwriter or dealer. If
during such period of time any event shall occur that in the judgment of the
Offerors or in the opinion of counsel for the Underwriters is required to be set
forth in the Prospectus (as then amended or supplemented) or should be set forth
therein in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is necessary
to supplement or amend the Prospectus (or to file under the Exchange Act any
document which, upon filing, becomes an Incorporated Document) in order to
comply with the Securities Act or any other law, the Offerors will forthwith
prepare and, subject to the provisions of paragraph (d) above, file with the
Commission an appropriate supplement or amendment thereto (or to such document),
and will expeditiously furnish to the Underwriters and dealers a reasonable
number of copies thereof.
(g) The Offerors will cooperate with you and with counsel for the
Underwriters in connection with the registration or qualification of the
Securities for offering and sale by the several Underwriters and by dealers
under the securities or Blue Sky laws of such jurisdictions as you may designate
and will file such consents to service of process or other documents necessary
or appropriate in order to effect such registration or qualification; provided
that in no event shall the Company or the Trust be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any
action which would subject it to service of process in suits, other than those
arising out of the offering or sale of the Preferred Securities, in any
jurisdiction where it is not now so subject.
(h) The Offerors will make generally available to the Trust's
security holders a consolidated earnings statement, which need not be audited,
covering a twelve-month period commencing after the effective date of the
Registration Statement and ending not later than 15 months thereafter, as soon
as practicable after the end of such period, which consolidated earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act.
(i) During the period of three years hereafter (i) the Company will
furnish to you, upon your request (x) as soon as available, a copy of each
report of the Company mailed to stockholders and a copy of each Annual Report on
Form 10-K, each quarterly report on Form 10-Q and each current report on Form
8-K filed by the Company with the Commission under the Exchange Act and (y) from
time to time such other information concerning the Company as you may reasonably
request, and (ii) the Trust will furnish to you, upon your request, a copy of
each report of the Trust mailed to holders of Preferred Securities or Common
Securities.
(j) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provisions hereof (otherwise than pursuant to the
second paragraph of Section 10 hereof or by notice given by you terminating this
Agreement pursuant to Section 10 or Section 11 hereof) or if this Agreement
shall be terminated by the Underwriters because of any failure or refusal on the
part of the Offerors to comply with the terms or fulfill any of the conditions
of this Agreement, the Company agrees to reimburse
5
<PAGE>
the Representatives for all reasonable out-of-pocket expenses (including
reasonable fees and expenses of counsel for the Underwriters) incurred by you in
connection herewith.
(k) The Trust will apply the net proceeds from the sale of the
Preferred Securities, and the Company will apply the net proceeds from the sale
of the Subordinated Debentures, substantially in accordance with the description
set forth in the Prospectus.
(l) The Offerors will timely file the Prospectus pursuant to Rule
424(b) under the Securities Act.
(m) Each of the Trust and the Company agree, during the period
beginning on the date of this Agreement and continuing to and including the date
that is 60 days after the Closing Date, not to offer, sell, contract to offer,
sell or otherwise dispose of any preferred securities or any other securities
(including any backup undertakings for such securities) of the Company or of the
Trust, in each case that are substantially similar to the Preferred Securities,
or any securities convertible into or exchangeable for the Preferred Securities
or such substantially similar securities of either the Trust or the Company,
except Preferred Securities offered pursuant to the Base Prospectus, without the
prior written consent of Smith Barney Inc.
(n) Except as stated in this Agreement and in the Prepricing
Prospectus and Prospectus, the Company has not taken, nor will it take, directly
or indirectly, any action designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the price of the Preferred
Securities to facilitate the sale or resale of the Preferred Securities.
6. Representations and Warranties of the Offerors. The Offerors
jointly and severally represent and warrant to, and agree with, each Underwriter
that:
(a) The Prepricing Prospectus dated ___________, 19__ complied in
all material respects with the provisions of the Securities Act. The Commission
has not issued any order preventing or suspending the use of any Prepricing
Prospectus.
(b) The registration statement in the form in which it became or
becomes effective and also in such form as it may be when any post-effective
amendment thereto shall become effective, any Additional Registration Statement
when filed with the Commission pursuant to Rule 462(b) under the Securities Act
and the Prospectus and any supplement or amendment thereto when filed with the
Commission under Rule 424(b) under the Securities Act complied or will comply in
all material respects with the provisions of the Securities Act and will not at
any such times contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except that this representation and warranty does not
apply to statements in or omissions from the registration statement or the
Prospectus made in reliance upon and in conformity with (i) information relating
to any Underwriter furnished to the Offerors in writing by or on behalf of any
Underwriter through you expressly for use therein, or (ii) the Statement of
Eligibility and Qualification (Form T-1) under the 1939 Act of each of the
Institutional Trustee, the Guarantee Trustee and the Indenture Trustee.
(c) The Incorporated Documents heretofore filed, when they were
filed (or, if any amendment with respect to any such document was filed, when
such amendment was filed), conformed in all material respects with the
requirements of the Exchange Act and the rules and regulations thereunder, any
further Incorporated Documents so filed will, when they are filed, conform in
all material respects with the requirements of the Exchange Act and the rules
and regulations thereunder; no such document when it was filed (or, if an
amendment with respect to any such document was filed, when such amendment was
filed), contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading; and no such further
6
<PAGE>
document, when it is filed, will contain an untrue statement of a material fact
or will omit to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading.
(d) The execution and delivery of, and the performance by the
Company and the Trust of their respective obligations under this Agreement have
been duly and validly authorized by the Company and the Trust, respectively, and
this Agreement has been duly executed and delivered by the Company and the
Trust.
(e) The Preferred Securities have been duly and validly authorized
by the Declaration and, when executed by the Trust and authenticated by the
Institutional Trustee in accordance with the Declaration and delivered to you
against payment therefor in accordance with the terms hereof, will be validly
issued and (subject to the terms of the Declaration) will be fully paid and
non-assessable undivided beneficial interests in the assets of the Trust, will
be entitled to the benefits of the Declaration and will conform to all
statements relating thereto contained in the Registration Statement and the
Prospectus, and any amendment or supplement thereto; the issuance of the
Preferred Securities is not subject to preemptive or other similar rights;
holders of Preferred Securities will be entitled to the same limitation of
personal liability extended to stockholders of private corporations for profit
under the General Corporation Law of the State of Delaware; and the Preferred
Securities have been registered under the Exchange Act and authorization for
listing the Preferred Securities on the New York Stock Exchange has been given,
subject to notice of official issuance.
(f) The Declaration has been duly and validly authorized by the
Company and, at the Closing Date, will have been duly executed and delivered by
the Company and the Regular Trustees, and assuming due execution and delivery by
the Institutional Trustee and the Delaware Trustee, the Declaration will be a
valid and legally binding obligation of the Company and the Regular Trustees,
enforceable in accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency or other similar laws affecting creditors'
rights generally and general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity); and the
Declaration has been (or will have been) duly qualified under the 1939 Act and
conforms to the description thereof in the Registration Statement and the
Prospectus, and any amendment or supplement thereto.
(g) The Guarantee has been duly and validly authorized by the
Company and, at the Closing Date, will have been duly executed and delivered by
the Company, and assuming due execution and delivery by the Guarantee Trustee,
the Guarantee will be a valid and legally binding obligation of the Company,
enforceable in accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency or other similar laws affecting creditors'
rights generally and general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity); and the
Guarantee has been (or will have been) duly qualified under the 1939 Act and
conforms to the description thereof in the Registration Statement and the
Prospectus, and any amendment or supplement thereto.
(h) The Indenture has been duly and validly authorized by the
Company and, at the Closing Date, will have been duly executed and delivered by
the Company, and assuming due execution and delivery by the Indenture Trustee,
the Indenture will be a valid and binding obligation of the Company, enforceable
in accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency or other similar laws affecting creditors' rights
generally and general principles of equity (regardless of whether enforceability
is considered in a proceeding at law or in equity); and the Indenture has been
(or will have been) duly qualified under the 1939 Act and conforms to the
description thereof in the Registration Statement and the Prospectus, and any
amendment or supplement thereto.
(i) The Subordinated Debentures have been duly and validly
authorized by the Company and, when authenticated by the Indenture Trustee in
the manner provided for in the Indenture and issued in accordance with the
Indenture and delivered to the Trust against payment therefor as described in
the Registration Statement and the Prospectus, and any amendment or supplement
thereto, will be valid
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<PAGE>
and legally binding obligations of the Company, enforceable in accordance with
their terms, except as enforcement thereof may be limited by bankruptcy,
insolvency or other similar laws affecting creditors' rights generally, and
general principles of equity (regardless of whether enforceability is considered
in a proceeding at law or in equity), and will be in the form contemplated by,
and entitled to the benefits of, the Indenture and conform to the description
thereof in the Registration Statement and the Prospectus, and any amendment or
supplement thereto.
(j) The Trust has been duly created and is validly existing and in
good standing as a business trust under the Delaware Act with the power and
authority to own property and to conduct its business as described in the
Registration Statement and Prospectus, and any amendment or supplement thereto,
and to enter into and perform its obligations under this Agreement, the
Preferred Securities and the Declaration and is not required to be authorized to
do business in any other jurisdiction; the Trust is not a party to or otherwise
bound by any agreement other than those described in the Prospectus, and any
amendment or supplement thereto; the Trust will be classified as a grantor trust
and not as an association taxable as a corporation for U.S. federal income tax
purposes; and the Trust is and will be treated as a consolidated subsidiary of
the Company pursuant to generally accepted accounting principles.
(k) The Regular Trustees of the Trust are officers of the Company
and have been duly authorized by the Company to execute and deliver the
Declaration.
(l) The Company is a corporation duly organized and validly existing
in good standing under the laws of the State of Delaware with full corporate
power and authority to enter into and perform its obligations under this
Agreement, the Declaration, the Indenture, the Guarantee and the Subordinated
Debentures, and to purchase, own and hold the Common Securities issued by the
Trust.
(m) The consolidated historical and pro forma financial statements,
together with related schedules and notes, included or incorporated by reference
in the Registration Statement and the Prospectus (and any amendment or
supplement thereto), comply as to form in all material respects with the
requirements of the Securities Act. Such historical financial statements present
fairly the consolidated financial position of the Company and its subsidiaries
at the respective dates indicated and the results of their operations and their
cash flows for the respective periods indicated in accordance with generally
accepted accounting principles consistently applied throughout such periods. The
pro forma financial statements have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial statements
and have been properly compiled on the basis described therein, and the
assumptions used in the preparation thereof are, in the Company's opinion,
reasonable.
(n) The Offerors have not distributed and, prior to the later to
occur of (i) the Closing Date and (ii) completion of the distribution of the
Preferred Securities, will not distribute any offering materials in connection
with the offering and sale of the Preferred Securities other than the
Registration Statement, the Prepricing Prospectus, the Prospectus or other
materials, if any, permitted by the Securities Act.
(o) No holder of any security of the Company or the Trust has any
right to require registration of the Preferred Securities or of any other
security of the Company or the Trust because of the filing of the registration
statement or the consummation of the transactions contemplated by this
Agreement.
(p) Neither the Trust nor the Company is now, nor after giving
effect to the transactions contemplated hereby will be, and neither the Trust
nor the Company is controlled by, or acting on behalf of any person which is, an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
7. Indemnification and Contribution. (a) Each of the Trust and the
Company jointly and severally agrees to indemnify and hold harmless each of you
and each other Underwriter and each
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<PAGE>
person, if any, who controls any Underwriter within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act from and against any and
all losses, claims, damages, liabilities and expenses (including reasonable
costs of investigation) arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Prepricing
Prospectus or in the Registration Statement or the Prospectus or in any
amendment or supplement thereto, or arising out of or based upon any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except insofar as
such losses, claims, damages, liabilities or expenses arise out of or are based
upon any untrue statement or omission or alleged untrue statement or omission
which has been made therein or omitted therefrom in reliance upon and in
conformity with the information relating to such Underwriter furnished in
writing to the Offerors by or on behalf of any Underwriter through you expressly
for use in connection therewith; provided, however, that the indemnification
contained in this paragraph (a) with respect to any Prepricing Prospectus shall
not inure to the benefit of any Underwriter (or to the benefit of any person
controlling such Underwriter) to the extent that any such loss, claim, damage,
liability or expense arises from the sale of the Preferred Securities by such
Underwriter to any person if it shall be established that a copy of the
Prospectus shall not have been delivered or sent to such person within the time
required by the Securities Act and the regulations thereunder, and the untrue
statement or alleged untrue statement or omission or alleged omission of a
material fact contained in such Prepricing Prospectus was corrected in the
Prospectus and such correction would have cured the defect giving rise to such
loss, claim, damage, liability or expense, provided that the Offerors have
delivered the Prospectus to the several Underwriters in requisite quantity on a
timely basis to permit such delivery or sending. The foregoing indemnity
agreement shall be in addition to any liability which the Trust or the Company
may otherwise have.
(b) If any action, suit or proceeding shall be brought against any
Underwriter or any person controlling any Underwriter in respect of which
indemnity may be sought against the Trust or the Company, such Underwriter or
such controlling person shall promptly notify the Trust and the Company, and the
Trust or the Company shall assume the defense thereof, including the employment
of counsel and payment of all fees and expenses. Such Underwriter or any such
controlling person shall have the right to employ separate counsel in any such
action, suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such Underwriter or
such controlling person unless (i) the Trust or the Company has agreed in
writing to pay such fees and expenses, (ii) the Trust or the Company has failed
to assume the defense and employ counsel, or (iii) the named parties to any such
action, suit or proceeding (including any impleaded parties) include both such
Underwriter or such controlling person and the Trust or the Company, and such
Underwriter or such controlling person shall have been advised by its counsel
that representation of such indemnified party and the Trust or the Company by
the same counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same counsel has
been proposed) due to actual or potential differing interests between them (in
which case the Trust or the Company shall not have the right to assume the
defense of such action, suit or proceeding on behalf of such Underwriter or such
controlling person). It is understood, however, that the Trust and the Company
together shall, in connection with any one such action, suit or proceeding or
separate but substantially similar or related actions, suits or proceedings in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
all such Underwriters and controlling persons not having actual or potential
differing interests with you or among themselves, which firm shall be designated
in writing by Smith Barney Inc., and that all such fees and expenses shall be
reimbursed as they are incurred. The Trust and the Company shall not be liable
for any settlement of any such action, suit or proceeding effected without the
Company's written consent, but if settled with such written consent, or if there
be a final judgment for the plaintiff in any such action, suit or proceeding,
the Trust and the Company agree to indemnify and hold harmless any Underwriter,
to the extent provided in the preceding paragraph, and any such controlling
person from and against any loss, claim, damage, liability or expense by reason
of such settlement or judgment.
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<PAGE>
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Trust, the Company, the Company's directors, the Company's
officers and the TRV Trustees who sign the Registration Statement, and any
person who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, to the same extent as the
foregoing indemnity from the Trust and the Company to each Underwriter, but only
with respect to information relating to such Underwriter furnished in writing by
or on behalf of such Underwriter through you expressly for use in the
Registration Statement, the Prospectus or any Prepricing Prospectus, or any
amendment or supplement thereto. If any action, suit or proceeding shall be
brought against the Trust, the Company, any of the Company's directors, any such
officer or trustee, or any such controlling person, based on the Registration
Statement, the Prospectus or any Prepricing Prospectus, or any amendment or
supplement thereto, and in respect of which indemnity may be sought against any
Underwriter pursuant to this paragraph (c), such Underwriter shall have the
rights and duties given to the Trust or the Company by paragraph (b) above
(except that if the Trust or the Company shall have assumed the defense thereof,
such Underwriter shall not be required to do so, but may employ separate counsel
therein and participate in the defense thereof, but the fees and expenses of
such counsel shall be at such Underwriter's expense), and the Trust, the
Company, the Company's directors, any such officer or trustee, and any such
controlling person shall have the rights and duties given to the Underwriters by
paragraph (b) above. The foregoing indemnity agreement shall be in addition to
any liability which the Underwriters may otherwise have.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Trust and the Company on the one hand and the Underwriters on the other hand
from the offering of the Preferred Securities, or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Trust and the Company
on the one hand and the Underwriters on the other in connection with the
statements or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Trust and the Company on the one hand and
the Underwriters on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses) received by
the Trust bear to the total Underwriting Compensation received by the
Underwriters, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault of the Trust and the Company on the one hand and
the Underwriters on the other hand shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Offerors on the one hand or by the Underwriters on
the other hand and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
(e) The Trust, the Company and the Underwriters agree that it would
not be just and equitable if contribution pursuant to this Section 7 were
determined by a pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation that does not
take account of the equitable considerations referred to in paragraph (d) above.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities and expenses referred to in paragraph (d) above
shall be deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 7, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price of the Preferred Securities underwritten by it and distributed to
the public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was
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<PAGE>
not guilty of such fraudulent misrepresentation. The Underwriters' obligations
to contribute pursuant to this Section 7 are several in proportion to the
respective numbers of Preferred Securities set forth opposite their names in
Schedule I hereto (or such numbers of Preferred Securities increased as set
forth in Section 10 hereof) and not joint.
(f) No indemnifying party shall, without the prior written consent
of the indemnified party, effect any settlement, compromise or consent relating
to any pending or threatened action, suit or proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement, compromise
or consent (i) includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such action, suit or
proceeding and (ii) does not include a statement as to or an admission of fault
or culpability by or on behalf of any indemnified party.
(g) Any losses, claims, damages, liabilities or expenses for which
an indemnified party is entitled to indemnification or contribution under this
Section 7 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Trust and the Company set forth in this
Agreement shall remain operative and in full force and effect, regardless of (i)
any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter, the Trust, the Company, the Company's directors or
officers, the TRV Trustees, or any person controlling the Company, (ii)
acceptance of any Preferred Securities and payment therefor hereunder, and (iii)
any termination of this Agreement. A successor to any Underwriter or any person
controlling any Underwriter, or to the Trust, the Company, the Company's
directors or officers, the TRV Trustees, or any person controlling the Company,
shall be entitled to the benefits of the indemnity, contribution, and
reimbursement agreements contained in this Section 7.
8. Conditions of Underwriters' Obligations. The obligations of the
several Underwriters to purchase and pay for the Securities as provided herein
shall be subject to the accuracy, as of the date of this Agreement and the
Closing Date (as if made at the Closing Date), of the representations and
warranties of the Offerors herein, to the performance by the Offerors of their
obligations hereunder, and to the following additional conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the registration statement or a post-effective amendment thereto
(or an Additional Registration Statement) to be declared or to become effective
before the offering of the Preferred Securities may commence, the registration
statement or such post-effective amendment or Additional Registration Statement
shall have become effective not later than 5:30 P.M., New York City time, on the
date hereof, or at such later date and time as shall be consented to in writing
by you, and all filings, if any, required by Rules 424 and 430A under the
Securities Act shall have been timely made; and no stop order suspending the
effectiveness of the registration statement shall have been issued and no
proceeding for that purpose shall have been instituted or, to the knowledge of
the Offerors or any Underwriter, threatened by the Commission, and any request
of the Commission for additional information (to be included in the registration
statement or the Prospectus or otherwise) shall have been complied with to your
satisfaction.
(b) Subsequent to the effective date of this Agreement, there shall
not have occurred (i) any change, or any development involving a prospective
change, in or affecting the business or properties of the Company or its
subsidiaries which, in the judgment of a majority in interest of the
Underwriters, including the Representatives, materially impairs the investment
quality of the Preferred Securities, or (ii) any event or development relating
to or involving the Company or any officer or director of the Company which
makes any statement made in the Prospectus untrue or which, in the opinion of
the Company and its counsel or the Underwriters and their counsel, requires the
making of any addition to or change in the Prospectus in order to state a
material fact required by the Securities Act or any other law to be stated
therein or necessary in order to make the statements therein not misleading, if
amending or supplementing
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<PAGE>
the Prospectus to reflect such event or development would, in your opinion, as
Representatives of the several Underwriters, materially adversely affect the
market for the Preferred Securities.
(c) You shall have received an opinion, dated the Closing Date, of
Skadden, Arps, Slate, Meagher & Flom LLP, special counsel to the Offerors,
substantially in the form attached hereto as Exhibit A. Insofar as such opinion
involves factual matters, such counsel may rely, to the extent such counsel
deems proper, upon certificates of officers of the Company, its subsidiaries and
the Trust and certificates of public officials.
(d) You shall have received an opinion, dated the Closing Date, of
Charles O. Prince, III, Esq., Executive Vice President and General Counsel of
the Company, substantially in the form attached hereto as Exhibit B.
(e) You shall have received an opinion, dated the Closing Date, of
Skadden, Arps, Slate, Meagher & Flom LLP, special tax counsel to the Company and
the Trust, substantially in the form attached hereto as Exhibit C.
(f) You shall have received an opinion, dated the Closing Date, of
Seward & Kissel, counsel to Chase, substantially in the form attached hereto as
Exhibit D.
(g) You shall have received an opinion, dated the Closing Date, of
Dewey Ballantine, counsel for the Underwriters, substantially in the form
attached hereto as Exhibit E.
(h) The Company and the Trust shall each have furnished to you a
certificate, dated the Closing Date, and, in the case of the Company, signed by
the Chairman of the Board, any Vice Chairman, the President, any Executive Vice
President, any Vice President, the Treasurer or Firoz B. Tarapore, a Deputy
Treasurer of the Company, and the principal financial or accounting officer of
the Company and, in the case of the Trust, signed by one of the Regular Trustees
to the effect that the signers of such certificate have carefully examined the
Registration Statement, the Prospectus and this Agreement and that:
(i) the representations and warranties of the Company or the
Trust, as the case may be, in this Agreement are true and correct on and
as of the Closing Date with the same effect as if made on the Closing
Date, and the Company or the Trust, as the case may be, has complied in
all material respects with all the agreements and satisfied all the
conditions on its part to be performed or satisfied by it hereunder at or
prior to the Closing Date;
(ii) no stop order suspending the effectiveness of
Registration Statement has been issued, and no proceedings for that
purpose have been instituted or, to their knowledge, threatened;
(iii) the Registration Statement, including any supplements or
amendments thereto, does not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; the Prospectus,
including any supplements or amendments thereto, does not contain any
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; and since the effective date of the Registration Statement
there has not occurred any event concerning which information is required
to be contained in an amended or supplemented Prospectus concerning which
such information is not contained therein; and
(iv) there have been no material adverse changes in the
general affairs of the Company and its subsidiaries taken as a whole or
the Trust, as the case may be, or in the financial
12
<PAGE>
position as shown by information contained in the Registration Statement
and the Prospectus, other than changes disclosed in or contemplated by the
Registration Statement and the Prospectus.
(i) You shall have received on the Closing Date a letter from KPMG
Peat Marwick LLP, dated the Closing Date, substantially in the form heretofore
approved by you.
(j) On or after the date of this Agreement no downgrading shall have
occurred in the rating accorded the Preferred Securities or the Company's debt
securities by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Securities Act).
(k) The Preferred Securities shall have been registered under the
Exchange Act and shall have been listed or approved for listing, upon notice of
issuance, on the New York Stock Exchange.
(l) Prior to the Closing Date, the Company shall have furnished to
you such further information, certificates and documents as you may reasonably
request.
The obligations of the Underwriters to purchase any Additional
Preferred Securities hereunder are subject to the satisfaction on and as of any
Option Closing Date of the conditions set forth in this Section 8, except that,
if any Option Closing Date is other than the Closing Date, the certificates,
opinions and letters referred to in this Section 8 shall be dated the Option
Closing Date and shall be revised to reflect the sale of the Additional
Preferred Securities.
9. Expenses. The Company agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance by it and
by the Trust of its and the Trust's respective and joint obligations hereunder:
(i) the preparation, printing or reproduction, and filing (including filing
fees) with the Commission of the registration statement (including financial
statements and exhibits thereto), each Prepricing Prospectus, the Prospectus,
each amendment or supplement to any of them, this Agreement, the Declaration,
the Guarantee, the Indenture and the Statement of Eligibility and Qualification
of each of the Institutional Trustee, the Guarantee Trustee and the Indenture
Trustee; (ii) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such copies of
the registration statement, each Prepricing Prospectus, the Prospectus, the
documents incorporated by reference in the Registration Statement, and all
amendments or supplements to any of them, as may be reasonably requested for use
in connection with the offering and sale of the Preferred Securities; (iii) the
preparation, printing (or reproduction), execution and delivery of the
Declaration, the Guarantee and the Indenture and the preparation, printing,
authentication, issuance and delivery of the Securities, including any stamp
taxes in connection with the original issuance and sale of the Preferred
Securities; (iv) the printing (or reproduction) and delivery of this Agreement,
the preliminary and supplemental Blue Sky Memoranda and all other agreements or
documents printed (or reproduced) and delivered in connection with the offering
of the Preferred Securities; (v) the registration of the Securities under the
Exchange Act and the listing of the Preferred Securities on the New York Stock
Exchange; (vi) the registration or qualification of the Securities for offer and
sale under the securities or Blue Sky laws of the several states as provided in
Section 5(g) hereof (including the reasonable fees, expenses and disbursements
of counsel for the Underwriters relating to the preparation, printing (or
reproduction), and delivery of the preliminary and supplemental Blue Sky
Memoranda and such registration and qualification); (vii) the filing fees and
the reasonable fees and expenses of counsel for the Underwriters in connection
with any filings required to be made with the National Association of Securities
Dealers, Inc.; (viii) the fees and expenses of the Institutional Trustee, the
Delaware Trustee, the Guarantee Trustee and the Indenture Trustee; (ix) the fees
and expenses associated with obtaining ratings for the Preferred Securities from
nationally recognized statistical rating organizations; (x) the transportation
and other expenses incurred by or on behalf of representatives of the Offerors
(other than the Underwriters and their representatives) in connection with
presentations to prospective purchasers of the Preferred Securities; and (xi)
the fees and expenses of the Company's accountants and the fees and expenses of
counsel (including local and special counsel) for the Offerors.
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<PAGE>
10. Effective Date of Agreement. This Agreement shall become
effective: (i) upon the execution and delivery hereof by the parties hereto; or
(ii) if, at the time this Agreement is executed and delivered, it is necessary
for the registration statement or a post-effective amendment thereto or an
Additional Registration Statement to be declared effective before the offering
of the Preferred Securities may commence, when notification of the effectiveness
of the registration statement or such post-effective amendment has been released
by the Commission or, in the case of an Additional Registration Statement, upon
the filing of such Additional Registration Statement. Until such time as this
Agreement shall have become effective, it may be terminated by the Company or
the Trust, by notifying you, or by you, as Representatives of the several
Underwriters, by notifying the Offerors.
If any one or more of the Underwriters shall fail or refuse to
purchase Firm Preferred Securities which it or they are obligated to purchase
hereunder, and the aggregate number of Firm Preferred Securities which such
defaulting Underwriter or Underwriters are obligated but fail or refuse to
purchase is not more than one-tenth of the aggregate number of the Firm
Preferred Securities, each non-defaulting Underwriter shall be obligated,
severally, in the proportion which the number of Firm Preferred Securities set
forth opposite its name in Schedule I hereto bears to the aggregate number of
Firm Preferred Securities set forth opposite the names of all non-defaulting
Underwriters, to purchase the Firm Preferred Securities which such defaulting
Underwriter or Underwriters are obligated, but fail or refuse, to purchase. If
any Underwriter or Underwriters shall fail or refuse to purchase Firm Preferred
Securities and the aggregate number of Firm Preferred Securities with respect to
which such default occurs is more than one-tenth of the aggregate number of the
Firm Preferred Securities and arrangements satisfactory to you and the Offerors
for the purchase of such Firm Preferred Securities by one or more non-defaulting
Underwriters or other party or parties approved by you and the Offerors are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Offerors. In any
such case which does not result in termination of this Agreement, either you or
the Offerors shall have the right to postpone the Closing Date, but in no event
for longer than seven days, in order that the required changes, if any, in the
Registration Statement and the Prospectus or any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any such default of any such
Underwriter under this Agreement. The term "Underwriter" as used in this
Agreement includes, for all purposes of this Agreement, any party not listed in
Schedule I hereto who, with your approval and the approval of the Offerors,
purchases Firm Preferred Securities which a defaulting Underwriter is obligated,
but fails or refuses, to purchase.
Any notice under this Section 10 may be given by telegram, telecopy
or telephone but shall be subsequently confirmed by letter.
11. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Offerors, by notice to the Offerors, if prior to the Closing
Date or any Option Closing Date (if different from the Closing Date and then
only as to the Additional Preferred Securities) there shall have occurred: (i)
any suspension or limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such exchange,
or any suspension of trading of any securities of the Company on any exchange or
in the over-the-counter market; (ii) any banking moratorium declared by Federal
or New York authorities; or (iii) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress or any other substantial national or international calamity or
emergency if, in the judgment of a majority in interest of the Underwriters,
including the Representatives, the effect of any such outbreak, escalation,
declaration, calamity or emergency makes it impractical or inadvisable to
proceed with completion of the sale of and payment for the Securities. Notice of
such termination may be given to the Company by telegram, telecopy or telephone
and shall be subsequently confirmed by letter.
12. Information Furnished by the Underwriters. The statements set
forth in the last paragraph on the cover page, the stabilization legend on the
third page, and the statements in the first paragraph, the seventh paragraph,
the ninth paragraph and the tenth paragraph under the caption
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<PAGE>
"Underwriting" in the Prospectus Supplement and the stabilization legend on the
third page in the Prospectus, constitute the only information furnished by or on
behalf of the Underwriters through you as such information is referred to in
Sections 6(b) and 7 hereof.
13. Miscellaneous. Except as otherwise provided herein, notice given
pursuant to any provision of this Agreement shall be in writing and shall be
delivered (i) if to the Offerors, to the Company, or to the Trust care of the
Company, at the office of the Company at 388 Greenwich Street, New York, New
York 10013, Attention: Charles O. Prince, III, Esq., Executive Vice President
and General Counsel, with a copy to Skadden, Arps, Slate, Meagher & Flom LLP,
919 Third Avenue, New York, New York 10022, Attention: Kenneth J. Bialkin; or
(ii) if to you, as Representatives of the several Underwriters, care of Smith
Barney Inc., 388 Greenwich Street, New York, New York 10013, Attention: Manager,
Investment Banking Division, with a copy to General Counsel, Investment Banking
Division, and to Dewey Ballantine, 1301 Avenue of the Americas, New York, New
York 10019, Attention: Frederick W. Kanner.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Trust, the Company, the Company's directors and
officers, the TRV Trustees, and the other controlling persons referred to in
Section 7 hereof and their respective successors and assigns, to the extent
provided herein, and no other person shall acquire or have any right under or by
virtue of this Agreement. Neither the term "successor" nor the term "successors
and assigns" as used in this Agreement shall include a purchaser from any
Underwriter of any of the Preferred Securities in his status as such purchaser.
14. Applicable Law; Counterparts. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York applicable
to contracts made and to be performed within the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
15
<PAGE>
Please confirm that the foregoing correctly sets forth the agreement
among the Trust, the Company and the several Underwriters.
Very truly yours,
TRAVELERS CAPITAL
By
------------------------------------
as Regular Trustee
By
------------------------------------
as Regular Trustee
TRAVELERS GROUP INC.
By
------------------------------------
Name:
Title:
Confirmed as of the date first above mentioned on behalf of themselves and the
other several Underwriters named in Schedule I
hereto.
SMITH BARNEY INC.
[Co-Managers]
As Representatives of the Several Underwriters
By SMITH BARNEY INC.
By
------------------------------
Managing Director
16
<PAGE>
SCHEDULE I
TRAVELERS CAPITAL I
____% Trust Preferred Securities
Number of Firm
Underwriters Preferred Securities
- ------------ --------------------
Smith Barney Inc. ...................................... ________________
Total............................................. ================
<PAGE>
TRAVELERS GROUP INC.
PREFERRED STOCK AND DEPOSITARY SHARES
UNDERWRITING AGREEMENT BASIC PROVISIONS
May __, 1997
To the Representative or Representatives
named in the Terms Agreement referred
to below
Travelers Group Inc., a Delaware corporation (the "Company"), may issue
and sell from time to time series of its preferred stock, par value $1.00 per
share (the "Preferred Stock"). Such series of Preferred Stock may have varying
designations, denominations, dividend rates and payment dates, conversion,
exchange, redemption or sinking fund provisions, liquidation preferences and
selling prices. The Company may also sell from time to time depositary shares
(the "Depositary Shares") each representing a stated fractional interest in a
share of a series of Preferred Stock. The basic provisions set forth herein are
intended to be incorporated by reference in a terms agreement of the type
referred to in Section 1 hereof relating to the series of Preferred Stock, or
the Depositary Shares, to be issued and sold by the Company pursuant thereto
(the "Firm Securities") to the several underwriters named therein (the
"Underwriters"). The Terms Agreement relating to the Firm Securities (the "Terms
Agreement") may also provide for the Company to issue and sell to the
Underwriters up to a specified additional number of shares of Preferred Stock of
such series, or to sell to the Underwriters up to a specified additional number
of such Depositary Shares (such additional shares of Preferred Stock or
additional Depositary Shares, the "Additional Securities"), upon the terms and
conditions set forth herein and in the Terms Agreement, if and to the extent the
Underwriters determine to exercise their option to purchase such Additional
Securities. The Terms Agreement may also authorize the Underwriters to solicit
institutional investors to purchase Contract Securities (as defined below)
pursuant to delayed delivery contracts ("Delayed Delivery Contracts"). The
shares of Preferred Stock, or the Depositary Shares, to be issued and sold
pursuant to the Terms Agreement (including the Firm Securities, the Additional
Securities, if any, and the Contract Securities (as defined below), if any) are
hereinafter referred to as the "Securities." The Terms Agreement, together with
the provisions hereof incorporated therein by reference, is herein referred to
as this "Agreement."
Depositary Shares will be issued by the Depositary named in the Terms
Agreement pursuant to a Deposit Agreement (the
<PAGE>
"Deposit Agreement") to be entered into between the Company and the Depositary,
on behalf of the holders from time to time of the Depositary Shares. The
Depositary Shares will be evidenced by Depositary Receipts issued pursuant to
the Deposit Agreement (the "Depositary Receipts"). The shares of Preferred Stock
relating to the Depositary Shares are hereinafter referred to as the "Underlying
Preferred Shares."
If the Underwriters consist only of the firm or firms referred to in the
Terms Agreement as Representative or Representatives, then the terms
"Underwriters" and "Representatives," as used herein, shall each be deemed to
refer to such firm or firms.
1. Terms Agreement. The obligation of the Underwriters to purchase, and
the Company to sell, the Securities is evidenced by the Terms Agreement
delivered at the time the Company determines to sell the Securities. The Terms
Agreement specifies the firm or firms which will be Underwriters, the number of
shares of the Firm Securities to be purchased by each Underwriter, the number of
shares of the Additional Securities, if any, the purchase price to be paid by
the Underwriters for the Securities, the public offering price, if any, of the
Securities, whether the Underwriters are authorized to solicit institutional
investors to purchase Contract Securities pursuant to Delayed Delivery
Contracts, certain terms thereof and the Underwriters' compensation therefor and
any other terms of the Securities, including, but not limited to, designations,
denominations, dividend rates and payment dates, conversion, exchange,
redemption or sinking fund provisions and liquidation preferences. The Terms
Agreement specifies any details of the terms of the offering that should be
reflected in a post-effective amendment to the Registration Statement or the
Prospectus Supplement (each as hereinafter defined).
2. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with each Underwriter that:
(a) A registration statement on Form S-3 (File No. 33-_______),
including a prospectus, relating to the Securities and the Underlying
Preferred Shares has been prepared by the Company in conformity in all
material respects with the requirements of the Securities Act of 1933, as
amended (the "Act"), and the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission")
thereunder, and has been filed with the Commission and has become
effective. Such registration statement and prospectus may have been
amended or supplemented from time to time prior to the date of this
Agreement; any such amendment to the registration statement was so
2
<PAGE>
prepared and filed and any such amendment has become effective. A
prospectus supplement (the "Prospectus Supplement"), including a
prospectus, relating to the Securities and the Underlying Preferred Shares
has been so prepared and will be filed pursuant to Rule 424 under the Act.
Copies of such registration statement and prospectus, any such amendment
or supplement, the Prospectus Supplement and all documents incorporated by
reference therein which were filed with the Commission on or prior to the
date of the Terms Agreement have been delivered to you. Such registration
statement and prospectus, as amended or supplemented to the date of the
Terms Agreement and as supplemented by the Prospectus Supplement, are
herein collectively referred to as the "Registration Statement" and the
"Prospectus", respectively. Any references herein to the Registration
Statement or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein which were filed with the
Commission on or prior to the date of the Terms Agreement, and any
reference to the terms "amend", "amendment" or "supplement" with respect
to the Registration Statement or the Prospectus shall be deemed to refer
to and include the filing of any document with the Commission deemed to be
incorporated by reference therein after the date of the Terms Agreement.
(b) The registration statement, at the time it became effective, any
post-effective amendment thereto, at the time it became effective, the
Registration Statement and the Prospectus, as of the date of the Terms
Agreement and at the Closing Date (as hereinafter defined), and any
amendment or supplement thereto, conformed or will conform in all material
respects to the requirements of the Act and the Rules and Regulations; and
no such document included or will include an untrue statement of a
material fact or omitted or will omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; except that the foregoing shall not apply to statements in or
omissions from any such document in reliance upon, and in conformity with,
written information furnished to the Company by or on behalf of any
Underwriter through you, specifically for use in the preparation thereof.
(c) The documents incorporated by reference in the Registration
Statement or the Prospectus, when they became effective or were filed with
the Commission, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), conformed, and any documents so
filed and incorporated by reference after the date of the Terms Agreement
will, when they are filed with the Commission, conform, in all material
respects to the requirements of the Act and the Exchange Act, as
3
<PAGE>
applicable, and the rules and regulations of the Commission thereunder.
3. Purchase, Sale and Delivery of Securities. If so authorized in the
Terms Agreement, the Underwriters may solicit offers from investors of the types
set forth in the Prospectus to purchase Securities from the Company pursuant to
Delayed Delivery Contracts. Such contracts shall be substantially in the form of
Exhibit I hereto but with such changes therein as the Company may approve.
Securities to be purchased pursuant to Delayed Delivery Contracts are herein
called "Contract Securities." When Delayed Delivery Contracts are authorized in
the Terms Agreement, the Company will enter into a Delayed Delivery Contract in
each case where a sale of Contract Securities arranged through you has been
approved by the Company but, except as the Company may otherwise agree, such
Delayed Delivery Contracts must be for at least the minimum number of shares of
Contract Securities set forth in the Terms Agreement, and the aggregate number
of shares of Contract Securities may not exceed the number set forth in the
Terms Agreement. The Company will advise you not later than 10:00 A.M., New York
City time, on the second full business day preceding the Closing Date (or at
such later time as you may otherwise agree) of the sales of the Contract
Securities which have been so approved. You and the other Underwriters will not
have any responsibility in respect of the validity or performance of Delayed
Delivery Contracts.
The number of shares of the Firm Securities to be purchased by each
Underwriter as set forth in the Terms Agreement shall be reduced by a number
which shall bear the same proportion to the total number of shares of Contract
Securities as the number of shares of Firm Securities set forth opposite the
name of such Underwriter bears to the total number of shares of Firm Securities
set forth in the Terms Agreement, except to the extent that you determine that
such reduction shall be otherwise than in such proportion and so advise the
Company; provided, however, that the total number of shares of Firm Securities
to be purchased by all Underwriters shall be the total number of shares of Firm
Securities set forth in the Terms Agreement less the aggregate number of shares
of Contract Securities.
Payment for the Firm Securities and any Additional Securities shall be
made by wire transfer to such account or accounts specified by the Company of
same-day funds on the date and at the time specified in the Terms Agreement (or
at such other time not later than eight full business days thereafter as you
and the Company determine), such time being herein referred to as the "Firm
Closing Date" or the "Option Closing Date," as the case may be. (The Firm
Closing Date and the Option Closing Date are hereinafter sometimes referred to
as a "Closing Date.")
4
<PAGE>
Payment for any Firm Securities and Additional Securities that are in the
form of Depositary Shares shall be made against delivery to you on the Firm
Closing Date or the Option Closing Date, as the case may be, for the respective
accounts of the several Underwriters of Depositary Receipts (in either temporary
or definitive form) evidencing such Firm Securities or Additional Securities, as
the case may be, registered in the names and in such denominations as you shall
request upon at least two business days' prior notice to the Company, with any
transfer taxes payable in connection with the transfer thereof to the
Underwriters duly paid.
Certificates for any Firm Securities and Additional Securities that are in
the form of shares of Preferred Stock shall be in definitive form and registered
in the names and in such denominations as you shall request upon at least two
business days' notice to the Company prior to the Firm Closing Date or the
Option Closing Date, as the case may be. The certificates representing such
Securities shall be delivered to you on such Closing Date for the respective
accounts of the several Underwriters, with any transfer taxes payable in
connection with the transfer thereof to the Underwriters duly paid, against
payment of the purchase price therefor.
The certificates representing the Securities will be made available for
checking and packaging at the office at which they are to be delivered on the
Firm Closing Date or the Option Closing Date, as the case may be (or such other
office as may be specified for that purpose in the Terms Agreement), at least
one business day prior to such Closing Date.
The obligations of the Underwriters to purchase the Securities will be
several and not joint. It is understood that the Underwriters propose to offer
the Securities for sale as set forth in the Prospectus.
It is understood that you, acting individually and not in a representative
capacity, may (but shall not be obligated to) make payment to the Company on
behalf of any other Underwriter for Securities to be purchased by such
Underwriter. Any such payment by you shall not relieve any such Underwriter of
any of its obligations hereunder.
The Company will pay to you on the Closing Date for the accounts of the
Underwriters any fee, commission or other compensation specified in the Terms
Agreement. Such payment will be made by wire transfer of same-day funds.
5
<PAGE>
4. Covenants. The Company covenants and agrees with each Underwriter that:
(a) The Company will cause the Prospectus Supplement to be filed
pursuant to Rule 424 under the Act and will notify you promptly of such
filing. During the period in which a prospectus relating to the Securities
is required to be delivered under the Act, the Company will notify you
promptly of the time when any amendment to the Registration Statement has
become effective or any subsequent supplement to the Prospectus has been
filed and of any request by the Commission for any amendment of or
supplement to the Registration Statement or the Prospectus or for
additional information; it will prepare and file with the Commission,
promptly upon your request, any amendments or supplements to the
Registration Statement or the Prospectus which, in your opinion, may be
necessary or advisable in connection with the distribution of the
Securities by the Underwriters; it will file no amendment or supplement to
the Registration Statement or the Prospectus (other than any prospectus
supplement relating to the offering of securities other than the
Securities registered under the Registration Statement or any document
required to be filed under the Exchange Act which upon filing is deemed to
be incorporated by reference therein) to which you shall reasonably object
by notice to the Company after having been furnished a copy a reasonable
time prior to the filing; and it will furnish to you at or prior to the
filing thereof a copy of any such prospectus supplement or any document
which upon filing is deemed to be incorporated by reference in the
Registration Statement or Prospectus.
(b) The Company will advise you, promptly after it shall receive
notice or obtain knowledge thereof, of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement,
of the suspension of the qualification of the Securities for offering or
sale in any jurisdiction, or of the initiation or threatening of any
proceeding for any such purpose; and it will promptly use its best efforts
to prevent the issuance of any stop order or to obtain its withdrawal if
such a stop order should be issued.
(c) Within the time during which a prospectus relating to the
Securities is required to be delivered under the Act, the Company will
comply with all requirements imposed upon it by the Act, as now and
hereafter amended, and by the Rules and Regulations, as from time to time
in force, so far as necessary to permit the continuance of sales of or
dealings in the Securities as contemplated by the provisions hereof and
the
6
<PAGE>
Prospectus. If during such period any event occurs as a result of which
the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state a material fact necessary to
make the statements therein, in the light of the circumstances then
existing, not misleading, or if during such period it is necessary to
amend or supplement the Registration Statement or the Prospectus to comply
with the Act, the Company will promptly notify you and will amend or
supplement the Registration Statement or the Prospectus (at the expense of
the Company) so as to correct such statement or omission or effect such
compliance.
(d) The Company will use its best efforts to qualify the Securities
for sale under the securities laws of such jurisdictions as you reasonably
designate, to maintain such qualifications in effect so long as required
for the distribution of the Securities and, if requested by the
Underwriters, to arrange for the determination of the legality of the
Securities for purchase by institutional investors, except that the
Company shall not be required in connection therewith to qualify to do
business in any jurisdiction where it is not now so qualified or to take
any action which would subject it to general or unlimited service of
process in any jurisdiction where it is not now so subject.
(e) The Company will furnish to the Underwriters copies of the
Registration Statement and the Prospectus (including all documents
incorporated by reference therein), and all amendments and supplements to
the Registration Statement or the Prospectus which are filed with the
Commission during the period in which a prospectus relating to the
Securities is required to be delivered under the Act (including all
documents filed with the Commission during such period which are deemed to
be incorporated by reference therein), in each case in such quantities as
you may from time to time reasonably request.
(f) So long as any of the Securities are outstanding, the Company
agrees to furnish to you, upon your request (i) as soon as available,
copies of all reports to the Company's security holders generally and (ii)
all reports and financial statements filed by or on behalf of the Company
with the Commission or any national securities exchange.
(g) The Company will make generally available to its security
holders and to you as soon as practicable, but in any event not later than
15 months after the end of the Company's current fiscal quarter, an
earnings
7
<PAGE>
statement (which need not be audited) covering a 12-month period beginning
after the date upon which the Prospectus Supplement is filed pursuant to
Rule 424 under the Act, which shall satisfy the provisions of Section
11(a) of the Act.
(h) The Company, whether or not the transactions contemplated
hereunder are consummated or this Agreement is terminated, will pay all
expenses incident to the performance of its obligations hereunder,
including, without limiting the generality of the foregoing, all costs,
taxes and expenses incident to the issue and delivery of the Securities,
all fees and expenses of the Company's counsel and accountants, and all
costs and expenses incident to the preparing, printing, filing and
distributing of all documents relating to the offering, and will reimburse
the Underwriters for any expenses (including fees and disbursements of
counsel not exceeding the amount, if any, specified in the Terms
Agreement) incurred by them in connection with the matters referred to in
Section 4(d) hereof and the preparation of memoranda relating thereto, for
any filing fee of the National Association of Securities Dealers, Inc.
relating to the Securities, and for any fees charged by investment rating
agencies for rating the Securities. If the sale of Securities provided for
in this Agreement is not consummated by reason of any failure, refusal or
inability on the part of the Company to perform any agreement on its part
to be performed, or because any other condition of the Underwriters'
obligations hereunder required to be fulfilled by the Company is not
fulfilled, the Company will reimburse the Underwriters for all reasonable
out-of-pocket disbursements (including fees and disbursements of counsel)
incurred by the Underwriters in connection with the proposed purchase and
sale of the Securities.
(i) If so stated in the Terms Agreement, the Company will use its
best efforts to cause an application for the listing of the Securities on
the New York Stock Exchange or such other securities exchange specified in
the Terms Agreement and for the registration of the Securities under the
Exchange Act to become effective.
(j) The Company will not, without your consent, offer or sell, or
publicly announce its intention to offer or sell, any shares of Preferred
Stock (except under prior contractual commitments) during the period
beginning the date of the Terms Agreement and ending the business day
following the earlier to occur of (i) the later of the Firm Closing Date
or, if applicable, the Option Closing Date and (ii) the expiration of the
period, if any, during which the Underwriters may
8
<PAGE>
exercise their option to purchase Additional Securities, if such option
has not been exercised.
5. Conditions of the Underwriters' Obligations. The obligations of the
Underwriters to purchase and pay for the Securities as provided therein shall be
subject to the accuracy, as of the date of the Terms Agreement and the Firm
Closing Date or the Option Closing Date, as the case may be (as if made at such
Closing Date), of the representations and warranties of the Company herein, to
the performance by the Company of its obligations hereunder, and to the
following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that purpose shall
have been instituted or, to the knowledge of the Company or any
Underwriter, threatened by the Commission, and any request of the
Commission for additional information (to be included in the Registration
Statement or the Prospectus or otherwise) shall have been complied with to
your satisfaction.
(b) Subsequent to the execution of the Terms Agreement, there shall
not have occurred (i) any change, or any development involving a
prospective change, in or affecting particularly the business or
properties of the Company or its subsidiaries which, in the judgment of a
majority in interest of the Underwriters, including any Representatives,
materially impairs the investment quality of the Securities; (ii) any
downgrading in the rating of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act); (iii) any suspension or limitation
of trading in securities generally on the New York Stock Exchange, or any
setting of minimum prices for trading on such exchange, or any suspension
of trading of any securities of the Company on any exchange or in the
over-the-counter market; (iv) any banking moratorium declared by Federal
or New York authorities; or (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war
by Congress or any other substantial national or international calamity or
emergency if, in the judgment of a majority in interest of the
Underwriters, including any Representatives, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the sale of and
payment for the Securities.
9
<PAGE>
(c) The Company shall have furnished you the opinion, dated the
Closing Date, of the General Counsel of the Company or such other
counsel to the Company as may be acceptable to you to the effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware
with corporate power and authority to own its properties and conduct
its business as described in the Prospectus;
(ii) The Company is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in which it
owns or leases substantial properties or in which the conduct of its
business requires such qualification and the failure so to qualify
would have a material adverse effect on the Company;
(iii) The authorized capital stock of the Company, the
Securities, the Underlying Preferred Shares, the Depositary Receipts
and the Deposit Agreement conform in all material respects to the
descriptions thereof in the Prospectus;
(iv) The shares of Preferred Stock constituting the Securities
or the Underlying Preferred Shares, as the case may be, have been
validly authorized and, when issued and delivered as contemplated
hereby (and, in the case of any Contract Securities, as contemplated
by the Delayed Delivery Contracts with respect thereto), will be
validly issued, fully paid and non-assessable and will not be
subject to any preemptive or similar rights;
(v) The deposit of the Underlying Preferred Shares by the
Company in accordance with the Deposit Agreement has been duly
authorized and, when the Depositary Receipts representing the
Depositary Shares are issued and delivered as contemplated hereby
(and, in the case of any Contract Securities, as contemplated by the
Delayed Delivery Contracts with respect thereto), the Depositary
Shares will be validly issued, fully paid and non-assessable and
will not be subject to any preemptive or similar rights;
(vi) Assuming due authorization, execution and delivery of any
Deposit Agreement by the Depositary, each Depositary Share
represented by a Depositary Receipt issued thereunder will represent
the interest described in the Prospectus in a
10
<PAGE>
validly issued, outstanding, fully paid and non-assessable
Underlying Preferred Share; assuming due execution and delivery of
the Depositary Receipts by the Depositary pursuant to the Deposit
Agreement, the Depositary Receipts will entitle the holders thereof
to the benefits provided therein and in the Deposit Agreement;
(vii) The Deposit Agreement has been duly authorized, executed
and delivered by the Company and is a valid and binding agreement of
the Company;
(viii) The Terms Agreement (including the provisions of this
Agreement) and any Delayed Delivery Contracts have been duly
authorized, executed and delivered by the Company;
(ix) No consent, approval, authorization or order of any court
or governmental agency, authority or body is required for the
consummation by the Company of the transactions contemplated herein,
in any Delayed Delivery Contract, in the Certificate of Designation
relating to the series of Preferred Stock constituting the
Securities or to the Underlying Preferred Shares (the "Preferred
Shares Certificate of Designation") or in the Deposit Agreement,
except such as have been obtained under the Act and such as may be
required under the securities or blue sky laws of any jurisdiction
in connection with the sale of the Securities;
(x) The execution, delivery and performance of the Terms
Agreement (including the provisions of this Agreement), any Delayed
Delivery Contracts, the Preferred Shares Certificate of Designation
and the Deposit Agreement and the issuance and sale of the
Securities and compliance with the terms and provisions thereof will
not result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute, any rule,
regulation or order of any governmental agency or body or any court
having jurisdiction over the Company or any material subsidiary of
the Company or any of their properties or any agreement or
instrument known to such counsel to which the Company or any
material subsidiary of the Company is a party or by which the
Company or any such subsidiary is bound or to which any of the
properties of the Company or any such subsidiary is subject, or the
charter or by-laws of the Company or any such subsidiary;
11
<PAGE>
(xi) There are no contracts, agreements or understandings
known to such counsel between the Company and any person granting
such person the right to require the Company to include any
securities in the securities registered pursuant to the Registration
Statement; and
(xii) The Registration Statement has become effective under
the Act and, to the best of the knowledge of such counsel, no stop
order suspending the effectiveness thereof has been issued and no
proceedings for that purpose have been initiated or are pending or
threatened under the Act, and such registration statement, as of its
effective date, the Prospectus as of the date of the Terms Agreement
and the Closing Date and any amendment or supplement thereto, as of
its date and the Closing Date, comply as to form in all material
respects with the requirements of the Act and the Exchange Act and
the applicable Rules and Regulations (except that such counsel need
express no opinion as to the financial statements or other data of a
financial or statistical nature); such counsel has no reason to
believe that such registration statement, as of its effective date,
or the Prospectus, as of the date of the Terms Agreement or the
Closing Date, or any such amendment or supplement, as of its date
and the Closing Date, contained any untrue statement of a material
fact or omitted or omits to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading (except as aforesaid); the descriptions in the
Registration Statement and Prospectus of statutes, legal and
governmental proceedings and contracts and other documents are
accurate and fairly present the information required to be shown;
and such counsel does not know of any legal or governmental
proceedings required to be described in the Prospectus which are not
described as required or of any contracts or documents of a
character required to be described in the Registration Statement or
Prospectus or to be filed as exhibits to the Registration Statement
which are not described and filed as required; it being understood
that such counsel need express no opinion as to the financial
statements or other data of a financial or statistical nature
contained in the Registration Statement or the Prospectus.
(d) You shall have received from your counsel, as specified in the
Terms Agreement, such opinion or opinions, dated the Closing Date, with
respect to the
12
<PAGE>
issuance and sale of the Securities, the Registration Statement, the
Prospectus and other related matters as you may reasonably require, and
the Company shall have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass upon such
matters.
(e) The Company shall have furnished to you a certificate, dated the
Closing Date, of the Chairman of the Board, President or any Vice
President and of the principal financial or accounting officer of the
Company to the effect that the signers of such certificate have carefully
examined the Registration Statement, the Prospectus and this Agreement and
that:
(i) the representations and warranties of the Company in this
Agreement are true and correct on and as of the Closing Date with
the same effect as if made on the Closing Date, and the Company has
complied in all material respects with all the agreements and
satisfied all the conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceedings for that
purpose have been instituted or, to their knowledge, threatened;
(iii) the Registration Statement, including any supplements or
amendments thereto, does not contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading; the Prospectus, including any supplements or amendments
thereto, does not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and since
the effective date of the Registration Statement there has not
occurred any event concerning which information is required to be
contained in an amended or supplemented Prospectus concerning which
such information is not contained therein; and
(iv) there have been no material adverse changes in the
general affairs of the Company and its subsidiaries taken as a whole
or in the financial position as shown by information contained in
the Registration Statement and the
13
<PAGE>
Prospectus, other than changes disclosed in or contemplated by the
Registration Statement and the Prospectus.
(f) You shall have received on the Closing Date a letter from KPMG
Peat Marwick LLP, dated the Closing Date, to the effect set forth in
Exhibit II hereto, with respect to the Registration Statement and the
Prospectus at the time of the Terms Agreement.
(g) Prior to the Closing Date, the Company shall have furnished to
you such further information, certificates and documents as you may
reasonably request.
6. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become
subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material
fact contained in the registration statement when it became effective, or
in the Registration Statement, the Prospectus, or any amendment or
supplement thereto, or any related preliminary prospectus supplement, or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading; and will reimburse each Underwriter
for any legal or other expenses reasonably incurred by it in connection
with investigating or defending against such loss, claim, damage,
liability or action; provided, however, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance
upon and in conformity with written information furnished to the Company
by or on behalf of any underwriter through you, specifically for use in
the preparation thereof; and provided further that the indemnification
contained in this paragraph (a) with respect to any preliminary
prospectus, the prospectus or any preliminary prospectus supplement shall
not inure to the benefit of any Underwriter (or to the benefit of any
person controlling such Underwriter) on account of any such loss, claim,
damage, liability or expense arising from the sale of the Securities by
such Underwriter to any person if a copy of the Prospectus shall not have
been delivered or sent to such person within the time required by the Act
and the Rules and Regulations thereunder, and the untrue statement or
alleged untrue statement or omission or
14
<PAGE>
alleged omission of a material fact contained in such preliminary
prospectus, prospectus or preliminary prospectus supplement was corrected
in the Prospectus, provided that the Company has delivered the Prospectus
to the several Underwriters in requisite quantity on a timely basis to
permit such delivery or sending.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company
may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any part of the registration statement when it
became effective, or in the Registration Statement, the Prospectus or any
amendment or supplement thereto, or any related preliminary prospectus
supplement, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to
the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made therein in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of any Underwriter, through you, specifically for
use in the preparation thereof, and will reimburse the Company for any
legal or other expenses reasonably incurred by the Company in connection
with investigating or defending against any such loss, claim, damage,
liability or action.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify the
indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under
such subsection. In case any such action shall be brought against any
indemnified party, and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate in and, to the extent that it shall wish, jointly with any
other indemnifying party, similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, be counsel to the
indemnified party), and after notice from the indemnifying party to such
indemnified party of its
15
<PAGE>
election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any
legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation.
(d) If the indemnification provided for in this Section 6 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a) or
(b) above, (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the
Underwriters on the other from the offering of the Securities, or (ii) if
the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Securities
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters, in
each case as set forth in the table on the cover page of the Prospectus
Supplement. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company or the Underwriters, and the
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such untrue statement or omission. The Company and
the Underwriters agree that it would not be just and equitable if
contributions pursuant to this subsection (d) were to be determined by pro
rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in the first sentence
of this subsection (d). The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the
first sentence of this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such
16
<PAGE>
indemnified party in connection with investigating or defending any action
or claim (which shall be limited as provided in subsection (c) above if
the indemnifying party has assumed the defense of any such action in
accordance with the provisions thereof) which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it
and distributed to the public were offered to the public exceeds the
amount of any damages which such Underwriter has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
The Underwriters' obligations in this subsection (d) to contribute shall
be several in proportion to their respective underwriting obligations and
not joint. Promptly after receipt by an indemnified party under this
subsection (d) of notice of the commencement of any action against such
party in respect of which a claim for contribution may be made against an
indemnifying party under this subsection (d), such indemnified party shall
notify the indemnifying party in writing of the commencement thereof if
the notice specified in subsection (c) above has not been given with
respect to such action; but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party otherwise than under this subsection (d).
(e) The obligations of the Company under this Section 6 shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act or the Exchange
Act; and the obligations of the Underwriters under this Section 6 shall be
in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to
each director of the Company (including any person who, with his consent,
is named in the Registration Statement as about to become a director of
the Company), to each officer of the Company who has signed the
Registration Statement and to each person, if any, who controls the
Company within the meaning of the Act or the Exchange Act.
7. Representations and Agreements to Survive Delivery. All
representations, warranties and agreements of the Company herein or in
certificates delivered pursuant hereto, and the
17
<PAGE>
agreements of the several Underwriters contained in Section 6 hereof, shall
remain operative and in full force and effect regardless of any investigation
made by or on behalf of any Underwriter or any controlling persons, or the
Company or any of its officers, directors or any controlling persons, and shall
survive delivery of and payment for the Securities.
8. Substitution of Underwriters. (a) If any Underwriter or Underwriters
shall fail to take up and pay for the number of shares of the Firm
Securities agreed by such Underwriter or Underwriters to be purchased
hereunder, upon tender of such Securities in accordance with the terms
hereof, and the number of such shares of the Firm Securities not purchased
does not aggregate more than 10% of the total number of shares of the Firm
Securities set forth in the Terms Agreement, the remaining Underwriters
shall be obligated to take up and pay for (in proportion to their
respective underwriting obligations hereunder as set forth in the Terms
Agreement, except as may otherwise be determined by you) the Securities
which the withdrawing or defaulting Underwriters agreed but failed to
purchase.
(b) If any Underwriter or Underwriters shall fail to take up and pay
for the number of shares of the Firm Securities agreed by such Underwriter
or Underwriters to be purchased hereunder, upon tender of such Securities
in accordance with the terms hereof, and the number of such shares of the
Firm Securities not purchased aggregates more than 10% of the total number
of shares of Firm Securities set forth in the Terms Agreement hereto, and
arrangements satisfactory to you and the Company for the purchase of such
Securities by other persons are not made within 36 hours thereafter, this
Agreement shall terminate. In the event of a default by any Underwriter as
set forth in this Section 8, the Closing Date shall be postponed for such
period, not to exceed seven full business days, as you shall determine
in order that the required changes in the Registration Statement and the
Prospectus or in any other documents or arrangements may be effected. In
the event of any such termination, the Company shall not be under any
liability to any Underwriter (except to the extent provided in Section
4(h) and Section 6 hereof) nor shall any Underwriter (other than an
Underwriter who shall have failed, otherwise than for some reason
permitted under this Agreement, to purchase the number of shares of
Securities agreed by such Underwriter to be purchased under this
Agreement) be under any liability to the Company (except to the extent
provided in Section 6 hereof). Nothing contained in this Agreement shall
relieve any defaulting Underwriter of its liability, if any, to the
Company and
18
<PAGE>
any non-defaulting Underwriter for damages occasioned by its default
hereunder.
9. Termination. You shall have the right to terminate this Agreement by
giving notice as hereinafter specified at any time at or prior to the Firm
Closing Date or the Option Closing Date, as the case may be, if (i) the Company
shall have failed, refused or been unable, at or prior to the Closing Date, to
perform, in any material respect, any agreement on its part to be performed
hereunder, or (ii) any other condition of the Underwriters' obligations is not
fulfilled in all material respects. Any such termination shall be without
liability of any party to any other party except that the provisions of Section
4(h) and Section 6 shall at all times be effective. If you elect to terminate
this Agreement as provided in this Section, the Company shall be notified
promptly by you by telephone or telegram, confirmed by letter.
10. Notices. All notices or communications hereunder shall be in writing
and, if sent to you, shall be mailed, delivered or telegraphed and confirmed to
you at your address set forth for that purpose in the Terms Agreement, or, if
sent to the Company shall be mailed, delivered or telegraphed and confirmed to
the Company at 388 Greenwich Street, New York, New York 10013, Attention:
Treasurer. Notices to any Underwriter pursuant to Section 6 hereof shall be
mailed, delivered or telegraphed and confirmed to such Underwriter's address
furnished to the Company in writing for the purpose of communications hereunder.
Any party to this Agreement may change such address for notices by sending to
the parties to this Agreement written notice of a new address for such purpose.
11. Parties. This Agreement shall inure to the benefit of and be binding
upon the Company and the Underwriters and their respective successors and the
controlling persons, officers and directors referred to in Section 6 hereof, and
no other person shall have any right or obligation hereunder.
In all dealings with the Company under this Agreement, you shall act on
behalf of each of the several Underwriters, and any action under this Agreement
taken by you or by any one of you designated in the Terms Agreement will be
binding upon all the Underwriters.
12. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
13. Counterparts. The Terms Agreement may be executed by one or more of
you and the Company in one or more
19
<PAGE>
counterparts, each of which shall constitute an original and all of which taken
together shall constitute one and the same Agreement.
20
<PAGE>
EXHIBIT I
TRAVELERS GROUP INC.
[Insert specific title of securities*]
DELAYED DELIVERY CONTRACT
[Insert date of initial public offering]*
TRAVELERS GROUP INC.
c/o*
Gentlemen:
The undersigned hereby agrees to purchase from Travelers Group Inc.
(hereinafter called the "Company"), and the Company agrees to sell to the
undersigned, [if one delayed closing, insert--as of the date hereof, for
delivery on _______, 19__ ("Delivery Date")] _____ shares of the Company's
[title of Securities] (the "Securities"), offered by the Company's Prospectus
relating thereto, receipt of a copy of which is hereby acknowledged, at a
purchase price of $........ per share, and on the further terms and conditions
set forth in this contract.
[If two or more delayed closings, insert the following:
The undersigned will purchase from the Company, as of the date hereof, for
delivery on the dates set forth below, the numbers of shares of Securities set
forth below:
Delivery Date Number of Shares
------------- ----------------
...........................
...........................
...........................
...........................
Each of such delivery dates is hereinafter referred to as a Delivery Date.]
Payment for the securities which the undersigned has agreed to purchase
for delivery on [the] [each] Delivery Date shall be made to the Company or its
order by wire transfer of same-day funds (or as otherwise specified in the Terms
- ------------
* To be completed when the Terms Agreement is executed by the parties
thereto.
21
<PAGE>
Agreement) at the office of ____ at ____ .M., ____ time, on such Delivery
Date upon delivery to the undersigned of the Securities to be purchased by
the undersigned for delivery on such Delivery Date in [definitive] form and
in such denominations and registered in such names as the undersigned may
designate by written or telegraphic communication addressed to the Company
not less than three full business days prior to such Delivery Date. If no
designation is received, the Securities will be registered in the name of the
undersigned and issued in the denomination equal to the number of shares of
Securities to be purchased by the undersigned on such Delivery Date.
The obligation of the undersigned to take delivery of, and make payment
for, Securities on [the] [each] Delivery Date shall be subject only to the
conditions that (1) investment in the Securities shall not at such Delivery Date
be prohibited under the laws of any jurisdiction in the United States to which
the undersigned is subject, which investment the undersigned represents is not
prohibited on the date hereof, and (2) the Company shall have delivered to the
Underwriters the number of shares of the [Firm] Securities to be purchased by
them pursuant to the Underwriting Agreement referred to in the Prospectus
mentioned above and received payment therefor.
Promptly after completion of the sale to the Underwriters, the Company
will mail or deliver to the undersigned at its address set forth below notice to
such effect, accompanied by a copy of the opinion of counsel for the Company
delivered to the Underwriters in connection therewith.
This contract will inure to the benefit of and be binding upon the parties
hereto and their respective successors, but will not be assignable by either
party hereto without the written consent of the other.
It is understood that the acceptance of this contract and any other
similar contracts is in the Company's sole discretion and, without limiting the
foregoing, need not be on a first-come, first-served basis. If this contract is
acceptable to the Company, it is requested that the Company sign the form of
acceptance below and mail or deliver one of the counterparts hereof to the
undersigned at its address set forth below. This will become a binding contract
between the Company and the undersigned when such counterpart is mailed or
delivered.
22
<PAGE>
This contract shall be governed by, and construed in accordance with, the
laws of the State of New York.
Very truly yours,
--------------------------------------
(Name of Purchaser)
By
--------------------------------------
--------------------------------------
(Title of Signatory)
--------------------------------------
--------------------------------------
(Address of Purchaser)
Accepted as of the above date.
TRAVELERS GROUP INC.
By
--------------------------------------
(Title of Signatory)
23
<PAGE>
EXHIBIT II
COMFORT LETTER PROVISIONS
(i) They are independent public accountants with respect to the
Company and its subsidiaries within the meaning of the Securities Act of 1933
and the regulations thereunder (the "Act and the Regulations"), and no
information concerning their relationship with or interest in the Company is
required by Item 10 of the Registration Statement.
(ii) In their opinion, the audited financial statements and
supporting schedule(s) examined by them and included or incorporated by
reference in the Registration Statement comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Regulations with respect to registration statements on Form S-3 and the
Securities Exchange Act of 1934, as amended, and the regulations thereunder (the
"Exchange Act and the Exchange Act Regulations").
(iii) They have: (i) performed specified procedures on the latest
incomplete unaudited consolidated financial statements, including a reading
thereof, (ii) performed the procedures specified by the American Institute of
Certified Public Accountants for a review of interim financial information as
described in SAS No. 71, "Interim Financial Information," or any successor
thereto on the unaudited condensed consolidated financial statements included or
incorporated by reference in the Registration Statement, (iii) read the minute
books of the Company through a specified date not more than three business
days prior to the date of such letter, inquired of officials of the Company
responsible for financial and accounting matters and made such other inquiries
and procedures as may be specified in such letter, and on the basis of such
inquiries and procedures nothing came to their attention that caused them
to believe that:
(A) the unaudited condensed consolidated financial statements,
if any, included or incorporated by reference in the Registration
Statement do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the Regulations and the
Exchange Act and Exchange Act Regulations or that any material
modifications should be made to the unaudited condensed consolidated
financial statements for them to be in conformity with generally accepted
accounting principles;
24
<PAGE>
(B) at a specified date not more than three business days
prior to the date of such letter, there was any change in common stock,
any decrease in total stockholder's equity or any change in the short-term
or long-term debt of the Company and its consolidated subsidiaries in each
case as compared with amounts included in the most recent consolidated
statement of financial position included or incorporated by reference in
the Registration Statement, except in each case for changes, increases or
decreases disclosed in such letter or in such Registration Statement; or
(C) for the period from the date of the most recent
consolidated statement of income included or incorporated by reference in
the Registration Statement to a specified date not more than three
business days prior to the date of such letter, there was any decrease,
as compared with the corresponding period in the preceding year, in total
revenue, income before taxes and minority interest, or net income except
in each case for increases or decreases disclosed in such letter or in
such Registration Statement.
(iv) In addition to the audit referred to in their report included
or incorporated by reference in the Registration Statement and the Prospectus,
they have carried out certain other specified procedures, not constituting an
audit, with respect to certain amounts, percentages and financial information
which are included or incorporated by reference in the Registration Statement
and the Prospectus and which are specified by the Underwriters, and have found
such amounts, percentages and financial information to be in agreement with the
relevant accounting, financial and other records of the Company and its
subsidiaries identified in such letter.
25
<PAGE>
Exhibit 4.3
CERTIFICATE OF TRUST
The undersigned, the trustees of Travelers Capital VI, desiring to
form a business trust pursuant to Delaware Business Trust Act, 12 Del. C. ss.
3810, hereby certify as follows:
1. The name of the business trust being formed hereby (the "Trust")
is "Travelers Capital VI."
2. The name and business address of the trustee of the Trust which
has its principal place of business in the State of Delaware is as follows:
Chase Manhattan Bank Delaware
1201 Market Street
Wilmington, Delaware 19801
3. This Certificate of Trust shall be effective as of the date of
filing.
Dated: May 14, 1997
/s/ Heidi G. Miller
-----------------------------------------
Name: Heidi G. Miller, as Regular Trustee
/s/ Irwin Ettinger
-----------------------------------------
Name: Irwin Ettinger, as Regular Trustee
CHASE MANHATTAN BANK DELAWARE,
as Trustee
By: /s/ John J. Cashin
-------------------------------------
Name: John J. Cashin
Title: Senior Trust Officer
<PAGE>
Exhibit 4.4
CERTIFICATE OF TRUST
The undersigned, the trustees of Travelers Capital VII, desiring to
form a business trust pursuant to Delaware Business Trust Act, 12 Del. C. ss.
3810, hereby certify as follows:
1. The name of the business trust being formed hereby (the "Trust")
is "Travelers Capital VII."
2. The name and business address of the trustee of the Trust which
has its principal place of business in the State of Delaware is as follows:
Chase Manhattan Bank Delaware
1201 Market Street
Wilmington, Delaware 19801
3. This Certificate of Trust shall be effective as of the date of
filing.
Dated: May 14, 1997
/s/ Heidi G. Miller
-----------------------------------------
Name: Heidi G. Miller, as Regular Trustee
/s/ Irwin Ettinger
-----------------------------------------
Name: Irwin Ettinger, as Regular Trustee
CHASE MANHATTAN BANK DELAWARE,
as Trustee
By: /s/ John J. Cashin
-------------------------------------
Name: John J. Cashin
Title: Senior Trust Officer
<PAGE>
Exhibit 4.7
========================
AMENDED AND RESTATED DECLARATION
OF TRUST
TRAVELERS Capital VI
Dated as of [ ], 199_
========================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.................................................... 1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application............................... 7
SECTION 2.2 Lists of Holders of Securities................................. 8
SECTION 2.3 Reports by the Institutional Trustee........................... 8
SECTION 2.4 Periodic Reports to Institutional Trustee...................... 8
SECTION 2.5 Evidence of Compliance with Conditions Precedent............... 9
SECTION 2.6 Events of Default; Waiver...................................... 9
SECTION 2.7 Event of Default; Notice....................................... 10
ARTICLE III
ORGANIZATION
SECTION 3.1 Name........................................................... 11
SECTION 3.2 Office......................................................... 11
SECTION 3.3 Purpose........................................................ 12
SECTION 3.4 Authority...................................................... 12
SECTION 3.5 Title to Property of the Trust................................. 12
SECTION 3.6 Powers and Duties of the Regular Trustees...................... 12
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees........... 15
SECTION 3.8 Powers and Duties of the Institutional Trustee................. 16
SECTION 3.9 Certain Duties and Responsibilities of the Institutional
Trustee........................................................ 18
SECTION 3.10 Certain Rights of Institutional Trustee........................ 20
SECTION 3.11 Delaware Trustee............................................... 22
SECTION 3.12 Execution of Documents......................................... 22
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities......... 22
SECTION 3.14 Duration of Trust.............................................. 22
SECTION 3.15 Mergers........................................................ 23
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities........................ 24
SECTION 4.2 Responsibilities of the Sponsor................................ 24
i
<PAGE>
Page
----
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees............................................. 25
SECTION 5.2 Delaware Trustee............................................... 26
SECTION 5.3 Institutional Trustee; Eligibility............................. 26
SECTION 5.4 Qualifications of Regular Trustees and Delaware Trustee
Generally...................................................... 27
SECTION 5.5 Initial Trustees; Additional Powers of Regular Trustees........ 27
SECTION 5.6 Appointment, Removal and Resignation of Trustees............... 28
SECTION 5.7 Vacancies among Trustees....................................... 29
SECTION 5.8 Effect of Vacancies............................................ 30
SECTION 5.9 Meetings....................................................... 30
SECTION 5.10 Delegation of Power............................................ 30
SECTION 5.11 Merger, Conversion, Consolidation or Succession to
Business....................................................... 31
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.................................................. 31
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities........................ 31
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust........................................... 32
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities......................................... 33
SECTION 9.2 Transfer of Certificates....................................... 34
SECTION 9.3 Deemed Security Holders........................................ 34
SECTION 9.4 Book Entry Interests........................................... 35
SECTION 9.5 Notices to Clearing Agency..................................... 35
SECTION 9.6 Appointment of Successor Clearing Agency....................... 36
ii
<PAGE>
Page
----
SECTION 9.7 Definitive Preferred Security Certificates..................... 36
SECTION 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.............. 37
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability...................................................... 37
SECTION 10.2 Exculpation.................................................... 38
SECTION 10.3 Fiduciary Duty................................................. 38
SECTION 10.4 Indemnification................................................ 39
SECTION 10.5 Outside Businesses............................................. 42
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.................................................... 42
SECTION 11.2 Certain Accounting Matters..................................... 42
SECTION 11.3 Banking........................................................ 43
SECTION 11.4 Withholding.................................................... 43
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments..................................................... 44
SECTION 12.2 Meetings of the Holders of Securities; Action by Written
Consent........................................................ 46
ARTICLE XIII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Institutional Trustee........ 47
SECTION 13.2 Representations and Warranties of Delaware Trustee............. 48
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices........................................................ 49
SECTION 14.2 Governing Law.................................................. 50
SECTION 14.3 Intention of the Parties....................................... 50
iii
<PAGE>
Page
----
SECTION 14.4 Headings....................................................... 50
SECTION 14.5 Successors and Assigns......................................... 50
SECTION 14.6 Partial Enforceability......................................... 51
SECTION 14.7 Counterparts................................................... 51
ANNEX I TERMS OF SECURITIES............................................I-1
EXHIBIT A-1 FORM OF PREFERRED SECURITY
CERTIFICATE...................................................A1-1
EXHIBIT A-2 FORM OF COMMON SECURITY CERTIFICATE...........................A2-1
EXHIBIT B SPECIMEN OF DEBENTURE..........................................B-1
EXHIBIT C UNDERWRITING AGREEMENT.........................................C-1
iv
<PAGE>
CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Declaration
- ------------------- -----------
310(a)............................................. 5.3(a)
310(c)............................................. Inapplicable
311(c)............................................. Inapplicable
312(a)............................................. 2.2(a)
312(b)............................................. 2.2(b)
313................................................ 2.3
314(a)............................................. 2.4
314(b)............................................. Inapplicable
314(c)............................................. 2.5
314(d)............................................. Inapplicable
314(f)............................................. Inapplicable
315(a)............................................. 3.9(b)
315(c)............................................. 3.9(a)
315(d)............................................. 3.9(a)
316(a)............................................. Annex I
316(c)............................................. 3.6(e)
- ----------
* This Cross-Reference Table does not constitute part of the Declaration and
shall not affect the interpretation of any of its terms or provisions.
v
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AMENDED AND RESTATED
DECLARATION OF TRUST
OF
TRAVELERS Capital VI
[ ], 199_
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated and effective as of , 199 , by the Trustees (as defined herein), the
Sponsor (as defined herein) and by the holders, from time to time, of undivided
beneficial interests in the Trust to be issued pursuant to this Declaration;
WHEREAS, the Trustees and the Sponsor established Travelers Capital
VI (the "Trust"), a trust under the Business Trust Act (as defined herein)
pursuant to a Declaration of Trust dated as of May 14, 1997, (the "Original
Declaration") and a Certificate of Trust filed with the Secretary of State of
the State of Delaware on May 14, 1997, for the sole purpose of issuing and
selling certain securities representing undivided beneficial interests in the
assets of the Trust and investing the proceeds thereof in certain Debentures of
the Debenture Issuer;
WHEREAS, as of the date hereof, no interests in the Trust have been
issued;
WHEREAS, all of the Trustees and the Sponsor, by this Declaration,
amend and restate each and every term and provision of the Original Declaration;
and
NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined in
the preamble above have the respective meanings assigned to them in
Section 1.1;
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(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections and
Annexes and Exhibits are to Articles and Sections of and Annexes and
Exhibits to this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Declaration unless otherwise defined in this Declaration
or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405
of the Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means any Person that is authorized
to bind such Person.
"Book Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 9.4.
"Business Day" means any day other than a Saturday, Sunday or a day
on which banking institutions in the City of New York, New York are permitted or
required by any applicable law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code ss.3801 et seq., as it may be amended from time to time, or
any successor legislation.
"Certificate" means a Common Security Certificate or a Preferred
Security Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as depositary
for the Preferred Securities and in whose name or in the name of a nominee of
that organization shall be registered a Global Certificate and which shall
undertake to effect book entry transfers and pledges of the Preferred
Securities.
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"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means [ ], 1997.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time, or any successor legislation.
"Commission" means the Securities and Exchange Commission.
"Common Security" has the meaning specified in Section 7.1.
"Common Security Certificate" means a definitive certificate in
fully registered form representing a Common Security substantially in the form
of Exhibit A-2.
"Company Indemnified Person" means (a) any Regular Trustee; (b) any
Affiliate of any Regular Trustee; (c) any officers, directors, shareholders,
members, partners, employees, representatives or agents of any Regular Trustee;
or (d) any officer, employee or agent of the Trust or its Affiliates.
"Corporate Trust Office" means the office of the Institutional
Trustee at which the corporate trust business of the Institutional Trustee
shall, at any particular time, be principally administered, which office at the
date of execution of this Declaration is located at 450 West 33rd Street, 15th
Floor, New York, New York 10001.
"Covered Person" means: (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means Travelers Group Inc. in its capacity as
issuer of the Debentures under the Indenture.
"Debenture Trustee" means The Chase Manhattan Bank, as trustee under
the Indenture until a successor is appointed thereunder, and thereafter means
such successor trustee.
"Debentures" means the series of Debentures to be issued by the
Debenture Issuer under the Indenture to be held by the Institutional Trustee, a
specimen certificate for such series of Debentures being Exhibit B.
"Definitive Preferred Security Certificates" has the meaning set
forth in Section 9.4.
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"Delaware Trustee" has the meaning set forth in Section 5.2.
"Distribution" has the meaning set forth in Section 6.1.
"DTC" means the Depository Trust Company, the initial Clearing
Agency.
"Event of Default" in respect of the Securities means an Event of
Default (as defined in the Indenture) has occurred and is continuing in respect
of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"Fiduciary Indemnified Person" has the meaning set forth in Section
10.4(b).
"Global Certificate" has the meaning set forth in Section 9.4.
"Holder" means a Person in whose name a Certificate representing a
Security is registered, such Person being a beneficial owner within the meaning
of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of October 7, 1996, between
the Debenture Issuer and the Debenture Trustee, pursuant to which the Debentures
are to be issued.
"Institutional Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 5.3.
"Institutional Trustee Account" has the meaning set forth in Section
3.8(c).
"Investment Company" means an investment company as defined in the
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940,
as amended from time to time, or any successor legislation.
"Investment Company Event" has the meaning set forth in Annex I
hereto.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Majority in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or by the Trust Indenture Act,
Holder(s) of outstanding Securities voting together as a single class or, as the
context may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities voting separately as a class,
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who are the record owners of an aggregate liquidation amount representing more
than 50% of the aggregate liquidation amount (including the stated amount that
would be paid on redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentages are determined) of
all outstanding Securities of the relevant class.
"Ministerial Action" has the meaning set forth in the terms of the
Securities as set forth in Annex I.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Paying Agent" has the meaning specified in Section 3.8(h).
"Payment Amount" has the meaning specified in Section 6.1.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Securities Guarantee" means the guarantee agreement dated
as of [ ], 199_, of the Sponsor in respect of the Preferred Securities.
"Preferred Security" has the meaning specified in Section 7.1.
"Preferred Security Beneficial Owner" means, with respect to a Book
Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of a
Person maintaining an account with such
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Clearing Agency (directly as a Clearing Agency Participant or as an indirect
participant, in each case in accordance with the rules of such Clearing Agency).
"Preferred Security Certificate" means a certificate representing a
Preferred Security substantially in the form of Exhibit A-1.
"Quorum" means a majority of the Regular Trustees or, if there are
only two Regular Trustees, both of them.
"Regular Trustee" has the meaning specified in Section 5.1.
"Related Party" means, with respect to the Sponsor, any direct or
indirect wholly owned subsidiary of the Sponsor or any other Person that owns,
directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"Responsible Officer" means, with respect to the Institutional
Trustee, any officer within the Corporate Trust Office of the Institutional
Trustee, including any vice-president, any assistant vice-president, any
assistant secretary, the treasurer, any assistant treasurer or other officer of
the Corporate Trust Office of the Institutional Trustee customarily performing
functions similar to those performed by any of the above designated officers and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's knowledge of
and familiarity with the particular subject.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act.
"Securities" means the Common Securities and the Preferred
Securities.
"Securities Act" means the Securities Act of 1933, as amended from
time to time, or any successor legislation.
"Special Event" has the meaning set forth in Annex I hereto.
"Sponsor" means Travelers Group Inc. or any successor entity in a
merger, consolidation or amalgamation, in its capacity as sponsor of the Trust.
"Successor Delaware Trustee" has the meaning set forth in Section
5.6.
"Successor Entity" has the meaning set forth in Section 3.15(b).
"Successor Institutional Trustee" has the meaning set forth in
Section 5.6.
"Successor Securities" has the meaning set forth in Section 3.15(b).
"Super Majority" has the meaning set forth in Section 2.6(a)(ii).
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"Travelers" means Travelers/Aetna Property Casualty Corp., a
Delaware corporation.
"Tax Event" has the meaning set forth in Annex I hereto.
"10% in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or by the Trust Indenture Act,
Holder(s) of outstanding Securities voting together as a single class or, as the
context may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities voting separately as a class, who are the record
owners of an aggregate liquidation amount representing 10% or more of the
aggregate liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"Underwriting Agreement" means the Underwriting Agreement for the
offering and sale of Preferred Securities in the form of Exhibit C.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and shall, to the
extent applicable, be governed by such provisions.
(b) The Institutional Trustee shall be the only Trustee that is a
Trustee for the purposes of the Trust Indenture Act.
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(c) If and to the extent that any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by ss.ss. 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide the Institutional Trustee (i) within 14 days after each
record date for payment of Distributions, a list, in such form as the
Institutional Trustee may reasonably require, of the names and addresses of the
Holders of the Securities ("List of Holders") as of such record date, provided
that neither the Sponsor nor the Regular Trustees on behalf of the Trust shall
be obligated to provide such List of Holders at any time the List of Holders
does not differ from the most recent List of Holders given to the Institutional
Trustee by the Sponsor and the Regular Trustees on behalf of the Trust, and (ii)
at any other time, within 30 days of receipt by the Trust of a written request
for a List of Holders as of a date no more than 14 days before such List of
Holders is given to the Institutional Trustee. The Institutional Trustee shall
preserve, in as current a form as is reasonably practicable, all information
contained in Lists of Holders given to it or which it receives in the capacity
as Paying Agent (if acting in such capacity) provided that the Institutional
Trustee may destroy any List of Holders previously given to it on receipt of a
new List of Holders.
(b) The Institutional Trustee shall comply with its obligations
under ss.ss. 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Institutional Trustee.
Within 60 days after April 15 of each year, the Institutional
Trustee shall provide to the Holders of the Preferred Securities such reports as
are required by ss. 313 of the Trust Indenture Act, if any, in the form and in
the manner provided by ss. 313 of the Trust Indenture Act. The Institutional
Trustee shall also comply with the requirements of ss. 313(d) of the Trust
Indenture Act.
SECTION 2.4 Periodic Reports to Institutional Trustee.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Institutional Trustee such documents, reports and
information as required by ss. 314 (if any) and the compliance certificate
required by ss. 314 of the Trust Indenture Act in the form, in the manner and at
the times required by ss. 314 of the Trust Indenture Act.
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SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Institutional Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Declaration that relate to
any of the matters set forth in ss. 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to ss.
314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default in respect of the Preferred
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, the Event of Default under
the Declaration shall also not be waivable; or
(ii) is waivable only with the consent of holders of more than a
majority in principal amount of the Debentures (a "Super Majority")
affected thereby, only the Holders of at least the proportion in aggregate
liquidation amount of the Preferred Securities that the relevant Super
Majority represents of the aggregate principal amount of the Debentures
outstanding may waive such Event of Default in respect of the Preferred
Securities under the Declaration.
The foregoing provisions of this Section 2.6(a) shall be in lieu of ss.
316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust
Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
default shall cease to exist, and any Event of Default with respect to the
Preferred Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other default or an Event of Default with respect to the Preferred
Securities or impair any right consequent thereon. Any waiver by the Holders of
the Preferred Securities of an Event of Default with respect to the Preferred
Securities shall also be deemed to constitute a waiver by the Holders of the
Common Securities of any such Event of Default with respect to the Common
Securities for all purposes of this Declaration without any further act, vote,
or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in liquidation amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
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(i) is not waivable under the Indenture, except where the Holders of
the Common Securities are deemed to have waived such Event of Default
under the Declaration as provided in this Section 2.6(b), the Event of
Default under the Declaration shall also not be waivable; or
(ii) is waivable only with the consent of a Super Majority, except
where the Holders of the Common Securities are deemed to have waived such
Event of Default under the Declaration as provided in this Section 2.6(b),
only the Holders of at least the proportion in aggregate liquidation
amount of the Common Securities that the relevant Super Majority
represents of the aggregate principal amount of the Debentures outstanding
may waive such Event of Default in respect of the Common Securities under
the Declaration;
provided further, each Holder of Common Securities will be deemed to have waived
any such Event of Default and all Events of Default with respect to the Common
Securities and its consequences until all Events of Default with respect to the
Preferred Securities have been cured, waived or otherwise eliminated, and until
such Events of Default with respect to the Preferred Securities have been so
cured, waived or otherwise eliminated, the Institutional Trustee will be deemed
to be acting solely on behalf of the Holders of the Preferred Securities and
only the Holders of the Preferred Securities will have the right to direct the
Institutional Trustee in accordance with the terms of the Securities. The
foregoing provisions of this Section 2.6(b) shall be in lieu of ss.ss.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such ss.ss.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly
excluded from this Declaration and the Securities, as permitted by the Trust
Indenture Act. Subject to the foregoing provisions of this Section 2.6(b), upon
the waiver of an Event of Default by the Holders of a Majority in liquidation
amount of the Common Securities, any such default shall cease to exist and any
Event of Default with respect to the Common Securities arising therefrom shall
be deemed to have been cured for every purpose of this Declaration, but no such
waiver shall extend to any subsequent or other default or Event of Default with
respect to the Common Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the
Institutional Trustee at the direction of the Holders of the Preferred
Securities, constitutes a waiver of the corresponding Event of Default under
this Declaration. The foregoing provisions of this Section 2.6(c) shall be in
lieu of ss. 316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of
the Trust Indenture Act is hereby expressly excluded from this Declaration and
the Securities, as permitted by the Trust Indenture Act.
SECTION 2.7 Event of Default; Notice.
(a) The Institutional Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders of the Securities, notices of (i) all defaults with
respect to the Securities actually known to a
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Responsible Officer of the Institutional Trustee, unless such defaults have been
cured before the giving of such notice (the term "defaults" for the purposes of
this Section 2.7(a) being hereby defined to be an Event of Default as defined in
the Indenture, not including any periods of grace provided for therein and
irrespective of the giving of any notice provided therein) and (ii) any notice
of default received from the Indenture Trustee with respect to the Debentures,
which notice from the Institutional Trustee to the Holders shall state that an
Event of Default under the Indenture also constitutes an Event of Default with
respect to the Securities; provided that, except for a default in the payment of
principal of (or premium, if any) or interest on any of the Debentures or in the
payment of any sinking fund installment established for the Debentures, the
Institutional Trustee shall be protected in withholding such notice if and so
long as a Responsible Officer of the Institutional Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders of the Securities.
(b) The Institutional Trustee shall not be deemed to have knowledge
of any default except:
(i) a default under Sections 5.1(1) and 5.1(2) of the Indenture; or
(ii) any default as to which the Institutional Trustee shall have
received written notice or of which a Responsible Officer of the
Institutional Trustee charged with the administration of the Declaration
shall have actual knowledge.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "Travelers Capital VI," as such name may be
modified from time to time by the Regular Trustees following written notice to
the Holders of Securities. The Trust's activities may be conducted under the
name of the Trust or any other name deemed advisable by the Regular Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o Travelers
Group Inc., 388 Greenwich Street, New York, New York 10013. On ten Business Days
written notice to the Holders of Securities, the Regular Trustees may designate
another principal office.
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SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to issue
and sell Securities and use the proceeds from such sale to acquire the
Debentures, and (b) except as otherwise limited herein, to engage in only those
other activities necessary, or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investments, pledge any of
its assets, or otherwise undertake (or permit to be undertaken) any activity
that would cause the Trust not to be classified for United States federal income
tax purposes as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration and to the
specific duties of the Institutional Trustee, the Regular Trustees shall have
exclusive and complete authority to carry out the purposes of the Trust. An
action taken by the Regular Trustees in accordance with their powers shall
constitute the act of and serve to bind the Trust and an action taken by the
Institutional Trustee on behalf of the Trust in accordance with its powers shall
constitute the act of and serve to bind the Trust. In dealing with the Trustees
acting on behalf of the Trust, no person shall be required to inquire into the
authority of the Trustees to bind the Trust. Persons dealing with the Trust are
entitled to rely conclusively on the power and authority of the Trustees as set
forth in this Declaration.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Debentures and
the Institutional Trustee Account or as otherwise provided in this Declaration,
legal title to all assets of the Trust shall be vested in the Trust. The Holders
shall not have legal title to any part of the assets of the Trust, but shall
have an undivided beneficial interest in the assets of the Trust.
SECTION 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:
(a) to issue and sell the Preferred Securities and the Common
Securities in accordance with this Declaration; provided, however, that
the Trust may issue no more than one series of Preferred Securities and no
more than one series of Common Securities, and, provided further, that
there shall be no interests in the Trust other than the Securities, and
the issuance of Securities shall be limited to a simultaneous issuance of
both Preferred Securities and Common Securities on the Closing Date;
(b) in connection with the issue and sale of the Preferred
Securities, at the direction of the Sponsor, to:
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(i) execute and file with the Commission on behalf of the
Trust a registration statement on Form S-3 or on another appropriate
form, or a registration statement under Rule 462(b) of the
Securities Act, in each case prepared by the Sponsor, including any
pre-effective or post-effective amendments thereto, relating to the
registration under the Securities Act of the Preferred Securities;
(ii) execute and file any documents prepared by the Sponsor,
or take any acts as determined by the Sponsor to be necessary in
order to qualify or register all or part of the Preferred Securities
in any State in which the Sponsor has determined to qualify or
register such Preferred Securities for sale;
(iii) execute and file an application, prepared by the
Sponsor, to the New York Stock Exchange, Inc., any other national
stock exchange or the Nasdaq National Market for listing upon notice
of issuance of any Preferred Securities;
(iv) execute and file with the Commission on behalf of the
Trust a registration statement on Form 8-A, prepared by the Sponsor,
including any pre-effective or post-effective amendments thereto,
relating to the registration of the Preferred Securities under
Section 12(b) of the Exchange Act; and
(v) deliver the Underwriting Agreement providing for the sale
of the Preferred Securities;
(c) to acquire the Debentures with the proceeds of the sale of the
Preferred Securities and the Common Securities; provided, however, that
the Regular Trustees shall cause legal title to the Debentures to be held
of record in the name of the Institutional Trustee for the benefit of the
Holders of the Preferred Securities and the Holders of Common Securities;
(d) to give the Sponsor and the Institutional Trustee prompt written
notice of the occurrence of a Special Event; provided that the Regular
Trustees shall consult with the Sponsor and the Institutional Trustee
before taking or refraining from taking any Ministerial Action in relation
to a Special Event;
(e) to establish a record date with respect to all actions to be
taken hereunder that require a record date be established, including and
with respect to, for the purposes of ss.316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue
relevant notices to the Holders of Preferred Securities and Holders of
Common Securities as to such actions and applicable record dates;
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(f) to take all actions and perform such duties as may be required
of the Regular Trustees pursuant to the terms of the Securities;
(g) to bring or defend, pay, collect, compromise, arbitrate, resort
to legal action, or otherwise adjust claims or demands of or against the
Trust ("Legal Action"), unless pursuant to Section 3.8(e), the
Institutional Trustee has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors,
and consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;
(j) to give the certificate required by ss. 314(a)(4) of the Trust
Indenture Act to the Institutional Trustee, which certificate may be
executed by any Regular Trustee;
(k) to incur expenses that are necessary or incidental to carry out
any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as, registrar and
transfer agent for the Securities;
(m) to give prompt written notice to the Holders of the Securities
of any notice received from the Debenture Issuer of its election to defer
payments of interest on the Debentures by extending the interest payment
period under the Indenture;
(n) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of
the State of Delaware and of each other jurisdiction in which such
existence is necessary to protect the limited liability of the Holders of
the Preferred Securities or to enable the Trust to effect the purposes for
which the Trust was created;
(o) to take any action, not inconsistent with this Declaration or
with applicable law, that the Regular Trustees determine in their
discretion to be necessary or desirable in carrying out the activities of
the Trust as set out in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an Investment
Company required to be registered under the Investment Company Act;
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(ii) causing the Trust to be classified for United States
federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture Issuer
for United States federal income tax purposes,
provided that such action does not adversely affect the interests of
Holders;
(p) to take all action necessary to cause all applicable tax returns
and tax information reports that are required to be filed with respect to
the Trust to be duly prepared and filed by the Regular Trustees, on behalf
of the Trust; and
(q) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing.
The Regular Trustees must exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Regular Trustees shall not take any
action that is inconsistent with the purposes and functions of the Trust set
forth in Section 3.3.
Subject to this Section 3.6, the Regular Trustees shall have none of
the powers or the authority of the Institutional Trustee set forth in Section
3.8.
Any expenses incurred by the Regular Trustees pursuant to this
Section 3.6 shall be reimbursed by the Debenture Issuer.
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.
(a) The Trust shall not, and the Trustees (including the
Institutional Trustee) shall not, engage in any activity other than as required
or authorized by this Declaration. In particular, the Trust shall not and the
Trustees (including the Institutional Trustee) shall cause the Trust not to:
(i) invest any proceeds received by the Trust from holding the
Debentures, but shall promptly distribute all such proceeds to Holders of
Securities pursuant to the terms of this Declaration and of the
Securities;
(ii) acquire any assets other than as expressly provided herein;
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness;
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(v) possess any power or otherwise act in such a way as to vary the
Trust assets or the terms of the Securities in any way whatsoever;
(vi) issue any securities or other evidences of beneficial ownership
of, or beneficial interest in, the Trust other than the Securities; or
(vii) other than as provided in this Declaration or Annex I, (A)
direct the time, method and place of exercising any trust or power conferred
upon the Debenture Trustee with respect to the Debentures, (B) waive any past
default that is waivable under the Indenture, (C) exercise any right to rescind
or annul any declaration that the principal of all the Debentures shall be due
and payable, or (D) consent to any amendment, modification or termination of the
Indenture or the Debentures where such consent shall be required unless the
Trust shall have obtained an opinion of nationally recognized independent tax
counsel experienced in such matters to the effect that as a result of such
action, the Trust will not fail to be classified as a grantor trust for United
States federal income tax purposes.
SECTION 3.8 Powers and Duties of the Institutional Trustee.
(a) The legal title to the Debentures shall be owned by and held of
record in the name of the Institutional Trustee in trust for the benefit of the
Holders of the Securities. The right, title and interest of the Institutional
Trustee to the Debentures shall vest automatically in each Person who may
hereafter be appointed as Institutional Trustee in accordance with Section 5.6.
Such vesting and cessation of title shall be effective whether or not
conveyancing documents with regard to the Debentures have been executed and
delivered.
(b) The Institutional Trustee shall not transfer its right, title
and interest in the Debentures to the Regular Trustees or to the Delaware
Trustee (if the Institutional Trustee does not also act as Delaware Trustee).
(c) The Institutional Trustee shall:
(i) establish and maintain a segregated non-interest bearing trust
account (the "Institutional Trustee Account") in the name of and under the
exclusive control of the Institutional Trustee on behalf of the Holders of
the Securities and, upon the receipt of payments of funds made in respect
of the Debentures held by the Institutional Trustee, deposit such funds
into the Institutional Trustee Account and make payments to the Holders of
the Preferred Securities and Holders of the Common Securities from the
Institutional Trustee Account in accordance with Section 6.1. Funds in the
Institutional Trustee Account shall be held uninvested until disbursed in
accordance with this Declaration. The Institutional Trustee Account shall
be an account that is maintained with a banking institution the rating on
whose long-term unsecured indebtedness assigned by a "nationally
recognized statistical rating organization," as that term is defined for
purposes of Rule 436(g)(2) under the
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Securities Act, is at least equal to the rating assigned to the Preferred
Securities by a nationally recognized statistical rating organization;
(ii) engage in such ministerial activities as shall be necessary or
appropriate to effect the redemption of the Preferred Securities and the
Common Securities to the extent the Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued by the Regular
Trustees in accordance with the terms of the Securities, engage in such
ministerial activities as shall be necessary or appropriate to effect the
distribution of the Debentures to Holders of Securities upon the
occurrence of certain Special Events or other specified circumstances
pursuant to the terms of the Securities.
(d) The Institutional Trustee shall take all actions and perform
such duties as may be specifically required of the Institutional Trustee
pursuant to the terms of the Securities.
(e) Subject to Section 2.6, the Institutional Trustee shall take any
Legal Action which arises out of or in connection with an Event of Default of
which a Responsible Officer of the Institutional Trustee has actual knowledge or
the Institutional Trustee's duties and obligations under this Declaration or the
Trust Indenture Act.
(f) The Institutional Trustee shall not resign as a Trustee unless
either:
(i) the Trust has been completely liquidated and the proceeds of the
liquidation distributed to the Holders of Securities pursuant to the terms
of the Securities; or
(ii) a Successor Institutional Trustee has been appointed and has
accepted that appointment in accordance with Section 5.6.
(g) The Institutional Trustee shall have the legal power to exercise
all of the rights, powers and privileges of a holder of Debentures under the
Indenture and, if an Event of Default actually known to a Responsible Officer of
the Institutional Trustee occurs and is continuing, the Institutional Trustee
shall, for the benefit of Holders of the Securities, enforce its rights as
holder of the Debentures subject to the rights of the Holders pursuant to the
terms of such Securities, this Declaration, the Business Trust Act and the Trust
Indenture Act.
(h) The Institutional Trustee may authorize one or more Persons
(each, a "Paying Agent") to pay Distributions, redemption payments or
liquidation payments on behalf of the Trust with respect to all securities and
any such Paying Agent shall comply with ss. 317(b) of the Trust Indenture Act.
Any Paying Agent may be removed by the
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Institutional Trustee at any time and a successor Paying Agent or additional
Paying Agents may be appointed at any time by the Institutional Trustee.
(i) Subject to this Section 3.8, the Institutional Trustee shall
have none of the duties, liabilities, powers or the authority of the Regular
Trustees set forth in Section 3.6.
The Institutional Trustee must exercise the powers set forth in this
Section 3.8 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Institutional Trustee shall not take
any action that is inconsistent with the purposes and functions of the Trust set
out in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the Institutional Trustee.
(a) The Institutional Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Declaration and no implied covenants shall be read into this Declaration
against the Institutional Trustee. In case an Event of Default has occurred
(that has not been cured or waived pursuant to Section 2.6) of which a
Responsible Officer of the Institutional Trustee has actual knowledge, the
Institutional Trustee shall exercise such of the rights and powers vested in it
by this Declaration, and use the same degree of care and skill in the exercise
of such rights and powers, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(b) No provision of this Declaration shall be construed to relieve
the Institutional Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Institutional Trustee
shall be determined solely by the express provisions of this
Declaration and the Institutional Trustee shall not be liable except
for the performance of such duties and obligations as are
specifically set forth in this Declaration, and no implied covenants
or obligations shall be read into this Declaration against the
Institutional Trustee; and
(B) in the absence of bad faith on the part of the
Institutional Trustee, the Institutional 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 Institutional Trustee and conforming to the
requirements of this Declaration; but in the case of any such
certificates or
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opinions that by any provision hereof are specifically required to
be furnished to the Institutional Trustee, the Institutional Trustee
shall be under a duty to examine the same to determine whether or
not they conform to the requirements of this Declaration;
(ii) the Institutional Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Institutional
Trustee, unless it shall be proved that the Institutional Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Institutional Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in
liquidation amount of the Securities relating to the time, method and
place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under this Declaration;
(iv) no provision of this Declaration shall require the
Institutional Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or in
the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Declaration or indemnity
reasonably satisfactory to the Institutional Trustee against such risk or
liability is not reasonably assured to it;
(v) the Institutional Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Debentures and the
Institutional Trustee Account shall be to deal with such property in a
similar manner as the Institutional Trustee deals with similar property
for its own account, subject to the protections and limitations on
liability afforded to the Institutional Trustee under this Declaration and
the Trust Indenture Act;
(vi) the Institutional Trustee shall have no duty or liability for
or with respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments levied thereon or in
connection therewith;
(vii) the Institutional Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree with the
Sponsor. Money held by the Institutional Trustee need not be segregated
from other funds held by it except in relation to the Institutional
Trustee Account maintained by the Institutional Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required by law; and
(viii) the Institutional Trustee shall not be responsible for
monitoring the compliance by the Regular Trustees or the Sponsor with
their respective duties under
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this Declaration, nor shall the Institutional Trustee be liable for any
default or misconduct of the Regular Trustees or the Sponsor.
SECTION 3.10 Certain Rights of Institutional Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Institutional 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, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and
to have been signed, sent or presented by the proper party or parties;
(ii) any direction or act of the Sponsor or the Regular Trustees
contemplated by this Declaration shall be sufficiently evidenced by an
Officers' Certificate;
(iii) whenever in the administration of this Declaration, the
Institutional Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder, the
Institutional 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 Sponsor or the Regular
Trustees;
(iv) the Institutional Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or securities
laws) or any rerecording, refiling or registration thereof;
(v) the Institutional Trustee may consult with counsel or other
experts and the advice or opinion of such counsel and experts with respect
to legal matters or advice within the scope of such experts' area of
expertise shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good
faith and in accordance with such advice or opinion, such counsel may be
counsel to the Sponsor or any of its Affiliates, and may include any of
its employees. The Institutional Trustee shall have the right at any time
to seek instructions concerning the administration of this Declaration
from any court of competent jurisdiction;
(vi) the Institutional Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration at
the request or direction of any Holder, unless such Holder shall have
provided to the Institutional Trustee security and indemnity, reasonably
satisfactory to the Institutional Trustee, against the
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costs, expenses (including attorneys' fees and expenses and the expenses
of the Institutional Trustee's agents, nominees or custodians) and
liabilities that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by the
Institutional Trustee provided, that, nothing contained in this Section
3.10(a)(vi) shall be taken to relieve the Institutional Trustee, upon the
occurrence of an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Declaration;
(vii) the Institutional Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Institutional Trustee, in
its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit;
(viii) the Institutional Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents, custodians, nominees or attorneys and the Institutional
Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder;
(ix) any action taken by the Institutional Trustee or its agents
hereunder shall bind the Trust and the Holders of the Securities, and the
signature of the Institutional Trustee or its agents alone shall be
sufficient and effective to perform any such action and no third party
shall be required to inquire as to the authority of the Institutional
Trustee to so act or as to its compliance with any of the terms and
provisions of this Declaration, both of which shall be conclusively
evidenced by the Institutional Trustee's or its agent's taking such
action;
(x) whenever in the administration of this Declaration the
Institutional Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action
hereunder, the Institutional Trustee (i) may request instructions from the
Holders of the Securities which instructions may only be given by the
Holders of the same proportion in liquidation amount of the Securities as
would be entitled to direct the Institutional Trustee under the terms of
the Securities in respect of such remedy, right or action, (ii) may
refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be protected in
conclusively relying on or acting in or accordance with such instructions;
and
(xi) except as otherwise expressly provided by this Declaration, the
Institutional Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Declaration.
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(b) No provision of this Declaration shall be deemed to impose any
duty or obligation on the Institutional Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Institutional Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Institutional
Trustee shall be construed to be a duty.
SECTION 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other than
Section 5.2, the Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities of
the Regular Trustees or the Institutional Trustee described in this Declaration.
Except as set forth in Section 5.2, the Delaware Trustee shall be a Trustee for
the sole and limited purpose of fulfilling the requirements of ss. 3807 of the
Business Trust Act.
SECTION 3.12 Execution of Documents.
Unless otherwise determined by the Regular Trustees, and except as
otherwise required by the Business Trust Act, a majority of or, if there are
only two, any Regular Trustee or, if there is only one, such Regular Trustee is
authorized to execute on behalf of the Trust any documents that the Regular
Trustees have the power and authority to execute pursuant to Section 3.6;
provided that, the registration statement referred to in Section 3.6(b)(i),
including any amendments thereto, shall be signed by all of the Regular
Trustees.
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities shall
be taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.
SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of Article
VIII hereof, shall have existence for fifty-five (55) years from the Closing
Date.
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SECTION 3.15 Mergers.
(a) The Trust may not consolidate, amalgamate, merge with or into,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except as
described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of the Regular Trustees or, if
there are more than two, a majority of the Regular Trustees and without the
consent of the Holders of the Securities, the Delaware Trustee or the
Institutional Trustee, consolidate, amalgamate, merge with or into, or be
replaced by a trust organized as such under the laws of any State; provided
that:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the Trust
under the Securities; or
(B) substitutes for the Securities other securities having
substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the
same as the Preferred Securities rank with respect to Distributions
and payments upon liquidation, redemption and otherwise;
(ii) the Debenture Issuer expressly acknowledges a trustee of the
Successor Entity that possesses the same powers and duties as the
Institutional Trustee as the Holder of the Debentures;
(iii) the Preferred Securities or any Successor Securities are
listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or with any other
organization on which the Preferred Securities are then listed or quoted;
(iv) such merger, consolidation, amalgamation or replacement does
not cause the Preferred Securities (including any Successor Securities) to
be downgraded by any nationally recognized statistical rating
organization;
(v) such merger, consolidation, amalgamation or replacement does not
adversely affect the rights, preferences and privileges of the Holders of
the Securities (including any Successor Securities) in any material
respect (other than with respect to any dilution of such Holders'
interests in the new entity as a result of such merger, consolidation,
amalgamation or replacement);
(vi) such Successor Entity has a purpose identical to that of the
Trust;
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(vii) prior to such merger, consolidation, amalgamation or
replacement, the Trust has received an opinion of a nationally recognized
independent counsel to the Trust experienced in such matters to the effect
that:
(A) such merger, consolidation, amalgamation or replacement
does not adversely affect the rights, preferences and privileges of
the Holders of the Securities (including any Successor Securities)
in any material respect (other than with respect to any dilution of
the Holders' interest in the new entity); and
(B) following such merger, consolidation, amalgamation or
replacement, neither the Trust nor the Successor Entity will be
required to register as an Investment Company;
(C) following such merger, consolidation, amalgamation or
replacement, the Trust (or the Successor Entity) will continue to be
classified as a grantor trust for United States federal income tax
purposes; and
(viii) the Sponsor guarantees the obligations of such Successor
Entity under the Successor Securities at least to the extent provided by
the Preferred Securities Guarantee.
(c) Notwithstanding Section 3.15(b), the Trust shall not, without
the consent of Holders of 100% in liquidation amount of the Securities,
consolidate, amalgamate, merge with or into, or be replaced by any other entity
or permit any other entity to consolidate, amalgamate, merge with or into, or
replace it, if in the opinion of a nationally recognized independent tax counsel
experienced in such matters, such consolidation, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as other
than a grantor trust for United States federal income tax purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
On the Closing Date, the Sponsor will purchase all of the Common
Securities issued by the Trust in an amount equal to 3% or more of the capital
of the Trust, at the same time as the Preferred Securities are sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Preferred Securities,
the Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
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(a) to prepare for filing by the Trust with the Commission a
registration statement on Form S-3 or on another appropriate form, or a
registration statement under Rule 462(b) of the Securities Act, including
any pre-effective or post-effective amendments thereto, relating to the
registration under the Securities Act of the Preferred Securities;
(b) to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Preferred Securities and
to do any and all such acts, other than actions which must be taken by the
Trust, and advise the Trust of actions it must take, and prepare for
execution and filing any documents to be executed and filed by the Trust,
as the Sponsor deems necessary or advisable in order to comply with the
applicable laws of any such States;
(c) to prepare for filing by the Trust an application to the New
York Stock Exchange, any other national stock exchange or the Nasdaq
National Market for listing upon notice of issuance of any Preferred
Securities;
(d) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A, including any pre-effective or
post-effective amendments thereto, relating to the registration of the
Preferred Securities under Section 12(b) of the Exchange Act, including
any amendments thereto; and
(e) to negotiate the terms of the Underwriting Agreement providing
for the sale of the Preferred Securities.
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees.
The number of Trustees initially shall be four (4), and:
(a) at any time before the issuance of any Securities, the Sponsor
may, by written instrument, increase or decrease the number of Trustees;
and
(b) after the issuance of any Securities, the number of Trustees may
be increased or decreased by vote of the Holders of a majority in
liquidation amount of the Common Securities voting as a class at a meeting
of the Holders of the Common Securities,
provided, however, that, the number of Trustees shall in no event be less than
two (2); provided further that (1) one Trustee, in the case of a natural person,
shall be a person who
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is a resident of the State of Delaware or that, if not a natural person, shall
be an entity which has its principal place of business in the State of Delaware
(the "Delaware Trustee"); (2) there shall be at least one Trustee who is an
employee or officer of, or is affiliated with the Sponsor (a "Regular Trustee");
and (3) one Trustee shall be the Institutional Trustee for so long as this
Declaration is required to qualify as an indenture under the Trust Indenture
Act, and such Trustee may also serve as Delaware Trustee if it meets the
applicable requirements.
SECTION 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place
of business in the State of Delaware, and otherwise meets the requirements
of applicable law,
provided that, if the Institutional Trustee has its principal place of business
in the State of Delaware and otherwise meets the requirements of applicable law,
then the Institutional Trustee shall also be the Delaware Trustee and Section
3.11 shall have no application.
SECTION 5.3 Institutional Trustee; Eligibility.
(a) There shall at all times be one Trustee that shall act as
Institutional Trustee which shall:
(i) not be an Affiliate of the Sponsor;
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Commission to act as an institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust powers, having
a combined capital and surplus of at least 50 million U.S. dollars
($50,000,000), and subject to supervision or examination by Federal,
State, Territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law or to
the requirements of the supervising or examining authority referred to
above, then for the purposes of this Section 5.3(a)(ii), the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published; and
(iii) if the Trust is excluded from the definition of an Investment
Company solely by means of Rule 3a-7 and to the extent Rule 3a-7 requires
a trustee having
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certain qualifications to hold title to the "eligible assets" of the
Trust, the Institutional Trustee shall possess those qualifications.
(b) If at any time the Institutional Trustee shall cease to be
eligible to so act under Section 5.3(a), the Institutional Trustee shall
immediately resign in the manner and with the effect set forth in Section
5.6(c).
(c) If the Institutional Trustee has or shall acquire any
"conflicting interest" within the meaning of ss. 310(b) of the Trust Indenture
Act, the Institutional Trustee and the Holders of the Common Securities (as if
such Holders were the obligor referred to in ss. 310(b) of the Trust Indenture
Act) shall in all respects comply with the provisions of ss. 310(b) of the Trust
Indenture Act.
(d) The Preferred Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause (i) of the
first provision contained in Section 310(b) of the Trust Indenture Act.
(e) The initial Institutional Trustee shall be as set forth in
Section 5.5 hereof.
SECTION 5.4 Qualifications of Regular Trustees and Delaware Trustee Generally.
Each Regular Trustee and the Delaware Trustee (unless the
Institutional Trustee also acts as Delaware Trustee) shall be either a natural
person who is at least 21 years of age or a legal entity that shall act through
one or more Authorized Officers.
SECTION 5.5 Initial Trustees; Additional Powers of Regular Trustees.
(a) The initial Regular Trustees shall be:
Heidi G. Miller
Irwin Ettinger
The initial Delaware Trustee shall be:
Chase Manhattan Bank Delaware
1201 Market Street
Wilmington, Delaware 19801
The initial Institutional Trustee shall be:
The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, New York 10001
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(b) Except as expressly set forth in this Declaration and except if
a meeting of the Regular Trustees is called with respect to any matter over
which the Regular Trustees have power to act, any power of the Regular Trustees
may be exercised by, or with the consent of, any one such Regular Trustee.
(c) Unless otherwise determined by the Regular Trustees, and except
as otherwise required by the Business Trust Act or applicable law, any Regular
Trustee is authorized to execute on behalf of the Trust any documents which the
Regular Trustees have the power and authority to cause the Trust to execute
pursuant to Section 3.6, provided, that, the registration statement referred to
in Section 3.6, including any amendments thereto, shall be signed by all of the
Regular Trustees; and
(d) a Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purposes of signing any documents which the Regular Trustees
have power and authority to cause the Trust to execute pursuant to Section 3.6.
SECTION 5.6 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 5.6(b), Trustees may be appointed or removed
without cause at any time:
(i) until the issuance of any Securities, by written instrument
executed by the Sponsor; and
(ii) after the issuance of any Securities, by vote of the Holders of
a Majority in liquidation amount of the Common Securities voting as a
class at a meeting of the Holders of the Common Securities.
(b)(i) The Trustee that acts as Institutional Trustee shall not be
removed in accordance with Section 5.6(a) until a successor Trustee possessing
the qualifications to act as Institutional Trustee under Section 5.3 (a
"Successor Institutional Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Institutional
Trustee and delivered to the Regular Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall not be removed
in accordance with Section 5.6(a) until a successor Trustee possessing the
qualifications to act as Delaware Trustee under Sections 5.2 and 5.4 (a
"Successor Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Delaware
Trustee and delivered to the Regular Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until his
successor shall have been appointed or until his death, removal or resignation.
Any Trustee may
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resign from office (without need for prior or subsequent accounting) by an
instrument in writing signed by the Trustee and delivered to the Sponsor and the
Trust, which resignation shall take effect upon such delivery or upon such later
date as is specified therein; provided, however, that:
(i) No such resignation of the Trustee that acts as the
Institutional Trustee shall be effective:
(A) until a Successor Institutional Trustee has been appointed
and has accepted such appointment by instrument executed by such
Successor Institutional Trustee and delivered to the Trust, the
Sponsor and the resigning Institutional Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the holders of
the Securities; and
(ii) no such resignation of the Trustee that acts as the Delaware
Trustee shall be effective until a Successor Delaware Trustee has been
appointed and has accepted such appointment by instrument executed by such
Successor Delaware Trustee and delivered to the Trust, the Sponsor and the
resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best
efforts to promptly appoint a Successor Delaware Trustee or Successor
Institutional Trustee as the case may be if the Institutional Trustee or the
Delaware Trustee delivers an instrument of resignation in accordance with this
Section 5.6.
(e) If no Successor Institutional Trustee or Successor Delaware
Trustee shall have been appointed and accepted appointment as provided in this
Section 5.6 within 60 days after delivery to the Sponsor and the Trust of an
instrument of resignation, the resigning Institutional Trustee or Delaware
Trustee, as applicable, may petition any court of competent jurisdiction for
appointment of a Successor Institutional Trustee or Successor Delaware Trustee.
Such court may thereupon, after prescribing such notice, if any, as it may deem
proper and prescribe, appoint a Successor Institutional Trustee or Successor
Delaware Trustee, as the case may be.
(f) No Institutional Trustee or Delaware Trustee shall be liable for
the acts or omissions to act of any Successor Institutional Trustee or Successor
Delaware Trustee, as the case may be.
SECTION 5.7 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 5.1, or if the number of Trustees is
increased pursuant to Section 5.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by
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the Regular Trustees or, if there are more than two, a majority of the Regular
Trustees shall be conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance with Section 5.6.
SECTION 5.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to annul the Trust. Whenever a vacancy in the number
of Regular Trustees shall occur, until such vacancy is filled by the appointment
of a Regular Trustee in accordance with Section 5.6, the Regular Trustees in
office, regardless of their number, shall have all the powers granted to the
Regular Trustees and shall discharge all the duties imposed upon the Regular
Trustees by this Declaration.
SECTION 5.9 Meetings.
If there is more than one Regular Trustee, meetings of the Regular
Trustees shall be held from time to time upon the call of any Regular Trustee.
Regular meetings of the Regular Trustees may be held at a time and place fixed
by resolution of the Regular Trustees. Notice of any in-person meetings of the
Regular Trustees shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than 48
hours before such meeting. Notice of any telephonic meetings of the Regular
Trustees or any committee thereof shall be hand delivered or otherwise delivered
in writing (including by facsimile, with a hard copy by overnight courier) not
less than 24 hours before a meeting. Notices shall contain a brief statement of
the time, place and anticipated purposes of the meeting. The presence (whether
in person or by telephone) of a Regular Trustee at a meeting shall constitute a
waiver of notice of such meeting except where a Regular Trustee attends a
meeting for the express purpose of objecting to the transaction of any activity
on the ground that the meeting has not been lawfully called or convened. Unless
provided otherwise in this Declaration, any action of the Regular Trustees may
be taken at a meeting by vote of a majority of the Regular Trustees present
(whether in person or by telephone) and eligible to vote with respect to such
matter, provided that a Quorum is present, or without a meeting by the unanimous
written consent of the Regular Trustees. In the event there is only one Regular
Trustee, any and all action of such Regular Trustee shall be evidenced by a
written consent of such Regular Trustee.
SECTION 5.10 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any documents contemplated in Section
3.6, including any registration statement or amendment thereto filed with the
Commission, or making any other governmental filing; and
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(b) the Regular Trustees shall have power to delegate from time to
time to such of their number or to officers of the Trust the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Regular Trustees or otherwise as the Regular Trustees may deem
expedient, to the extent such delegation is not prohibited by applicable law or
contrary to the provisions of the Trust, as set forth herein.
SECTION 5.11 Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Institutional Trustee or the Delaware
Trustee, as the case may be, may be merged or converted or with which either may
be consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Institutional Trustee or the Delaware Trustee, as the
case may be, shall be a party, or any corporation succeeding to all or
substantially all the corporate trust business of the Institutional Trustee or
the Delaware Trustee, as the case may be, shall be the successor of the
Institutional Trustee or the Delaware Trustee, as the case may be, hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions (as defined herein) in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Preferred Securities and the Common
Securities in accordance with the preferences set forth in their respective
terms. If and to the extent that the Debenture Issuer makes a payment of
interest (including Compounded Interest (as defined in the Indenture) and
Additional Interest (as defined in the Indenture)), premium and/or principal on
the Debentures held by the Institutional Trustee (the amount of any such payment
being a "Payment Amount"), the Institutional Trustee shall and is directed to
make a distribution (a "Distribution") of the Payment Amount to Holders.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Regular Trustees shall on behalf of the Trust issue one
class of preferred securities representing undivided beneficial interests in the
assets of the Trust having such terms as are set forth in Annex I (the
"Preferred Securities") and one class of common securities representing
undivided beneficial interests in the assets of the Trust
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having such terms as are set forth in Annex I (the "Common Securities"). The
Trust shall issue no securities or other interests in the assets of the Trust
other than the Preferred Securities and the Common Securities.
(b) The Certificates shall be signed on behalf of the Trust by a
Regular Trustee. Such signature shall be the manual or facsimile signature of
any present or any future Regular Trustee. In case any Regular Trustee of the
Trust who shall have signed any of the Securities shall cease to be such Regular
Trustee before the Certificates so signed shall be delivered by the Trust, such
Certificates nevertheless may be delivered as though the person who signed such
Certificates had not ceased to be such Regular Trustee; and any Certificate may
be signed on behalf of the Trust by such persons who, at the actual date of
execution of such Security, shall be the Regular Trustees of the Trust, although
at the date of the execution and delivery of the Declaration any such person was
not such a Regular Trustee. Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Regular Trustees, as evidenced by their execution thereof, and may have such
letters, numbers or other marks of identification or designation and such
legends or endorsements as the Regular Trustees may deem appropriate, or as may
be required to comply with any law or with any rule or regulation of any stock
exchange on which Securities may be listed, or to conform to usage.
(c) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(d) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable.
(e) Every Person, by virtue of having become a Holder or a Preferred
Security Beneficial Owner in accordance with the terms of this Declaration,
shall be deemed to have expressly assented and agreed to the terms of, and shall
be bound by, this Declaration.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.
(a) The Trust shall terminate:
(i) upon the bankruptcy of any Holder of the Common Securities or
the Sponsor;
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(ii) upon the filing of a certificate of dissolution or its
equivalent with respect to any Holder of the Common Securities or the
Sponsor; the filing of a certificate of cancellation with respect to the
Trust or the revocation of the Holder of the Common Securities or the
Sponsor's charter and the expiration of 90 days after the date of
revocation without a reinstatement thereof;
(iii) upon the entry of a decree of judicial dissolution of any
Holder of the Common Securities, the Sponsor or the Trust;
(iv) when all of the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall have
been paid to the Holders in accordance with the terms of the Securities;
(v) upon the occurrence and continuation of a Special Event pursuant
to which the Trust shall have been dissolved in accordance with the terms
of the Securities and all of the Debentures endorsed thereon shall have
been distributed to the Holders of Securities in exchange for all of the
Securities;
(vi) before the issuance of any Securities, with the consent of all
of the Regular Trustees and the Sponsor; or
(vii) upon the expiration of the term of the Trust set forth in
Section 3.14;
provided, that so long as any Preferred Securities are outstanding and are not
held entirely by Travelers, the Trust may not voluntarily liquidate, dissolve,
wind-up or terminate except in connection with the occurrence of a Special
Event.
(b) As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a), the Trustees shall file a certificate of
cancellation with the Secretary of State of the State of Delaware.
(c) The provisions of Section 3.9 and Article X shall survive the
termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Declaration and in
the terms of the Securities. Any transfer or purported transfer of any Security
not made in accordance with this Declaration shall be null and void.
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(b) Subject to this Article IX, Preferred Securities shall be freely
transferable.
(c) Subject to this Article IX, the Sponsor and any Related Party
may only transfer Common Securities to the Sponsor or a Related Party of the
Sponsor; provided that, any such transfer is subject to the condition precedent
that the transferor obtain the written opinion of nationally recognized
independent counsel experienced in such matters that such transfer would not
cause more than an insubstantial risk that:
(i) the Trust would not be classified for United States federal
income tax purposes as a grantor trust; and
(ii) the Trust would be an Investment Company or the transferee
would become an Investment Company.
SECTION 9.2 Transfer of Certificates.
The Regular Trustees shall provide for the registration of
Certificates and of transfers of Certificates, which will be effected without
charge but only upon payment (with such indemnity as the Regular Trustees may
require) in respect of any tax or other government charges that may be imposed
in relation to it. Upon surrender for registration of transfer of any
Certificate, the Regular Trustees shall cause one or more new Certificates to be
issued in the name of the designated transferee or transferees. Every
Certificate surrendered for registration of transfer shall be accompanied by a
written instrument of transfer in form satisfactory to the Regular Trustees duly
executed by the Holder or such Holder's attorney duly authorized in writing.
Each Certificate surrendered for registration of transfer shall be canceled by
the Regular Trustees. A transferee of a Certificate shall be entitled to the
rights and subject to the obligations of a Holder hereunder upon the receipt by
such transferee of a Certificate. By acceptance of a Certificate, each
transferee shall be deemed to have agreed to be bound by this Declaration.
SECTION 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any Certificate
shall be registered on the books and records of the Trust as the sole holder of
such Certificate and of the Securities represented by such Certificate for
purposes of receiving Distributions and for all other purposes whatsoever and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Certificate or in the Securities represented by such
Certificate on the part of any Person, whether or not the Trust shall have
actual or other notice thereof.
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SECTION 9.4 Book Entry Interests.
Unless otherwise specified in the terms of the Preferred Securities,
the Preferred Securities Certificates, on original issuance, will be issued in
the form of one or more, fully registered, global Preferred Security
Certificates (each a "Global Certificate"), to be delivered to DTC, the initial
Clearing Agency, by, or on behalf of, the Trust. Such Global Certificates shall
initially be registered on the books and records of the Trust in the name of
Cede & Co., the nominee of DTC, and no Preferred Security Beneficial Owner will
receive a definitive Preferred Security Certificate representing such Preferred
Security Beneficial Owner's interests in such Global Certificates, except as
provided in Section 9.7. Unless and until definitive, fully registered Preferred
Security Certificates (the "Definitive Preferred Security Certificates") have
been issued to the Preferred Security Beneficial Owners pursuant to Section 9.7:
(a) the provisions of this Section 9.4 shall be in full force and
effect;
(b) the Trust and the Trustees shall be entitled to deal with the
Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Certificates and receiving
approvals, votes or consents hereunder) as the Holder of the Preferred
Securities and the sole holder of the Global Certificates and shall have
no obligation to the Preferred Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.4 conflict
with any other provisions of this Declaration, the provisions of this
Section 9.4 shall control; and
(d) the rights of the Preferred Security Beneficial Owners shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Preferred Security
Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants and receive and transmit payments of Distributions on the
Global Certificates to such Clearing Agency Participants. DTC will make
book entry transfers among the Clearing Agency Participants.
SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Preferred Security
Holders is required under this Declaration, unless and until Definitive
Preferred Security Certificates shall have been issued to the Preferred Security
Beneficial Owners pursuant to Section 9.7, the Regular Trustees shall give all
such notices and communications specified herein to be given to the Preferred
Security Holders to the Clearing Agency, and shall have no notice obligations to
the Preferred Security Beneficial Owners.
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SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred Securities, the Regular
Trustees may, in their sole discretion, appoint a successor Clearing Agency with
respect to such Preferred Securities.
SECTION 9.7 Definitive Preferred Security Certificates.
If:
(a) a Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred Securities and a
successor Clearing Agency is not appointed within 90 days after such
discontinuance pursuant to Section 9.6; or
(b) the Regular Trustees elect after consultation with the Sponsor
to terminate the book entry system through the Clearing Agency with
respect to the Preferred Securities,
then:
(c) Definitive Preferred Security Certificates shall be prepared by
the Regular Trustees on behalf of the Trust with respect to such Preferred
Securities; and
(d) upon surrender of the Global Certificates by the Clearing
Agency, accompanied by registration instructions, the Regular Trustees
shall cause Definitive Certificates to be delivered to Preferred Security
Beneficial Owners in accordance with the instructions of the Clearing
Agency. Neither the Trustees nor the Trust shall be liable for any delay
in delivery of such instructions and each of them may conclusively rely on
and shall be protected in relying on, said instructions of the Clearing
Agency. The Definitive Preferred Security Certificates shall be printed,
lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as evidenced by their
execution thereof, and may have such letters, numbers or other marks of
identification or designation and such legends or endorsements as the
Regular Trustees may deem appropriate, or as may be required to comply
with any law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any stock exchange on which Preferred Securities
may be listed, or to conform to usage.
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SECTION 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.
If:
(a) any mutilated Certificates should be surrendered to the Regular
Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such security
or indemnity as may be required by them to keep each of them harmless.
then, in the absence of notice that such Certificate shall have been acquired by
a bona fide purchaser, any Regular Trustee on behalf of the Trust shall execute
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Certificate, a new Certificate of like denomination. In connection
with the issuance of any new Certificate under this Section 9.8, the Regular
Trustees may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith. Any duplicate
Certificate issued pursuant to this Section shall constitute conclusive evidence
of an ownership interest in the relevant Securities, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at any
time.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration, the Preferred
Securities Guarantee and the terms of the Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion of the capital
contributions (or any return thereon) of the Holders of the Securities
which shall be made solely from assets of the Trust; and
(ii) required to pay to the Trust or to any Holder of Securities any
deficit upon dissolution of the Trust or otherwise.
(b) The Holder of the Common Securities shall be liable for all of
the debts and obligations of the Trust (other than with respect to the
Securities) to the extent not satisfied out of the Trust's assets.
(c) Pursuant to ss. 3803(a) of the Business Trust Act, the Holders
of the Preferred Securities shall be entitled to the same limitation of personal
liability extended to
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stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.
SECTION 10.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's gross negligence or
willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in
good faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Trust, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Securities might properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person
has duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Institutional Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between any
Covered Persons; or
(ii) whenever this Declaration or any other agreement contemplated
herein or therein provides that an Indemnified Person shall act in a
manner that is, or provides terms that are, fair and reasonable to the
Trust or any Holder of Securities,
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the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted
or required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have no duty
or obligation to give any consideration to any interest of or factors
affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Declaration or
by applicable law.
SECTION 10.4 Indemnification.
(a) (i) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Trust) by reason of the fact
that he is or was a Company Indemnified Person against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Trust, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the Company Indemnified Person
did not act in good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his conduct
was unlawful.
(ii) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company
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Indemnified Person against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or settlement of such
action or suit if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the Trust and except that no
such indemnification shall be made in respect of any claim, issue or matter as
to which such Company Indemnified Person shall have been adjudged to be liable
to the Trust unless and only to the extent that the Court of Chancery of
Delaware or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which such Court of Chancery or such other court
shall deem proper.
(iii) To the extent that a Company Indemnified Person shall be
successful on the merits or otherwise (including dismissal of an action without
prejudice or the settlement of an action without admission of liability) in
defense of any action, suit or proceeding referred to in paragraphs (i) and (ii)
of this Section 10.4(a), or in defense of any claim, issue or matter therein, he
shall be indemnified, to the full extent permitted by law, against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
(iv) Any indemnification under paragraphs (i) and (ii) of this
Section 10.4(a) (unless ordered by a court) shall be made by the Debenture
Issuer only as authorized in the specific case upon a determination that
indemnification of the Company Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set forth in paragraphs
(i) and (ii). Such determination shall be made (1) by the Regular Trustees by a
majority vote of a quorum consisting of such Regular Trustees who were not
parties to such action, suit or proceeding, (2) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested Regular
Trustees so directs, by independent legal counsel in a written opinion, or (3)
by the Common Security Holder of the Trust.
(v) Expenses (including attorneys' fees) incurred by a Company
Indemnified Person in defending a civil, criminal, administrative or
investigative action, suit or proceeding referred to in paragraphs (i) and (ii)
of this Section 10.4(a) shall be paid by the Debenture Issuer in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such Company Indemnified Person to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Debenture Issuer as authorized in this Section 10.4(a).
Notwithstanding the foregoing, no advance shall be made by the Debenture Issuer
if a determination is reasonably and promptly made (i) by the Regular Trustees
by a majority vote of a quorum of disinterested Regular Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum of disinterested
Regular Trustees so directs, by independent legal counsel in a written opinion
or (iii) the Common Security Holder of the Trust, that, based upon the facts
known to the Regular Trustees, counsel or the Common Security Holder at the time
such determination is made, such Company Indemnified Person acted in bad faith
or in a manner that such person
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did not believe to be in or not opposed to the best interests of the Trust, or,
with respect to any criminal proceeding, that such Company Indemnified Person
believed or had reasonable cause to believe his conduct was unlawful. In no
event shall any advance be made in instances where the Regular Trustees,
independent legal counsel or Common Security Holder reasonably determine that
such person deliberately breached his duty to the Trust or its Common or
Preferred Security Holders.
(vi) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other paragraphs of this Section 10.4(a) shall not be
deemed exclusive of any other rights to which those seeking indemnification and
advancement of expenses may be entitled under any agreement, vote of
stockholders or disinterested directors of the Debenture Issuer or Preferred
Security Holders of the Trust or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office. All
rights to indemnification under this Section 10.4(a) shall be deemed to be
provided by a contract between the Debenture Issuer and each Company Indemnified
Person who serves in such capacity at any time while this Section 10.4(a) is in
effect. Any repeal or modification of this Section 10.4(a) shall not affect any
rights or obligations then existing.
(vii) The Debenture Issuer may purchase and maintain insurance on
behalf of any person who is or was a Company Indemnified Person against any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the Debenture Issuer would
have the power to indemnify him against such liability under the provisions of
this Section 10.4(a).
(viii) For purposes of this Section 10.4(a), references to "the
Trust" shall include, in addition to the resulting or surviving entity, any
constituent entity (including any constituent of a constituent) absorbed in a
consolidation or merger, so that any person who is or was a director, trustee,
officer or employee of such constituent entity, or is or was serving at the
request of such constituent entity as a director, trustee, officer, employee or
agent of another entity, shall stand in the same position under the provisions
of this Section 10.4(a) with respect to the resulting or surviving entity as he
would have with respect to such constituent entity if its separate existence had
continued.
(ix) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Section 10.4(a) shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a Company
Indemnified Person and shall inure to the benefit of the heirs, executors and
administrators of such a person.
(b) The Debenture Issuer agrees to indemnify the (i) Institutional
Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the Institutional
Trustee and the Delaware Trustee, and (iv) any officers, directors,
shareholders, members, partners, employees, representatives, custodians,
nominees or agents of the Institutional Trustee and the Delaware Trustee (each
of the Persons in (i) through (iv) being referred to as a "Fiduciary Indemnified
Person") for, and to hold each Fiduciary Indemnified Person harmless against,
any loss,
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liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration or the
trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against or investigating
any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder. The obligation to indemnify as set forth in this
Section 10.4(b) shall survive the satisfaction and discharge of this
Declaration.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the
Institutional Trustee may engage in or possess an interest in other business
ventures of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom, and the pursuit
of any such venture, even if competitive with the business of the Trust, shall
not be deemed wrongful or improper. No Covered Person, the Sponsor, the Delaware
Trustee, or the Institutional Trustee shall be obligated to present any
particular investment or other opportunity to the Trust even if such opportunity
is of a character that, if presented to the Trust, could be taken by the Trust,
and any Covered Person, the Sponsor, the Delaware Trustee and the Institutional
Trustee shall have the right to take for its own account (individually or as a
partner or fiduciary) or to recommend to others any such particular investment
or other opportunity. Any Covered Person, the Delaware Trustee and the
Institutional Trustee may engage or be interested in any financial or other
transaction with the Sponsor or any Affiliate of the Sponsor, or may act as
depositary for, trustee or agent for, or act on any committee or body of holders
of, securities or other obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the calendar
year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Regular
Trustees shall keep, or cause to be kept, full books of account, records and
supporting documents, which shall reflect in reasonable detail, each transaction
of the Trust. The books of account shall be maintained on the accrual method of
accounting, in accordance with generally accepted accounting principles,
consistently applied. The Trust shall use the accrual method of accounting for
United States federal income tax purposes. The books of account and the
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records of the Trust shall be examined by and reported upon as of the end of
each Fiscal Year of the Trust by a firm of independent certified public
accountants selected by the Regular Trustees.
(b) The Regular Trustees shall cause to be prepared and delivered to
each of the Holders of Securities, within 90 days after the end of each Fiscal
Year of the Trust, annual financial statements of the Trust, including a balance
sheet of the Trust as of the end of such Fiscal Year, and the related statements
of income or loss;
(c) The Regular Trustees shall cause to be duly prepared and
delivered to each of the Holders of Securities, any annual United States federal
income tax information statement, required by the Code, containing such
information with regard to the Securities held by each Holder as is required by
the Code and the Treasury Regulations. Notwithstanding any right under the Code
to deliver any such statement at a later date, the Regular Trustees shall
endeavor to deliver all such statements within 30 days after the end of each
Fiscal Year of the Trust.
(d) The Regular Trustees shall cause to be duly prepared and filed
with the appropriate taxing authority, an annual United States federal income
tax return, on a Form 1041 or such other form required by United States federal
income tax law, and any other annual income tax returns required to be filed by
the Regular Trustees on behalf of the Trust with any state or local taxing
authority.
SECTION 11.3 Banking.
The Trust shall maintain one or more bank accounts in the name and
for the sole benefit of the Trust; provided, however, that all payments of funds
in respect of the Debentures held by the Institutional Trustee shall be made
directly to the Institutional Trustee Account and no other funds of the Trust
shall be deposited in the Institutional Trustee Account. The sole signatories
for such accounts shall be designated by the Regular Trustees; provided,
however, that the Institutional Trustee shall designate the signatories for the
Institutional Trustee Account.
SECTION 11.4 Withholding.
The Trust and the Regular Trustees shall comply with all withholding
requirements under United States federal, state and local law. The Trust shall
request, and the Holders shall provide to the Trust, such forms or certificates
as are necessary to establish an exemption from withholding with respect to each
Holder, and any representations and forms as shall reasonably be requested by
the Trust to assist it in determining the extent of, and in fulfilling, its
withholding obligations. The Regular Trustees shall file required forms with
applicable jurisdictions and, unless an exemption from withholding is properly
established by a Holder, shall remit amounts withheld with respect to the Holder
to applicable jurisdictions. To the extent that the Trust is required to
withhold and pay over
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any amounts to any authority with respect to distributions or allocations to any
Holder, the amount withheld shall be deemed to be a distribution in the amount
of the withholding to the Holder. In the event of any claimed overwithholding,
Holders shall be limited to an action against the applicable jurisdiction. If
the amount required to be withheld was not withheld from actual Distributions
made, the Trust may reduce subsequent Distributions by the amount of such
withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may only be amended by a
written instrument approved and executed by:
(i) the Regular Trustees (or, if there are more than two Regular
Trustees a majority of the Regular Trustees);
(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Institutional Trustee, the Institutional
Trustee; and
(iii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, the Delaware Trustee;
(b) no amendment shall be made, and any such purported amendment
shall be void and ineffective:
(i) unless, in the case of any proposed amendment, the Institutional
Trustee shall have first received an Officers' Certificate from each of
the Trust and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the terms of the
Securities);
(ii) unless, in the case of any proposed amendment which affects the
rights, powers, duties, obligations or immunities of the Institutional
Trustee, the Institutional Trustee shall have first received:
(A) an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Securities);
and
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(B) an opinion of counsel (who may be counsel to the Sponsor
or the Trust) that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the
Securities); and
(iii) to the extent the result of such amendment would be to:
(A) cause the trust to fail to continue to be classified for
purposes of United States federal income taxation as a grantor
trust;
(B) reduce or otherwise adversely affect the powers of the
Institutional Trustee in contravention of the Trust Indenture Act;
or
(C) cause the Trust to be deemed to be an Investment Company
required to be registered under the Investment Company Act;
(c) at such time after the Trust has issued any Securities that
remain outstanding, any amendment that would adversely affect the rights,
privileges or preferences of any Holder of Securities may be effected only with
such additional requirements as may be set forth in the terms of such
Securities;
(d) Section 9.1(c) and this Section 12.1 shall not be amended
without the consent of all of the Holders of the Securities;
(e) Article IV shall not be amended without the consent of the
Holders of a Majority in liquidation amount of the Common Securities and;
(f) the rights of the Holders of the Common Securities under Article
V to increase or decrease the number of, and appoint and remove Trustees shall
not be amended without the consent of the Holders of a Majority in liquidation
amount of the Common Securities; and
(g) subject to Section 12.1(c), this Declaration may be amended
without the consent of the Holders of the Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this Declaration that
may be defective or inconsistent with any other provision of this
Declaration;
(iii) add to the covenants, restrictions or obligations of the
Sponsor;
(iv) to conform to any change in Rule 3a-5 or written change in
interpretation or application of Rule 3a-5 by any legislative body, court,
government
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agency or regulatory authority which amendment does not have a material
adverse effect on the right, preferences or privileges of the Holders; and
(v) to modify, eliminate and add to any provision of the Declaration
to such extent as may be reasonably necessary to effectuate any of the
foregoing or to otherwise comply with applicable law.
SECTION 12.2 Meetings of the Holders of Securities; Action by Written Consent.
(a) Meetings of the Holders of any class of Securities may be called
at any time by the Regular Trustees (or as provided in the terms of the
Securities) to consider and act on any matter on which Holders of such class of
Securities are entitled to act under the terms of this Declaration, the terms of
the Securities or the rules of any stock exchange on which the Preferred
Securities are listed or admitted for trading. The Regular Trustees shall call a
meeting of the Holders of such class if directed to do so by the Holders of
Securities representing at least 10% in liquidation amount of such class of
Securities. Such direction shall be given by delivering to the Regular Trustees
one or more calls in a writing stating that the signing Holders of Securities
wish to call a meeting and indicating the general or specific purpose for which
the meeting is to be called. Any Holders of Securities calling a meeting shall
specify in writing the Security Certificates held by the Holders of Securities
exercising the right to call a meeting and only those Securities specified shall
be counted for purposes of determining whether the required percentage set forth
in the second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:
(i) notice of any such meeting shall be given to all the Holders of
Securities having a right to vote thereat at least 7 days and not more
than 60 days before the date of such meeting. Whenever a vote, consent or
approval of the Holders of Securities is permitted or required under this
Declaration or the rules of any stock exchange on which the Preferred
Securities are listed or admitted for trading, such vote, consent or
approval may be given at a meeting of the Holders of Securities. Any
action that may be taken at a meeting of the Holders of Securities may be
taken without a meeting if a consent in writing setting forth the action
so taken is signed by the Holders of Securities owning not less than the
minimum amount of Securities in liquidation amount that would be necessary
to authorize or take such action at a meeting at which all Holders of
Securities having a right to vote thereon were present and voting. Prompt
notice of the taking of action without a meeting shall be given to the
Holders of Securities entitled to vote who have not consented in writing.
The Regular Trustees may specify that any written ballot submitted to the
Security Holder for the purpose of taking any action without a meeting
shall be returned to the Trust within the time specified by the Regular
Trustees;
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(ii) each Holder of a Security may authorize any Person to act for
it by proxy on all matters in which a Holder of Securities is entitled to
participate, including waiving notice of any meeting, or voting or
participating at a meeting. No proxy shall be valid after the expiration
of 11 months from the date thereof unless otherwise provided in the proxy.
Every proxy shall be revocable at the pleasure of the Holder of Securities
executing it. Except as otherwise provided herein, all matters relating to
the giving, voting or validity of proxies shall be governed by the General
Corporation Law of the State of Delaware relating to proxies, and judicial
interpretations thereunder, as if the Trust were a Delaware corporation
and the Holders of the Securities were stockholders of a Delaware
corporation;
(iii) each meeting of the Holders of the Securities shall be
conducted by the Regular Trustees or by such other Person that the Regular
Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration, the terms of
the Securities, the Trust Indenture Act or the listing rules of any stock
exchange on which the Preferred Securities are then listed or trading,
otherwise provides, the Regular Trustees, in their sole discretion, shall
establish all other provisions relating to meetings of Holders of
Securities, including notice of the time, place or purpose of any meeting
at which any matter is to be voted on by any Holders of Securities, waiver
of any such notice, action by consent without a meeting, the establishment
of a record date, quorum requirements, voting in person or by proxy or any
other matter with respect to the exercise of any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Institutional Trustee.
The Trustee that acts as initial Institutional Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Institutional Trustee represents and warrants to the Trust
and the Sponsor at the time of the Successor Institutional Trustee's acceptance
of its appointment as Institutional Trustee that:
(a) the Institutional Trustee is a national banking association with
trust powers, duly organized, validly existing and in good standing under
the laws of the United States, with trust power and authority to execute
and deliver, and to carry out and perform its obligations under the terms
of, the Declaration;
(b) the execution, delivery and performance by the Institutional
Trustee of the Declaration has been duly authorized by all necessary
corporate action on the
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part of the Institutional Trustee. The Declaration has been duly executed
and delivered by the Institutional Trustee, and it constitutes a legal,
valid and binding obligation of the Institutional 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 execution, delivery and performance of the Declaration by
the Institutional Trustee does not conflict with or constitute a breach of
the Articles of Organization or By-laws of the Institutional Trustee; and
(d) no consent, approval or authorization of, or registration with
or notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Institutional Trustee, of the
Declaration.
SECTION 13.2 Representations and Warranties of Delaware Trustee.
The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
(a) The Delaware Trustee is a Delaware banking corporation with
trust powers, duly organized, validly existing and in good standing 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 Declaration.
(b) The Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and the Declaration. The
Declaration under Delaware law constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance
with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' rights
generally and to general principles of equity and the discretion of the
court (regardless of whether the enforcement of such remedies is
considered in a proceeding in equity or at law).
(c) No consent, approval or authorization of, or registration with
or notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Delaware Trustee, of the
Declaration.
(d) The Delaware Trustee is a Delaware banking corporation with
trust powers, duly organized, validly existing and in good standing under
the laws of the
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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
Declaration.
(e) No consent, approval or authorization of, or registration with
or notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Delaware Trustee of the
Declaration.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices.
All notices provided for in this Declaration shall be in writing,
duly signed by the party giving such notice, and shall be delivered, telecopied
or mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the
Trust's mailing address set forth below (or such other address as the
Trust may give notice of to the Holders of the Securities):
Travelers Capital VI
c/o Travelers Group Inc.
388 Greenwich Street
New York, New York 10013
Attention: Heidi G. Miller
Irwin Ettinger
(b) if given to the Delaware Trustee, at the mailing address set
forth below (or such other address as Delaware Trustee may give notice of
to the Holders of the Securities):
Chase Manhattan Bank Delaware
1201 Market Street
Wilmington, Delaware 19801
(c) if given to the Institutional Trustee, at its Corporate Trust
Office to the attention of The Institutional Trust Group (or such other
address as the Institutional Trustee may give notice of to the Holders of
the Securities):
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(d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice of to the Trust):
Travelers Group Inc.
388 Greenwich Street
New York, New York 10013
Attention: Charles O. Prince, III, Secretary
(e) if given to any other Holder, at the address set forth on the
books and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 14.2 Governing Law.
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted in accordance with the laws of the State of Delaware
and all rights and remedies shall be governed by such laws without regard to
principles of conflict of laws.
SECTION 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be
classified for United States federal income tax purposes as a grantor trust. The
provisions of this Declaration shall be interpreted to further this intention of
the parties.
SECTION 14.4 Headings.
Headings contained in this Declaration are inserted for convenience
of reference only and do not affect the interpretation of this Declaration or
any provision hereof.
SECTION 14.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
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SECTION 14.6 Partial Enforceability.
If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the remainder of
this Declaration, or the application of such provision to persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 14.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
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IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.
-----------------------------------
Heidi G. Miller, as Regular Trustee
-----------------------------------
Irwin Ettinger, as Regular Trustee
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By:
--------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as
Institutional Trustee
By:
--------------------------------
Name:
Title:
TRAVELERS GROUP INC., as Sponsor
By:
--------------------------------
Name:
Title:
<PAGE>
ANNEX I
TERMS OF
[ ]% TRUST PREFERRED SECURITIES
[ ]% TRUST COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated Declaration of
Trust, dated as of [ ], 199 (as amended from time to time, the "Declaration"),
the designation, rights, privileges, restrictions, preferences and other terms
and provisions of the Preferred Securities and the Common Securities are set out
below (each capitalized term used but not defined herein has the meaning set
forth in the Declaration or, if not defined in such Declaration, as defined in
the Prospectus referred to below):
1. Designation and Number.
(a) Preferred Securities. [ ] Preferred Securities of the Trust with
an aggregate liquidation amount with respect to the assets of the Trust of
million dollars ($[ ]), plus up to an additional ______ Preferred Securities of
the Trust with an aggregate liquidation amount with respect to the assets of the
Trust of __________ ($________) solely to cover over-allotments, as provided for
in the Underwriting Agreement and a liquidation amount with respect to the
assets of the Trust of $25 per preferred security, are hereby designated for the
purposes of identification only as "[ ]% Trust Preferred Securities" (the
"Preferred Securities"). The Preferred Security Certificates evidencing the
Preferred Securities shall be substantially in the form of Exhibit A-1 to the
Declaration, with such changes and additions thereto or deletions therefrom as
may be required by ordinary usage, custom or practice or to conform to the rules
of any stock exchange on which the Preferred Securities are listed.
(b) Common Securities. [ ] Common Securities of the Trust with an
aggregate liquidation amount with respect to the assets of the Trust of dollars
($[ ]) (_________ ($_________) if the over-allotment option granted to the
underwriters pursuant to the Underwriting Agreement is exercised in full) and a
liquidation amount with respect to the assets of the Trust of $25 per common
security, are hereby designated for the purposes of identification only as "[ ]%
Trust Common Securities" (the "Common Securities"). The Common Security
Certificates evidencing the Common Securities shall be substantially in the form
of Exhibit A-2 to the Declaration, with such changes and additions thereto or
deletions therefrom as may be required by ordinary usage, custom or practice.
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2. Distributions.
(a) Distributions payable on each Security will be fixed at a rate
per annum of [ ]% (the "Coupon Rate") of the stated liquidation amount of $25
per Security, such rate being the rate of interest payable on the Debentures to
be held by the Institutional Trustee. Distributions in arrears beyond the first
date such Distributions are payable (or would be payable if not for any
Extension Period (as defined below) or default by the Debenture Issuer on the
Debentures) will bear interest thereon compounded quarterly at the Coupon Rate
(to the extent permitted by applicable law). The term "Distributions" as used
herein includes such cash distributions and any such interest payable unless
otherwise stated. A Distribution is payable only to the extent that payments are
made in respect of the Debentures held by the Institutional Trustee and to the
extent the Institutional Trustee has funds available therefor. The amount of
Distributions payable for any period will be computed for any full quarterly
Distribution period on the basis of a 360-day year of twelve 30-day months, and
for any period shorter than a full quarterly Distribution period for which
Distributions are computed, Distributions will be computed on the basis of the
actual number of days elapsed per 90-day quarter.
(b) Distributions on the Securities will be cumulative, will accrue
from and including [ ], 199 , and will be payable quarterly in arrears, on March
31, June 30, September 30, and December 31 of each year, commencing on [ ],
199__. When, as and if available for payment, Distributions will be made by the
Institutional Trustee, except as otherwise described below. The Debenture Issuer
has the right under the Indenture to defer payments of interest on the
Debentures by extending the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), during which Extension Period no interest shall be due and
payable on the Debentures, provided that no Extension Period may extend beyond
the date of maturity of the Debentures. As a consequence of the Debenture
Issuer's extension of the interest payment period, Distributions will also be
deferred. Despite such deferral, quarterly Distributions will continue to accrue
with interest thereon (to the extent permitted by applicable law) at the Coupon
Rate compounded quarterly during any such Extension Period. In the event that
the Debenture Issuer exercises its right to extend the interest payment period,
then (a) the Debenture Issuer shall not declare or pay any dividend on, make any
distributions with respect to, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of its capital stock or make any
guarantee payment with respect thereto (other than (i) repurchases, redemptions
or other acquisitions of shares of capital stock of Travelers in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of employees, officers, directors or consultants, (ii) as a result
of an exchange or conversion of any class or series of Travelers's capital stock
for any other class or series of Travelers's capital stock, or (iii) the
purchase of fractional interests in shares of Travelers's capital stock pursuant
to the conversion or exchange provisions of such capital stock or the security
being converted or exchanged) and (b) the Debenture Issuer shall not make any
payment of interest on or principal of (or premium, if any, on), or repay,
repurchase or redeem, any debt securities issued by the
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Debenture Issuer that rank pari passu with or junior to the Debentures. The
foregoing, however, will not apply to any stock dividends paid by Travelers
where the dividend stock is the same stock as that on which the dividend is
being paid. Prior to the termination of any such Extension Period, the Debenture
Issuer may further extend such Extension Period; provided that such Extension
Period, together with all such previous and further extensions thereof, may not
exceed 20 consecutive quarters; provided further, that no Extension Period may
extend beyond the maturity of the Debentures. Payments of accrued Distributions
will be payable to Holders as they appear on the books and records of the Trust
on the first record date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the above
requirements. The Regular Trustees will give notice to each Holder of any
Extension Period upon their receipt of notice thereof from the Debenture Issuer.
(c) Distributions on the Securities will be payable to the Holders
thereof as they appear on the books and records of the Trust at the close of
business on the relevant record dates. While the Preferred Securities remain in
book-entry only form, the relevant record dates shall be one Business Day prior
to the relevant payment dates which payment dates shall correspond to the
interest payment dates on the Debentures. Subject to any applicable laws and
regulations and the provisions of the Declaration, each such payment in respect
of the Preferred Securities will be made as described under the heading
"Description of the Preferred Securities -- Book-Entry Only Issuance -- The
Depository Trust Company" in the Prospectus Supplement dated [ ], 199__, (the
"Prospectus Supplement") to the Prospectus dated [ ], 199__ (together, the
"Prospectus"), of the Trust included in the Registration Statement on Form S-3
of the Sponsor, the Trust and certain other business trusts. The relevant record
dates for the Common Securities shall be the same record date as for the
Preferred Securities. If the Preferred Securities shall not continue to remain
in book-entry only form, the relevant record dates for the Preferred Securities
shall conform to the rules of any securities exchange on which the securities
are listed and, if none, shall be selected by the Regular Trustees, which dates
shall be at least 14 days but no more than 60 days before the relevant payment
dates, which payment dates shall correspond to the interest payment dates on the
Debentures. Distributions payable on any Securities that are not punctually paid
on any Distribution payment date, as a result of the Debenture Issuer having
failed to make a payment under the Debentures, will cease to be payable to the
Person in whose name such Securities are registered on the relevant record date,
and such defaulted Distribution will instead be payable to the Person in whose
name such Securities are registered on the special record date or other
specified date determined in accordance with the Indenture. If any date on which
Distributions are payable on the Securities is not a Business Day, then payment
of the Distribution payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay) except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on such date.
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(d) In the event that there is any money or other property held by
or for the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata (as defined herein) among the Holders of the Securities.
3. Liquidation Distribution Upon Dissolution.
In the event of any voluntary or involuntary dissolution, winding-up
or termination of the Trust, the Holders of the Securities on the date of the
dissolution, winding-up or termination, as the case may be, will be entitled to
receive out of the assets of the Trust available for distribution to Holders of
Securities after satisfaction of liabilities of creditors, distributions in an
amount equal to the aggregate of the stated liquidation amount of $25 per
Security plus accrued and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution"), unless, in connection with
such dissolution, winding-up or termination, Debentures in an aggregate
principal amount equal to the aggregate stated liquidation amount of, with an
interest rate equal to the Coupon Rate, and bearing accrued and unpaid interest
in an amount equal to the accrued and unpaid Distributions on, such Securities
outstanding at such time, have been distributed on a Pro Rata basis to the
Holders of the Securities in exchange for such Securities.
If, upon any such dissolution, the Liquidation Distribution can be
paid only in part because the Trust has insufficient assets available to pay in
full the aggregate Liquidation Distribution, then the amounts payable directly
by the Trust on the Securities shall be paid on a Pro Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole or in part,
whether at maturity or upon redemption (either at the option of the Debenture
Issuer or pursuant to a Special Event as described below), the proceeds from
such repayment or payment shall be simultaneously applied to redeem Securities
having an aggregate liquidation amount equal to the aggregate principal amount
of the Debentures so repaid or redeemed at a redemption price of $25 per
Security plus an amount equal to accrued and unpaid Distributions thereon at the
date of the redemption, payable in cash (the "Redemption Price"). Holders shall
be given not less than 30 nor more than 60 days notice of such redemption.
(b) If fewer than all the outstanding Securities are to be so
redeemed, the Securities will be redeemed Pro Rata and the Preferred Securities
to be redeemed will be as described in Section 4(f)(ii) below.
(c) If, at any time, a Tax Event or an Investment Company Event
(each as defined below, and each a "Special Event") shall occur and be
continuing, the Regular Trustees shall, except in certain limited circumstances
in relation to a Tax Event described in this Section 4(c), dissolve the Trust
and, after satisfaction of creditors, cause Debentures held by the Institutional
Trustee, having an aggregate principal amount equal to the aggregate
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stated liquidation amount of, with an interest rate identical to the Coupon
Rate, and with accrued and unpaid interest equal to accrued and unpaid
Distributions on, the Securities outstanding at such time, to be distributed to
the Holders of the Securities in liquidation of such Holders' interests in the
Trust on a Pro Rata basis, within 90 days following the occurrence of such
Special Event (the "90 Day Period"); provided, however, that, in the case of the
occurrence of a Tax Event, such dissolution and distribution shall be
conditioned on the Regular Trustees' receipt of an opinion of a nationally
recognized independent tax counsel experienced in such matters (a "No
Recognition Opinion"), which opinion may rely on published revenue rulings of
the Internal Revenue Service, to the effect that the Holders of the Securities
will not recognize any gain or loss for United States federal income tax
purposes as a result of such dissolution and distribution of Debentures, and
provided further, that, if at the time there is available to the Debenture
Issuer or the Trust the opportunity to eliminate, within the 90 Day Period, the
Special Event by taking some 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 Trust, the Debenture Issuer or the Holders of the
Securities ("Ministerial Action"), the Debenture Issuer or the Trust will pursue
such Ministerial Action in lieu of dissolution.
If in the case of the occurrence of a Tax Event, (i) the Debenture
Issuer has received an opinion (a "Redemption Tax Opinion") of a nationally
recognized independent tax counsel experienced in such matters that, as a result
of such Tax Event, there is more than an insubstantial risk that the Debenture
Issuer would be precluded from deducting the interest on the Debentures for
United States federal income tax purposes, even after the Debentures were
distributed to the Holders of Securities in liquidation of such Holders'
interests in the Trust as described in this Section 4(c), or (ii) the Regular
Trustees shall have been informed by such tax counsel that it cannot deliver a
No Recognition Opinion to the Regular Trustees, the Debenture Issuer shall have
the right, upon not less than 30 nor more than 60 days notice, to redeem the
Debentures, in whole or in part, for cash within 90 days following the
occurrence of such Tax Event, and, following such redemption, Securities with an
aggregate liquidation amount equal to the aggregate principal amount of the
Debentures so redeemed shall be redeemed by the Trust at the Redemption Price on
a Pro Rata basis; provided, however, that if at the time there is available to
the Debenture Issuer or the Trust the opportunity to eliminate, within such 90
day period, the Tax Event by taking some Ministerial Action, the Trust or the
Debenture Issuer will pursue such Ministerial Action in lieu of redemption.
"Tax Event" means that the Regular Trustees shall have received an
opinion of a nationally recognized independent tax counsel experienced in such
matters (a "Tax Event Opinion") to the effect that, as a result of (a) 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 (b) any amendment to, or
change in, an interpretation or application of such laws or regulations by any
legislative body, court, governmental agency or regulatory authority (including
the enactment of any legislation and the publication of any judicial decision or
regulatory
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<PAGE>
determination on or after the date of the Prospectus Supplement), in either case
after the date of the Prospectus Supplement, there is more than an insubstantial
risk that (i) the Trust would be subject to United States federal income tax
with respect to interest accrued or received on the Debentures, (ii) the Trust
would be subject to more than a de minimis amount of other taxes, duties or
other governmental charges, or (iii) interest payable to the Trust on the
Debentures would not be deductible, in whole or in part, by the Debenture Issuer
for United States federal income tax purposes.
"Investment Company Event" means that the Regular Trustees shall
have received an opinion of a nationally recognized independent counsel
experienced in practice under the Investment Company Act (an "Investment Company
Event Opinion") to the effect that, as a result of the occurrence of a change in
law or regulation or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law"), there is a more than an insubstantial
risk that the Trust is or will be considered an Investment Company which is
required to be registered under the Investment Company Act, which Change in 1940
Act Law becomes effective on or after the date of the Prospectus Supplement.
On and from the date fixed by the Regular Trustees for any
distribution of Debentures and dissolution of the Trust: (i) the Securities will
no longer be deemed to be outstanding, (ii) DTC or its nominee (or any successor
Clearing Agency or its nominee), as the record Holder of the Preferred
Securities, will receive a registered global certificate or certificates
representing the Debentures to be delivered upon such distribution and (iii) any
certificates representing Securities, except for certificates representing
Preferred Securities held by DTC or its nominee (or any successor Clearing
Agency or its nominee), will be deemed to represent beneficial interests in the
Debentures having an aggregate principal amount equal to the aggregate stated
liquidation amount of, with an interest rate identical to the Coupon Rate of,
and accrued and unpaid interest equal to accrued and unpaid Distributions on
such Securities until such certificates are presented to the Debenture Issuer or
its agent for transfer or reissue.
(d) The Trust may not redeem fewer than all the outstanding
Securities unless all accrued and unpaid Distributions have been paid on all
Securities for all quarterly Distribution periods terminating on or before the
date of redemption.
(e) If the Debentures are distributed to Holders of the Securities,
pursuant to the terms of the Indenture, the Debenture Issuer will use its best
efforts to have the Debentures listed on the New York Stock Exchange or on such
other exchange as the Preferred Securities were listed immediately prior to the
distribution of the Debentures.
(f) Redemption or Distribution procedures will be as follows:
(i) Notice of any redemption of, or notice of distribution of
Debentures in exchange for the Securities (a "Redemption/Distribution
Notice") will be given by
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the Trust by mail to each Holder of Securities to be redeemed or exchanged
not fewer than 30 nor more than 60 days before the date fixed for
redemption or exchange thereof which, in the case of a redemption, will be
the date fixed for redemption of the Debentures. For purposes of the
calculation of the date of redemption or exchange and the dates on which
notices are given pursuant to this Section 4(f)(i), a Redemption/
Distribution Notice shall be deemed to be given on the day such notice is
first mailed by first-class mail, postage prepaid, to Holders of
Securities. Each Redemption/Distribution Notice shall be addressed to the
Holders of Securities at the address of each such Holder appearing in the
books and records of the Trust. No defect in the Redemption/Distribution
Notice or in the mailing of either thereof with respect to any Holder
shall affect the validity of the redemption or exchange proceedings with
respect to any other Holder.
(ii) In the event that fewer than all the outstanding Securities are
to be redeemed, the Securities to be redeemed shall be redeemed Pro Rata
from each Holder of Preferred Securities, it being understood that, in
respect of Preferred Securities registered in the name of and held of
record by DTC or its nominee (or any successor Clearing Agency or its
nominee) or any nominee, the distribution of the proceeds of such
redemption will be made to each Clearing Agency Participant (or Person on
whose behalf such nominee holds such securities) in accordance with the
procedures applied by such agency or nominee.
(iii) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice, which notice may only be issued if the
Debentures are redeemed as set out in this Section 4 (which notice will be
irrevocable), then (A) while the Preferred Securities are in book-entry
only form, with respect to the Preferred Securities, by 12:00 noon, New
York City time, on the redemption date, provided, that the Debenture
Issuer has paid the Institutional Trustee a sufficient amount of cash in
connection with the related redemption or maturity of the Debentures, the
Institutional Trustee will deposit irrevocably with DTC or its nominee (or
successor Clearing Agency or its nominee) funds sufficient to pay the
applicable Redemption Price with respect to the Preferred Securities and
will give DTC (or any successor Clearing Agency) irrevocable instructions
and authority to pay the Redemption Price to the Holders of the Preferred
Securities, and (B) with respect to Preferred Securities issued in
definitive form and Common Securities, provided that the Debenture Issuer
has paid the Institutional Trustee a sufficient amount of cash in
connection with the related redemption or maturity of the Debentures, the
Institutional Trustee will pay the relevant Redemption Price to the
Holders of such Securities by check mailed to the address of the relevant
Holder appearing on the books and records of the Trust on the redemption
date. If a Redemption/Distribution Notice shall have been given and funds
deposited as required, if applicable, then immediately prior to the close
of business on the date of such deposit, or on the redemption date, as
applicable, distributions will cease to accrue on the Securities so called
for redemption and all rights of Holders of such Securities so called for
redemption will
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cease, except the right of the Holders of such Securities to receive the
Redemption Price, but without interest on such Redemption Price. Neither
the Regular Trustees nor the Trust shall be required to register or cause
to be registered the transfer of any Securities that have been so called
for redemption. If any date fixed for redemption of Securities is not a
Business Day, then payment of the Redemption Price payable on such date
will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay) except
that, if such Business Day falls in the next calendar year, such payment
will be made on the immediately preceding Business Day, in each case with
the same force and effect as if made on such date fixed for redemption. If
payment of the Redemption Price in respect of any Securities is improperly
withheld or refused and not paid either by the Institutional Trustee or by
the Sponsor as guarantor pursuant to the relevant Securities Guarantee,
Distributions on such Securities will continue to accrue from the original
redemption date to the actual date of payment, in which case the actual
payment date will be considered the date fixed for redemption for purposes
of calculating the Redemption Price.
(iv) Redemption/Distribution Notices shall be sent by the Regular
Trustees on behalf of the Trust to (A) in respect of the Preferred
Securities, DTC or its nominee (or any successor Clearing Agency or its
nominee) if the Global Certificates have been issued or, if Definitive
Preferred Security Certificates have been issued, to the Holder thereof,
and (B) in respect of the Common Securities to the Holder thereof.
(v) Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws), the Debenture Issuer
or its affiliates may at any time and from time to time purchase
outstanding Preferred Securities by tender, in the open market or by
private agreement.
5. Voting Rights - Preferred Securities.
(a) Except as provided under Sections 5(b) and 7 and as otherwise
required by law and the Declaration, the Holders of the Preferred Securities
will have no voting rights.
(b) Subject to the requirements set forth in this paragraph, the
Holders of a Majority in aggregate liquidation amount of the Preferred
Securities, voting separately as a class, may direct the time, method, and place
of conducting any proceeding for any remedy available to the Institutional
Trustee, or direct the exercise of any trust or power conferred upon the
Institutional Trustee under the Declaration, including the right to direct the
Institutional Trustee, as holder of the Debentures, to (i) direct the time,
method and place of conducting any proceeding for any remedy available to the
Debenture Trustee, or exercise any trust or power conferred on the Debenture
Trustee with respect to the Debentures, (ii) waive any past Event of Default
that is waivable under Section 5.13 of the Indenture, (iii)
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exercise any right to rescind or annul a declaration that the principal of all
the Debentures shall be due and payable or (iv) consent to any amendment,
modification or termination of the Indenture or the Debentures where such
consent shall be required, provided, however, that, where a consent or action
under the Indenture would require the consent or act of each holder of each
Debenture affected thereby, such consent or action under the Indenture shall not
be effective until each Holder of Preferred Securities shall have consented to
such action or provided such consent. The Institutional Trustee shall not revoke
any action previously authorized or approved by a vote of the Holders of the
Preferred Securities. Except with respect to directing the time, method and
place of conducting a proceeding for a remedy available to the Institutional
Trustee, the Institutional Trustee, as holder of the Debentures, shall not take
any of the actions described in clauses (i), (ii), (iii) or (iv) above unless
the Institutional Trustee has obtained an opinion of a nationally recognized
independent tax counsel experienced in such matters to the effect that as a
result of such action, the Trust will not fail to be classified as a grantor
trust for United States federal income tax purposes. If the Institutional
Trustee fails to enforce its rights under the Debentures, any Holder of
Preferred Securities may directly institute a legal proceeding against the
Debenture Issuer to enforce the Institutional Trustee's rights under the
Debentures without first instituting a legal proceeding against the
Institutional Trustee or any other Person or entity. If a Declaration Event of
Default has occurred and is continuing and such event is attributable to the
failure of the Debenture Issuer to pay interest or principal on the Debentures
on the date such interest or principal is otherwise payable (or in the case of
redemption, on the redemption date), then a holder of Preferred Securities may
also directly institute a proceeding for enforcement of payment to such holder
(a "Direct Action") of the principal of or interest on the Debentures having a
principal amount equal to the aggregate liquidation amount of the Preferred
Securities of such holder on or after the respective due date specified in the
Debentures without first (i) directing the Institutional Trustee to enforce the
terms of the Debentures or (ii) instituting a legal proceeding directly against
the Debenture Issuer to enforce the Institutional Trustee's rights under the
Debentures. Except as provided in the preceding sentence, the Holders of
Preferred Securities will not be able to exercise directly any other remedy
available to the holders of the Debentures. In connection with such Direct
Action, Travelers will be subrogated to the rights of such holder of Preferred
Securities under the Declaration to the extent of any payment made by Travelers
to such holder of Preferred Securities in such Direct Action.
Any required approval or direction of Holders of Preferred
Securities may be given at a separate meeting of Holders of Preferred Securities
convened for such purpose, at a meeting of all of the Holders of Securities in
the Trust or pursuant to written consent. The Regular Trustees will cause a
notice of any meeting at which Holders of Preferred Securities are entitled to
vote, or of any matter upon which action by written consent of such Holders is
to be taken, to be mailed to each Holder of record of Preferred Securities. Each
such notice will include a statement setting forth (i) the date of such meeting
or the date by which such action is to be taken, (ii) a description of any
resolution proposed for adoption at such meeting on which such Holders are
entitled to vote or of such matter upon which written consent is sought and
(iii) instructions for the delivery of proxies or consents.
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No vote or consent of the Holders of the Preferred Securities will
be required for the Trust to redeem and cancel Preferred Securities or to
distribute the Debentures in accordance with this Declaration and the terms of
the Securities.
Notwithstanding that Holders of Preferred Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Preferred Securities that are owned by the Sponsor or any Affiliate of the
Sponsor shall not be entitled to vote or consent and shall, for purposes of such
vote or consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 6(b), (c) and 7 as otherwise
required by law and the Declaration, the Holders of the Common Securities will
have no voting rights.
(b) The Holders of the Common Securities are entitled, in accordance
with Article V of the Declaration, to vote to appoint, remove or replace any
Trustee or to increase or decrease the number of Trustees.
(c) Subject to Section 2.6 of the Declaration and only after the
Event of Default with respect to the Preferred Securities has been cured,
waived, or otherwise eliminated and subject to the requirements of the second to
last sentence of this paragraph, the Holders of a Majority in liquidation amount
of the Common Securities, voting separately as a class, may direct the time,
method, and place of conducting any proceeding for any remedy available to the
Institutional Trustee, or direct the exercise of any trust or power conferred
upon the Institutional Trustee under the Declaration, including (i) directing
the time, method, place of conducting any proceeding for any remedy available to
the Debenture Trustee, or exercising any trust or power conferred on the
Debenture Trustee with respect to the Debentures, (ii) waiving any past default
and its consequences that is waivable under Section 5.13 of the Indenture, or
(iii) exercising any right to rescind or annul a declaration that the principal
of all the Debentures shall be due and payable, provided that, where a consent
or action under the Indenture would require the consent or act of the Holders of
greater than a majority in principal amount of Debentures affected thereby (a
"Super Majority"), the Institutional Trustee may only give such consent or take
such action at the written direction of the Holders of at least the proportion
in liquidation amount of the Common Securities which the relevant Super Majority
represents of the aggregate principal amount of the Debentures outstanding.
Pursuant to this Section 6(c), the Institutional Trustee shall not revoke any
action previously authorized or approved by a vote of the Holders of the
Preferred Securities. Other than with respect to directing the time, method and
place of conducting any proceeding for any remedy available to the Institutional
Trustee or the Debenture Trustee as set forth above, the Institutional Trustee
shall not take any action in accordance with the directions of the Holders of
the Common Securities under this paragraph unless the Institutional Trustee has
obtained an opinion of tax counsel to the effect that for
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the purposes of United States federal income tax the Trust will not be
classified as other than a grantor trust on account of such action. If the
Institutional Trustee fails to enforce its rights under the Declaration, any
Holder of Common Securities may institute a legal proceeding directly against
any Person to enforce the Institutional Trustee's rights under the Declaration,
without first instituting a legal proceeding against the Institutional Trustee
or any other Person.
Any approval or direction of Holders of Common Securities may be
given at a separate meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Regular Trustees will cause a notice of any
meeting at which Holders of Common Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Common Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
the Debentures in accordance with the Declaration and the terms of the
Securities.
7. Amendments to Declaration and Indenture.
(a) In addition to any requirements under Section 12.1 of the
Declaration, if any proposed amendment to the Declaration provides for, or the
Regular Trustees otherwise propose to effect, (i) any action that would
adversely affect the powers, preferences or special rights of the Securities,
whether by way of amendment to the Declaration or otherwise, or (ii) the
dissolution, winding-up or termination of the Trust, other than as described in
Section 8.1 of the Declaration, then the Holders of outstanding Securities as a
class, will be entitled to vote on such amendment or proposal (but not on any
other amendment or proposal) and such amendment or proposal shall not be
effective except with the approval of the Holders of at least a Majority in
liquidation amount of the Securities, voting together as a single class;
provided, however, if any amendment or proposal referred to in clause (i) above
would adversely affect only the Preferred Securities or only the Common
Securities, then only the affected class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of a Majority in liquidation amount of such class of
Securities.
(b) In the event the consent of the Institutional Trustee as the
holder of the Debentures is required under the Indenture with respect to any
amendment, modification or termination on the Indenture or the Debentures, the
Institutional Trustee shall request the written direction of the Holders of the
Securities with respect to such amendment, modification or termination and shall
vote with respect to such amendment, modification or
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termination as directed by a Majority in liquidation amount of the Securities
voting together as a single class; provided, however, that where a consent under
the Indenture would require the consent of the holders of greater than a
majority in aggregate principal amount of the Debentures (a "Super Majority"),
the Institutional Trustee may only give such consent at the direction of the
Holders of at least the proportion in liquidation amount of the Securities which
the relevant Super Majority represents of the aggregate principal amount of the
Debentures outstanding; provided, further, that the Institutional Trustee shall
not take any action in accordance with the directions of the Holders of the
Securities under this Section 7(b) unless the Institutional Trustee has obtained
an opinion of tax counsel to the effect that for the purposes of United States
federal income tax the Trust will not be classified as other than a grantor
trust on account of such action.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
of Securities according to the aggregate liquidation amount of the Securities
held by the relevant Holder in relation to the aggregate liquidation amount of
all Securities outstanding unless, in relation to a payment, an Event of Default
under the Declaration has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the
Preferred Securities pro rata according to the aggregate liquidation amount of
Preferred Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggregate liquidation
amount of Common Securities held by the relevant Holder relative to the
aggregate liquidation amount of all Common Securities outstanding.
9. Ranking.
The Preferred Securities rank pari passu and payment thereon shall
be made Pro Rata with the Common Securities except that, where an Event of
Default occurs and is continuing under the Indenture in respect of the
Debentures held by the Institutional Trustee, the rights of Holders of the
Common Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to payment
of the Holders of the Preferred Securities.
10. Listing.
The Regular Trustees shall use their best efforts to cause the
Preferred Securities to be listed on the New York Stock Exchange, Inc.
11. Acceptance of Securities Guarantee and Indenture.
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Each Holder of Preferred Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee, including the subordination provisions therein and to the provisions
of the Indenture.
12. No Preemptive Rights.
The Holders of the Securities shall have no preemptive rights to
subscribe for any additional securities.
13. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration or the Preferred
Securities Guarantee, and the Indenture to a Holder without charge on written
request to the Sponsor at its principal place of business.
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EXHIBIT A-1
FORM OF PREFERRED SECURITY CERTIFICATE
THIS PREFERRED SECURITY IS A GLOBAL CERTIFICATE WITHIN THE MEANING
OF THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY (THE "DEPOSITARY") OR A NOMINEE OF THE DEPOSITARY. THIS
PREFERRED SECURITY IS EXCHANGEABLE FOR PREFERRED SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE DECLARATION AND NO TRANSFER OF THIS PREFERRED
SECURITY (OTHER THAN A TRANSFER OF THIS PREFERRED SECURITY AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN
LIMITED CIRCUMSTANCES.
UNLESS THIS PREFERRED SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW
YORK) TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY PREFERRED SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE &
CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
Certificate Number Number of Preferred Securities
CUSIP NO. _____________
Certificate Evidencing Preferred Securities
of
TRAVELERS Capital VI
[ ]% Trust Preferred Securities)
(Liquidation Amount $25 per Preferred Security)
TRAVELERS Capital VI, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that ___________
(the "Holder") is the registered owner of ________ (____) preferred securities
of the Trust representing undivided
A1-1
<PAGE>
beneficial interests in the assets of the Trust designated the [ ]% Trust
Preferred Securities (the "Preferred Securities"). The Preferred Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities are set
forth in, and this certificate and the Preferred Securities represented hereby
are issued and shall in all respects be subject to, the provisions of the
Amended and Restated Declaration of Trust of the Trust dated as of [ ], 199 , as
the same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Preferred Securities as set forth in Annex I
thereto. Capitalized terms used herein but not defined shall have the meaning
given them in the Declaration. The Holder is entitled to the benefits of the
Preferred Securities Guarantee to the extent provided therein. The Sponsor will
provide a copy of the Declaration, the Preferred Securities Guarantee and the
Indenture to a Holder without charge upon written request to the Sponsor at its
principal place of business.
The Holder of this certificate, by accepting this certificate, is
deemed to have (i) agreed to the terms of the Indenture and the Debentures,
including that the Debentures are subordinate and junior in right of payment to
all Senior Indebtedness (as defined in the Indenture) and (ii) agreed to the
terms of the Preferred Securities Guarantee, including that the Preferred
Securities Guarantee is (A) subordinate and junior in right of payment to all
other liabilities of Travelers, (B) pari passu with the most senior preferred or
preference stock now or hereafter issued by Travelers and with any guarantee now
or hereafter issued by Travelers with respect to preferred or preference stock
of Travelers's affiliates and (C) senior to Travelers's common stock.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Preferred Securities
as evidence of indirect beneficial ownership in the Debentures.
A1-2
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate this ___
day of _______, ____.
-----------------------------------
Heidi G. Miller, as Trustee
-----------------------------------
Irwin Ettinger, as Trustee
A1-3
<PAGE>
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security Certificate to:
________________________________________________________________________________
________________________________________________________________________________
_______________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
__________________________
(Insert address and zip code of assignee)
and irrevocably appoints
________________________________________________________________________________
________________________________________________________________________________
___________________________________________________________ agent to transfer
this Preferred Security Certificate on the books of the Trust. The agent may
substitute another to act for him or her.
Date: _______________________
Signature: __________________
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
A1-4
<PAGE>
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
TRANSFER OF THIS CERTIFICATE
IS SUBJECT TO THE CONDITIONS
SET FORTH IN THE DECLARATION
REFERRED TO BELOW
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
TRAVELERS Capital VI
[ ]% Trust Common Securities
(Liquidation Amount $25 per Common Security)
TRAVELERS Capital VI, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that Travelers
Group Inc., a Delaware corporation, (the "Holder") is the registered owner of
__________ (________) common securities of the Trust representing undivided
beneficial interests in the assets of the Trust designated the [ ]% Trust Common
Securities (the "Common Securities"). The Common Securities are transferable on
the books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for transfer
and satisfaction of the other conditions set forth in the Declaration (as
defined below), including, without limitation, Section 9.1 thereof. The
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities represented hereby are issued and shall in
all respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust dated as of [ ], 199 , as the same may be
amended from time to time (the "Declaration"), including the designation of the
terms of the Common Securities as set forth in Annex I thereto. Capitalized
terms used herein but not defined shall have the meaning given them in the
Declaration. The Sponsor will provide a copy of the Declaration and the
Indenture to a Holder without charge upon written request to the Sponsor at its
principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
A2-1
<PAGE>
The Holder of this certificate, by accepting this certificate, is
deemed to have agreed to the terms of the Indenture and the Debentures,
including that the Debentures are subordinate and junior in right of payment to
all Senior Indebtedness (as defined in the Indenture) as and to the extent
provided in the Indenture.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Common Securities as
evidence of indirect beneficial ownership in the Debentures.
A2-2
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate this ___ day
of _________, ____.
-----------------------------------
Heidi G. Miller, as Trustee
-----------------------------------
Irwin Ettinger, as Trustee
A2-3
<PAGE>
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common Security
Certificate to:
________________________________________________________________________________
________________________________________________________________________________
_______________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
__________________________
(Insert address and zip code of assignee)
and irrevocably appoints
_______________________________________________________
________________________________________________________________________________
_________________________________ agent to transfer this Common Security
Certificate on the books of the Trust. The agent may substitute another to act
for him or her.
Date: _______________________
Signature: __________________
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
A2-4
<PAGE>
EXHIBIT B
SPECIMEN OF DEBENTURE
B-1
<PAGE>
EXHIBIT C
UNDERWRITING AGREEMENT
C-1
<PAGE>
Exhibit 4.8
==================================
AMENDED AND RESTATED DECLARATION
OF TRUST
TRAVELERS Capital VII
Dated as of [ ], 199_
==================================
<PAGE>
TABLE OF CONTENTS
-----------------
Page
----
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.................................................... 1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application............................... 7
SECTION 2.2 Lists of Holders of Securities................................. 8
SECTION 2.3 Reports by the Institutional Trustee........................... 8
SECTION 2.4 Periodic Reports to Institutional Trustee...................... 8
SECTION 2.5 Evidence of Compliance with Conditions Precedent............... 9
SECTION 2.6 Events of Default; Waiver...................................... 9
SECTION 2.7 Event of Default; Notice....................................... 10
ARTICLE III
ORGANIZATION
SECTION 3.1 Name........................................................... 11
SECTION 3.2 Office......................................................... 11
SECTION 3.3 Purpose........................................................ 12
SECTION 3.4 Authority...................................................... 12
SECTION 3.5 Title to Property of the Trust................................. 12
SECTION 3.6 Powers and Duties of the Regular Trustees...................... 12
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees........... 15
SECTION 3.8 Powers and Duties of the Institutional Trustee................. 16
SECTION 3.9 Certain Duties and Responsibilities of the Institutional
Trustee........................................................ 18
SECTION 3.10 Certain Rights of Institutional Trustee........................ 20
SECTION 3.11 Delaware Trustee............................................... 22
SECTION 3.12 Execution of Documents......................................... 22
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities......... 22
SECTION 3.14 Duration of Trust.............................................. 22
SECTION 3.15 Mergers........................................................ 23
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities........................ 24
SECTION 4.2 Responsibilities of the Sponsor................................ 24
i
<PAGE>
Page
----
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees............................................. 25
SECTION 5.2 Delaware Trustee............................................... 26
SECTION 5.3 Institutional Trustee; Eligibility............................. 26
SECTION 5.4 Qualifications of Regular Trustees and Delaware Trustee
Generally...................................................... 27
SECTION 5.5 Initial Trustees; Additional Powers of Regular Trustees........ 27
SECTION 5.6 Appointment, Removal and Resignation of Trustees............... 28
SECTION 5.7 Vacancies among Trustees....................................... 29
SECTION 5.8 Effect of Vacancies............................................ 30
SECTION 5.9 Meetings....................................................... 30
SECTION 5.10 Delegation of Power............................................ 30
SECTION 5.11 Merger, Conversion, Consolidation or Succession to
Business....................................................... 31
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.................................................. 31
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities........................ 31
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust........................................... 32
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities......................................... 33
SECTION 9.2 Transfer of Certificates....................................... 34
SECTION 9.3 Deemed Security Holders........................................ 34
SECTION 9.4 Book Entry Interests........................................... 35
SECTION 9.5 Notices to Clearing Agency..................................... 35
SECTION 9.6 Appointment of Successor Clearing Agency....................... 36
ii
<PAGE>
Page
----
SECTION 9.7 Definitive Preferred Security Certificates..................... 36
SECTION 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.............. 37
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability...................................................... 37
SECTION 10.2 Exculpation.................................................... 38
SECTION 10.3 Fiduciary Duty................................................. 38
SECTION 10.4 Indemnification................................................ 39
SECTION 10.5 Outside Businesses............................................. 42
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.................................................... 42
SECTION 11.2 Certain Accounting Matters..................................... 42
SECTION 11.3 Banking........................................................ 43
SECTION 11.4 Withholding.................................................... 43
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments..................................................... 44
SECTION 12.2 Meetings of the Holders of Securities; Action by Written
Consent........................................................ 46
ARTICLE XIII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Institutional Trustee........ 47
SECTION 13.2 Representations and Warranties of Delaware Trustee............. 48
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices........................................................ 49
SECTION 14.2 Governing Law.................................................. 50
SECTION 14.3 Intention of the Parties....................................... 50
iii
<PAGE>
Page
----
SECTION 14.4 Headings....................................................... 50
SECTION 14.5 Successors and Assigns......................................... 50
SECTION 14.6 Partial Enforceability......................................... 51
SECTION 14.7 Counterparts................................................... 51
ANNEX I TERMS OF SECURITIES............................................I-1
EXHIBIT A-1 FORM OF PREFERRED SECURITY
CERTIFICATE...................................................A1-1
EXHIBIT A-2 FORM OF COMMON SECURITY CERTIFICATE...........................A2-1
EXHIBIT B SPECIMEN OF DEBENTURE..........................................B-1
EXHIBIT C UNDERWRITING AGREEMENT.........................................C-1
iv
<PAGE>
CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Declaration
- ------------------- -----------
310(a)............................................. 5.3(a)
310(c)............................................. Inapplicable
311(c)............................................. Inapplicable
312(a)............................................. 2.2(a)
312(b)............................................. 2.2(b)
313................................................ 2.3
314(a)............................................. 2.4
314(b)............................................. Inapplicable
314(c)............................................. 2.5
314(d)............................................. Inapplicable
314(f)............................................. Inapplicable
315(a)............................................. 3.9(b)
315(c)............................................. 3.9(a)
315(d)............................................. 3.9(a)
316(a)............................................. Annex I
316(c)............................................. 3.6(e)
- ---------------
* This Cross-Reference Table does not constitute part of the Declaration and
shall not affect the interpretation of any of its terms or provisions.
v
<PAGE>
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
TRAVELERS Capital VII
[ ], 199
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration") dated and
effective as of , 199 , by the Trustees (as defined herein), the Sponsor (as
defined herein) and by the holders, from time to time, of undivided beneficial
interests in the Trust to be issued pursuant to this Declaration;
WHEREAS, the Trustees and the Sponsor established Travelers Capital
VII (the "Trust"), a trust under the Business Trust Act (as defined herein)
pursuant to a Declaration of Trust dated as of May 14, 1997, (the "Original
Declaration") and a Certificate of Trust filed with the Secretary of State of
the State of Delaware on May 14, 1997, for the sole purpose of issuing and
selling certain securities representing undivided beneficial interests in the
assets of the Trust and investing the proceeds thereof in certain Debentures of
the Debenture Issuer;
WHEREAS, as of the date hereof, no interests in the Trust have been
issued;
WHEREAS, all of the Trustees and the Sponsor, by this Declaration,
amend and restate each and every term and provision of the Original Declaration;
and
NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined in
the preamble above have the respective meanings assigned to them in this
Section 1.1;
<PAGE>
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections and
Annexes and Exhibits are to Articles and Sections of and Annexes and
Exhibits to this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Declaration unless otherwise defined in this Declaration
or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405
of the Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means any Person that is authorized
to bind such Person.
"Book Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 9.4.
"Business Day" means any day other than a Saturday, Sunday or a day
on which banking institutions in the City of New York, New York are permitted or
required by any applicable law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code ss.3801 et seq., as it may be amended from time to time, or
any successor legislation.
"Certificate" means a Common Security Certificate or a Preferred
Security Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as depositary
for the Preferred Securities and in whose name or in the name of a nominee of
that organization shall be registered a Global Certificate and which shall
undertake to effect book entry transfers and pledges of the Preferred
Securities.
2
<PAGE>
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means [ ], 1997.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time, or any successor legislation.
"Commission" means the Securities and Exchange Commission.
"Common Security" has the meaning specified in Section 7.1.
"Common Security Certificate" means a definitive certificate in
fully registered form representing a Common Security substantially in the form
of Exhibit A-2.
"Company Indemnified Person" means (a) any Regular Trustee; (b) any
Affiliate of any Regular Trustee; (c) any officers, directors, shareholders,
members, partners, employees, representatives or agents of any Regular Trustee;
or (d) any officer, employee or agent of the Trust or its Affiliates.
"Corporate Trust Office" means the office of the Institutional
Trustee at which the corporate trust business of the Institutional Trustee
shall, at any particular time, be principally administered, which office at the
date of execution of this Declaration is located at 450 West 33rd Street, 15th
Floor, New York, New York 10001.
"Covered Person" means: (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means Travelers Group Inc. in its capacity as
issuer of the Debentures under the Indenture.
"Debenture Trustee" means The Chase Manhattan Bank, as trustee under
the Indenture until a successor is appointed thereunder, and thereafter means
such successor trustee.
"Debentures" means the series of Debentures to be issued by the
Debenture Issuer under the Indenture to be held by the Institutional Trustee, a
specimen certificate for such series of Debentures being Exhibit B.
"Definitive Preferred Security Certificates" has the meaning set
forth in Section 9.4.
3
<PAGE>
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Distribution" has the meaning set forth in Section 6.1.
"DTC" means the Depository Trust Company, the initial Clearing
Agency.
"Event of Default" in respect of the Securities means an Event of
Default (as defined in the Indenture) has occurred and is continuing in respect
of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"Fiduciary Indemnified Person" has the meaning set forth in Section
10.4(b).
"Global Certificate" has the meaning set forth in Section 9.4.
"Holder" means a Person in whose name a Certificate representing a
Security is registered, such Person being a beneficial owner within the meaning
of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of October 7, 1996, between
the Debenture Issuer and the Debenture Trustee, pursuant to which the Debentures
are to be issued.
"Institutional Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 5.3.
"Institutional Trustee Account" has the meaning set forth in Section
3.8(c).
"Investment Company" means an investment company as defined in the
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940,
as amended from time to time, or any successor legislation.
"Investment Company Event" has the meaning set forth in Annex I
hereto.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Majority in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or by the Trust Indenture Act,
Holder(s) of outstanding Securities voting together as a single class or, as the
context may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities voting separately as a class,
4
<PAGE>
who are the record owners of an aggregate liquidation amount representing more
than 50% of the aggregate liquidation amount (including the stated amount that
would be paid on redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentages are determined) of
all outstanding Securities of the relevant class.
"Ministerial Action" has the meaning set forth in the terms of the
Securities as set forth in Annex I.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Paying Agent" has the meaning specified in Section 3.8(h).
"Payment Amount" has the meaning specified in Section 6.1.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Securities Guarantee" means the guarantee agreement dated
as of [ ], 199_, of the Sponsor in respect of the Preferred Securities.
"Preferred Security" has the meaning specified in Section 7.1.
"Preferred Security Beneficial Owner" means, with respect to a Book
Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of a
Person maintaining an account with such
5
<PAGE>
Clearing Agency (directly as a Clearing Agency Participant or as an indirect
participant, in each case in accordance with the rules of such Clearing Agency).
"Preferred Security Certificate" means a certificate representing a
Preferred Security substantially in the form of Exhibit A-1.
"Quorum" means a majority of the Regular Trustees or, if there are
only two Regular Trustees, both of them.
"Regular Trustee" has the meaning specified in Section 5.1.
"Related Party" means, with respect to the Sponsor, any direct or
indirect wholly owned subsidiary of the Sponsor or any other Person that owns,
directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"Responsible Officer" means, with respect to the Institutional
Trustee, any officer within the Corporate Trust Office of the Institutional
Trustee, including any vice-president, any assistant vice-president, any
assistant secretary, the treasurer, any assistant treasurer or other officer of
the Corporate Trust Office of the Institutional Trustee customarily performing
functions similar to those performed by any of the above designated officers and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's knowledge of
and familiarity with the particular subject.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act.
"Securities" means the Common Securities and the Preferred
Securities.
"Securities Act" means the Securities Act of 1933, as amended from
time to time, or any successor legislation.
"Special Event" has the meaning set forth in Annex I hereto.
"Sponsor" means Travelers Group Inc. or any successor entity in a
merger, consolidation or amalgamation, in its capacity as sponsor of the Trust.
"Successor Delaware Trustee" has the meaning set forth in Section
5.6.
"Successor Entity" has the meaning set forth in Section 3.15(b).
"Successor Institutional Trustee" has the meaning set forth in
Section 5.6.
"Successor Securities" has the meaning set forth in Section 3.15(b).
"Super Majority" has the meaning set forth in Section 2.6(a)(ii).
6
<PAGE>
"Travelers" means Travelers/Aetna Property Casualty Corp., a
Delaware corporation.
"Tax Event" has the meaning set forth in Annex I hereto.
"10% in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or by the Trust Indenture Act,
Holder(s) of outstanding Securities voting together as a single class or, as the
context may require, Holders of outstanding Preferred Securities or Holders of
outstanding Common Securities voting separately as a class, who are the record
owners of an aggregate liquidation amount representing 10% or more of the
aggregate liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"Underwriting Agreement" means the Underwriting Agreement for the
offering and sale of Preferred Securities in the form of Exhibit C.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and shall, to the
extent applicable, be governed by such provisions.
(b) The Institutional Trustee shall be the only Trustee that is a
Trustee for the purposes of the Trust Indenture Act.
7
<PAGE>
(c) If and to the extent that any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by ss.ss. 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide the Institutional Trustee (i) within 14 days after each
record date for payment of Distributions, a list, in such form as the
Institutional Trustee may reasonably require, of the names and addresses of the
Holders of the Securities ("List of Holders") as of such record date, provided
that neither the Sponsor nor the Regular Trustees on behalf of the Trust shall
be obligated to provide such List of Holders at any time the List of Holders
does not differ from the most recent List of Holders given to the Institutional
Trustee by the Sponsor and the Regular Trustees on behalf of the Trust, and (ii)
at any other time, within 30 days of receipt by the Trust of a written request
for a List of Holders as of a date no more than 14 days before such List of
Holders is given to the Institutional Trustee. The Institutional Trustee shall
preserve, in as current a form as is reasonably practicable, all information
contained in Lists of Holders given to it or which it receives in the capacity
as Paying Agent (if acting in such capacity) provided that the Institutional
Trustee may destroy any List of Holders previously given to it on receipt of a
new List of Holders.
(b) The Institutional Trustee shall comply with its obligations
under ss.ss. 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Institutional Trustee.
Within 60 days after April 15 of each year, the Institutional
Trustee shall provide to the Holders of the Preferred Securities such reports as
are required by ss. 313 of the Trust Indenture Act, if any, in the form and in
the manner provided by ss. 313 of the Trust Indenture Act. The Institutional
Trustee shall also comply with the requirements of ss. 313(d) of the Trust
Indenture Act.
SECTION 2.4 Periodic Reports to Institutional Trustee.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Institutional Trustee such documents, reports and
information as required by ss. 314 (if any) and the compliance certificate
required by ss. 314 of the Trust Indenture Act in the form, in the manner and at
the times required by ss. 314 of the Trust Indenture Act.
8
<PAGE>
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Institutional Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Declaration that relate to
any of the matters set forth in ss. 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to ss.
314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default in respect of the Preferred
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, the Event of Default under
the Declaration shall also not be waivable; or
(ii) is waivable only with the consent of holders of more than a
majority in principal amount of the Debentures (a "Super Majority")
affected thereby, only the Holders of at least the proportion in aggregate
liquidation amount of the Preferred Securities that the relevant Super
Majority represents of the aggregate principal amount of the Debentures
outstanding may waive such Event of Default in respect of the Preferred
Securities under the Declaration.
The foregoing provisions of this Section 2.6(a) shall be in lieu of ss.
316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust
Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
default shall cease to exist, and any Event of Default with respect to the
Preferred Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other default or an Event of Default with respect to the Preferred
Securities or impair any right consequent thereon. Any waiver by the Holders of
the Preferred Securities of an Event of Default with respect to the Preferred
Securities shall also be deemed to constitute a waiver by the Holders of the
Common Securities of any such Event of Default with respect to the Common
Securities for all purposes of this Declaration without any further act, vote,
or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in liquidation amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
9
<PAGE>
(i) is not waivable under the Indenture, except where the Holders of
the Common Securities are deemed to have waived such Event of Default
under the Declaration as provided in this Section 2.6(b), the Event of
Default under the Declaration shall also not be waivable; or
(ii) is waivable only with the consent of a Super Majority, except
where the Holders of the Common Securities are deemed to have waived such
Event of Default under the Declaration as provided in this Section 2.6(b),
only the Holders of at least the proportion in aggregate liquidation
amount of the Common Securities that the relevant Super Majority
represents of the aggregate principal amount of the Debentures outstanding
may waive such Event of Default in respect of the Common Securities under
the Declaration;
provided further, each Holder of Common Securities will be deemed to have waived
any such Event of Default and all Events of Default with respect to the Common
Securities and its consequences until all Events of Default with respect to the
Preferred Securities have been cured, waived or otherwise eliminated, and until
such Events of Default with respect to the Preferred Securities have been so
cured, waived or otherwise eliminated, the Institutional Trustee will be deemed
to be acting solely on behalf of the Holders of the Preferred Securities and
only the Holders of the Preferred Securities will have the right to direct the
Institutional Trustee in accordance with the terms of the Securities. The
foregoing provisions of this Section 2.6(b) shall be in lieu of ss.ss.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such ss.ss.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly
excluded from this Declaration and the Securities, as permitted by the Trust
Indenture Act. Subject to the foregoing provisions of this Section 2.6(b), upon
the waiver of an Event of Default by the Holders of a Majority in liquidation
amount of the Common Securities, any such default shall cease to exist and any
Event of Default with respect to the Common Securities arising therefrom shall
be deemed to have been cured for every purpose of this Declaration, but no such
waiver shall extend to any subsequent or other default or Event of Default with
respect to the Common Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the
Institutional Trustee at the direction of the Holders of the Preferred
Securities, constitutes a waiver of the corresponding Event of Default under
this Declaration. The foregoing provisions of this Section 2.6(c) shall be in
lieu of ss. 316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of
the Trust Indenture Act is hereby expressly excluded from this Declaration and
the Securities, as permitted by the Trust Indenture Act.
SECTION 2.7 Event of Default; Notice.
(a) The Institutional Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders of the Securities, notices of (i) all defaults with
respect to the Securities actually known to a
10
<PAGE>
Responsible Officer of the Institutional Trustee, unless such defaults have been
cured before the giving of such notice (the term "defaults" for the purposes of
this Section 2.7(a) being hereby defined to be an Event of Default as defined in
the Indenture, not including any periods of grace provided for therein and
irrespective of the giving of any notice provided therein) and (ii) any notice
of default received from the Indenture Trustee with respect to the Debentures,
which notice from the Institutional Trustee to the Holders shall state that an
Event of Default under the Indenture also constitutes an Event of Default with
respect to the Securities; provided that, except for a default in the payment of
principal of (or premium, if any) or interest on any of the Debentures or in the
payment of any sinking fund installment established for the Debentures, the
Institutional Trustee shall be protected in withholding such notice if and so
long as a Responsible Officer of the Institutional Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders of the Securities.
(b) The Institutional Trustee shall not be deemed to have knowledge
of any default except:
(i) a default under Sections 5.1(1) and 5.1(2) of the Indenture; or
(ii) any default as to which the Institutional Trustee shall have
received written notice or of which a Responsible Officer of the
Institutional Trustee charged with the administration of the Declaration
shall have actual knowledge.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "Travelers Capital VII," as such name may be
modified from time to time by the Regular Trustees following written notice to
the Holders of Securities. The Trust's activities may be conducted under the
name of the Trust or any other name deemed advisable by the Regular Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o Travelers
Group Inc., 388 Greenwich Street, New York, New York 10013. On ten Business Days
written notice to the Holders of Securities, the Regular Trustees may designate
another principal office.
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SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to issue
and sell Securities and use the proceeds from such sale to acquire the
Debentures, and (b) except as otherwise limited herein, to engage in only those
other activities necessary, or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investments, pledge any of
its assets, or otherwise undertake (or permit to be undertaken) any activity
that would cause the Trust not to be classified for United States federal income
tax purposes as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration and to the
specific duties of the Institutional Trustee, the Regular Trustees shall have
exclusive and complete authority to carry out the purposes of the Trust. An
action taken by the Regular Trustees in accordance with their powers shall
constitute the act of and serve to bind the Trust and an action taken by the
Institutional Trustee on behalf of the Trust in accordance with its powers shall
constitute the act of and serve to bind the Trust. In dealing with the Trustees
acting on behalf of the Trust, no person shall be required to inquire into the
authority of the Trustees to bind the Trust. Persons dealing with the Trust are
entitled to rely conclusively on the power and authority of the Trustees as set
forth in this Declaration.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Debentures and
the Institutional Trustee Account or as otherwise provided in this Declaration,
legal title to all assets of the Trust shall be vested in the Trust. The Holders
shall not have legal title to any part of the assets of the Trust, but shall
have an undivided beneficial interest in the assets of the Trust.
SECTION 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:
(a) to issue and sell the Preferred Securities and the Common
Securities in accordance with this Declaration; provided, however, that
the Trust may issue no more than one series of Preferred Securities and no
more than one series of Common Securities, and, provided further, that
there shall be no interests in the Trust other than the Securities, and
the issuance of Securities shall be limited to a simultaneous issuance of
both Preferred Securities and Common Securities on the Closing Date;
(b) in connection with the issue and sale of the Preferred
Securities, at the direction of the Sponsor, to:
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(i) execute and file with the Commission on behalf of the
Trust a registration statement on Form S-3 or on another appropriate
form, or a registration statement under Rule 462(b) of the
Securities Act, in each case prepared by the Sponsor, including any
pre-effective or post-effective amendments thereto, relating to the
registration under the Securities Act of the Preferred Securities;
(ii) execute and file any documents prepared by the Sponsor,
or take any acts as determined by the Sponsor to be necessary in
order to qualify or register all or part of the Preferred Securities
in any State in which the Sponsor has determined to qualify or
register such Preferred Securities for sale;
(iii) execute and file an application, prepared by the
Sponsor, to the New York Stock Exchange, Inc., any other national
stock exchange or the Nasdaq National Market for listing upon notice
of issuance of any Preferred Securities;
(iv) execute and file with the Commission on behalf of the
Trust a registration statement on Form 8-A, prepared by the Sponsor,
including any pre-effective or post-effective amendments thereto,
relating to the registration of the Preferred Securities under
Section 12(b) of the Exchange Act; and
(v) deliver the Underwriting Agreement providing for the
sale of the Preferred Securities;
(c) to acquire the Debentures with the proceeds of the sale of the
Preferred Securities and the Common Securities; provided, however, that
the Regular Trustees shall cause legal title to the Debentures to be held
of record in the name of the Institutional Trustee for the benefit of the
Holders of the Preferred Securities and the Holders of Common Securities;
(d) to give the Sponsor and the Institutional Trustee prompt written
notice of the occurrence of a Special Event; provided that the Regular
Trustees shall consult with the Sponsor and the Institutional Trustee
before taking or refraining from taking any Ministerial Action in relation
to a Special Event;
(e) to establish a record date with respect to all actions to be
taken hereunder that require a record date be established, including and
with respect to, for the purposes of ss.316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue
relevant notices to the Holders of Preferred Securities and Holders of
Common Securities as to such actions and applicable record dates;
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(f) to take all actions and perform such duties as may be required
of the Regular Trustees pursuant to the terms of the Securities;
(g) to bring or defend, pay, collect, compromise, arbitrate, resort
to legal action, or otherwise adjust claims or demands of or against the
Trust ("Legal Action"), unless pursuant to Section 3.8(e), the
Institutional Trustee has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors,
and consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;
(j) to give the certificate required by ss. 314(a)(4) of the Trust
Indenture Act to the Institutional Trustee, which certificate may be
executed by any Regular Trustee;
(k) to incur expenses that are necessary or incidental to carry out
any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as, registrar and
transfer agent for the Securities;
(m) to give prompt written notice to the Holders of the Securities
of any notice received from the Debenture Issuer of its election to defer
payments of interest on the Debentures by extending the interest payment
period under the Indenture;
(n) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of
the State of Delaware and of each other jurisdiction in which such
existence is necessary to protect the limited liability of the Holders of
the Preferred Securities or to enable the Trust to effect the purposes for
which the Trust was created;
(o) to take any action, not inconsistent with this Declaration or
with applicable law, that the Regular Trustees determine in their
discretion to be necessary or desirable in carrying out the activities of
the Trust as set out in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an Investment
Company required to be registered under the Investment Company Act;
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(ii) causing the Trust to be classified for United States
federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture Issuer
for United States federal income tax purposes,
provided that such action does not adversely affect the interests of
Holders;
(p) to take all action necessary to cause all applicable tax returns
and tax information reports that are required to be filed with respect to
the Trust to be duly prepared and filed by the Regular Trustees, on behalf
of the Trust; and
(q) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing.
The Regular Trustees must exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Regular Trustees shall not take any
action that is inconsistent with the purposes and functions of the Trust set
forth in Section 3.3.
Subject to this Section 3.6, the Regular Trustees shall have none of
the powers or the authority of the Institutional Trustee set forth in Section
3.8.
Any expenses incurred by the Regular Trustees pursuant to this
Section 3.6 shall be reimbursed by the Debenture Issuer.
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.
(a) The Trust shall not, and the Trustees (including the
Institutional Trustee) shall not, engage in any activity other than as required
or authorized by this Declaration. In particular, the Trust shall not and the
Trustees (including the Institutional Trustee) shall cause the Trust not to:
(i) invest any proceeds received by the Trust from holding the
Debentures, but shall promptly distribute all such proceeds to Holders of
Securities pursuant to the terms of this Declaration and of the
Securities;
(ii) acquire any assets other than as expressly provided herein;
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness;
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(v) possess any power or otherwise act in such a way as to vary the
Trust assets or the terms of the Securities in any way whatsoever;
(vi) issue any securities or other evidences of beneficial ownership
of, or beneficial interest in, the Trust other than the Securities; or
(vii) other than as provided in this Declaration or Annex I, (A)
direct the time, method and place of exercising any trust or power conferred
upon the Debenture Trustee with respect to the Debentures, (B) waive any past
default that is waivable under the Indenture, (C) exercise any right to rescind
or annul any declaration that the principal of all the Debentures shall be due
and payable, or (D) consent to any amendment, modification or termination of the
Indenture or the Debentures where such consent shall be required unless the
Trust shall have obtained an opinion of nationally recognized independent tax
counsel experienced in such matters to the effect that as a result of such
action, the Trust will not fail to be classified as a grantor trust for United
States federal income tax purposes.
SECTION 3.8 Powers and Duties of the Institutional Trustee.
(a) The legal title to the Debentures shall be owned by and held of
record in the name of the Institutional Trustee in trust for the benefit of the
Holders of the Securities. The right, title and interest of the Institutional
Trustee to the Debentures shall vest automatically in each Person who may
hereafter be appointed as Institutional Trustee in accordance with Section 5.6.
Such vesting and cessation of title shall be effective whether or not
conveyancing documents with regard to the Debentures have been executed and
delivered.
(b) The Institutional Trustee shall not transfer its right, title
and interest in the Debentures to the Regular Trustees or to the Delaware
Trustee (if the Institutional Trustee does not also act as Delaware Trustee).
(c) The Institutional Trustee shall:
(i) establish and maintain a segregated non-interest bearing trust
account (the "Institutional Trustee Account") in the name of and under the
exclusive control of the Institutional Trustee on behalf of the Holders of
the Securities and, upon the receipt of payments of funds made in respect
of the Debentures held by the Institutional Trustee, deposit such funds
into the Institutional Trustee Account and make payments to the Holders of
the Preferred Securities and Holders of the Common Securities from the
Institutional Trustee Account in accordance with Section 6.1. Funds in the
Institutional Trustee Account shall be held uninvested until disbursed in
accordance with this Declaration. The Institutional Trustee Account shall
be an account that is maintained with a banking institution the rating on
whose long-term unsecured indebtedness assigned by a "nationally
recognized statistical rating organization," as that term is defined for
purposes of Rule 436(g)(2) under the
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Securities Act, is at least equal to the rating assigned to the Preferred
Securities by a nationally recognized statistical rating organization;
(ii) engage in such ministerial activities as shall be necessary or
appropriate to effect the redemption of the Preferred Securities and the
Common Securities to the extent the Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued by the Regular
Trustees in accordance with the terms of the Securities, engage in such
ministerial activities as shall be necessary or appropriate to effect the
distribution of the Debentures to Holders of Securities upon the
occurrence of certain Special Events or other specified circumstances
pursuant to the terms of the Securities.
(d) The Institutional Trustee shall take all actions and perform
such duties as may be specifically required of the Institutional Trustee
pursuant to the terms of the Securities.
(e) Subject to Section 2.6, the Institutional Trustee shall take any
Legal Action which arises out of or in connection with an Event of Default of
which a Responsible Officer of the Institutional Trustee has actual knowledge or
the Institutional Trustee's duties and obligations under this Declaration or the
Trust Indenture Act.
(f) The Institutional Trustee shall not resign as a Trustee unless
either:
(i) the Trust has been completely liquidated and the proceeds of the
liquidation distributed to the Holders of Securities pursuant to the terms
of the Securities; or
(ii) a Successor Institutional Trustee has been appointed and has
accepted that appointment in accordance with Section 5.6.
(g) The Institutional Trustee shall have the legal power to exercise
all of the rights, powers and privileges of a holder of Debentures under the
Indenture and, if an Event of Default actually known to a Responsible Officer of
the Institutional Trustee occurs and is continuing, the Institutional Trustee
shall, for the benefit of Holders of the Securities, enforce its rights as
holder of the Debentures subject to the rights of the Holders pursuant to the
terms of such Securities, this Declaration, the Business Trust Act and the Trust
Indenture Act.
(h) The Institutional Trustee may authorize one or more Persons
(each, a "Paying Agent") to pay Distributions, redemption payments or
liquidation payments on behalf of the Trust with respect to all securities and
any such Paying Agent shall comply with ss. 317(b) of the Trust Indenture Act.
Any Paying Agent may be removed by the
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Institutional Trustee at any time and a successor Paying Agent or additional
Paying Agents may be appointed at any time by the Institutional Trustee.
(i) Subject to this Section 3.8, the Institutional Trustee shall
have none of the duties, liabilities, powers or the authority of the Regular
Trustees set forth in Section 3.6.
The Institutional Trustee must exercise the powers set forth in this
Section 3.8 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Institutional Trustee shall not take
any action that is inconsistent with the purposes and functions of the Trust set
out in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the Institutional Trustee.
(a) The Institutional Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Declaration and no implied covenants shall be read into this Declaration
against the Institutional Trustee. In case an Event of Default has occurred
(that has not been cured or waived pursuant to Section 2.6) of which a
Responsible Officer of the Institutional Trustee has actual knowledge, the
Institutional Trustee shall exercise such of the rights and powers vested in it
by this Declaration, and use the same degree of care and skill in the exercise
of such rights and powers, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(b) No provision of this Declaration shall be construed to relieve
the Institutional Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Institutional Trustee
shall be determined solely by the express provisions of this
Declaration and the Institutional Trustee shall not be liable except
for the performance of such duties and obligations as are
specifically set forth in this Declaration, and no implied covenants
or obligations shall be read into this Declaration against the
Institutional Trustee; and
(B) in the absence of bad faith on the part of the
Institutional Trustee, the Institutional 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 Institutional Trustee and conforming to the
requirements of this Declaration; but in the case of any such
certificates or
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opinions that by any provision hereof are specifically required to
be furnished to the Institutional Trustee, the Institutional Trustee
shall be under a duty to examine the same to determine whether or
not they conform to the requirements of this Declaration;
(ii) the Institutional Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Institutional
Trustee, unless it shall be proved that the Institutional Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Institutional Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in
liquidation amount of the Securities relating to the time, method and
place of conducting any proceeding for any remedy available to the
Institutional Trustee, or exercising any trust or power conferred upon the
Institutional Trustee under this Declaration;
(iv) no provision of this Declaration shall require the
Institutional Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or in
the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Declaration or indemnity
reasonably satisfactory to the Institutional Trustee against such risk or
liability is not reasonably assured to it;
(v) the Institutional Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Debentures and the
Institutional Trustee Account shall be to deal with such property in a
similar manner as the Institutional Trustee deals with similar property
for its own account, subject to the protections and limitations on
liability afforded to the Institutional Trustee under this Declaration and
the Trust Indenture Act;
(vi) the Institutional Trustee shall have no duty or liability for
or with respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments levied thereon or in
connection therewith;
(vii) the Institutional Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree with the
Sponsor. Money held by the Institutional Trustee need not be segregated
from other funds held by it except in relation to the Institutional
Trustee Account maintained by the Institutional Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required by law; and
(viii) the Institutional Trustee shall not be responsible for
monitoring the compliance by the Regular Trustees or the Sponsor with
their respective duties under
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this Declaration, nor shall the Institutional Trustee be liable for any
default or misconduct of the Regular Trustees or the Sponsor.
SECTION 3.10 Certain Rights of Institutional Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Institutional 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, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and
to have been signed, sent or presented by the proper party or parties;
(ii) any direction or act of the Sponsor or the Regular Trustees
contemplated by this Declaration shall be sufficiently evidenced by an
Officers' Certificate;
(iii) whenever in the administration of this Declaration, the
Institutional Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder, the
Institutional 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 Sponsor or the Regular
Trustees;
(iv) the Institutional Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or securities
laws) or any rerecording, refiling or registration thereof;
(v) the Institutional Trustee may consult with counsel or other
experts and the advice or opinion of such counsel and experts with respect
to legal matters or advice within the scope of such experts' area of
expertise shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good
faith and in accordance with such advice or opinion, such counsel may be
counsel to the Sponsor or any of its Affiliates, and may include any of
its employees. The Institutional Trustee shall have the right at any time
to seek instructions concerning the administration of this Declaration
from any court of competent jurisdiction;
(vi) the Institutional Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration at
the request or direction of any Holder, unless such Holder shall have
provided to the Institutional Trustee security and indemnity, reasonably
satisfactory to the Institutional Trustee, against the
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costs, expenses (including attorneys' fees and expenses and the expenses
of the Institutional Trustee's agents, nominees or custodians) and
liabilities that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by the
Institutional Trustee provided, that, nothing contained in this Section
3.10(a)(vi) shall be taken to relieve the Institutional Trustee, upon the
occurrence of an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Declaration;
(vii) the Institutional Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Institutional Trustee, in
its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit;
(viii) the Institutional Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents, custodians, nominees or attorneys and the Institutional
Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder;
(ix) any action taken by the Institutional Trustee or its agents
hereunder shall bind the Trust and the Holders of the Securities, and the
signature of the Institutional Trustee or its agents alone shall be
sufficient and effective to perform any such action and no third party
shall be required to inquire as to the authority of the Institutional
Trustee to so act or as to its compliance with any of the terms and
provisions of this Declaration, both of which shall be conclusively
evidenced by the Institutional Trustee's or its agent's taking such
action;
(x) whenever in the administration of this Declaration the
Institutional Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action
hereunder, the Institutional Trustee (i) may request instructions from the
Holders of the Securities which instructions may only be given by the
Holders of the same proportion in liquidation amount of the Securities as
would be entitled to direct the Institutional Trustee under the terms of
the Securities in respect of such remedy, right or action, (ii) may
refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be protected in
conclusively relying on or acting in or accordance with such instructions;
and
(xi) except as otherwise expressly provided by this Declaration, the
Institutional Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Declaration.
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(b) No provision of this Declaration shall be deemed to impose any
duty or obligation on the Institutional Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Institutional Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Institutional
Trustee shall be construed to be a duty.
SECTION 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other than
Section 5.2, the Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities of
the Regular Trustees or the Institutional Trustee described in this Declaration.
Except as set forth in Section 5.2, the Delaware Trustee shall be a Trustee for
the sole and limited purpose of fulfilling the requirements of ss. 3807 of the
Business Trust Act.
SECTION 3.12 Execution of Documents.
Unless otherwise determined by the Regular Trustees, and except as
otherwise required by the Business Trust Act, a majority of or, if there are
only two, any Regular Trustee or, if there is only one, such Regular Trustee is
authorized to execute on behalf of the Trust any documents that the Regular
Trustees have the power and authority to execute pursuant to Section 3.6;
provided that, the registration statement referred to in Section 3.6(b)(i),
including any amendments thereto, shall be signed by all of the Regular
Trustees.
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities shall
be taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.
SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of Article
VIII hereof, shall have existence for fifty-five (55) years from the Closing
Date.
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SECTION 3.15 Mergers.
(a) The Trust may not consolidate, amalgamate, merge with or into,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except as
described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of the Regular Trustees or, if
there are more than two, a majority of the Regular Trustees and without the
consent of the Holders of the Securities, the Delaware Trustee or the
Institutional Trustee, consolidate, amalgamate, merge with or into, or be
replaced by a trust organized as such under the laws of any State; provided
that:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the Trust
under the Securities; or
(B) substitutes for the Securities other securities having
substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the
same as the Preferred Securities rank with respect to Distributions
and payments upon liquidation, redemption and otherwise;
(ii) the Debenture Issuer expressly acknowledges a trustee of the
Successor Entity that possesses the same powers and duties as the
Institutional Trustee as the Holder of the Debentures;
(iii) the Preferred Securities or any Successor Securities are
listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or with any other
organization on which the Preferred Securities are then listed or quoted;
(iv) such merger, consolidation, amalgamation or replacement does
not cause the Preferred Securities (including any Successor Securities) to
be downgraded by any nationally recognized statistical rating
organization;
(v) such merger, consolidation, amalgamation or replacement does not
adversely affect the rights, preferences and privileges of the Holders of
the Securities (including any Successor Securities) in any material
respect (other than with respect to any dilution of such Holders'
interests in the new entity as a result of such merger, consolidation,
amalgamation or replacement);
(vi) such Successor Entity has a purpose identical to that of the
Trust;
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(vii) prior to such merger, consolidation, amalgamation or
replacement, the Trust has received an opinion of a nationally recognized
independent counsel to the Trust experienced in such matters to the effect
that:
(A) such merger, consolidation, amalgamation or replacement
does not adversely affect the rights, preferences and privileges of
the Holders of the Securities (including any Successor Securities)
in any material respect (other than with respect to any dilution of
the Holders' interest in the new entity); and
(B) following such merger, consolidation, amalgamation or
replacement, neither the Trust nor the Successor Entity will be
required to register as an Investment Company;
(C) following such merger, consolidation, amalgamation or
replacement, the Trust (or the Successor Entity) will continue to be
classified as a grantor trust for United States federal income tax
purposes; and
(viii) the Sponsor guarantees the obligations of such Successor
Entity under the Successor Securities at least to the extent provided by
the Preferred Securities Guarantee.
(c) Notwithstanding Section 3.15(b), the Trust shall not, without
the consent of Holders of 100% in liquidation amount of the Securities,
consolidate, amalgamate, merge with or into, or be replaced by any other entity
or permit any other entity to consolidate, amalgamate, merge with or into, or
replace it, if in the opinion of a nationally recognized independent tax counsel
experienced in such matters, such consolidation, amalgamation, merger or
replacement would cause the Trust or Successor Entity to be classified as other
than a grantor trust for United States federal income tax purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
On the Closing Date, the Sponsor will purchase all of the Common
Securities issued by the Trust in an amount equal to 3% or more of the capital
of the Trust, at the same time as the Preferred Securities are sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Preferred Securities,
the Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
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(a) to prepare for filing by the Trust with the Commission a
registration statement on Form S-3 or on another appropriate form, or a
registration statement under Rule 462(b) of the Securities Act, including
any pre-effective or post-effective amendments thereto, relating to the
registration under the Securities Act of the Preferred Securities;
(b) to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Preferred Securities and
to do any and all such acts, other than actions which must be taken by the
Trust, and advise the Trust of actions it must take, and prepare for
execution and filing any documents to be executed and filed by the Trust,
as the Sponsor deems necessary or advisable in order to comply with the
applicable laws of any such States;
(c) to prepare for filing by the Trust an application to the New
York Stock Exchange, any other national stock exchange or the Nasdaq
National Market for listing upon notice of issuance of any Preferred
Securities;
(d) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A, including any pre-effective or
post-effective amendments thereto, relating to the registration of the
Preferred Securities under Section 12(b) of the Exchange Act, including
any amendments thereto; and
(e) to negotiate the terms of the Underwriting Agreement providing
for the sale of the Preferred Securities.
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees.
The number of Trustees initially shall be four (4), and:
(a) at any time before the issuance of any Securities, the Sponsor
may, by written instrument, increase or decrease the number of Trustees;
and
(b) after the issuance of any Securities, the number of Trustees may
be increased or decreased by vote of the Holders of a majority in
liquidation amount of the Common Securities voting as a class at a meeting
of the Holders of the Common Securities,
provided, however, that, the number of Trustees shall in no event be less than
two (2); provided further that (1) one Trustee, in the case of a natural person,
shall be a person who
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is a resident of the State of Delaware or that, if not a natural person, shall
be an entity which has its principal place of business in the State of Delaware
(the "Delaware Trustee"); (2) there shall be at least one Trustee who is an
employee or officer of, or is affiliated with the Sponsor (a "Regular Trustee");
and (3) one Trustee shall be the Institutional Trustee for so long as this
Declaration is required to qualify as an indenture under the Trust Indenture
Act, and such Trustee may also serve as Delaware Trustee if it meets the
applicable requirements.
SECTION 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place
of business in the State of Delaware, and otherwise meets the requirements
of applicable law,
provided that, if the Institutional Trustee has its principal place of business
in the State of Delaware and otherwise meets the requirements of applicable law,
then the Institutional Trustee shall also be the Delaware Trustee and Section
3.11 shall have no application.
SECTION 5.3 Institutional Trustee; Eligibility.
(a) There shall at all times be one Trustee that shall act as
Institutional Trustee which shall:
(i) not be an Affiliate of the Sponsor;
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Commission to act as an institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust powers, having
a combined capital and surplus of at least 50 million U.S. dollars
($50,000,000), and subject to supervision or examination by Federal,
State, Territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law or to
the requirements of the supervising or examining authority referred to
above, then for the purposes of this Section 5.3(a)(ii), the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published; and
(iii) if the Trust is excluded from the definition of an Investment
Company solely by means of Rule 3a-7 and to the extent Rule 3a-7 requires
a trustee having
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certain qualifications to hold title to the "eligible assets" of the
Trust, the Institutional Trustee shall possess those qualifications.
(b) If at any time the Institutional Trustee shall cease to be
eligible to so act under Section 5.3(a), the Institutional Trustee shall
immediately resign in the manner and with the effect set forth in Section
5.6(c).
(c) If the Institutional Trustee has or shall acquire any
"conflicting interest" within the meaning of ss. 310(b) of the Trust Indenture
Act, the Institutional Trustee and the Holders of the Common Securities (as if
such Holders were the obligor referred to in ss. 310(b) of the Trust Indenture
Act) shall in all respects comply with the provisions of ss. 310(b) of the Trust
Indenture Act.
(d) The Preferred Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause (i) of the
first provision contained in Section 310(b) of the Trust Indenture Act.
(e) The initial Institutional Trustee shall be as set forth in
Section 5.5 hereof.
SECTION 5.4 Qualifications of Regular Trustees and Delaware Trustee Generally.
Each Regular Trustee and the Delaware Trustee (unless the
Institutional Trustee also acts as Delaware Trustee) shall be either a natural
person who is at least 21 years of age or a legal entity that shall act through
one or more Authorized Officers.
SECTION 5.5 Initial Trustees; Additional Powers of Regular Trustees.
(a) The initial Regular Trustees shall be:
Heidi G. Miller
Irwin Ettinger
The initial Delaware Trustee shall be:
Chase Manhattan Bank Delaware
1201 Market Street
Wilmington, Delaware 19801
The initial Institutional Trustee shall be:
The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, New York 10001
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(b) Except as expressly set forth in this Declaration and except if
a meeting of the Regular Trustees is called with respect to any matter over
which the Regular Trustees have power to act, any power of the Regular Trustees
may be exercised by, or with the consent of, any one such Regular Trustee.
(c) Unless otherwise determined by the Regular Trustees, and except
as otherwise required by the Business Trust Act or applicable law, any Regular
Trustee is authorized to execute on behalf of the Trust any documents which the
Regular Trustees have the power and authority to cause the Trust to execute
pursuant to Section 3.6, provided, that, the registration statement referred to
in Section 3.6, including any amendments thereto, shall be signed by all of the
Regular Trustees; and
(d) a Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purposes of signing any documents which the Regular Trustees
have power and authority to cause the Trust to execute pursuant to Section 3.6.
SECTION 5.6 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 5.6(b), Trustees may be appointed or removed
without cause at any time:
(i) until the issuance of any Securities, by written instrument
executed by the Sponsor; and
(ii) after the issuance of any Securities, by vote of the Holders of
a Majority in liquidation amount of the Common Securities voting as a
class at a meeting of the Holders of the Common Securities.
(b)(i) The Trustee that acts as Institutional Trustee shall not be
removed in accordance with Section 5.6(a) until a successor Trustee possessing
the qualifications to act as Institutional Trustee under Section 5.3 (a
"Successor Institutional Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Institutional
Trustee and delivered to the Regular Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall not be removed
in accordance with Section 5.6(a) until a successor Trustee possessing the
qualifications to act as Delaware Trustee under Sections 5.2 and 5.4 (a
"Successor Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Delaware
Trustee and delivered to the Regular Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until his
successor shall have been appointed or until his death, removal or resignation.
Any Trustee may
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resign from office (without need for prior or subsequent accounting) by an
instrument in writing signed by the Trustee and delivered to the Sponsor and the
Trust, which resignation shall take effect upon such delivery or upon such later
date as is specified therein; provided, however, that:
(i) No such resignation of the Trustee that acts as the
Institutional Trustee shall be effective:
(A) until a Successor Institutional Trustee has been
appointed and has accepted such appointment by instrument executed
by such Successor Institutional Trustee and delivered to the Trust,
the Sponsor and the resigning Institutional Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the holders of
the Securities; and
(ii) no such resignation of the Trustee that acts as the Delaware
Trustee shall be effective until a Successor Delaware Trustee has been
appointed and has accepted such appointment by instrument executed by such
Successor Delaware Trustee and delivered to the Trust, the Sponsor and the
resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best
efforts to promptly appoint a Successor Delaware Trustee or Successor
Institutional Trustee as the case may be if the Institutional Trustee or the
Delaware Trustee delivers an instrument of resignation in accordance with this
Section 5.6.
(e) If no Successor Institutional Trustee or Successor Delaware
Trustee shall have been appointed and accepted appointment as provided in this
Section 5.6 within 60 days after delivery to the Sponsor and the Trust of an
instrument of resignation, the resigning Institutional Trustee or Delaware
Trustee, as applicable, may petition any court of competent jurisdiction for
appointment of a Successor Institutional Trustee or Successor Delaware Trustee.
Such court may thereupon, after prescribing such notice, if any, as it may deem
proper and prescribe, appoint a Successor Institutional Trustee or Successor
Delaware Trustee, as the case may be.
(f) No Institutional Trustee or Delaware Trustee shall be liable for
the acts or omissions to act of any Successor Institutional Trustee or Successor
Delaware Trustee, as the case may be.
SECTION 5.7 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 5.1, or if the number of Trustees is
increased pursuant to Section 5.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by
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the Regular Trustees or, if there are more than two, a majority of the Regular
Trustees shall be conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance with Section 5.6.
SECTION 5.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to annul the Trust. Whenever a vacancy in the number
of Regular Trustees shall occur, until such vacancy is filled by the appointment
of a Regular Trustee in accordance with Section 5.6, the Regular Trustees in
office, regardless of their number, shall have all the powers granted to the
Regular Trustees and shall discharge all the duties imposed upon the Regular
Trustees by this Declaration.
SECTION 5.9 Meetings.
If there is more than one Regular Trustee, meetings of the Regular
Trustees shall be held from time to time upon the call of any Regular Trustee.
Regular meetings of the Regular Trustees may be held at a time and place fixed
by resolution of the Regular Trustees. Notice of any in-person meetings of the
Regular Trustees shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than 48
hours before such meeting. Notice of any telephonic meetings of the Regular
Trustees or any committee thereof shall be hand delivered or otherwise delivered
in writing (including by facsimile, with a hard copy by overnight courier) not
less than 24 hours before a meeting. Notices shall contain a brief statement of
the time, place and anticipated purposes of the meeting. The presence (whether
in person or by telephone) of a Regular Trustee at a meeting shall constitute a
waiver of notice of such meeting except where a Regular Trustee attends a
meeting for the express purpose of objecting to the transaction of any activity
on the ground that the meeting has not been lawfully called or convened. Unless
provided otherwise in this Declaration, any action of the Regular Trustees may
be taken at a meeting by vote of a majority of the Regular Trustees present
(whether in person or by telephone) and eligible to vote with respect to such
matter, provided that a Quorum is present, or without a meeting by the unanimous
written consent of the Regular Trustees. In the event there is only one Regular
Trustee, any and all action of such Regular Trustee shall be evidenced by a
written consent of such Regular Trustee.
SECTION 5.10 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any documents contemplated in Section
3.6, including any registration statement or amendment thereto filed with the
Commission, or making any other governmental filing; and
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(b) the Regular Trustees shall have power to delegate from time to
time to such of their number or to officers of the Trust the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Regular Trustees or otherwise as the Regular Trustees may deem
expedient, to the extent such delegation is not prohibited by applicable law or
contrary to the provisions of the Trust, as set forth herein.
SECTION 5.11 Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Institutional Trustee or the Delaware
Trustee, as the case may be, may be merged or converted or with which either may
be consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Institutional Trustee or the Delaware Trustee, as the
case may be, shall be a party, or any corporation succeeding to all or
substantially all the corporate trust business of the Institutional Trustee or
the Delaware Trustee, as the case may be, shall be the successor of the
Institutional Trustee or the Delaware Trustee, as the case may be, hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions (as defined herein) in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Preferred Securities and the Common
Securities in accordance with the preferences set forth in their respective
terms. If and to the extent that the Debenture Issuer makes a payment of
interest (including Compounded Interest (as defined in the Indenture) and
Additional Interest (as defined in the Indenture)), premium and/or principal on
the Debentures held by the Institutional Trustee (the amount of any such payment
being a "Payment Amount"), the Institutional Trustee shall and is directed to
make a distribution (a "Distribution") of the Payment Amount to Holders.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Regular Trustees shall on behalf of the Trust issue one
class of preferred securities representing undivided beneficial interests in the
assets of the Trust having such terms as are set forth in Annex I (the
"Preferred Securities") and one class of common securities representing
undivided beneficial interests in the assets of the Trust
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having such terms as are set forth in Annex I (the "Common Securities"). The
Trust shall issue no securities or other interests in the assets of the Trust
other than the Preferred Securities and the Common Securities.
(b) The Certificates shall be signed on behalf of the Trust by a
Regular Trustee. Such signature shall be the manual or facsimile signature of
any present or any future Regular Trustee. In case any Regular Trustee of the
Trust who shall have signed any of the Securities shall cease to be such Regular
Trustee before the Certificates so signed shall be delivered by the Trust, such
Certificates nevertheless may be delivered as though the person who signed such
Certificates had not ceased to be such Regular Trustee; and any Certificate may
be signed on behalf of the Trust by such persons who, at the actual date of
execution of such Security, shall be the Regular Trustees of the Trust, although
at the date of the execution and delivery of the Declaration any such person was
not such a Regular Trustee. Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Regular Trustees, as evidenced by their execution thereof, and may have such
letters, numbers or other marks of identification or designation and such
legends or endorsements as the Regular Trustees may deem appropriate, or as may
be required to comply with any law or with any rule or regulation of any stock
exchange on which Securities may be listed, or to conform to usage.
(c) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(d) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable.
(e) Every Person, by virtue of having become a Holder or a Preferred
Security Beneficial Owner in accordance with the terms of this Declaration,
shall be deemed to have expressly assented and agreed to the terms of, and shall
be bound by, this Declaration.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.
(a) The Trust shall terminate:
(i) upon the bankruptcy of any Holder of the Common Securities or
the Sponsor;
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(ii) upon the filing of a certificate of dissolution or its
equivalent with respect to any Holder of the Common Securities or the
Sponsor; the filing of a certificate of cancellation with respect to the
Trust or the revocation of the Holder of the Common Securities or the
Sponsor's charter and the expiration of 90 days after the date of
revocation without a reinstatement thereof;
(iii) upon the entry of a decree of judicial dissolution of any
Holder of the Common Securities, the Sponsor or the Trust;
(iv) when all of the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall have
been paid to the Holders in accordance with the terms of the Securities;
(v) upon the occurrence and continuation of a Special Event pursuant
to which the Trust shall have been dissolved in accordance with the terms
of the Securities and all of the Debentures endorsed thereon shall have
been distributed to the Holders of Securities in exchange for all of the
Securities;
(vi) before the issuance of any Securities, with the consent of all
of the Regular Trustees and the Sponsor; or
(vii) upon the expiration of the term of the Trust set forth in
Section 3.14;
provided, that so long as any Preferred Securities are outstanding and are not
held entirely by Travelers, the Trust may not voluntarily liquidate, dissolve,
wind-up or terminate except in connection with the occurrence of a Special
Event.
(b) As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a), the Trustees shall file a certificate of
cancellation with the Secretary of State of the State of Delaware.
(c) The provisions of Section 3.9 and Article X shall survive the
termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Declaration and in
the terms of the Securities. Any transfer or purported transfer of any Security
not made in accordance with this Declaration shall be null and void.
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(b) Subject to this Article IX, Preferred Securities shall be freely
transferable.
(c) Subject to this Article IX, the Sponsor and any Related Party
may only transfer Common Securities to the Sponsor or a Related Party of the
Sponsor; provided that, any such transfer is subject to the condition precedent
that the transferor obtain the written opinion of nationally recognized
independent counsel experienced in such matters that such transfer would not
cause more than an insubstantial risk that:
(i) the Trust would not be classified for United States federal
income tax purposes as a grantor trust; and
(ii) the Trust would be an Investment Company or the transferee
would become an Investment Company.
SECTION 9.2 Transfer of Certificates.
The Regular Trustees shall provide for the registration of
Certificates and of transfers of Certificates, which will be effected without
charge but only upon payment (with such indemnity as the Regular Trustees may
require) in respect of any tax or other government charges that may be imposed
in relation to it. Upon surrender for registration of transfer of any
Certificate, the Regular Trustees shall cause one or more new Certificates to be
issued in the name of the designated transferee or transferees. Every
Certificate surrendered for registration of transfer shall be accompanied by a
written instrument of transfer in form satisfactory to the Regular Trustees duly
executed by the Holder or such Holder's attorney duly authorized in writing.
Each Certificate surrendered for registration of transfer shall be canceled by
the Regular Trustees. A transferee of a Certificate shall be entitled to the
rights and subject to the obligations of a Holder hereunder upon the receipt by
such transferee of a Certificate. By acceptance of a Certificate, each
transferee shall be deemed to have agreed to be bound by this Declaration.
SECTION 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any Certificate
shall be registered on the books and records of the Trust as the sole holder of
such Certificate and of the Securities represented by such Certificate for
purposes of receiving Distributions and for all other purposes whatsoever and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Certificate or in the Securities represented by such
Certificate on the part of any Person, whether or not the Trust shall have
actual or other notice thereof.
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SECTION 9.4 Book Entry Interests.
Unless otherwise specified in the terms of the Preferred Securities,
the Preferred Securities Certificates, on original issuance, will be issued in
the form of one or more, fully registered, global Preferred Security
Certificates (each a "Global Certificate"), to be delivered to DTC, the initial
Clearing Agency, by, or on behalf of, the Trust. Such Global Certificates shall
initially be registered on the books and records of the Trust in the name of
Cede & Co., the nominee of DTC, and no Preferred Security Beneficial Owner will
receive a definitive Preferred Security Certificate representing such Preferred
Security Beneficial Owner's interests in such Global Certificates, except as
provided in Section 9.7. Unless and until definitive, fully registered Preferred
Security Certificates (the "Definitive Preferred Security Certificates") have
been issued to the Preferred Security Beneficial Owners pursuant to Section 9.7:
(a) the provisions of this Section 9.4 shall be in full force and
effect;
(b) the Trust and the Trustees shall be entitled to deal with the
Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Certificates and receiving
approvals, votes or consents hereunder) as the Holder of the Preferred
Securities and the sole holder of the Global Certificates and shall have
no obligation to the Preferred Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.4 conflict
with any other provisions of this Declaration, the provisions of this
Section 9.4 shall control; and
(d) the rights of the Preferred Security Beneficial Owners shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Preferred Security
Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants and receive and transmit payments of Distributions on the
Global Certificates to such Clearing Agency Participants. DTC will make
book entry transfers among the Clearing Agency Participants.
SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Preferred Security
Holders is required under this Declaration, unless and until Definitive
Preferred Security Certificates shall have been issued to the Preferred Security
Beneficial Owners pursuant to Section 9.7, the Regular Trustees shall give all
such notices and communications specified herein to be given to the Preferred
Security Holders to the Clearing Agency, and shall have no notice obligations to
the Preferred Security Beneficial Owners.
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SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred Securities, the Regular
Trustees may, in their sole discretion, appoint a successor Clearing Agency with
respect to such Preferred Securities.
SECTION 9.7 Definitive Preferred Security Certificates.
If:
(a) a Clearing Agency elects to discontinue its services as
securities depositary with respect to the Preferred Securities and a
successor Clearing Agency is not appointed within 90 days after such
discontinuance pursuant to Section 9.6; or
(b) the Regular Trustees elect after consultation with the Sponsor
to terminate the book entry system through the Clearing Agency with
respect to the Preferred Securities,
then:
(c) Definitive Preferred Security Certificates shall be prepared by
the Regular Trustees on behalf of the Trust with respect to such Preferred
Securities; and
(d) upon surrender of the Global Certificates by the Clearing
Agency, accompanied by registration instructions, the Regular Trustees
shall cause Definitive Certificates to be delivered to Preferred Security
Beneficial Owners in accordance with the instructions of the Clearing
Agency. Neither the Trustees nor the Trust shall be liable for any delay
in delivery of such instructions and each of them may conclusively rely on
and shall be protected in relying on, said instructions of the Clearing
Agency. The Definitive Preferred Security Certificates shall be printed,
lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as evidenced by their
execution thereof, and may have such letters, numbers or other marks of
identification or designation and such legends or endorsements as the
Regular Trustees may deem appropriate, or as may be required to comply
with any law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any stock exchange on which Preferred Securities
may be listed, or to conform to usage.
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SECTION 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.
If:
(a) any mutilated Certificates should be surrendered to the Regular
Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such security
or indemnity as may be required by them to keep each of them harmless.
then, in the absence of notice that such Certificate shall have been acquired by
a bona fide purchaser, any Regular Trustee on behalf of the Trust shall execute
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Certificate, a new Certificate of like denomination. In connection
with the issuance of any new Certificate under this Section 9.8, the Regular
Trustees may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith. Any duplicate
Certificate issued pursuant to this Section shall constitute conclusive evidence
of an ownership interest in the relevant Securities, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at any
time.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration, the Preferred
Securities Guarantee and the terms of the Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion of the capital
contributions (or any return thereon) of the Holders of the Securities
which shall be made solely from assets of the Trust; and
(ii) required to pay to the Trust or to any Holder of Securities any
deficit upon dissolution of the Trust or otherwise.
(b) The Holder of the Common Securities shall be liable for all of
the debts and obligations of the Trust (other than with respect to the
Securities) to the extent not satisfied out of the Trust's assets.
(c) Pursuant to ss. 3803(a) of the Business Trust Act, the Holders
of the Preferred Securities shall be entitled to the same limitation of personal
liability extended to
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stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.
SECTION 10.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's gross negligence or
willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in
good faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Trust, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Securities might properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person
has duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Institutional Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between any
Covered Persons; or
(ii) whenever this Declaration or any other agreement contemplated
herein or therein provides that an Indemnified Person shall act in a
manner that is, or provides terms that are, fair and reasonable to the
Trust or any Holder of Securities,
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the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted
or required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have no duty
or obligation to give any consideration to any interest of or factors
affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Declaration or
by applicable law.
SECTION 10.4 Indemnification.
(a) (i) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Trust) by reason of the fact
that he is or was a Company Indemnified Person against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Trust, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the Company Indemnified Person
did not act in good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his conduct
was unlawful.
(ii) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company
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Indemnified Person against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or settlement of such
action or suit if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the Trust and except that no
such indemnification shall be made in respect of any claim, issue or matter as
to which such Company Indemnified Person shall have been adjudged to be liable
to the Trust unless and only to the extent that the Court of Chancery of
Delaware or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which such Court of Chancery or such other court
shall deem proper.
(iii) To the extent that a Company Indemnified Person shall be
successful on the merits or otherwise (including dismissal of an action without
prejudice or the settlement of an action without admission of liability) in
defense of any action, suit or proceeding referred to in paragraphs (i) and (ii)
of this Section 10.4(a), or in defense of any claim, issue or matter therein, he
shall be indemnified, to the full extent permitted by law, against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
(iv) Any indemnification under paragraphs (i) and (ii) of this
Section 10.4(a) (unless ordered by a court) shall be made by the Debenture
Issuer only as authorized in the specific case upon a determination that
indemnification of the Company Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set forth in paragraphs
(i) and (ii). Such determination shall be made (1) by the Regular Trustees by a
majority vote of a quorum consisting of such Regular Trustees who were not
parties to such action, suit or proceeding, (2) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested Regular
Trustees so directs, by independent legal counsel in a written opinion, or (3)
by the Common Security Holder of the Trust.
(v) Expenses (including attorneys' fees) incurred by a Company
Indemnified Person in defending a civil, criminal, administrative or
investigative action, suit or proceeding referred to in paragraphs (i) and (ii)
of this Section 10.4(a) shall be paid by the Debenture Issuer in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such Company Indemnified Person to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Debenture Issuer as authorized in this Section 10.4(a).
Notwithstanding the foregoing, no advance shall be made by the Debenture Issuer
if a determination is reasonably and promptly made (i) by the Regular Trustees
by a majority vote of a quorum of disinterested Regular Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum of disinterested
Regular Trustees so directs, by independent legal counsel in a written opinion
or (iii) the Common Security Holder of the Trust, that, based upon the facts
known to the Regular Trustees, counsel or the Common Security Holder at the time
such determination is made, such Company Indemnified Person acted in bad faith
or in a manner that such person
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did not believe to be in or not opposed to the best interests of the Trust, or,
with respect to any criminal proceeding, that such Company Indemnified Person
believed or had reasonable cause to believe his conduct was unlawful. In no
event shall any advance be made in instances where the Regular Trustees,
independent legal counsel or Common Security Holder reasonably determine that
such person deliberately breached his duty to the Trust or its Common or
Preferred Security Holders.
(vi) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other paragraphs of this Section 10.4(a) shall not be
deemed exclusive of any other rights to which those seeking indemnification and
advancement of expenses may be entitled under any agreement, vote of
stockholders or disinterested directors of the Debenture Issuer or Preferred
Security Holders of the Trust or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office. All
rights to indemnification under this Section 10.4(a) shall be deemed to be
provided by a contract between the Debenture Issuer and each Company Indemnified
Person who serves in such capacity at any time while this Section 10.4(a) is in
effect. Any repeal or modification of this Section 10.4(a) shall not affect any
rights or obligations then existing.
(vii) The Debenture Issuer may purchase and maintain insurance on
behalf of any person who is or was a Company Indemnified Person against any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the Debenture Issuer would
have the power to indemnify him against such liability under the provisions of
this Section 10.4(a).
(viii) For purposes of this Section 10.4(a), references to "the
Trust" shall include, in addition to the resulting or surviving entity, any
constituent entity (including any constituent of a constituent) absorbed in a
consolidation or merger, so that any person who is or was a director, trustee,
officer or employee of such constituent entity, or is or was serving at the
request of such constituent entity as a director, trustee, officer, employee or
agent of another entity, shall stand in the same position under the provisions
of this Section 10.4(a) with respect to the resulting or surviving entity as he
would have with respect to such constituent entity if its separate existence had
continued.
(ix) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Section 10.4(a) shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a Company
Indemnified Person and shall inure to the benefit of the heirs, executors and
administrators of such a person.
(b) The Debenture Issuer agrees to indemnify the (i) Institutional
Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the Institutional
Trustee and the Delaware Trustee, and (iv) any officers, directors,
shareholders, members, partners, employees, representatives, custodians,
nominees or agents of the Institutional Trustee and the Delaware Trustee (each
of the Persons in (i) through (iv) being referred to as a "Fiduciary Indemnified
Person") for, and to hold each Fiduciary Indemnified Person harmless against,
any loss,
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liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration or the
trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against or investigating
any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder. The obligation to indemnify as set forth in this
Section 10.4(b) shall survive the satisfaction and discharge of this
Declaration.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the
Institutional Trustee may engage in or possess an interest in other business
ventures of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom, and the pursuit
of any such venture, even if competitive with the business of the Trust, shall
not be deemed wrongful or improper. No Covered Person, the Sponsor, the Delaware
Trustee, or the Institutional Trustee shall be obligated to present any
particular investment or other opportunity to the Trust even if such opportunity
is of a character that, if presented to the Trust, could be taken by the Trust,
and any Covered Person, the Sponsor, the Delaware Trustee and the Institutional
Trustee shall have the right to take for its own account (individually or as a
partner or fiduciary) or to recommend to others any such particular investment
or other opportunity. Any Covered Person, the Delaware Trustee and the
Institutional Trustee may engage or be interested in any financial or other
transaction with the Sponsor or any Affiliate of the Sponsor, or may act as
depositary for, trustee or agent for, or act on any committee or body of holders
of, securities or other obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the calendar
year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Regular
Trustees shall keep, or cause to be kept, full books of account, records and
supporting documents, which shall reflect in reasonable detail, each transaction
of the Trust. The books of account shall be maintained on the accrual method of
accounting, in accordance with generally accepted accounting principles,
consistently applied. The Trust shall use the accrual method of accounting for
United States federal income tax purposes. The books of account and the
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records of the Trust shall be examined by and reported upon as of the end of
each Fiscal Year of the Trust by a firm of independent certified public
accountants selected by the Regular Trustees.
(b) The Regular Trustees shall cause to be prepared and delivered to
each of the Holders of Securities, within 90 days after the end of each Fiscal
Year of the Trust, annual financial statements of the Trust, including a balance
sheet of the Trust as of the end of such Fiscal Year, and the related statements
of income or loss;
(c) The Regular Trustees shall cause to be duly prepared and
delivered to each of the Holders of Securities, any annual United States federal
income tax information statement, required by the Code, containing such
information with regard to the Securities held by each Holder as is required by
the Code and the Treasury Regulations. Notwithstanding any right under the Code
to deliver any such statement at a later date, the Regular Trustees shall
endeavor to deliver all such statements within 30 days after the end of each
Fiscal Year of the Trust.
(d) The Regular Trustees shall cause to be duly prepared and filed
with the appropriate taxing authority, an annual United States federal income
tax return, on a Form 1041 or such other form required by United States federal
income tax law, and any other annual income tax returns required to be filed by
the Regular Trustees on behalf of the Trust with any state or local taxing
authority.
SECTION 11.3 Banking.
The Trust shall maintain one or more bank accounts in the name and
for the sole benefit of the Trust; provided, however, that all payments of funds
in respect of the Debentures held by the Institutional Trustee shall be made
directly to the Institutional Trustee Account and no other funds of the Trust
shall be deposited in the Institutional Trustee Account. The sole signatories
for such accounts shall be designated by the Regular Trustees; provided,
however, that the Institutional Trustee shall designate the signatories for the
Institutional Trustee Account.
SECTION 11.4 Withholding.
The Trust and the Regular Trustees shall comply with all withholding
requirements under United States federal, state and local law. The Trust shall
request, and the Holders shall provide to the Trust, such forms or certificates
as are necessary to establish an exemption from withholding with respect to each
Holder, and any representations and forms as shall reasonably be requested by
the Trust to assist it in determining the extent of, and in fulfilling, its
withholding obligations. The Regular Trustees shall file required forms with
applicable jurisdictions and, unless an exemption from withholding is properly
established by a Holder, shall remit amounts withheld with respect to the Holder
to applicable jurisdictions. To the extent that the Trust is required to
withhold and pay over
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any amounts to any authority with respect to distributions or allocations to any
Holder, the amount withheld shall be deemed to be a distribution in the amount
of the withholding to the Holder. In the event of any claimed overwithholding,
Holders shall be limited to an action against the applicable jurisdiction. If
the amount required to be withheld was not withheld from actual Distributions
made, the Trust may reduce subsequent Distributions by the amount of such
withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may only be amended by a
written instrument approved and executed by:
(i) the Regular Trustees (or, if there are more than two Regular
Trustees a majority of the Regular Trustees);
(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Institutional Trustee, the Institutional
Trustee; and
(iii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, the Delaware Trustee;
(b) no amendment shall be made, and any such purported amendment
shall be void and ineffective:
(i) unless, in the case of any proposed amendment, the Institutional
Trustee shall have first received an Officers' Certificate from each of
the Trust and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the terms of the
Securities);
(ii) unless, in the case of any proposed amendment which affects the
rights, powers, duties, obligations or immunities of the Institutional
Trustee, the Institutional Trustee shall have first received:
(A) an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Securities);
and
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(B) an opinion of counsel (who may be counsel to the Sponsor
or the Trust) that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the
Securities); and
(iii) to the extent the result of such amendment would be to:
(A) cause the trust to fail to continue to be classified for
purposes of United States federal income taxation as a grantor
trust;
(B) reduce or otherwise adversely affect the powers of the
Institutional Trustee in contravention of the Trust Indenture Act;
or
(C) cause the Trust to be deemed to be an Investment Company
required to be registered under the Investment Company Act;
(c) at such time after the Trust has issued any Securities that
remain outstanding, any amendment that would adversely affect the rights,
privileges or preferences of any Holder of Securities may be effected only with
such additional requirements as may be set forth in the terms of such
Securities;
(d) Section 9.1(c) and this Section 12.1 shall not be amended
without the consent of all of the Holders of the Securities;
(e) Article IV shall not be amended without the consent of the
Holders of a Majority in liquidation amount of the Common Securities and;
(f) the rights of the Holders of the Common Securities under Article
V to increase or decrease the number of, and appoint and remove Trustees shall
not be amended without the consent of the Holders of a Majority in liquidation
amount of the Common Securities; and
(g) subject to Section 12.1(c), this Declaration may be amended
without the consent of the Holders of the Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this Declaration that
may be defective or inconsistent with any other provision of this
Declaration;
(iii) add to the covenants, restrictions or obligations of the
Sponsor;
(iv) to conform to any change in Rule 3a-5 or written change in
interpretation or application of Rule 3a-5 by any legislative body, court,
government
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agency or regulatory authority which amendment does not have a material
adverse effect on the right, preferences or privileges of the Holders; and
(v) to modify, eliminate and add to any provision of the Declaration
to such extent as may be reasonably necessary to effectuate any of the
foregoing or to
otherwise comply with applicable law.
SECTION 12.2 Meetings of the Holders of Securities; Action by Written
Consent.
(a) Meetings of the Holders of any class of Securities may be called
at any time by the Regular Trustees (or as provided in the terms of the
Securities) to consider and act on any matter on which Holders of such class of
Securities are entitled to act under the terms of this Declaration, the terms of
the Securities or the rules of any stock exchange on which the Preferred
Securities are listed or admitted for trading. The Regular Trustees shall call a
meeting of the Holders of such class if directed to do so by the Holders of
Securities representing at least 10% in liquidation amount of such class of
Securities. Such direction shall be given by delivering to the Regular Trustees
one or more calls in a writing stating that the signing Holders of Securities
wish to call a meeting and indicating the general or specific purpose for which
the meeting is to be called. Any Holders of Securities calling a meeting shall
specify in writing the Security Certificates held by the Holders of Securities
exercising the right to call a meeting and only those Securities specified shall
be counted for purposes of determining whether the required percentage set forth
in the second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:
(i) notice of any such meeting shall be given to all the Holders of
Securities having a right to vote thereat at least 7 days and not more
than 60 days before the date of such meeting. Whenever a vote, consent or
approval of the Holders of Securities is permitted or required under this
Declaration or the rules of any stock exchange on which the Preferred
Securities are listed or admitted for trading, such vote, consent or
approval may be given at a meeting of the Holders of Securities. Any
action that may be taken at a meeting of the Holders of Securities may be
taken without a meeting if a consent in writing setting forth the action
so taken is signed by the Holders of Securities owning not less than the
minimum amount of Securities in liquidation amount that would be necessary
to authorize or take such action at a meeting at which all Holders of
Securities having a right to vote thereon were present and voting. Prompt
notice of the taking of action without a meeting shall be given to the
Holders of Securities entitled to vote who have not consented in writing.
The Regular Trustees may specify that any written ballot submitted to the
Security Holder for the purpose of taking any action without a meeting
shall be returned to the Trust within the time specified by the Regular
Trustees;
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(ii) each Holder of a Security may authorize any Person to act for
it by proxy on all matters in which a Holder of Securities is entitled to
participate, including waiving notice of any meeting, or voting or
participating at a meeting. No proxy shall be valid after the expiration
of 11 months from the date thereof unless otherwise provided in the proxy.
Every proxy shall be revocable at the pleasure of the Holder of Securities
executing it. Except as otherwise provided herein, all matters relating to
the giving, voting or validity of proxies shall be governed by the General
Corporation Law of the State of Delaware relating to proxies, and judicial
interpretations thereunder, as if the Trust were a Delaware corporation
and the Holders of the Securities were stockholders of a Delaware
corporation;
(iii) each meeting of the Holders of the Securities shall be
conducted by the Regular Trustees or by such other Person that the Regular
Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration, the terms of
the Securities, the Trust Indenture Act or the listing rules of any stock
exchange on which the Preferred Securities are then listed or trading,
otherwise provides, the Regular Trustees, in their sole discretion, shall
establish all other provisions relating to meetings of Holders of
Securities, including notice of the time, place or purpose of any meeting
at which any matter is to be voted on by any Holders of Securities, waiver
of any such notice, action by consent without a meeting, the establishment
of a record date, quorum requirements, voting in person or by proxy or any
other matter with respect to the exercise of any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF INSTITUTIONAL TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Institutional Trustee.
The Trustee that acts as initial Institutional Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Institutional Trustee represents and warrants to the Trust
and the Sponsor at the time of the Successor Institutional Trustee's acceptance
of its appointment as Institutional Trustee that:
(a) the Institutional Trustee is a national banking association with
trust powers, duly organized, validly existing and in good standing under
the laws of the United States, with trust power and authority to execute
and deliver, and to carry out and perform its obligations under the terms
of, the Declaration;
(b) the execution, delivery and performance by the Institutional
Trustee of the Declaration has been duly authorized by all necessary
corporate action on the
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part of the Institutional Trustee. The Declaration has been duly executed
and delivered by the Institutional Trustee, and it constitutes a legal,
valid and binding obligation of the Institutional 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 execution, delivery and performance of the Declaration by
the Institutional Trustee does not conflict with or constitute a breach of
the Articles of Organization or By-laws of the Institutional Trustee; and
(d) no consent, approval or authorization of, or registration with
or notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Institutional Trustee, of the
Declaration.
SECTION 13.2 Representations and Warranties of Delaware Trustee.
The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
(a) The Delaware Trustee is a Delaware banking corporation with
trust powers, duly organized, validly existing and in good standing 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 Declaration.
(b) The Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and the Declaration. The
Declaration under Delaware law constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance
with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' rights
generally and to general principles of equity and the discretion of the
court (regardless of whether the enforcement of such remedies is
considered in a proceeding in equity or at law).
(c) No consent, approval or authorization of, or registration with
or notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Delaware Trustee, of the
Declaration.
(d) The Delaware Trustee is a Delaware banking corporation with
trust powers, duly organized, validly existing and in good standing under
the laws of the
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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
Declaration.
(e) No consent, approval or authorization of, or registration with
or notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Delaware Trustee of the
Declaration.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices.
All notices provided for in this Declaration shall be in writing,
duly signed by the party giving such notice, and shall be delivered, telecopied
or mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the
Trust's mailing address set forth below (or such other address as the
Trust may give notice of to the Holders of the Securities):
Travelers Capital VII
c/o Travelers Group Inc.
388 Greenwich Street
New York, New York 10013
Attention: Heidi G. Miller
Irwin Ettinger
(b) if given to the Delaware Trustee, at the mailing address set
forth below (or such other address as Delaware Trustee may give notice of
to the Holders of the Securities):
Chase Manhattan Bank Delaware
1201 Market Street
Wilmington, Delaware 19801
(c) if given to the Institutional Trustee, at its Corporate Trust
Office to the attention of The Institutional Trust Group (or such other
address as the Institutional Trustee may give notice of to the Holders of
the Securities):
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(d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice of to the Trust):
Travelers Group Inc.
388 Greenwich Street
New York, New York 10013
Attention: Charles O. Prince, III, Secretary
(e) if given to any other Holder, at the address set forth on the
books and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 14.2 Governing Law.
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted in accordance with the laws of the State of Delaware
and all rights and remedies shall be governed by such laws without regard to
principles of conflict of laws.
SECTION 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be
classified for United States federal income tax purposes as a grantor trust. The
provisions of this Declaration shall be interpreted to further this intention of
the parties.
SECTION 14.4 Headings.
Headings contained in this Declaration are inserted for convenience
of reference only and do not affect the interpretation of this Declaration or
any provision hereof.
SECTION 14.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
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SECTION 14.6 Partial Enforceability.
If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the remainder of
this Declaration, or the application of such provision to persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 14.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
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IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.
-------------------------------
Heidi G. Miller, as Regular Trustee
-------------------------------
Irwin Ettinger, as Regular Trustee
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By:
------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as
Institutional Trustee
By:
------------------------
Name:
Title:
TRAVELERS GROUP INC., as Sponsor
By:
------------------------
Name:
Title:
<PAGE>
ANNEX I
TERMS OF
[ ]% TRUST PREFERRED SECURITIES
[ ]% TRUST COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated Declaration of
Trust, dated as of [ ], 199 (as amended from time to time, the "Declaration"),
the designation, rights, privileges, restrictions, preferences and other terms
and provisions of the Preferred Securities and the Common Securities are set out
below (each capitalized term used but not defined herein has the meaning set
forth in the Declaration or, if not defined in such Declaration, as defined in
the Prospectus referred to below):
1. Designation and Number.
(a) Preferred Securities. [ ] Preferred Securities of the Trust with
an aggregate liquidation amount with respect to the assets of the Trust of
million dollars ($[ ]), plus up to an additional ______ Preferred Securities of
the Trust with an aggregate liquidation amount with respect to the assets of the
Trust of __________ ($________) solely to cover over-allotments, as provided for
in the Underwriting Agreement and a liquidation amount with respect to the
assets of the Trust of $25 per preferred security, are hereby designated for the
purposes of identification only as "[ ]% Trust Preferred Securities" (the
"Preferred Securities"). The Preferred Security Certificates evidencing the
Preferred Securities shall be substantially in the form of Exhibit A-1 to the
Declaration, with such changes and additions thereto or deletions therefrom as
may be required by ordinary usage, custom or practice or to conform to the rules
of any stock exchange on which the Preferred Securities are listed.
(b) Common Securities. [ ] Common Securities of the Trust with an
aggregate liquidation amount with respect to the assets of the Trust of dollars
($[ ]) (_________ ($_________) if the over-allotment option granted to the
underwriters pursuant to the Underwriting Agreement is exercised in full) and a
liquidation amount with respect to the assets of the Trust of $25 per common
security, are hereby designated for the purposes of identification only as "[ ]%
Trust Common Securities" (the "Common Securities"). The Common Security
Certificates evidencing the Common Securities shall be substantially in the form
of Exhibit A-2 to the Declaration, with such changes and additions thereto or
deletions therefrom as may be required by ordinary usage, custom or practice.
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2. Distributions.
(a) Distributions payable on each Security will be fixed at a rate
per annum of [ ]% (the "Coupon Rate") of the stated liquidation amount of $25
per Security, such rate being the rate of interest payable on the Debentures to
be held by the Institutional Trustee. Distributions in arrears beyond the first
date such Distributions are payable (or would be payable if not for any
Extension Period (as defined below) or default by the Debenture Issuer on the
Debentures) will bear interest thereon compounded quarterly at the Coupon Rate
(to the extent permitted by applicable law). The term "Distributions" as used
herein includes such cash distributions and any such interest payable unless
otherwise stated. A Distribution is payable only to the extent that payments are
made in respect of the Debentures held by the Institutional Trustee and to the
extent the Institutional Trustee has funds available therefor. The amount of
Distributions payable for any period will be computed for any full quarterly
Distribution period on the basis of a 360-day year of twelve 30-day months, and
for any period shorter than a full quarterly Distribution period for which
Distributions are computed, Distributions will be computed on the basis of the
actual number of days elapsed per 90-day quarter.
(b) Distributions on the Securities will be cumulative, will accrue
from and including [ ], 199 , and will be payable quarterly in arrears, on March
31, June 30, September 30, and December 31 of each year, commencing on [ ],
199__. When, as and if available for payment, Distributions will be made by the
Institutional Trustee, except as otherwise described below. The Debenture Issuer
has the right under the Indenture to defer payments of interest on the
Debentures by extending the interest payment period from time to time on the
Debentures for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), during which Extension Period no interest shall be due and
payable on the Debentures, provided that no Extension Period may extend beyond
the date of maturity of the Debentures. As a consequence of the Debenture
Issuer's extension of the interest payment period, Distributions will also be
deferred. Despite such deferral, quarterly Distributions will continue to accrue
with interest thereon (to the extent permitted by applicable law) at the Coupon
Rate compounded quarterly during any such Extension Period. In the event that
the Debenture Issuer exercises its right to extend the interest payment period,
then (a) the Debenture Issuer shall not declare or pay any dividend on, make any
distributions with respect to, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of its capital stock or make any
guarantee payment with respect thereto (other than (i) repurchases, redemptions
or other acquisitions of shares of capital stock of Travelers in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of employees, officers, directors or consultants, (ii) as a result
of an exchange or conversion of any class or series of Travelers's capital stock
for any other class or series of Travelers's capital stock, or (iii) the
purchase of fractional interests in shares of Travelers's capital stock pursuant
to the conversion or exchange provisions of such capital stock or the security
being converted or exchanged) and (b) the Debenture Issuer shall not make any
payment of interest on or principal of (or premium, if any, on), or repay,
repurchase or redeem, any debt securities issued by the
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Debenture Issuer that rank pari passu with or junior to the Debentures. The
foregoing, however, will not apply to any stock dividends paid by Travelers
where the dividend stock is the same stock as that on which the dividend is
being paid. Prior to the termination of any such Extension Period, the Debenture
Issuer may further extend such Extension Period; provided that such Extension
Period, together with all such previous and further extensions thereof, may not
exceed 20 consecutive quarters; provided further, that no Extension Period may
extend beyond the maturity of the Debentures. Payments of accrued Distributions
will be payable to Holders as they appear on the books and records of the Trust
on the first record date after the end of the Extension Period. Upon the
termination of any Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the above
requirements. The Regular Trustees will give notice to each Holder of any
Extension Period upon their receipt of notice thereof from the Debenture Issuer.
(c) Distributions on the Securities will be payable to the Holders
thereof as they appear on the books and records of the Trust at the close of
business on the relevant record dates. While the Preferred Securities remain in
book-entry only form, the relevant record dates shall be one Business Day prior
to the relevant payment dates which payment dates shall correspond to the
interest payment dates on the Debentures. Subject to any applicable laws and
regulations and the provisions of the Declaration, each such payment in respect
of the Preferred Securities will be made as described under the heading
"Description of the Preferred Securities -- Book-Entry Only Issuance -- The
Depository Trust Company" in the Prospectus Supplement dated [ ], 199__, (the
"Prospectus Supplement") to the Prospectus dated [ ], 199__ (together, the
"Prospectus"), of the Trust included in the Registration Statement on Form S-3
of the Sponsor, the Trust and certain other business trusts. The relevant record
dates for the Common Securities shall be the same record date as for the
Preferred Securities. If the Preferred Securities shall not continue to remain
in book-entry only form, the relevant record dates for the Preferred Securities
shall conform to the rules of any securities exchange on which the securities
are listed and, if none, shall be selected by the Regular Trustees, which dates
shall be at least 14 days but no more than 60 days before the relevant payment
dates, which payment dates shall correspond to the interest payment dates on the
Debentures. Distributions payable on any Securities that are not punctually paid
on any Distribution payment date, as a result of the Debenture Issuer having
failed to make a payment under the Debentures, will cease to be payable to the
Person in whose name such Securities are registered on the relevant record date,
and such defaulted Distribution will instead be payable to the Person in whose
name such Securities are registered on the special record date or other
specified date determined in accordance with the Indenture. If any date on which
Distributions are payable on the Securities is not a Business Day, then payment
of the Distribution payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay) except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on such date.
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(d) In the event that there is any money or other property held by
or for the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata (as defined herein) among the Holders of the Securities.
3. Liquidation Distribution Upon Dissolution.
In the event of any voluntary or involuntary dissolution, winding-up
or termination of the Trust, the Holders of the Securities on the date of the
dissolution, winding-up or termination, as the case may be, will be entitled to
receive out of the assets of the Trust available for distribution to Holders of
Securities after satisfaction of liabilities of creditors, distributions in an
amount equal to the aggregate of the stated liquidation amount of $25 per
Security plus accrued and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution"), unless, in connection with
such dissolution, winding-up or termination, Debentures in an aggregate
principal amount equal to the aggregate stated liquidation amount of, with an
interest rate equal to the Coupon Rate, and bearing accrued and unpaid interest
in an amount equal to the accrued and unpaid Distributions on, such Securities
outstanding at such time, have been distributed on a Pro Rata basis to the
Holders of the Securities in exchange for such Securities.
If, upon any such dissolution, the Liquidation Distribution can be
paid only in part because the Trust has insufficient assets available to pay in
full the aggregate Liquidation Distribution, then the amounts payable directly
by the Trust on the Securities shall be paid on a Pro Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole or in part,
whether at maturity or upon redemption (either at the option of the Debenture
Issuer or pursuant to a Special Event as described below), the proceeds from
such repayment or payment shall be simultaneously applied to redeem Securities
having an aggregate liquidation amount equal to the aggregate principal amount
of the Debentures so repaid or redeemed at a redemption price of $25 per
Security plus an amount equal to accrued and unpaid Distributions thereon at the
date of the redemption, payable in cash (the "Redemption Price"). Holders shall
be given not less than 30 nor more than 60 days notice of such redemption.
(b) If fewer than all the outstanding Securities are to be so
redeemed, the Securities will be redeemed Pro Rata and the Preferred Securities
to be redeemed will be as described in Section 4(f)(ii) below.
(c) If, at any time, a Tax Event or an Investment Company Event
(each as defined below, and each a "Special Event") shall occur and be
continuing, the Regular Trustees shall, except in certain limited circumstances
in relation to a Tax Event described in this Section 4(c), dissolve the Trust
and, after satisfaction of creditors, cause Debentures held by the Institutional
Trustee, having an aggregate principal amount equal to the aggregate
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stated liquidation amount of, with an interest rate identical to the Coupon
Rate, and with accrued and unpaid interest equal to accrued and unpaid
Distributions on, the Securities outstanding at such time, to be distributed to
the Holders of the Securities in liquidation of such Holders' interests in the
Trust on a Pro Rata basis, within 90 days following the occurrence of such
Special Event (the "90 Day Period"); provided, however, that, in the case of the
occurrence of a Tax Event, such dissolution and distribution shall be
conditioned on the Regular Trustees' receipt of an opinion of a nationally
recognized independent tax counsel experienced in such matters (a "No
Recognition Opinion"), which opinion may rely on published revenue rulings of
the Internal Revenue Service, to the effect that the Holders of the Securities
will not recognize any gain or loss for United States federal income tax
purposes as a result of such dissolution and distribution of Debentures, and
provided further, that, if at the time there is available to the Debenture
Issuer or the Trust the opportunity to eliminate, within the 90 Day Period, the
Special Event by taking some 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 Trust, the Debenture Issuer or the Holders of the
Securities ("Ministerial Action"), the Debenture Issuer or the Trust will pursue
such Ministerial Action in lieu of dissolution.
If in the case of the occurrence of a Tax Event, (i) the Debenture
Issuer has received an opinion (a "Redemption Tax Opinion") of a nationally
recognized independent tax counsel experienced in such matters that, as a result
of such Tax Event, there is more than an insubstantial risk that the Debenture
Issuer would be precluded from deducting the interest on the Debentures for
United States federal income tax purposes, even after the Debentures were
distributed to the Holders of Securities in liquidation of such Holders'
interests in the Trust as described in this Section 4(c), or (ii) the Regular
Trustees shall have been informed by such tax counsel that it cannot deliver a
No Recognition Opinion to the Regular Trustees, the Debenture Issuer shall have
the right, upon not less than 30 nor more than 60 days notice, to redeem the
Debentures, in whole or in part, for cash within 90 days following the
occurrence of such Tax Event, and, following such redemption, Securities with an
aggregate liquidation amount equal to the aggregate principal amount of the
Debentures so redeemed shall be redeemed by the Trust at the Redemption Price on
a Pro Rata basis; provided, however, that if at the time there is available to
the Debenture Issuer or the Trust the opportunity to eliminate, within such 90
day period, the Tax Event by taking some Ministerial Action, the Trust or the
Debenture Issuer will pursue such Ministerial Action in lieu of redemption.
"Tax Event" means that the Regular Trustees shall have received an
opinion of a nationally recognized independent tax counsel experienced in such
matters (a "Tax Event Opinion") to the effect that, as a result of (a) 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 (b) any amendment to, or
change in, an interpretation or application of such laws or regulations by any
legislative body, court, governmental agency or regulatory authority (including
the enactment of any legislation and the publication of any judicial decision or
regulatory
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determination on or after the date of the Prospectus Supplement), in either case
after the date of the Prospectus Supplement, there is more than an insubstantial
risk that (i) the Trust would be subject to United States federal income tax
with respect to interest accrued or received on the Debentures, (ii) the Trust
would be subject to more than a de minimis amount of other taxes, duties or
other governmental charges, or (iii) interest payable to the Trust on the
Debentures would not be deductible, in whole or in part, by the Debenture Issuer
for United States federal income tax purposes.
"Investment Company Event" means that the Regular Trustees shall
have received an opinion of a nationally recognized independent counsel
experienced in practice under the Investment Company Act (an "Investment Company
Event Opinion") to the effect that, as a result of the occurrence of a change in
law or regulation or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law"), there is a more than an insubstantial
risk that the Trust is or will be considered an Investment Company which is
required to be registered under the Investment Company Act, which Change in 1940
Act Law becomes effective on or after the date of the Prospectus Supplement.
On and from the date fixed by the Regular Trustees for any
distribution of Debentures and dissolution of the Trust: (i) the Securities will
no longer be deemed to be outstanding, (ii) DTC or its nominee (or any successor
Clearing Agency or its nominee), as the record Holder of the Preferred
Securities, will receive a registered global certificate or certificates
representing the Debentures to be delivered upon such distribution and (iii) any
certificates representing Securities, except for certificates representing
Preferred Securities held by DTC or its nominee (or any successor Clearing
Agency or its nominee), will be deemed to represent beneficial interests in the
Debentures having an aggregate principal amount equal to the aggregate stated
liquidation amount of, with an interest rate identical to the Coupon Rate of,
and accrued and unpaid interest equal to accrued and unpaid Distributions on
such Securities until such certificates are presented to the Debenture Issuer or
its agent for transfer or reissue.
(d) The Trust may not redeem fewer than all the outstanding
Securities unless all accrued and unpaid Distributions have been paid on all
Securities for all quarterly Distribution periods terminating on or before the
date of redemption.
(e) If the Debentures are distributed to Holders of the Securities,
pursuant to the terms of the Indenture, the Debenture Issuer will use its best
efforts to have the Debentures listed on the New York Stock Exchange or on such
other exchange as the Preferred Securities were listed immediately prior to the
distribution of the Debentures.
(f) Redemption or Distribution procedures will be as follows:
(i) Notice of any redemption of, or notice of distribution of
Debentures in exchange for the Securities (a "Redemption/Distribution
Notice") will be given by
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the Trust by mail to each Holder of Securities to be redeemed or exchanged
not fewer than 30 nor more than 60 days before the date fixed for
redemption or exchange thereof which, in the case of a redemption, will be
the date fixed for redemption of the Debentures. For purposes of the
calculation of the date of redemption or exchange and the dates on which
notices are given pursuant to this Section 4(f)(i), a Redemption/
Distribution Notice shall be deemed to be given on the day such notice is
first mailed by first-class mail, postage prepaid, to Holders of
Securities. Each Redemption/Distribution Notice shall be addressed to the
Holders of Securities at the address of each such Holder appearing in the
books and records of the Trust. No defect in the Redemption/Distribution
Notice or in the mailing of either thereof with respect to any Holder
shall affect the validity of the redemption or exchange proceedings with
respect to any other Holder.
(ii) In the event that fewer than all the outstanding Securities are
to be redeemed, the Securities to be redeemed shall be redeemed Pro Rata
from each Holder of Preferred Securities, it being understood that, in
respect of Preferred Securities registered in the name of and held of
record by DTC or its nominee (or any successor Clearing Agency or its
nominee) or any nominee, the distribution of the proceeds of such
redemption will be made to each Clearing Agency Participant (or Person on
whose behalf such nominee holds such securities) in accordance with the
procedures applied by such agency or nominee.
(iii) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice, which notice may only be issued if the
Debentures are redeemed as set out in this Section 4 (which notice will be
irrevocable), then (A) while the Preferred Securities are in book-entry
only form, with respect to the Preferred Securities, by 12:00 noon, New
York City time, on the redemption date, provided, that the Debenture
Issuer has paid the Institutional Trustee a sufficient amount of cash in
connection with the related redemption or maturity of the Debentures, the
Institutional Trustee will deposit irrevocably with DTC or its nominee (or
successor Clearing Agency or its nominee) funds sufficient to pay the
applicable Redemption Price with respect to the Preferred Securities and
will give DTC (or any successor Clearing Agency) irrevocable instructions
and authority to pay the Redemption Price to the Holders of the Preferred
Securities, and (B) with respect to Preferred Securities issued in
definitive form and Common Securities, provided that the Debenture Issuer
has paid the Institutional Trustee a sufficient amount of cash in
connection with the related redemption or maturity of the Debentures, the
Institutional Trustee will pay the relevant Redemption Price to the
Holders of such Securities by check mailed to the address of the relevant
Holder appearing on the books and records of the Trust on the redemption
date. If a Redemption/Distribution Notice shall have been given and funds
deposited as required, if applicable, then immediately prior to the close
of business on the date of such deposit, or on the redemption date, as
applicable, distributions will cease to accrue on the Securities so called
for redemption and all rights of Holders of such Securities so called for
redemption will
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cease, except the right of the Holders of such Securities to receive the
Redemption Price, but without interest on such Redemption Price. Neither
the Regular Trustees nor the Trust shall be required to register or cause
to be registered the transfer of any Securities that have been so called
for redemption. If any date fixed for redemption of Securities is not a
Business Day, then payment of the Redemption Price payable on such date
will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay) except
that, if such Business Day falls in the next calendar year, such payment
will be made on the immediately preceding Business Day, in each case with
the same force and effect as if made on such date fixed for redemption. If
payment of the Redemption Price in respect of any Securities is improperly
withheld or refused and not paid either by the Institutional Trustee or by
the Sponsor as guarantor pursuant to the relevant Securities Guarantee,
Distributions on such Securities will continue to accrue from the original
redemption date to the actual date of payment, in which case the actual
payment date will be considered the date fixed for redemption for purposes
of calculating the Redemption Price.
(iv) Redemption/Distribution Notices shall be sent by the Regular
Trustees on behalf of the Trust to (A) in respect of the Preferred
Securities, DTC or its nominee (or any successor Clearing Agency or its
nominee) if the Global Certificates have been issued or, if Definitive
Preferred Security Certificates have been issued, to the Holder thereof,
and (B) in respect of the Common Securities to the Holder thereof.
(v) Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws), the Debenture Issuer
or its affiliates may at any time and from time to time purchase
outstanding Preferred Securities by tender, in the open market or by
private agreement.
5. Voting Rights - Preferred Securities.
(a) Except as provided under Sections 5(b) and 7 and as otherwise
required by law and the Declaration, the Holders of the Preferred Securities
will have no voting rights.
(b) Subject to the requirements set forth in this paragraph, the
Holders of a Majority in aggregate liquidation amount of the Preferred
Securities, voting separately as a class, may direct the time, method, and place
of conducting any proceeding for any remedy available to the Institutional
Trustee, or direct the exercise of any trust or power conferred upon the
Institutional Trustee under the Declaration, including the right to direct the
Institutional Trustee, as holder of the Debentures, to (i) direct the time,
method and place of conducting any proceeding for any remedy available to the
Debenture Trustee, or exercise any trust or power conferred on the Debenture
Trustee with respect to the Debentures, (ii) waive any past Event of Default
that is waivable under Section 5.13 of the Indenture, (iii)
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exercise any right to rescind or annul a declaration that the principal of all
the Debentures shall be due and payable or (iv) consent to any amendment,
modification or termination of the Indenture or the Debentures where such
consent shall be required, provided, however, that, where a consent or action
under the Indenture would require the consent or act of each holder of each
Debenture affected thereby, such consent or action under the Indenture shall not
be effective until each Holder of Preferred Securities shall have consented to
such action or provided such consent. The Institutional Trustee shall not revoke
any action previously authorized or approved by a vote of the Holders of the
Preferred Securities. Except with respect to directing the time, method and
place of conducting a proceeding for a remedy available to the Institutional
Trustee, the Institutional Trustee, as holder of the Debentures, shall not take
any of the actions described in clauses (i), (ii), (iii) or (iv) above unless
the Institutional Trustee has obtained an opinion of a nationally recognized
independent tax counsel experienced in such matters to the effect that as a
result of such action, the Trust will not fail to be classified as a grantor
trust for United States federal income tax purposes. If the Institutional
Trustee fails to enforce its rights under the Debentures, any Holder of
Preferred Securities may directly institute a legal proceeding against the
Debenture Issuer to enforce the Institutional Trustee's rights under the
Debentures without first instituting a legal proceeding against the
Institutional Trustee or any other Person or entity. If a Declaration Event of
Default has occurred and is continuing and such event is attributable to the
failure of the Debenture Issuer to pay interest or principal on the Debentures
on the date such interest or principal is otherwise payable (or in the case of
redemption, on the redemption date), then a holder of Preferred Securities may
also directly institute a proceeding for enforcement of payment to such holder
(a "Direct Action") of the principal of or interest on the Debentures having a
principal amount equal to the aggregate liquidation amount of the Preferred
Securities of such holder on or after the respective due date specified in the
Debentures without first (i) directing the Institutional Trustee to enforce the
terms of the Debentures or (ii) instituting a legal proceeding directly against
the Debenture Issuer to enforce the Institutional Trustee's rights under the
Debentures. Except as provided in the preceding sentence, the Holders of
Preferred Securities will not be able to exercise directly any other remedy
available to the holders of the Debentures. In connection with such Direct
Action, Travelers will be subrogated to the rights of such holder of Preferred
Securities under the Declaration to the extent of any payment made by Travelers
to such holder of Preferred Securities in such Direct Action.
Any required approval or direction of Holders of Preferred
Securities may be given at a separate meeting of Holders of Preferred Securities
convened for such purpose, at a meeting of all of the Holders of Securities in
the Trust or pursuant to written consent. The Regular Trustees will cause a
notice of any meeting at which Holders of Preferred Securities are entitled to
vote, or of any matter upon which action by written consent of such Holders is
to be taken, to be mailed to each Holder of record of Preferred Securities. Each
such notice will include a statement setting forth (i) the date of such meeting
or the date by which such action is to be taken, (ii) a description of any
resolution proposed for adoption at such meeting on which such Holders are
entitled to vote or of such matter upon which written consent is sought and
(iii) instructions for the delivery of proxies or consents.
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No vote or consent of the Holders of the Preferred Securities will
be required for the Trust to redeem and cancel Preferred Securities or to
distribute the Debentures in accordance with this Declaration and the terms of
the Securities.
Notwithstanding that Holders of Preferred Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Preferred Securities that are owned by the Sponsor or any Affiliate of the
Sponsor shall not be entitled to vote or consent and shall, for purposes of such
vote or consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 6(b), (c) and 7 as otherwise
required by law and the Declaration, the Holders of the Common Securities will
have no voting rights.
(b) The Holders of the Common Securities are entitled, in accordance
with Article V of the Declaration, to vote to appoint, remove or replace any
Trustee or to increase or decrease the number of Trustees.
(c) Subject to Section 2.6 of the Declaration and only after the
Event of Default with respect to the Preferred Securities has been cured,
waived, or otherwise eliminated and subject to the requirements of the second to
last sentence of this paragraph, the Holders of a Majority in liquidation amount
of the Common Securities, voting separately as a class, may direct the time,
method, and place of conducting any proceeding for any remedy available to the
Institutional Trustee, or direct the exercise of any trust or power conferred
upon the Institutional Trustee under the Declaration, including (i) directing
the time, method, place of conducting any proceeding for any remedy available to
the Debenture Trustee, or exercising any trust or power conferred on the
Debenture Trustee with respect to the Debentures, (ii) waiving any past default
and its consequences that is waivable under Section 5.13 of the Indenture, or
(iii) exercising any right to rescind or annul a declaration that the principal
of all the Debentures shall be due and payable, provided that, where a consent
or action under the Indenture would require the consent or act of the Holders of
greater than a majority in principal amount of Debentures affected thereby (a
"Super Majority"), the Institutional Trustee may only give such consent or take
such action at the written direction of the Holders of at least the proportion
in liquidation amount of the Common Securities which the relevant Super Majority
represents of the aggregate principal amount of the Debentures outstanding.
Pursuant to this Section 6(c), the Institutional Trustee shall not revoke any
action previously authorized or approved by a vote of the Holders of the
Preferred Securities. Other than with respect to directing the time, method and
place of conducting any proceeding for any remedy available to the Institutional
Trustee or the Debenture Trustee as set forth above, the Institutional Trustee
shall not take any action in accordance with the directions of the Holders of
the Common Securities under this paragraph unless the Institutional Trustee has
obtained an opinion of tax counsel to the effect that for
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the purposes of United States federal income tax the Trust will not be
classified as other than a grantor trust on account of such action. If the
Institutional Trustee fails to enforce its rights under the Declaration, any
Holder of Common Securities may institute a legal proceeding directly against
any Person to enforce the Institutional Trustee's rights under the Declaration,
without first instituting a legal proceeding against the Institutional Trustee
or any other Person.
Any approval or direction of Holders of Common Securities may be
given at a separate meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Regular Trustees will cause a notice of any
meeting at which Holders of Common Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Common Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
the Debentures in accordance with the Declaration and the terms of the
Securities.
7. Amendments to Declaration and Indenture.
(a) In addition to any requirements under Section 12.1 of the
Declaration, if any proposed amendment to the Declaration provides for, or the
Regular Trustees otherwise propose to effect, (i) any action that would
adversely affect the powers, preferences or special rights of the Securities,
whether by way of amendment to the Declaration or otherwise, or (ii) the
dissolution, winding-up or termination of the Trust, other than as described in
Section 8.1 of the Declaration, then the Holders of outstanding Securities as a
class, will be entitled to vote on such amendment or proposal (but not on any
other amendment or proposal) and such amendment or proposal shall not be
effective except with the approval of the Holders of at least a Majority in
liquidation amount of the Securities, voting together as a single class;
provided, however, if any amendment or proposal referred to in clause (i) above
would adversely affect only the Preferred Securities or only the Common
Securities, then only the affected class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of a Majority in liquidation amount of such class of
Securities.
(b) In the event the consent of the Institutional Trustee as the
holder of the Debentures is required under the Indenture with respect to any
amendment, modification or termination on the Indenture or the Debentures, the
Institutional Trustee shall request the written direction of the Holders of the
Securities with respect to such amendment, modification or termination and shall
vote with respect to such amendment, modification or
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termination as directed by a Majority in liquidation amount of the Securities
voting together as a single class; provided, however, that where a consent under
the Indenture would require the consent of the holders of greater than a
majority in aggregate principal amount of the Debentures (a "Super Majority"),
the Institutional Trustee may only give such consent at the direction of the
Holders of at least the proportion in liquidation amount of the Securities which
the relevant Super Majority represents of the aggregate principal amount of the
Debentures outstanding; provided, further, that the Institutional Trustee shall
not take any action in accordance with the directions of the Holders of the
Securities under this Section 7(b) unless the Institutional Trustee has obtained
an opinion of tax counsel to the effect that for the purposes of United States
federal income tax the Trust will not be classified as other than a grantor
trust on account of such action.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
of Securities according to the aggregate liquidation amount of the Securities
held by the relevant Holder in relation to the aggregate liquidation amount of
all Securities outstanding unless, in relation to a payment, an Event of Default
under the Declaration has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the
Preferred Securities pro rata according to the aggregate liquidation amount of
Preferred Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggregate liquidation
amount of Common Securities held by the relevant Holder relative to the
aggregate liquidation amount of all Common Securities outstanding.
9. Ranking.
The Preferred Securities rank pari passu and payment thereon shall
be made Pro Rata with the Common Securities except that, where an Event of
Default occurs and is continuing under the Indenture in respect of the
Debentures held by the Institutional Trustee, the rights of Holders of the
Common Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to payment
of the Holders of the Preferred Securities.
10. Listing.
The Regular Trustees shall use their best efforts to cause the
Preferred Securities to be listed on the New York Stock Exchange, Inc.
11. Acceptance of Securities Guarantee and Indenture.
I-12
<PAGE>
Each Holder of Preferred Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee, including the subordination provisions therein and to the provisions
of the Indenture.
12. No Preemptive Rights.
The Holders of the Securities shall have no preemptive rights to
subscribe for any additional securities.
13. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration or the Preferred
Securities Guarantee, and the Indenture to a Holder without charge on written
request to the Sponsor at its principal place of business.
I-13
<PAGE>
EXHIBIT A-1
FORM OF PREFERRED SECURITY CERTIFICATE
THIS PREFERRED SECURITY IS A GLOBAL CERTIFICATE WITHIN THE MEANING
OF THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY (THE "DEPOSITARY") OR A NOMINEE OF THE DEPOSITARY. THIS
PREFERRED SECURITY IS EXCHANGEABLE FOR PREFERRED SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE DECLARATION AND NO TRANSFER OF THIS PREFERRED
SECURITY (OTHER THAN A TRANSFER OF THIS PREFERRED SECURITY AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN
LIMITED CIRCUMSTANCES.
UNLESS THIS PREFERRED SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW
YORK) TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY PREFERRED SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE &
CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
Certificate Number Number of Preferred Securities
CUSIP NO. _____________
Certificate Evidencing Preferred Securities
of
TRAVELERS Capital VII
[ ]% Trust Preferred Securities)
(Liquidation Amount $25 per Preferred Security)
TRAVELERS Capital VII, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that ___________
(the "Holder") is the registered owner of ________ (____) preferred securities
of the Trust representing undivided
I-1
<PAGE>
beneficial interests in the assets of the Trust designated the [ ]% Trust
Preferred Securities (the "Preferred Securities"). The Preferred Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities are set
forth in, and this certificate and the Preferred Securities represented hereby
are issued and shall in all respects be subject to, the provisions of the
Amended and Restated Declaration of Trust of the Trust dated as of [ ], 199 , as
the same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Preferred Securities as set forth in Annex I
thereto. Capitalized terms used herein but not defined shall have the meaning
given them in the Declaration. The Holder is entitled to the benefits of the
Preferred Securities Guarantee to the extent provided therein. The Sponsor will
provide a copy of the Declaration, the Preferred Securities Guarantee and the
Indenture to a Holder without charge upon written request to the Sponsor at its
principal place of business.
The Holder of this certificate, by accepting this certificate, is
deemed to have (i) agreed to the terms of the Indenture and the Debentures,
including that the Debentures are subordinate and junior in right of payment to
all Senior Indebtedness (as defined in the Indenture) and (ii) agreed to the
terms of the Preferred Securities Guarantee, including that the Preferred
Securities Guarantee is (A) subordinate and junior in right of payment to all
other liabilities of Travelers, (B) pari passu with the most senior preferred or
preference stock now or hereafter issued by Travelers and with any guarantee now
or hereafter issued by Travelers with respect to preferred or preference stock
of Travelers's affiliates and (C) senior to Travelers's common stock.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Preferred Securities
as evidence of indirect beneficial ownership in the Debentures.
A1-2
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate this ___
day of _______, ____.
-----------------------------------
Heidi G. Miller, as Trustee
-----------------------------------
Irwin Ettinger, as Trustee
A1-3
<PAGE>
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security Certificate to:
________________________________________________________________________________
________________________________________________________________________________
_______________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
_______________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
________________________________________________________________________________
________________________________________________________________________________
___________________________________________________________agent to transfer
this Preferred Security Certificate on the books of the Trust. The agent may
substitute another to act for him or her.
Date: _______________________
Signature: __________________
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
A1-4
<PAGE>
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
TRANSFER OF THIS CERTIFICATE
IS SUBJECT TO THE CONDITIONS
SET FORTH IN THE DECLARATION
REFERRED TO BELOW
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
TRAVELERS Capital VII
[ ]% Trust Common Securities
(Liquidation Amount $25 per Common Security)
TRAVELERS Capital VII, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that Travelers
Group Inc., a Delaware corporation, (the "Holder") is the registered owner of
__________ (________) common securities of the Trust representing undivided
beneficial interests in the assets of the Trust designated the [ ]% Trust Common
Securities (the "Common Securities"). The Common Securities are transferable on
the books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for transfer
and satisfaction of the other conditions set forth in the Declaration (as
defined below), including, without limitation, Section 9.1 thereof. The
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities represented hereby are issued and shall in
all respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust dated as of [ ], 199 , as the same may be
amended from time to time (the "Declaration"), including the designation of the
terms of the Common Securities as set forth in Annex I thereto. Capitalized
terms used herein but not defined shall have the meaning given them in the
Declaration. The Sponsor will provide a copy of the Declaration and the
Indenture to a Holder without charge upon written request to the Sponsor at its
principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
A2-1
<PAGE>
The Holder of this certificate, by accepting this certificate, is
deemed to have agreed to the terms of the Indenture and the Debentures,
including that the Debentures are subordinate and junior in right of payment to
all Senior Indebtedness (as defined in the Indenture) as and to the extent
provided in the Indenture.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Common Securities as
evidence of indirect beneficial ownership in the Debentures.
A2-2
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate this ___ day of
_________, ____.
-----------------------------------
Heidi G. Miller, as Trustee
-----------------------------------
Irwin Ettinger, as Trustee
A2-3
<PAGE>
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security Certificate to:
________________________________________________________________________________
________________________________________________________________________________
_______________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
__________________________
(Insert address and zip code of assignee)
and irrevocably appoints ______________________________________________________
______________________________________________________________________________
_______________________________________ agent to transfer this Common Security
Certificate on the books of the Trust. The agent may substitute another to act
for him or her.
Date: _______________________
Signature: __________________
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
A2-4
<PAGE>
EXHIBIT B
SPECIMEN OF DEBENTURE
B-1
<PAGE>
EXHIBIT C
UNDERWRITING AGREEMENT
C-1
<PAGE>
Exhibit 4.14
===================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
Travelers Capital VI
Dated as of [ ], 199_
===================================
<PAGE>
TABLE OF CONTENTS
-----------------
Page
----
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation....................... 1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application..................... 4
SECTION 2.2 Lists of Holders of Securities....................... 5
SECTION 2.3 Reports by the Preferred Guarantee Trustee........... 5
SECTION 2.4 Periodic Reports to Preferred Guarantee Trustee...... 5
SECTION 2.5 Evidence of Compliance with Conditions Precedent..... 5
SECTION 2.6 Events of Default; Waiver............................ 6
SECTION 2.7 Event of Default; Notice............................. 6
SECTION 2.8 Conflicting Interests................................ 6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Guarantee Trustee. 6
SECTION 3.2 Certain Rights of Preferred Guarantee Trustee........ 8
SECTION 3.3. Not Responsible for Recitals or Issuance of Guarantee 10
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 Preferred Guarantee Trustee; Eligibility............. 10
SECTION 4.2 Appointment, Removal and Resignation of Preferred
Guarantee Trustees .................................. 11
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee............................................ 12
SECTION 5.2 Waiver of Notice and Demand.......................... 12
SECTION 5.3 Obligations Not Affected............................. 12
SECTION 5.4 Rights of Holders.................................... 13
SECTION 5.5 Guarantee of Payment................................. 13
<PAGE>
SECTION 5.6 Subrogation.......................................... 14
SECTION 5.7 Independent Obligations.............................. 14
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions........................... 14
SECTION 6.2 Ranking.............................................. 15
ARTICLE VII
TERMINATION
SECTION 7.1 Termination.......................................... 15
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation.......................................... 15
SECTION 8.2 Indemnification...................................... 16
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns............................... 16
SECTION 9.2 Amendments........................................... 16
SECTION 9.3 Notices.............................................. 16
SECTION 9.4 Benefit.............................................. 17
SECTION 9.5 Governing Law........................................ 17
II
<PAGE>
PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Preferred Securities Guarantee"),
dated as of [ ], 199_, is executed and delivered by Travelers Group, Inc., a
Delaware corporation (the "Guarantor"), and The Chase Manhattan Bank, as trustee
(the "Preferred Guarantee Trustee"), for the benefit of the Holders (as defined
herein) from time to time of the Preferred Securities (as defined herein) of
Travelers Capital VI, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust
(the "Declaration"), dated as of [ ], 199_, among the trustees of the Issuer
named therein, the Guarantor, as sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing on the date hereof [ ] preferred securities, having an aggregate
liquidation amount of $[ ] (plus up to an additional preferred securities,
having an aggregate liquidation amount of $ if the over-allotment option granted
to the underwriters pursuant to the Underwriting Agreement (as hereinafter
defined) is exercised), designated the [ ]% Trust Preferred Securities (the
"Preferred Securities");
WHEREAS, as incentive for the Holders to purchase the Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Preferred Securities Guarantee, to pay to the
Holders the Guarantee Payments (as defined herein) and to make certain other
payments on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Preferred Securities
Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Preferred Securities Guarantee, unless the context otherwise
requires:
(a) Capitalized terms used in this Preferred Securities Guarantee
but not defined in the preamble above have the respective
meanings assigned to them in this Section 1.1;
(b) a term defined anywhere in this Preferred Securities Guarantee
has the same meaning throughout;
<PAGE>
(c) all references to "the Preferred Securities Guarantee" or
"this Preferred Securities Guarantee" are to this Preferred
Securities Guarantee as modified, supplemented or amended from
time to time;
(d) all references in this Preferred Securities Guarantee to
Articles and Sections are to Articles and Sections of this
Preferred Securities Guarantee, unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Preferred Securities Guarantee, unless
otherwise defined in this Preferred Securities Guarantee or
unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice
versa.
"Authorized Officer" of a Person means any Person that is authorized
to bind such Person.
"Affiliate" has the same meaning as given to that term in Rule 405
of the Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" means any day other than a Saturday, Sunday or a day
on which banking institutions in the City of New York, New York are permitted or
required by any applicable law to close.
"Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Issuer.
"Corporate Trust Office" means the office of the Preferred Guarantee
Trustee at which the corporate trust business of the Preferred Guarantee Trustee
shall, at any particular time, be principally administered, which office at the
date of execution of this Agreement is located at 450 West 33rd Street - 15th
Floor, New York, New York 10001.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
"Debentures" means the series of junior subordinated debt securities
of the Guarantor designated the [ ]% Junior Subordinated Deferrable Interest
Debentures due [ ], 20__ held by the Institutional Trustee (as defined in the
Declaration) of the Issuer.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Preferred Securities Guarantee.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent not
paid or made by the Issuer:
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<PAGE>
(i) any accrued and unpaid Distributions (as defined in Annex I to the
Declaration) that are required to be paid on the Preferred Securities, to the
extent the Issuer has funds available therefor, (ii) the redemption price of $25
per Preferred Security, plus all accrued and unpaid Distributions to the date of
redemption (the "Redemption Price"), to the extent the Issuer has funds
available therefor, with respect to any Preferred Securities called for
redemption by the Issuer and (iii) upon a voluntary or involuntary dissolution,
winding-up or termination of the Issuer (other than in connection with the
distribution of Debentures to the Holders in exchange for Preferred Securities
as provided in the Declaration or the redemption of all of the Preferred
Securities upon the maturity or redemption of all of the Debentures as provided
in the Declaration) the lesser of (a) the aggregate of the liquidation amount of
$25 per Preferred Security and all accrued and unpaid Distributions on the
Preferred Securities to the date of payment, or (b) the amount of assets of the
Issuer remaining for distribution to Holders in liquidation of the Issuer (in
either case, the "Liquidation Distribution").
"Holder" shall mean any holder, as registered on the books and
records of the Issuer, of any Preferred Securities; provided, however, that, in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee, any
Affiliate of the Preferred Guarantee Trustee, or any officers, directors,
shareholders, members, partners, employees, representatives, nominees,
custodians or agents of the Preferred Guarantee Trustee.
"Indenture" means the Indenture dated as of October 7, 1996 among
the Guarantor and The Chase Manhattan Bank, as trustee, and any indenture
supplemental thereto pursuant to which the Debentures are to be issued to the
Institutional Trustee of the Issuer.
"Majority in liquidation amount of the Securities" means, except as
provided by the Trust Indenture Act, a vote by Holder(s), voting separately as a
class, holding Preferred Securities representing more than 50% of the aggregate
liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of all Preferred
Securities.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Preferred Securities Guarantee shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
3
<PAGE>
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Preferred Guarantee Trustee" means The Chase Manhattan Bank, until
a Successor Preferred Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Preferred Securities Guarantee and
thereafter means each such Successor Preferred Guarantee Trustee.
"Responsible Officer" means, with respect to the Preferred Guarantee
Trustee, any officer within the Corporate Trust Office of the Preferred
Guarantee Trustee, including any vice-president, any assistant vice-president,
any assistant secretary, the treasurer, any assistant treasurer or other officer
of the Corporate Trust Office of the Preferred Guarantee Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Successor Preferred Guarantee Trustee" means a successor Preferred
Guarantee Trustee possessing the qualifications to act as Preferred Guarantee
Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
"Underwriting Agreement" has the meaning set forth in the Indenture.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Preferred Securities Guarantee is subject to the provisions
of the Trust Indenture Act that are required to be part of this Preferred
Securities Guarantee and shall, to the extent applicable, be governed by such
provisions; and
4
<PAGE>
(b) if and to the extent that any provision of this Preferred
Securities Guarantee limits, qualifies or conflicts with the duties imposed by
Section 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the Preferred Guarantee Trustee with
a list, in such form as the Preferred Guarantee Trustee may reasonably require,
of the names and addresses of the Holders ("List of Holders") as of such date,
(i) within one Business Day after January 1 and June 30 of each year, and (ii)
at any other time within 30 days of receipt by the Guarantor of a written
request for a List of Holders as of a date no more than 14 days before such List
of Holders is given to the Preferred Guarantee Trustee provided, that the
Guarantor shall not be obligated to provide such List of Holders at any time the
List of Holders does not differ from the most recent List of Holders given to
the Preferred Guarantee Trustee by the Guarantor. The Preferred Guarantee
Trustee may destroy any List of Holders previously given to it on receipt of a
new List of Holders.
(b) The Preferred Guarantee Trustee shall comply with its
obligations under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Preferred Guarantee Trustee
Within 60 days after April 15 of each year, the Preferred Guarantee
Trustee shall provide to the Holders such reports as are required by Section 313
of the Trust Indenture Act, if any, in the form and in the manner provided by
Section 313 of the Trust Indenture Act. The Preferred Guarantee Trustee shall
also comply with the requirements of Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Preferred Guarantee Trustee
The Guarantor shall provide to the Preferred Guarantee Trustee such
documents, reports and information as required by Section 314 (if any) and the
compliance certificate required by Section 314 of the Trust Indenture Act in the
form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Preferred Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Preferred Securities Guarantee that relate to any of the matters set forth
in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given in
the form of an Officers' Certificate.
5
<PAGE>
SECTION 2.6 Events of Default; Waiver
The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured, for every purpose of this
Preferred Securities Guarantee, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
SECTION 2.7 Event of Default; Notice
(a) The Preferred Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders, notices of all Events of Default actually known to a
Responsible Officer of the Preferred Guarantee Trustee, unless such defaults
have been cured before the giving of such notice, provided, that, the Preferred
Guarantee Trustee shall be protected in withholding such notice if and so long
as a Responsible Officer of the Preferred Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders.
(b) The Preferred Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the Preferred Guarantee Trustee shall
have received written notice, or of which a Responsible Officer of the Preferred
Guarantee Trustee charged with the administration of the Declaration shall have
obtained actual knowledge.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described in this
Preferred Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Guarantee Trustee
(a) This Preferred Securities Guarantee shall be held by the
Preferred Guarantee Trustee for the benefit of the Holders, and the Preferred
Guarantee Trustee shall not transfer its right, title and interest in this
Preferred Securities Guarantee to any Person except a Holder exercising his or
her rights pursuant to Section 5.4(b) or to a Successor Preferred Guarantee
Trustee on acceptance by such Successor Preferred Guarantee Trustee of its
appointment to act as Successor Preferred Guarantee Trustee. The right, title
and interest of the Preferred Guarantee Trustee shall automatically vest in any
Successor Preferred Guarantee Trustee, and such vesting and cessation of title
shall be effective whether or not conveyancing
6
<PAGE>
documents have been executed and delivered pursuant to the appointment of such
Successor Preferred Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible Officer
of the Preferred Guarantee Trustee has occurred and is continuing, the Preferred
Guarantee Trustee shall enforce this Preferred Securities Guarantee for the
benefit of the Holders of the Preferred Securities.
(c) The Preferred Guarantee Trustee, before the occurrence of any
Event of Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Preferred Securities Guarantee, and no implied covenants shall be
read into this Preferred Securities Guarantee against the Preferred Guarantee
Trustee. In case an Event of Default has occurred (that has not been cured or
waived pursuant to Section 2.6) and is actually known to a Responsible Officer
of the Preferred Guarantee Trustee, the Preferred Guarantee Trustee shall
exercise such of the rights and powers vested in it by this Preferred Securities
Guarantee, 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 Preferred Securities Guarantee shall be
construed to relieve the Preferred Guarantee Trustee from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Preferred Guarantee
Trustee shall be determined solely by the express provisions of this
Preferred Securities Guarantee, and the Preferred Guarantee Trustee
shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Preferred
Securities Guarantee, and no implied covenants or obligations shall
be read into this Preferred Securities Guarantee against the
Preferred Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Preferred
Guarantee Trustee, the Preferred Guarantee Trustee may conclusively
rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Preferred Guarantee Trustee and conforming to the
requirements of this Preferred Securities Guarantee; but in the case
of any such certificates or opinions that by any provision hereof
are specifically required to be furnished to the Preferred Guarantee
Trustee, the Preferred Guarantee Trustee shall be under a duty to
examine the same to determine whether or not they conform to the
requirements of this Preferred Securities Guarantee;
7
<PAGE>
(ii) the Preferred Guarantee Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer of the
Preferred Guarantee Trustee, unless it shall be proved that the Preferred
Guarantee Trustee was negligent in ascertaining the pertinent facts upon
which such judgment was made;
(iii) the Preferred Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a Majority
in liquidation amount of the Preferred Securities relating to the time,
method and place of conducting any proceeding for any remedy available to
the Preferred Guarantee Trustee, or exercising any trust or power
conferred upon the Preferred Guarantee Trustee under this Preferred
Securities Guarantee; and
(iv) no provision of this Preferred Securities Guarantee shall
require the Preferred Guarantee Trustee to expend or risk its own funds or
otherwise incur personal financial liability in the performance of any of
its duties or in the exercise of any of its rights or powers, if the
Preferred Guarantee Trustee shall have reasonable grounds for believing
that the repayment of such funds or liability is not reasonably assured to
it under the terms of this Preferred Securities Guarantee or indemnity,
reasonably satisfactory to the Preferred Guarantee Trustee, against such
risk or liability is not reasonably assured to it.
SECTION 3.2 Certain Rights of Preferred Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Preferred Guarantee 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, note, other evidence
of indebtedness or other paper or document believed by it to be genuine
and to have been signed, sent or presented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by this
Preferred Securities Guarantee shall be sufficiently evidenced by an
Officers' Certificate.
(iii) Whenever, in the administration of this Preferred Securities
Guarantee, the Preferred Guarantee Trustee shall deem it desirable that a
matter be proved or established before taking, suffering or omitting any
action hereunder, the Preferred Guarantee Trustee (unless other evidence
is herein specifically prescribed) may, in the absence of bad faith on its
part, request and conclusively rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the
Guarantor.
(iv) The Preferred Guarantee Trustee shall have no duty to see to
any recording, filing or registration of any instrument (or any
rerecording, refiling or registration thereof).
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(v) The Preferred Guarantee Trustee may consult with counsel, and
the written advice or opinion of such counsel with respect to legal
matters shall be full and complete authorization and protection in respect
of any action taken, suffered or omitted by it hereunder in good faith and
in accordance with such advice or opinion. Such counsel may be counsel to
the Guarantor or any of its Affiliates and may include any of its
employees. The Preferred Guarantee Trustee shall have the right at any
time to seek instructions concerning the administration of this Preferred
Securities Guarantee from any court of competent jurisdiction.
(vi) The Preferred Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Preferred
Securities Guarantee at the request or direction of any Holder, unless
such Holder shall have provided to the Preferred Guarantee Trustee such
security and indemnity, reasonably satisfactory to the Preferred Guarantee
Trustee, against the costs, expenses (including attorneys' fees and
expenses and the expenses of the Preferred Guarantee Trustee's agents,
nominees or custodians) and liabilities that might be incurred by it in
complying with such request or direction, including such reasonable
advances as may be requested by the Preferred Guarantee Trustee; provided
that, nothing contained in this Section 3.2(a)(vi) shall be taken to
relieve the Preferred Guarantee Trustee, upon the occurrence of an Event
of Default, of its obligation to exercise the rights and powers vested in
it by this Preferred Securities Guarantee.
(vii) The Preferred Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Preferred Guarantee
Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit.
(viii) The Preferred Guarantee Trustee may execute any of the trusts
or powers hereunder or perform any duties hereunder either directly or by
or through agents, nominees, custodians or attorneys, and the Preferred
Guarantee Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
(ix) Any action taken by the Preferred Guarantee Trustee or its
agents hereunder shall bind the Holders of the Preferred Securities, and
the signature of the Preferred Guarantee Trustee or its agents alone shall
be sufficient and effective to perform any such action. No third party
shall be required to inquire as to the authority of the Preferred
Guarantee Trustee to so act or as to its compliance with any of the terms
and provisions of this Preferred Securities Guarantee, both of which shall
be conclusively evidenced by the Preferred Guarantee Trustee's or its
agent's taking such action.
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(x) Whenever in the administration of this Preferred Securities
Guarantee the Preferred Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Preferred Guarantee Trustee (i) may
request instructions from the Holders of a Majority in liquidation amount
of the Preferred Securities, (ii) may refrain from enforcing such remedy
or right or taking such other action until such instructions are received,
and (iii) shall be protected in conclusively relying on or acting in
accordance with such instructions.
(b) No provision of this Preferred Securities Guarantee shall be
deemed to impose any duty or obligation on the Preferred Guarantee Trustee to
perform any act or acts or exercise any right, power, duty or obligation
conferred or imposed on it in any jurisdiction in which it shall be illegal, or
in which the Preferred Guarantee Trustee shall be unqualified or incompetent in
accordance with applicable law, to perform any such act or acts or to exercise
any such right, power, duty or obligation. No permissive power or authority
available to the Preferred Guarantee Trustee shall be construed to be a duty.
SECTION 3.3. Not Responsible for Recitals or Issuance of Guarantee
The recitals contained in this Guarantee shall be taken as the
statements of the Guarantor, and the Preferred Guarantee Trustee does not assume
any responsibility for their correctness. The Preferred Guarantee Trustee makes
no representation as to the validity or sufficiency of this Preferred Securities
Guarantee.
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 Preferred Guarantee Trustee; Eligibility
(a) There shall at all times be a Preferred Guarantee Trustee which
shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an institutional trustee
under the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
50 million U.S. dollars ($50,000,000), and subject to supervision or
examination by Federal, State, Territorial or District of Columbia
authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the supervising or
examining authority referred to above, then, for the purposes of this
Section 4.1(a)(ii), the combined capital and surplus of such corporation
shall be deemed
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to be its combined capital and surplus as set forth in its most recent
report of condition so published.
(b) If at any time the Preferred Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Preferred Guarantee Trustee
shall immediately resign in the manner and with the effect set out in
Section 4.2(c).
(c) If the Preferred Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Preferred Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Preferred Guarantee
Trustees
(a) Subject to Section 4.2(b), the Preferred Guarantee Trustee may
be appointed or removed without cause at any time by the Guarantor.
(b) The Preferred Guarantee Trustee shall not be removed in
accordance with Section 4.2(a) until a Successor Preferred Guarantee Trustee has
been appointed and has accepted such appointment by written instrument executed
by such Successor Preferred Guarantee Trustee and delivered to the Guarantor.
(c) The Preferred Guarantee Trustee appointed to office shall hold
office until a Successor Preferred Guarantee Trustee shall have been appointed
or until its removal or resignation. The Preferred Guarantee Trustee may resign
from office (without need for prior or subsequent accounting) by an instrument
in writing executed by the Preferred Guarantee Trustee and delivered to the
Guarantor, which resignation shall not take effect until a Successor Preferred
Guarantee Trustee has been appointed and has accepted such appointment by
instrument in writing executed by such Successor Preferred Guarantee Trustee and
delivered to the Guarantor and the resigning Preferred Guarantee Trustee.
(d) If no Successor Preferred Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within 60
days after delivery to the Guarantor of an instrument of resignation, the
resigning Preferred Guarantee Trustee may petition any court of competent
jurisdiction for appointment of a Successor Preferred Guarantee Trustee. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor Preferred Guarantee Trustee.
(e) No Preferred Guarantee Trustee shall be liable for the acts or
omissions to act of any Successor Preferred Guarantee Trustee.
(f) Upon termination of this Preferred Securities Guarantee or
removal or resignation of the Preferred Guarantee Trustee pursuant to this
Section 4.2, the Guarantor shall
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pay to the Preferred Guarantee Trustee all amounts accrued and owing to such
Preferred Guarantee Trustee to the date of such termination, removal or
resignation.
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in full
to the Holders the Guarantee Payments, as and when due, regardless of any
defense, right of set-off or counterclaim that the Issuer may have or assert.
The Guarantor's obligation to make a Guarantee Payment may be satisfied by
direct payment of the required amounts by the Guarantor to the Holders or by
causing the Issuer to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this Preferred
Securities Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first against
the Issuer or any other Person before proceeding against the Guarantor, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the Guarantor
under this Preferred Securities Guarantee shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or
any portion of the Distributions, Redemption Price, Liquidation Distribution or
any other sums payable under the terms of the Preferred Securities or the
extension of time for the performance of any other obligation under, arising out
of, or in connection with, the Preferred Securities;
(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Preferred Securities, or
any action on the part of the Issuer granting indulgence or extension of any
kind;
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(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of debt
of, or other similar proceedings affecting, the Issuer or any of the assets of
the Issuer;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it being
the intent of this Section 5.3 that the obligations of the Guarantor hereunder
shall be absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4 Rights of Holders
(a) The Holders of a Majority in liquidation amount of the Preferred
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Preferred Guarantee Trustee in
respect of this Preferred Securities Guarantee or exercising any trust or power
conferred upon the Preferred Guarantee Trustee under this Preferred Securities
Guarantee.
(b) If the Preferred Guarantee Trustee fails to enforce its rights
under this Preferred Securities Guarantee, any Holder may directly institute a
legal proceeding against the Guarantor to enforce the Preferred Guarantee
Trustee's rights under this Preferred Securities Guarantee, without first
instituting a legal proceeding against the Issuer, the Preferred Guarantee
Trustee or any other Person or entity.
(c) A Holder of Preferred Securities may also directly institute a
legal proceeding against the Guarantor to enforce such Holder's right to receive
payment under this Preferred Securities Guarantee without first (i) directing
the Preferred Guarantee Trustee to enforce the terms of this Preferred
Securities Guarantee or (ii) instituting a legal proceeding directly against the
Issuer or any other Person or entity.
SECTION 5.5 Guarantee of Payment
This Preferred Securities Guarantee creates a guarantee of payment
and not of collection.
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SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of the
Holders of Preferred Securities against the Issuer in respect of any amounts
paid to such Holders by the Guarantor under this Preferred Securities Guarantee;
provided, however, that the Guarantor shall not (except to the extent required
by mandatory provisions of law) be entitled to enforce or exercise any right
that it may acquire by way of subrogation or any indemnity, reimbursement or
other agreement, in all cases as a result of payment under this Preferred
Securities Guarantee, if, at the time of any such payment, any amounts are due
and unpaid under this Preferred Securities Guarantee. If any amount shall be
paid to the Guarantor in violation of the preceding sentence, the Guarantor
agrees to hold such amount in trust for the Holders and to pay over such amount
to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Preferred
Securities Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Preferred Securities remain outstanding, if there
shall have occurred any event that would constitute an Event of Default or an
event of default under the Declaration, then (a) the Guarantor shall not declare
or pay any dividend on, make any distributions with respect to, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of its
capital stock or make any guarantee payment with respect thereto (other than (i)
repurchases, redemptions or other acquisitions of shares of capital stock of the
Guarantor in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of employees, officers, directors or
consultants, (ii) as a result of an exchange or conversion of any class or
series of the Guarantor's capital stock for any other class or series of the
Guarantor's capital stock, or (iii) the purchase of fractional interests in
shares of the Guarantor's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged)
and (b) the Guarantor shall not make any payment of interest on, or principal of
(or premium, if any, on), or repay, repurchase or redeem, any debt securities
issued by the Guarantor which rank pari passu with or junior to the Debentures;
provided, however, the Guarantor may declare and pay a stock dividend where the
dividend stock is the same stock as that on which the dividend is being paid.
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SECTION 6.2 Ranking
This Preferred Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to all other liabilities of the Guarantor, (ii) pari passu with the most
senior preferred or preference stock now or hereafter issued by the Guarantor
and with any guarantee now or hereafter entered into by the Guarantor in respect
of any preferred or preference stock of any Affiliate of the Guarantor, and
(iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Preferred Securities Guarantee shall terminate upon (i) full
payment of the Redemption Price of all Preferred Securities, (ii) the
distribution of the Debentures to the Holders of all of the Preferred Securities
or (iii) full payment of the amounts payable in accordance with the Declaration
upon liquidation of the Issuer. Notwithstanding the foregoing, this Preferred
Securities Guarantee will continue to be effective or will be reinstated, as the
case may be, if at any time any Holder must restore payment of any sums paid
under the Preferred Securities or under this Preferred Securities Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Guarantor or any Covered Person for
any loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith in accordance with this
Preferred Securities Guarantee and in a manner that such Indemnified Person
reasonably believed to be within the scope of the authority conferred on such
Indemnified Person by this Preferred Securities Guarantee or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's negligence or willful misconduct
with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in
good faith upon the records of the Guarantor and upon such information,
opinions, reports or statements presented to the Guarantor by any Person as to
matters the Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the assets,
liabilities, profits, losses, or any other facts
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pertinent to the existence and amount of assets from which Distributions to
Holders might properly be paid.
SECTION 8.2 Indemnification
The Guarantor agrees to indemnify each Indemnified Person for, and
to hold each Indemnified Person harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against, or investigating, any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder. The obligation to indemnify as set forth in this Section 8.2 shall
survive the termination of this Preferred Securities Guarantee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
All guarantees and agreements contained in this Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Preferred Securities then outstanding.
SECTION 9.2 Amendments
Except with respect to any changes that do not adversely affect the
rights of Holders (in which case no consent of Holders will be required), this
Preferred Securities Guarantee may be amended only with the prior approval of
the Holders of not less than a Majority in aggregate liquidation amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all the outstanding Preferred Securities.
The provisions of Section 12.2 of the Declaration with respect to meetings of
Holders apply to the giving of such approval.
SECTION 9.3 Notices
All notices provided for in this Preferred Securities Guarantee
shall be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by registered or certified mail, as follows:
(a) If given to the Preferred Guarantee Trustee, at the Preferred
Guarantee Trustee's mailing address set forth below (or such other address as
the Preferred Guarantee Trustee may give notice of to the Holders):
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The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, New York 10001
Attention: Sheik Wiltshire
(b) If given to the Guarantor, at the Guarantor's mailing address
set forth below (or such other address as the Guarantor may give notice of to
the Holders):
Travelers Group Inc.
388 Greenwich Street
New York, New York 10013
Attention: Charles O. Prince III, Secretary
(c) If given to any Holder, at the address set forth on the books
and records of the Issuer.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 9.4 Benefit
This Preferred Securities Guarantee is solely for the benefit of the
Holders of the Preferred Securities and, subject to Section 3.1(a), is not
separately transferable from the Preferred Securities.
SECTION 9.5 Governing Law
THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD FOR
THE PRINCIPLES OF ITS CONFLICTS OF LAWS.
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THIS PREFERRED SECURITIES GUARANTEE is executed as of the day and
year first above written.
TRAVELERS GROUP INC.,
as Guarantor
By:
-----------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as Preferred
Guarantee Trustee
By:
-----------------------------
Name:
Title:
<PAGE>
Exhibit 4.15
====================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
Travelers Capital VII
Dated as of [ ], 199_
====================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation.................................. 1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application................................ 4
SECTION 2.2 Lists of Holders of Securities.................................. 5
SECTION 2.3 Reports by the Preferred Guarantee Trustee...................... 5
SECTION 2.4 Periodic Reports to Preferred Guarantee Trustee................. 5
SECTION 2.5 Evidence of Compliance with Conditions Precedent................ 5
SECTION 2.6 Events of Default; Waiver....................................... 6
SECTION 2.7 Event of Default; Notice........................................ 6
SECTION 2.8 Conflicting Interests........................................... 6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Guarantee Trustee............ 6
SECTION 3.2 Certain Rights of Preferred Guarantee Trustee................... 8
SECTION 3.3. Not Responsible for Recitals or Issuance of Guarantee........... 10
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 Preferred Guarantee Trustee; Eligibility........................ 10
SECTION 4.2 Appointment, Removal and Resignation of Preferred
Guarantee Trustees.............................................. 11
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee....................................................... 12
SECTION 5.2 Waiver of Notice and Demand..................................... 12
SECTION 5.3 Obligations Not Affected........................................ 12
SECTION 5.4 Rights of Holders............................................... 13
SECTION 5.5 Guarantee of Payment............................................ 13
<PAGE>
Page
----
SECTION 5.6 Subrogation..................................................... 14
SECTION 5.7 Independent Obligations......................................... 14
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions...................................... 14
SECTION 6.2 Ranking......................................................... 15
ARTICLE VII
TERMINATION
SECTION 7.1 Termination..................................................... 15
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation..................................................... 15
SECTION 8.2 Indemnification................................................. 16
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns.......................................... 16
SECTION 9.2 Amendments...................................................... 16
SECTION 9.3 Notices......................................................... 16
SECTION 9.4 Benefit......................................................... 17
SECTION 9.5 Governing Law................................................... 17
ii
<PAGE>
PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Preferred Securities Guarantee"), dated as
of [ ], 199_, is executed and delivered by Travelers Group, Inc., a Delaware
corporation (the "Guarantor"), and The Chase Manhattan Bank, as trustee (the
"Preferred Guarantee Trustee"), for the benefit of the Holders (as defined
herein) from time to time of the Preferred Securities (as defined herein) of
Travelers Capital VII, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of [ ], 199_, among the trustees of the Issuer named
therein, the Guarantor, as sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing on the date hereof [ ] preferred securities, having an aggregate
liquidation amount of $[ ] (plus up to an additional preferred securities,
having an aggregate liquidation amount of $ if the over-allotment option granted
to the underwriters pursuant to the Underwriting Agreement (as hereinafter
defined) is exercised), designated the [ ]% Trust Preferred Securities (the
"Preferred Securities");
WHEREAS, as incentive for the Holders to purchase the Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Preferred Securities Guarantee, to pay to the
Holders the Guarantee Payments (as defined herein) and to make certain other
payments on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Preferred Securities
Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Preferred Securities Guarantee, unless the context otherwise
requires:
(a) Capitalized terms used in this Preferred Securities Guarantee but
not defined in the preamble above have the respective meanings
assigned to them in this Section 1.1;
(b) a term defined anywhere in this Preferred Securities Guarantee has
the same meaning throughout;
<PAGE>
(c) all references to "the Preferred Securities Guarantee" or "this
Preferred Securities Guarantee" are to this Preferred Securities
Guarantee as modified, supplemented or amended from time to time;
(d) all references in this Preferred Securities Guarantee to Articles
and Sections are to Articles and Sections of this Preferred
Securities Guarantee, unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Preferred Securities Guarantee, unless otherwise
defined in this Preferred Securities Guarantee or unless the context
otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Authorized Officer" of a Person means any Person that is authorized to
bind such Person.
"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" means any day other than a Saturday, Sunday or a day on
which banking institutions in the City of New York, New York are permitted or
required by any applicable law to close.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer.
"Corporate Trust Office" means the office of the Preferred Guarantee
Trustee at which the corporate trust business of the Preferred Guarantee Trustee
shall, at any particular time, be principally administered, which office at the
date of execution of this Agreement is located at 450 West 33rd Street - 15th
Floor, New York, New York 10001.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
"Debentures" means the series of junior subordinated debt securities of
the Guarantor designated the [ ]% Junior Subordinated Deferrable Interest
Debentures due [ ], 20__ held by the Institutional Trustee (as defined in the
Declaration) of the Issuer.
"Event of Default" means a default by the Guarantor on any of its payment
or other obligations under this Preferred Securities Guarantee.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent not
paid or made by the Issuer:
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(i) any accrued and unpaid Distributions (as defined in Annex I to the
Declaration) that are required to be paid on the Preferred Securities, to the
extent the Issuer has funds available therefor, (ii) the redemption price of $25
per Preferred Security, plus all accrued and unpaid Distributions to the date of
redemption (the "Redemption Price"), to the extent the Issuer has funds
available therefor, with respect to any Preferred Securities called for
redemption by the Issuer and (iii) upon a voluntary or involuntary dissolution,
winding-up or termination of the Issuer (other than in connection with the
distribution of Debentures to the Holders in exchange for Preferred Securities
as provided in the Declaration or the redemption of all of the Preferred
Securities upon the maturity or redemption of all of the Debentures as provided
in the Declaration) the lesser of (a) the aggregate of the liquidation amount of
$25 per Preferred Security and all accrued and unpaid Distributions on the
Preferred Securities to the date of payment, or (b) the amount of assets of the
Issuer remaining for distribution to Holders in liquidation of the Issuer (in
either case, the "Liquidation Distribution").
"Holder" shall mean any holder, as registered on the books and records of
the Issuer, of any Preferred Securities; provided, however, that, in determining
whether the holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee, any Affiliate
of the Preferred Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives, nominees, custodians or agents of
the Preferred Guarantee Trustee.
"Indenture" means the Indenture dated as of October 7, 1996 among the
Guarantor and The Chase Manhattan Bank, as trustee, and any indenture
supplemental thereto pursuant to which the Debentures are to be issued to the
Institutional Trustee of the Issuer.
"Majority in liquidation amount of the Securities" means, except as
provided by the Trust Indenture Act, a vote by Holder(s), voting separately as a
class, holding Preferred Securities representing more than 50% of the aggregate
liquidation amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of all Preferred
Securities.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by two Authorized Officers of such Person. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Preferred Securities Guarantee shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers'
Certificate;
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(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Preferred Guarantee Trustee" means The Chase Manhattan Bank, until a
Successor Preferred Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Preferred Securities Guarantee and
thereafter means each such Successor Preferred Guarantee Trustee.
"Responsible Officer" means, with respect to the Preferred Guarantee
Trustee, any officer within the Corporate Trust Office of the Preferred
Guarantee Trustee, including any vice-president, any assistant vice-president,
any assistant secretary, the treasurer, any assistant treasurer or other officer
of the Corporate Trust Office of the Preferred Guarantee Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"Successor Preferred Guarantee Trustee" means a successor Preferred
Guarantee Trustee possessing the qualifications to act as Preferred Guarantee
Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
"Underwriting Agreement" has the meaning set forth in the Indenture.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Preferred Securities Guarantee is subject to the provisions of
the Trust Indenture Act that are required to be part of this Preferred
Securities Guarantee and shall, to the extent applicable, be governed by such
provisions; and
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(b) if and to the extent that any provision of this Preferred Securities
Guarantee limits, qualifies or conflicts with the duties imposed by Section 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the Preferred Guarantee Trustee with a
list, in such form as the Preferred Guarantee Trustee may reasonably require, of
the names and addresses of the Holders ("List of Holders") as of such date, (i)
within one Business Day after January 1 and June 30 of each year, and (ii) at
any other time within 30 days of receipt by the Guarantor of a written request
for a List of Holders as of a date no more than 14 days before such List of
Holders is given to the Preferred Guarantee Trustee provided, that the Guarantor
shall not be obligated to provide such List of Holders at any time the List of
Holders does not differ from the most recent List of Holders given to the
Preferred Guarantee Trustee by the Guarantor. The Preferred Guarantee Trustee
may destroy any List of Holders previously given to it on receipt of a new List
of Holders.
(b) The Preferred Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Preferred Guarantee Trustee
Within 60 days after April 15 of each year, the Preferred Guarantee
Trustee shall provide to the Holders such reports as are required by Section 313
of the Trust Indenture Act, if any, in the form and in the manner provided by
Section 313 of the Trust Indenture Act. The Preferred Guarantee Trustee shall
also comply with the requirements of Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Preferred Guarantee Trustee
The Guarantor shall provide to the Preferred Guarantee Trustee such
documents, reports and information as required by Section 314 (if any) and the
compliance certificate required by Section 314 of the Trust Indenture Act in the
form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Preferred Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Preferred Securities Guarantee that relate to any of the matters set forth
in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given in
the form of an Officers' Certificate.
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SECTION 2.6 Events of Default; Waiver
The Holders of a Majority in liquidation amount of Preferred Securities
may, by vote, on behalf of the Holders of all of the Preferred Securities, waive
any past Event of Default and its consequences. Upon such waiver, any such Event
of Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured, for every purpose of this Preferred
Securities Guarantee, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
SECTION 2.7 Event of Default; Notice
(a) The Preferred Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders, notices of all Events of Default actually known to a
Responsible Officer of the Preferred Guarantee Trustee, unless such defaults
have been cured before the giving of such notice, provided, that, the Preferred
Guarantee Trustee shall be protected in withholding such notice if and so long
as a Responsible Officer of the Preferred Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders.
(b) The Preferred Guarantee Trustee shall not be deemed to have knowledge
of any Event of Default unless the Preferred Guarantee Trustee shall have
received written notice, or of which a Responsible Officer of the Preferred
Guarantee Trustee charged with the administration of the Declaration shall have
obtained actual knowledge.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described in this
Preferred Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Guarantee Trustee
(a) This Preferred Securities Guarantee shall be held by the Preferred
Guarantee Trustee for the benefit of the Holders, and the Preferred Guarantee
Trustee shall not transfer its right, title and interest in this Preferred
Securities Guarantee to any Person except a Holder exercising his or her rights
pursuant to Section 5.4(b) or to a Successor Preferred Guarantee Trustee on
acceptance by such Successor Preferred Guarantee Trustee of its appointment to
act as Successor Preferred Guarantee Trustee. The right, title and interest of
the Preferred Guarantee Trustee shall automatically vest in any Successor
Preferred Guarantee Trustee, and such vesting and cessation of title shall be
effective whether or not conveyancing
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documents have been executed and delivered pursuant to the appointment of such
Successor Preferred Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible Officer of the
Preferred Guarantee Trustee has occurred and is continuing, the Preferred
Guarantee Trustee shall enforce this Preferred Securities Guarantee for the
benefit of the Holders of the Preferred Securities.
(c) The Preferred Guarantee Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Preferred Securities Guarantee, and no implied covenants shall be read into
this Preferred Securities Guarantee against the Preferred Guarantee Trustee. In
case an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.6) and is actually known to a Responsible Officer of the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee shall exercise such
of the rights and powers vested in it by this Preferred Securities Guarantee,
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 Preferred Securities Guarantee shall be construed
to relieve the Preferred Guarantee Trustee from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(i) prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Preferred Guarantee
Trustee shall be determined solely by the express provisions of this
Preferred Securities Guarantee, and the Preferred Guarantee Trustee
shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Preferred
Securities Guarantee, and no implied covenants or obligations shall
be read into this Preferred Securities Guarantee against the
Preferred Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Preferred
Guarantee Trustee, the Preferred Guarantee Trustee may conclusively
rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Preferred Guarantee Trustee and conforming to the
requirements of this Preferred Securities Guarantee; but in the case
of any such certificates or opinions that by any provision hereof
are specifically required to be furnished to the Preferred Guarantee
Trustee, the Preferred Guarantee Trustee shall be under a duty to
examine the same to determine whether or not they conform to the
requirements of this Preferred Securities Guarantee;
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(ii) the Preferred Guarantee Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer of the
Preferred Guarantee Trustee, unless it shall be proved that the Preferred
Guarantee Trustee was negligent in ascertaining the pertinent facts upon
which such judgment was made;
(iii) the Preferred Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a Majority
in liquidation amount of the Preferred Securities relating to the time,
method and place of conducting any proceeding for any remedy available to
the Preferred Guarantee Trustee, or exercising any trust or power
conferred upon the Preferred Guarantee Trustee under this Preferred
Securities Guarantee; and
(iv) no provision of this Preferred Securities Guarantee shall
require the Preferred Guarantee Trustee to expend or risk its own funds or
otherwise incur personal financial liability in the performance of any of
its duties or in the exercise of any of its rights or powers, if the
Preferred Guarantee Trustee shall have reasonable grounds for believing
that the repayment of such funds or liability is not reasonably assured to
it under the terms of this Preferred Securities Guarantee or indemnity,
reasonably satisfactory to the Preferred Guarantee Trustee, against such
risk or liability is not reasonably assured to it.
SECTION 3.2 Certain Rights of Preferred Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Preferred Guarantee 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, note, other evidence
of indebtedness or other paper or document believed by it to be genuine
and to have been signed, sent or presented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by this
Preferred Securities Guarantee shall be sufficiently evidenced by an
Officers' Certificate.
(iii) Whenever, in the administration of this Preferred Securities
Guarantee, the Preferred Guarantee Trustee shall deem it desirable that a
matter be proved or established before taking, suffering or omitting any
action hereunder, the Preferred Guarantee Trustee (unless other evidence
is herein specifically prescribed) may, in the absence of bad faith on its
part, request and conclusively rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the
Guarantor.
(iv) The Preferred Guarantee Trustee shall have no duty to see to
any recording, filing or registration of any instrument (or any
rerecording, refiling or registration thereof).
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(v) The Preferred Guarantee Trustee may consult with counsel, and
the written advice or opinion of such counsel with respect to legal
matters shall be full and complete authorization and protection in respect
of any action taken, suffered or omitted by it hereunder in good faith and
in accordance with such advice or opinion. Such counsel may be counsel to
the Guarantor or any of its Affiliates and may include any of its
employees. The Preferred Guarantee Trustee shall have the right at any
time to seek instructions concerning the administration of this Preferred
Securities Guarantee from any court of competent jurisdiction.
(vi) The Preferred Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Preferred
Securities Guarantee at the request or direction of any Holder, unless
such Holder shall have provided to the Preferred Guarantee Trustee such
security and indemnity, reasonably satisfactory to the Preferred Guarantee
Trustee, against the costs, expenses (including attorneys' fees and
expenses and the expenses of the Preferred Guarantee Trustee's agents,
nominees or custodians) and liabilities that might be incurred by it in
complying with such request or direction, including such reasonable
advances as may be requested by the Preferred Guarantee Trustee; provided
that, nothing contained in this Section 3.2(a)(vi) shall be taken to
relieve the Preferred Guarantee Trustee, upon the occurrence of an Event
of Default, of its obligation to exercise the rights and powers vested in
it by this Preferred Securities Guarantee.
(vii) The Preferred Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Preferred Guarantee
Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit.
(viii) The Preferred Guarantee Trustee may execute any of the trusts
or powers hereunder or perform any duties hereunder either directly or by
or through agents, nominees, custodians or attorneys, and the Preferred
Guarantee Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
(ix) Any action taken by the Preferred Guarantee Trustee or its
agents hereunder shall bind the Holders of the Preferred Securities, and
the signature of the Preferred Guarantee Trustee or its agents alone shall
be sufficient and effective to perform any such action. No third party
shall be required to inquire as to the authority of the Preferred
Guarantee Trustee to so act or as to its compliance with any of the terms
and provisions of this Preferred Securities Guarantee, both of which shall
be conclusively evidenced by the Preferred Guarantee Trustee's or its
agent's taking such action.
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(x) Whenever in the administration of this Preferred Securities
Guarantee the Preferred Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Preferred Guarantee Trustee (i) may
request instructions from the Holders of a Majority in liquidation amount
of the Preferred Securities, (ii) may refrain from enforcing such remedy
or right or taking such other action until such instructions are received,
and (iii) shall be protected in conclusively relying on or acting in
accordance with such instructions.
(b) No provision of this Preferred Securities Guarantee shall be deemed to
impose any duty or obligation on the Preferred Guarantee Trustee to perform any
act or acts or exercise any right, power, duty or obligation conferred or
imposed on it in any jurisdiction in which it shall be illegal, or in which the
Preferred Guarantee Trustee shall be unqualified or incompetent in accordance
with applicable law, to perform any such act or acts or to exercise any such
right, power, duty or obligation. No permissive power or authority available to
the Preferred Guarantee Trustee shall be construed to be a duty.
SECTION 3.3. Not Responsible for Recitals or Issuance of Guarantee
The recitals contained in this Guarantee shall be taken as the statements
of the Guarantor, and the Preferred Guarantee Trustee does not assume any
responsibility for their correctness. The Preferred Guarantee Trustee makes no
representation as to the validity or sufficiency of this Preferred Securities
Guarantee.
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 Preferred Guarantee Trustee; Eligibility
(a) There shall at all times be a Preferred Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an institutional trustee
under the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
50 million U.S. dollars ($50,000,000), and subject to supervision or
examination by Federal, State, Territorial or District of Columbia
authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the supervising or
examining authority referred to above, then, for the purposes of this
Section 4.1(a)(ii), the combined capital and surplus of such corporation
shall be deemed
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to be its combined capital and surplus as set forth in its most recent
report of condition so published.
(b) If at any time the Preferred Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Preferred Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.2(c).
(c) If the Preferred Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Preferred Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.
SECTION 4.2 Appointment, Removal and Resignation of Preferred Guarantee
Trustees
(a) Subject to Section 4.2(b), the Preferred Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Preferred Guarantee Trustee shall not be removed in accordance
with Section 4.2(a) until a Successor Preferred Guarantee Trustee has been
appointed and has accepted such appointment by written instrument executed by
such Successor Preferred Guarantee Trustee and delivered to the Guarantor.
(c) The Preferred Guarantee Trustee appointed to office shall hold office
until a Successor Preferred Guarantee Trustee shall have been appointed or until
its removal or resignation. The Preferred Guarantee Trustee may resign from
office (without need for prior or subsequent accounting) by an instrument in
writing executed by the Preferred Guarantee Trustee and delivered to the
Guarantor, which resignation shall not take effect until a Successor Preferred
Guarantee Trustee has been appointed and has accepted such appointment by
instrument in writing executed by such Successor Preferred Guarantee Trustee and
delivered to the Guarantor and the resigning Preferred Guarantee Trustee.
(d) If no Successor Preferred Guarantee Trustee shall have been appointed
and accepted appointment as provided in this Section 4.2 within 60 days after
delivery to the Guarantor of an instrument of resignation, the resigning
Preferred Guarantee Trustee may petition any court of competent jurisdiction for
appointment of a Successor Preferred Guarantee Trustee. Such court may
thereupon, after prescribing such notice, if any, as it may deem proper, appoint
a Successor Preferred Guarantee Trustee.
(e) No Preferred Guarantee Trustee shall be liable for the acts or
omissions to act of any Successor Preferred Guarantee Trustee.
(f) Upon termination of this Preferred Securities Guarantee or removal or
resignation of the Preferred Guarantee Trustee pursuant to this Section 4.2, the
Guarantor shall
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pay to the Preferred Guarantee Trustee all amounts accrued and owing to such
Preferred Guarantee Trustee to the date of such termination, removal or
resignation.
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments, as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this Preferred
Securities Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first against
the Issuer or any other Person before proceeding against the Guarantor, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the Guarantor under
this Preferred Securities Guarantee shall in no way be affected or impaired by
reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Preferred Securities or the extension
of time for the performance of any other obligation under, arising out of, or in
connection with, the Preferred Securities;
(c) any failure, omission, delay or lack of diligence on the part of the
Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Preferred Securities, or
any action on the part of the Issuer granting indulgence or extension of any
kind;
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(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain
consent of, the Guarantor with respect to the happening of any of the foregoing.
SECTION 5.4 Rights of Holders
(a) The Holders of a Majority in liquidation amount of the Preferred
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Preferred Guarantee Trustee in
respect of this Preferred Securities Guarantee or exercising any trust or power
conferred upon the Preferred Guarantee Trustee under this Preferred Securities
Guarantee.
(b) If the Preferred Guarantee Trustee fails to enforce its rights under
this Preferred Securities Guarantee, any Holder may directly institute a legal
proceeding against the Guarantor to enforce the Preferred Guarantee Trustee's
rights under this Preferred Securities Guarantee, without first instituting a
legal proceeding against the Issuer, the Preferred Guarantee Trustee or any
other Person or entity.
(c) A Holder of Preferred Securities may also directly institute a legal
proceeding against the Guarantor to enforce such Holder's right to receive
payment under this Preferred Securities Guarantee without first (i) directing
the Preferred Guarantee Trustee to enforce the terms of this Preferred
Securities Guarantee or (ii) instituting a legal proceeding directly against the
Issuer or any other Person or entity.
SECTION 5.5 Guarantee of Payment
This Preferred Securities Guarantee creates a guarantee of payment and not
of collection.
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SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of the Holders of
Preferred Securities against the Issuer in respect of any amounts paid to such
Holders by the Guarantor under this Preferred Securities Guarantee; provided,
however, that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any right that
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Preferred Securities
Guarantee, if, at the time of any such payment, any amounts are due and unpaid
under this Preferred Securities Guarantee. If any amount shall be paid to the
Guarantor in violation of the preceding sentence, the Guarantor agrees to hold
such amount in trust for the Holders and to pay over such amount to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Issuer with respect to the Preferred Securities, and
that the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Preferred Securities Guarantee
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Preferred Securities remain outstanding, if there shall
have occurred any event that would constitute an Event of Default or an event of
default under the Declaration, then (a) the Guarantor shall not declare or pay
any dividend on, make any distributions with respect to, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of its capital stock
or make any guarantee payment with respect thereto (other than (i) repurchases,
redemptions or other acquisitions of shares of capital stock of the Guarantor in
connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of employees, officers, directors or
consultants, (ii) as a result of an exchange or conversion of any class or
series of the Guarantor's capital stock for any other class or series of the
Guarantor's capital stock, or (iii) the purchase of fractional interests in
shares of the Guarantor's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged)
and (b) the Guarantor shall not make any payment of interest on, or principal of
(or premium, if any, on), or repay, repurchase or redeem, any debt securities
issued by the Guarantor which rank pari passu with or junior to the Debentures;
provided, however, the Guarantor may declare and pay a stock dividend where the
dividend stock is the same stock as that on which the dividend is being paid.
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SECTION 6.2 Ranking
This Preferred Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to all other liabilities of the Guarantor, (ii) pari passu with the most
senior preferred or preference stock now or hereafter issued by the Guarantor
and with any guarantee now or hereafter entered into by the Guarantor in respect
of any preferred or preference stock of any Affiliate of the Guarantor, and
(iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Preferred Securities Guarantee shall terminate upon (i) full payment
of the Redemption Price of all Preferred Securities, (ii) the distribution of
the Debentures to the Holders of all of the Preferred Securities or (iii) full
payment of the amounts payable in accordance with the Declaration upon
liquidation of the Issuer. Notwithstanding the foregoing, this Preferred
Securities Guarantee will continue to be effective or will be reinstated, as the
case may be, if at any time any Holder must restore payment of any sums paid
under the Preferred Securities or under this Preferred Securities Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Guarantor or any Covered Person for any loss, damage
or claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Preferred Securities
Guarantee and in a manner that such Indemnified Person reasonably believed to be
within the scope of the authority conferred on such Indemnified Person by this
Preferred Securities Guarantee or by law, except that an Indemnified Person
shall be liable for any such loss, damage or claim incurred by reason of such
Indemnified Person's negligence or willful misconduct with respect to such acts
or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts
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<PAGE>
pertinent to the existence and amount of assets from which Distributions to
Holders might properly be paid.
SECTION 8.2 Indemnification
The Guarantor agrees to indemnify each Indemnified Person for, and to hold
each Indemnified Person harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against, or investigating, any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder. The obligation to indemnify as set forth in this Section 8.2 shall
survive the termination of this Preferred Securities Guarantee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
All guarantees and agreements contained in this Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Preferred Securities then outstanding.
SECTION 9.2 Amendments
Except with respect to any changes that do not adversely affect the rights
of Holders (in which case no consent of Holders will be required), this
Preferred Securities Guarantee may be amended only with the prior approval of
the Holders of not less than a Majority in aggregate liquidation amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all the outstanding Preferred Securities.
The provisions of Section 12.2 of the Declaration with respect to meetings of
Holders apply to the giving of such approval.
SECTION 9.3 Notices
All notices provided for in this Preferred Securities Guarantee shall be
in writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:
(a) If given to the Preferred Guarantee Trustee, at the Preferred
Guarantee Trustee's mailing address set forth below (or such other address as
the Preferred Guarantee Trustee may give notice of to the Holders):
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The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, New York 10001
Attention: Sheik Wiltshire
(b) If given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders):
Travelers Group Inc.
388 Greenwich Street
New York, New York 10013
Attention: Charles O. Prince III, Secretary
(c) If given to any Holder, at the address set forth on the books and
records of the Issuer.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 9.4 Benefit
This Preferred Securities Guarantee is solely for the benefit of the
Holders of the Preferred Securities and, subject to Section 3.1(a), is not
separately transferable from the Preferred Securities.
SECTION 9.5 Governing Law
THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, AND ALL
RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD FOR THE
PRINCIPLES OF ITS CONFLICTS OF LAWS.
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THIS PREFERRED SECURITIES GUARANTEE is executed as of the day and year
first above written.
TRAVELERS GROUP INC.,
as Guarantor
By:
-----------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK, as Preferred
Guarantee Trustee
By:
-----------------------------------
Name:
Title:
<PAGE>
FORM OF DEPOSIT AGREEMENT
DEPOSIT AGREEMENT, dated as of _________________________________,
among TRAVELERS GROUP INC., a Delaware corporation,
___________________________, a __________________________trust company, as
Depositary, and all holders from time to time of Depositary Receipts issued
hereunder.
W I T N E S S E T H:
WHEREAS, it is desired to provide, as hereinafter set forth in this
Deposit Agreement, for the deposit of shares of ________________ Preferred
Stock, $1.00 par value, of the Company (the "Stock") with the Depositary, as
agent for the beneficial owners of the Stock, for the purposes set forth in this
Deposit Agreement for the issuance hereunder of the Receipts evidencing
Depositary Shares representing an interest in the Stock so deposited; and
WHEREAS, the Receipts are to be substantially in the form of the
Depositary Receipt annexed as Exhibit A to this Deposit Agreement, with
appropriate insertions, modifications and omissions, as hereinafter provided in
this Depositary Agreement;
NOW, THEREFORE, in consideration of the premises contained herein,
it is agreed by and among the parties hereto as follows:
ARTICLE I
DEFINITIONS
The following definitions shall apply to the respective terms (in
the singular and plural forms of such terms) used in this Deposit Agreement and
the Depositary Receipts:
"Certificate of Designation" shall mean the Certificate of
Designation establishing and setting forth the rights, preferences, privileges
and limitations of the Stock.
"Certificate of Incorporation" shall mean the Certificate of
Incorporation, as the same shall be amended and/or restated from time to time,
of the Company.
"Common Stock" shall mean the Company's Common Stock, par value
$0.01 per share.
"Company" shall mean Travelers Group Inc., a
Delaware corporation, and its successors.
<PAGE>
"Corporate Office" shall mean the office of the Depositary in the
Borough of Manhattan, New York, New York at which at any particular time its
business in respect of matters governed by this Deposit Agreement shall be
administered, which at the date of this Deposit Agreement is located at
___________________________________________.
"Deposit Agreement" shall mean this agreement, as the same may be
amended, modified or supplemented from time to time.
"Depositary" shall mean _________________________________________,
and any successor as depositary hereunder.
"Depositary Share" shall mean an interest in [fraction] of a share
of Stock deposited with the Depositary hereunder and the same proportionate
interest in any and all other property received by the Depositary in respect of
such share of Stock and held under this Deposit Agreement, all as evidenced by
the Receipts issued hereunder. Subject to the terms of this Deposit Agreement,
each owner of a Depositary Share is entitled, proportionately, to all the
rights, preferences and privileges of the Stock represented by such Depositary
Share, including the dividend, voting and liquidation rights contained in the
Certificate of Designation, and to the benefits of all obligations of the
Company under the Certificate of Designation.
"Depositary's Agent" shall mean an agent appointed by the Depositary
as provided, and for the purposes specified, in Section 7.05.
"Receipt" shall mean a Depositary Receipt issued hereunder to
evidence one or more Depositary Shares.
"Record Holder" as applied to a Receipt shall mean the person in
whose name a Receipt is registered on the books maintained by the Depositary for
such purpose.
"Registrar" shall mean any bank or trust company appointed to
register Receipts as herein provided.
"Securities Act" shall mean the Securities Act of
1933, as amended.
"Stock" shall mean shares of the Company's _____________________
Preferred Stock, $1.00 par value, validly issued,
fully paid and nonassessable.
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ARTICLE II
FORM OF RECEIPTS, DEPOSIT OF STOCK, EXECUTION AND
DELIVERY, TRANSFER AND SURRENDER OF RECEIPTS
SECTION 2.01. Form and Transferability of Receipts. Receipts shall
be engraved and printed or lithographed with steel-engraved borders and
underlying tint and shall be substantially in the form set forth in Exhibit A
annexed to this Deposit Agreement, with appropriate insertions, modifications
and omissions, as hereinafter provided. Pending the preparation of definitive
engraved Receipts, the Depositary may, upon the written order of the Company,
issue temporary Receipts substantially identical to (and entitling the holders
thereof to all the rights pertaining to) the definitive Receipts but not in
definitive form. Definitive Receipts will be prepared thereafter and will be
exchangeable for temporary Receipts at the Company's expense, upon surrender of
such temporary Receipts at the Corporate Office. Receipts shall be executed by
the Depositary by the manual signature of a duly authorized signatory of the
Depositary, provided, however, that such signature may be a facsimile if a
Registrar (other than the Depositary) shall have countersigned the Receipts by
manual signature of a duly authorized signatory of the Registrar. No Receipt
shall be entitled to any benefits under this Deposit Agreement or be valid or
obligatory for any purpose unless it shall have been executed as provided in the
preceding sentence. The Depositary shall record on its books each Receipt
executed as provided above and delivered as hereinafter provided.
Except as the Depositary may otherwise determine, Receipts shall be
in denominations of any number of whole Depositary Shares. All Receipts shall be
dated the date of their execution.
Receipts may be endorsed with or have incorporated in the text
thereof such legends or recitals or changes not inconsistent with the provisions
of this Deposit Agreement as may be required by the Depositary or required to
comply with any applicable law or regulation or with the rules and regulations
of any securities exchange upon which the Stock, the Depositary Shares or the
Receipts may be listed or to conform with any usage with respect thereto, or to
indicate any special limitations or restrictions to which any particular
Receipts are subject by reason of the date of issuance of the Stock or
otherwise.
Title to any Receipt (and to the Depositary Shares evidenced by such
Receipt) that is properly endorsed or accompanied by a properly executed
instrument of transfer or endorsement shall be transferable by delivery with the
same
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effect as in the case of a negotiable instrument provided, however, that until a
Receipt shall be transferred on the books of the Depositary as provided in
Section 2.04, the Depositary may, notwithstanding any notice to the contrary,
treat the record holder thereof at such time as the absolute owner thereof for
the purpose of determining the person entitled to distribution of dividends or
other distributions or to any notice provided for in this Deposit Agreement and
for all other purposes.
SECTION 2.02. Deposit of Stock; Execution and Delivery of Receipts
in Respect Thereof. On the date the Stock is initially issued by the Company,
the Depositary, upon receipt of a written order from the Company and a
certificate or certificates for the Stock to be deposited under this Deposit
Agreement in accordance with the provisions of this Section, shall execute and
deliver a Receipt or Receipts for the number of Depositary Shares representing
such deposited Stock to the person or persons stated in such order.
Subject to the terms and conditions of this Deposit Agreement, any
holder of Stock may deposit such Stock under this Deposit Agreement by delivery
to the Depositary of a certificate or certificates for the Stock to be
deposited, properly endorsed or accompanied, if required by the Depositary, by a
properly executed instrument of transfer or endorsement in form satisfactory to
the Depositary, together with (i) all such certifications as may be required by
the Depositary in accordance with the provisions of this Deposit Agreement and
(ii) a written order directing the Depositary to execute and deliver to or upon
the written order of the person or persons stated in such order a Receipt or
Receipts for the number of Depositary Shares representing such deposited Stock.
If required by the Depositary, Stock presented for deposit at any
time, whether or not the register of stockholders of the Company is closed,
shall also be accompanied by an agreement or assignment, or other instrument
satisfactory to the Depositary, that will provide for the prompt transfer to the
Depositary or its nominee of any dividend or right to subscribe for additional
Stock or to receive other property that any person in whose name the Stock is or
has been registered may thereafter receive upon or in respect of such deposited
Stock, or in lieu thereof such agreement of indemnity or other agreement as
shall be satisfactory to the Depositary.
Upon receipt by the Depositary of a certificate or certificates for
Stock to be deposited hereunder, together with the other documents specified
above, the Depositary shall, as soon as transfer and registration can be
accomplished, present such certificate or certificates to the registrar and
transfer agent of the Stock for transfer and
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<PAGE>
registration in the name of the Depositary or its nominee of the Stock being
deposited. Deposited Stock shall be held by the Depositary in an account to be
established by the Depositary at the Corporate Office.
Upon receipt by the Depositary of a certificate or certificates for
Stock to be deposited hereunder, together with the other documents specified
above, the Depositary, subject to the terms and conditions of this Deposit
Agreement, shall execute and deliver to or upon the order of the person or
persons named in the written order delivered to the Depositary referred to in
the first or second paragraph of this Section 2.02 a Receipt or Receipts for the
number of whole Depositary Shares representing the Stock so deposited and
registered in such name or names as may be requested by such person or persons.
The Depositary shall execute and deliver such Receipt or Receipts at the
Corporate Office, except that, at the request, risk and expense of any person
requesting such delivery, such delivery may be made at such other place as may
be designated by such person. In each case, delivery will be made upon payment
by such person to the Depositary of all taxes and other governmental charges and
any fees in connection with such deposit and the transfer of the Deposited
Stock.
The Company shall deliver to the Depositary from time to time such
quantities of Receipts as the Depositary may reasonably request to enable the
Depositary to perform its obligations under this Deposit Agreement.
SECTION 2.03. Redemptions and Conversions of Stock. (a) Whenever the
Company shall elect or be required to redeem or convert shares of Stock in
accordance with the Certificate of Designation, it shall (unless otherwise
agreed in writing with the Depositary) give the Depositary in its capacity as
Depositary not less than 10 days' prior notice of the proposed date of the
mailing of a notice of redemption or conversion of Depositary Shares to holders
of Receipts to be affected in connection with a redemption or conversion of
Stock and of the number of such shares of Stock held by the Depositary to be
redeemed or converted as hereinafter provided. On the date of any such
redemption or conversion of Stock, provided that the Company shall then have
deposited with the Depositary the shares of Common Stock and any funds required
pursuant to the Certificate of Designation for the Stock deposited with the
Depositary to be redeemed or converted, the Depositary shall redeem or convert
(using the shares of Common Stock and funds, if any, deposited with it), the
number of Depositary Shares representing such redeemed or converted Stock. The
Depositary shall, as directed by the Company, mail, first class postage prepaid,
notice of the redemption or conversion of Stock and the proposed simultaneous
redemption or conversion of the Depositary Shares representing the Stock to be
redeemed or
5
<PAGE>
converted, not less than 30 and not more than 90 days prior to the date fixed
for redemption or conversion (the "redemption or conversion date") of such Stock
and Depositary Shares. Such notice shall be mailed to each holder of record on
the record date fixed for such redemption or conversion pursuant to Section 4.04
hereof of the Receipts evidencing the Depositary Shares to be so redeemed or
converted, at the address of such holder as the same appears on the records of
the Depositary; but neither failure to mail such notice to one or more such
holders nor any defect in any notice shall affect the sufficiency of the
proceedings for redemption or conversion. The Company shall provide the
Depositary with such notice, and each such notice shall state: the record date
for such redemption or conversion; the redemption or conversion date; the
Redemption Price or the Conversion Price (as defined below); that all
outstanding Depositary Shares are to be redeemed or converted or, in the case of
a redemption or conversion of fewer than all outstanding Depositary Shares in
connection with a partial redemption or conversion of Stock pursuant to
paragraph ___________ of the Certificate of Designation, the number of such
Depositary Shares held by such holder to be so redeemed or converted; the number
of shares of Common Stock deliverable upon conversion; the place or places where
Receipts evidencing Depositary Shares to be redeemed or converted are to be
surrendered for redemption or conversion; and that dividends in respect of the
Stock represented by the Depositary Shares to be redeemed or converted will
cease to accrue on such redemption or conversion date, unless the Company shall
default in delivering the shares of Common Stock and cash, if any, payable by
the Company at the time and place specified in such notice. In case fewer than
all the outstanding Depositary Shares are to be redeemed or converted, the
Depositary Shares to be redeemed or converted shall be selected by lot or pro
rata (as nearly as may be practicable without creating fractional shares) or by
any other equitable method determined by the Company. For purposes of this
Deposit Agreement, the terms "Redemption Price" and "Conversion Price" shall
each have the meaning assigned to it in the Certificate of Designation.
Notice having been mailed by the Depositary as aforesaid, from and
after the redemption or conversion date (unless the Company shall have failed to
redeem or convert the shares of Stock to be redeemed or converted by it as set
forth in the Company's notice provided for in the preceding paragraph), the
Depositary Shares called for redemption or conversion shall be deemed no longer
to be outstanding and all rights of the holders of Receipts evidencing such
Depositary Shares (except the right to receive the shares of Common Stock and
any cash upon redemption or conversion) shall, to the extent of such Depositary
Shares, cease and terminate. Upon surrender in accordance with said notice of
the Receipts evidencing such Depositary Shares (properly endorsed or
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<PAGE>
assigned for transfer, if the Depositary shall require), such Depositary Shares
shall be converted (as nearly as may be practicable without creating fractional
shares) into shares of Common Stock at a conversion rate equal to [fraction] of
the number of shares of Common Stock delivered in respect of the shares of Stock
represented by such Depositary Shares pursuant to the Certificate of
Designation. The foregoing shall be subject further to the terms and conditions
of the Certificate of Designation.
If fewer then all of the Depositary Shares evidenced by a Receipt
are called for redemption or conversion, the Depositary will deliver to the
holder of such Receipt upon its surrender to the Depositary, together with the
funds and/or shares of Common Stock for the Depositary Shares called for
redemption or conversion, a new Receipt evidencing the Depositary Shares
evidenced by such prior Receipt and not called for redemption or conversion.
To the extent that Depositary Shares are converted into shares of
Common Stock and all of such shares of Common Stock cannot be distributed to the
record holders of Receipts without creating fractional interests in such shares,
the Depositary may, with the consent of the Company, adopt such method as it
deems equitable and practicable for the purpose of effecting such distribution,
including the sale (at public or private sale) of such shares of Common Stock
representing in the aggregate such fractional interests at such place or places
and upon such terms as it may deem proper, and the net proceeds of any such sale
shall, subject to Section 3.02, be distributed or made available for
distribution to such record holders that would otherwise receive fractional
interests in such shares of Common Stock.
The Depositary shall not be required (i) to issue, transfer or
exchange any Receipts for a period beginning at the opening of business 10 days
next preceding any selection of Depositary Shares and Stock to be redeemed or
converted and ending at the close of business on the day of the mailing of
notice of redemption or conversion of Depositary Shares or (ii) to transfer or
exchange for another Receipt or Stock any Receipt evidencing Depositary Shares
called or being called for redemption or conversion in whole or in part, except
as provided in the second preceding paragraph of this Section 2.03.
(b) Whenever a record holder of Receipts shall duly deliver, in
person or by a duly authorized attorney, such Receipts (properly endorsed or
assigned for transfer, as the Depositary shall require) to the Depositary at the
Depositary's Corporate Office, together with written notice of such record
holder's election to convert the Depositary Shares evidenced by such Receipts
(provided that any delivery of
7
<PAGE>
Receipts evidencing Depositary Shares that have been called for redemption by
the Company may not be made after the close of business on the business day
prior to the applicable redemption date), the Depositary shall promptly notify
the Company of such record holder's election and deliver to the Company
certificates evidencing such shares of Stock as are represented by the
Depositary Shares evidenced by such Receipts delivered by such record holder for
conversion. From and after the close of business of any business day on which a
record holder duly delivers the foregoing documents to the Depositary, upon
surrender of the Receipts evidencing Depositary Shares, such Depositary Shares
shall by converted by the Depositary at a Conversion Price to be determined by
the Company and communicated to the Depositary in writing, which Conversion
Price will be equal to [fraction] of all sums of money, stock and other property
paid per share by the Company in respect of each share of Stock, all dividends
in respect of the shares of Stock converted by such record holder shall cease to
accrue, the Depositary Shares being converted shall be deemed no longer to be
outstanding, and all rights of such record holder (except the right to receive
the Conversion Price) shall, to the extent of such Depositary Shares, cease and
terminate. If Receipts duly delivered by a record holder evidence a number of
Depositary Shares in excess of the number to be converted, the Depositary will
deliver to such holder of such Receipts, upon their surrender to the Depositary,
together with the payment of the Conversion Price, a new Receipt evidencing such
excess number of Depositary Shares.
SECTION 2.04. Transfer of Receipts. Subject to the terms and
conditions of this Deposit Agreement, the Depositary shall make transfers on its
books from time to time of Receipts upon any surrender thereof by the holder in
person or by a duly authorized attorney, properly endorsed or accompanied by a
properly executed instrument of transfer or endorsement, together with evidence
of the payment of any transfer taxes as may be required by law. Upon such
surrender, the Depositary shall execute a new Receipt or Receipts and deliver
the same to or upon the order of the person entitled thereto evidencing the same
aggregate number of Depositary Shares evidenced by the Receipt or Receipts
surrendered.
SECTION 2.05. Combination and Split-ups of Receipts. Upon surrender
of a Receipt or Receipts at the Corporate Office or such other office as the
Depositary may designate for the purpose of effecting a split-up or combination
of Receipts, subject to the terms and conditions of this Deposit Agreement, the
Depositary shall execute and deliver a new Receipt or Receipts in the authorized
denominations requested evidencing the same aggregate number of Depositary
Shares evidenced by the Receipt or Receipts
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<PAGE>
surrendered; provided, however, the Depositary shall not issue any Receipt
evidencing a fractional Depositary Share.
SECTION 2.06. Surrender of Receipts and Withdrawal of Stock. Any
holder of a Receipt or Receipts may withdraw any or all of the Stock (but only
in whole shares of Stock) represented by the Depositary Shares evidenced by such
Receipts and all money and other property, if any, represented by such
Depositary Shares by surrendering such Receipt or Receipts at the Corporate
Office or at such other office as the Depositary may designate for such
withdrawals. After such surrender, without unreasonable delay, the Depositary
shall deliver to such holder, or to the person or persons designated by such
holder as hereinafter provided, the whole number of shares of Stock and all such
money and other property, if any, represented by the Depositary Shares evidenced
by the Receipt or Receipts so surrendered for withdrawal. If the Receipt or
Receipts delivered by the holder to the Depositary in connection with such
withdrawal shall evidence a number of Depositary Shares in excess of the number
of Depositary Shares representing the whole number of shares of Stock to be
withdrawn, the Depositary shall at the same time, in addition to such whole
number of shares of Stock and such money and other property, if any, to be
withdrawn, deliver to such holder, or (subject to Section 2.04) upon his order,
a new Receipt or Receipts evidencing such excess number of Depositary Shares.
Delivery of the Stock and such money and other property being withdrawn may be
made by the delivery of such certificates, documents of title and other
instruments as the Depositary may deem appropriate, which, if required by the
Depositary, shall be properly endorsed or accompanied by proper instruments of
transfer.
If the Stock and the money and other property being withdrawn are to
be delivered to a person or persons other than the record holder of the Receipt
or Receipts being surrendered for withdrawal of Stock, such holder shall execute
and deliver to the Depositary a written order so directing the Depositary and
the Depositary may require that the Receipt or Receipts surrendered by such
holder for withdrawal of such shares of Stock be properly endorsed in blank or
accompanied by a properly executed instrument of transfer or endorsement in
blank.
The Depositary shall deliver the Stock and the money and other
property, if any, represented by the Depositary Shares evidenced by Receipts
surrendered for withdrawal at the Corporate Office, except that, at the request,
risk and expense of the holder surrendering such Receipt or Receipts and for the
account of the holder thereof, such delivery may be made at such other place as
may be designated by such holder.
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Holders of Depositary Shares shall be entitled to receive whole
shares of the related series of Stock, but holders of such whole shares of Stock
will not thereafter be entitled to deposit such shares of Stock with the
Depositary or to receive Depositary Shares therefor.
SECTION 2.07. Limitation on Execution and Delivery, Transfer,
Split-up, Combination, Surrender and Exchange of Receipts. As a condition
precedent to the execution and delivery, transfer, split-up, combination,
surrender or exchange of any Receipts, the Depositary, any of the Depositary's
Agents or the Company may require any or all of the following: (i) payment to it
of a sum sufficient for the payment (or, in the event that the Depositary or the
Company shall have made such payment, the reimbursement to it) of any tax or
other governmental charge with respect thereto (including any such tax or charge
with respect to the Stock being deposited or withdrawn or with respect to the
Common Stock or other securities or property of the Company being issued upon
redemption or conversion); (ii) the production of proof satisfactory to it as to
the identity and genuineness of any signature; and (iii) compliance with such
regulations, if any, as the Depositary or the Company may establish not
inconsistent with the provisions of this Deposit Agreement.
The deposit of Stock may be refused, the delivery of Receipts
against Stock may be suspended, the transfer of Receipts may be refused, and the
transfer, split-up, combination, surrender or exchange of outstanding Receipts
may be suspended (i) during any period when the register of stockholders of the
Company has closed, (ii) if any such action is deemed necessary or advisable by
the Depositary, any of the Depositary's Agents or the Company at any time or
from time to time because of any requirement of law or of any government or
governmental body or commission, or under any provision of this Deposit
Agreement, or (iii) with the approval of the Company, for any other reason.
Without limitation of the foregoing, the Depositary shall not knowingly accept
for deposit under this Deposit Agreement any shares of Stock that are required
to be registered under the Securities Act unless a registration statement under
the Securities Act is in effect as to such shares of Stock.
SECTION 2.08. Lost Receipts, etc. In case any receipt shall be
mutilated or destroyed or lost or stolen, the Depositary in its discretion may
execute and deliver a Receipt of like form and tenor in exchange and
substitution for such mutilated Receipt or in lieu of and in substitution for
such destroyed, lost or stolen receipt provided, however, that the holder
thereof provides the Depositary with (i) evidence satisfactory to the Depositary
of such destruction, loss or theft of such Receipt, of the authenticity thereof
and of his ownership thereof, (ii) reasonable indemnification
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satisfactory to the Depositary and (iii) payment of any expense (including fees,
charges and expenses of the Depositary) in connection with such execution and
delivery.
SECTION 2.09. Cancellation and Destruction of Surrendered Receipts.
All Receipts surrendered to the Depositary or any Depositary's Agent shall be
canceled by the Depositary. Except as prohibited by applicable law or
regulation, the Depositary is authorized to destroy such Receipts so canceled,
and provide the Company a certificate of destruction therefor.
ARTICLE III
CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY
SECTION 3.01. Filing Proofs, Certificates and Other Information. Any
person presenting Stock for deposit or any holder of a Receipt may be required
from time to time to file such proof of residence or other information, to
execute such certificates and to make such representations and warranties as the
Depositary or the Company may reasonably deem necessary or proper. The
Depositary or the Company may withhold or delay the delivery of any Receipt, the
transfer, redemption or exchange of any Receipt, the withdrawal of the Stock
represented by the Depositary Shares evidenced by any Receipt or the
distribution of any dividend or other distribution until such proof or other
information is filed, such certificates are executed or such representations and
warranties are made.
SECTION 3.02. Payment Of Taxes and Other Governmental Charges. If
any tax or other governmental charge shall become payable by or on behalf of the
Depositary with respect to any Receipt, the Depositary Shares evidenced by such
Receipt, the Stock (or fractional interest therein) represented by such
Depositary Shares or any transaction referred to in Section 4.06, such tax
(including transfer, issuance or acquisition taxes, if any) or governmental
charge shall be payable by the holder of such Receipt. Until such payment is
made, transfer of any Receipt or any withdrawal of the Stock or money or other
property, if any, represented by the Depositary Shares evidenced by such Receipt
may be refused, any dividend or other distribution may be withheld and any part
or all of the Stock or other property represented by the Depositary Shares
evidenced by such Receipt may be sold for the account of the holder thereof
(after attempting by reasonable means to notify such holder prior to such sale).
Any dividend or other distribution so withheld and the proceeds of any such sale
may be applied to any payment of such tax or other governmental charge, the
holder of such Receipt remaining liable for any deficiency. The Depositary
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shall act as the withholding agent for any payments, distributions and exchanges
made with respect to the Depositary Shares and Receipts, and the Stock, Common
Stock or other securities or assets represented thereby (collectively, the
"Securities"). The Depositary shall be responsible with respect to the
Securities for the timely (i) collection and deposit of any required withholding
or backup withholding tax, and (ii) filing of any information returns or other
documents with federal (and other applicable) taxing authorities. In the event
the Depositary is required to pay any such amounts, the Company shall reimburse
the Depositary for payment thereof upon the request of the Depositary and the
Depositary shall, upon the Company's request and as instructed by the Company,
pursue its rights against such holder at the Company's expense.
SECTION 3.03. Representations and Warranties as to Stock. In the
case of the initial deposit of the Stock, the Company and, in the case of
subsequent deposits thereof, each person so depositing Stock under this Deposit
Agreement shall be deemed thereby to represent and warrant that such Stock and
each certificate therefor are valid, fully paid and nonassessable and that the
person making such deposit is duly authorized to do so. Such representations and
warranties shall survive the deposit of the Stock and the issuance of Receipts.
ARTICLE IV
THE STOCK, NOTICES
SECTION 4.01. Cash Distributions. Whenever the Depositary shall receive
any cash dividend or other cash distribution on the Stock, the Depositary shall,
subject to Section 3.02, distribute to record holders of Receipts on the record
date fixed pursuant to Section 4.04 such amounts of such sum as are, as nearly
as practicable, in proportion to the respective numbers of Depositary Shares
evidenced by the Receipts held by such holders; provided, however, that in case
the Company or the Depositary shall be required to withhold and does withhold
from any cash dividend or other cash distribution in respect of the Stock an
amount on account of taxes or as otherwise required pursuant to law, regulation
or court process, the amount made available for distribution or distributed in
respect of Depositary Shares shall be reduced accordingly. In the event that the
calculation of any such cash dividend or other cash distribution to be paid to
any record holder on the aggregate number of Receipts held by such holder
results in an amount which is a fraction of a cent, the amount that the
Depositary shall distribute to such record holder shall be rounded to the next
highest whole cent and, upon request by the Depositary, the Company shall pay
such additional amount to the Depositary for distribution.
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SECTION 4.02. Distributions Other Than Cash. Whenever the Depositary
shall receive any distribution other than cash on the Stock, the Depositary
shall, subject to Section 3.02, distribute to record holders of Receipts on the
record date fixed pursuant to Section 4.04 such amounts of the securities or
property received by it as are, as nearly as practicable, in proportion to the
respective numbers of Depositary Shares evidenced by the Receipts held by such
holders, in any manner that the Depositary and the Company may deem equitable
and practicable for accomplishing such distribution. If, in the opinion of the
Depositary after consultation with the Company, such distribution cannot be made
proportionately among such record holders, or if for any other reason (including
any requirement that the Company or the Depositary withhold an amount on account
of taxes or as otherwise required pursuant to law, regulation or court process),
the Depositary deems, after consultation with the Company, such distribution not
to be feasible, the Depositary may, with the approval of the Company, adopt such
method as it deems equitable and practicable for the purpose of effecting such
distribution, including the sale (at public or private sale) of the securities
or property thus received, or any part thereof, at such place or places and upon
such terms as it may deem proper. The net proceeds of any such sale shall,
subject to Section 3.02, be distributed or made available for distribution, as
the case may be, by the Depositary to record holders of Receipts as provided by
Section 4.01 in the case of a distribution received in cash.
SECTION 4.03. Subscription Rights, Preferences or Privileges. If the
Company shall at any time offer or cause to be offered to the persons in whose
names Stock is registered on the books of the Company any rights, preferences or
privileges to subscribe for or to purchase any securities or any rights,
preferences or privileges of any other nature, such rights, preferences or
privileges shall in each such instance be made available by the Depositary to
the record holders of Receipts if the Company so directs in such manner as the
Company shall instruct (including by the issue to such record holders of
warrants representing such rights, preferences or privileges); provided,
however, that (a) if at the time of issue or offer of any such rights,
preferences or privileges the Company determines that it is not lawful or
feasible to make such rights, preferences or privileges available to some or all
holders of Receipts (by the issue of warrants or otherwise) or (b) if and to the
extent instructed by holders of Receipts who do not desire to exercise such
rights, preferences or privileges, the Depositary shall then, if so instructed
by the Company, and if applicable laws or the terms of such rights, preferences
or privileges so permit, sell such rights, preferences or privileges of such
holders at public or private sale, at such place or places and upon such terms
as it may deem proper. The net proceeds of any such
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sale shall be distributed by the Depositary to the record holders of Receipts
entitled thereto as provided by Section 4.01 in the case of a distribution
received in cash.
If registration under the Securities Act of the securities to which
any rights, preferences or privileges relate is required in order for holders of
Receipts to be offered or sold such securities, the Company shall promptly file
a registration statement pursuant to the Securities Act with respect to such
rights, preferences or privileges and securities and use its best efforts and
take all steps available to it to cause such registration statement to become
effective sufficiently in advance of the expiration of such rights, preferences
or privileges to enable such holders to exercise such rights, preferences or
privileges. In no event shall the Depositary make available to the holders of
Receipts any right, preference or privilege to subscribe for or to purchase any
securities unless and until the Depositary has been notified by the Company that
such registration statement has become effective or that the offering and sale
of such securities to such holders are exempt from registration under the
provisions of the Securities Act. If any other action under the law of any
jurisdiction or any governmental or administrative authorization, consent or
permit is required in order for such rights, preferences or privileges to be
made available to holders of Receipts, the Company will use its best efforts to
take such action or obtain such authorization, consent or permit sufficiently in
advance of the expiration of such rights, preferences or privileges to enable
such holders to exercise such rights, preferences or privileges.
SECTION 4.04. Notice of Dividends, Fixing of Record Date for Holders
of Receipts. Wherever any cash dividend or other cash distribution shall become
payable, any distribution other than cash shall be made, or any rights,
preferences or privileges shall at any time be offered with respect to the
Stock, or whenever the Depositary shall receive notice of (i) any meeting at
which holders of Stock are entitled to vote or of which holders of Stock are
entitled to notice or any solicitation of consents in respect of the Stock or
(ii) any call or conversion of any shares of Stock, the Depositary shall in each
such instance fix a record date (which shall be the same date as the record date
fixed by the Company with respect to the Stock) for the determination of the
holders of Receipts who shall be entitled (i) to receive such dividend,
distribution, rights, preferences or privileges or the net proceeds of the sale
thereof, (ii) to receive notice of, and to give instructions for the exercise of
voting rights at or the delivery of consents with respect to, any such meeting
or consent solicitation, as the case may be, or (iii) to receive notice of any
such call or conversion.
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SECTION 4.05. Voting Rights. Upon receipt of notice of any meeting
at which the holders of Stock are entitled to vote or any solicitation of
consents in respect of the Stock, the Depositary shall, as soon as practicable
thereafter, mail to the record holders of Receipts a notice, which shall be
provided by the Company and which shall contain (i) such information as is
contained in such notice of meeting or consent solicitation, (ii) a statement
that the holders of Receipts at the close of business on a specified record date
fixed pursuant to Section 4.04 will be entitled, subject to any applicable
provision of law, the Certificate of Incorporation or the Certificate of
Designation, to instruct the Depositary as to the exercise of the voting rights
or the delivery of consents with respect to the amount of Stock represented by
their respective Depositary Shares and (iii) a brief statement as to the manner
in which such instructions may be given. Upon the written request of a holder of
a Receipt on such record date, the Depositary shall endeavor insofar as
practicable to vote or cause to be voted or deliver a consent with respect to
the amount of Stock represented by the Depositary Shares evidenced by such
Receipt in accordance with the instructions set forth in such request, and the
Company will take all reasonable action which may be deemed necessary by the
Depositary in order for the Depositary to do so. The Depositary will vote
Depositary Shares in accordance with specific instructions given by the holders
thereof, and will vote all Depositary Shares proportionately for which no
instructions are received.
SECTION 4.06. Changes Affecting Stock and Reclassification,
Recapitalization, etc. Upon any split-up, consolidation or any other
reclassification of Stock, or upon any recapitalization, reorganization, merger,
amalgamation or consolidation affecting the Company or to which it is a party or
sale of all or substantially all of the Company's assets, the Depositary shall,
upon the instructions of the Company, treat any shares of stock or other
securities or property (including cash) that shall be received by the Depositary
in exchange for or upon conversion of or in respect of the Stock as new
deposited property under this Deposit Agreement, and Receipts then outstanding
shall thenceforth represent the proportionate interests of holders thereof in
the new deposited property so received in exchange for or upon conversion or in
respect of such Stock. In any such case the Depositary may in its discretion,
with the approval of the Company, execute and deliver additional Receipts, or
may call for the surrender of all outstanding Receipts to be exchanged for new
Receipts specifically describing such new deposited property.
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ARTICLE V
THE DEPOSITARY AND THE COMPANY
SECTION 5.01. Maintenance of Offices, Agencies, Transfer Books by
the Depositary; the Registrar. Upon execution of this Deposit Agreement in
accordance with its terms, the Depositary shall maintain at the Corporate Office
facilities for the execution and delivery, transfer, surrender and exchange,
split-up, combination and redemption of Receipts and the deposit and withdrawal
of Stock and at the offices of the Depositary's Agents, if any, facilities for
the delivery, transfer, surrender and exchange, split-up, combination and
redemption of Receipts and the deposit and withdrawal of Stock, all in
accordance with the provisions of this Deposit Agreement.
The Depositary shall keep books at the Corporate Office for the
registration and transfer of Receipts, which books at all reasonable times shall
be open for inspection by the record holders of Receipts during normal business
hours as and to the extent provided by applicable law. The Depositary shall
consult with the Company upon receipt of any request for inspection. The
Depositary may close such books, at any time or from time to time, when deemed
expedient by it in connection with the performance of its duties hereunder.
The Depositary shall make available for inspection by holders of
Receipts at the Corporate Office and at such other places as it may from time to
time deem advisable during normal business hours any reports and communications
received from the Company that are both received by the Depositary as the holder
of Stock and made generally available to the holders of Stock.
Promptly upon request from time to time by the Company and at the
Company's sole expense, the Depositary shall furnish to it a list, as of a
recent date, of the names, addresses and holdings of Depositary Shares of all
persons in whose names Receipts are registered on the books of the Depositary.
If the Receipts or the Depositary Shares evidenced thereby or the
Stock represented by such Depositary Shares shall be listed on the New York
Stock Exchange, Inc., the Depositary may, with the approval of the Company,
appoint a Registrar for registry of such Receipts of Depositary Shares in
accordance with the requirements of such Exchange. Such Registrar (which may be
the Depositary if so permitted by the requirements of such Exchange) may be
removed and a substitute registrar appointed by the Depositary upon the request
or with the approval of the Company. If the Receipts, such Depositary Shares or
such Stock are listed on one or more other stock
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exchanges, the Depositary will, at the request and at the expense of the
Company, arrange such facilities for the delivery, transfer, surrender and
exchange of such Receipts, such Depositary Shares or such Stock as may be
required by law or applicable stock exchange regulations.
SECTION 5.02. Liability of the Depositary, the Depositary's Agents
or the Company. Neither the Depositary nor any Depositary's Agents nor the
Company shall incur any liability to any holder of any Receipt, if by reason of
any provision of any present or future law or regulation thereunder of the
United States of America or of any other governmental authority or, in the case
of the Depositary or the Depositary's Agent, by reason of any provision, present
or future, of the Certificate of Incorporation or the Certificate of Designation
or, in the case of the Company, the Depositary or the Depositary's Agent, by
reason of any act of God or war or other circumstances beyond the control of the
relevant party, the Depositary, any Depositary's Agent or the Company shall be
prevented or forbidden from doing or performing any act or thing that the terms
of this Deposit Agreement provide shall be done or performed; nor shall the
Depositary, any Depositary's Agent or the Company incur any liability to any
holder of a Receipt by reason of any nonperformance or delay, caused as
aforesaid, in the performance of any act or thing that the terms of this Deposit
Agreement provide shall or may be done or performed, or by reason of any
exercise of, or failure to exercise, any discretion provided for in this Deposit
Agreement.
SECTION 5.03. Obligations of the Depositary, the Depositary's Agents and
the Company. Neither the Depositary nor any Depositary's Agent nor the Company
assumes any obligation or shall be subject to any liability under this Deposit
Agreement or any Receipt to holders of Receipts other than that each of them
agrees to use good faith in the performance of such duties as are specifically
set forth in this Deposit Agreement.
Neither the Depositary nor any Depositary's Agent nor the Company
shall be under any obligation to appear in, prosecute or defend any action, suit
or other proceeding with respect to Stock, Depositary Shares, Receipts or Common
Stock that in its opinion may involve it in expense or liability, unless
indemnity satisfactory to it against all expense and liability be furnished as
often as may be required.
Neither the Depositary nor any Depositary's Agent nor the Company
shall be liable for any action or any failure to act by it in reliance upon the
advice of or information from legal counsel, accountants, any person presenting
Stock for deposit, any holder of a Receipt or any other person believed by it in
good faith to be competent to give such
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advice or information. The Depositary, any Depositary's Agent and the Company
may each rely and shall each be protected in acting upon any written notice,
request, direction or other document believed by it to be genuine and to have
been signed or presented by the proper party or parties.
The Depositary, its parent, affiliate or subsidiaries and any
Depositary's Agent may own, buy, sell or deal in any class of securities of the
Company and its affiliates and in Receipts or Depositary Shares or become
pecuniarily interested in any transaction in which the Company or its affiliates
may be interested or contract with or lend money to or otherwise act as fully or
as freely as if it were not the Depositary or the Depositary's Agent hereunder.
The Depositary may also act as transfer agent or registrar of any of the
securities of the Company and its affiliates or act in any other capacity for
the Company or its affiliates.
It is intended that neither the Depositary nor any Depositary's
Agent shall be deemed to be an "issuer" of the securities under the federal
securities laws or applicable state securities laws, it being expressly
understood and agreed that the Depositary and any Depositary's Agent are acting
only in a ministerial capacity as Depositary for the Stock.
The Depositary agrees to comply with all information reporting and
withholding requirements applicable to it under law or this Deposit Agreement in
its capacity as Depositary.
Neither the Depositary (or its officers, directors, employees or
agents) nor any Depositary's Agent makes any representation or has any
responsibility as to the validity of the Registration Statement pursuant to
which the Depositary Shares are registered under the Securities Act, the Stock,
the Depositary Shares or the Receipts (except its countersignature thereon), or
any instruments referred to therein or herein, or as to the correctness of any
statement made therein or herein; provided, however, that the Depositary is
responsible for its representations in this Deposit Agreement.
Except for the Depositary's certification of registered ownership,
the Depositary assumes no responsibility for the correctness of the description
that appears in the Receipts, which can be taken as a statement of the Company
with respect to certain provisions of this Deposit Agreement. Notwithstanding
any other provision herein or in the Receipts, the Depositary makes no
warranties or representations as to the validity, genuineness or sufficiency of
any Stock at any time deposited with the Depositary hereunder or of the
Depositary Shares, as to the validity or sufficiency of this Deposit Agreement,
as to the value of the Depositary Shares or as to any right, title or interest
of the record holders of
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Receipts in and to the Depositary Shares, except that the Depositary hereby
represents and warrants as follows: (i) the Depositary has been duly organized
and is validly existing and in good standing under the laws of the State of
______________ , with full power, authority and legal right under such law to
execute, deliver and carry out the terms of this Deposit Agreement; (ii) this
Deposit Agreement has been duly authorized, executed and delivered by the
Depositary; and (iii) this Deposit Agreement constitutes a valid and binding
obligation of the Depositary, enforceable against the Depositary in accordance
with its terms, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting enforcement of
creditors' rights generally and except as enforcement thereof is subject to
general principles of equity (regardless of whether enforcement is considered in
a proceeding in equity or at law). The Depositary shall not be accountable for
the use or application by the Company of the Depositary Shares or the Receipts
or the proceeds thereof.
SECTION 5.04. Resignation and Removal of the Depositary, Appointment
of Successor Depositary. The Depositary may at any time resign as Depositary
hereunder by notice of its election to do so delivered to the Company, such
resignation to take effect upon the appointment of a successor depositary and
its acceptance of such appointment as hereinafter provided.
The Depositary may at any time be removed by the Company by notice
of such removal delivered to the Depositary, such removal to take effect upon
the appointment of a successor depositary and its acceptance of such appointment
as hereinafter provided.
In case at any time the Depositary acting hereunder shall resign or
be removed, the Company shall, within 60 days after the delivery of the notice
of resignation or removal, as the case may be, appoint a successor depositary,
which shall be a bank or trust company, or an affiliate of a bank or trust
company, having its principal office in the United States of America and having
a combined capital and surplus of at least $50,000,000. If a successor
depositary shall not have been appointed in 60 days, the resigning depositary
may petition a court of competent jurisdiction to appoint a successor
depositary. Every successor depositary shall execute and deliver to its
predecessor and the Company an instrument in writing accepting its appointment
hereunder, and thereupon such successor depositary, without any further act or
deed, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor and for all purposes shall be the Depositary
under this Deposit Agreement, and such predecessor, upon payment of all sums due
it and on the written request of the Company, shall promptly execute and
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deliver an instrument transferring to such successor all rights and powers of
such predecessor hereunder, shall duly assign, transfer and deliver all rights,
title and interest in the Stock and any moneys or property held hereunder to
such successor and shall deliver to such successor a list of the record holders
of all outstanding Receipts. Any successor depositary shall promptly mail notice
of its appointment to the record holders of Receipts.
Any corporation into or with which the Depositary may be merged,
consolidated or converted shall be the successor of each Depositary without the
execution or filing of any document or any further act. Such successor
depositary may execute the Receipts either in the name of the predecessor
depositary or in the name of the successor depositary.
SECTION 5.05. Corporate Notices and Reports. The Company agrees that
it will deliver to the Depositary, and the Depositary will, promptly after
receipt thereof, transmit to the record holders of Receipts, in each case at the
addresses recorded in the Depositary's books, copies of all notices and reports
(including financial statements) required by law, by the rules of any national
securities exchange upon which the Stock, the Depositary Shares or the Receipts
are listed or by the Certificate of Incorporation and the Certificate of
Designation to be furnished by the Company to holders of Stock. Such
transmission will be at the Company's expense and the Company will provide the
Depositary with such number of copies of such documents as the Depositary may
reasonably request. In addition, the Depositary will transmit to the record
holders of Receipts at the Company's expense such other documents as may be
requested by the Company.
SECTION 5.06. Deposit of Stock by the Company. Neither the Company
nor any company controlled by the Company will at any time deposit any Stock if
such Stock is required to be registered under the provisions of the Securities
Act and no registration statement is at such time in effect as to such Stock.
SECTION 5.07. Indemnification by the Company. The Company agrees to
indemnify the Depositary, any Depositary's Agent and any Registrar against, and
hold each of them harmless from, any liability, costs and expenses (including
reasonable attorneys' fees) that may arise out of or in connection with its
acting as Depositary, Depositary's Agent or Registrar, respectively, under this
Deposit Agreement and the Receipts, except for any liability arising out of
negligence, bad faith or willful misconduct on the part of any such person or
persons.
SECTION 5.08. Fees, Charges and Expenses. No fees, charges and
expenses of the Depositary or any Depositary's
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Agent hereunder or of any Registrar shall be payable by any person other than
the Company, except for any taxes and other governmental charges and except as
provided in this Deposit Agreement. If the Depositary incurs fees, charges or
expenses for which it is not otherwise liable hereunder at the election of a
holder of a Receipt or other person, such holder or other person will be liable
for such fees, charges and expenses. All other fees, charges, and expenses of
the Depositary and any Depositary's Agent hereunder and of any Registrar
(including, in each case, fees and expenses of counsel) incident to the
performance of their respective obligations hereunder will be paid from time
to time upon consultation and agreement between the Depositary and the Company
as to the amount and nature of such fees, charges and expenses.
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. Amendment. The form of the Receipts and any provision
of this Deposit Agreement may at any time and from time to time be amended by
agreement between the Company and the Depositary to cure any ambiguity or to
correct or supplement any provision contained herein or in the Receipts which
may be defective or inconsistent with any other provision contained herein or
therein, or to make any other provision in regard to matters or questions
arising hereunder which the Board of Directors of the Company may deem necessary
or desirable and which shall not adversely affect the interests of the holders
of the Depositary Shares or the Stock. Any amendment that shall impose any fees,
taxes or charges (other than fees and charges provided for herein or in the
Receipts), or that shall otherwise materially and adversely alter any
substantial existing right of holders of Depositary Shares, shall become
effective as to outstanding Depositary Shares only upon obtaining the consent of
holders of not less than a majority of the affected Depositary Shares then
outstanding. The Depositary shall in consultation with the Company establish a
record date and provide to holders of Depositary Shares on such record date the
opportunity to consent to any such amendment in a manner consistent with Section
4.05 of this Deposit Agreement. The Depositary shall vote Depositary Shares in
accordance with the last sentence of Section 4.05. In no event shall any
amendment impair the right, subject to the provisions of Sections 2.03, 2.06 and
2.07 and Article III, of any owner of any Depositary Shares to surrender the
Receipt evidencing such Depositary Shares with instructions to the Depositary to
deliver to the holder the Stock and all money and other property, if any,
represented thereby, except in order to comply with mandatory provisions of
applicable law.
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SECTION 6.02. Termination. This Depositary Agreement shall
automatically terminate if (i) all outstanding Depositary Shares have been
redeemed, (ii) each share of Stock has been converted into or exchanged for
other securities of the Company or (ii) there has been a final distribution in
respect of the series of Stock underlying such Depositary Shares in connection
with any liquidation, dissolution or winding up of the Company and such
distribution has been distributed to the holders of Depositary Shares. Whenever
so directed by the Company, the Depositary will terminate this Deposit Agreement
by mailing notice of such termination to the record holders of all Receipts then
outstanding at least 30 days prior to the date fixed in such notice for such
termination. The Depositary may likewise terminate this Deposit Agreement if at
any time 60 days shall have expired after the Depositary shall have delivered to
the Company a written notice of its election to resign and a successor
depositary shall not have been appointed and accepted its appointment as
provided in Section 5.04.
If any Receipts shall remain outstanding after the date of
termination of this Deposit Agreement, the Depositary thereafter shall
discontinue the transfer of Receipts, shall suspend the distribution of
dividends to the holders thereof and shall not give any further notices (other
than notice of such termination) or perform any further acts under this Deposit
Agreement, except that the Depositary shall continue to collect dividends and
other distributions pertaining to Stock, shall sell rights, preferences or
privileges as provided in this Deposit Agreement and shall continue to deliver
the Stock and any money and other property represented by Receipts upon
surrender thereof by the holders thereof. After the expiration of two years from
the date of termination, the Depositary shall return to the Company any shares
of Stock then held hereunder, together with any money and other property held by
it hereunder. The Depositary shall thereupon be discharged from all obligations
under this Deposit Agreement except to account for such stock, money and other
property. Upon the termination of this Deposit Agreement, the Company shall be
discharged from all obligations under this Deposit Agreement except for its
obligations to the Depositary, any Depositary's Agent and any Registrar under
Sections 5.07 and 5.08. In the event this Deposit Agreement is terminated, the
Company hereby agrees to use its best efforts to list the underlying Stock on
the New York Stock Exchange, Inc. or any other national securities exchange on
which the Common Stock is listed.
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ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Counterparts. This Deposit Agreement may be executed
by the Company and the Depositary in separate counterparts, each of which
counterparts, when so executed and delivered, shall be deemed an original, but
all such counterparts taken together shall constitute one and the same
instrument. Delivery of an executed counterpart of a signature page to this
Deposit Agreement by telecopier shall be effective as delivery of a manually
executed counterpart of this Deposit Agreement. Copies of this Deposit Agreement
shall be filed with the Depositary and Depositary's Agents and shall be open to
inspection during business hours at the Corporate Office and the respective
offices of the Depositary's Agents, if any, by any holder of a Receipt.
SECTION 7.02. Exclusive Benefit of Parties. This Deposit Agreement
is for the exclusive benefit of the parties hereto, and their respective
successors hereunder, and shall not be deemed to give any legal or equitable
right, remedy or claim to any other person whatsoever.
SECTION 7.03. Invalidity of Provisions. In case any one or more of
the provisions contained in this Deposit Agreement or in the Receipts should be
or become invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein or
therein shall in no way be affected, prejudiced or disturbed thereby.
SECTION 7.04. Notices. Any notices to be given to the Company
hereunder or under the Receipts shall be in writing and shall be deemed to have
been duly given if personally delivered or sent by mail, or by telegram or telex
or telecopier confirmed by letter, addressed to the Company at 388 Greenwich
Street, New York, New York 10013, Attention: General Counsel, or at any other
place to which the Company may have transferred its principal executive office.
Any notices to be given to the Depositary hereunder or under the
Receipts shall be in writing and shall be deemed to have been duly given if
personally delivered or sent by mail, or by telegram or telex or telecopier
confirmed by letter, addressed to the Depositary at the Corporate Office.
Any notices given to any record holder of a Receipt hereunder or
under the Receipts shall be in writing and shall be deemed to have been duly
given if personally delivered or sent by mail, or by telegram or telex or
telecopier confirmed by letter, addressed to such record holder at the address
of such record holder as it appears on the books
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of the Depositary or, if such holder shall have timely filed with the Depositary
a written request that notices intended for such holder be mailed to some other
address, at the address designated in such request.
Delivery of a notice sent by mail, or by telegram or telex or
telecopier shall be deemed to be effected at the time when a duly addressed
letter containing the same (or a duly addressed letter confirming an earlier
notice in the case of a telegram or telex or telecopier message) is deposited,
postage prepaid, in a post office letter box. The Depositary or the Company may,
however, act upon any telegram or telex or telecopier message received by it
from the other or from any holder of a Receipt, notwithstanding that such
telegram or telex or telecopier message shall not subsequently be confirmed by
letter as aforesaid.
SECTION 7.05. Depositary's Agents. The Depositary may from time to
time appoint Depositary's Agents to act in any respect for the Depositary for
the purposes of this Deposit Agreement and may at any time appoint additional
Depositary's Agents and vary or terminate the appointment of such Depositary's
Agents. The Depositary will obtain the written consent of the Company prior to
any such action.
SECTION 7.06. Holders of Receipts are Parties. Notwithstanding that
holders of Receipts have not executed and delivered this Deposit Agreement or
any counterpart thereof, the holders of Receipts from time to time shall be
deemed to be parties to this Deposit Agreement and shall be bound by all of the
terms and conditions hereof and of the Receipts by acceptance of delivery of
Receipts.
SECTION 7.07. Governing Law. THIS DEPOSIT AGREEMENT AND THE RECEIPTS
AND ALL RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND THEREOF SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW.
SECTION 7.08. Headings. The headings of articles and sections in
this Deposit Agreement and in the form of the Receipt set forth in Exhibit A
hereto have been inserted for convenience only and are not to be regarded as a
part of this Deposit Agreement or to have any bearing upon the meaning or
interpretation of any provision contained herein or in the Receipts.
24
<PAGE>
IN WITNESS WHEREOF, the Company and the Depositary have duly
executed this agreement as of the day and year first above set forth and all
holders of Receipts shall become parties hereto by and upon acceptance by them
of delivery of Receipts issued in accordance with the terms hereof.
TRAVELERS GROUP INC.
By:
---------------------------
Authorized Officer
Attest:
[DEPOSITARY]
By:
------------------------
By:
---------------------------
Authorized Officer
Attest:
By:
------------------------
25
<PAGE>
EXHIBIT A
FORM OF
DEPOSITARY RECEIPT
FOR
DEPOSITARY SHARES
EACH REPRESENTING [FRACTION] OF A SHARE OF
_________________ PREFERRED STOCK, SERIES __
($1.00 par value)
OF
TRAVELERS GROUP INC.
(Incorporated under the Laws of the State of Delaware)
THIS RECEIPT IS TRANSFERABLE IN NEW YORK
CUSIP [_________________________]
SEE REVERSE FOR CERTAIN DEFINITIONS
No._____________ _______ $__________ Depositary Shares (each Depositary
Share represents [fraction] of a share of __________
Preferred Stock, Series ___, $1.00 par value)
__________________________________________________, a _________
trust company, as Depositary (the "Depositary"), hereby certifies that
________________ is the registered owner of _____ Depositary Shares (the
"Depositary Shares"), each Depositary Share representing [fraction] of a share
of Preferred Stock, Series ___, $1.00 par value (the "Stock"), of Travelers
Group Inc., a corporation duly organized and existing under the laws of the
State of Delaware (the "Company"), on deposit with the Depositary. Subject to
the terms of the Deposit Agreement dated as of __________________ (the "Deposit
Agreement") among the Company, the Depositary and the holders from time to time
of the Depositary Receipts issued thereunder ("Receipts"), each owner of a
Depositary Share is entitled, proportionately, to all the powers, preferences
and rights and the qualifications, limitations and restrictions of such
preferences and/or rights of the Stock represented thereby, including dividends,
voting, conversion, redemption and liquidation rights as set forth in the
Certificate of Incorporation of the Company as amended and supplemented by the
Certificate of Designation (the "Certificate of Designation") fixing the terms
of the Stock
A-1
<PAGE>
filed with the Secretary of State of the State of Delaware. By accepting this
Depositary Receipt, the holder hereof becomes a party to and agrees to be bound
by all of the terms and conditions of the Deposit Agreement. The statements made
on the face and the reverse of this Receipt with respect to the provisions of
the Deposit Agreement are subject to the detailed provisions in the full text
thereof, to which reference is hereby made. In the event of any conflict between
the provisions of this Receipt and the provisions of the Deposit Agreement, the
provisions of the Deposit Agreement will govern.
The Company will furnish without charge to any registered owner of
Depositary Shares who so requests, a copy of the Certificate of Incorporation of
the Company, the Deposit Agreement and the Certificate of Designation.
This Depositary Receipt shall not be valid or obligatory for any
purpose or entitled to any benefits under the Deposit Agreement unless it shall
have been executed by the Depositary by the manual signature of a duly
authorized officer or, if a Registrar for the Receipts (other than the
Depositary) shall have been appointed, if executed in facsimile by the
Depositary, countersigned by such Registrar in respect of the Depositary
Receipts by the manual signature of a duly authorized officer thereof.
Dated:_________________________
[DEPOSITARY]
DEPOSITARY
AND REGISTRAR
By:
----------------------
Authorized Officer
A-2
<PAGE>
[ON REVERSE OF DEPOSITARY RECEIPT]
THE COMPANY WILL FURNISH WITHOUT CHARGE TO ANY REGISTERED RECEIPT
HOLDER WHO SO REQUESTS, A COPY OF THE DEPOSIT AGREEMENT AND A COPY OR SUMMARY OF
THE CERTIFICATE OF THE DESIGNATIONS, POWERS, PREFERENCES AND RELATIVE,
PARTICIPATING, OPTIONAL OR OTHER RIGHTS, AND OF THE QUALIFICATIONS, LIMITATIONS
OR RESTRICTIONS THEREOF, OF THE STOCK OF THE COMPANY. ANY SUCH REQUEST IS TO BE
ADDRESSED TO THE COMPANY AT 388 GREENWICH STREET, NEW YORK, NEW YORK 10013,
ATTENTION: TREASURER.
------------------------------
The following abbreviations, when used in the instructions on the
face of this receipt shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM - as tenants in common UNIF GIFT MIN ACT -
TEN ENT - as tenants by the (Cust) Custodian (Minor)
entireties Under Uniform Gifts to
JT TEN - as joint tenants with Minors Act State
right of survivorship
and not as tenants in
common
Additional abbreviations may also be
used though not in the above list.
A-3
<PAGE>
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _________________ ( ) Depositary Shares represented by the within
Receipt and all rights and interests represented by the Depositary Shares
evidenced thereby, and hereby irrevocably constitutes and appoints
_________________ his attorney, to transfer the same on the books of the
within-named Depositary, with full power of substitution in the premises.
Signature:
---------------------------------
NOTE: The signature to this
assignment must correspond with the
name as written upon the face of the
Receipt in every particular, without
alteration or enlargement, or any
change whatever.
Signature Guarantee:
------------------------------------
A-4
<PAGE>
Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, New York 10022-3897
Tel: (212) 735-3000
Fax: (212) 735-2000
May 14, 1997
Travelers Group Inc.
388 Greenwich Street
New York, NY 10013
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
c/o Travelers Group Inc.
388 Greenwich Street
New York, New York 10013
Re: Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
Registration Statement on Form S-3
----------------------------------
Ladies and Gentlemen:
We have acted as special counsel to (1) Travelers Capital IV,
Travelers Capital V, Travelers Capital VI and Travelers Capital VII (each, a
"Travelers Trust" and, together, the "Travelers Trusts"), each a statutory
business trust formed under the laws of the State of Delaware, and (2)
Travelers Group Inc. (the "Company"), a corporation organized under the laws
of the State of Delaware, in connection with the preparation of a
Registration Statement on Form S-3 (the "Registration Statement"), to be
filed by the Company and the Travelers Trusts with the Securities and
Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 2
(the "Act"). The Registration Statement relates to the issuance and sale
from time to time pursuant to Rule 415 of the General Rules and Regulations
promulgated under the Act, of the following securities with an aggregate
public offering price of up to $1,000,000,000: (i) preferred securities (the
"Trust Preferred Securities") of each of the Travelers Trusts, (ii) unsecured
junior subordinated debt securities (the "Junior Subordinated Debt
Securities") of the Company which are to be issued pursuant to an Indenture,
dated as of October 7, 1996 (the "Indenture"), between the Company and The
Chase Manhattan Bank, as debt trustee (the "Debt Trustee"), (iii) shares of
preferred stock, par value $1.00 per share (the "Preferred Stock"), of the
Company to be issued in one or more series, which may also be issued in the
form of depositary shares (the "Depositary Shares") evidenced by depositary
receipts (the "Receipts") pursuant to one or more deposit agreements (each, a
"Deposit Agreement") proposed to be entered into between the Company and a
depositary to be named (the "Depositary") and (iv) shares of common stock,
par value $.01 per share, of the Company as may be issuable upon conversion
of some or all of the Preferred Stock (the "Offered Common Stock"). The
Trust Preferred Securities, the Junior Subordinated Debt Securities, the
Preferred Stock, the Depositary Shares and the Offered Common Stock are
collectively referred to herein as the "Offered Securities."
The Trust Preferred Securities of each Travelers Trust are to be
issued pursuant to the Amended and Restated Declaration of Trust of such
Travelers Trust (each, a "Declaration" and, collectively, the
"Declarations"), each such Declaration being among the Company, as sponsor
and as the issuer of the Junior Subordinated Debt Securities to be held by
the Property Trustee (as defined below) of such Travelers Trust, Chase
Manhattan Bank Delaware, as Delaware trustee (the "Delaware Trustee"), The
Chase Manhattan Bank, as property trustee (the "Property Trustee"), and Heidi
G. Miller and Irwin R.
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 3
Ettinger, as regular trustees (together, the "Regular Trustees").
This opinion is being delivered in accordance with the requirements
of Item 601(b)(5) of Regulation S-K under the Act. Capitalized terms used
but not otherwise defined herein have the meanings ascribed to them in the
Registration Statement.
In connection with this opinion, we have examined originals or
copies, certified or otherwise identified to our satisfaction, of (i) the
form of the Registration Statement relating to the Offered Securities; (ii)
the certificates of trust of Travelers Capital IV and Travelers Capital V
filed with the Secretary of State of the State of Delaware on September 19,
1996 and the certificates of trust of Travelers Capital VI and Travelers
Capital VII filed with the Secretary of State of the State of Delaware on May
14, 1997 (collectively, the "Certificates of Trust"); (iii) the form of the
Declaration of each of the Travelers Trusts (including the designations of
the terms of the Trust Preferred Securities of such Travelers Trust annexed
thereto); (iv) the form of the Trust Preferred Securities of each of the
Travelers Trusts; (v) the form of the preferred securities guarantee
agreement (the "Preferred Securities Guarantee"), between the Company and The
Chase Manhattan Bank, as guarantee trustee (the "Preferred Securities
Guarantee Trustee"); (vi) the form of the Junior Subordinated Debt
Securities; (vii) an executed copy of the Indenture; (viii) the Restated
Certificate of Incorporation of the Company, as amended to date (the
"Certificate of Incorporation"); (ix) the Restated By-Laws of the Company, as
currently in effect (the "By-Laws"); and (x) a specimen certificate
evidencing the common stock, par value $.01 per share, of the Company (the
"Common Stock"). We have also examined originals or copies, certified or
otherwise identified to our satisfaction, of such other documents,
certificates and records as we have
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 4
deemed necessary or appropriate as a basis for the opinions set forth herein.
In our examination, we have assumed the legal capacity of all
natural persons, the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, the conformity to original documents
of all documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such copies. In making our examination of
documents executed or to be executed by parties other than the Company and
the Travelers Trusts, we have assumed that such parties had or will have the
power, corporate or other, to enter into and perform all obligations
thereunder and have also assumed the due authorization by all requisite
action, corporate or other, and execution and delivery by such parties of
such documents and that such documents constitute valid and binding
obligations of such parties. In addition, we have assumed that the
Declaration of each Travelers Trust, the Preferred Securities of each
Travelers Trust, the Preferred Securities Guarantee and the Junior
Subordinated Debt Securities will be executed in substantially the form
reviewed by us and that the terms of the Offered Trust Preferred Securities,
the Offered Debt Securities, the Offered Preferred Stock and the Depositary
Shares will have been established so as not to violate any applicable law,
the Certificate of Incorporation or By-Laws of the Company or result in a
default under or breach of any agreement or instrument binding upon the
Company or the Travelers Trusts and so as to comply with any requirement or
restriction imposed by any court or governmental body having jurisdiction
over the Company or the Travelers Trusts. We have also assumed that (i) the
liquidation preference of a share of the Preferred Stock will exceed the par
value thereof, (ii) the stock certificates evidencing the Preferred Stock to
be issued will be in a form that complies with, and the terms of such
Preferred Stock will be duly established in accordance with, the Delaware
General Corporation Law (the "DGCL"), and (iii)
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 5
the stock certificate evidencing any Offered Common Stock issued will conform
to the specimen certificate examined by us and will be manually signed by an
authorized officer of the transfer agent and registrar for the Common Stock
and registered by such transfer agent and registrar. As to any facts
material to the opinions expressed herein which were not independently
established or verified, we have relied upon oral or written statements and
representations of officers, trustees and other representatives of the
Company, the Travelers Trusts and others.
Members of our firm are admitted to the bar in the States of
Delaware and New York, and we express no opinion as to the laws of any other
jurisdiction other than the laws of the United States of America to the
extent specifically referred to herein.
Based on and subject to the foregoing and to the other
qualifications and limitations set forth herein, we are of the opinion that:
1. With respect to the Trust Preferred Securities of each
Travelers Trust (the "Offered Trust Preferred Securities"), when (i) the
Registration Statement, as finally amended (including all necessary
post-effective amendments), has become effective under the Act; (ii) an
appropriate prospectus supplement with respect to the Offered Trust Preferred
Securities has been prepared, delivered and filed in compliance with the Act
and the applicable rules and regulations thereunder; (iii) the Declaration of
such Travelers Trust is duly executed and delivered by the parties thereto;
(iv) the terms of the Offered Trust Preferred Securities have been
established in accordance with the Declaration; (v) the Offered Trust
Preferred Securities have been issued and executed in accordance with the
Declaration and paid for in the manner contemplated in the Registration
Statement or any prospectus supplement relating thereto; and (vi) if the
Offered Trust Preferred Securities are to be sold pursuant to a firm
commitment underwritten offering, the
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 6
underwriting agreement with respect to the Offered Trust Preferred Securities
has been duly authorized, executed and delivered by the applicable Travelers
Trust and the other parties thereto, (1) the Offered Trust Preferred
Securities will be duly authorized for issuance and will be validly issued,
fully paid and nonassessable, representing undivided beneficial interests in
the assets of such Travelers Trust and (2) the holders of the Offered Trust
Preferred Securities will be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit
organized under the DGCL. We bring to your attention, however, that the
holders of the Offered Trust Preferred Securities may be obligated, pursuant
to the Declaration of such Travelers Trust, to (i) provide indemnity and/or
security in connection with, and pay taxes or governmental charges arising
from, transfers of Offered Trust Preferred Securities and (ii) provide
security and indemnity in connection with the requests of or directions to
the Property Trustee of such Travelers Trust to exercise its rights and
powers under the Declaration of such Travelers Trust.
2. The Preferred Securities Guarantee, when duly executed and
delivered by the parties thereto, will be a valid and binding agreement of
the Company, enforceable against the Company in accordance with its terms,
except to the extent that enforcement thereof may be limited by (i)
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium, or
other similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity).
3. With respect to any series of Junior Subordinated Debt
Securities (the "Offered Debt Securities"), when (i) the Registration
Statement, as finally amended (including all necessary post-effective
amendments), has become effective under the Act; (ii) an appropriate
prospectus supplement with respect to the
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 7
Offered Debt Securities has been prepared, delivered and filed in compliance
with the Act and the applicable rules and regulations thereunder; (iii) the
Board of Directors, including any appropriate committee appointed thereby,
and appropriate officers of the Company have taken all necessary corporate
action to approve the issuance and terms of the Offered Debt Securities and
related matters; (iv) the terms of the Offered Debt Securities have been
established in conformity with the Indenture and (v) the Offered Debt
Securities are duly executed, delivered, authenticated and issued in
accordance with the Indenture and delivered and paid for in the manner
contemplated in the Registration Statement or any prospectus supplement
relating thereto, the Offered Debt Securities will be valid and binding
obligations of the Company, entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms, except to the
extent that enforcement thereof may be limited by (i) bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium, or other similar laws now
or hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity (regardless of whether enforceability is
considered in a proceeding at law or in equity).
4. With respect to the shares of any series of Preferred Stock
(the "Offered Preferred Stock"), when (i) the Registration Statement, as
finally amended (including all necessary post-effective amendments), has
become effective under the Act; (ii) an appropriate prospectus supplement
with respect to the shares of the Offered Preferred Stock has been prepared,
delivered and filed in compliance with the Act and the applicable rules and
regulations thereunder; (iii) the Board of Directors, including any
appropriate committee appointed thereby, and appropriate officers of the
Company have taken all necessary corporate action to approve the issuance and
terms of the shares of the Offered Preferred Stock and related matters,
including the adoption of a Certificate of Designation for the Offered
Preferred Stock; (iv) the
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 8
filing of the Certificate of Designation with the Secretary of State of the
State of Delaware has duly occurred; (v) the terms of the Offered Preferred
Stock and of their issuance and sale have been duly established by all
necessary corporate action in conformity with the Company's Certificate of
Incorporation including the Certificate of Designation relating to the
Offered Preferred Stock and the By-Laws of the Company; (vi) if the Offered
Preferred Stock is to be sold pursuant to a firm commitment underwritten
offering, the underwriting agreement with respect to the shares of the
Offered Preferred Stock has been duly authorized, executed and delivered by
the Company and the other parties thereto; and (vii) certificates
representing the shares of the Offered Preferred Stock are duly executed,
countersigned, registered and delivered by the proper officers of the Company
to the purchasers thereof against payment of the agreed-upon consideration
therefor in the manner contemplated in the Registration Statement or any
prospectus supplement or term sheet relating thereto, (1) the shares of the
Offered Preferred Stock, when issued and sold in accordance with the
applicable underwriting agreement or any other duly authorized, executed and
delivered applicable purchase agreement, will be duly authorized, validly
issued, fully paid and nonassessable, provided that the consideration
therefor is not less than the par value thereof; and (2) if the Offered
Preferred Stock is convertible into Offered Common Stock, the Offered Common
Stock issuable upon conversion of the Offered Preferred Stock will be duly
authorized, validly issued, fully paid and nonassessable, assuming the
execution, authentication, issuance and delivery of the Offered Preferred
Stock and the conversion of the Offered Preferred Stock in accordance with
the terms of the Certificate of Designation. In rendering the opinion set
forth in clause (2) of this paragraph 4, we have assumed that, at the time of
issuance of any Offered Common Stock upon conversion of the Offered Preferred
Stock, the Certificate of Incorporation, the By-Laws and the DGCL shall not
have been amended so as to affect the validity of such issuance.
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 9
5. With respect to Depositary Shares representing fractional
interests in any Offered Preferred Stock, when (i) the Registration
Statement, as finally amended (including all necessary post-effective
amendments), has become effective under the Act; (ii) an appropriate
prospectus supplement with respect to the Depositary Shares has been
prepared, delivered and filed in compliance with the Act and the applicable
rules and regulations thereunder; (iii) the Board of Directors, including any
appropriate committee appointed thereby, and appropriate officers of the
Company have taken all necessary corporate action to approve the issuance and
terms of the Depositary Shares and related matters, including the adoption of
the Certificate of Designation for the related Offered Preferred Stock; (iv)
the filing of the Certificate of Designation with the Secretary of State of
the State of Delaware has duly occurred; (v) the Deposit Agreement has been
duly executed and delivered; (vi) the terms of the Depositary Shares and of
their issuance and sale have been duly established by all necessary corporate
action in conformity with the Deposit Agreement; (vii) the related Offered
Preferred Stock that is represented by Depositary Shares has been duly
authorized, validly issued and delivered to the Depositary for deposit in
accordance with the laws of the States of Delaware and New York; (viii) if
the Depositary Shares are to be sold pursuant to a firm commitment
underwritten offering, the underwriting agreement with respect to the
Depositary Shares has been duly authorized, executed and delivered by the
Company and the other parties thereto; and (ix) the Receipts evidencing the
Depositary Shares are duly issued against the deposit of the Offered
Preferred Stock in accordance with the Deposit Agreement, such Receipts will
be validly issued and will entitle the holders thereof to the rights
specified therein and in the Deposit Agreement.
6. There is no provision in the Certificate of Incorporation which
purports to restrict the surplus of the Company by reason of the excess, if
any, of the
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 10
liquidation preference of the shares of Preferred Stock over their par value.
The applicable provisions of the DGCL, 8 Del. C. Sections 154 and 170(a),
which define capital and surplus of a Delaware corporation available for the
payment of dividends, do not purport to restrict such surplus by reason of
any such excess. Moreover, we are not aware of any applicable provisions of
the Constitution of the State of Delaware nor any controlling Delaware case
law which would suggest that surplus would be restricted by the excess of the
liquidation preference over the par value of the shares of Preferred Stock.
Accordingly, while there are no authorities specifically addressing this
issue, it is our opinion that (i) there should be no restriction upon the
surplus of the Company available for the payment of dividends on any
outstanding capital stock of the Company solely by reason of the fact that
the liquidation preference of any shares of any series of Preferred Stock
exceeds the par value of such shares and (ii) no remedy should be available
to the holders of shares of any series of Preferred Stock before or after
payment of any dividend solely because such dividend would reduce the surplus
of the Company to an amount less than the amount of such excess, assuming
that the payment of such dividend is in accordance with the provisions of the
DGCL, and of the Certificate of Incorporation including the applicable
Certificate of Designation.
We hereby consent to the filing of this opinion with the Commission
as an exhibit to the Registration Statement. We also hereby consent to the
use of our name under the heading "Legal Matters" in the prospectus which
forms a part of the Registration Statement. In giving this consent, we do
not thereby admit that we are within the category of persons whose consent is
required under Section 7 of the Act or the rules and regulations of the
Commission promulgated thereunder. This opinion is expressed as of the date
hereof unless otherwise expressly stated and we disclaim any undertaking to
advise you
<PAGE>
Travelers Group Inc.
Travelers Capital IV
Travelers Capital V
Travelers Capital VI
Travelers Capital VII
May 14, 1997
Page 11
of the facts stated or assumed herein or any subsequent changes in applicable
law.
Very truly yours,
/s/ Skadden, Arps, Slate, Meagher & Flom LLP
<PAGE>
<TABLE>
<CAPTION>
RATIO OF EARNINGS TO COMBINED
FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
TRAVELERS GROUP INC. AND SUBSIDIARIES
(IN MILLIONS OF DOLLARS, EXCEPT FOR RATIO)
THREE
MONTHS
ENDED YEAR ENDED DECEMBER 31,
MARCH 31, -----------------------
---------
1997 1996 1995 1994 1993 1992
-------- -------- -------- -------- --------- ---------
<S> <C> <C> <C>
Pre tax income from continuing operations $1,068 $3,398 $2,521 $1,874 $1,523 $1,188
Undistributed earnings of equity investee
Pre tax minority interest
Fixed charges:
Interest 653 2,259 1,956 1,284 707 674
Interest portion of rentals 27 107 104 134 61 38
-------- -------- -------- -------- --------- ---------
Total fixed charges 680 2,366 2,060 1,418 768 712
-------- -------- -------- -------- --------- ---------
Earnings available for fixed charges $1,748 $5,764 $4,581 $3,292 $2,143 $1,874
-------- -------- -------- -------- --------- ---------
Total preferred dividend requirement $21.0 $93.2 $84.0 $82.9 $27.2 $10.3
Effective tax rate 35.3% 30.9% 35.4% 38.3% 36.1% 36.4%
Total preferred dividend grossed up $32.4 $134.9 $130.1 $134.3 $42.6 $16.2
Total fixed charges and preferred dividends $712.9 $2,500.9 $2,190.1 $1,552.3 $810.6 $728.2
-------- -------- -------- -------- --------- ---------
Ratio of earnings to combined fixed charges and
preferred stock dividends 2.45x 2.30x 2.09x 2.12x 2.64x 2.57x
-------- -------- -------- -------- --------- ---------
-------- -------- -------- -------- --------- ---------
</TABLE>
<PAGE>
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Travelers Group Inc.:
We consent to the incorporation by reference in the registration statement on
Form S-3 of Travelers Group Inc. of our reports dated January 17, 1997 which
are incorporated by reference or included in the 1996 Annual Report on Form
10-K of Travelers Group Inc. incorporated herein by reference, and to the
reference to our firm under the heading "Experts" in the registration
statement.
/s/ KPMG Peat Marwick LLP
New York, New York
May 14, 1997
<PAGE>
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Aetna Services, Inc. (formerly "Aetna Life and Casualty Company"):
We consent to the incorporation by reference in the registration statement on
Form S-3 filed by Travelers Group Inc. of our report dated February 28, 1996
on the combined financial statements of The Aetna Casualty and Surety Company
and The Standard Fire Insurance Company and their subsidiaries which is
included in the Current Report on Form 8-K/A-1 of Travelers Group Inc. dated
April 2, 1996 incorporated herein by reference, and to the reference to our
firm under the heading "Experts" in the registration statement.
/s/ KPMG Peat Marwick LLP
Hartford, Connecticut
May 14, 1997
<PAGE>
POWER OF ATTORNEY
(Form S-3)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Travelers Group Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Sanford I. Weill, James Dimon and Charles O. Prince,
III, and each of them, the true and lawful attorneys-in-fact and agents of
the undersigned, to do or cause to be done any and all acts and things and to
execute any and all instruments and documents which said attorneys-in-fact
and agents, or any of them, may deem advisable or necessary to enable the
Company to comply with the Securities Act of 1933, as amended (the
"Securities Act"), and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, in connection with the
registration under the Securities Act of preferred stock, common stock,
junior subordinated debt securities, guarantees of trust preferred securities
and certain back-up obligations, in each case of the Company, and the trust
preferred securities of certain related trusts (collectively, the
"Securities"), including specifically, but without limiting the generality of
the foregoing, power and authority to sign, in the name and on behalf of the
undersigned as a director of the Company, a Registration Statement on Form
S-3, a registration statement under Rule 462(b) of the Securities Act, or
another appropriate form in respect of the registration of the Securities and
any and all amendments thereto, including post-effective amendments, and any
instruments, contracts, documents or other writings of which the originals or
copies thereof are to be filed as a part of, or in connection with, any such
Registration Statement or amendments, and to file or cause to be filed the
same with the Securities and Exchange Commission, and to effect any and all
applications and other instruments in the name and on behalf of the
undersigned which said attorneys-in-fact and agents, or any of them, deem
advisable in order to qualify or register the Securities under the securities
laws of any of the several States; and the undersigned does hereby ratify all
that said attorneys-in-fact or agents, or any of them, shall do or cause to
be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has signed these presents this 14th
day of May, 1997.
/s/ C. Michael Armstrong
-------------------------------
(Signature)
<PAGE>
POWER OF ATTORNEY
(Form S-3)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Travelers Group Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Sanford I. Weill, James Dimon and Charles O. Prince,
III, and each of them, the true and lawful attorneys-in-fact and agents of
the undersigned, to do or cause to be done any and all acts and things and to
execute any and all instruments and documents which said attorneys-in-fact
and agents, or any of them, may deem advisable or necessary to enable the
Company to comply with the Securities Act of 1933, as amended (the
"Securities Act"), and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, in connection with the
registration under the Securities Act of preferred stock, common stock,
junior subordinated debt securities, guarantees of trust preferred securities
and certain back-up obligations, in each case of the Company, and the trust
preferred securities of certain related trusts (collectively, the
"Securities"), including specifically, but without limiting the generality of
the foregoing, power and authority to sign, in the name and on behalf of the
undersigned as a director of the Company, a Registration Statement on Form
S-3, a registration statement under Rule 462(b) of the Securities Act, or
another appropriate form in respect of the registration of the Securities and
any and all amendments thereto, including post-effective amendments, and any
instruments, contracts, documents or other writings of which the originals or
copies thereof are to be filed as a part of, or in connection with, any such
Registration Statement or amendments, and to file or cause to be filed the
same with the Securities and Exchange Commission, and to effect any and all
applications and other instruments in the name and on behalf of the
undersigned which said attorneys-in-fact and agents, or any of them, deem
advisable in order to qualify or register the Securities under the securities
laws of any of the several States; and the undersigned does hereby ratify all
that said attorneys-in-fact or agents, or any of them, shall do or cause to
be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has signed these presents this 14th
day of May, 1997.
/s/ Kenneth J. Bialkin
-------------------------------
(Signature)
<PAGE>
POWER OF ATTORNEY
(Form S-3)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Travelers Group Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Sanford I. Weill, James Dimon and Charles O. Prince,
III, and each of them, the true and lawful attorneys-in-fact and agents of
the undersigned, to do or cause to be done any and all acts and things and to
execute any and all instruments and documents which said attorneys-in-fact
and agents, or any of them, may deem advisable or necessary to enable the
Company to comply with the Securities Act of 1933, as amended (the
"Securities Act"), and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, in connection with the
registration under the Securities Act of preferred stock, common stock,
junior subordinated debt securities, guarantees of trust preferred securities
and certain back-up obligations, in each case of the Company, and the trust
preferred securities of certain related trusts (collectively, the
"Securities"), including specifically, but without limiting the generality of
the foregoing, power and authority to sign, in the name and on behalf of the
undersigned as a director of the Company, a Registration Statement on Form
S-3, a registration statement under Rule 462(b) of the Securities Act, or
another appropriate form in respect of the registration of the Securities and
any and all amendments thereto, including post-effective amendments, and any
instruments, contracts, documents or other writings of which the originals or
copies thereof are to be filed as a part of, or in connection with, any such
Registration Statement or amendments, and to file or cause to be filed the
same with the Securities and Exchange Commission, and to effect any and all
applications and other instruments in the name and on behalf of the
undersigned which said attorneys-in-fact and agents, or any of them, deem
advisable in order to qualify or register the Securities under the securities
laws of any of the several States; and the undersigned does hereby ratify all
that said attorneys-in-fact or agents, or any of them, shall do or cause to
be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has signed these presents this 14th
day of May, 1997.
/s/ Joseph A. Califano, Jr.
-------------------------------
(Signature)
<PAGE>
POWER OF ATTORNEY
(Form S-3)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Travelers Group Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Sanford I. Weill, James Dimon and Charles O. Prince,
III, and each of them, the true and lawful attorneys-in-fact and agents of
the undersigned, to do or cause to be done any and all acts and things and to
execute any and all instruments and documents which said attorneys-in-fact
and agents, or any of them, may deem advisable or necessary to enable the
Company to comply with the Securities Act of 1933, as amended (the
"Securities Act"), and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, in connection with the
registration under the Securities Act of preferred stock, common stock,
junior subordinated debt securities, guarantees of trust preferred securities
and certain back-up obligations, in each case of the Company, and the trust
preferred securities of certain related trusts (collectively, the
"Securities"), including specifically, but without limiting the generality of
the foregoing, power and authority to sign, in the name and on behalf of the
undersigned as a director of the Company, a Registration Statement on Form
S-3, a registration statement under Rule 462(b) of the Securities Act, or
another appropriate form in respect of the registration of the Securities and
any and all amendments thereto, including post-effective amendments, and any
instruments, contracts, documents or other writings of which the originals or
copies thereof are to be filed as a part of, or in connection with, any such
Registration Statement or amendments, and to file or cause to be filed the
same with the Securities and Exchange Commission, and to effect any and all
applications and other instruments in the name and on behalf of the
undersigned which said attorneys-in-fact and agents, or any of them, deem
advisable in order to qualify or register the Securities under the securities
laws of any of the several States; and the undersigned does hereby ratify all
that said attorneys-in-fact or agents, or any of them, shall do or cause to
be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has signed these presents this 14th
day of May, 1997.
/s/ Dudley C. Mecum
-------------------------------
(Signature)
<PAGE>
POWER OF ATTORNEY
(Form S-3)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Travelers Group Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Sanford I. Weill, James Dimon and Charles O. Prince,
III, and each of them, the true and lawful attorneys-in-fact and agents of
the undersigned, to do or cause to be done any and all acts and things and to
execute any and all instruments and documents which said attorneys-in-fact
and agents, or any of them, may deem advisable or necessary to enable the
Company to comply with the Securities Act of 1933, as amended (the
"Securities Act"), and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, in connection with the
registration under the Securities Act of preferred stock, common stock,
junior subordinated debt securities, guarantees of trust preferred securities
and certain back-up obligations, in each case of the Company, and the trust
preferred securities of certain related trusts (collectively, the
"Securities"), including specifically, but without limiting the generality of
the foregoing, power and authority to sign, in the name and on behalf of the
undersigned as a director of the Company, a Registration Statement on Form
S-3, a registration statement under Rule 462(b) of the Securities Act, or
another appropriate form in respect of the registration of the Securities and
any and all amendments thereto, including post-effective amendments, and any
instruments, contracts, documents or other writings of which the originals or
copies thereof are to be filed as a part of, or in connection with, any such
Registration Statement or amendments, and to file or cause to be filed the
same with the Securities and Exchange Commission, and to effect any and all
applications and other instruments in the name and on behalf of the
undersigned which said attorneys-in-fact and agents, or any of them, deem
advisable in order to qualify or register the Securities under the securities
laws of any of the several States; and the undersigned does hereby ratify all
that said attorneys-in-fact or agents, or any of them, shall do or cause to
be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has signed these presents this 14th
day of May, 1997.
/s/ Linda J. Wachner
-------------------------------
(Signature)
<PAGE>
POWER OF ATTORNEY
(Form S-3)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Travelers Group Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Sanford I. Weill, James Dimon and Charles O. Prince,
III, and each of them, the true and lawful attorneys-in-fact and agents of
the undersigned, to do or cause to be done any and all acts and things and to
execute any and all instruments and documents which said attorneys-in-fact
and agents, or any of them, may deem advisable or necessary to enable the
Company to comply with the Securities Act of 1933, as amended (the
"Securities Act"), and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, in connection with the
registration under the Securities Act of preferred stock, common stock,
junior subordinated debt securities, guarantees of trust preferred securities
and certain back-up obligations, in each case of the Company, and the trust
preferred securities of certain related trusts (collectively, the
"Securities"), including specifically, but without limiting the generality of
the foregoing, power and authority to sign, in the name and on behalf of the
undersigned as a director of the Company, a Registration Statement on Form
S-3, a registration statement under Rule 462(b) of the Securities Act, or
another appropriate form in respect of the registration of the Securities and
any and all amendments thereto, including post-effective amendments, and any
instruments, contracts, documents or other writings of which the originals or
copies thereof are to be filed as a part of, or in connection with, any such
Registration Statement or amendments, and to file or cause to be filed the
same with the Securities and Exchange Commission, and to effect any and all
applications and other instruments in the name and on behalf of the
undersigned which said attorneys-in-fact and agents, or any of them, deem
advisable in order to qualify or register the Securities under the securities
laws of any of the several States; and the undersigned does hereby ratify all
that said attorneys-in-fact or agents, or any of them, shall do or cause to
be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has signed these presents this 14th
day of May, 1997.
/s/ Joseph R. Wright, Jr.
-------------------------------
(Signature)
<PAGE>
POWER OF ATTORNEY
(Form S-3)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Travelers Group Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Sanford I. Weill, James Dimon and Charles O. Prince,
III, and each of them, the true and lawful attorneys-in-fact and agents of
the undersigned, to do or cause to be done any and all acts and things and to
execute any and all instruments and documents which said attorneys-in-fact
and agents, or any of them, may deem advisable or necessary to enable the
Company to comply with the Securities Act of 1933, as amended (the
"Securities Act"), and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, in connection with the
registration under the Securities Act of preferred stock, common stock,
junior subordinated debt securities, guarantees of trust preferred securities
and certain back-up obligations, in each case of the Company, and the trust
preferred securities of certain related trusts (collectively, the
"Securities"), including specifically, but without limiting the generality of
the foregoing, power and authority to sign, in the name and on behalf of the
undersigned as a director of the Company, a Registration Statement on Form
S-3, a registration statement under Rule 462(b) of the Securities Act, or
another appropriate form in respect of the registration of the Securities and
any and all amendments thereto, including post-effective amendments, and any
instruments, contracts, documents or other writings of which the originals or
copies thereof are to be filed as a part of, or in connection with, any such
Registration Statement or amendments, and to file or cause to be filed the
same with the Securities and Exchange Commission, and to effect any and all
applications and other instruments in the name and on behalf of the
undersigned which said attorneys-in-fact and agents, or any of them, deem
advisable in order to qualify or register the Securities under the securities
laws of any of the several States; and the undersigned does hereby ratify all
that said attorneys-in-fact or agents, or any of them, shall do or cause to
be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has signed these presents this 14th
day of May, 1997.
/s/ Arthur Zankel
-------------------------------
(Signature)
<PAGE>
POWER OF ATTORNEY
(Form S-3)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Travelers Group Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Sanford I. Weill, James Dimon and Charles O. Prince,
III, and each of them, the true and lawful attorneys-in-fact and agents of
the undersigned, to do or cause to be done any and all acts and things and to
execute any and all instruments and documents which said attorneys-in-fact
and agents, or any of them, may deem advisable or necessary to enable the
Company to comply with the Securities Act of 1933, as amended (the
"Securities Act"), and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, in connection with the
registration under the Securities Act of preferred stock, common stock,
junior subordinated debt securities, guarantees of trust preferred securities
and certain back-up obligations, in each case of the Company, and the trust
preferred securities of certain related trusts (collectively, the
"Securities"), including specifically, but without limiting the generality of
the foregoing, power and authority to sign, in the name and on behalf of the
undersigned as a director of the Company, a Registration Statement on Form
S-3, a registration statement under Rule 462(b) of the Securities Act, or
another appropriate form in respect of the registration of the Securities and
any and all amendments thereto, including post-effective amendments, and any
instruments, contracts, documents or other writings of which the originals or
copies thereof are to be filed as a part of, or in connection with, any such
Registration Statement or amendments, and to file or cause to be filed the
same with the Securities and Exchange Commission, and to effect any and all
applications and other instruments in the name and on behalf of the
undersigned which said attorneys-in-fact and agents, or any of them, deem
advisable in order to qualify or register the Securities under the securities
laws of any of the several States; and the undersigned does hereby ratify all
that said attorneys-in-fact or agents, or any of them, shall do or cause to
be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has signed these presents this 14th
day of May, 1997.
/s/ Robert I. Lipp
-------------------------------
(Signature)
<PAGE>
POWER OF ATTORNEY
(Form S-3)
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
Travelers Group Inc., a Delaware corporation (the "Company"), does hereby
constitute and appoint Sanford I. Weill, James Dimon and Charles O. Prince,
III, and each of them, the true and lawful attorneys-in-fact and agents of
the undersigned, to do or cause to be done any and all acts and things and to
execute any and all instruments and documents which said attorneys-in-fact
and agents, or any of them, may deem advisable or necessary to enable the
Company to comply with the Securities Act of 1933, as amended (the
"Securities Act"), and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, in connection with the
registration under the Securities Act of preferred stock, common stock,
junior subordinated debt securities, guarantees of trust preferred securities
and certain back-up obligations, in each case of the Company, and the trust
preferred securities of certain related trusts (collectively, the
"Securities"), including specifically, but without limiting the generality of
the foregoing, power and authority to sign, in the name and on behalf of the
undersigned as a director of the Company, a Registration Statement on Form
S-3, a registration statement under Rule 462(b) of the Securities Act, or
another appropriate form in respect of the registration of the Securities and
any and all amendments thereto, including post-effective amendments, and any
instruments, contracts, documents or other writings of which the originals or
copies thereof are to be filed as a part of, or in connection with, any such
Registration Statement or amendments, and to file or cause to be filed the
same with the Securities and Exchange Commission, and to effect any and all
applications and other instruments in the name and on behalf of the
undersigned which said attorneys-in-fact and agents, or any of them, deem
advisable in order to qualify or register the Securities under the securities
laws of any of the several States; and the undersigned does hereby ratify all
that said attorneys-in-fact or agents, or any of them, shall do or cause to
be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has signed these presents this 14th
day of May, 1997.
/s/ Thomas W. Jones
-------------------------------
(Signature)
<PAGE>
Exhibit 25.4
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
---------------------------------------------
TRAVELERS CAPITAL VI
(Exact name of obligor as specified in its charter)
Delaware (I.R.S. employer
(State or other jurisdiction of identification No.)
incorporation or organization) 06-6446485
388 Greenwich Street
New York, New York 10013
(Address of principal executive offices) (Zip Code)
---------------------------------------------
Trust Preferred Securities
(Title of the indenture securities)
---------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form
T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 13th day of May, 1997.
THE CHASE MANHATTAN BANK
By /s/ Ronald J. Halleran
-----------------------------
Ronald J. Halleran
Second Vice President
-2-
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1996, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ............................................ $ 11,509
Interest-bearing balances .................................... 8,457
Securities: .....................................................
Held to maturity securities....................................... 3,128
Available for sale securities..................................... 40,534
Federal Funds sold and securities purchased under
agreements to resell in domestic offices of the
bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds sold ........................................... 9,222
Securities purchased under agreements to resell .............. 422
Loans and lease financing receivables:
Loans and leases, net of unearned income $133,935
Less: Allowance for loan and lease losses 2,789
Less: Allocated transfer risk reserve .... 16
--------
Loans and leases, net of unearned income,
allowance, and reserve ....................................... 131,130
Trading Assets ................................................... 49,876
Premises and fixed assets (including capitalized
leases)....................................................... 2,877
Other real estate owned .......................................... 290
Investments in unconsolidated subsidiaries and
associated companies.......................................... 124
Customer's liability to this bank on acceptances
outstanding .................................................. 2,313
Intangible assets ................................................ 1,316
Other assets ..................................................... 11,231
--------
TOTAL ASSETS ..................................................... $272,429
========
-3-
<PAGE>
LIABILITIES
Deposits
In domestic offices .......................................... $ 87,006
Noninterest-bearing ..............................$35,783
Interest-bearing ................................. 51,223
-------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's .................................................... 73,206
Noninterest-bearing ...............................$ 4,347
Interest-bearing ................................. 68,859
Federal funds purchased and securities sold under agree-
ments to repurchase in domestic offices of the bank and
of its Edge and Agreement subsidiaries, and in IBF's
Federal funds purchased ...................................... 14,980
Securities sold under agreements to repurchase ............... 10,125
Demand notes issued to the U.S. Treasury ......................... 1,867
Trading liabilities .............................................. 34,783
Other Borrowed money:
With a remaining maturity of one year or less ................ 14,639
With a remaining maturity of more than one year .............. 425
Mortgage indebtedness and obligations under capitalized
leases ....................................................... 40
Bank's liability on acceptances executed and outstanding ......... 2,267
Subordinated notes and debentures ................................ 5,471
Other liabilities ................................................ 11,343
TOTAL LIABILITIES ................................................ 256,152
-------
Limited-Life Preferred stock and related surplus ................. 550
EQUITY CAPITAL
Common stock ..................................................... 1,251
Surplus .......................................................... 10,243
Undivided profits and capital reserves ........................... 4,526
Net unrealized holding gains (Losses)
on available-for-sale securities ................................. (309)
Cumulative foreign currency translation adjustments .............. 16
TOTAL EQUITY CAPITAL ............................................. 15,727
------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL .....................................$272,429
========
I, Joseph L. Sclafani, S.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us, and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
EDWARD D. MILLER )DIRECTORS
THOMAS G. LABRECQUE )
-4-
<PAGE>
Exhibit 25.5
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
---------------------------------------------
TRAVELERS CAPITAL VII
(Exact name of obligor as specified in its charter)
Delaware (I.R.S. employer
(State or other jurisdiction of identification No.)
incorporation or organization) 06-6446486
388 Greenwich Street
New York, New York 10013
(Address of principal executive offices) (Zip Code)
---------------------------------------------
Trust Preferred Securities
(Title of the indenture securities)
---------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form
T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 13th day of May, 1997.
THE CHASE MANHATTAN BANK
By /s/ Ronald J. Halleran
-----------------------------
Ronald J. Halleran
Second Vice President
-2-
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1996, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ............................................ $ 11,509
Interest-bearing balances .................................... 8,457
Securities: .....................................................
Held to maturity securities....................................... 3,128
Available for sale securities..................................... 40,534
Federal Funds sold and securities purchased under
agreements to resell in domestic offices of the
bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds sold ........................................... 9,222
Securities purchased under agreements to resell .............. 422
Loans and lease financing receivables:
Loans and leases, net of unearned income $133,935
Less: Allowance for loan and lease losses 2,789
Less: Allocated transfer risk reserve .... 16
--------
Loans and leases, net of unearned income,
allowance, and reserve ....................................... 131,130
Trading Assets ................................................... 49,876
Premises and fixed assets (including capitalized
leases)....................................................... 2,877
Other real estate owned .......................................... 290
Investments in unconsolidated subsidiaries and
associated companies.......................................... 124
Customer's liability to this bank on acceptances
outstanding .................................................. 2,313
Intangible assets ................................................ 1,316
Other assets ..................................................... 11,231
--------
TOTAL ASSETS ..................................................... $272,429
========
-3-
<PAGE>
LIABILITIES
Deposits
In domestic offices .......................................... $ 87,006
Noninterest-bearing ..............................$35,783
Interest-bearing ................................. 51,223
-------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's .................................................... 73,206
Noninterest-bearing ..............................$ 4,347
Interest-bearing ................................. 68,859
Federal funds purchased and securities sold under agree-
ments to repurchase in domestic offices of the bank and
of its Edge and Agreement subsidiaries, and in IBF's
Federal funds purchased ...................................... 14,980
Securities sold under agreements to repurchase ............... 10,125
Demand notes issued to the U.S. Treasury ......................... 1,867
Trading liabilities .............................................. 34,783
Other Borrowed money:
With a remaining maturity of one year or less ................ 14,639
With a remaining maturity of more than one year .............. 425
Mortgage indebtedness and obligations under capitalized
leases ....................................................... 40
Bank's liability on acceptances executed and outstanding ......... 2,267
Subordinated notes and debentures ................................ 5,471
Other liabilities ................................................ 11,343
TOTAL LIABILITIES ................................................ 256,152
-------
Limited-Life Preferred stock and related surplus ................. 550
EQUITY CAPITAL
Common stock ..................................................... 1,251
Surplus .......................................................... 10,243
Undivided profits and capital reserves ........................... 4,526
Net unrealized holding gains (Losses)
on available-for-sale securities ................................. (309)
Cumulative foreign currency translation adjustments .............. 16
TOTAL EQUITY CAPITAL ............................................. 15,727
------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL .....................................$272,429
========
I, Joseph L. Sclafani, S.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us, and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
EDWARD D. MILLER )DIRECTORS
THOMAS G. LABRECQUE )
-4-
<PAGE>
Exhibit 25.8
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
---------------------------------------------
TRAVELERS CAPITAL VI
(Exact name of obligor as specified in its charter)
Delaware
(I.R.S. employer
(State or other jurisdiction of identification No.)
incorporation or organization) 06-6446485
388 Greenwich Street
New York, New York 10013
(Address of principal executive offices) (Zip Code)
---------------------------------------------
Guarantee of Trust Preferred Securities
(Title of the indenture securities)
---------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form
T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 13th day of May, 1997.
THE CHASE MANHATTAN BANK
By /s/ Ronald J. Halleran
-----------------------------
Ronald J. Halleran
Second Vice President
-2-
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1996, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ............................................ $ 11,509
Interest-bearing balances .................................... 8,457
Securities: .....................................................
Held to maturity securities....................................... 3,128
Available for sale securities..................................... 40,534
Federal Funds sold and securities purchased under
agreements to resell in domestic offices of the
bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds sold ........................................... 9,222
Securities purchased under agreements to resell .............. 422
Loans and lease financing receivables:
Loans and leases, net of unearned income $133,935
Less: Allowance for loan and lease losses 2,789
Less: Allocated transfer risk reserve .... 16
--------
Loans and leases, net of unearned income,
allowance, and reserve ....................................... 131,130
Trading Assets ................................................... 49,876
Premises and fixed assets (including capitalized
leases)....................................................... 2,877
Other real estate owned .......................................... 290
Investments in unconsolidated subsidiaries and
associated companies.......................................... 124
Customer's liability to this bank on acceptances
outstanding .................................................. 2,313
Intangible assets ................................................ 1,316
Other assets ..................................................... 11,231
--------
TOTAL ASSETS ..................................................... $272,429
========
-3-
<PAGE>
LIABILITIES
Deposits
In domestic offices .......................................... $ 87,006
Noninterest-bearing ..............................$35,783
Interest-bearing ................................. 51,223
-------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's .................................................... 73,206
Noninterest-bearing ..............................$ 4,347
Interest-bearing ................................. 68,859
Federal funds purchased and securities sold under agree-
ments to repurchase in domestic offices of the bank and
of its Edge and Agreement subsidiaries, and in IBF's
Federal funds purchased ...................................... 14,980
Securities sold under agreements to repurchase ............... 10,125
Demand notes issued to the U.S. Treasury ......................... 1,867
Trading liabilities .............................................. 34,783
Other Borrowed money:
With a remaining maturity of one year or less ................ 14,639
With a remaining maturity of more than one year .............. 425
Mortgage indebtedness and obligations under capitalized
leases ....................................................... 40
Bank's liability on acceptances executed and outstanding ......... 2,267
Subordinated notes and debentures ................................ 5,471
Other liabilities ................................................ 11,343
TOTAL LIABILITIES ................................................ 256,152
-------
Limited-Life Preferred stock and related surplus ................. 550
EQUITY CAPITAL
Common stock ..................................................... 1,251
Surplus .......................................................... 10,243
Undivided profits and capital reserves ........................... 4,526
Net unrealized holding gains (Losses)
on available-for-sale securities ................................. (309)
Cumulative foreign currency translation adjustments .............. 16
TOTAL EQUITY CAPITAL ............................................. 15,727
------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL .....................................$272,429
========
I, Joseph L. Sclafani, S.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us, and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
EDWARD D. MILLER )DIRECTORS
THOMAS G. LABRECQUE )
-4-
<PAGE>
Exhibit 25.9
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
---------------------------------------------
TRAVELERS CAPITAL VII
(Exact name of obligor as specified in its charter)
Delaware (I.R.S. employer
(State or other jurisdiction of identification No.)
incorporation or organization) 06-6446486
388 Greenwich Street
New York, New York 10013
(Address of principal executive offices) (Zip Code)
---------------------------------------------
Guarantee of Trust Preferred Securities
(Title of the indenture securities)
---------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form
T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 13th day of May, 1997.
THE CHASE MANHATTAN BANK
By /s/ Ronald J. Halleran
-----------------------------
Ronald J. Halleran
Second Vice President
-2-
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1996, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ............................................ $ 11,509
Interest-bearing balances .................................... 8,457
Securities: .....................................................
Held to maturity securities....................................... 3,128
Available for sale securities..................................... 40,534
Federal Funds sold and securities purchased under
agreements to resell in domestic offices of the
bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds sold ........................................... 9,222
Securities purchased under agreements to resell .............. 422
Loans and lease financing receivables:
Loans and leases, net of unearned income $133,935
Less: Allowance for loan and lease losses 2,789
Less: Allocated transfer risk reserve .... 16
--------
Loans and leases, net of unearned income,
allowance, and reserve ....................................... 131,130
Trading Assets ................................................... 49,876
Premises and fixed assets (including capitalized
leases)....................................................... 2,877
Other real estate owned .......................................... 290
Investments in unconsolidated subsidiaries and
associated companies.......................................... 124
Customer's liability to this bank on acceptances
outstanding .................................................. 2,313
Intangible assets ................................................ 1,316
Other assets ..................................................... 11,231
--------
TOTAL ASSETS ..................................................... $272,429
========
-3-
<PAGE>
LIABILITIES
Deposits
In domestic offices .......................................... $ 87,006
Noninterest-bearing ..............................$35,783
Interest-bearing ................................. 51,223
-------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's .................................................... 73,206
Noninterest-bearing ..............................$ 4,347
Interest-bearing ................................. 68,859
Federal funds purchased and securities sold under agree-
ments to repurchase in domestic offices of the bank and
of its Edge and Agreement subsidiaries, and in IBF's
Federal funds purchased ...................................... 14,980
Securities sold under agreements to repurchase ............... 10,125
Demand notes issued to the U.S. Treasury ......................... 1,867
Trading liabilities .............................................. 34,783
Other Borrowed money:
With a remaining maturity of one year or less ................ 14,639
With a remaining maturity of more than one year .............. 425
Mortgage indebtedness and obligations under capitalized
leases ....................................................... 40
Bank's liability on acceptances executed and outstanding ......... 2,267
Subordinated notes and debentures ................................ 5,471
Other liabilities ................................................ 11,343
TOTAL LIABILITIES ................................................ 256,152
-------
Limited-Life Preferred stock and related surplus ................. 550
EQUITY CAPITAL
Common stock ..................................................... 1,251
Surplus .......................................................... 10,243
Undivided profits and capital reserves ........................... 4,526
Net unrealized holding gains (Losses)
on available-for-sale securities ................................. (309)
Cumulative foreign currency translation adjustments .............. 16
TOTAL EQUITY CAPITAL ............................................. 15,727
------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL .....................................$272,429
========
I, Joseph L. Sclafani, S.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us, and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
EDWARD D. MILLER )DIRECTORS
THOMAS G. LABRECQUE )
-4-
