<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): June 3, 1997
RELIASTAR FINANCIAL CORP.
(Exact name of Registrant as specified in its charter)
Delaware 0-17441 41-1620373
(State of Incorporation) (Commission File Number) (IRS Employer
Identification
Number)
20 Washington Avenue South
Minneapolis, Minnesota 55401
(Address of principal executive (Zip Code)
offices)
(612) 372-5432
(Registrant's telephone number, including area code)
RELIASTAR FINANCING II
(Exact name of Registrant as specified in its charter)
Delaware Applied For
(State of incorporation or organization) (IRS Employer Identification
Number)
c/o ReliaStar Financial Corp.
20 Washington Avenue South 55401
Minneapolis, Minnesota (Zip Code)
(Address of principal executive
offices)
(612) 372-5432
(Registrant's telephone number, including area code)
<PAGE>
Item 7. Financial Statements and Exhibits.
---------------------------------
(c) Exhibits
<TABLE>
<CAPTION>
Exhibit
Number
------
<S> <C>
1(c) Underwriting Agreement for Preferred Securities dated May 29, 1997.
4(q) Amended and Restated Declaration of Trust dated as of June 3, 1997,
including form of Preferred Security.
4(r) Second Supplemental Indenture dated as of June 3, 1997 between the
Company and Wilmington Trust Company, as Trustee.
4(s) Preferred Securities Guarantee Agreement dated as of June 3, 1997.
5(a) Opinion of Richards Layton & Finger, counsel to the Trust
8 Opinion of Faegre & Benson LLP.
23(c) Consent of Richards Layton & Finger, P.C. (included in Exhibit 5(a))
25(d) Form T-1 Statement of Eligibility under the Trust Indenture Act of
1939 of Wilmington Trust Company, as Trustee under the Amended and
Restated Declaration.
25(e) Form T-1 Statement of Eligibility under the Trust Indenture Act of
1939 of Wilmington Trust Company, as Trustee under the Preferred
Securities Guarantee Agreement for the benefit of the holders of
Preferred Securities.
</TABLE>
<PAGE>
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrants have duly caused this report to be signed on their behalf by the
undersigned hereunto duly authorized.
RELIASTAR FINANCIAL CORP.
(Registrant)
By/s/ RICHARD R. CROWL
---------------------------------
Richard R. Crowl
Senior Vice President, General
Counsel and Secretary
RELIASTAR FINANCING II
(Registrant)
By /S/ RICHARD R. CROWL
---------------------------------
Richard R. Crowl, Trustee
Date June 3, 1997
<PAGE>
5,000,000 Preferred Securities
RELIASTAR FINANCING II
(a Delaware Trust)
8.10% Trust Originated Preferred Securities (SM)("TOPrS (SM)")
(Liquidation Amount of $25 Per Preferred Security)
UNDERWRITING AGREEMENT
----------------------
May 29, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
DAIN BOSWORTH INCORPORATED
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
THE ROBINSON-HUMPHREY COMPANY, INC.
SMITH BARNEY INC.
as Representatives of the several Underwriters named in Schedule A hereto
c/o MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281
Ladies and Gentlemen:
ReliaStar Financing II (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 Code, 12 Del. C. (S)(S) 3801 et
--
seq.), and ReliaStar Financial Corp., a Delaware corporation (the "Company" and,
- ---
together with the Trust, the "Offerors"), confirm their agreement (the
"Agreement") with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Dain Bosworth Incorporated, Donaldson, Lufkin & Jenrette
Securities Corporation, The Robinson-Humphrey Company, Inc., Smith Barney Inc.
and each of the other Underwriters named in Schedule A hereto (collectively, the
"Underwrit ers", which term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof), for whom such firms are acting as
representatives (in such capacity, such firms shall hereinafter be referred to
as the "Representatives" with respect to the sale by the Trust and the purchase
by the Underwriters, acting severally and not jointly, of the respective numbers
of 8.10% Trust Originated
____________________
/SM/ "Trust Originated Preferred Securities" and "TOPrS" are service marks of
Merrill Lynch & Co., Inc.
<PAGE>
Preferred Securities (liquidation amount of $25 per preferred security) of the
Trust set forth in said Schedule A (the "Preferred Securities") in each case
except as may otherwise be provided in the Pricing Agreement, as hereinafter
defined. The Preferred Securities will be guaranteed by the Company with respect
to distributions and payments upon liquidation, redemption and otherwise (the
"Preferred Securities Guarantee") pursuant to the Preferred Securities Guarantee
Agreement (the "Preferred Securities Guarantee Agreement"), to be dated as of
June 3, 1997, between the Company and Wilmington Trust Company, as trustee (the
"Guarantee Trustee"), and entitled to the benefits of certain backup
undertakings described in the Prospectus (as defined herein) with respect to the
Company's agreement pursuant to the Supplemental Indenture (as defined herein)
to pay all expenses relating to administration of the Trust (the
"Undertakings").
Prior to the purchase and public offering of the Preferred Securities
by the several Underwriters, the Offerors and the Representatives, acting on
behalf of the several Underwriters, shall enter into an agreement substantially
in the form of Exhibit A hereto (the "Pricing Agreement"). The Pricing Agreement
may take the form of an exchange of any standard form of written
telecommunication between the Offerors and the Representatives and shall specify
such applicable information as is indicated in Exhibit A hereto. The offering
of the Preferred Securities will be governed by this Agreement, as supplemented
by the Pricing Agreement. From and after the date of the execution and delivery
of the Pricing Agreement, this Agreement shall be deemed to incorporate the
Pricing Agreement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") in accordance with the provisions of the Securities Act of 1933,
as amended (the "1933 Act"), a registration statement on Form S-3 (File No. 33-
87588) under the 1933 Act for the offering from time to time of its debt
securities, preferred stock, depositary shares, securities warrants and/or
common stock, including rights to purchase preferred stock (the "1994
Securities"), having an aggregate offering price of up to $250,000,000 and such
registration statement has become effective. Such registration statement
(including all documents incorporated or deemed to be incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933 Act) as amended pursuant
to the 1933 Act, the 1934 Act or otherwise is hereinafter referred to as the
"1994 Registration Statement." While an aggregate offering price of $140,000,000
of the 1994 Securities remained unsold, the Offerors filed with the commission
on Form S-3 (No. 33-80497) under the 1933 Act for the offering from time to time
of its securities (the "1996 Securities"), having an aggregate offering price of
up to $250,000,000 (which includes the $140,000,000 of unsold 1994 Securities).
Such registration statement (including all documents incorporated or deemed to
be incorporated by reference therein pursuant to Item 12 of Form S-3 under the
1933 Act) as amended pursuant to the 1933 Act, 1934 Act or otherwise is
hereinafter referred to as the "1995 Registration Statement." On March 29, 1996,
the Company and ReliaStar Financing I, a Delaware business trust, sold
securities pursuant to the 1995 Registration Statement to certain underwriters
in a public offering having an aggregate offering price of $125,000,000. While
an aggregate offering price of $125,000,000 of the 1996 Securities remained
unsold, the Offerors (a) filed with the Commission a registration statement on
Form S-3 (No. 333-26881) for the registration under the 1933 Act of up to
$400,000,000 (which includes the $125,000,000 of unsold 1996 Securities)
aggregate offering price of securities, including (i) the Preferred Securities,
(ii) the Preferred Securities Guarantee and the Undertakings, and (iii) junior
subordinated deferrable interest notes (the "Junior Subordinated Debt
Securities") to be issued and sold to the Trust by the Company, (b) have filed
such amendments thereto as have been required to the date hereof, and (c) will
file such additional amendments thereto as may hereafter be required. Such
registration statement, as amended, and the combined prospectus constituting a
part thereof (including, in each case, all documents incorporated or deemed to
be incorporated by reference therein pursuant to Item 12 of Form S-3 under the
1933 Act and the information, if any, deemed to be part thereof pursuant to Rule
430A(b) of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations")), as
2
<PAGE>
supplemented by a Prospectus Supplement, dated May 29, 1997, relating to the
Preferred Securities, the Preferred Securities Guarantee, the Undertakings and
the Junior Subordinated Debt Securities, and as from time to time further
amended or supplemented pursuant to the 1933 Act, the Securities Exchange Act of
1934, as amended (the "1934 Act"), or otherwise are hereinafter referred to as
the "1997 Registration Statement" and the "Prospectus," respectively, except
that if any revised prospectus shall be provided to the Underwriters by the
Offerors for use in connection with the offering of the Preferred Securities,
which differs from the Prospectus on file at the Commission at the time the 1997
Registration Statement becomes effective (whether or not such revised prospectus
is required to be filed by the Offerors pursuant to Rule 424(b) of the 1933 Act
Regulations) (each, a "Revised Prospectus"), the term "Prospectus" shall refer
to such Revised Prospectus from and after the time it is first provided to the
Underwriters for such use. All references in this Agreement to financial
statements and schedules and other information that is "contained," "included"
or "stated" in the 1994 Registration Statement, the 1995 Registration Statement,
the 1997 Registration Statement or the Prospectus (and all other references of
like import) shall be deemed to mean and include all such financial statements
and schedules and other information that are or are deemed to be incorporated by
reference in the 1994 Registration Statement, the 1995 Registration Statement,
the 1997 Registration Statement or the Prospectus, as the case may be; and all
references in this Agreement to amendments or supplements to the 1994
Registration Statement, the 1995 Registration Statement, the 1997 Registration
Statement or the Prospectus shall be deemed to mean and include the filing of
any document under the 1934 Act that is or is deemed to be incorporated by
reference in the 1994 Registration Statement, the 1995 Registration Statement,
the 1997 Registration Statement or the Prospectus, as the case may be, after the
time of execution of this Agreement.
The Offerors understand that the Underwriters propose to make a public
offering of the Preferred Securities as soon as the Representatives deem
advisable after the Pricing Agreement has been executed and delivered. 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"), as guaranteed by the Company with respect
to distributions and payments upon liquidation and redemption (the "Common
Securities Guarantee" and together with the Preferred Securities Guarantee, the
"Guarantees"), and will be used by the Trust to purchase the $128,865,979.40 of
Junior Subordinated Debt Securities issued by the Company. The Preferred
Secu rities and the Common Securities will be issued pursuant to the amended and
restated declaration of trust of the Trust, dated as of May 8, 1997 (the
"Declaration"), among the Company, as Sponsor, Wayne R. Huneke and Richard R.
Crowl (the "Regular Trustees") and Wilmington Trust Company, a Delaware banking
corporation, as Delaware Trustee and property trustee (the "Property Trustee"
and, together with the Regular Trustees, the "Trustees"), and the holders from
time to time of undivided beneficial interests in the assets of the Trust. The
Junior Subordinated Debt Securities will be issued pursuant to an indenture,
dated as of March 29, 1996 (the "Base Indenture"), between the Company and
Wilmington Trust Company, as trustee (the "Indenture Trustee"), and a supplement
to the Base Indenture, to be dated as of June 3, 1997 (the "Supplemental
Indenture," and together with the Base Indenture and any other amendments or
supplements thereto, the "Indenture"), between the Company and the Indenture
Trustee.
Section 1. Representations and Warranties. The Offerors jointly and
------------------------------
severally represent and warrant to each Underwriter as of the date hereof and
as of the date of the Pricing Agreement (such latter date being hereinafter
referred to as the "Representation Date") as follows:
(a) At the time the 1994 Registration Statement became
effective, at the time the 1995 Registration Statement became effective and
at the time the 1997 Registration Statement became effective, the 1994
Registration Statement,
3
<PAGE>
the 1995 Registration Statement and the 1997 Registration Statement
complied, and at the Representation Date, the 1994 Registration Statement,
the 1995 Registration Statement and the 1997 Registration Statement will
comply, in all material respects with the requirements of the 1933 Act and
the 1933 Act Regulations and the Trust Indenture Act of 1939, as amended
(the "1939 Act") and the rules and regulations of the Commission under the
1939 Act (the "1939 Act Regulations"), and did not, or will not, 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. The Prospectus, at the Representation Date (unless the term
"Prospectus" refers to a prospectus that has been provided to the
Underwriters by the Trust for use in connection with the offering of the
Preferred Securities and that differs from the Prospectus on file at the
Commission at the time the 1997 Registration Statement became effective, in
which case, at the time it is first provided to the Underwriters for such
use) and at the Closing Time (as defined herein), will not include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
--------
however, that the representations and warranties in this subsection shall
-------
not apply to (i) statements in or omissions from the 1994 Registration
Statement, the 1995 Registration Statement, the 1997 Registration Statement
or Prospectus made in reliance upon and in conformity with information
furnished to the Offerors in writing by any Underwriter through the
Representatives expressly for use in the 1994 Registration Statement, the
1995 Registration Statement, the 1997 Registration Statement or Prospectus
or (ii) that part of the 1994 Registration Statement, the 1995 Registration
Statement and the 1997 Registration Statement which constitutes the
Statement of Eligibility and Qualification (Form T-1) under the 1939 Act.
(b) The documents incorporated or deemed to be incorporated by
reference in the 1994 Registration Statement, the 1995 Registration
Statement, the 1997 Registration Statement or Prospectus, at the time they
were or (to the extent deemed to be incorporated by reference) hereafter
are filed with the Commission, complied and will comply in all material
respects with the requirements of the 1933 Act, the 1933 Act Regulations,
the 1934 Act and the rules and regulations of the Commission under the 1934
Act (the "1934 Act Regulations"), as applicable, and did not or will not
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, in the light of the circumstances under which they were made, not
misleading.
(c) Deloitte & Touche LLP, the accountants who certified the
financial statements and supporting schedules included or incorporated by
reference in the 1994 Registration Statement, the 1995 Registration
Statement and the 1997 Registration Statement, are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(d) The financial statements included in the 1994 Registration
Statement, the 1995 Registration Statement, the 1997 Registration Statement
or the Prospectus present fairly the financial position of the Company and
its consolidated subsidiaries as of the dates indicated and the results of
their operations for the periods specified; except as otherwise stated in
the 1994 Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement or Prospectus said financial statements have been
prepared in conformity with generally accepted accounting principles
applied on a consistent basis; the Company's ratios of earnings to fixed
charges (actual and, if any, pro forma) included in the Prospectus under
the captions "Ratio of Earnings to Fixed Charges" and "Ratio of Earnings to
Combined Fixed Charges and Preferred Stock Dividends" and in Exhibit 12 to
each of the 1994 Registration Statement, the 1995 Registration Statement
and the 1997 Registration Statement have been calculated in compliance with
Item 503(d) of Regulation S-K of the Commission and the supporting
schedules included in
4
<PAGE>
each of the 1994 Registration Statement, the 1995 Registration Statement
and the 1997 Registration Statement present fairly the information required
to be stated therein; and the other financial and statistical information
and data included or incorporated by reference in the 1994 Registration
Statement, the 1995 Registration Statement, the 1997 Registration Statement
or the Prospectus are accurately presented and prepared on a basis
consistent with such financial statements and the books and records of the
Company and its consolidated subsidiaries. There are no pro forma financial
statements required to be included in the Prospectus; nevertheless, the
Prospectus contains certain pro forma financial statements and other pro
forma financial information and such information presents fairly the
information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements, have been properly compiled on the pro forma bases described
therein, and the assumptions used in the preparation thereof are reasonable
and the adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein.
(e) The statutory financial statements of each of the Company's
insurance subsidiaries have for each relevant period been prepared in
accordance with accounting practices prescribed or permitted by the
National Association of Insurance Commissioners and, with respect to each
insurance subsidiary, the appropriate Insurance Department of the state of
domicile of such insurance subsidiary, and such accounting practices have
been applied on a consistent basis throughout the periods involved, except
as disclosed therein.
(f) Each of the Offerors meets, and at the respective times of
commencement and consummation of the offering of the Securities will meet,
the registrant requirements for use of Form S-3 and Rule 415 under the 1933
Act and the 1933 Act Regulations.
(g) Since the respective dates as of which information is given
in the 1994 Registration Statement, the 1995 Registration Statement, the
1997 Registration Statement and the Prospectus, except as otherwise stated
therein, (A) there has been no material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Trust or the Company and its subsidiaries, considered as
one enterprise, whether or not arising in the ordinary course of business,
(B) there have been no transactions entered into by the Trust or by the
Company or any of its subsidiaries, other than those in the ordinary course
of business, which are material with respect to the Trust or the Company
and its subsidiaries, considered as one enterprise, and (C) except for
regular quarterly dividends, there has been no dividend or distribution of
any kind declared, paid or made by the Company on any class of its capital
stock.
(h) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware with full corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the 1994
Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement and the Prospectus, to enter into and perform its
obligations under this Agreement, the Pricing Agreement, the Declaration,
the Indenture and each of the Guarantees and to purchase, own, and hold
the Common Securities issued by the Trust; and the Company is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure so to qualify would not have a
material adverse effect on the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise ("Material Adverse Effect").
5
<PAGE>
(i) All of the issued and outstanding shares of capital stock of
the Company have been duly authorized and validly issued, are fully paid
and non-assessable and are free of any preemptive or similar rights.
(j) Each subsidiary of the Company has been duly incorporated
and is validly existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, has full corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus or listed in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996 and is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify would not have a Material
Adverse Effect, and, where applicable, is duly licensed to conduct an
insurance business under the insurance laws of each jurisdiction in which
the conduct of its business requires such licensing and in which the
failure to be so licensed would have a Material Adverse Effect; all of the
issued and outstanding capital stock of each such subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and, except
for directors' qualifying shares and for certain shares of common stock of
the Company's subsidiary NWNL Northstar, Inc. ("Northstar") which are owned
by employees of Northstar, is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity.
(k) The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act with full trust
power and authority to own property and to conduct its business as
described in the 1997 Registration Statement and the Prospectus and to
enter into and perform its obligations under this Agreement, the Pricing
Agreement, the Preferred Securities, the Common Securities and the
Declaration and is authorized to do business in each jurisdiction in which
such qualification is required, except where the failure to so qualify
would not have a Material Adverse Effect; the Trust is not a party to or
otherwise bound by any agreement other than those described in the
Prospectus; the Trust is and will be classified for United States federal
income tax purposes as a grantor trust and not as an association taxable as
a corporation; and the Trust is and will be treated as a consolidated
subsidiary of the Company pursuant to generally accepted accounting
principles.
(l) The Common Securities have been duly authorized by the
Declaration and, when issued and delivered by the Trust to the Company
against payment therefor as described in the 1997 Registration Statement
and Prospectus, will be validly issued and (subject to the terms of the
Declaration) fully paid and nonassess able undivided beneficial interests
in the assets of the Trust and will conform to all statements relating
thereto contained in the Prospectus; the issuance of the Common Securities
is not subject to preemptive or other similar rights; and at the Closing
Time all of the issued and outstanding Common Securities of the Trust will
be directly owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(m) This Agreement has been, and at Closing Time the Pricing
Agreement will have been, duly authorized, executed and delivered by each
of the Offerors.
(n) The Declaration has been duly authorized by the Company and,
at the Closing Time, will have been duly executed and delivered by the
Company and the Regular Trust-
6
<PAGE>
ees, and will, at the Closing Time, be a valid and binding obligation of
the Company and the Regular Trustees, enforceable against the Company and
the Regular Trustees in accordance with its terms, except to the extent
that enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors rights
generally or by general principles of equity (regardless of whether
enforcement is considered in a proceeding at law or in equity) (the
"Bankruptcy Exceptions") and will conform in all material respects to the
statements relating thereto in the Prospectus; and the Declaration, at the
Closing Time, will have been duly qualified under the 1939 Act.
(o) The Preferred Securities Guarantee Agreement has been duly
authorized by the Company and, when validly executed and delivered by the
Company, will at the Closing Time constitute a valid and bind ing
obligation of the Company, enforceable against the Company in accordance
with its terms except to the extent that enforcement thereof may be limited
by the Bankruptcy Exceptions, and each of the Guarantees and the Preferred
Securities Guarantee Agreement will conform in all material respects to
the statements relating thereto contained in the Prospectus; and the
Preferred Securities Guarantee Agreement, at the Closing Time, will have
been duly qualified under the 1939 Act.
(p) The Preferred Securities have been duly authorized by the
Declaration and, when issued and delivered pursuant to this Agreement
against payment of the consideration set forth in the Pricing Agreement,
will be validly issued and fully paid and non-assessable undivided
beneficial interests in the Trust, will be entitled to the benefits of the
Declaration and will in all material respects conform to the statements
relating thereto contained in the Prospectus; the issuance of the Preferred
Securities is not subject to preemptive or other similar rights; and
holders of Preferred Securities will be entitled to the same limitation of
personal liability under Delaware law as extended to stockholders of
private corporations for profit.
(q) The Base Indenture has been duly authorized, executed and
delivered by the Company and, assuming the authorization, execution and
delivery by the Trustee, constitutes 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 the
Bankruptcy Exceptions; the Base Indenture conforms in all material respects
to the statements relating thereto contained in the Prospectus; the Base
Indenture has been duly qualified under the 1939 Act; the Supplemental
Indenture has been duly authorized, and when validly executed and delivered
by the Company and assuming the authorization, execution and delivery by
the Trustee, will at the Closing Time constitute, 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 the Bankruptcy Exceptions; the Supplemental Indenture will conform in
all material respects to the statements relating thereto contained in the
Prospectus; and at the Closing Time, the Supplemental Indenture will have
been duly qualified under the 1939 Act.
(r) The Junior Subordinated Debt Securities have been duly
authorized by the Company and, at the Closing Time, will have been duly
executed by the Company and, when authenticated in the manner provided for
in the Indenture and delivered against payment therefor as described in the
Prospectus, will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms except to
the extent that enforcement thereof may be limited by the Bankruptcy
Exceptions, will be in the form contemplated by, and entitled to the
benefits of, the Indenture and will conform in all material respects to the
statements relating thereto in the Prospectus.
7
<PAGE>
(s) The Supplemental Indenture, the Declaration and the
Preferred Securities Guarantee Agreement are in substantially the
respective forms filed as exhibits to the 1997 Registration Statement.
(t) The Company's obligations under the Guarantees are
subordinate and junior in right of payment to all liabilities of the
Company and are, or will be, pari passu with the most senior preferred
---- -----
stock now or hereafter issued by the Company.
(u) The Junior Subordinated Debt Securities are subordinate and
junior in right of payment to all "Senior Debt" (as defined in the
Indenture) of the Company.
(v) Each of the Regular Trustees of the Trust is an employee of
the Company and has been duly authorized by the Company to execute and
deliver the Declaration.
(w) None of the Offerors is, and upon the issuance and sale of
the Preferred Securities as contemplated herein and the application of the
net proceeds therefrom as described in the Prospectus will be, an
"investment company" or a company "controlled" by an "investment company"
within the meaning of the Investment Company Act of 1940, as amended (the
"1940 Act").
(x) Neither the Company nor any of its subsidiaries is in
violation of its respective charter or by-laws; the Trust is not in
violation of the Declaration or its certificate of trust filed with the
State of Delaware on May 8, 1997 (the "Certificate of Trust"); none of the
Company, any of its subsidiaries or the Trust is in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan agreement,
note, lease or other instrument to which the Company, any of its
subsidiaries or the Trust is a party or by which it or any of them may be
bound, or to which any of the property or assets of the Company, any of its
subsidiaries or the Trust is subject, except for such defaults that would
not have a Material Adverse Effect; and the execution, delivery and
performance of this Agreement, the Pricing Agreement, the Declaration, the
Preferred Securities, the Common Securities, the Indenture, the Junior
Subordinated Debt Securities, the Preferred Securities Guarantee Agreement
and the Guarantees and the consummation of the transactions contemplated
herein and therein and compliance by the Offerors with their respective
obligations hereunder and thereunder have been duly authorized by all
necessary action (corporate or other wise) on the part of the Offerors and
do not and will not result in any violation of the respective charters or
by-laws of the Company or any of its subsidiaries, or the Declaration or
Certificate of Trust and do not and will not conflict with, or result in a
breach of any of the terms or provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Trust, the Company or any of its
subsidiaries under (A) any contract, indenture, mortgage, loan agreement,
note, lease or other agreement or instrument to which the Trust, the
Company or any of its subsidiaries is a party or by which it may be bound
or to which any of its properties may be subject (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a Material Adverse Effect) or (B) any existing applicable
law, rule, regulation, judgment, order or decree of any government,
governmental instru mentality or court, domestic or foreign, or any
regulatory body or administrative agency or other governmental body having
jurisdiction over the Trust, the Company, or any of its subsidiaries or any
of their respective properties.
8
<PAGE>
(y) There are no legal or governmental proceedings pending or,
to the best knowledge of the Company or the Trust after due inquiry,
threatened, against the Company, any of its subsidiaries or the Trust, or
to which the Company, any of its subsidiaries or the Trust is subject, or
to which any of their respective properties is subject, that are required
to be described in the 1994 Registration Statement, the 1995 Registration
Statement, the 1997 Registration Statement or the Prospectus but are not
described as required, and there are no agreements, contracts, indentures,
leases or other instruments that are required to be described in the 1994
Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement or the Prospectus or to be filed as an exhibit to
the 1994 Registration Statement, the 1995 Registration Statement or the
1997 Registration Statement that are not described or filed as required by
the 1933 Act, the 1933 Act Regulations, the 1934 Act or the 1934 Act
Regulations.
(z) No authorization, approval, consent or order of any court or
governmental authority or agency is necessary in connection with the
issuance and sale of the Common Securities or the offering, issuance and
sale of the Preferred Securities, the Junior Subordinated Debt Securities
or the Guarantees here under, except such as may be required under the 1933
Act or the 1933 Act Regulations or state securities laws and the
qualification of the Declaration, the Preferred Securities Guarantee
Agreement and the In denture under the 1939 Act.
(aa) Each of the Company and its subsidiaries has good and
marketable title to all properties and assets described in the Prospectus
as owned by it, free and clear of all liens, charges, encumbrances or
restrictions, except such as (A) are described in the Prospectus or (B)
singly or in the aggregate are neither material in amount nor materially
significant in relation to the business of the Company and its
subsidiaries, considered as one enterprise; all of the leases and subleases
material to the business of the Company and its subsidiaries, considered
as one enterprise, and under which the Company or any of its subsidiaries
holds properties described in the Prospectus, are in full force and
effect, and neither the Company nor any of its subsidiaries has any notice
of any claim of any sort that has been asserted by anyone adverse to the
rights of the Company or any of its subsidiaries under any of the leases or
subleases mentioned above, or affecting or questioning the rights of such
corporation to the continued possession of the leased or subleased premises
under any such lease or sublease which claim would have a Material Adverse
Effect.
(bb) Each of the Trust, the Company, and its subsidiaries owns,
possesses, or has obtained, licenses, franchises, consents, orders,
approvals, permits, certificates, and other authorizations ("permits")
issued by the appropriate state, federal or foreign regulatory agencies or
bodies necessary to conduct the business now operated by them, except where
the failure to possess such permits would not have a Material Adverse
Effect; and none of the Trust, the Company, or any of its subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would materially and
adversely affect the condition, financial or otherwise, or the earnings,
business affairs or business prospects of the Trust or would have a
Material Adverse Effect.
(cc) Each of the Company and its subsidiaries owns or possesses,
or can acquire on reasonable terms, adequate patents, patent licenses,
trademarks, service marks and trade names necessary to carry on its
business as presently conducted, and neither the Company nor any of its
subsidiaries has received any notice of infringement of or conflict with
asserted rights of others with respect to any patents, patent licenses,
trademarks, service marks or trade names that in the
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aggregate, if the subject of an unfavorable decision, ruling or finding,
could have a Material Adverse Effect.
(dd) No labor problem exists with the employees of the Company
or any of its subsidiaries, or is imminent, that could have a Material
Adverse Effect, and the Company is not aware of any existing or imminent
labor disturbance by the employees of any of its or any of its
subsidiaries' principal suppliers, contractors or customers that could be
expected to have a Material Adverse Effect.
(ee) The Company and the Trust have not taken and will not 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.
(ff) The Company and its subsidiaries have filed all federal,
state and local tax returns and other reports which have been required to
be filed and have paid all taxes and fees indicated by said returns and
reports and franchise reports and all assessments received by them or any
of them to the extent that such taxes and/or fees have become due, except
where being contested in good faith and for which the Company has
established adequate reserves.
(gg) Each of the Offerors is in compliance with all provisions
of Section 1 of the Laws of Florida, Chapter 92-198, An Act Relating to
Disclosure of Doing Business With Cuba.
(hh) No holder of any outstanding security of the Company has
any right to require registration of such security because of the filing of
the 1997 Registration Statement or consummation of the transaction
contemplated by this Agreement.
Any certificate signed by an officer of the Company delivered to the
Representatives or counsel for the Underwriters shall be deemed a representation
and warranty by the Company to each Underwriter as to the matters covered
thereby.
Section 2. Sale and Delivery to Underwriters; Closing.
------------------------------------------
(a) On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Trust
agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Trust, at
the price per Preferred Security set forth in the Pricing Agreement, the number
of Preferred Securities set forth in Schedule A opposite the name of such
Underwriter (except as otherwise provided in the Pricing Agreement), plus any
additional number of Preferred Securities that such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof.
The purchase price per Preferred Security to be paid by the several
Underwriters for the Preferred Securities shall be an amount equal to the
initial public offering price. The public offering price per Preferred Security
shall be a fixed price to be determined by agreement between the Representatives
and the Offerors. The public offering price and the purchase price, when so
determined, shall be set forth in the Pricing Agreement. In the event that such
prices have not been agreed upon and the Pricing Agreement has not been executed
and delivered by all parties thereto by the close of business on the fourth
business day following the date of this Agreement, this Agreement shall
terminate forthwith, without liability of any party to any other party, unless
otherwise agreed to by the Offerors and the Representatives. As compensation to
the Underwriters for their commitments hereunder and in view of the fact that
the proceeds
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of the sale of the Preferred Securities (together with the entire proceeds from
the sale by the Trust to the Company of the Common Securities) will be used to
purchase the Junior Subordinated Debt Securities of the Company, the Company
hereby agrees to pay at Closing Time to the Representatives, for the accounts of
the several Underwriters, a commission per Preferred Security determined by
agreement between the Representatives and the Company for the Preferred
Securities to be delivered by the Trust hereunder at Closing Time. The
commission, when so determined, shall be set forth in the Pricing Agreement.
(b) Payment of the purchase price for, and delivery of certificates
for, the Preferred Securities shall be made at the office of Faegre & Benson
LLP, Professional Limited Liability Partnership, Minneapolis, Minnesota, or at
such other place as shall be agreed upon by the Representatives and the Trust,
at 10:00 A.M. Minneapolis time on the third business day (unless postponed in
accordance with the provisions of Section 10) after execution of the Pricing
Agreement, or such other time not later than ten business days after such date
as shall be agreed upon by the Representatives and the Offerors (such time and
date of payment and delivery being herein called "Closing Time"). Payment shall
be made to the Trust by a wire transfer of immediately available funds to an
account designated by the Trust, against delivery to the Representatives for the
respective accounts of the Underwriters of certificates for the Preferred
Securities to be purchased by them. Certificates for the Preferred Securities
shall be in such denominations and registered in such names as the
Representatives may request in writing at least two business days before the
Closing Time. It is understood that each Underwriter has authorized the
Representatives, for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Preferred Securities which it has agreed
to purchase. The Representatives, individually and not as Representatives of
the Underwriters, may (but shall not be obligated to) make payment of the
purchase price for the Preferred Securities to be purchased by any Underwriter
whose check has not been received by the Closing Time, but such payment shall
not relieve such Underwriter from its obligations hereunder.
The certificate(s) for the Preferred Securities will be made available
for examination and packaging by the Representatives not later than 10:00 A.M.
on the last business day prior to the Closing Time.
At the Closing Time the Company will pay, or cause to be paid, the
commission payable at such time to the Underwriters under Section 2 hereof by a
wire transfer of immediately available funds to an account designated by Merrill
Lynch, Pierce, Fenner & Smith Incorporated.
Section 3. Covenants of the Offerors. Each of the Offerors jointly
-------------------------
and severally covenant with each Underwriter as follows:
(a) The Offerors will advise the Representatives promptly and, if
requested by the Representatives, will confirm such advice in writing: (i) of
any request by the Commission for amendment of or a supplement to the 1994
Registration Statement, the 1995 Registration Statement, the 1997 Registration
Statement or the Prospectus or for additional information; (ii) of the issuance
by the Commission of any stop order suspending the effectiveness of the 1994
Registration Statement, the 1995 Registration Statement, the 1997 Registration
Statement or of the suspension of qualification of the Preferred 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 the first
sentence of subsection (d) below, of any change in the Company's condition,
financial or otherwise, earnings, business affairs, business prospects,
properties, net worth or results of operations, or of the happening of any
event, which makes any statement of a material fact made in the 1994
Registration Statement, the 1995 Registration Statement, the 1997 Registration
Statement or the Prospectus (as then amended or supplemented) untrue or which
requires the making of any additions to or changes in the 1994 Registration
Statement, the 1995 Registration Statement,
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<PAGE>
the 1997 Registration Statement or the Prospectus (as then amended or
supplemented) in order to state a material fact required by the 1933 Act or the
1933 Act Regulations 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 1933 Act or
any other law. If at any time the Commission shall issue any stop order
suspending the effectiveness of the 1994 Registration Statement, the 1995
Registration Statement or the 1997 Registration Statement, the Offerors will
make every reasonable effort to obtain the withdrawal of such order at the
earliest possible time.
(b) During such period as a prospectus is required by the 1933 Act to
be delivered in connection with sales by any Underwriter or dealer, the Offerors
will give the Representatives notice of their intention to file or prepare (i)
any amendment to the 1994 Registration Statement, the 1995 Registration
Statement or the 1997 Registration Statement (including any post-effective
amendment), (ii) any amendment or supplement to the Prospectus (including any
revised prospectus which the Offerors propose for use by the Underwriters in
connection with the offering of the Preferred Securities which differs from the
prospectus on file at the Commission at the time the 1997 Registration Statement
becomes effective, whether or not such revised prospectus is required to be
filed pursuant to Rule 424(b) of the 1933 Act Regulations), or (iii) any
document that would as a result thereof be incorporated by reference in the
Prospectus whether pursuant to the 1933 Act, the 1934 Act or otherwise, will
furnish the Representatives with copies of any such amendment, supplement or
other document a reasonable amount of time prior to such proposed filing or use,
as the case may be, and will not file any such amendment, supplement or other
document or use any such prospectus to which the Representatives or counsel for
the Underwriters shall reasonably object.
(c) The Offerors will furnish to the Representatives, without charge
(i) signed copies of the 1994 Registration Statement, the 1995 Registration
Statement and the 1997 Registration Statement certified by an officer of the
Company to be in the form originally filed with the Commission and of each
amendment thereto, including financial statements and all exhibits to the 1994
Registration Statement, the 1995 Registration Statement and the 1997
Registration Statement, (ii) such number of conformed copies of the 1994
Registration Statement, the 1995 Registration Statement and the 1997
Registration Statement as originally filed and of each amendment thereto, but
without exhibits, as the Underwriters may reasonably request, (iii) such number
of copies of the documents incorporated or deemed to be incorporated by
reference therein, without exhibits, as the Underwriters may reasonably request,
and (iv) one copy of the exhibits to the documents incorporated or deemed to be
incorporated by reference therein.
(d) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as the Prospectus is
required by the 1933 Act or the 1933 Act Regulations 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
the Underwriters may request. The Offerors consent to the use of the Prospectus
(and of any amendment or supplement thereto) in accordance with the provisions
of the 1933 Act, the 1933 Act Regulations 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 the 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 1933
Act or the 1933 Act Regulations to be delivered in connection with sales by any
Underwriter or dealer. If during such period of time any event shall occur that
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 1934
Act or the 1934 Act Regulations any document which, upon filing,
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<PAGE>
will be incorporated or deemed to be incorporated by reference therein) in order
to comply with the 1933 Act, the 1933 Act Regulations or any other law, the
Offerors will forthwith prepare and, subject to the provisions of paragraph (b)
above, file with the Commission an appropriate supplement or amendment or
document which, upon filing, will be incorporated or deemed to be incorporated
by reference therein, and will expeditiously furnish to the Underwriters and
dealers a reasonable number of copies thereof. In the event that the Offerors
and the Underwriters agree that the Prospectus should be amended or
supplemented, the Offerors, if requested by the Representatives, will promptly
issue a press release announcing or disclosing the matters to be covered by the
proposed amendment or supplement.
(e) The Offerors will cooperate with the Underwriters and with
counsel for the Underwriters in connection with the registration or
qualification of the Preferred Securities and Junior Subordinated Debt
Securities for offering and sale by the Underwriters and by dealers under the
securities or Blue Sky laws of such jurisdictions as the Underwriters 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 Offerors be obligated to qualify to do
- --------
business in any jurisdiction where they are not now so qualified or to take any
action which would subject them to service of process in suits, other than those
arising out of the offering or sale of the Preferred Securities and the Junior
Subordinated Debt Securities, in any jurisdiction where they are not now so
subject.
(f) The Company will, on behalf of the Trust, make generally
available to the Trust's security holders as soon as practicable but not later
than 45 days (unless such period corresponds to the Company's fiscal year, in
which case 90 days) after the close of the period covered thereby, an earnings
statement of the Company (in form complying with the provisions of Section 11(a)
of the 1933 Act and Rule 158 of the 1933 Act Regulations) covering a twelve-
month period beginning not later than the first day of the Company's fiscal
quarter next following the "effective date" (as defined in said Rule 158) of the
1997 Registration Statement.
(g) The Offerors will use their best efforts to have the Preferred
Securities listed, subject to notice of issuance, on the New York Stock Exchange
on or before the Closing Time; if the Preferred Securities are exchanged for
Junior Subordinated Debt Securities, the Company will use its best efforts to
have the Junior Subordinated Debt Securities listed on the exchange on which the
Preferred Securities were then listed.
(h) During a period of 90 days from the date of the Pricing
Agreement, neither the Trust nor the Company will, without the prior written
consent of Merrill Lynch, (i) directly or indirectly, offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase or otherwise
transfer or dispose of any Preferred Securities, any security convertible into
or exchangeable into or exercisable for Preferred Securities or any equity
securities substantially similar to the Preferred Securities or file any
registration statement under the 1933 Act with respect to the foregoing or (ii)
enter into any swap or any other agreement or any transaction that transfers, in
whole or in part, directly or indirectly, the economic consequence of ownership
of the Preferred Securities, whether any swap or transaction described in clause
(i) or (ii) above is to be settled by delivery of Preferred Securities or such
other securities, in cash or otherwise. The foregoing sentence shall not apply
to the Preferred Securities to be sold hereunder.
(i) The Offerors will apply the net proceeds from the sale of the
Preferred Securities substantially in accordance with the description set forth
in the Prospectus under "Use of Proceeds."
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(j) Except as stated in the Prospectus, the Offerors will not take,
directly or indirectly, any action designed to or that might reasonably be
expected to cause or result in stabilization or maintenance of the price of the
Preferred Securities.
Section 4. Payment of Expenses. The Company will pay all expenses
-------------------
incident to the performance of each Offeror's obligations under this Agreement,
including, but not limited to, (i) the printing and filing of the 1994
Registration Statement, the 1995 Registration Statement and the 1997
Registration Statement as originally filed and of each amendment thereto, (ii)
the preparation, issuance and delivery of the certificates for the Preferred
Securities to the Underwriters, (iii) the fees and disbursements of the
Company's and the Trust's counsel and accountants, (iv) the qualification of the
Preferred Securities and the Junior Subordinated Debt Securities under
securities laws in accordance with the provisions of Section 3(e) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of any Blue Sky survey, (v) the printing and delivery to the Underwriters of
copies of the 1994 Registration Statement, the 1995 Registration Statement and
the 1997 Registration Statement as originally filed and of each amendment
thereto, of each preliminary prospectus, and of the Prospectus and any
amendments or supplements thereto, (vi) the printing and delivery to the
Underwriters of copies of any Blue Sky survey, (vii) the fee of the National
Association of Securities Dealers, Inc., if any, (viii) the fees and expenses of
the Indenture Trustee, including the fees and disbursements of counsel for the
Indenture Trustee in connection with the Indenture and the Junior Subordinated
Debt Securities, (ix) the fees and expenses of the Property Trustee, including
the fees and disbursements of counsel for the Property Trustee in connection
with the Declaration and the Certificate of Trust, (x) any fees payable in
connection with the rating of the Preferred Securities and the Junior
Subordinated Debt Securities, (xi) the fees and expenses incurred in connection
with the listing of the Preferred Securities and, if applicable, the Junior
Subordinated Debt Securities on the New York Stock Exchange, (xii) the costs and
charges of any transfer agent or registrar and (xiii) the cost of qualifying the
Preferred Securities with The Depository Trust Company.
If this Agreement is terminated by the Representatives in accordance
with the provisions of Section 5 hereof or Section 9(a)(i) hereof or if this
Agreement shall be terminated by the Underwriters because of any failure or
refusal on the part of the Company or the Trust to comply with the terms or
fulfill any of the conditions of this Agreement, the Company shall reimburse the
Underwriters for all of their reasonable out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Underwriters.
Section 5. Conditions of Underwriters' Obligations. The obligations
---------------------------------------
of the Underwriters hereunder are subject to the accuracy of the representations
and warranties of the Offerors herein contained, to the performance by the
Offerors of their obligations hereunder, and to the following further
conditions:
(a) The 1997 Registration Statement has become effective on May 27,
1997; and at Closing Time no stop order suspending the effectiveness of the
1994 Registration Statement, the 1995 Registration Statement or the 1997
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission. The Prospectus shall have
been filed with the Commission pursuant to Rule 424(b) within the applicable
time period prescribed for such filing by the 1933 Act Regulations and prior to
Closing Time the Offerors shall have provided evidence satisfactory to the
Representatives of such timely filing.
(b) At Closing Time the Representatives shall have received:
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<PAGE>
(1) The favorable opinion, dated as of Closing Time, of Faegre &
Benson LLP, counsel for the Offerors, in form and substance satisfactory to
counsel for the Underwriters, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with corporate power and authority to own, lease and operate its
properties, to conduct its business as described in the Prospectus and to
enter into this Agreement and to issue and deliver the Junior Subordinated
Debt Securities, the Guarantees and the Undertakings as provided herein.
(ii) To the best of such counsel's knowledge and information
after due inquiry, the Company is duly qualified to transact business as a
foreign corporation and is in good standing in each other jurisdiction in
which it owns or leases property of a nature, or transacts business of a
type, that would make such qualification necessary, except where the
failure to so qualify would not have a Material Adverse Effect.
(iii) The statements (A) in the Prospectus Supplement referred
to in the third paragraph of this Agreement under the captions "The Trust",
"Risk Factors", "Description of the Preferred Securities" (except under the
subsection "Book-Entry Only Issuance-The Depository Trust Company"),
"Description of the Junior Subordinated Debt Securities" and "Effect of
---
Obligations Under the Junior Subordinated Debt Securities and the Preferred
Securities Guarantee", and (B) in the combined prospectus referred to in
such paragraph under the captions "The Trust", "Particular Terms of
Subordinated Debt Securities Issued in Connection with Preferred
Securities", "Description of Preferred Securities of the Trust" and "The
Preferred Securities Guarantee", insofar as such statements constitute
matters of law applicable to the Offerors or summaries of documents, fairly
present the information required to be included therein in all material
respects.
(iv) Each of the 1994 Registration Statement, the 1995
Registration Statement and the 1997 Registration Statement is effective
under the 1933 Act and, to the best of their knowledge and information
after due inquiry, no stop order suspending the effectiveness of the 1994
Registration Statement, the 1995 Registration Statement or the 1997
Registration Statement has been issued under the 1933 Act, and no
proceedings therefor have been initiated or threatened by the Commission.
(v) The 1994 Registration Statement, at the date of filing of
the Company's Quarterly Report on Form 10-Q for the period ended September
30, 1995 (the "9/30/95 Form 10-Q"), and the 1995 Registration Statement, at
the date of filing of the Company's Annual Report on Form 10-K for the year
ended December 31, 1996 (the "1996 Form 10-K"), the 1997 Registration
Statement, at the date it became effective, and the Prospectus at the date
it was filed pursuant to Rule 424(b) under the 1933 Act (or if a Revised
Prospectus, at the date it was first provided to the Underwriters for use
in offering the Preferred Securities) (other than the financial statements
and the notes thereto and related schedules and other financial data
therein, as to which such counsel need ex press no opinion), complied as to
form in all material respects with the requirements of the 1933 Act and the
1933 Act Regulations; and the Declaration, the Indenture and the Preferred
Securities Guarantee Agreement filed with the Commission as part of the
Registration Statement complied as to form in all material respects with
the requirements of the 1939 Act and the 1939 Act Regulations.
(vi) Each of the documents incorporated by reference in the
1994 Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement or the Prospectus at the time
15
<PAGE>
they were filed (other than the financial statements and the notes thereto
and related schedules and other financial data therein, as to which such
counsel need express no opinion), complied in all material respects with
the requirements as to form with the 1934 Act and the 1934 Act Regulations.
(vii) Each of the Offerors meets the registrant requirements for
use of Form S-3 under the 1933 Act Regulations.
(viii) The Common Securities, the Preferred Securities, the
Junior Subordinated Debt Securities, each of the Guarantees, the
Declaration, the Indenture and the Preferred Securities Guarantee Agreement
conform in all material respects to the descriptions thereof contained in
the Prospectus.
(ix) All of the issued and outstanding Common Securities of the
Trust are owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equitable right.
(x) This Agreement and the Pricing Agreement have been duly
authorized, executed and delivered by the Company.
(xi) The Declaration has been duly qualified under the 1939
Act.
(xii) The Preferred Securities Guarantee Agreement has been duly
authorized, executed and delivered by the Company; the Preferred Securities
Guarantee Agreement, assuming it is duly authorized, executed, and
delivered by the Guarantee Trustee, constitutes a valid and binding
obligation of the Company, en forceable against the Company in accordance
with its terms, except to the extent that enforcement thereof may be
limited by Bankruptcy Exceptions; and the Preferred Securities Guarantee
Agreement has been duly qualified under the 1939 Act.
(xiii) The Indenture has been duly executed and delivered by the
Company and, assuming due authorization, execution, and delivery thereof by
the Indenture Trustee, is a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except to the
extent that enforcement thereof may be limited by the Bankruptcy
Exceptions, and the Indenture has been duly qualified under the 1939 Act.
(xiv) The Junior Subordinated Debt Securities are in the form
contemplated by the Indenture, have been duly authorized, executed and
delivered by the Company and, when authenticated by the Indenture Trustee
in the manner provided for in the Indenture and delivered against payment
therefor, will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, except to
the extent that enforcement thereof may be limited by the Bankruptcy
Exceptions.
(xv) The Junior Subordinated Debt Securities are subordinate
and junior in right of payment to all "Senior Debt" (as defined in the
Indenture) of the Company.
(xvi) Neither the Company nor the Trust is, and upon the
issuance and sale of the Preferred Securities as herein contemplated and
the application of the net proceeds thereunder as described in the
Prospectus will be, an "investment company" or a company "controlled" by
an "investment company" within the meaning of the 1940 Act.
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(xvii) The statements set forth in the Prospectus Supplement
referred to in the third paragraph hereof under the caption "United States
Federal Income Taxation" constitute a fair and accurate summary of the
matters addressed therein, based upon current law and the assumptions
stated or referred to therein.
(xviii) Under current law, the Trust will be classified for
United States federal income tax purposes as a grantor trust and not as an
association taxable as a corporation; accordingly, for United States
federal income tax purposes, each holder of Preferred Securities generally
will be considered the owner of an undivided interest in the Junior
Subordinated Debt Securities, and each holder will be required to include
in its gross income any original issue discount accrued with respect to its
allocable share of the Junior Subordinated Debt Securities.
(xix) For federal income tax purposes, (a) the Junior
Subordinated Debt Securities will constitute indebtedness of the Company
and (b) the interest on the Junior Subordinated Debt Securities will be
deductible by the Company on an economic accrual basis in accordance with
Section 163(e) of the Internal Revenue Code of 1986, as amended, and
Treasury Regulation Section 1.163-7.
(xx) No authorization, approval, consent or order of any
federal or Minnesota governmental authority or agency is required in
connection with the issuance and sale of the Common Securities or the
offering of the Preferred Securities, the Junior Subordinated Debt
Securities or the Guarantees, except (a) such as may be required under the
1933 Act or the 1933 Act Regulations or state securities law, and (b) the
qualification of the Declaration, the Preferred Securities Guarantee
Agreement and the Indenture under the 1939 Act and 1939 Act Regulations.
(xxi) To the best of such counsel's knowledge and information
after due inquiry, the Trust is not required to be authorized to do
business in any other jurisdiction and the Trust is not a party to or
otherwise bound by any agreement other than those described in the
Prospectus.
(xxii) The Declaration has been duly authorized, executed and
delivered by the Company and the Regular Trustees.
(xxiii) The Trust is not in violation of its Certificate of
Trust or the Declaration or, to the best of such counsel's knowledge and
information after due inquiry, in default in the performance or observance
of any material obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan agreement, note, lease or any other
instrument of which the Trust is a party or by which it may be bound, or to
which any of the property or assets of the Trust is subject.
(xxiv) The execution, delivery and performance of this Agreement,
the Pricing Agreement, the Declaration, the Preferred Securities, the
Common Securities, the Indenture, the Junior Subordinated Debt Securities,
the Preferred Securities Guarantee Agreement, and the Guarantees; the
consummation of the transactions contemplated herein and therein; and the
compliance by each of the Offerors with their respective obligations
hereunder and thereunder do not and will not result in any violation of the
charter or bylaws of the Company and, to the best of their knowledge and
information after due inquiry do not and will not conflict with, or result
in, a breach of any of the terms or provisions of, or constitute a default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Trust or the Company under
(A)
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any contract, indenture, mortgage, loan agreement, note, lease or any other
agreement or instrument to which the Trust or the Company or any of its
subsidiaries is a party or by which it may be bound or to which any of its
properties may be subject (except for such conflicts, breaches or defaults
or liens, charges or encumbrances that would not have a Material Adverse
Effect on the condition (financial or otherwise), earnings, business
affairs or business prospects of the Trust or the Company and its
subsidiaries, considered as one enterprise), (B) with respect to the
Company and its subsidiaries, any existing applicable law, rule or
regulation (other than the securities or blue sky laws of the various
states, as to which such counsel need express no opinion) or (C) any
judgment, order or decree of any government, governmental instrumentality
or court, domestic or foreign, or any regulatory body or administrative
agency or other governmental body having jurisdiction over the Company or
any of its subsidiaries or any of their respective properties.
In connection with such counsel's participation in the preparation of
the 1994 Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement and the Prospectus, such counsel need not
independently verify the accuracy, completeness or fairness of the
statements contained or incorporated therein, and the limitations inherent
in the examination made by such counsel and the knowledge available to it
are such that such counsel need not assume any responsibility for such
accuracy, completeness or fairness (except as otherwise specifically stated
in subparagraph (iii) above); however, on the basis of such counsel's
review of the 1994 Registration Statement, the 1995 Registration Statement,
the 1997 Registration Statement, the Prospectus and the documents
incorporated by reference therein and such counsel's participation in
conferences in connection with the preparation of the 1994 Registration
Statement, the 1995 Registration Statement, the 1997 Registration Statement
and the Prospectus, and relying as to questions of fact, to the extent
necessary, upon certificates of officers of the Company, such counsel does
not believe that the 1994 Registration Statement at the date of filing of
the 9/30/95 Form 10-Q, the 1995 Registration Statement, at the date of
filing of the 1996 Form 10-K, or the 1997 Registration Statement at the
time of filing and at the time it became effective (in each case including
the documents then incorporated by reference), considered as a whole as of
such dates, contained any 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 such counsel does not
believe that the Prospectus, at the time the Prospectus was filed with the
Commission pursuant to Rule 424(b) of the 1933 Act Regulations (or, if a
Revised Prospectus, at the date it was first provided to the Underwriters
for use in offering the Preferred Securities) and on the date of such
opinion (in each case including the documents then incorporated by
reference) considered as a whole as of such dates, contained or contains
any untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
However, such counsel need not express any opinion or belief as to (x) any
document filed by the Company under the 1934 Act, whether before or after
the date of the filing of its 1994 Form 10-K or the effective date of the
1997 Registration Statement, except to the extent that any such document is
a document incorporated by reference in the 1994 Registration Statement on
the date of the filing of its 9/30/95 10-Q, the 1995 Registration Statement
on the date of the filing of its 1996 Form 10-K or the 1997 Registration
Statement at its effective date and the date hereof, read together with the
1994 Registration Statement, the 1995 Registration Statement or the 1997
Registration Statement, as the case may be, and considered as a whole or is
a document incorporated by reference read together with the Prospectus at
the time the Prospectus was filed with the Commission pursuant to Rule
424(b) of the 1933 Act Regulations and considered as a whole, (y) the
financial statements and the notes thereto and related schedules and other
financial data included or incorporated by reference in the 1994
Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement
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or the Prospectus or (z) those parts of the 1994 Registration Statement,
the 1995 Registration Statement or the 1997 Registration Statement that
constitute statements of eligibility of the Indenture Trustee, the
Guarantee Trustee or the Property Trustee under the 1939 Act.
In giving its opinion, Faegre & Benson LLP may rely as to matters of
New York law upon the opinion of Sidley & Austin, counsel for the Underwriters,
which shall be delivered in accordance with Section 5(b)(5) hereof.
(2) The favorable opinion, dated as of Closing Time, of Richard
R. Crowl, Esq., Senior Vice President, General Counsel and Secretary of the
Company, in form and substance satisfactory to counsel for the Underwriters, to
the effect that:
(i) Each subsidiary of the Company has been duly incorporated
and is validly existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the 1994 Registration Statement, the 1995 Registration
Statement, the 1997 Registration Statement or the Prospectus and, to the
best of such counsel's knowledge and information after due inquiry, is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required, and,
where applicable, is duly licensed to conduct an insurance business under
the insurance laws of each jurisdiction in which the conduct of its
business requires such licensing and in which the failure to be so licensed
would materially adversely affect the condition, financial or otherwise,
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; all of the issued and
outstanding capital stock of ReliaStar Life Insurance Company, Northern
Life Insurance Company, Northstar, Northstar Investment Management
Corporation, ReliaStar United Services Life Insurance Company and ReliaStar
Bankers Security Life Insurance Company has been duly authorized and
validly issued, is fully paid and non-assessable and, except for directors'
qualifying shares and for certain shares of common stock of Northstar which
are owned by employees of Northstar, is owned by the Company, directly or
through subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity.
(ii) There are no legal or governmental proceedings pending or,
to the best of such counsel's knowledge and information after due inquiry,
threatened, or statutes, which are required to be disclosed in the 1994
Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement or the Prospectus other than those disclosed
therein, and all pending legal or governmental proceedings to which the
Company or any Subsidiary is a party or to which any of their property or
assets is subject which are not described in the 1994 Registration
Statement, the 1995 Registration Statement, the 1997 Registration Statement
or the Prospectus, including ordinary routine litigation incidental to the
business, are, considered in the aggregate, not material.
(iii) The information in the (a) 1994 Registration Statement
incorporated by reference from the Company's Annual Report on Form 10-K for
the year ended December 31, 1994 under the captions "Properties" and "Legal
Proceedings," (b) 1995 Registration Statement incorporated by reference
from the Company's Annual Report on Form 10-K for the year ended December
31, 1995 under the captions "Properties" and "Legal Proceedings," and (c)
the 1997 Registration Statement incorporated by reference from the
Company's Annual Report on Form 10-K for the year ended December 31, 1996
under the captions "Properties" and "Legal Proceedings," to the extent that
such information constitutes matters of law or legal conclusions, has been
reviewed by such counsel and is correct.
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(iv) The information in The 1994 Registration Statement
incorporated by reference from USLICO's Annual Report on Form 10-K for the
year ended December 31, 1993 under the captions "Properties" and "Legal
Proceedings," to the extent that it constitutes matters of law and legal
conclusions, has been reviewed by such counsel and, to the best of such
counsel's knowledge and information, is correct in all material respects.
(v) No default exists in the due performance or observance
of any material obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan agreement, note, deed of trust,
lease or other instrument described, referred to, filed with or
incorporated by reference in the 1994 Registration Statement, the 1995
Registration Statement or the 1997 Registration Statement, and, to the best
of such counsel's knowledge and information after due inquiry, there are no
contracts, indentures, mortgages, loan agreements, notes, deeds of trust,
leases or other instruments required to be described or referred to in the
1994 Registration Statement, the 1995 Registration Statement or the 1997
Registration Statement or to be filed as exhibits thereto other than those
described or referred to therein or filed or incorporated by reference as
exhibits thereto, and the descriptions thereof or references thereto are
correct in all material respects.
(vi) The execution and delivery of this Agreement, the
Pricing Agreement, the Declaration, the Preferred Securities Guarantee
Agreement, the Junior Subordinated Debt Securities and the Indenture and
the consummation of the transactions contemplated herein and therein will
not result in any violation of the provisions of the charter or by-laws of
the Company, nor will such action, to the best of such counsel's knowledge
after due inquiry, conflict with or constitute a breach of, or default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, any contract, indenture, mortgage, loan
agreement, note, deed of trust, lease or other instrument to which the
Company or any of its subsidiaries is a party or by which it or any of them
may be bound, or to which any of the property or assets of the Company or
any of its subsidiaries is subject, or any applicable law, administrative
regulation or administrative or court decree.
(vii) The Company and its subsidiaries are in compliance in
all material respects with, and conduct their respective businesses in
conformity in all material respects with, all applicable federal and state
laws and regulations.
(viii) This Agreement has been duly authorized, executed and
delivered by the Company.
(ix) Each of the 1994 Registration Statement, the 1995
Registration Statement and the 1997 Registration Statement is effective
under the 1933 Act and, to the best of such counsel's knowledge and
information, no stop order suspending the effectiveness of the 1994
Registration Statement, the 1995 Registration Statement or the 1997
Registration Statement has been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission.
(3) The favorable opinion, dated as of Closing Time, of
Richards, Layton & Finger, counsel of Wilmington Trust Company, as Property
Trustee under the Declaration, Trustee under the Indenture, and Guarantee
Trustee under the Preferred Securities Guarantee Agreement, in form and
substance satisfactory to counsel for the Underwriters, to the effect that:
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<PAGE>
(i) Wilmington Trust Company is duly incorporated and is
validly existing in good standing as a banking corporation under the laws
of the State of Delaware.
(ii) Wilmington Trust Company has the power and authority to
execute, deliver and perform its obligations under the Declaration, the
Indenture and the Preferred Securities Guarantee Agreement.
(iii) Each of the Declaration, the Indenture and the
Preferred Securities guarantee Agreement have been duly authorized,
executed and delivered by Wilmington Trust Company and constitutes a legal,
valid and binding obligation of Wilmington Trust Company, enforceable
against Wilmington Trust Company, in accordance with its terms.
(iv) The execution, delivery and performance by Wilmington
Trust Company of the Declaration, the Indenture and the Preferred
Securities Guarantee Agreement do not conflict with or constitute a breach
of the charter or by-laws of Wilmington Trust Company.
(v) No consent, approval or authorization of, or
registration with or notice to, any governmental authority or agency of the
State of Delaware or the United States of America governing the banking or
trust powers of Wilmington Trust Company is required for the execution,
delivery or performance by Wilmington Trust Company of the Declaration, the
Indenture and the Preferred Securities Guarantee Agreement.
(4) The favorable opinion, dated as of Closing Time, of
Richards, Layton & Finger, as special Delaware counsel for the Offerors, in form
and substance satisfactory to counsel for the Underwriters, to the effect that:
(i) The Trust has been duly created and is validly existing
in good standing as a business trust under the Delaware Act, and all
filings required as of the date hereof under the Delaware Act with respect
to the creation and valid existence of the Trust as a business trust have
been made.
(ii) Under the Declaration and the Delaware Act, the Trust
has the trust power and authority to own property and to conduct its
business, all as described in the Prospectus.
(iii) The Declaration constitutes a valid and binding
obligation of the Company and each of Wayne R. Huneke, Richard R. Crowl and
Wilmington Trust Company, and is enforceable against the Company and each
of the Trustees, in accordance with its terms.
(iv) Under the Declaration and the Delaware Act, the Trust
has the trust power and authority (i) to execute and deliver, and to
perform its obligations under, this Agreement and the Pricing Agreement,
and (ii) to issue, and to perform its obligations under, the Preferred
Securities and the Common Securities.
(v) Under the Declaration and the Delaware Act, the
execution and delivery by the Trust of this Agreement and the Pricing
Agreement, and the performance by the Trust of its obligations under this
Agreement and the Pricing Agreement, have been duly authorized by all
necessary trust action on the part of the Trust.
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(vi) Under the Delaware Act, the certificate attached to the
Declaration as Annex I is an appropriate form of certificate to evidence
ownership of the Preferred Securities. The Preferred Securities and the
Common Securities have been duly authorized by the Declaration and are duly
and validly issued and, subject to the qualifications hereinafter expressed
in this paragraph (vi), fully paid and nonassessable undivided beneficial
interests in the assets of the Trust. The respective holders of the
Preferred Securities and the Common Securities, as beneficial owners of the
Trust, will be entitled to the same limitation of personal liability
extended to stockholders of private corporations for profit organized under
the General Corporation Law of the State of Delaware. Such counsel may
note that the respective holders of the Preferred Securities and the Common
Securities may be obligated, pursuant to the Declaration, to make certain
payments under the Declaration.
(vii) Under the Declaration and the Delaware Act, the
issuance of the Preferred Securities and the Common Securities is not
subject to preemptive or similar rights.
(viii) The issuance and sale by the Trust of the Preferred
Securities and the Common Securities, the purchase by the Trust of the
Junior Subordinated Debt Securities, the execution, delivery and
performance by the Trust of this Agreement and the Pricing Agreement and
the Preferred Securities Guarantee Agreement, the consummation by the Trust
of the transactions contemplated by this Agreement and the Pricing
Agreement and compliance by the Trust with its obligations under this
Agreement and the Pricing Agreement do not violate (a) any of the
provisions of the Certificate of Trust or the Declaration, or (b) any
applicable Delaware law or Delaware administrative regulation.
(5) The favorable opinion, dated as of Closing Time, of
Sidley & Austin, counsel for the Underwriters, in form and substance
satisfactory to the Underwriters with respect to the Preferred Securities, the
Indenture, the Preferred Securities Guarantee Agreement, this Agreement, the
Pricing Agreement, the 1994 Registration Statement, the 1995 Registration
Statement, the 1997 Registration Statement, the Prospectus and other related
matters as the Representatives may require.
In giving its opinion, Sidley & Austin may rely as to certain matters
of Delaware law upon the opinion of Faegre & Benson LLP, counsel for the
Offerors, and Richards, Layton & Finger, special Delaware counsel for the
Offerors, which shall be delivered in accordance with Section 5(b)(1) and
Section 5(b)(4), respectively, hereof.
(c) Since the respective dates as of which information is given in
the 1994 Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement and the Prospectus, (i) there shall not have occurred a
material adverse change, or any development involving a prospective material
adverse change, in the condition, financial or otherwise, earnings, business
affairs, business properties, management, net worth or results of operations of
the Trust, or the Company and its subsidiaries taken as a whole, whether or not
arising from transactions in the ordinary course of business, in each case other
than as set forth in or contemplated by the Prospectus and (ii) neither the
Trust, the Company nor any of its subsidiaries shall have sustained any loss or
interference with its business or properties from fire, explosion, flood or
other casualty, whether or not covered by insurance, or from any labor dispute
or any court or legislative or other governmental action, order or decree, which
is not set forth in the 1994 Registration Statement, the 1995 Registration
Statement, the 1997 Registration Statement or the Prospectus and which is
material to the Trust or the Company and its subsidiaries taken as a whole, if
in the judgment of the Representatives any such development makes it
impracticable or inadvisable to
22
<PAGE>
consummate the sale and delivery of the Preferred Securities by the Underwriters
at the initial public offering price.
(d) The representations and warranties of the Company and the Trust
contained in this Agreement shall be true and correct at and as of the Closing
Time as if made on and as of the Closing Time, and the Representatives shall
have received a certificate, dated as of the Closing Time and signed by the
chief executive officer and the chief financial officer of the Company (or such
other officers as are acceptable to the Representatives), and a certificate of
the Trustees of the Trust, dated as of the Closing Time, each to the effect set
forth in this Section 5(d) and in Sections 5(a), 5(c), 5(e) and 5(f) hereof.
(e) The Company and the Trust shall have performed or complied with
its respective agreements and satisfied all conditions which are required to be
performed or complied with by them hereunder at or prior to the Closing Time.
(f) Since the respective dates as of which information is given in
the 1994 Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement and the Prospectus, there shall have been no litigation
or other proceeding instituted against the Trust or the Company or any of its
subsidiaries or any of their respective officers or directors in their
capacities as such, before or by any federal, state or local court, commission,
regulatory body, administrative agency or other governmental body, domestic or
foreign, in which litigation or proceeding an unfavorable ruling, decision or
finding would reasonably be expected to have a Material Adverse Effect.
(g) The Representatives shall have received a letter addressed to the
Underwriters and dated the date hereof from Deloitte & Touche LLP, independent
certified public accountants, substantially in the forms heretofore approved by
the Representatives, confirming that they are independent accountants with
respect to the Company as required by the 1933 Act and the 1933 Act Regulations,
that the Trust is and will be treated as a consolidated subsidiary of the
Company pursuant to generally accepted accounting principles and with respect to
the financial and other statistical and numerical information contained in the
1994 Registration Statement, the 1995 Registration Statement, the 1997
Registration Statement and the Prospectus. At the Closing Time, Deloitte &
Touche LLP shall have furnished to the Representatives a letter, dated the date
of its delivery, which shall confirm, on the basis of a review in accordance
with the procedures set forth in the letter from Deloitte & Touche LLP delivered
on the date hereof, that nothing has come to their attention during the period
from the date of the letter referred to in the prior sentence to a date
(specified in the letter) not more than five days prior to the Closing Time
which would require any change in their letter delivered on the date hereof if
it were required to be dated and delivered at the Closing Time.
(h) At Closing Time, counsel for the Underwriters shall have been
furnished with such documents and opinions as they may require for the purpose
of enabling them to pass upon the issuance and sale of the Preferred Securities
as herein contemplated and related proceedings, or in order to evidence the
accuracy of any of the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken by the Offerors
in connection with the issuance and sale of the Preferred Securities as herein
contemplated shall be satisfactory in form and substance to the Representatives
and Sidley & Austin, counsel for the Underwriters.
(i) At Closing Time, the Preferred Securities and the Junior
Subordinated Debt Securities shall be rated in one of the four highest rating
categories for long term debt ("Investment Grade") by any nationally recognized
statistical rating agency, and the Trust shall have delivered to the
Representatives a letter, dated the Closing Time, from such nationally
recognized statistical rating agency, or other evidence satisfactory to the
Representatives, confirming that the Preferred Securities and the Junior
Subordinated
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Debt Securities have Investment Grade ratings; and there shall not have occurred
any decrease in the ratings of any of the debt securities of the Company,
including the Junior Subordinated Debt Securities, or of the preferred stock of
the Company, including the Preferred Securities, by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g) under
the Act) and such organization shall not have publicly announced that it has
under surveillance or review, with possible negative implications, its rating of
any of the debt securities of the Company, including the Junior Subordinated
Debt Securities, or of the preferred stock of the Company, including the
Preferred Securities.
(j) At the Closing Time, the Preferred Securities shall have been
approved for listing on the New York Stock Exchange upon notice of issuance.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Representatives by notice to the Offerors at any time at or prior to
Closing Time, and such termination shall be without liability of any party to
any other party except as provided in Section 4 hereof; provided, however, that
Sections 1, 6, 7 and 8 shall survive such termination and remain in full force
and effect.
Section 6. Indemnification.
---------------
(a) The Offerors will indemnify and hold harmless each Underwriter,
the directors, officers, employees and agents of each Underwriter and each
person, if any, who controls each Underwriter within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act, from and against any and all
losses, claims, liabilities, expenses and damages (including any and all
investigative, legal and other expenses reasonably incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding or any
claim asserted), as incurred, to which they, or any of them, may become subject
under the 1933 Act, the 1934 Act or other Federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims,
liabilities, expenses or damages arise out of or are based on any untrue
statement or alleged untrue statement of a material fact contained in any
preliminary prospectus relating to the Preferred Securities, the 1994
Registration Statement, the 1995 Registration Statement, the 1997 Registration
Statement or the Prospectus or any amendment or supplement to the 1994
Registration Statement, the 1995 Registration Statement, the 1997 Registration
Statement or the Prospectus or in any documents filed under the 1934 Act and
incorporated by reference into the Prospectus (when read together with the
Prospectus), or the omission or alleged omission to state in such document a
material fact required to be stated in it or necessary to make the statements in
it not misleading, provided that the Offerors will not be liable to the extent
that such loss, claim, liability, expense or damage arises from the sale of the
Preferred Securities in the public offering to any person by such Underwriter
and is based on an untrue statement or omission or alleged untrue statement or
omission made in reliance on and in conformity with information relating to such
Underwriter furnished in writing to the Offerors by such Underwriter expressly
for inclusion in the 1994 Registration Statement, the 1995 Registration
Statement, the 1997 Registration Statement, any preliminary prospectus relating
to the Preferred Securities or the Prospectus, and provided further that the
Offerors will not be liable to any Underwriter (or any person controlling such
Underwriter) from whom the person asserting any such loss, claim, liability,
expense or damage purchased the Preferred Securities which are the subject
thereof if the Offerors shall have sustained the burden of proving that such
person did not receive from such Underwriter a copy of the Prospectus (or the
Prospectus as amended or supplemented, excluding documents incorporated by
reference therein), if the Offerors shall have previously furnished copies
thereof to such Underwriter in accordance with this Agreement, at or prior to
the confirmation of the sale of such Preferred Securities to such person in any
case where such delivery is required by the 1933 Act and the untrue statement or
omission of a material fact contained in the preliminary prospectus (or the
Prospectus) was corrected in the Prospectus (or the Prospectus as amended
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or supplemented). This indemnity agreement will be in addition to any liability
that the Offerors might otherwise have.
(b) The Company agrees to indemnify the Trust against all loss,
liability, claim, damage and expense whatsoever, which may become due from the
Trust under Section 6(a) hereof.
(c) Each Underwriter will indemnify and hold harmless the Offerors,
each person, if any, who controls the Offerors within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act, each of their directors or
trustees and each of their officers who signed the 1994 Registration Statement,
the 1995 Registration Statement or the 1997 Registration Statement to the same
extent as the foregoing indemnity from the Offerors to each Underwriter, but
only insofar as losses, claims, liabilities, expenses or damages arise out of or
are based on any untrue statement or omission or alleged untrue statement or
omission made in reliance on and in conformity with information relating to such
Underwriter furnished in writing to the Offerors by such Underwriter expressly
for use in the 1994 Registration Statement, the 1995 Registration Statement, the
1997 Registration Statement, any preliminary prospectus relating to the
Preferred Securities or the Prospectus. This indemnity will be in addition to
any liability that each Underwriter might otherwise have.
(d) Any party that proposes to assert the right to be indemnified
under this Section 6 will, promptly after receipt of notice of commencement of
any action against such party in respect of which a claim is to be made against
an indemnifying party or parties under this Section 6, notify each such
indemnifying party of the commencement of such action, enclosing a copy of all
papers served, but the omission so to notify such indemnifying party will not
relieve it from any liability that it may have to any indemnified party under
the foregoing provisions of this Section 6 unless, and only to the extent that,
such omission results in the forfeiture of or substantial prejudice to
substantive rights or defenses by the indemnifying party. In the case of
parties indemnified pursuant to Sections 6(a) and 6(b) above, counsel to the
indemnified parties shall be selected by Merrill Lynch, and, in the case of
parties indemnified pursuant to Section 6(c) above, counsel to the indemnified
parties shall be selected by the Company. An indemnifying party may participate
at its own expense in the defense of any such action; provided, however, that
counsel to the indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. It is understood
that the indemnifying party or parties shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees, disbursements and other charges of more than one separate firm
at any one time (plus local counsel) for all such indemnified party or parties.
All such fees, disbursements and other charges will be reimbursed by the
indemnifying party promptly as they are incurred. Except as provided in Section
6(f), an indemnifying party will not be liable for any settlement of any action
or claim effected without its written consent (which consent will not be
unreasonably withheld).
(e) No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or could
have been a party and indemnity has or could have been sought hereunder by such
indemnified party, unless such settlement (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, culpability or a failure to act by or on behalf
of any indemnified party.
(f) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 6(a) effected without its
written
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consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
Section 7. Contribution. In order to provide for just and equitable
------------
contribution in circumstances in which the indemnification provided for in
Section 6 is applicable in accordance with its terms but for any reason is held
to be unavailable from the Offerors or the Underwriters, the Offerors and the
Underwriters will contribute to the total losses, claims, liabilities, expenses
and damages (including any investigative, legal and other expenses reasonably
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claim asserted, but after deducting any contribution
received by the Offerors from persons other than the Underwriters, such as
persons who control the Offerors within the meaning of the 1933 Act, officers of
the Offerors who signed the 1994 Registration Statement, the 1995 Registration
Statement or the 1997 Registration Statement and directors or trustees of the
Offerors, who also may be liable for contribution) to which the Offerors and any
one or more of the Underwriters may be subject in such proportion as shall be
appropriate to reflect the relative benefits received by the Offerors on the one
hand and the Underwriters on the other. The relative benefits received by the
Offerors 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 Offerors bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in note (3) of the table on the cover page of the Prospectus. If, but
only if, the allocation provided by the foregoing sentence is not permitted by
applicable law, the allocation of contribution shall be made in such proportion
as is appropriate to reflect not only the relative benefits referred to in the
foregoing sentence but also the relative fault of the Offerors, on the one hand,
and the Underwriters, on the other, with respect to the statements or omissions
which resulted in such loss, claim, liability, expense or damage, or action in
respect thereof, as well as any other relevant considerations with respect to
such offering. Such relative fault shall be determined by reference to whether
the untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Offerors or the Underwriters, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Offerors and the Underwriters agree that it would
not be just and equitable if contribution pursuant to this Section 7 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
taken into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a result of the loss, claim,
liability, expense or damage, or action in respect thereof, referred to above in
this Section 7 shall be deemed to include, for purpose of this Section 7, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the underwriting commissions
received by it, and no person found guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) will be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Section 7 are several in proportion to their respective underwriting
obligations and not joint. For purposes of this Section 7, any person who
controls a party to this Agreement within the meaning of the 1933 Act will have
the same rights to contribution as that party, and each officer of the Offerors
who signed the 1994 Registration Statement, the 1995 Registration Statement or
the 1997 Registration Statement will have the same rights to contribution as the
Offerors, subject in each case to the provisions hereof. Any party entitled to
contribution, promptly after receipt of notice of commencement of any action
against such party in respect of which a claim for contribution may be made
under this Section 7, will notify any such party or parties
26
<PAGE>
from whom contribution may be sought, but the omission so to notify will not
relieve the party or parties from whom contribution may be sought from any other
obligation it or they may have under this Section 7. No party will be liable for
contribution with respect to any action or claim settled without its written
consent (which consent will not be unreasonably withheld). The Company shall be
jointly and severally liable for all contributions which the Trust may be
required to make hereunder.
Section 8. Representations, Warranties and Agreements to Survive.
-----------------------------------------------------
The indemnity agreements contained in Section 6 hereof and contribution
agreements contained in Section 7 hereof and all representations, warranties and
agreements contained in this Agreement and the Pricing Agreement, or contained
in certificates of officers or trustees of the Offerors submitted pursuant
hereto, shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or controlling person, or
by or on behalf of the Offerors and shall survive delivery of the Preferred
Securities to the Underwriters. In addition, such indemnity and contribution
agreements contained in Sections 6 and 7 shall survive any termination of this
Agreement.
Section 9. Termination of Agreement. (a) This Agreement shall be
------------------------
subject to termination in the absolute discretion of the Representatives,
without liability on the part of any Underwriter to the Offerors by notice to
the Offerors, if prior to the Closing Time or each Date of Delivery, if any, as
the case may be, (i) there has been, since the time of execution of this
Agreement or since the respective dates as of which information is given in the
Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, (ii) trading in any of the
securities of the Company shall have been suspended or materially limited by the
Commission or the New York Stock Exchange, (iii) trading in securities generally
on the New York Stock Exchange, the American Stock Exchange or the Nasdaq
National Market shall have been suspended or limited or minimum or maximum
prices shall have been generally established on such exchange or such system, or
additional material governmental restrictions, not in force on the date of this
Agreement, shall have been imposed upon trading in securities generally by such
exchange or such system or by order of the Commission or any court or other
governmental authority, (iv) a general banking moratorium in New York or
Minnesota shall have been declared by either federal or state authorities, (v)
any material adverse change in the financial or securities markets in the United
States or in political, financial or economic conditions in the United States or
any outbreak or material escalation of hostilities or declaration by the United
States of a national emergency or war or other calamity or crisis shall have
occurred the effect of any of which is such as to make it, in the sole judgment
of the Representatives, impracticable or inadvisable to market the Preferred
Securities on the terms and in the manner contemplated by the Prospectus or to
enforce contracts for the resale of the Preferred Securities by the
Underwriters, or (vi) there shall have occurred any decrease in the ratings of
any of the debt securities of the Company, including the Junior Subordinated
Debt Securities, or of the preferred stock of the Company, including the
Preferred Securities, by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the 1933 Act) or
such organization shall have publicly announced that it has under surveillance
or review, with possible negative implications, its rating of any of the debt
securities of the Company, including the Junior Subordinated Debt Securities, or
of the preferred stock of the Company, including of the Preferred Securities.
Notice of such termination may be given to the Offerors by telegram, telecopy or
telephone and shall be subsequently confirmed by letter.
(b) If the Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party except as
provided in Section 4 hereof, and provided further that Sections 1, 6, 7 and 8
shall survive such termination and remain in full force and effect.
27
<PAGE>
Section 10. Default by One or More of the Underwriters. If one or
------------------------------------------
more of the Underwriters shall fail at the Closing Time to purchase the
Preferred Securities that it or they are obligated to purchase under this
Agreement and the Pricing Agreement (the "Defaulted Securities"), the
Representatives shall have the right, within 48 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth; if, however, the Representatives shall not have completed such
arrangements within such 48-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of Preferred Securities, each of the non-defaulting Underwriters shall be
obligated, severally and not jointly, to purchase the full amount thereof in the
proportions that their respective underwriting obligations hereunder bear to the
underwriting obligations of all nondefaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number
of Preferred Securities, this Agreement shall terminate without liability on the
part of any nondefaulting Underwriter.
In the event of any such default which does not result in a termination of
this Agreement, either the Representatives or the Offerors shall have the right
to postpone the Closing Time for a period not exceeding ten days in order to
effect any required changes in the 1994 Registration Statement, the 1995
Registration Statement, the 1997 Registration Statement or the Prospectus or in
any other documents or arrangements. No action taken pursuant to this Section 10
shall relieve any defaulting Underwriter from liability in respect of its
default.
Section 11. Notices. All notices and other communications hereunder
-------
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication provided such
telecommunication is confirmed by recipient. Notices to the Underwriters shall
be directed to the Representatives at Merrill Lynch World Headquarters, North
Tower, World Financial Center, New York, New York 10281-1201, attention of
General Counsel; notices to the Trust, and the Company shall be directed to them
at 20 Washington Avenue South, Minneapolis, Minnesota 55401, attention of
General Counsel.
Section 12. Parties. This Agreement and the Pricing Agreement shall
-------
each inure to the benefit of and be binding upon the Underwriters and the Trust,
the Company and their respective successors. Nothing expressed or men tioned in
this Agreement or the Pricing Agreement is intended or shall be construed to
give any person, firm or corporation, other than the Underwriters and the Trust
and the Company and their respective successors and the controlling persons and
officers, directors and trustees referred to in Sections 6 and 7 and their heirs
and legal Representatives, any legal or equitable right, remedy or claim under
or in respect of this Agreement or the Pricing Agreement or any provision herein
or therein contained. This Agreement and the Pricing Agreement and all
conditions and provisions hereof and thereof are intended to be for the sole and
exclusive benefit of the Underwriters and the Trust and the Company and their
respective successors, and said controlling persons and officers, directors and
trustees and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Securities from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
Section 13. Governing Law and Time. This Agreement and the Pricing
----------------------
Agreement shall be governed by and construed in accordance with the laws of the
State of New York applicable to agreements made and to be performed in said
State. Except as otherwise set forth herein, specified times of day refer to
New York City time.
28
<PAGE>
Section 14. Counterparts. This Agreement may be executed by any one
------------
or more of the parties hereto in any number of counterparts, each of which shall
be deemed to be an original, but all such respective counterparts shall together
constitute one and the same instrument.
29
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Trust a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Underwriters and the Trust and the Company in accordance with its
terms.
Very truly yours,
RELIASTAR FINANCIAL CORP.
By /s/ Richard R. Crowl
---------------------
Title:
RELIASTAR FINANCING II
By /s/ Richard R. Crowl
---------------------
Title: Trustee
By /s/ Wayne R. Huneke
---------------------
Title: Trustee
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
DAIN BOSWORTH INCORPORATED
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
THE ROBINSON-HUMPHREY COMPANY, INC.
SMITH BARNEY INC.
By: MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By /s/ Ethan P. Stambler
-----------------------
Authorized Signatory
Acting on its own behalf and as Representatives of the other
Underwriters named in Schedule A hereto.
<PAGE>
SCHEDULE A
Number of
Name of Underwriter Preferred Securities
- -------------------- --------------------
Merrill Lynch, Pierce, Fenner & Smith Incorporated............890,000
Dain Bosworth Incorporated....................................890,000
Donaldson, Lufkin & Jenrette Securities Corporation...........890,000
The Robinson-Humphrey Company, Inc............................890,000
Smith Barney Inc..............................................890,000
Alex. Brown & Sons Incorporated................................50,000
Cowen & Company................................................50,000
A.G. Edwards & Sons, Inc.......................................50,000
EVEREN Securities, Inc.........................................50,000
Legg Mason Wood Walker, Incorporated...........................50,000
J.P. Morgan Securities, Inc....................................50,000
Oppenheimer & Co., Inc.........................................50,000
Piper Jaffray Inc..............................................50,000
Prudential Securities Incorporated.............................50,000
Tucker Anthony Incorporated....................................50,000
Wheat, First Securities, Inc...................................50,000
Total . . . . . . . . . . . .
5,000,000
31
<PAGE>
5,000,000 Preferred Securities
RELIASTAR FINANCING II
(a Delaware business trust)
8.10% Trust Originated Preferred Securities ("TOPrS")
(Liquidation Amount of $25 Per Security)
PRICING AGREEMENT
-----------------
May 29, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
DAIN BOSWORTH INCORPORATED
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
THE ROBINSON-HUMPHREY COMPANY, INC.
SMITH BARNEY INC.
as Representatives of the several
Underwriters named in the within-
mentioned Underwriting Agreement
c/o MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281
Ladies and Gentlemen:
Reference is made to the Underwriting Agreement, dated May 29,
1997 (the "Underwriting Agreement"), relating to the purchase by the several
Underwriters named in Schedule A thereto, for whom Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Donaldson, Lufkin & Jenrette
Securities Corporation, Dain Bosworth Incorporated, The Robinson-Humphrey
Company, Inc. and Smith Barney Inc. are acting as Representatives (the
"Representatives"), of the above 8.10% Trust Originated Preferred Securities
(the "Preferred Securities"), of RELIASTAR FINANCING II, a Delaware business
trust (the "Trust").
Pursuant to Section 2 of the Underwriting Agreement, the Trust,
ReliaStar Financial Corp. (the "Company"), a Delaware corporation, agree with
each Underwriter as follows:
1. The initial public offering price per security for the
Preferred Securities, determined as provided in said Section 2, shall be
$25.00.
2. The purchase price per security for the Preferred
Securities to be paid by the several Underwriters shall be $25.00, being
an amount equal to the initial public offering price set forth above.
<PAGE>
3. The compensation per Preferred Security to be paid by
the Company to the several Under writers in respect of their commitments
hereunder shall be $.7875.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Trust a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the Underwriters, the Trust and the Company in accordance with its terms.
Very truly yours,
RELIASTAR FINANCIAL CORP.
By /s/ Richard R. Crowl
---------------------
Title:
RELIASTAR FINANCING II
By /s/ Richard R. Crowl
---------------------
Title: Trustee
By /s/ Wayne R. Huneke
--------------------
Title: Trustee
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
DAIN BOSWORTH INCORPORATED
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
THE ROBINSON-HUMPHREY COMPANY, INC.
SMITH BARNEY INCORPORATED
By: MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By /s/ Ethan P. Stambler
------------------------------------
Authorized Signatory
Acting on its own behalf and as Representatives of the other Underwriters named
in Schedule A to the Underwriting Agreement.
<PAGE>
EXHIBIT 4(8)
================================================================================
AMENDED AND RESTATED
DECLARATION OF TRUST
RELIASTAR FINANCING II
Dated as of June 3, 1997
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
ARTICLE I
INTERPRETATION AND DEFINITIONS
<S> <C>
Section 1.1 Interpretations and Definitions................................ 2
ARTICLE II
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application............................... 8
Section 2.2 Lists of Holders of Trust Securities........................... 9
Section 2.3 Reports by the Property Trustee................................ 9
Section 2.4 Periodic Reports to Property Trustee........................... 9
Section 2.5 Evidence of Compliance with Conditions Precedent............... 9
Section 2.6 Events of Default; Waiver...................................... 10
Section 2.7 Event of Default; Notice....................................... 11
ARTICLE III
ORGANIZATION
Section 3.1 Name........................................................... 12
Section 3.2 Office......................................................... 12
Section 3.3 Purpose........................................................ 12
Section 3.4 Authority...................................................... 12
Section 3.5 Title to Property of the Trust................................. 13
Section 3.6 Powers and Duties of the Regular Trustees...................... 13
Section 3.7 Prohibition of Actions by the Trust and the Trustees........... 16
Section 3.8 Powers and Duties of the Property Trustee...................... 16
Section 3.9 Certain Duties and Responsibilities of the Property Trustee.... 18
Section 3.10 Certain Rights of Property 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 Trust Securities.. 22
Section 3.14 Duration of Trust............................................. 22
Section 3.15 Mergers....................................................... 22
ARTICLE IV
SPONSOR
Section 4.1 Sponsor's Purchase of Common Securities........................ 24
Section 4.2 Responsibilities of the Sponsor................................ 24
</TABLE>
<PAGE>
ARTICLE V
TRUSTEES
<TABLE>
<S> <C>
Section 5.1 Number of Trustees................................................. 25
Section 5.2 Delaware Trustee................................................... 25
Section 5.3 Property Trustee; Eligibility...................................... 26
Section 5.4 Qualifications of Regular Trustees and Delaware Trustee Generally.. 26
Section 5.5 Initial Regular Trustees........................................... 27
Section 5.6 Appointment, Removal and Resignation of Trustees................... 27
Section 5.7 Vacancies Among Trustees........................................... 29
Section 5.8 Effect of Vacancies................................................ 29
Section 5.9 Meetings........................................................... 29
Section 5.10 Delegation of Power............................................... 29
Section 5.11 Merger, Conversion, Consolidation or Succession to Business....... 30
ARTICLE VI
DISTRIBUTIONS
Section 6.1 Distributions...................................................... 30
ARTICLE VII
TRUST SECURITIES
Section 7.1 General Provisions Regarding Trust Securities...................... 31
Section 7.2 Paying Agent....................................................... 32
ARTICLE VIII
TERMINATION
Section 8.1 Termination of Trust............................................... 32
ARTICLE IX
TRANSFER OF INTEREST
Section 9.1 Transfer of Trust Securities....................................... 33
Section 9.2 Transfer of Certificates........................................... 33
Section 9.3 Deemed Trust Security Holders...................................... 34
Section 9.4 Book Entry Interests............................................... 34
Section 9.5 Notices to Depositary.............................................. 35
Section 9.6 Appointment of Successor Depositary................................ 35
Section 9.7 Definitive Preferred Security Certificates......................... 35
Section 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.................. 36
</TABLE>
ii
<PAGE>
ARTICLE X
LIMITATION OF LIABILITY OF HOLDERS OF TRUST
SECURITIES, TRUSTEES OR OTHERS
<TABLE>
<S> <C>
Section 10.1 Liability.......................................................... 36
Section 10.2 Exculpation........................................................ 37
Section 10.3 Fiduciary Duty..................................................... 37
Section 10.4 Indemnification.................................................... 38
Section 10.5 Outside Businesses................................................. 41
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......................................................... 43
Section 12.2 Meetings of the Holders of Trust Securities; Action by Written
Consent........................................................... 45
ARTICLE XIII
REPRESENTATIONS AND WARRANTIES OF PROPERTY
TRUSTEE AND DELAWARE TRUSTEE
Section 13.1 Representations and Warranties of Property Trustee................. 47
Section 13.2 Representations and Warranties of Delaware Trustee................. 47
ARTICLE XIV
MISCELLANEOUS
Section 14.1 Notices............................................................ 48
Section 14.2 Governing Law...................................................... 50
Section 14.3 Intention of the Parties........................................... 50
Section 14.4 Headings........................................................... 50
Section 14.5 Successors and Assigns............................................. 50
Section 14.6 Partial Enforceability............................................. 50
Section 14.7 Counterparts....................................................... 50
</TABLE>
iii
<PAGE>
EXHIBIT A -- Terms of 8.10% Trust Originated Preferred Securities;
8.10% Trust Originated Common Securities
ANNEX I -- Form of Preferred Securities Certificate
ANNEX II -- Form of Common Securities Certificate
EXHIBIT B -- Underwriting Agreement
iv
<PAGE>
AMENDED AND RESTATED
DECLARATION OF TRUST
THIS AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration"), dated
and effective as of June 3, 1997, by the undersigned trustees (together with all
other Persons from time to time duly appointed and serving as trustees in
accordance with the provisions of this Declaration, the "Regular Trustees"),
ReliaStar Financial Corp., a Delaware corporation, as trust sponsor (the
"Sponsor"), Wilmington Trust Company, a Delaware banking corporation, as
property trustee (the "Property Trustee") and by the holders, from time to time,
of undivided beneficial interests in the Trust to be issued pursuant to this
Declaration.
RECITALS
WHEREAS, the Sponsor, the Regular Trustees and the Property Trustee
established a trust (the "Trust") under the Business Trust Act pursuant to a
Declaration of Trust dated as of May 8, 1997 (the "Original Declaration") and a
Certificate of Trust of the Trust (the "Certificate of Trust"), which was filed
with the Secretary of State on May 8, 1997 pursuant to Section 3810 of the
Business Trust Act, 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 Notes (as hereinafter
defined) of the Note Issuer (as hereinafter defined);
WHEREAS, as of the date hereof, no interests in the Trust have been
issued;
WHEREAS, it being the intention of the parties hereto that the
Original Declaration be amended and restated in its entirety; 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 constitutes the governing instrument of such business trust,
the Trustees declare that all assets contributed to, or otherwise obtained by,
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.
<PAGE>
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 INTERPRETATIONS AND DEFINITIONS.
In this Declaration, 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;
(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, Sections, Exhibits and
Annexes are to Articles, Sections of, Exhibits to and Annexes of this
Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act (as hereinafter defined) 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 Depositary as described in Section 9.4.
"Business Day" means any day other than a day on which banking institutions
in New York, New York, Wilmington, Delaware or Minneapolis, Minnesota are
authorized or required by law to close.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware Code, 12
Del. Code Section 3801 et seq., as it may be amended from time to time or any
successor legislation.
"Certificate" means a Common Security Certificate or a Preferred Security
Certificate.
2
<PAGE>
"Certificate of Trust" means the Certificate of Trust filed with the
Secretary of State pursuant to Section 3810 of the Business Trust Act.
"Closing Date" means June 3, 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, as from time to
time constituted, created under the Exchange Act or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common 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
Annex II to Exhibit A.
"Company Indemnified Person" means (a) any Regular Trustee; (b) any
Affiliate of any Regular Trustee; (c) any officer, director, shareholder,
member, partner, employee, representative or agent of any Regular Trustee; or
(d) any officer, employee or agent of the Trust or its Affiliates.
"Corporate Trust Office" means the principal office of the Property
Trustee, at which at any particular time its corporate trust business shall be
administered which office at the date of execution of this Declaration is
located at Wilmington Trust Company, Rodney Square North, 1100 North Market
Street, Wilmington, Delaware 19890-0001 Attn: Corporate Trust Administration.
"Coupon Rate" has the meaning set forth in Exhibit A.
"Covered Person" means: (a) any officer, director, shareholder, partner,
member, representative, employee or agent of (i) the Trust or (ii) the Trust's
Affiliates; and (b) any Holder of Trust Securities.
"Declaration" has the meaning set forth in the preamble.
"Deferred Interest" has the meaning set forth in the Indenture.
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Definitive Preferred Security Certificates" has the meaning set forth in
Section 9.4.
"Depositary" means an organization registered as a clearing agency pursuant
to Section 17A of the Exchange Act that is acting as depositary for the
Preferred Securities and in whose name or in the name of a nominee of that
organization shall be registered a
3
<PAGE>
Global Certificate and which shall undertake to effect book entry transfers and
pledges of the Preferred Securities.
"Depositary Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Depositary effects
book entry transfers and pledges of securities deposited with the Depositary.
"Direction" by a Person means a written direction signed:
(a) if the Person is a natural person, by that Person; or
(b) in any other case, in the name of such Person by one or more
Authorized Officers of that Person.
"Dissolution Tax Opinion" has the meaning set forth in Exhibit A.
"Distribution" means a distribution payable to Holders of Trust Securities
in accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial Depositary.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, or any successor legislation.
"Extension Period" has the meaning set forth in Exhibit A.
"Event of Default," in respect of the Trust Securities, means an Event of
Default (as defined in the Indenture) has occurred and is continuing in respect
of the Notes.
"Fiduciary Indemnified Person" has the meaning set forth in Section
10.4(b).
"Fiscal Year" has the meaning set forth in Section 11.1.
"Global Certificate" has the meaning specified in Section 9.4.
"Holder" means a Person in whose name a Certificate representing a Trust
Security is registered on the books and records of the Trust, such Person being
a beneficial owner within the meaning of the Business Trust Act, provided, that,
in determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Sponsor, as guarantor of the Trust Securities, or any
Affiliate of the Sponsor.
"Indemnified Person" means a Company Indemnified Person or a Fiduciary
Indemnified Person.
"Indenture" means the Indenture dated as of March 29, 1996 between the Note
Issuer and the Note Trustee as supplemented by the First Supplemental Indenture
dated as
4
<PAGE>
of March 29, 1996, and the Second Supplemental Indenture dated as of June 3,
1997 and any other indenture supplemental thereto.
"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.
"Legal Action" has the meaning set forth in Section 3.6(g).
"Liquidation Distribution" has the meaning set forth in Exhibit A.
"List of Holders" has the meaning set forth in Section 2.2(a).
"Ministerial Action" has the meaning set forth in Exhibit A.
"Majority in liquidation amount" means, except as provided in the terms of
the Trust Securities and the Trust Indenture Act, Holder(s) of outstanding Trust
Securities voting together as a single class or, as the context may require,
Holder(s) of outstanding Preferred Securities or Holder(s) of outstanding Common
Securities voting separately as a class, who are the record owners of 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 Trust Securities of the relevant class.
"90 Day Period" has the meaning set forth in Exhibit A.
"No Recognition Opinion" has the meaning set forth in Exhibit A.
"Note Issuer" means the Sponsor in its capacity as issuer of the Notes.
"Note Trustee" means Wilmington Trust Company, not in its individual
capacity but solely as trustee under the Indenture until a successor is
appointed thereunder, and thereafter means such successor trustee.
"Notes" means the series of Notes to be issued by the Note Issuer under the
Indenture to be held by the Property Trustee.
"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 Certificate has read the
covenant or condition and the definition relating thereto;
5
<PAGE>
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the 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.
"Original Declaration" has the meaning set forth in the preamble.
"Paying Agent" has the meaning specified in Section 7.2.
"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, limited liability partnership, 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 to be dated
as of June 3, 1997, 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 Depositary, or on the books of a Person
maintaining an account with such Depositary (directly as a Depositary
Participant or as an indirect participant, in each case in accordance with the
rules of such Depositary).
"Preferred Security Certificate" means a certificate representing a
Preferred Security substantially in the form of Annex I to Exhibit A.
"Pricing Agreement" means the pricing agreement between the Trust, the Note
Issuer, and the underwriters designated by the Regular Trustees with respect to
the offer and sale of the Preferred Securities.
"Pro Rata" has the meaning set forth in Exhibit A.
"Property Trustee" means Wilmington Trust Company, a Delaware banking
corporation, in its capacity as property trustee, or any successor trustee
meeting the eligibility requirements set forth in Section 5.3.
"Property Trustee Account" has the meaning set forth in Section 3.8(c).
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"Prospectus Supplement" means that certain Prospectus Supplement dated as
of May 29, 1997 relating to the Preferred Securities.
"Quorum" means a majority of the Regular Trustees or, if there are only two
Regular Trustees, both of them.
"Redemption/Distribution Notice" has the meaning set forth in Exhibit A.
"Redemption Price" has the meaning set forth in Exhibit A.
"Redemption Tax Opinion" has the meaning set forth in Exhibit A.
"Regular Trustee" means any Trustee other than the Delaware Trustee and the
Property Trustee.
"Related Party" means, with respect to the Sponsor, any direct or indirect
wholly owned subsidiary of the Sponsor or any other Person that owns, directly
or indirectly, 100% of the outstanding voting securities of the Sponsor.
"Responsible Officer" means, with respect to the Property Trustee, any vice
president, any assistant vice president, the secretary, any assistant secretary,
the treasurer, any assistant treasurer, any trust officer or assistant trust
officer or any other officer in the Corporate Trust Office of the Property
Trustee customarily performing functions similar to those performed by any of
the above designated officers and 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.
"Secretary of State" means the Office of the Secretary of State of the
State of Delaware.
"Securities Act" means the Securities Act of 1933, as amended from time to
time, or any successor legislation.
"Sponsor" means ReliaStar Financial Corp., a Delaware corporation, 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(b)(ii).
"Successor Entity" has the meaning set forth in Section 3.15(b)(i).
"Successor Property Trustee" has the meaning set forth in Section
5.6(b)(i).
"Successor Securities" has the meaning set forth in Section 3.15(b)(i)(B).
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"Tax Event" has the meaning set forth in Exhibit A.
"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 in effect at
the date as of which this instrument was executed, provided, however, that in
the event the Trust Indenture Act is amended after such date, "Trust Indenture
Act" means, to the extent required by any such amendment, the Trust Indenture
Act of 1939 as so amended.
"Trust Securities" means collectively the Common Securities and the
Preferred Securities.
"Underwriting Agreement" means the Underwriting Agreement for the offering
and sale of the Preferred Securities attached hereto as Exhibit B.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 TRUST INDENTURE ACT; APPLICATION.
(a) This Declaration is subject to the provisions of the Trust Indenture
Act that are required to be part of this Declaration and shall, to the extent
applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a Trustee for
the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this Declaration limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such duties imposed by the Trust
Indenture Act shall control.
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(d) The application of the Trust Indenture Act to this Declaration shall
not affect the nature of the Trust Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
SECTION 2.2 LISTS OF HOLDERS OF TRUST SECURITIES.
(a) Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide the Property Trustee (i) within 14 days after each record date for
payment of Distributions, a list, in such form as the Property Trustee may
reasonably require, of the names and addresses of the Holders of the Trust
Securities ("List of Holders") as of such record date, provided that neither the
Sponsor nor any Regular Trustee on behalf of the Trust shall be obligated to
provide such list of Holders at any time the List of Holders does not differ
from the most recent List of Holders given to the Property Trustee by the
Sponsor and the Regular Trustees on behalf of the Trust, and (ii) at any other
time, within 30 days of receipt by the Trust of a written request for a List of
Holders as of a date no more than 14 days before such List of Holders is given
to the Property Trustee. The Property Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in Lists of Holders
given to it or which it receives in the capacity as Paying Agent (if acting in
such capacity), provided that the Property Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders
(b) The Property Trustee shall comply with the obligations of an indenture
trustee under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 REPORTS BY THE PROPERTY TRUSTEE.
Within 60 days after December 31 of each year, the Property Trustee shall
provide to the Holders of the Preferred Securities such reports as are required
by Section 313 of the Trust Indenture Act, if any, in the form and in the manner
provided by Section 313 of the Trust Indenture Act. The Property Trustee shall
also comply with the requirements of Section 313 (d) of the Trust Indenture Act.
SECTION 2.4 PERIODIC REPORTS TO PROPERTY TRUSTEE.
Each of the Sponsor and the Regular Trustees on behalf of the Trust shall
provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (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.
Each of the Sponsor and the Regular Trustees on behalf of the Trust shall
provide to the Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Declaration that relate to any of the
matters set forth in Section 314(c)
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of the Trust Indenture Act. Any certificate or opinion required to be given by
an officer pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
SECTION 2.6 EVENTS OF DEFAULT; WAIVER.
(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) requires the consent or vote of all of the holders of the Notes
to be waived under the Indenture, the Event of Default under the
Declaration may only be waived by the vote of all the Holders of the
Preferred Securities.
Upon such waiver, any such default shall cease to exist, and any Event of
Default with respect to the Preferred Securities arising therefrom shall be
deemed to have been cured, for every purpose of this Declaration, but no such
waiver shall extend to any subsequent or other default or an Event of Default
with respect to the Preferred Securities or impair any right consequent thereon.
Any waiver by the Holders of the Preferred Securities of an Event of Default
with respect to the Preferred Securities shall also be deemed to constitute a
waiver by the Holders of the Common Securities of any such Event of Default with
respect to the Common Securities for all purposes of this Declaration without
any further act, vote, or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in liquidation amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, except where the Holders
of the Common Securities are deemed to have waived such Event of Default
under the Declaration as provided below in this Section 2.6(b), the Event
of Default under the Declaration shall also not be waivable; or
(ii) requires the consent or vote of all of the holders of the Notes
to be waived, except where the Holders of the Common Securities are deemed
to have waived such Event of Default under the Declaration as provided
below in this Section 2.6(b), the Event of Default under the Declaration
may only be waived by the vote of all of the Holders of the Common
Securities;
provided that, each Holder of Common Securities will be deemed to have waived
any such Event of Default and all Events of Default with respect to the Common
Securities and its consequences until all Events of Default with respect to the
Preferred Securities have been
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cured, waived or otherwise eliminated, and until such Events of Default have
been so cured, waived or otherwise eliminated, the Property Trustee will be
deemed to be acting solely on behalf of the Holders of the Preferred Securities
and only the Holders of the Preferred Securities will have the right to direct
the Property Trustee in accordance with the terms of the Trust Securities.
Subject to the foregoing provisions of this Section 2.6(b), upon such waiver,
any such default shall cease to exist and any Event of Default with respect to
the Common Securities arising therefrom shall be deemed to have been cured for
every purpose of this Declaration but no such waiver shall extend to any
subsequent or other default or Event of Default with respect to the Common
Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the Property
Trustee at the direction of the Holders of the Preferred Securities constitutes
a waiver of the corresponding Event of Default under this Declaration.
SECTION 2.7 EVENT OF DEFAULT; NOTICE.
(a) The Property Trustee shall, within 90 days after the occurrence of an
Event of Default, transmit by mail, first class postage prepaid, to the Holders
of the Trust Securities, notices of all defaults with respect to the Trust
Securities known to the Property Trustee, unless such defaults have been cured
before the giving of such notice (the term "defaults" for the purposes of this
Section 2.7(a) being hereby defined to be an Event of Default as defined in the
Indenture, not including any periods of grace provided for therein and
irrespective of the giving of any notice provided therein); provided that,
except for a default in the payment of principal of (or premium, if any) or
interest on any of the Notes or in the payment of any sinking fund installment
established for the Notes, the Property Trustee shall be protected in
withholding such notice if and so long as Responsible Officers of the Property
Trustee in good faith determine that the withholding of such notice is in the
interests of the Holders of the Trust Securities.
(b) The Property Trustee shall not be deemed to have knowledge of any
default except:
(i) a default under Sections 501(1) and 501(2) of the Indenture; or
(ii) any default as to which a Responsible Officer of the Property
Trustee charged with the administration of the Declaration shall have
obtained written or actual notice.
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ARTICLE III
ORGANIZATION
SECTION 3.1 NAME.
The Trust formed hereby shall be a business trust established under the
Business Trust Act. The Trust is named "ReliaStar Financing II," as such name
may be modified from time to time by the Regular Trustees following written
notice to the Holders of Trust Securities. The Trust's activities may be
conducted under the name of the Trust or any other name deemed advisable by the
Regular Trustees.
SECTION 3.2 OFFICE.
The address of the principal office of the Trust is c/o ReliaStar Financial
Corp., 20 Washington Avenue South, Minneapolis, Minnesota 55401. On ten
Business Days written notice to the Holders of Trust Securities, the Regular
Trustees may designate another principal office.
SECTION 3.3 PURPOSE.
The exclusive purposes and functions of the Trust are (a) to issue and sell
Trust Securities and use the proceeds from such sale to acquire the Notes and
(b) except as otherwise limited herein, to engage in only those other activities
necessary or incident thereto. The Trust shall not borrow money, issue debt or
reinvest proceeds derived from investments, pledge any of its assets, or
otherwise undertake (or permit to be undertaken) any activity that would cause
the Trust not to be classified for United States federal income tax purposes as
a grantor trust. All provisions of this Declaration shall be interpreted in a
manner consistent with such purposes.
SECTION 3.4 AUTHORITY.
Subject to the limitations provided in this Declaration, including the
provisions of Sections 3.11, 5.2 and 8.1(b), and to the specific duties of the
Property Trustee, the Regular Trustees shall have exclusive and complete
authority to carry out the purposes of the Trust. An action taken by the
Regular Trustees in accordance with their powers shall constitute the act of and
serve to bind the Trust and an action taken by the Property Trustee in
accordance with its powers shall constitute the act of and serve to bind the
Trust. In dealing with the Regular Trustees acting on behalf of the Trust, no
Person shall be required to inquire into the authority of the Regular Trustees
to bind the Trust. Persons dealing with the Trust are entitled to rely
conclusively on the power and authority of the Trustees as set forth in this
Declaration.
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SECTION 3.5 TITLE TO PROPERTY OF THE TRUST.
Except as provided in Section 3.8 with respect to the Notes and the
Property Trustee Account or as otherwise provided in this Declaration, legal
title to all assets of the Trust shall be vested in the Trust. The Holders
shall not have legal title to any part of the assets of the Trust, but shall
have an undivided beneficial interest in the assets of the Trust.
SECTION 3.6 POWERS AND DUTIES OF THE REGULAR TRUSTEES.
The Regular Trustees shall have the exclusive power, duty and authority to
cause the Trust to engage in the following activities:
(a) to issue and sell the Preferred Securities and the Common Securities
in accordance with this Declaration; provided, however, that the Trust may issue
no more than one series of Preferred Securities and no more than one series of
Common Securities, and, provided further, that there shall be no interests in
the Trust other than the Trust Securities, and the issuance of Trust Securities
shall be limited to a one-time, simultaneous issuance of both Preferred
Securities and Common Securities on the Closing Date;
(b) in connection with the issuance and sale of the Preferred Securities,
at the direction of the Sponsor, to:
(i) execute and file with the Commission the registration statement
on Form S-3 prepared by the Sponsor, including any amendments thereto,
pertaining to 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 or 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 a registration statement on
Form 8-A, including any amendments thereto, prepared by the Sponsor
relating to the registration of the Preferred Securities under Section
12(b) of the Exchange Act; and
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(v) execute and enter into the Underwriting Agreement and Pricing
Agreement providing for the sale of the Preferred Securities and a
Subscription Agreement providing for the sale of the Common Securities;
(c) to acquire the Notes 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 Notes to be held of record in the name
of the Property Trustee for the benefit of the Holders of the Preferred
Securities and the Holders of the Common Securities;
(d) to give the Sponsor and the Property Trustee prompt written notice of
the occurrence of a Tax Event; provided that the Regular Trustees shall consult
with the Sponsor and the Property Trustee before taking or refraining from
taking any Ministerial Action in relation to a Tax 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 Section 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;
(f) to take all actions and perform such duties as may be required of the
Regular Trustees pursuant to the terms of the Trust 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 Property 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 Section 314(a)(4) of the Trust
Indenture Act to the Property Trustee, which certificate may be executed by a
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 Trust Securities;
(m) to give prompt written notice to the Holders of the Trust Securities
and the Property Trustee of any notice received from the Note Issuer of its
election (i) to defer
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payments of interest on the Notes by extending the interest payment period under
the Indenture or (ii) to extend the scheduled maturity date of the Notes;
(n) 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;
(o) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of the
State of Delaware and of each other jurisdiction in which such existence is
necessary to protect the limited liability of the Holders of the Trust
Securities or to enable the Trust to effect the purposes for which the Trust was
created;
(p) to take any action, not inconsistent with this Declaration or with
applicable law, that the Regular Trustees determine in their discretion to be
necessary or desirable in carrying out the activities of the Trust as set out in
this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an Investment Company
required to be registered under the Investment Company Act;
(ii) causing the Trust to be classified for United States federal
income tax purposes as a grantor trust; and
(iii) cooperating with the Note Issuer to ensure that the Notes will
be treated as indebtedness of the Note Issuer for United States federal
income tax purposes,
provided that such action does not adversely affect the interests of Holders;
and
(q) to take all action necessary to cause all applicable tax returns and
tax information reports that are required to be filed with respect to the Trust
to be duly prepared and filed by the Regular Trustees, on behalf of the Trust.
The Regular Trustees must exercise the powers set forth in this Section 3.6
in a manner that is consistent with the purposes and functions of the Trust set
out in Section 3.3, and the Regular Trustees shall not take any action that is
inconsistent with the purposes and functions of the Trust set forth in Section
3.3.
Subject to this Section 3.6, the Regular Trustees shall have none of the
powers or the authority of the Property Trustee set forth in Section 3.8.
Any expenses incurred by the Regular Trustees pursuant to this Section 3.6
shall be reimbursed by the Note Issuer.
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SECTION 3.7 PROHIBITION OF ACTIONS BY THE TRUST AND THE TRUSTEES.
(a) The Trust shall not, and the Trustees shall not, engage in any
activity other than as required or authorized by this Declaration. In
particular, the Trust shall not and the Trustees shall cause the Trust not to:
(i) invest any proceeds received by the Trust from holding the
Notes, but shall distribute all such proceeds to Holders of Trust
Securities pursuant to the terms of this Declaration and of the Trust
Securities;
(ii) acquire any assets other than as expressly provided herein;
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness other than loans
represented by the Notes;
(v) possess any power or otherwise act in such a way as to vary
the Trust assets or the terms of the Trust Securities in any way
whatsoever;
(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the Trust
Securities; or
(vii) other than as provided in this Declaration or Exhibit A
(A) direct the time, method and place of exercising any trust or power
conferred upon the Note Trustee with respect to the Notes, (B) waive any
past default that is waivable under Section 513 of the Indenture, (C)
exercise any right to rescind or annul any declaration that the principal
of all the Notes shall be due and payable or (D) consent to any amendment,
modification or termination of the Indenture or the Notes where such
consent shall be required unless the Trust shall have received an opinion
of counsel to the effect that such modification will not cause more than an
insubstantial risk that for United States federal income tax purposes the
Trust will not be classified as a grantor trust.
SECTION 3.8 POWERS AND DUTIES OF THE PROPERTY TRUSTEE.
(a) The legal title to the Notes shall be owned by and held of record in
the name of the Property Trustee in trust for the benefit of the Holders of the
Trust Securities. The right, title and interest of the Property Trustee to the
Notes shall vest automatically in each Person who may hereafter be appointed as
Property Trustee in accordance with Section 5.6. Such vesting shall be
effective whether or not conveyancing documents with regard to the Notes have
been executed and delivered.
(b) The Property Trustee shall not transfer its right, title and interest
in the Notes to the Regular Trustees or to the Delaware Trustee (if the Property
Trustee does not also act as Delaware Trustee).
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(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest bearing
trust account (the "Property Trustee Account") in the name of and under the
exclusive control of the Property Trustee on behalf of the Holders of the
Trust Securities and, upon the receipt of payments of funds made in respect
of the Notes held by the Property Trustee, deposit such funds into the
Property Trustee Account and make payments to the Holders of the Preferred
Securities and Holders of the Common Securities from the Property Trustee
Account in accordance with Section 6.1. Funds in the Property Trustee
Account shall be held uninvested until disbursed in accordance with this
Declaration. The Property Trustee Account shall be an account that is
maintained with a banking institution the rating on whose long term
unsecured indebtedness is at least equal to the rating assigned to the
Preferred Securities by a "nationally recognized statistical rating
organization," as that term is defined for purposes of Rule 436(g)(2) under
the Securities Act or shall be an account maintained in the Corporate Trust
Department of the Property Trustee;
(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 Notes are redeemed or mature; and
(iii) upon notice of distribution issued by the Regular Trustees
in accordance with the terms of the Trust Securities, engage in such
ministerial activities as shall be necessary or appropriate to effect the
distribution of the Notes to Holders of Trust Securities upon occurrence of
certain special events (as may be defined in the terms of the Trust
Securities) arising from a change in law or a change in legal
interpretation or other specified circumstances pursuant to the terms of
the Trust Securities.
(d) The Property Trustee shall take all actions and perform such duties as
may be specifically required of the Property Trustee pursuant to the terms of
the Trust Securities.
(e) The Property Trustee shall take any Legal Action which arises out of
or in connection with an Event of Default or the Property Trustee's duties and
obligations under this Declaration or the Trust Indenture Act.
(f) The Property Trustee shall not resign as a trustee of the Trust unless
either:
(i) the Trust has been completely liquidated and the proceeds of
the liquidation distributed to the Holders of Trust Securities pursuant to
the terms of the Trust Securities; or
(ii) a Successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 5.6.
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(g) The Property Trustee shall have the legal power to exercise all of the
rights, powers and privileges of a holder of Notes under the Indenture and, if
an Event of Default occurs and is continuing, the Property Trustee shall, for
the benefit of Holders of Trust Securities, enforce its rights as holder of the
Notes subject to the rights of the Holders pursuant to the terms of such Trust
Securities.
(h) Subject to this Section 3.8, the Property Trustee shall have none of
the duties, liabilities, powers or the authority of the Regular Trustees set
forth in Section 3.6.
The Property Trustee must exercise the powers set forth in this Section 3.8
in a manner that is consistent with the purposes and functions of the Trust set
out in Section 3.3, and the Property Trustee shall not take any action that is
inconsistent with the purposes and functions of the Trust set out in Section
3.3.
SECTION 3.9 CERTAIN DUTIES AND RESPONSIBILITIES OF THE PROPERTY TRUSTEE.
(a) The Property Trustee, before the occurrence of any Event of Default
and after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Declaration and no implied covenants shall be read into this Declaration against
the Property Trustee. In case an Event of Default has occurred (that has not
been cured or waived pursuant to Section 2.6), the Property Trustee shall
exercise such of the rights and powers vested in it by this Declaration, and use
the same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) No provision of this Declaration shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Property Trustee shall be
determined solely by the express provisions of this Declaration and
the Property Trustee shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this
Declaration, and no implied covenants or obligations shall be read
into this Declaration against the Property Trustee; and
(B) in the absence of bad faith on the part of the Property
Trustee, the Property Trustee may conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Property
Trustee and conforming to the requirements of this Declaration; but in
the case of any such certificates or opinions that by any provision
hereof are specifically required to be furnished to the Property
Trustee, the Property Trustee shall be under a duty to
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examine the same to determine whether or not they conform to the
requirements of this Declaration;
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Property
Trustee, unless it shall be proved that the Property Trustee was negligent
in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in
liquidation amount of the Trust Securities at the time outstanding relating
to the time, method and place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any trust or power
conferred upon the Property Trustee under this Declaration;
(iv) no provision of this Declaration shall require the Property
Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Declaration or adequate
indemnity against such risk or liability is not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the custody,
safekeeping and physical preservation of the Notes and the Property Trustee
Account shall be to deal with such property in a similar manner as the
Property Trustee deals with similar property for its own account, subject
to the protections and limitations on liability afforded to the Property
Trustee under this Declaration and the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or liability for or
with respect to the value, genuineness, existence or sufficiency of the
Notes or the payment of any taxes or assessments levied thereon or in
connection therewith;
(vii) the Property Trustee shall not be liable for any interest on
any money received by it except as it may otherwise agree with the Sponsor.
Money held by the Property Trustee need not be segregated from other funds
held by it except in relation to the Property Trustee Account maintained by
the Property Trustee pursuant to Section 3.8(c)(i) and except to the extent
otherwise required by law;
(viii) the Property Trustee shall not be responsible for monitoring
the compliance by the Regular Trustees or the Sponsor with their respective
duties under this Declaration, nor shall the Property Trustee be liable for
the default or misconduct of the Regular Trustees or the Sponsor; and
(ix) the Property Trustee shall have no liability for or with
respect to any statement contained in any registration or offering
materials prepared in connection with the Trust Securities.
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SECTION 3.10 CERTAIN RIGHTS OF PROPERTY TRUSTEE.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness or
other paper or document believed by it to be genuine and to have been
signed, sent or presented by the proper party or parties;
(ii) any direction or act of the Sponsor or the Regular Trustees
contemplated by this Declaration shall be sufficiently evidenced by a
Direction or an Officers' Certificate;
(iii) whenever in the administration of this Declaration the Property
Trustee shall deem it desirable that a matter be proved or established
before taking, suffering or omitting any action hereunder, the Property
Trustee (unless other evidence is herein specifically prescribed) may, in
the absence of bad faith on its part, request and rely upon an Officers'
Certificate which, upon receipt of such request, shall be promptly
delivered by the Sponsor or the Regular Trustees;
(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or securities
laws) or any rerecording, refiling or registration thereof;
(v) the Property Trustee may consult with counsel or other experts
and the advice or opinion of such counsel and experts with respect to legal
matters or advice within the scope of such expert's area of expertise shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in accordance
with such advice or opinion. Such counsel may be counsel to the Sponsor or
any of its Affiliates, and may include any of its employees. The Property
Trustee shall have the right at any time to seek instructions concerning
the administration of this Declaration from any court of competent
jurisdiction;
(vi) the Property Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Declaration at the request
or direction of any Holder, unless such Holder shall have provided to the
Property Trustee security and indemnity, acceptable to the Property
Trustee, against the costs, expenses (including attorneys' fees and
expenses) and liabilities that might be incurred by it in complying with
such request or direction, including such reasonable advances as may be
requested by the Property Trustee, provided that nothing contained in this
Section 3.10(a)(vi) shall be taken to relieve the Property Trustee, upon
the
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occurrence of an Event of Default, of its obligation to exercise the rights
and powers vested in it by this Declaration;
(vii) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Property Trustee, in its
discretion, may make such further inquiry or investigation into such facts
or matters as it may see fit;
(viii) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys and the Property Trustee shall not be responsible for
any misconduct or negligence on the part of any agent or attorney appointed
with due care by it hereunder;
(ix) any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders of the Trust Securities, and
the signature of the Property Trustee or its agents alone shall be
sufficient and effective to perform any such action and no third party
shall be required to inquire as to the authority of the Property Trustee to
so act or as to its compliance with any of the terms and provisions of this
Declaration, both of which shall be conclusively evidenced by the Property
Trustee's or its agent's taking such action;
(x) whenever in the administration of this Declaration the Property
Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder the
Property Trustee (A) may request instructions from the Holders of the Trust
Securities, which instructions may only be given by the Holders of the same
proportion in liquidation amount of the Trust Securities as would be
entitled to direct the Property Trustee under the terms of the Trust
Securities in respect of such remedy, right or action, (B) may refrain from
enforcing such remedy or right or taking such other action until such
instructions are received, and (C) shall be protected in acting in
accordance with such instructions; and
(xi) except as otherwise expressly provided by this Declaration, the
Property Trustee shall not be under any obligation to take any action that
is discretionary under the provisions of this Declaration.
(b) No provision of this Declaration shall be deemed to impose any duty or
obligation on the Property Trustee to perform any act or acts, or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty
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or obligation. No permissive power or authority available to the Property
Trustee shall be construed to be a duty.
SECTION 3.11 DELAWARE TRUSTEE.
Notwithstanding any other provision of this Declaration other than Sections
5.2 and 8.1(b), the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Regular Trustees or the Property Trustee described in
this Declaration. Except as set forth in Sections 5.2 and 8.1(b), the Delaware
Trustee shall be a Trustee for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Business Trust Act. The Delaware Trustee
shall be entitled to the benefit of all of the immunities and indemnities that
the Property Trustee is entitled to under this Declaration.
SECTION 3.12 EXECUTION OF DOCUMENTS.
Unless otherwise determined by the Regular Trustees, and except as
otherwise required by the Business Trust Act, a majority of, or, if there are
only two, 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 TRUST
SECURITIES.
The recitals contained in this Declaration and the Trust Securities shall
be taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as
to the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration or the Trust Securities.
SECTION 3.14 DURATION OF TRUST.
The Trust, unless terminated pursuant to the provisions of Article VIII
hereof, shall have existence for 49 years from the Closing Date.
SECTION 3.15 MERGERS.
(a) The Trust may not consolidate, amalgamate, merge with or into, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except as
described in Section 3.15(b) and (c).
(b) The Trust may, with the consent of a majority of the Regular Trustees
and without the consent of the Holders of the Trust Securities, the Delaware
Trustee or the
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Property Trustee, consolidate, amalgamate, merge with or into, or be replaced by
a trust organized as such under the laws of any State if:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the Trust
under the Trust Securities; or
(B) substitutes for the Preferred Securities other securities
having substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the
same as the Preferred Securities rank with respect to Distributions
and payments upon liquidation, redemption and otherwise;
(ii) the Note Issuer expressly acknowledges a trustee of the
Successor Entity that possesses the same powers and duties as the Property
Trustee as the Holder of the Notes;
(iii) the Preferred Securities or any Successor Securities are
listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange, the NASDAQ National Market
or other organization on which the Preferred Securities are then listed;
(iv) such merger, consolidation, amalgamation or replacement does
not adversely affect the rights, preferences and privileges of the Holders
of the Trust Securities (including any Successor Securities) in any
material respect;
(v) such merger, consolidation, amalgamation or replacement does
not cause the Preferred Securities or any Successor Securities to be
downgraded by any nationally recognized statistical rating organization;
(vi) such Successor Entity has a purpose identical to that of the
Trust;
(vii) prior to such merger, consolidation, amalgamation or
replacement, the Sponsor has received an opinion of a nationally recognized
independent counsel to the Trust experienced in such matters to the effect
that:
(A) such merger, consolidation, amalgamation or replacement
does not adversely affect the rights, preferences and privileges of the
Holders of the Trust Securities (including any Successor Securities) in any
material respect 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; and
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(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, except with the
consent of Holders of 100% in liquidation amount of the Trust 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 such consolidation, amalgamation, merger or replacement would
cause the Trust or Successor Entity not to be classified for United States
federal income tax purposes as a grantor trust.
ARTICLE IV
SPONSOR
SECTION 4.1 SPONSOR'S PURCHASE OF COMMON SECURITIES.
On the Closing Date the Sponsor will purchase all the Common Securities
issued by the Trust, in an amount equal to at least 3% of the capital of the
Trust, at the same time as the Preferred Securities are sold.
SECTION 4.2 RESPONSIBILITIES OF THE SPONSOR.
In connection with the issue and sale of the Preferred Securities, the
Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
(a) to prepare for filing by the Trust with the Commission a registration
statement on Form S-3 in relation to the Preferred Securities, including any
amendments thereto;
(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 or 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 relating to the registration of the Preferred Securities
under Section 12(b) of the Exchange Act, including any amendments thereto; and
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(e) to negotiate the terms of the Underwriting Agreement and Pricing
Agreement providing for the sale of the Preferred Securities.
ARTICLE V
TRUSTEES
SECTION 5.1 NUMBER OF TRUSTEES.
The number of Trustees shall initially be three (3), and:
(a) at any time before the issuance of any Trust Securities, the Sponsor
may, by written instrument, increase or decrease the number of Trustees; and
(b) after the issuance of any 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 one (1) Trustee, in the
-------- -------
case of a natural person, shall be a person who is a resident of the State of
Delaware or that, if not a natural person, is 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 Parent (a "Regular Trustee"); and (3) one Trustee shall be the Property
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 Property Trustee has its principal place of business in
the State of Delaware and otherwise meets the requirements of applicable law,
then the Property Trustee shall also be the Delaware Trustee and Section 3.11
shall have no application. Except as otherwise provided, the Delaware Trustee's
sole duty shall be to, upon the request of the other Trustees or the Sponsor,
execute any documents and maintain custody of any records required to form,
maintain the existence of, or dissolve the Trust under the Business Trust Act.
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SECTION 5.3 PROPERTY TRUSTEE; ELIGIBILITY.
(a) There shall at all times be one Trustee which shall act as Property
Trustee which shall:
(i) not be an Affiliate of the Sponsor;
(ii) be a corporation organized and doing business under the laws
of the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Commission to act as an institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust powers, having
a combined capital and surplus of at least 50 million U.S. dollars
($50,000,000), and subject to supervision or examination by Federal, State,
Territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority referred to above,
then for the purposes of this Section 5.3(a)(ii), the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
(b) If at any time the Property Trustee shall cease to be eligible to so
act under Section 5.3(a), the Property Trustee shall immediately resign in the
manner and with the effect set forth in Section 5.6(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Property Trustee and the Holder of the Common Securities (as if it were the
obligor referred to in Section 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.
(d) The Indenture and 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 Property Trustee shall be Wilmington Trust Company.
SECTION 5.4 QUALIFICATIONS OF REGULAR TRUSTEES AND DELAWARE TRUSTEE
GENERALLY.
Each Regular Trustee and the Delaware Trustee (unless the Property 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.
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SECTION 5.5 INITIAL REGULAR TRUSTEES.
(a) The initial Regular Trustees shall be Wayne R. Huneke and Richard R.
Crowl.
(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 a majority
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 Trust Securities, by written
instrument executed by Sponsor; and
(ii) after the issuance of any Trust 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) The Trustee that acts as:
(i) Property Trustee shall not be removed in accordance with
Section 5.6(a) until a Successor Trustee possessing the qualifications to
act as Property Trustee under Section 5.3 (a "Successor Property Trustee")
has been appointed and has accepted such appointment by written instrument
executed by such Successor Property Trustee and delivered to the Regular
Trustees and the Sponsor; and
(ii) 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
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been appointed and has accepted such appointment by written instrument
executed by such Successor Delaware Trustee and delivered to the Regular
Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until his successor
shall have been appointed or until his death, removal or resignation. Any
Trustee may resign from office (without need for prior or subsequent accounting)
by any instrument in writing signed by the Trustee and delivered to the Sponsor
and the Trust, which resignation shall take effect on such delivery or upon such
later date as is specified therein; provided, however, that:
(i) No such resignation of the Trustee that acts as the Property
Trustee shall be effective:
(A) until a Successor Property Trustee has been appointed and
has accepted such appointment by instrument executed by such Successor
Property Trustee and delivered to the Trust, the Sponsor and the
resigning Property Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the Holders of the
Trust Securities; and
(ii) no such resignation of the Trustee that acts as the Delaware
Trustee shall be effective until a Successor Delaware Trustee has been
appointed and has accepted such appointment by instrument executed by such
Successor Delaware Trustee and delivered to the Trust, the Sponsor and the
resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best efforts to
promptly appoint a Successor Delaware Trustee or Successor Property Trustee, as
the case may be, as the Property Trustee or the Delaware Trustee if the
resigning Property Trustee or Delaware Trustee delivers an instrument of
resignation in accordance with this Section 5.6.
(e) If no Successor Property Trustee or Successor Delaware Trustee shall
have been appointed and accepted appointment as provided in this Section 5.6
within 60 days after delivery to the Sponsor and the Trust of an instrument of
resignation, the resigning Property Trustee or Delaware Trustee, as applicable,
may petition any court of competent jurisdiction for appointment of a Successor
Property Trustee or Successor Delaware Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a Successor
Property Trustee or Successor Delaware Trustee, as the case may be.
(f) No Property Trustee or Delaware Trustee shall be liable for the acts
or omissions to act of any Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
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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 existence of such vacancy by 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.
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 a
vote of a majority of the Regular Trustees present (whether in person or by
telephone) and eligible to vote with respect to such matter, provided that a
Quorum is present, or without a meeting by the unanimous written consent of the
Regular Trustees.
SECTION 5.10 DELEGATION OF POWER.
(a) Any Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any documents contemplated in Section
3.6, including any registration
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statement or amendment thereto filed with the Commission, or making any other
governmental filing; and
(b) the Regular Trustees shall have power to delegate from time to time to
such of their number or to officers of the Trust the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the Regular Trustees or otherwise as the Regular Trustees may deem expedient,
to the extent such delegation is not prohibited by applicable law or contrary to
the provisions of the Trust, as set forth herein.
SECTION 5.11 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Property 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 Property 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 Property Trustee or the Delaware
Trustee, as the case may be, shall be the successor of the Property 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 other than as required by the Business Trust Act.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 DISTRIBUTIONS.
Holders shall receive Distributions in accordance with the applicable
terms of the relevant Holder's Trust Securities. Distributions shall be made on
the Preferred Securities and the Common Securities in accordance with the
preferences set forth in their respective terms. If and to the extent that the
Note Issuer makes a payment of interest (including Deferred Interest (as defined
in the Indenture)), premium and principal on the Notes held by the Property
Trustee (the amount of any such payment being a "Payment Amount"), the Property
Trustee shall and is directed, to the extent funds are available for that
purpose, to make a distribution (a "Distribution") of the Payment Amount to
Holders.
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ARTICLE VII
TRUST SECURITIES
SECTION 7.1 GENERAL PROVISIONS REGARDING TRUST SECURITIES.
(a) The Regular Trustees shall on behalf of the Trust issue one class of
preferred securities representing undivided beneficial interests in the assets
of the Trust having such terms as are set forth in Exhibit A and incorporated
herein by reference (the "Preferred Securities") and one class of common
securities representing undivided beneficial interests in the assets of the
Trust having such terms as are set forth in Exhibit A (the "Common Securities").
The Trust shall have no securities or other interests in the assets of the Trust
other than the Preferred Securities and the Common Securities.
(b) The Certificates shall be signed on behalf of the Trust by the Regular
Trustees (or if there are more than two Regular Trustees by any two of the
Regular Trustees). Such signatures may be the manual or facsimile signatures of
the present or any future Regular Trustee. Typographical and other minor errors
or defects in any such reproduction of any such signature shall not affect the
validity of any Certificate. In case any Regular Trustee of the Trust who shall
have signed any of the Trust Securities shall cease to be such Regular Trustee
before the Certificates so signed shall be delivered by the Trust, such
Certificates nevertheless may be delivered as though the person who signed such
Certificates had not ceased to be such Regular Trustee; and any Certificate may
be signed on behalf of the Trust by any such persons who, at the actual date of
execution of such Trust Security, shall be the Regular Trustees of the Trust,
although at the date of the execution and delivery of 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 or identification or designation
and such legends or endorsements as the Regular Trustees may deem appropriate,
or as may be required to comply with any law or with any rule or regulation of
any stock exchange on which Trust Securities may be listed, or to conform to
usage.
(c) The consideration received by the Trust for the issuance of the Trust
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 Trust Securities as provided in this Declaration,
the Trust Securities so issued shall be deemed to be validly issued, fully paid
and non-assessable.
(e) Every Person, who, 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.
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SECTION 7.2 PAYING AGENT.
In the event that the Preferred Securities are not in book-entry only form,
the Trust shall maintain in the Borough of Manhattan, City of New York, State of
New York, an office or agency where the Preferred Securities may be presented
for payment ("Paying Agent"). Any Paying Agent shall comply with Section
3.17(b) of the Trust Indenture Act. The Trust may appoint the Paying Agent and
may appoint one or more additional paying agents in such other locations as it
shall determine. The term "Paying Agent" includes any additional paying agent.
The Trust may change any Paying Agent without prior notice to any Holder. The
Trust shall notify the Property Trustee of the name and address of any Paying
Agent not a party to this Declaration. If the Trust fails to appoint or
maintain another entity as Paying Agent, the Property Trustee shall act as such.
The Trust or any of its Affiliates may act as Paying Agent.
ARTICLE VIII
TERMINATION
SECTION 8.1 TERMINATION OF TRUST.
(a) The Trust shall terminate on the earlier of:
(i) June 3, 2046;
(ii) upon the bankruptcy of any Holder of Common Securities or
the Sponsor;
(iii) upon the filing of a certificate of dissolution or its
equivalent with respect to any Holder of Common Securities or the Sponsor;
the filing of a certificate of cancellation with respect to the Trust or
the revocation of any Holder of Common Securities, or the Sponsor's,
charter and the expiration of 90 days after the date of revocation without
a reinstatement thereof;
(iv) upon the entry of a decree of judicial dissolution of any
Holder of Common Securities, the Sponsor or the Trust;
(v) when all of the Trust Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall have been
paid to the Holders in accordance with the terms of the Trust Securities;
(vi) upon the occurrence and continuation of a Tax Event pursuant
to which the Trust shall have been dissolved in accordance with the terms
of the Trust Securities and all of the Notes endorsed thereon shall have
been distributed to the Holders of Trust Securities in exchange for all of
the Trust Securities; or
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(vii) before the issuance of any Trust Securities, with the
consent of all of the Regular Trustees and the Sponsor.
(b) As soon as is practicable after the occurrence of an event referred to
in Section 8.1(a), the Delaware Trustee shall file a certificate of cancellation
with the Secretary of State of the State of Delaware.
(c) The provisions of Section 3.9 and Article X shall survive the
termination of the Trust.
ARTICLE IX
TRANSFER OF INTEREST
SECTION 9.1 TRANSFER OF TRUST SECURITIES.
(a) Trust Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Declaration and in
the terms of the Trust Securities. Any transfer or purported transfer of any
Trust Security not made in accordance with this Declaration shall be null and
void.
(b) Subject to this Article IX, Preferred Securities shall be freely
transferable.
(c) Subject to this Article IX, the Sponsor and any Related Party may only
transfer Common Securities to the Sponsor or a Related Party of the Sponsor;
provided that, any such transfer is subject to the conditions precedent that the
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 governmental charges that may be imposed in relation
to it. Upon surrender for registration of transfer of any Certificate, the
Regular Trustees shall cause one or more new Certificates to be issued in the
name of the designated transferee or transferees. Every Certificate surrendered
for registration of transfer shall be accompanied by a written instrument of
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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 and the documents
incorporated by reference herein.
SECTION 9.3 DEEMED TRUST SECURITY HOLDERS.
The Trustees may treat the Person in whose name any Certificate shall be
registered on the books and records of the Trust as the sole holder of such
Certificate and of the Trust Securities represented by such Certificate for
purposes of receiving Distributions and for all other purposes whatsoever and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Certificate or in the Trust Securities represented by such
Certificate on the part of any Person, whether or not the Trust shall have
actual or other notice thereof.
SECTION 9.4 BOOK ENTRY INTERESTS.
Unless otherwise specified in the terms of the Preferred Securities, the
Preferred Securities Certificates, on original issuance, will be issued in the
form of one or more fully registered, global Preferred Security Certificates
(each, a "Global Certificate"), to be delivered to DTC, the initial Depositary,
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
Depositary for all purposes of this Declaration (including the payment of
Distributions on the Global Certificates and receiving approvals, votes or
consents hereunder) as the Holder of the Preferred Securities and the sole
holder of the Global Certificates and shall have no obligation to the Preferred
Security Beneficial Owners;
(c) to the extent that the provisions of this Section 9.4 conflict with
any other provisions of the Declaration, the provisions of this Section 9.4
shall control; and
(d) the rights of the Preferred Security Beneficial Owners shall be
exercised only through the Depositary and shall be limited to those established
by law and agreements between such Preferred Security Beneficial Owners and the
Depositary and/or the
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Depositary Participants. The Depositary shall receive and transmit payments of
Distributions on the Global Certificates to such Depositary Participants. The
Depositary will make book entry transfers among the Depositary Participants.
SECTION 9.5 NOTICES TO DEPOSITARY.
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 Depositary and shall have no notice obligations to the
Preferred Security Beneficial Owners.
SECTION 9.6 APPOINTMENT OF SUCCESSOR DEPOSITARY.
If any Depositary elects to discontinue its services as securities
depositary with respect to the Preferred Securities, the Regular Trustees may,
in their sole discretion, appoint a successor Depositary with respect to such
Preferred Securities.
SECTION 9.7 DEFINITIVE PREFERRED SECURITY CERTIFICATES.
If:
(a) a Depositary elects to discontinue its services as securities
depositary with respect to the Preferred Securities and a successor Depositary
is not appointed within 90 days after such discontinuance pursuant to Section
9.6; or
(b) the Regular Trustees elect after consultation with the Sponsor to
terminate the book entry system through the Depositary with respect to the
Preferred Securities,
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 Depositary,
accompanied by registration instructions, the Regular Trustees shall cause
Definitive Preferred Security Certificates to be delivered to Preferred Security
Beneficial Owners in accordance with the instructions of the Depositary.
Neither the Trustees nor the Trust shall be liable for any delay in delivery of
such instructions and each of them may conclusively rely on, and shall be
protected in relying on, said instructions of the Depositary. The Definitive
Preferred Security Certificates shall be printed, lithographed or engraved or
may be produced in any other manner as is reasonably acceptable to the Regular
Trustees, as evidenced by their execution thereof, and may have such letters,
numbers or other marks of identification or designation and such legends or
endorsements as the Regular Trustees may deem appropriate or as may be required
to comply with any law the Trustees may deem
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appropriate, or as may be required to comply with any rule or regulation made
pursuant thereto or with any rule or regulation of any national securities
exchange, the NASDAQ National Market or other organization on which the
Preferred Securities are listed or admitted for trading, or to conform to usage.
SECTION 9.8 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.
If:
(a) any mutilated Certificates should be surrendered to the Regular
Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such security or
indemnity as may be required by them to keep each of them harmless;
then:
(c) in the absence of notice that such Certificate shall have been
acquired by a bona fide purchaser, any two Regular Trustees on behalf of the
Trust shall execute and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
denomination. In connection with the issuance of any new Certificate under this
Section 9.8, the Regular Trustees may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Certificate issued pursuant to this Section 9.8 shall
constitute conclusive evidence of an ownership interest in the relevant Trust
Securities, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
ARTICLE X
LIMITATION OF LIABILITY OF HOLDERS
OF TRUST SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 LIABILITY.
(a) Except as expressly set forth in this Declaration, the Preferred
Securities Guarantee and the terms of the Trust 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 Trust
Securities, which return shall be made solely from assets of the Trust; or
(ii) be required to pay to the Trust or to any Holder of Trust
Securities
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any deficit upon dissolution of the Trust or otherwise.
(b) Pursuant to Section 3803(a) of the Business Trust Act:
(i) the Holder of the Common Securities shall be liable for all
of the debts and obligations of the Trust (other than with respect to the
Trust Securities) to the extent not satisfied out of the Trust's assets;
and
(ii) the Holders of the Preferred Securities shall be entitled to
the same limitation of personal liability extended to stockholders of
private corporations for profit organized under the General Corporation Law
of the State of Delaware.
SECTION 10.2 EXCULPATION.
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Trust or any Covered Person for any loss, damage or
claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Declaration or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's gross negligence (or, in the
case of the Property Trustee, negligence) or willful misconduct with respect to
such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions, reports
or statements presented to the Trust by any Person as to matters the Indemnified
Person reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Trust, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which Distributions to
Holders of Trust Securities might properly be paid.
SECTION 10.3 FIDUCIARY DUTY.
(a) To the extent that, at law or in equity, an Indemnified Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions
of this Declaration, to the extent that they restrict the duties and liabilities
of an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.
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(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between an
Indemnified Person and any Covered Person; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified Person shall
act in a manner that is, or provides terms that are, fair and reasonable to
the Trust or any Holder of Trust Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by this Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted or
required to make a decision:
(i) in its "discretion" or under a grant of similar authority,
the Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have no duty
or obligation to give any consideration to any interest of or factors
affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Declaration or
by applicable law.
SECTION 10.4 INDEMNIFICATION.
(a) (i) The Note 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 right of the Trust) by reason
of the fact that such Person is or was a Company Indemnified Person against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by such Person in connection
with such action, suit or proceeding if such Person acted in good faith and
in a manner such Person 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 such Person's conduct was
unlawful. The termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a
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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 such Person 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 such
Person's conduct was unlawful.
(ii) The Note 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 such Person is or was a Company
Indemnified Person against expenses (including attorneys' fees) actually
and reasonably incurred by such Person in connection with the defense or
settlement of such action or suit if such Person acted in good faith and in
a manner such Person 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 to 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, such Person shall be indemnified, to the
full extent permitted by law, against expenses (including attorneys' fees)
actually and reasonably incurred by such Person 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 Note
Issuer only as authorized in the specific case upon a determination that
indemnification of the Company Indemnified Person is proper in the
circumstances because such Person has met the applicable standard of
conduct set forth in paragraphs (i) and (ii) of this Section 10.4(a). 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
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action, suit or proceeding referred to in paragraphs (i) and (ii) of this
Section 10.4(a) shall be paid by the Note 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 such Person is not
entitled to be indemnified by the Note Issuer as authorized in this Section
10.4(a). Notwithstanding the foregoing, no advance shall be made by the
Note Issuer if a determination is reasonably and promptly made (1) by the
Regular Trustees by a majority vote of a quorum of disinterested Regular
Trustees, (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) 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 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 such
Person's 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
such Person's 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 Note
Issuer or Preferred Security Holders of the Trust or otherwise, both as to
action in such Person's 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 Note 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 Note Issuer or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company Indemnified
Person against any liability asserted against such Person and incurred by
such Person in any such capacity, or arising out of such Person's status as
such, whether or not the Note Issuer would have the power to indemnify such
Person 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
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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 such Person 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 Note Issuer agrees to indemnify the (i) Property Trustee, (ii) the
Delaware Trustee, (iii) any Affiliate of the Property Trustee and the Delaware
Trustee, and (iv) any officers, directors, shareholders, members, partners,
employees, representatives, custodians, nominees or agents of the Property
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, liability, claim 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 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. To secure the
same, each Fiduciary Indemnified Person shall have a lien on the property and
assets of the Trust subordinate only to the rights and interests thereon of the
Holders of the Preferred Securities.
SECTION 10.5 OUTSIDE BUSINESSES.
Any Covered Person, the Sponsor, the Note Issuer, the Delaware Trustee and
the Property Trustee may engage in or possess an interest in other business
ventures of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders of Trust
Securities shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom and the pursuit
of any such venture, even if competitive with the business of the Trust, shall
not be deemed wrongful or improper. No Covered Person, the Sponsor, the Note
Issuer, the Delaware Trustee or the Property Trustee shall be obligated to
present any particular investment or other opportunity to the Trust even if such
opportunity is of a character that, if presented to the Trust, could be taken by
the Trust, and any Covered Person, the Sponsor, the Note Issuer, the Delaware
Trustee and the Property Trustee shall have the right to take for its own
account (individually or as a partner or fiduciary) or to recommend to others
any such particular investment or other opportunity. Any Covered Person, the
Delaware Trustee and the Property Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the Sponsor,
or may act as
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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 records
of the Trust shall be examined by and reported upon as of the end of each Fiscal
Year by a firm of independent certified public accountants selected by the
Regular Trustees.
(b) The Regular Trustees shall cause to be prepared and delivered to each
of the Holders of Trust Securities, within 90 days after the end of each Fiscal
Year of the Trust, annual financial statements of the Trust, including a balance
sheet of the Trust as of the end of such Fiscal Year, and the related statements
of income or loss.
(c) The Regular Trustees shall cause to be duly prepared and delivered to
each of the Holders of Trust Securities any United States federal income tax
information statement required by the Code, containing such information with
regard to the Trust Securities held by each Holder as is required, by the Code
and the Treasury Regulations, and any comparable statements required to be
provided under the law of any other taxing jurisdiction. Notwithstanding any
right under the Code or other law to deliver any such statement at a later date,
the Regular Trustees shall endeavor to deliver all such statements within 30
days after the end of each Fiscal Year of the Trust.
(d) The Regular Trustees shall cause to be duly prepared and filed with
the appropriate taxing authority an annual United States federal income tax
return Form 1041 or such other form required by United States federal income tax
law, and any other tax returns or reports required to be filed by the Regular
Trustees on behalf of the Trust with any state or local taxing authority.
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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 Notes held by the Property Trustee shall be made directly to the
Property Trustee Account and no other funds of the Trust shall be deposited in
the Property Trustee Account. The sole signatories for such accounts shall be
designated by the Regular Trustees; provided, however, that the Property Trustee
shall designate the sole signatories for the Property Trustee Account.
SECTION 11.4 WITHHOLDING.
The Trust and the Regular Trustees shall comply with all withholding
requirements under United States federal, state and local law. The Trust shall
request, and the Holders shall provide to the Trust, such forms or certificates
as are necessary to establish an exemption from withholding with respect to each
Holder, and any representations and forms as shall reasonably be requested by
the Trust to assist it in determining the extent of, and in fulfilling, its
withholding obligations. The Regular Trustees shall file required forms with
applicable jurisdictions and, unless an exemption from withholding is properly
established by a Holder, shall remit amounts withheld with respect to the Holder
to applicable jurisdictions. To the extent that the Trust is required to
withhold and pay over any amounts to any authority with respect to Distributions
or allocations to any Holder, the amount withheld shall be deemed to be a
Distribution in the amount of the withholding to the Holder. In the event of
any claimed over withholding, Holders shall be limited to an action against the
applicable jurisdiction. If the amount required to be withheld was not withheld
from actual Distributions made to any Holder, the Trust may reduce subsequent
Distributions to such Holder by the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 AMENDMENTS.
(a) Except as otherwise provided in this Declaration or by any applicable
terms of the Trust Securities, this Declaration may only be amended by a written
instrument approved and executed by:
(i) a majority of the Regular Trustees;
(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Property Trustee, the Property Trustee;
and
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(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 purported amendment shall be void
and ineffective:
(i) unless, in the case of any proposed amendment, the Property
Trustee shall have first received an Officers' Certificate from the Trust
and the Sponsor that such amendment is permitted by, and conforms to, the
terms of this Declaration (including the terms of the Trust Securities);
(ii) unless, in the case of any proposed amendment which affects
the rights, powers, duties, obligations or immunities of the Property
Trustee, the Property Trustee shall have first received an opinion of
counsel (who may be counsel to the Sponsor or the Trust) that such
amendment is permitted by, and conforms to, the terms of this Declaration
(including the terms of the Trust Securities); and 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
Preferred 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
Property Trustee in contravention of the Trust Indenture Act; or
(C) cause the Trust to be deemed to be an Investment Company
required to be registered under the Investment Company Act.
(c) At such time after the Trust has issued any Trust Securities that
remain outstanding, any amendment that would adversely affect the rights,
privileges or preferences of any Holder of Trust Securities may be effected only
with such additional requirements as may be set forth in the terms of such Trust
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 Trust Securities.
(e) Article IV shall not be amended without the consent of the Holders of
a Majority in liquidation amount of the Common Securities.
(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.
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(g) Notwithstanding Section 12.1(c), this Declaration may be amended
without the consent of the Holders of the Trust Securities to:
(i) cure any ambiguity;
(ii) correct or supplement any provision in this Declaration that
may be defective or inconsistent with any other provision of this
Declaration;
(iii) add to the covenants, restrictions or obligations of the
Sponsor;
(iv) conform to any change in Rule 3a-5 or other exemption from
the requirement to register as an Investment Company under the Investment
Company Act or written change in the interpretation or application thereof
by any legislative body, court, government agency or regulatory authority
which amendment; and
(v) to modify, eliminate and add to any provision of this
Declaration to such extent as may be necessary. The Regular Trustees agree
to provide the Property Trustee with a copy of any prior amendment as soon
as practicable after such amendment has been executed by all required
parties.
provided, however, such amendment does not have a material adverse effect on the
rights, preferences or privileges of the Holders of the Trust Securities
SECTION 12.2 MEETINGS OF THE HOLDERS OF TRUST SECURITIES; ACTION BY
WRITTEN CONSENT.
(a) Meetings of the Holders of any class of Trust Securities may be called
at any time by the Regular Trustees (or as provided in the terms of the Trust
Securities) to consider and act on any matter on which Holders of such class of
Trust Securities are entitled to act under the terms of this Declaration, the
terms of the Trust Securities or the rules of any national securities exchange,
the NASDAQ National Market or other organization on which the Preferred
Securities are listed or admitted for trading.
(b) Except to the extent otherwise provided in the terms of the Trust
Securities, the following provisions shall apply to meetings of Holders of Trust
Securities:
(i) notice of any such meeting shall be given to all the Holders
of Trust Securities having a right to vote thereat at least 7 days and not
more than 60 days before the date of such meeting. Whenever a vote,
consent or approval of the Holders of Trust Securities is permitted or
required under this Declaration or the rules of any stock exchange, the
NASDAQ National Market or other organization on which the Preferred
Securities are listed or admitted for trading, such vote, consent or
approval may be given at a meeting of the Holders of Trust Securities. Any
action that may be taken at a meeting of the Holders of Trust Securities
may be taken without a meeting if a consent in writing setting forth the
action so taken is signed by the Holders of Trust Securities owning not
less than the minimum amount of Trust
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Securities in liquidation amount that would be necessary to authorize or
take such action at a meeting at which all Holders of Trust Securities
having a right to vote thereon were present and voting. Prompt notice of
the taking of action without a meeting shall be given to the Holders of
Trust Securities entitled to vote who have not consented in writing. The
Regular Trustees may specify that any written ballot submitted to a Holder
for the purpose of taking any action without a meeting shall be returned to
the Trust within the time specified by the Regular Trustees;
(ii) each Holder of a Trust Security may authorize any Person to
act for it by proxy on all matters in which a Holder of Trust Securities is
entitled to participate, including waiving notice of any meeting, or voting
or participating at a meeting. No proxy shall be valid after the
expiration of 11 months from the date thereof unless otherwise provided in
the proxy. Every proxy shall be revocable at the pleasure of the Holder of
Trust Securities executing it. Except as otherwise provided herein, all
matters relating to the giving, voting or validity of proxies shall be
governed by the General Corporation Law of the State of Delaware relating
to proxies, and judicial interpretations thereunder as if the Trust were a
Delaware corporation and the Holders of the Trust Securities were
stockholders of a Delaware corporation;
(iii) each meeting of the Holders of the Trust Securities shall
be conducted by the Regular Trustees or by such other Person that the
Regular Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration, the terms
of the Trust Securities, the Trust Indenture Act or the listing rules of
any stock exchange, the NASDAQ National Market or other organization on
which the Preferred Securities are then listed or trading otherwise
provides, the Regular Trustees, in their sole discretion, shall establish
all other provisions relating to meetings of Holders of Trust Securities,
including notice of the time, place or purpose of any meeting at which any
matter is to be voted on by any Holders of Trust Securities, waiver of any
such notice, action by consent without a meeting, the establishment of a
record date, quorum requirements, voting in person or by proxy or any other
matter with respect to the exercise of any such right to vote.
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ARTICLE XIII
REPRESENTATIONS AND WARRANTIES OF
PROPERTY TRUSTEE AND DELAWARE TRUSTEE
SECTION 13.1 REPRESENTATIONS AND WARRANTIES OF PROPERTY TRUSTEE.
The trustee that acts as initial Property Trustee represents and warrants
to the Trust and to the Sponsor at the date of this Declaration, and each
successor Property Trustee represents and warrants to the Trust and the Sponsor
at the time of the successor Property Trustee's acceptance of its appointment as
Property Trustee, that:
(a) The Property Trustee is a banking corporation with trust powers, duly
organized, validly existing and in good standing under the laws of the United
States or 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 and with its principal place of business in Wilmington, Delaware.
(b) The execution, delivery and performance by the Property Trustee of this
Declaration has been duly authorized by all necessary corporate action on the
part of the Property Trustee. This Declaration has been duly executed and
delivered by the Property Trustee, and constitutes a legal, valid and binding
obligation of the Property Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law).
(c) The execution, delivery and performance of this Declaration by the
Property Trustee does not conflict with or constitute a breach of the charter or
By-laws of the Property Trustee.
(d) No consent, approval or authorization of, or registration with or
notice to, any State or Federal banking authority governing its banking or trust
powers is required for the execution, delivery or performance by the Property
Trustee, of this 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 to the
Sponsor at the time of its acceptance of its appointment as Delaware Trustee,
that:
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(a) The Delaware Trustee is either a natural person who is a resident of
the State of Delaware or, if not a natural person, an entity which has its
principal place of business in the State of Delaware.
(b) The execution, delivery and performance by the Delaware Trustee of this
Declaration has been duly authorized by all necessary corporate action on the
part of the Delaware Trustee. This Declaration has been duly executed and
delivered by the Delaware Trustee, 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) The execution, delivery and performance of this Declaration by the
Delaware Trustee does not conflict with or constitute a breach of the charter or
By-laws of the Delaware Trustee.
(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 State of Delaware, with trust power and authority to execute and deliver,
and to carry out and perform its obligations under the terms of, this
Declaration.
(e) No consent, approval or authorization of, or registration with or
notice to, any State or Federal banking authority governing its banking or trust
powers is required for the execution, delivery or performance by the Delaware
Trustee, of this Declaration (other than the filing of the Certificate of Trust
with the Secretary of State which certificate has been duly filed).
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 NOTICES.
All notices, instructions, requests and demands provided for in this
Declaration shall be in writing, duly signed by the party giving same, and shall
be delivered, telecopied or mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the Trust's
mailing address set forth below (or such other address as the Trust may give
notice of to the Holders of the Trust Securities):
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ReliaStar Financing II
c/o ReliaStar Financial Corp.
20 Washington Avenue South
Minneapolis, Minnesota 55401
Telecopy Number: (612) 372-5479
(b) if given to the Property Trustee, at the mailing address set forth
below (or such other address as the Property Trustee may give notice of to the
Holders of the Trust Securities):
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attn: Corporate Trust Administration
Telecopy Number: (302) 651-8882
(c) if given to the Delaware Trustee, at the mailing address set forth
below (or such other address as the Delaware Trustee may give notice of to the
Holders of the Trust Securities):
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attn: Corporate Trust Administration
Telecopy Number: (302) 651-8882
(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 to the Trust):
ReliaStar Financial Corp.
20 Washington Avenue South
Minneapolis, Minnesota 55401
Telecopy: (612) 372-5479
(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.
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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 not be
characterized for United States federal income tax purposes as an association
taxable as a corporation or a partnership but rather that the Trust be
characterized as a grantor trust or otherwise in a manner such that each Holder
of Trust Securities will be treated as owning an undivided beneficial interest
in the Notes. 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, the Trustees
and the Property Trustee shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
SECTION 14.6 PARTIAL ENFORCEABILITY.
If any provision of this Declaration, or the application of such provision
to any Person or circumstance, shall be held invalid, the remainder of this
Declaration, or the application of such to persons or circumstances other than
those to which it is held invalid, shall not be affected thereby.
SECTION 14.7 COUNTERPARTS.
This Declaration may contain more than one counterpart of the signature
page and this Declaration may be executed by the affixing of the signature of
each of the Trustees and the Property Trustee to one of such counterpart
signature pages. All of such counterpart signature pages shall be read as
though one, and they shall have the same force and effect as though all of the
signers had signed a single signature page.
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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.
/s/ Wayne R. Huneke
--------------------------------
Name: Wayne R. Huneke
as Regular Trustee
/s/ Richard R. Crowl
--------------------------------
Name: Richard R. Crowl
as Regular Trustee
Wilmington Trust Company,
as Delaware Trustee and Property Trustee
/s/ Donald G. MacKelcan
--------------------------------
Name: Donald G. MacKelcan
Title: Assistant Vice President
ReliaStar Financial Corp.,
as Sponsor
/s/ Richard R. Crowl
--------------------------------
Name: Richard R. Crowl
Title: Senior Vice President, General Counsel
and Secretary
<PAGE>
EXHIBIT A
TERMS OF
8.10% TRUST ORIGINATED PREFERRED SECURITIES
8.10% TRUST ORIGINATED COMMON SECURITIES
Pursuant to Section 7.1 of the Declaration of Trust, dated as of June 3,
1997 (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." 5,000,000 Preferred Securities of the Trust
with an aggregate liquidation amount with respect to the assets of the Trust of
$125 million, 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 "8.10% Trust Originated Preferred Securities" (the
"Preferred Securities"). The Certificates evidencing the Preferred Securities
shall be substantially in the form attached hereto as Annex I, with such changes
and additions thereto or deletions therefrom as may be required by ordinary
usage, custom or practice or to conform to the rules of any stock exchange on
which the Preferred Securities are listed.
(b) "Common Securities." 154,639.176 Common Securities of the Trust with an
aggregate liquidation amount with respect to the assets of the Trust of
$3,865,979.40, 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 "8.10% Trust Originated Common Securities" (the "Common
Securities"). The Certificates evidencing the Common Securities shall be
substantially in the form attached hereto as Annex II, with such changes and
additions thereto or deletions therefrom as may be required by ordinary usage,
custom or practice.
2. DISTRIBUTIONS.
(a) Distributions payable on each Trust Security will be fixed at a rate
per annum of 8.10% (the "Coupon Rate") of the stated liquidation amount of $25
per Trust Security, such rate being the rate of interest payable on the Notes to
be held by the Property Trustee. Distributions in arrears for more than one
quarter will bear interest thereon compounded quarterly at the Coupon Rate (to
the extent permitted by applicable law). The term "Distribution" 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 Notes held by the Property Trustee. The amount of Distributions
payable for any period will be computed for any full quarterly Distribution
period on the basis of a 360-day year of twelve 30-day months, and for any
period shorter than a full quarterly
<PAGE>
Distribution period for which Distributions are computed, Distributions will be
computed on the basis of the actual number of days elapsed per 30-day month.
(b) Distributions on the Trust Securities will be cumulative, will accrue
from June 3, 1997, and will be payable quarterly in arrears, on March 31, June
30, September 30, and December 31 of each year, commencing on June 30, 1997,
except as otherwise described below. The Note Issuer has the right under the
Indenture to defer payments of interest by extending the interest payment period
from time to time on the Notes for a period not exceeding 20 consecutive
quarters (each, an "Extension Period") and, during such Extension Period, during
which Extension Period no interest shall be due and payable on the Notes,
provided that no Extension Period shall last beyond the date of maturity of the
Notes. As a consequence of such deferral, 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. Prior to the termination
of any such Extension Period, the Note 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. 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 Note Issuer may commence a new Extension Period, subject
to the above requirements.
(c) Distributions on the Trust Securities will be payable to the Holders
thereof as they appear on the books and records of the Trust on the relevant
record dates. While the Preferred Securities remain in book-entry only form, the
relevant record dates shall be one Business Day prior to the relevant payment
dates which payment dates correspond to the interest payment dates on the Notes.
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 May 29, 1997 (the "Prospectus Supplement") to the Prospectus
dated May 27, 1997 (together, the "Prospectus") of the Trust included in the
Registration Statement on Form S-3 of the Sponsor and the Trust. The relevant
record dates for the Common Securities shall be the same record dates as for the
Preferred Securities. If the Preferred Securities shall not continue to remain
in book-entry only form, the relevant record dates for the Preferred Securities
shall conform to the rules of any stock exchange on which the securities are
listed and, if none, shall be selected by the Regular Trustees, which dates
shall be at least one Business Day but less than 60 Business Days before the
relevant payment dates, which payment dates correspond to the interest payment
dates on the Notes. Distributions payable on any Trust Securities that are not
punctually paid on any payment date, as a result of the Note Issuer having
failed to make a payment under the Notes, will cease to be payable to the Person
in whose name such Trust Securities are registered on the relevant record date,
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<PAGE>
and such Distribution will instead be payable to the Person in whose name such
Trust Securities are registered on the special record date or other specified
date determined in accordance with the Indenture. If any date on which
Distributions are payable on the Trust Securities is not a Business Day, then
payment of the Distribution payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other payment
in respect of any such delay) except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date.
(d) In the event that there is any money or other property held by or for
the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata (as defined herein) among the Holders of the Trust
Securities.
3. LIQUIDATION DISTRIBUTION UPON DISSOLUTION.
In the event of any voluntary or involuntary dissolution, winding-up or
termination of the Trust, the Holders of the Trust 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
Trust Securities after satisfaction of liabilities to creditors of the Trust an
amount equal to the aggregate of the stated liquidation amount of $25 per Trust
Security plus 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, Notes in an aggregate principal
amount equal to the aggregate stated liquidation amount of such Trust Securities
shall be distributed on a Pro Rata basis to the Holders of the Trust Securities
in exchange for such Trust Securities.
If, upon any such 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 Trust Securities shall be paid on a Pro Rata basis.
4. REDEMPTION AND DISTRIBUTION.
(a) Upon the repayment of the Notes in whole or in part, whether at
maturity or upon redemption either at the option of the Note Issuer or pursuant
to a tax event as described below, the proceeds from such repayment or payment
shall be simultaneously applied to redeem Trust Securities having an aggregate
liquidation amount equal to the aggregate principal amount of the Notes so
repaid or redeemed at a redemption price of $25 per Trust Security plus an
amount equal to accrued and unpaid Distributions thereon at the date of the
redemption, payable in cash (the "Redemption Price"). Holders will be given not
less than 30 nor more than 60 days notice of such redemption.
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(b) If fewer than all the outstanding Trust Securities are to be so
redeemed, the Common Securities and the Preferred Securities will be redeemed
Pro Rata and the Preferred Securities to be redeemed will be as described in
Paragraph 4(f)(ii) below.
(c) If a Tax Event shall occur and be continuing the Regular Trustees shall
dissolve the Trust and, after satisfaction of liabilities to creditors of the
Trust, cause Notes held by the Property Trustee, having an aggregate principal
amount equal to the aggregate stated liquidation amount of the Trust Securities,
to be distributed to the Holders of the Trust Securities in liquidation of such
Holders' interests in the Trust on a Pro Rata basis, within 90 days following
the occurrence of such Tax Event (the "90-Day Period"); provided, however, that
as a condition of such dissolution and distribution, the Regular Trustee shall
have received 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 Trust Securities will not recognize any gain or loss for
United States federal income tax purposes as a result of the dissolution of the
Trust and the distribution of Notes, and provided, further, that, if at the time
there is available to the Trust the opportunity to avoid, within the 90-day
Period, the Tax Event by taking some ministerial action, such as filing a form
or making an election, or pursuing some other similar reasonable measure that
has no adverse effect on the Trust, the Note Issuer, the Sponsor or the Holders
of the Trust Securities ("Ministerial Action"), the Trust or the Sponsor will
pursue such Ministerial Action in lieu of dissolution.
If (i) after receipt of a Dissolution Tax Opinion by and upon the request
of the Regular Trustees, the Note Issuer has received an opinion of a nationally
recognized independent tax counsel experienced in such matters (a "Redemption
Tax Opinion") to the effect that, as a result of a Tax Event, there is more than
an insubstantial risk that the Note Issuer would be precluded from deducting the
interest on the Notes for United States federal income tax purposes even if the
Notes were distributed to the Holders of Trust Securities in liquidation of such
Holders' interests in the Trust, as described in this Paragraph 4(c), or (ii)
the Regular Trustees shall have been informed by such tax counsel that a No
Recognition Opinion cannot be delivered to the Trust, the Note Issuer shall have
the right, upon not less than 30 nor more than 60 days notice, to redeem the
Notes in whole or in part for cash within 90 days following the occurrence of
such Tax Event and, following such redemption, Trust Securities with an
aggregate liquidation amount equal to the aggregate principal amount of the
Notes 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 Trust the opportunity to avoid, within such 90-Day Period, the Tax Event by
some Ministerial Action, the Trust or the Sponsor 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 "Dissolution Tax Opinion") to the effect that on or after the date of the
Prospectus Supplement, as a
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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 therefor or therein, or (b) any
amendment to, or change in, an interpretation or application of any such laws or
regulations by any legislative body, court, governmental agency or regulatory
authority, which amendment or change is enacted, promulgated, issued or
announced or which interpretation or pronouncement is issued or announced or
which action is taken, (c) any interpretation or pronouncement by any such body,
court, agency or authority that provides for a position with respect to such
laws or regulations that differs from the theretofore generally accepted
position, or (d) any action taken by any governmental agency or regulatory
authority, which amendment or change is enacted, promulgated or effective, or
which interpretation or pronouncement is issued or announced, or which action is
taken, in each case on or after the date of the Prospectus Supplement, there is
more than an insubstantial risk that (i) the Trust is or will be within 90 days
of the date thereof, subject to United States federal income tax with respect to
interest accrued or received on the Notes, (ii) interest payable by the Note
Issuer to the Trust on the Notes is not, or within 90 days of the date thereof
will not be, deductible, in whole or in part, by the Note Issuer for United
States federal income tax purposes, or (iii) the Trust is, or will be within 90
days of the date thereof, subject to more than a de minimis amount of taxes,
duties or other governmental charges.
On and from the date fixed by the Regular Trustees for any distribution of
Notes and dissolution of the Trust: (i) the Trust Securities will no longer be
deemed to be outstanding, (ii) the Depositary or its nominee, as the record
Holder of the Preferred Securities, will receive a registered global certificate
or certificates representing the Notes to be delivered upon such distribution,
and (iii) any certificates representing Trust Securities not held by the
Depositary or its nominee (or any successor Depositary or its nominee) will be
deemed to represent beneficial interests in the Notes 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 Trust Securities until such
certificates are presented to the Note Issuer or its agent for transfer or
reissue.
(d) The Trust may not redeem fewer than all the outstanding Trust
Securities unless all accrued and unpaid Distributions have been paid on all
Trust Securities for all quarterly Distribution periods terminating on or before
the date of redemption.
(e) If the Notes are distributed to holders of the Trust Securities,
pursuant to the terms of the Indenture, the Note Issuer will use its best
efforts to have the Notes listed on the New York Stock Exchange or on such other
exchange, the NASDAQ National Market or other organization as the Preferred
Securities were listed immediately prior to the distribution of the Notes.
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(f) Redemption or Distribution Procedures.
(i) Notice of any redemption of, or notice of distribution of Notes
in exchange for, the Trust Securities (a "Redemption/Distribution Notice")
will be given by the Trust by mail to each Holder of Trust Securities to be
redeemed or exchanged not fewer than 30 nor more than 60 days before the
date fixed for redemption or exchange thereof which, in the case of a
redemption, will be the date fixed for redemption of the Notes. For
purposes of the calculation of the date of redemption or exchange and the
dates on which notices are given pursuant to this Paragraph 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
Trust Securities. Each Redemption/Distribution Notice shall be addressed to
the Holders of Trust Securities at the address of each such Holder
appearing in the books and records of the Trust. No defect in the
Redemption/Distribution Notice or in the mailing of either thereof with
respect to any Holder shall affect the validity of the redemption or
exchange proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding Preferred
Securities are to be redeemed, the Preferred 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 the Depository or its nominee (or any
successor Depositary or its nominee) or any nominee, the distribution of
the proceeds of such redemption will be made to each Depositary (or Person
on whose behalf such nominee holds such securities) in accordance with the
procedures applied by such Depositary or nominee.
(iii) If Trust Securities are to be redeemed and the Trust gives
a Redemption/Distribution Notice, which notice may only be issued if the
Notes are redeemed as set out in this Paragraph 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 Note Issuer has
paid the Property Trustee a sufficient amount of cash in connection with
the related redemption or maturity of the Notes, the Property Trustee will
deposit irrevocably with the Depositary or its nominee (or successor
Depositary or its nominee) funds sufficient to pay the applicable
Redemption Price with respect to the Preferred Securities and will give the
Depositary irrevocable instructions and authority to pay the Redemption
Price to the Holders of the Preferred Securities, and (B) with respect to
Preferred Securities issued in definitive form and Common Securities,
provided, that the Note Issuer has paid the Property Trustee a sufficient
amount of cash in connection with the related redemption or maturity of the
Notes, the Property Trustee will pay the relevant Redemption Price to the
Holders of such Trust Securities by check mailed to the address of the
relevant Holder appearing on the books and records of the Trust on the
redemption date. If a Redemption/Distribution Notice shall have been given
and funds as deposited as
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<PAGE>
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 Trust Securities so called for
redemption and all rights of Holders of such Trust Securities so called for
redemption will cease, except the right of the Holders of such Trust
Securities to receive the Redemption Price, but without interest on such
Redemption Price. Neither the Regular Trustees nor the Trust shall be
required to register or cause to be registered the transfer of any Trust
Securities that have been so called for redemption. If any date fixed for
redemption of Trust Securities is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next succeeding
day that is a Business Day (and without any interest or other payment in
respect of any such delay) except that, if such Business Day falls in the
next calendar year, such payment will be made on the immediately preceding
Business Day, in each case with the same force and effect as if made on
such date fixed for redemption. If payment of the Redemption Price in
respect of any Trust Securities is improperly withheld or refused and not
paid either by the Property Trustee or by the Sponsor as guarantor pursuant
to the Preferred Securities Guarantee or Common Securities Guarantee, as
the case may be, Distributions on such Trust 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 purpose of calculating the Redemption Price.
(iv) Redemption/Distribution Notices shall be sent by the Regular
Trustees on behalf of the Trust to (A) in respect of the Preferred
Securities, the Depositary 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,
the Holders thereof.
(v) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities laws), provided the
acquirer is not a Holder of Common Securities or the obligor under the
Indenture, the Sponsor or any of its subsidiaries may at any time and from
time to time purchase outstanding Preferred Securities by tender, in the
open market or by private agreement.
5. VOTING RIGHTS - PREFERRED SECURITIES
(a) Except as provided under Paragraphs 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 liquidation amount of the Preferred Securities, voting separately
as a class, may direct the time, method, and place of
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conducting any proceeding for any remedy available to the Property Trustee, or
the exercise of any trust or power conferred upon the Property Trustee under the
Declaration, including (i) directing the time, method, and place of conducting
any proceeding for any remedy available to the Note Trustee, or exercising any
trust or power conferred on the Note Trustee with respect to the Notes, (ii)
waive any past default and its consequences that is waivable under Section 513
of the Indenture, or (iii) exercise any right to rescind or annul a declaration
that the principal of all the Notes shall be due and payable; provided,
--------
however, that, where a consent under the Notes would require the consent or
- -------
act of all of the holders of the Notes affected thereby, the Property Trustee
may only give such consent or take such action at the written direction of all
of the Holders of the Preferred Securities. The Property Trustee shall not
revoke any action previously authorized or approved by a vote of the Holders of
the Preferred Securities. Other than with respect to directing the time, method,
and place of conducting any remedy available to the Property Trustee or the Note
Trustee as set forth above, the Property Trustee shall not take any action in
accordance with the directions of the Holders of the Preferred Securities under
this paragraph 5(b) unless the Property 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 fail to be classified as a grantor trust on account of
such action. If the Property Trustee fails to enforce its rights under the
Declaration, any Holder of Preferred Securities, to the extent permitted under
applicable law, may institute a legal proceeding directly against any Person to
enforce the Property Trustee's rights under the Declaration without first
instituting a legal proceeding against the Property Trustee or any other Person.
Notwithstanding the foregoing, if a Declaration Event of Default has occurred
and is continuing and such event is attributable to the failure of the Note
Issuer to pay interest or principal on the Notes on the date such interest or
principal is otherwise payable (or in the case of redemption, on the redemption
date), then a Holder of Preferred Securities may directly institute a proceeding
for enforcement of payment to such Holder of the principal of or interest on the
Notes 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 Notes. 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 Notes.
Any approval or direction of Holders of Preferred Securities may be given
at a separate meeting of Holders of Preferred Securities convened for such
purpose, at a meeting of all of the Holders of Trust Securities in the Trust or
pursuant to written consent. The Regular Trustees will cause a notice of any
meeting at which Holders of Preferred Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to
be mailed to each Holder of record of Preferred Securities. Each such notice
will include a statement setting forth (i) the date of such meeting or the date
by which such action is to be taken, (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to vote
or of such matter upon which the written consent is sought, and (iii)
instructions for the delivery of proxies or consents.
A-8
<PAGE>
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 Notes in accordance with the Declaration and the terms of the
Trust Securities.
Notwithstanding that Holders of Preferred Securities are entitled to vote
or consent under any of the circumstances described above, any of the Preferred
Securities that are owned by the Sponsor or any Affiliate of the Sponsor shall
not be entitled to vote or consent and shall, for purposes of such vote or
consent, be treated as if they were not outstanding.
6. VOTING RIGHTS - COMMON SECURITIES.
(a) Except as provided under Paragraphs 6(b), 6(c) and 7, and as otherwise
required by law and the Declaration, the Holders of the Common Securities will
have no voting rights.
(b) The Holders of the Common Securities are entitled, in accordance with
Article V of the Declaration, to vote to appoint, remove or replace any Trustee
or to increase or decrease the number of Trustees.
(c) Subject to Section 2.6 of the Declaration and only after an 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 6(c), 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
Property Trustee, or the exercise of any trust or power conferred upon the
Property Trustee under the Declaration, including (i) directing the time,
method, and place of conducting any proceeding for any remedy available to the
Property Trustee, or exercising any trust or power conferred on the Property
Trustee with respect to the Notes, (ii) waive any past default and its
consequences that is waivable under Section 513 of the Indenture, or (iii)
exercise any right to rescind or annul a declaration that the principal of all
the Notes shall be due and payable, provided, however, that, where a consent or
-------- -------
action under the Indenture would require the consent or act of all of the
holders of the Notes affected thereby, the Property Trustee may only give such
consent or take such action at the written direction of all of the Holders of
the Common Securities. Pursuant to this Section 6(c), the Property Trustee
shall not revoke any action previously authorized or approved by a vote of the
Holders of the Preferred Securities. Pursuant to this Paragraph 6(c), the
Property Trustee shall not revoke any action previously authorized or approved
by a vote of the Holders of the Common Securities. Other than with respect to
directing the time, method, and place of conducting any remedy available to the
Property Trustee or the Note Trustee as set forth above, the Property Trustee
shall not take any action in accordance with the directions of the Holders of
the Common Securities under this paragraph unless the Property Trustee has
obtained an opinion of tax counsel to the effect that, for the purposes of
United States federal income tax, the Trust will not fail to be classified as a
grantor trust on account of such action. If the Property Trustee fails to
A-9
<PAGE>
enforce its rights under the Declaration, any Holder of Common Securities may,
after written request to the Property Trustee to enforce such rights, institute
a legal proceeding directly against any Person to enforce the Property Trustee's
rights under the Declaration, without first instituting a legal proceeding
against the Property 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 Trust 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 Notes
in accordance with the Declaration and the terms of the Trust 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 Trust 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 Trust Securities, as a
class, will be entitled to vote on such amendment or proposal (but not on any
other amendment or proposal) and such amendment or proposal shall not be
effective except with the approval of the Holders of at least a Majority in
liquidation amount of the Trust 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
Trust Securities.
(b) In the event the consent of the Property Trustee as the holder of the
Notes, the Preferred Securities Guarantee and the Common Securities Guarantee is
required under the Indenture with respect to any amendment, modification or
termination of the Indenture, the Notes, the Preferred Securities Guarantee, or
the Common Securities Guarantee, the Property Trustee shall request the
direction of the Holders of the Trust Securities with respect to such amendment,
modification or termination and shall vote with respect to such
A-10
<PAGE>
amendment, modification, or termination as directed by a Majority in liquidation
amount of the Trust Securities voting together as a single class; provided,
however, that where a consent under the Indenture would require the consent of
all of the holders of the Notes, the Property Trustee may only give such consent
at the direction of all of the Holders of the Trust Securities; provided,
further, that the Property Trustee shall not take any action in accordance with
the directions of the Holders of the Trust Securities under this Paragraph 7(b)
unless the Property 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 to any payment, distribution or treatment as being "Pro Rata"
shall mean pro rata to each Holder of Trust Securities according to the
aggregate liquidation amount of the Trust Securities held by the relevant Holder
in relation to the aggregate liquidation amount of all Trust Securities
outstanding unless, in relation to a payment, an Event of Default under the
Indenture has occurred and is continuing, in which case any funds available to
make such payment shall be paid first to each Holder of the Preferred Securities
pro rata according to the aggregate liquidation amount of Preferred Securities
held by the relevant Holder relative to the aggregate liquidation amount of all
Preferred Securities outstanding, and, only after satisfaction of all amounts
owed to the Holders of the Preferred Securities, to each Holder of Common
Securities pro rata according to the aggregate liquidation amount of Common
Securities held by the relevant Holder relative to the aggregate liquidation
amount of all Common Securities outstanding.
9. RANKING.
The Preferred Securities rank pari passu and payment thereon shall be made
Pro Rata with the Common Securities except that, where an Event of Default
occurs and is continuing under the Indenture in respect of the Notes held by the
Property Trustee, the rights of Holders of the Common Securities to payment in
respect of Distributions and payments upon liquidation, redemption and otherwise
are subordinated to the rights to payment of the Holders of the Preferred
Securities.
10. LISTING.
The Regular Trustees shall use their best efforts to cause the Preferred
Securities to be listed for quotation on the New York Stock Exchange.
11. ACCEPTANCE OF TRUST SECURITIES GUARANTEE AND INDENTURE.
Each Holder of Preferred Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein and to the provisions of the Indenture.
A-11
<PAGE>
12. NO PREEMPTIVE RIGHTS.
The Holders of the Trust Securities shall have no preemptive rights to
subscribe for any additional securities.
13. MISCELLANEOUS.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the Preferred
Securities Guarantee or the Common Securities Guarantee (as may be appropriate),
and the Indenture to a Holder without charge on written request to the Trust at
its principal place of business.
A-12
<PAGE>
ANNEX I
IF THE PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE INSERT
**[This Preferred Security is a Global Certificate within the meaning of
the Declaration hereinafter referred to and is registered in the name of The
Depository Trust Company, a New York corporation (the "Depositary") or a nominee
of the Depositary. This Preferred Security is exchangeable for Preferred
Securities registered in the name of a person other than the Depositary or its
nominee only in the limited circumstances described in the Declaration and no
transfer of this Preferred Security (other than a transfer of this Preferred
Security as a whole by the Depositary to a nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of the
Depositary) may be registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized representative
of the Depositary to the Trust or its agent for registration of transfer,
exchange or payment, and any Preferred Security issued is registered in the name
of Cede & Co. or such other name as is requested by an authorized representative
of the Depositary and any payment hereon is made to Cede & Co. or such other
entity as is requested by an authorized representative of the Depositary, ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.]
Certificate Number Number of Preferred Securities
CUSIP NO. 75952F 20 5
Certificate Evidencing Preferred Securities
of
RELIASTAR FINANCING II
Preferred Securities
(liquidation amount $25 per Preferred Security)
RELIASTAR FINANCING II, a statutory business trust formed under the laws of
the State of Delaware (the "Trust"), hereby certifies that
________________________ (the "Holder") is the registered owner of preferred
securities of the Trust representing undivided beneficial interests in the
assets of the Trust designated the 8.10% Trust Originated Preferred Securities
(liquidation amount $25 per Preferred Security) (the "Preferred Securities").
The Preferred Securities are transferable on the books and records of the Trust,
in person or by a duly authorized attorney, upon surrender of this certificate
duly endorsed and in proper form for transfer. The designation, rights,
privileges, restrictions, preferences and other terms and provisions of the
Preferred Securities represented hereby are issued and shall in all respects be
subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust dated as of June 3, 1997, as the same may be further
<PAGE>
amended from time to time (the "Declaration"), including the designation of the
terms of the Preferred Securities as set forth in Exhibit A to the Declaration.
Capitalized terms used herein but not defined shall have the meaning given them
in the Declaration.
The Holder is entitled to the benefits of the Preferred Securities
Guarantee to the extent provided therein. The Sponsor will provide a copy of
the Declaration, the Preferred Securities Guarantee and the Indenture to a
Holder without charge upon written request to the Trust at its principal place
of business.
Upon receipt of this certificate, the Holder is bound by the Declaration
and is entitled to the benefits thereunder.
By acceptance, the holder agrees to treat, for United States federal income
tax purposes, the Notes as indebtedness and the Preferred Securities as evidence
of indirect beneficial ownership in the Notes.
IN WITNESS WHEREOF, the Trust has executed this certificate this 3rd day
June, 1997.
Wayne R. Huneke
as Trustee
___________________________________________
Richard R. Crowl
as Trustee
___________________________________________
I-2
<PAGE>
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Preferred Security will be fixed at a rate
per annum of ______% (the "Coupon Rate") of the stated liquidation amount of
$25.00 per Preferred Security, such rate being the rate of interest payable on
the Notes to be held by the Property Trustee. Distributions in arrears for more
than one quarter will bear interest thereon compounded quarterly at the Coupon
Rate (to the extent permitted by applicable law). The term "Distributions" as
used herein includes such cash distributions and any such interest payable
unless otherwise stated. A Distribution is payable only to the extent that
payments are made in respect of the Notes held by the Property Trustee and to
the extent the Property 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 Distributions period for which
Distributions are computed, Distributions will be computed on a basis of the
actual number of days elapsed per 90-day quarter.
Except as otherwise described below, distributions on the Preferred
Securities will be cumulative, will accrue from the date of original issuance
and will be payable quarterly in arrears, on March 31, June 30, September 30 and
December 31 of each year, commencing on June 30, 1997, to Holders of record
____________ days prior to such payment dates, which payment dates shall
correspond to the interest payment dates on the Notes. The Note Issuer has the
right under the Indenture to defer payments of interest by extending the
interest payment period from time to time on the Notes for a period not
exceeding 20 consecutive quarters (each an "Extension Period") and, as a
consequence of such deferral, 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. Prior to the termination of any
such Extension Period, the Note 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. 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 Note Issuer may commence a new Extension Period, subject to the above
requirements.
The Preferred Securities shall be redeemable as provided in the
Declaration.
I-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)
I-4
<PAGE>
ANNEX II
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
RELIASTAR FINANCING II
Common Securities
(liquidation amount $25 per Common Security)
RELIASTAR FINANCING II, a statutory business trust formed under the laws of
the State of Delaware (the "Trust"), hereby certifies that ReliaStar Financial
Corp. (the "Holder") is the registered owner of common securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the 8.10% Trust Originated Common Securities (liquidation amount $25
per Common Security) (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. 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 June 3, 1997,
as the same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Common Securities as set forth in Exhibit A to
the Declaration. Capitalized terms used herein but not defined shall have the
meanings given them in the Declaration.
The Trust will provide a copy of the Declaration, the Common Securities
Guarantee and the Indenture to the Holder without charge upon written request to
the Trust at its principal place of business.
Upon receipt of this certificate, the Sponsor is bound by the Declaration
and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat for United States federal income
tax purposes the Notes as indebtedness and the Common Securities as evidence of
indirect beneficial ownership in the Notes.
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate this ____day of
____________, 1997.
Wayne R. Huneke
as Trustee
__________________________________
Richard R. Crowl
as Trustee
__________________________________
II-2
<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)
II-3
<PAGE>
EXHIBIT 4(r)
________________________________________________________________________________
RELIASTAR FINANCIAL CORP.
TO
Wilmington Trust Company, as Trustee
______________________________
SECOND SUPPLEMENTAL INDENTURE
Dated as of June 3, 1997
8.10% Subordinated Deferrable
Interest Notes Due June 3, 2027
________________________________________________________________________________
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I Definitions......................................................... 2
ARTICLE II General Terms and Conditions of the Notes.......................... 3
Section 2.1 Designation and Principal Amount............................. 3
Section 2.2 Maturity..................................................... 3
Section 2.3 Form and Payment............................................. 4
Section 2.4 Global Security.............................................. 4
Section 2.5 Interest..................................................... 5
Section 2.6 Authorized Denominations..................................... 6
Section 2.7 Conversion................................................... 7
Section 2.8 Paying Agent and Authenticating Agent........................ 7
ARTICLE III Redemption of the Notes........................................... 7
Section 3.1 Special Event Redemption..................................... 7
Section 3.2 Optional Redemption by Company............................... 7
Section 3.3 No Sinking Fund.............................................. 8
Section 3.4 No Repayment................................................. 8
ARTICLE IV Extension of Interest Payment Period............................... 8
Section 4.1 Extension of Interest Payment Period......................... 8
Section 4.2 Notice of Extension.......................................... 9
ARTICLE V Expenses............................................................10
ARTICLE VI Additional Events of Default and Covenants.........................10
Section 6.1 Events of Default............................................10
Section 6.2 Covenants....................................................11
ARTICLE VII No Defeasance.....................................................12
ARTICLE VIII Form of Note.....................................................12
ARTICLE IX Original Issue of Notes............................................19
Section 9.1 Original Issue of Notes......................................19
Section 9.2 Reports by the Trustee.......................................20
ARTICLE X Limitation on Waivers and Consents..................................20
ARTICLE XI Miscellaneous......................................................20
Section 11.1 Ratification of Indenture...................................20
Section 11.2 Trustee Not Responsible for Recitals........................20
Section 11.3 Governing Law...............................................21
Section 11.4 Separability................................................21
Section 11.5 Counterparts................................................21
Section 11.6 Third Party Beneficiaries...................................21
</TABLE>
i
<PAGE>
SECOND SUPPLEMENTAL INDENTURE, dated as of June 3, 1997 (the "Second
Supplemental Indenture"), between ReliaStar Financial Corp., a Delaware
corporation (the "Company"), and Wilmington Trust Company not in its individual
capacity but solely as trustee (the "Trustee") under the Indenture dated as of
March 29, 1996 between the Company and the Trustee, as amended by the First
Supplemental Indenture dated March 29, 1996 (the "Indenture").
RECITALS OF THE COMPANY
WHEREAS, the Company executed and delivered the Indenture to the Trustee to
provide for the future issuance of the Company's unsecured junior subordinated
debt securities to be issued from time to time in one or more series as might be
determined by the Company under the Indenture, in an unlimited aggregate
principal amount, which may be authenticated and delivered as provided in the
Indenture;
WHEREAS, pursuant to the terms of the Indenture, the Company desires to
provide for the establishment of a new series of its Debt Securities to be known
as its 8.10% Junior Subordinated Deferrable Interest Notes due June 3, 2027 (the
"Notes"), the form and substance of such Notes and the terms, provisions and
conditions thereof to be set forth as provided in the Indenture and this Second
Supplemental Indenture;
WHEREAS, ReliaStar Financing II, a Delaware statutory business trust (the
"Trust"), has offered to the public $125 million aggregate liquidation amount of
its 8.10% Trust Originated Preferred Securities (the "Preferred Securities"),
representing undivided beneficial interests in the assets of the Trust and
proposes to invest the proceeds from such offering in $125 million aggregate
principal amount of the Notes;
WHEREAS, the Company has requested that the Trustee execute and deliver
this Second Supplemental Indenture; and
WHEREAS, all requirements necessary to make this Second Supplemental
Indenture a valid instrument in accordance with its terms and to make the Notes,
when executed by the Company and authenticated and delivered by the Trustee, the
valid obligations of the Company have been performed, and execution and delivery
of this Second Supplemental Indenture have been duly authorized in all respects;
NOW THEREFORE, in consideration of the purchase and acceptance of the Notes
by the Holders thereof, and for the purpose of setting forth, as provided in the
Indenture, the form and substance of the Notes and the terms, provisions and
conditions thereof, the Company covenants and agrees with the Trustee as
follows:
<PAGE>
ARTICLE I
DEFINITIONS
Unless the context otherwise requires:
(a) a term defined in the Indenture has the same meaning when used in this
Second Supplemental Indenture;
(b) a term defined anywhere in this Second Supplemental Indenture has the
same meaning throughout;
(c) the singular includes the plural and vice versa;
(d) a reference to a Section or Article is to a Section or Article of this
Second Supplemental Indenture;
(e) headings are for convenience of reference only and do not affect
interpretation;
(f) the following terms have the meanings given to them in the Declaration:
(i) Business Day; (ii) Common Securities; (iii) Delaware Trustee; (iv)
Depositary; (v) Dissolution Tax Opinion; (vi) Distribution; (vii) Ministerial
Action; (viii) No Recognition Opinion; (ix) Preferred Securities Certificates;
(x) Preferred Securities Guarantee; (xi) Property Trustee; (xii) Redemption Tax
Opinion; (xiii) Regular Trustees; (xiv) Tax Event; and (xv) Trust Securities;
and
(g) the following terms have the meanings given to them in this Section
1.l(g):
"Additional Interest" has the meaning given such term in Section 2.5(c).
-------------------
"Compounded Interest" has the meaning given such term in Section 4.l.
-------------------
"Coupon Rate" has the meaning given such term in Section 2.5 (a).
-----------
"Declaration" means the Declaration of Trust dated as of May 8, 1997
-----------
executed by the Company, as sponsor, and the trustees of the Trust and the
holders from time to time of undivided beneficial interests in the Trust, as
amended.
"Deferred Interest" means Additional Interest and Compounded Interest.
-----------------
"Dissolution Event" means that as a result of the occurrence and
-----------------
continuation of a Tax Event, the Trust is to be dissolved in accordance with the
Declaration, and the Notes held by the Property Trustee are to be distributed to
the holders of the Trust Securities issued by the Trust pro rata in accordance
with the Declaration.
2
<PAGE>
"Extended Interest Payment Period" has the meaning given such term in
--------------------------------
Section 4.1.
"Maturity Date" means the date on which the Notes mature and on which the
-------------
principal shall be due and payable together with all accrued and unpaid interest
thereon, including Deferred Interest, if any.
"90 Day Period" has the meaning given to such term in Section 3.1.
-------------
"Non Book-Entry Preferred Securities" has the meaning given such term in
-----------------------------------
Section 2.4(a).
"Redemption Price" has the meaning given to such term in Section 3.1.
----------------
"Reporting Date" means that date that is one year from the date first
--------------
written herein and each one year anniversary of such date thereafter.
"Stated Maturity Date" means June 3, 2027.
--------------------
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE NOTES
Section 2.1 Designation and Principal Amount.
There is hereby authorized a series of Debt Securities designated the
"8.10% Junior Subordinated Deferrable Interest Notes due June 3, 2027", limited
in aggregate principal amount to $128,865,979.40 (except for Debt Securities of
such series authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Debt Securities of such series pursuant to
Sections 304, 305, 306, 906 or 1303 of the Indenture), which amount shall be as
set forth in a Company Order for the authentication and delivery of the Notes
pursuant to Section 303 of the Indenture.
Section 2.2 Maturity.
The Maturity Date will be the Stated Maturity Date provided that the
Company may at its option at any time prior to the Stated Maturity Date extend
the Maturity Date to a date not later than June 3, 2046; provided, however, that
-------- -------
at the time such election is made and at the effective time of such extension
(as specified by the Company) (i) the Company is not in bankruptcy, otherwise
insolvent or in liquidation, (ii) the Company is not in default in the payment
of any interest or principal on the Notes, and (iii) in the case of Notes held
by the Trust, the Trust is not in arrears on payments of Distributions and no
deferred Distributions are accumulated. In the event the Company elects to
extend the stated maturity of the Notes,
3
<PAGE>
it shall give notice of any such change to the Trustee, and the Trustee shall
give notice of such extension to the Holders of the Notes, not more than 90 and
not less than 30 days prior to the effective time of such extension.
Section 2.3 Form and Payment.
Except as provided in Section 2.4, the Notes shall be issued as Registered
Securities in fully registered certificated form without interest coupons.
Principal and interest on the Notes issued in certificated form will be payable,
the transfer of such Notes will be registrable and such Notes will be
exchangeable for Notes bearing identical terms and provisions at the office or
agency of the Trustee in the City of Wilmington, Delaware; provided, however,
-------- -------
that payment of interest may be made at the option of the Company by check
mailed to the Holder at such address as shall appear in the Security Register or
by wire transfer to such account as may have been appropriately designated by
such Holder. Notwithstanding the foregoing, so long as the Holder of any Notes
is the Property Trustee, the payment of the principal of and interest, including
Deferred Interest, if any, on such Notes held by the Property Trustee will be
made at such place and to such account as may be designated by the Property
Trustee. The Notes will be denominated in U.S. dollars and payments of
principal and interest on the Notes shall be made in U.S. dollars.
Section 2.4 Global Security.
(a) In connection with a Dissolution Event, the Notes in certificated form
may be presented to the Trustee by the Property Trustee in exchange for a global
Note in an aggregate principal amount equal to all Outstanding Debt Securities
of such series (a "Global Security") to be registered in the name of the
Depositary, or its nominee, and delivered by the Trustee to the Depositary for
crediting to the accounts of its participants pursuant to the instructions of
the Regular Trustees. The Company upon any such presentation shall execute a
Global Security in such aggregate principal amount and deliver the same to the
Trustee for authentication and delivery in accordance with the Indenture and
this Second Supplemental Indenture. Payments on the Notes issued as a Global
Security will be made to the Depositary.
If any Preferred Securities are held in non book-entry certificated form,
the Notes in certificated form may be presented to the Trustee by the Property
Trustee and any Preferred Security Certificate which represents Preferred
Securities other than Preferred Securities held by the Depositary or its nominee
("Non Book-Entry Preferred Securities") will be deemed to represent beneficial
interests in Notes presented to the Trustee by the Property Trustee having an
aggregate principal amount equal to the aggregate liquidation amount of the Non
Book-Entry Preferred Securities until such Preferred Security Certificates are
presented to the Security Registrar for transfer or reissuance at which time
such Preferred Security Certificates will be canceled, and a Note registered in
the name of the holder of the Preferred Security Certificate or the transferee
of the holder of such Preferred Security Certificate, as the case may be, with
an aggregate principal amount equal to the aggregate liquidation amount of the
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Preferred Security Certificate canceled will be executed by the Company and
delivered to the Trustee together with a Company Order for authentication and
delivery in accordance with the Indenture and this Second Supplemental
Indenture. On issue of such Notes, Notes with an equivalent aggregate principal
amount that were presented by the Property Trustee to the Trustee will be deemed
to have been canceled.
(b) A Global Security may be transferred, in whole but not in part, only to
another nominee of the Depositary, or to a successor Depositary selected or
approved by the Company or to a nominee of such successor Depositary.
(c) If at any time the Depositary notifies the Company that it is unwilling
or unable to continue as Depositary or if at any time the Depositary for such
series shall no longer be registered or in good standing under the Securities
Exchange Act of 1934, as amended, or other applicable statute or regulation, and
a successor Depositary for such series is not appointed by the Company within 90
days after the Company receives such notice or becomes aware of such condition,
as the case may be, the Company, in its sole discretion, determines that the
Global Security shall be exchangeable for definitive registered securities or if
an Event of Default shall have occurred, the Company will execute and, subject
to Article Two of the Indenture, the Trustee will authenticate and deliver the
Notes in definitive registered form without coupons, in authorized
denominations, and in an aggregate principal amount equal to the principal
amount of the Global Security in exchange for such Global Security. In
addition, the Company may at any time determine that the Notes shall no longer
be represented by a Global Security. In such event the Company will execute
and, subject to Article Two of the Indenture, the Trustee will authenticate and
deliver the Notes in definitive registered form without coupons, in authorized
denominations, and in a principal amount equal to the principal amount of the
Global Security in exchange for such Global Security. Upon the exchange of the
Global Security for such Notes in definitive registered form without coupons, in
authorized denominations, the Global Security shall be canceled by the Trustee.
Such Notes in definitive registered form issued in exchange for the Global
Security shall be registered in such names and in such authorized denominations
as the Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee in writing. The Trustee
shall deliver such Notes to the Depositary for delivery to the Persons in whose
names such Notes are so registered.
(d) If any Debt Securities of this series are issued in global form, the
U.S. Depositary for such global Debt Securities shall be The Depository Trust
Company, or any successor to such U.S. Depositary appointed pursuant to the
Indenture.
Section 2.5 Interest.
(a) Each Note will bear interest at the rate of 8.10% per annum (the
"Coupon Rate") from the original date of issuance until the principal thereof
becomes due and payable, and on any overdue principal and (to the extent that
payment of such interest is enforceable
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under applicable law) on any overdue installment of interest at the Coupon Rate,
compounded quarterly, payable (subject to the provisions of Article IV)
quarterly in arrears on each Interest Payment Date, commencing on June 30, 1997,
to the Person in whose name such Note or any Predecessor Security is registered,
at the close of business on the Regular Record Date for such interest
installment, which, in respect of any Notes of which the Property Trustee is the
Holder or a Global Security, shall be the close of business on the Business Day
next preceding that Interest Payment Date. Notwithstanding the foregoing
sentence, if the Preferred Securities are no longer in book-entry only form or
if pursuant to the Indenture the Notes are not represented by a Global Security,
the Company may select a Regular Record Date for such interest installment which
shall be any date at least one Business Day before an Interest Payment Date. The
Interest Payment Dates for the Notes shall be March 31, June 30, September 30
and December 31.
(b) The amount of interest payable for any period will be computed on the
basis of a 360-day year of twelve 30-day months. Except as provided in the
following sentence, the amount of interest payable for any period shorter than a
full quarterly period for which interest is computed will be computed on the
basis of the actual number of days elapsed in such a 30-day month. In the event
that any date on which interest is payable on the Notes is not a Business Day,
then payment of the interest payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay), except that, notwithstanding the
provisions of Section 113 of the Indenture, 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.
(c) If, at any time while the Property Trustee is the Holder of any Notes,
the Trust or the Property Trustee, on behalf of the Trust, is required to pay
any taxes, duties, assessments or governmental charges of whatever nature (other
than withholding taxes) imposed by the United States, or any other taxing
authority, then, in any such case, the Company will pay as additional interest
("Additional Interest") on the Notes held by the Property Trustee, on behalf of
the Trust, such additional amounts as shall be required so that the net amounts
received and retained by the Trust and the Property Trustee, on behalf of the
Trust, after paying such taxes, duties, assessments or other governmental
charges will be equal to the amounts the Trust and the Property Trustee, on
behalf of the Trust, would have received had no such taxes, duties, assessments
or other governmental charges been imposed.
Section 2.6 Authorized Denominations.
The Notes shall be issuable in denominations of $25 and integral multiples
of $25 in excess thereof.
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Section 2.7 Conversion.
The Notes are not subject to conversion at the option of the Holder or
otherwise.
Section 2.8 Paying Agent and Authenticating Agent.
Wilmington Trust Company is hereby appointed as Paying Agent and Security
Registrar for the Notes, and the appointment of Wilmington Trust Company as
Authenticating Agent is hereby ratified and approved.
ARTICLE III
REDEMPTION OF THE NOTES
Section 3.1 Special Event Redemption.
If a Tax Event has occurred and is continuing and:
(a) the Company has received a Redemption Tax Opinion; or
(b) after receiving a Dissolution Tax Opinion, the Regular Trustees shall
have been informed by tax counsel rendering the Dissolution Tax Opinion that a
No Recognition Opinion cannot be delivered to the Trust, then, notwithstanding
Section 3.2(a) but subject to Section 3.2(b), the Company shall have the right,
upon not less than 30 days nor more than 60 days notice to the Holders of the
Notes, to redeem the Notes in whole or in part for cash at a redemption price
equal to 100% of the principal amount to be redeemed plus any accrued and unpaid
interest thereon to the date of such redemption (the "Redemption Price") within
90 days following the occurrence of such Tax Event (the "90 Day Period");
provided, however, that, if at the time there is available to the Company the
- -----------------
opportunity to eliminate, within the 90 Day Period, the Tax Event by taking some
Ministerial Action, the Company shall pursue such Ministerial Action in lieu of
redemption; and provided, further, that the Company shall have no right to
-------- -------
redeem the Notes while the Trust is pursuing any Ministerial Action pursuant to
its obligations under the Declaration. The Redemption Price shall be paid prior
to 12:00 noon, New York time, on the Redemption Date or such earlier time as the
Company determines, provided that the Company shall deposit with the Trustee an
amount sufficient to pay the Redemption Price by 10:00 a.m., New York time, on
the date such Redemption Price is to be paid.
Section 3.2 Optional Redemption by Company.
(a) Subject to the provisions of Section 3.2(b) and to the provisions of
Article Eleven of the Indenture, except as otherwise specified in this Second
Supplemental Indenture, the Company shall have the right to redeem the Notes, in
whole or in part, from
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time to time, on or after June 3, 2002, at the Redemption Price. Any redemption
pursuant to this paragraph will be made upon not less than 30 nor more than 60
days' notice to the Holders of the Notes, at the Redemption Price. If the Notes
are only partially redeemed pursuant to this Section 3.2, the Notes will be
redeemed pro rata or by lot or by any other method utilized by the Trustee;
provided, however, that, if at the time of redemption the Notes are registered
- -------- -------
as a Global Security, the Depositary shall determine the principal amount of
such Notes credited to each of its participant accounts to be redeemed. The
Redemption Price shall be paid prior to 12:00 noon, New York time, on the
Redemption Date or at such earlier time as the Company determines, provided that
the Company shall deposit with the Trustee an amount sufficient to pay the
Redemption Price by 10:00 a.m., New York time, on the date such Redemption Price
is to be paid.
(b) If a partial redemption of the Notes would result in the delisting of
the Preferred Securities issued by the Trust from any national securities
exchange or other organization on which the Preferred Securities are then
listed, the Company shall not be permitted to effect such partial redemption and
may only redeem the Notes in whole.
Section 3.3 No Sinking Fund.
The Notes are not entitled to the benefit of any sinking fund.
Section 3.4 No Repayment.
The Notes are not subject to repayment at the option of the Holders.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
Section 4.1 Extension of Interest Payment Period.
The Company shall have the right, at any time during the term of the Notes,
from time to time, to defer payments of interest by extending the interest
payment period of such Notes for up to 20 consecutive quarters (the "Extended
Interest Payment Period"); provided, that during any such Extended Interest
Payment Period, (a) the Company shall not declare or pay dividends on, make any
distribution with respect to, or redeem, purchase, acquire or make a liquidation
payment with respect to any of its capital stock, and (b) the Company shall not
make any payment of interest, principal or premium, if any, on or repay,
repurchase or redeem any debt securities issued by the Company that rank pari
passu with or junior to the Notes. To the extent permitted by applicable law,
interest, the payment of which has been deferred because of the extension of the
interest payment period pursuant to this Section 4.1, will bear interest thereon
at the Coupon Rate compounded quarterly for each quarter of the Extended
Interest Payment Period ("Compounded Interest"). At the end of the Extended
Interest
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Payment Period the Company shall pay all interest accrued and unpaid on the
Notes, including any Deferred Interest that shall be payable, to the Holders of
the Notes in whose names the Notes are registered in the Security Register on
the first Regular Record Date after the end of the Extended Interest Payment
Period. Before the termination of any Extended Interest Payment Period, the
Company may further extend such period, provided that such period together with
all such further extensions thereof shall not exceed 20 consecutive quarters.
Upon the termination of any Extended Interest Payment Period and upon the
payment of all Deferred Interest then due, the Company may commence a new
Extended Interest Payment Period, subject to the foregoing requirements. No
interest shall be due and payable during an Extended Interest Payment Period,
except at the end thereof.
Section 4.2 Notice of Extension.
(a) If the Property Trustee is the only registered Holder of the Notes at
the time the Company selects an Extended Interest Payment Period, the Company
shall give written notice to the Regular Trustees, the Property Trustee, the
Delaware Trustee and the Trustee of its selection of such Extended Interest
Payment Period one Business Day before the earlier of (a) the next succeeding
date on which Distributions on the Trust Securities issued by the Trust are
payable, or (b) the date the Trust is required to give notice of the record date
or the date such Distributions are payable to the New York Stock Exchange or
other applicable self-regulatory organization or to holders of the Preferred
Securities issued by the Trust, but in any event at least one Business Day
before such record date.
(b) If the Property Trustee is not the only Holder of the Notes at the time
the Company selects an Extended Interest Payment Period, the Company shall give
the Holders of the Notes and the Trustee written notice of its selection of such
Extended Interest Payment Period 10 Business Days before the earlier of (i) the
next succeeding Interest Payment Date, or (ii) the date the Company is required
to give notice of the Regular Record Date or Interest Payment Date of such
interest payment to the New York Stock Exchange or other applicable self-
regulatory organization or to Holders of the Notes.
(c) The quarter in which any notice is given pursuant to paragraphs (a) or
(b) of this Section 4.2 shall be counted as one of the 20 quarters permitted in
the maximum Extended Interest Payment Period permitted under Section 4.1.
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ARTICLE V
EXPENSES
In connection with the offering, sale and issuance of the Notes to the
Property Trustee in connection with the sale of the Trust Securities by the
Trust, the Company shall:
(a) pay all costs and expenses relating to the offering, sale and issuance
of the Notes, including compensation of the Trustee under the Indenture in
accordance with the provisions of Section 607 of the Indenture;
(b) pay any and all taxes (other than United States withholding taxes
attributable to the Trust or its assets) and all liabilities, costs and expenses
with respect to such taxes of the Trust; and
(c) pay all other debts and obligations of the Trust (other than with
respect to the Trust Securities) and all costs and expenses of the Trust
(including, but not limited to, costs and expenses relating to the organization
of the Trust, the fees and expenses of the Property Trustee, the trustee under
the Preferred Securities Guarantee and the Delaware Trustee, the costs and
expenses relating to the operation of the Trust, including, without limitation,
costs and expenses of accountants, attorneys, statistical or bookkeeping
services, expenses of printing and engraving and computing or accounting
equipment, paying agent(s), registrar(s), transfer agent(s), duplicating, travel
and telephone and other telecommunications expenses and costs and expenses
incurred in connection with the acquisition, financing, and disposition of Trust
assets).
ARTICLE VI
ADDITIONAL EVENTS OF DEFAULT AND COVENANTS
Section 6.1 Events of Default.
In addition to the Events of Default set forth in the Indenture, an "Event
of Default," whenever used in the Indenture, this Second Supplemental Indenture
or the Notes, shall include the voluntary or involuntary dissolution or winding
up of the business of the Trust or other termination of the existence of the
Trust, other than in connection with (i) the distribution of the Notes to
holders of the Trust Securities in liquidation of their interests in the Trust,
(ii) the redemption of all of the outstanding Trust Securities, or (iii) certain
mergers, consolidations or amalgamations, each as permitted by the Declaration.
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Section 6.2 Covenants.
In addition to the covenants set forth in Article X of the Indenture, the
following covenants shall apply to the Notes:
(a) Limitation on Dividends; Transactions with Affiliates.
If (i) there shall have occurred any event that would constitute an
Event of Default, (ii) the Company shall be in default with respect to its
payment of any obligations under the Preferred Securities Guarantee
relating to the Trust or (iii) the Company shall have given notice of its
election to defer payments of interest on the Notes by extending the
interest payment period as provided herein 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 or make a liquidation payment with respect to any of its
capital stock, and (B) the Company shall not make any payment of interest,
principal 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
the Notes; provided, however, that restriction (A) above does not apply to
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any stock dividends paid by the Company where the dividend stock is the
same as that on which the dividend is being paid.
(b) Covenants as to the Trust.
For so long as the Trust Securities remain outstanding, the Company
will (i) maintain 100% direct or indirect ownership of the Common
Securities, provided, however, that any permitted successor of the Company
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under the Indenture may succeed to the Company's ownership of the Common
Securities, (ii) use its reasonable efforts to cause the Trust (a) to
remain a business trust, except in connection with a distribution of the
Notes, the redemption of all of the Trust Securities or certain mergers,
consolidations or amalgamations, each as permitted by the Declaration, and
(b) to otherwise continue not to be treated as an association taxable as a
corporation or partnership for United States federal income tax purposes,
and (iii) to use its reasonable efforts to cause each holder of Trust
Securities to be treated as owning an individual beneficial interest in the
Notes.
(c) Acknowledgment of Rights of Holders of Preferred Securities.
The Company acknowledges that, with respect to any Notes held by the
Trust or a trustee of the Trust, if the Property Trustee fails to enforce
its rights under the Indenture and this Second Supplemental Indenture as
the Holder of the Notes held as the assets of the Trust, any holder of
Preferred Securities may, to the extent permitted by applicable law,
institute legal proceedings directly against the Company to enforce such
Property Trustee's rights under the Indenture and this Second Supplemental
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Indenture without first instituting any legal proceedings against such
Property Trustee or any other person or entity. Notwithstanding the
foregoing, if an Event of Default has occurred and is continuing and such
event is attributable to the failure of the Company to pay interest or
principal on the Notes on the date such interest or principal is otherwise
payable (or in the case of redemption, on the Redemption Date), the Company
acknowledges that a holder of Preferred Securities may directly institute a
proceeding for enforcement of payment to such holder of the principal of or
interest on the Notes 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 Notes.
(d) Listing of Notes.
If the Notes are to be issued as a Global Security in connection with
the distribution of the Notes to the holders of the Preferred Securities
issued by the Trust upon a Dissolution Event, the Company will, if the
Notes are not already so listed, use its best efforts to list such Notes on
the New York Stock Exchange or on such other national securities exchange,
the Nasdaq National Market or other organization on which the Preferred
Securities are then listed.
ARTICLE VII
NO DEFEASANCE
The Notes shall not be subject to defeasance as set forth in Section 403 or
Article XV of the Indenture.
ARTICLE VIII
FORM OF NOTE
The Notes and the Trustee's Certificate of Authentication to be endorsed
thereon are to be substantially in the following forms:
(FORM OF FACE OF NOTE)
[**IF THE NOTE IS TO BE A GLOBAL SECURITY, INSERT - This Debt Security is a
Global Security within the meaning of the Indenture hereinafter referred to and
is registered in the name of a Depositary or a nominee of a Depositary. This
Debt Security is exchangeable for Global Securities registered in the name of a
person other than the Depositary or its nominee only in the limited
circumstances described in the Indenture, and no transfer of this Debt Security
(other than a transfer of this Debt Security as a whole by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary or another
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nominee of the Depositary) may be registered except in limited circumstances.
Every Debt Security delivered upon registration of transfer of, or in exchange
for, or in lieu of this Global Security shall be a Global Security, subject to
the foregoing, except in the limited circumstances described above.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or in such other name as
requested by an authorized representative of DTC (or to such other entity as is
requested by an authorized representative of DTC) and any payment is made to
Cede & Co. (or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof,
Cede & Co., has an interest herein.]
No. _________________
$____________________
8.10% JUNIOR SUBORDINATED DEFERRABLE INTEREST NOTE
DUE June 3, 2027
ReliaStar Financial Corp., a Delaware corporation (the "Company", which
term includes any successor corporation under the Indenture hereinafter referred
to), for value received, hereby promises to pay to ReliaStar Financing II, or
registered assigns, the sum of ____________ Dollars on June 3, 2027, or, at the
Company's election, on a date no later than June 3, 2046, and to pay interest on
said principal sum from June 3, 1997, or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, quarterly (subject to
deferral as set forth herein) in arrears on March 31, June 30, September 30 and
December 31 of each year commencing June 30, 1997, at the rate of 8.10% per
annum until the principal hereof shall have become due and payable, and on any
overdue principal and (without duplication and to the extent that payment of
such interest is enforceable under applicable law) on any overdue installment of
interest at the same rate per annum compounded quarterly. The amount of
interest payable on any Interest Payment Date shall be computed on the basis of
a 360-day year of twelve 30-day months. In the event that any date on which
interest is payable on this Debt Security is not a Business Day, then payment of
interest payable on such date will be made on the next succeeding day that is a
Business Day, except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on such date. The
interest installment so payable, and punctually paid or
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duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Debt Security or one or more
Predecessor Securities is registered at the close of business on the Regular
Record Date for such interest installment, which shall be the close of business
on the Business Day next preceding such Interest Payment Date [**IF PURSUANT TO
THE PROVISIONS OF THE INDENTURE THE DEBT SECURITIES ARE NO LONGER REPRESENTED BY
A GLOBAL SECURITY [**OR IF THE PROPERTY TRUSTEE IS NOT THE HOLDER] - which shall
be the close of business on the Business Day next preceding such Interest
Payment Date.] Any such interest installment not punctually paid or duly
provided for shall forthwith cease to be payable to the registered Holders on
such Regular Record Date and may be paid to the Person in whose name this Debt
Security or one or more Predecessor Securities is registered at the close of
business on a Special Record Date to be fixed by the Trustee for the payment of
such Defaulted Interest, notice whereof shall be given to the registered Holders
of this series of Debt Securities not less than 10 days prior to such Special
Record Date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the Debt
Securities of this series may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in the Indenture. The principal of
and the interest on this Debt Security shall be payable at the office or agency
of the Trustee maintained for that purpose in Wilmington, Delaware in any coin
or currency of the United States of America that at the time of payment is legal
tender for payment of public and private debts; provided, however, that at the
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option of the Company payment of interest may be made by check mailed to the
registered Holder at such address as shall appear in the Security Register or by
wire transfer to such account as may have been appropriately designated by such
Holder. Notwithstanding the foregoing, so long as the Holder of this Debt
Security is the Property Trustee, the payment of the principal of and interest
on this Debt Security will be made at such place and to such account as may be
designated by the Property Trustee.
The indebtedness evidenced by this Debt Security is, to the extent provided
in the Indenture, subordinate and junior in right of payment to the prior
payment in full of all Senior Debt and shall be pari passu with all Trust
Related Securities (defined to mean the obligations evidenced by debt securities
(and guaranties in respect of those debt securities) initially issued to any
trust, or trustee of a trust, partnership or other entity affiliated with the
Company that is, directly or indirectly, a financing vehicle of the Company in
connection with the issuance by such entity of preferred securities or other
similar securities), and this Debt Security is issued subject to the provisions
of the Indenture with respect thereto. Each Holder of this Debt Security, by
accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his or her behalf to take such action as
may be necessary or appropriate to acknowledge or effectuate the subordination
so provided, and (c) appoints the Trustee his or her attorney-in-fact for any
and all such purposes. Each Holder hereof, by his or her acceptance hereof,
hereby waives all notice of the acceptance of the subordination provisions
contained herein and in the Indenture by each holder of Senior Debt, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon
said provisions.
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This Debt Security shall not be entitled to any benefit under the Indenture
hereinafter referred to, or be valid or become obligatory for any purpose, until
the Certificate of Authentication hereon shall have been signed by or on behalf
of the Trustee.
The provisions of this Debt Security are continued on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument to be executed.
Dated: June 3, 1997
RELIASTAR FINANCIAL CORP.
By___________________________________________
Attest:
By ____________________________
Secretary
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series of Debt Securities
described in the within-mentioned Indenture.
WILMINGTON TRUST COMPANY, or ____________________________
not in its individual capacity but solely as Authentication Agent
as Trustee
By _______________________ By ______________________
Authorized Signatory Authorized Signatory
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(FORM OF REVERSE OF NOTE)
This Debt Security is one of a duly authorized series of debt securities of
the Company (herein sometimes referred to as the "Debt Securities"), specified
in the Indenture, all issued or to be issued in one or more series under and
pursuant to an Indenture dated as of March 29, 1996, duly executed and delivered
between the Company and Wilmington Trust Company, as Trustee (the "Trustee"), as
supplemented by the First Supplemental Indenture dated as of March 29, 1996 and
the Second Supplemental Indenture dated as of June 3, 1997, between the Company
and the Trustee (as so supplemented, the "Indenture"), to which Indenture and
all indentures supplemental thereto reference is hereby made for a description
of the rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Company and the Holders of the Debt Securities.
By the terms of the Indenture, the Debt Securities are issuable in series that
may vary as to amount, date of maturity, rate of interest and in other respects
as provided in the Indenture. This Debt Security is one of the series
designated on the face hereof, limited in aggregate principal amount to
$128,865,979.40.
The Maturity Date of this Debt Security will be June 3, 2027, provided that
the Company may at its option at any time prior to such date extend the Maturity
Date to a date not later than June 3, 2046; provided, however, that at the time
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such election is made and at the effective time of such extension (as specified
by the Company) (i) the Company is not in bankruptcy, otherwise insolvent or in
liquidation, (ii) the Company is not in default in the payment of any interest
or principal on the Debt Securities of this series, and (iii) in the case of
Debt Securities of this series held by the Trust, the Trust is not in arrears of
payments of Distributions on the Preferred Securities, and no deferred
Distributions on the Preferred Securities are accumulated. In the event the
Company elects to extend the stated maturity of the Debt Securities of this
series, it shall give notice of any such change to the Trustee, and the Trustee
shall give notice of such extension to the Holders of the Debt Securities of
this series, not more than 90 and not less than 30 days prior to the effective
time of such extension.
Upon the occurrence and continuation of a Tax Event, in certain
circumstances, this Debt Security will become due and payable at a price equal
to 100% of the principal amount hereof plus any accrued but unpaid interest to
the Redemption Date (the "Redemption Price"). The Redemption Price shall be
paid prior to 12:00 noon, New York time, on the Redemption Date or at such
earlier time as the Company determines. The Company shall also have the right
to redeem this Debt Security at the option of the Company, without premium or
penalty, in whole or in part at any time on or after June 3, 2002 (an "Optional
Redemption") or at any time in certain circumstances upon the occurrence of a
Tax Event, at the Redemption Price. Any redemption pursuant to this paragraph
will be made upon not less than 30 nor more than 60 days notice at the
Redemption Price. If the Debt Securities of this series are only partially
redeemed by the Company pursuant to an Optional Redemption, the Debt Securities
of this series will be redeemed pro rata or by lot or by any other method
utilized by the Trustee; provided, however, that if, at the time of redemption,
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the Debt Securities of this series are
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registered as a Global Security, the Depositary shall determine the principal
amount of such Debt Securities credited to each of its participant accounts to
be redeemed.
In the event of redemption of this Debt Security in part only, a new Debt
Security or Debt Securities of this series for the unredeemed portion hereof
will be issued in the name of the Holder hereof upon the cancellation hereof.
In case an Event of Default shall have occurred and be continuing, the
principal of all of the Debt Securities of this series may be declared, and upon
such declaration shall become, due and payable, in the manner, with the effect
and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the Holders of not less than a majority in aggregate
principal amount of Outstanding Debt Securities of each series affected, to
execute supplemental indentures for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the Indenture or
of any supplemental indenture or of modifying in any manner the rights of the
Holders of the Debt Securities; provided, however, that no such supplemental
-------- -------
indenture shall without the consent of the Holder of each Debt Security affected
thereby, (i) change the Stated Maturity of the principal or any installment of
principal or any installment of interest (other than as contemplated herein);
(ii) reduce the amount of principal or interest thereon, or any premium payable
upon redemption or repayment thereof; (iii) change the Place of Payment or the
currency in which principal or any interest is payable; (iv) impair the right to
institute suit for the enforcement of any payment of the principal and any
premium and interest, or adversely affect the right of any repayment at the
option of the Holder; (v) reduce the percentage in principal amount of Debt
Securities the consent of whose Holders is required for modification or
amendment of the Indenture or for waiver of compliance with certain provisions
of the Indenture or for waiver of certain defaults; (vi) reduce the requirements
contained in the Indenture for quorum or voting; or (vii) modify any of the
above provisions; provided, further, that if the Debt Securities of this series
-------- -------
are held by the Trust or a trustee of the Trust, a supplemental indenture shall
not be effective until the holders of a majority in liquidation preference of
Trust Securities shall have consented to such supplemental indenture; provided,
further, that if the consent of the Holder of each Outstanding Debt Security is
required in connection with a supplemental indenture, such supplemental
indenture shall not be effective until each holder of the Trust Securities shall
have consented to such supplemental indenture. The Indenture also contains
provisions permitting the Holders of a majority in principal amount of the
Outstanding Debt Securities of any series affected thereby, on behalf of all of
the Holders of the Outstanding Debt Securities of such series, to waive any past
default in the performance of any of the covenants contained in the Indenture,
or established pursuant to the Indenture with respect to such series, and its
consequences, except a default in the payment of the principal of or premium, if
any, or interest on any of the Debt Securities of such series; provided,
--------
however, that if the Debt Securities of this series are held by the Trust or a
- -------
trustee of the Trust, a waiver of a past default or any modification to a waiver
of a past
17
<PAGE>
default shall not be effective until the holders of a majority in liquidation
preference of Trust Securities shall have consented to such waiver or
modification; provided, further, that if the consent of the Holder of each
-------- -------
Outstanding Debt Security is required in connection with such waiver or
modification, such waiver or modification shall not be effective until each
holder of the Trust Securities shall have consented to such waiver or
modification. Any such consent or waiver by the registered Holder of this Debt
Security (unless revoked as provided in the Indenture) shall be conclusive and
binding upon such Holder and upon all future Holders and owners of this Debt
Security and of any Debt Security issued in exchange herefor or in place hereof
(whether by registration of transfer or otherwise), irrespective of whether or
not any notation of such consent or waiver is made upon this Debt Security.
No reference herein to the Indenture and no provision of this Debt Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and interest on this Debt
Security at the time and place and at the rate and in the money herein
prescribed.
The Company shall have the right at any time during the term of this Debt
Security from time to time to extend the interest payment period of this Debt
Security to up to 20 consecutive quarters (an "Extended Interest Payment
Period"), at the end of which period the Company shall pay all interest then
accrued and unpaid (together with interest thereon at the rate specified for
this Debt Security herein to the extent that payment of such interest is
enforceable under applicable law). Before the termination of any such Extended
Interest Payment Period, the Company may further extend such Extended Interest
Payment Period, provided that such Extended Interest Payment Period together
with all such further extensions thereof shall not exceed 20 consecutive
quarters. At the termination of any such Extended Interest Payment Period and
upon the payment of all accrued and unpaid interest and any additional amounts
then due, the Company may commence a new Extended Interest Payment Period.
As provided in the Indenture and subject to certain limitations therein set
forth, this Debt Security is transferable by the registered Holder hereof on the
Security Register of the Company, upon surrender of this Debt Security for
registration of transfer at the office or agency of the Company in Wilmington,
Delaware accompanied by a written instrument or instruments of transfer in form
satisfactory to the Company or the Trustee duly executed by the registered
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Debt Securities of authorized denominations and for the same aggregate
principal amount and series will be issued to the designated transferee or
transferees. No service charge will be made for any such transfer, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in relation thereto.
Prior to due presentment for registration of transfer of this Debt
Security, the Company, the Trustee, any Paying Agent and any Security Registrar
may deem and treat the
18
<PAGE>
registered Holder hereof as the absolute owner hereof (whether or not this Debt
Security shall be overdue and notwithstanding any notice of ownership or writing
hereon made by anyone other than the Security Registrar) for the purpose of
receiving payment of or on account of the principal hereof and interest due
hereon and for all other purposes, and neither the Company nor the Trustee nor
any Paying Agent nor any Security Registrar shall be affected by any notice to
the contrary.
No recourse shall be had for the payment of the principal of or the
interest on this Debt Security, or for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture, against any
incorporator, stockholder, officer or director, past, present or future, as
such, of the Company or the Trustee or of any predecessor or successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the
issuance hereof, expressly waived and released.
[**IF A GLOBAL SECURITY -- This Debt Security is exchangeable for Debt
Securities in definitive form only under certain limited circumstances set forth
in the Indenture.] Debt Securities of this series so issued are issuable only
in registered form without coupons in denominations of $25 and any integral
multiple thereof as provided in the Indenture and subject to certain limitations
herein and therein set forth. Debt Securities of this series so issued are
exchangeable for a like aggregate principal amount of Debt Securities of this
series of a different authorized denomination, as requested by the Holder
surrendering the same.
All terms used in this Debt Security that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
ARTICLE IX
ORIGINAL ISSUE OF NOTES
Section 9.1 Original Issue of Notes.
Notes in the aggregate principal amount of $128,865,979.40 may, upon
execution of this Second Supplemental Indenture, be executed by the Company and
delivered to the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver said Notes upon Company Order.
19
<PAGE>
Section 9.2 Reports by the Trustee.
Up until and including the Maturity Date, the Trustee shall, in respect of
each Reporting Date, make such reports, and within such time periods, as are
required to be made by the Trustee under the Trust Indenture Act.
ARTICLE X
LIMITATION ON WAIVERS AND CONSENTS
Notwithstanding anything to the contrary contained in Section 513 of the
Indenture, if the Notes are held by the Trust or a trustee of the Trust, a
waiver of a past default or any modification to a waiver of a past default shall
not be effective until the holders of a majority in liquidation preference of
Trust Securities shall have consented to such waiver or modification; provided,
--------
however, that if the consent of the Holder of each Note Outstanding is required
- -------
in connection with such waiver or modification, such waiver or modification
shall not be effective until each holder of the Trust Securities shall have
consented to such waiver or modification.
Notwithstanding anything to the contrary contained in Section 902 of the
Indenture, if the Notes are held by the Trust or a trustee of the Trust, a
supplemental indenture shall not be effective until the holders of a majority in
liquidation preference of Trust Securities shall have consented to such
supplemental indenture; provided, however, that if the consent of the Holder of
each Note Outstanding is required in connection with a supplemental indenture,
such supplemental indenture shall not be effective until each holder of the
Trust Securities shall have consented to such supplemental indenture.
ARTICLE XI
MISCELLANEOUS
Section 11.1 Ratification of Indenture.
The Indenture, as supplemented by this Second Supplemental Indenture, is in
all respects ratified and confirmed, and this Second Supplemental Indenture
shall be deemed part of the Indenture in the manner and to the extent herein and
therein provided.
Section 11.2 Trustee Not Responsible for Recitals.
The recitals herein contained are made by the Company and not by the
Trustee, and the Trustee assumes no responsibility for the correctness thereof.
The Trustee makes no representation as to the validity or sufficiency of this
Second Supplemental Indenture.
20
<PAGE>
Section 11.3 Governing Law.
This Second Supplemental Indenture and each Note shall be deemed to be a
contract made under the internal laws of the State of New York, and for all
purposes shall be construed in accordance with the laws of said State.
Section 11.4 Separability.
In case any one or more of the provisions contained in this Second
Supplemental Indenture or in the Notes shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Second
Supplemental Indenture or of the Notes, but this Second Supplemental Indenture
and the Notes shall be construed as if such invalid or illegal or unenforceable
provision had never been contained herein or therein.
Section 11.5 Counterparts.
This Second Supplemental Indenture may be executed in any number of
counterparts each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
Section 11.6 Third Party Beneficiaries.
The Property Trustee, the trustee under the Preferred Securities Guarantee
and the Delaware Trustee are each a third party beneficiary of, and shall be
entitled to enforce and to exercise all rights and remedies with respect to, the
provisions of Article V. Each of the holders of Preferred Securities is a third
party beneficiary of, and shall be entitled to enforce and to exercise all
rights and remedies with respect to, the provisions of Section 6.2(c).
21
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, on the date or dates indicated in the
acknowledgments and as of the day and year first above written.
RELIASTAR FINANCIAL CORP.
By /s/ Wayne R. Huneke
-----------------------------------------------
Attest:
/s/ Richard R. Crowl
- -----------------------------------
Secretary
WILMINGTON TRUST COMPANY, not in
its individual capacity but solely as Trustee
By /s/ Patricia A. Evans
-----------------------------------------------
Attest:
/s/ Donald G. MacKelcan
- --------------------------------------
Secretary
<PAGE>
STATE OF MINNESOTA )
)SS.
COUNTY OF HENNEPIN )
On the 3rd day of June, 1997, before me personally came Wayne R.
Huneke, to me known, who, being duly sworn, did depose and say that he resides
at Minneapolis, Minnesota; that he is a Senior Vice President, General Counsel
and Secretary of ReliaStar Financial Corp., a corporation described in and which
executed the above instrument; that he knows the seal of said corporation; that
it was so affixed pursuant to the authority of the Board of Directors of said
corporation; and that he signed his name thereto pursuant to like authority.
/s/ Steven E. Suckow
--------------------------------------------------
Notary Public
Steven E. Suckow
Notary Public
My Commission Expres: January 31, 2000
<PAGE>
STATE OF DELAWARE )
)SS.
COUNTY OF NEW CASTLE )
On the 2nd day of June, 1997, before me personally came Donald G.,
MacKelcan, to me known, who, being duly sworn, did depose and say that he
resides at Wilmington, Delaware; that he is an Assistant Vice President of
Wilmington Trust Company, a Delaware banking corporation described in and which
executed the above instrument; that he knows the seal of said corporation; that
it was so affixed pursuant to the authority of the Board of Directors of said
corporation; and that he signed his name thereto pursuant to like authority.
/s/ Kathleen A. Pedelini
--------------------------------------------------
Notary Public
Kathleen A. Pedelini
Notary Public
My Commission Expres: October 31, 1998
<PAGE>
EXHIBIT 4(S)
================================================================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
RELIASTAR FINANCING II
Dated as of June 3, 1997
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I
---------
DEFINITIONS AND INTERPRETATION
Section 1.1. Definitions and Interpretation................................................ 1
ARTICLE II
TRUST INDENTURE ACT
Section 2.1. Trust Indenture Act; Application.............................................. 5
Section 2.2. Lists of Holders of Trust Securities.......................................... 5
Section 2.3. Reports by Preferred Guarantee Trustee........................................ 6
Section 2.4. Periodic Reports to Preferred Guarantee Trustee............................... 6
Section 2.5. Evidence of Compliance with Conditions Precedent.............................. 6
Section 2.6. Events of Default; Waiver..................................................... 6
Section 2.7. Event of Default; Notice...................................................... 6
Section 2.8. Conflicting Interests......................................................... 7
ARTICLE III
POWER, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE
Section 3.1. Powers and Duties of Preferred Guarantee Trustee.............................. 7
Section 3.2. Certain Rights of Preferred Guarantee Trustee................................. 9
Section 3.3. Not Responsible for Recitals or Issuance of Guarantee......................... 11
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
Section 4.1. Preferred Guarantee Trustee; Eligibility...................................... 11
Section 4.2. Appointment, Removal and Resignation of Preferred Guarantee Trustee........... 12
ARTICLE V
GUARANTEE
Section 5.1. Guarantee..................................................................... 12
Section 5.2. [Reserved].................................................................... 13
Section 5.3. Waiver of Notice and Demand................................................... 13
Section 5.4. Obligations Not Affected...................................................... 13
Section 5.5. Rights of Holders............................................................. 14
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Section 5.6. Guarantee of Payment.......................................................... 14
Section 5.7. Subrogation................................................................... 14
Section 5.8. Independent Obligations....................................................... 15
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
Section 6.1. Limitation of Transactions.................................................... 15
Section 6.2. Ranking....................................................................... 15
ARTICLE VII
TERMINATION
Section 7.1. Termination................................................................... 16
ARTICLE VIII
INDEMNIFICATION
Section 8.1. Exculpation................................................................... 16
Section 8.2. Indemnification............................................................... 17
ARTICLE IX
MISCELLANEOUS
Section 9.1. Successors and Assigns........................................................ 17
Section 9.2. Amendments.................................................................... 17
Section 9.3. Limitation of Liability....................................................... 18
Section 9.4. Notices....................................................................... 18
Section 9.5. Benefit....................................................................... 19
Section 9.6. Governing Law................................................................. 19
</TABLE>
-ii-
<PAGE>
PREFERRED SECURITIES GUARANTEE AGREEMENT
THIS PREFERRED SECURITIES GUARANTEE AGREEMENT ("Preferred Securities
Guarantee Agreement"), dated as of June 3, 1997, is executed and delivered by
ReliaStar Financial Corp., a Delaware corporation (the "Guarantor"), and
Wilmington Trust Company, a Delaware banking corporation, as trustee, for the
benefit of the holders, from time to time, of the Preferred Securities of
ReliaStar Financing II, a Delaware statutory business trust (the "Trust").
RECITALS
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of June 3, 1997, among the trustees of the Trust named
therein, the Guarantor, as sponsor and the holders, from time to time, of
undivided beneficial interests in the assets of the Trust, the Trust is issuing
on the date hereof $125 million aggregate stated liquidation amount of Preferred
Securities designated the 8.10% Trust Originated Preferred Securities (the
"Preferred Securities");
WHEREAS, as incentive for such holders to purchase the Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Preferred Securities Guarantee Agreement, to pay to
the holders, from time to time, of Preferred Securities the Guarantee Payments
(as defined below) and to make certain other payments on the terms and
conditions set forth herein; and
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 Agreement for the benefit of the holders, from time to time, of the
Preferred Securities.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1. DEFINITIONS AND INTERPRETATION.
In this Preferred Securities Guarantee Agreement, unless the context
otherwise requires:
(a) capitalized terms used in this Preferred Securities Guarantee
Agreement 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 Preferred Securities Guarantee
Agreement has the same meaning throughout;
(c) all references to "the Preferred Securities Guarantee Agreement" or
"this Preferred Securities Guarantee Agreement" are to this Preferred Securities
Guarantee Agreement as modified, supplemented or amended from time to time;
(d) all references in this Preferred Securities Guarantee Agreement to
Articles and Sections are to Articles and Sections of this Preferred Securities
Guarantee Agreement unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Preferred Securities Guarantee Agreement unless otherwise defined
in this Preferred Securities Guarantee Agreement or unless the context otherwise
requires; and
(f) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means any Person that is authorized to
bind such Person.
"Common Securities" means the common securities of the Trust designated
8.10% Trust Originated Common Securities issued on the date hereof.
"Corporate Trust Office" means the principal office of the Preferred
Guarantee Trustee at which at any particular time its corporate trust business
shall be administered, which office at the date of execution of this Preferred
Securities Guarantee Agreement is located at Wilmington Trust Company, Rodney
Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attn:
Corporate Trust Administration.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
"Declaration" has the meaning set forth in the preamble.
"Direction" by a Person means a written direction signed:
(a) if the Person is a natural person by the Person; or
(b) in any other case, in the name of such Person by one or more
Authorized Officers of that Person.
"Distribution" means a distribution payable to Holders of Trust Securities
in accordance with the terms of the Declaration.
2
<PAGE>
"Event of Default" means a default by the Guarantor on any of its payment
or other obligations under this Preferred Securities Guarantee Agreement.
"Guarantee Payments" mean the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or
made by the Trust: (i) any accrued and unpaid Distributions that are required to
be paid on such Preferred Securities, to the extent the Trust shall have
received a payment of interest or principal on the Notes therefor from the
Guarantor, (ii) the Redemption Price, to the extent the Trust has received a
payment of interest or principal on the Notes from the Guarantor with respect to
any Preferred Securities called for redemption by the Trust, and (iii) the
Liquidation Distribution due upon a voluntary or involuntary dissolution,
winding-up or termination of the Trust (other than in connection with the
distribution of Notes 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 the Notes).
"Holder" means a Person in whose name a Certificate representing a Trust
Security is registered on the books and records of the Trust, such Person being
a beneficial owner within the meaning of the Delaware Business Trust Act,
provided, that, in determining whether the holders of the requisite percentage
of Preferred Securities have given any request, notice, consent or waiver
hereunder, "Holder" shall not include the Guarantor, or any Affiliate of the
Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee, any Affiliate
of the Preferred Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives or agents of the Preferred
Guarantee Trustee.
"Indenture" means the Indenture dated as of March 29, 1996, among the Note
Issuer and Wilmington Trust Company, as trustee, as supplemented by the First
Supplemental Indenture dated March 29, 1996, the Second Supplemental Indenture
dated June 3, 1997, and any indenture supplemental thereto.
"Liquidation Distribution" means the lesser of (a) the aggregate of the
liquidation amount and all accrued and unpaid Distributions on the Preferred
Securities to the date of payment to the extent the Trust shall have received
payments of interest or principal on the Notes therefor from the Guarantor, or
(b) the amount of assets of the Trust remaining available for distribution to
Holders in liquidation of the Trust.
"List of Holders" has the meaning set forth in Section 2.2.(a).
"Majority in liquidation amount of the Preferred Securities" means, except
as provided by the Trust Indenture Act, a vote by Holder(s) of Preferred
Securities, voting separately as a class, of 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
3
<PAGE>
to the date upon which the voting percentages are determined) of all outstanding
Preferred Securities.
"Note Issuer" means the Guarantor in its capacity as issuer of the Notes.
"Notes" means the series of Notes to be issued by the Note Issuer under the
Indenture and acquired by the Trust.
"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 Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definition relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by 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 compiled 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 Wilmington Trust Company, until a
Successor Preferred Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Preferred Securities Guarantee
Agreement, and thereafter means each such Successor Preferred Guarantee Trustee.
"Preferred Securities" has the meaning set forth in the preamble.
"Redemption Price" means the liquidation amount of $25 per Trust Security
plus all accrued and unpaid Distributions to the date of redemption.
"Responsible Officer" means, when used with respect to the Preferred
Guarantee Trustee, an officer in the Corporate Trust Office of the Preferred
Guarantee Trustee, including the president, any vice-president, any assistant
vice-president, the secretary, any assistant secretary, the treasurer, any
assistant treasurer, any trust officer or assistant trust officer or any
4
<PAGE>
other officer 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.
"Securities Act" means the Securities Act of 1933, as amended from time to
time, or any successor legislation.
"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 in effect at
the date as of which this instrument was executed, provided, however, that in
the event the Trust Indenture Act is amended after such date, "Trust Indenture
Act" means to the extent required by any such amendment, the Trust Indenture Act
of 1939 as so amended.
"Trust Securities" means collectively the Common Securities and the
Preferred Securities.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1. TRUST INDENTURE ACT; APPLICATION.
(a) This Preferred Securities Guarantee Agreement is subject to the
provisions of the Trust Indenture Act that are required to be part of this
Preferred Securities Guarantee Agreement and shall, to the extent applicable, be
governed by such provisions.
(b) If and to the extent that any provision of this Preferred Securities
Guarantee Agreement limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317 (inclusive) of the Trust Indenture Act, the duties imposed
by the Trust Indenture Act shall control.
SECTION 2.2. LISTS OF HOLDERS OF TRUST SECURITIES.
(a) The Guarantor shall provide the Preferred Guarantee Trustee with a
list, in such form as the Preferred Guarantee Trustee may reasonably require, of
the names and addresses of the Holders of Preferred Securities ("List of
Holders") as of such date, (i) within 14 days after each record date for payment
of Distributions, and (ii) at any other time within 30 days of receipt by the
Guarantor of a written request for a List of Holders as of a date no more than
14 days before such List of Holders is given to the Preferred Guarantee Trustee,
provided that the Guarantor shall not be obligated to provide such List of
Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Preferred Guarantee
5
<PAGE>
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 PREFERRED GUARANTEE TRUSTEE.
Within 60 days after December 31 of each year, the Preferred Guarantee
Trustee shall provide to the Holders of the Preferred Securities such reports as
are required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The Preferred
Guarantee Trustee shall also comply with the requirements of Section 313(d) of
the Trust Indenture Act.
SECTION 2.4. 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 of the Trust
Indenture Act, 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 Agreement that relate to any of the matters
set forth in Section 314(c) of the Trust Indenture Act. Any certificate or
opinion required to be given by an officer pursuant to Section 314(c)(1) may be
given in the form of an Officers' Certificate.
SECTION 2.6. EVENTS OF DEFAULT; WAIVER.
The Holders of a Majority in liquidation amount of the 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 Agreement, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
SECTION 2.7. 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 of Preferred Securities, notices of all Events of
Default known to the Preferred Guarantee Trustee, unless such defaults have been
cured before the giving of such notice, provided, that, the Preferred
6
<PAGE>
Guarantee Trustee shall be protected in withholding such notice if and so long
as the board of directors, the executive committee, or a trust committee of
directors or Responsible Officers of the Preferred Guarantee Trustee in good
faith determines that the withholding of such notice is in the interests of the
Holders of Preferred Securities.
(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 as provided in Section 9.4., or a Responsible Officer of
the Preferred Guarantee Trustee shall have obtained actual notice, of such Event
of Default.
SECTION 2.8. CONFLICTING INTERESTS.
The Declaration shall be deemed to be specifically described in this
Preferred Securities Guarantee Agreement for the purposes of clause (1) the
first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWER, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1. POWERS AND DUTIES OF PREFERRED GUARANTEE TRUSTEE.
(a) This Preferred Securities Guarantee Agreement shall be held by the
Preferred Guarantee Trustee for the benefit of the Holders of Preferred
Securities, and the Preferred Guarantee Trustee shall not transfer this
Preferred Securities Guarantee Agreement to any Person except a Holder of
Preferred Securities exercising his or her rights pursuant to Section 5.5.(b) or
to a Successor Preferred Guarantee Trustee on acceptance by such Successor
Preferred Guarantee Trustee of its appointment to act as Successor Preferred
Guarantee Trustee. The right, title and interest of the Preferred Guarantee
Trustee shall automatically vest in any Successor Preferred Guarantee Trustee,
and such vesting and cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Preferred Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the Preferred
Guarantee Trustee shall enforce this Preferred Securities Guarantee Agreement
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 Agreement, and no implied covenants shall be
read into this Preferred Securities Guarantee
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Agreement against the Preferred Guarantee Trustee. In case an Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.6.), the
Preferred Guarantee Trustee shall exercise such of the rights and powers vested
in it by this Preferred Securities Guarantee Agreement, and use the same degree
of care and skill in its exercise thereof, as a prudent person would exercise or
use under the circumstances in the conduct of his or her own affairs.
(d) No provision of this Preferred Securities Guarantee Agreement shall be
construed to relieve the Preferred Guarantee Trustee from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Preferred Guarantee
Trustee shall be determined solely by the express provisions of this
Preferred Securities Guarantee Agreement, and the Preferred Guarantee
Trustee shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this Preferred
Securities Guarantee Agreement, and no implied covenants or
obligations shall be read into this Preferred Securities Guarantee
Agreement against the Preferred Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Preferred
Guarantee Trustee, the Preferred Guarantee Trustee may conclusively
rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Preferred Guarantee Trustee and conforming to the
requirements of this Preferred Securities Guarantee Agreement; but in
the case of any such certificates or opinions that by any provision
hereof are specifically required to be furnished to the Preferred
Guarantee Trustee, the Preferred Guarantee Trustee shall be under a
duty to examine the same to determine whether or not they conform to
the requirements of this Preferred Securities Guarantee Agreement;
(ii) the Preferred Guarantee Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer of the
Preferred Guarantee Trustee, unless it shall be proved that the Preferred
Guarantee Trustee was negligent in ascertaining the pertinent facts upon
which such judgment was made;
(iii) the Preferred Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a Majority in
liquidation amount of the Preferred Securities relating to the time, method
and place of conducting any proceeding for any remedy available to the
Preferred Guarantee Trustee, or exercising any trust or power conferred
upon the Preferred Guarantee Trustee under this Preferred Securities
Guarantee Agreement; and
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(iv) no provision of this Preferred Securities Guarantee Agreement
shall require the Preferred Guarantee Trustee to expend or risk its own
funds or otherwise incur personal financial liability in the performance of
any of its duties or in the exercise of any of its rights or 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 Agreement or
adequate indemnity 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 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 Agreement shall be sufficiently evidenced by
a Direction or an Officers' Certificate.
(iii) Whenever, in the administration of this Preferred Securities
Guarantee Agreement, the Preferred Guarantee Trustee shall deem it
desirable that a matter be proved or established before taking, suffering
or omitting any action hereunder, the Preferred Guarantee Trustee (unless
other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an 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).
(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 Agreement from any court of competent jurisdiction.
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(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 Agreement at the request or direction of any Holder of
Preferred Securities, unless such Holder shall have provided to the
Preferred Guarantee Trustee such security and indemnity acceptable to the
Preferred Guarantee Trustee, against the costs, expenses (including
attorneys' fees and expenses) and liabilities that might be incurred by it
in complying with such request or direction, including such reasonable
advances as may be requested by the Preferred Guarantee Trustee; provided
that, nothing contained in this Section 3.2.(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 Agreement.
(vii) The Preferred Guarantee Trustee shall not be bound to make
any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Preferred Guarantee
Trustee, in its discretion may make such further inquiry or investigation
into such facts or matters as it may see fit.
(viii) The Preferred Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder either directly
or by or through agents or attorneys, and the Preferred Guarantee Trustee
shall not be responsible for any misconduct or negligence on the part of
any agent or attorney appointed with due care by it hereunder.
(ix) Any action taken by the Preferred Guarantee Trustee or its
agents hereunder shall bind the Holders of 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 Agreement, both of which
shall be conclusively evidenced by the Preferred Guarantee Trustee's or its
agent's taking such action.
(x) Whenever in the administration of this Preferred Securities
Guarantee Agreement the Preferred Guarantee Trustee shall deem it desirable
to receive instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Preferred Guarantee Trustee (A) may
request instructions from the Holders of Preferred Securities, (B) may
refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (C) shall be protected in acting
in accordance with such instructions.
(b) No provision of this Preferred Securities Guarantee Agreement shall be
deemed to impose any duty or obligation on the Preferred Guarantee Trustee to
perform any act or acts
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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 Preferred Securities Guarantee Agreement
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 Agreement.
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 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 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.
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SECTION 4.2. APPOINTMENT, REMOVAL AND RESIGNATION OF PREFERRED GUARANTEE
TRUSTEE.
(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 and
the resigning Preferred Guarantee Trustee.
(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.
ARTICLE V
GUARANTEE
SECTION 5.1. GUARANTEE.
The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders of Preferred Securities the Guarantee Payments (without duplication of
amounts theretofore paid by the Trust), as and when due, regardless of any
defense, right of set-off or counterclaim that the Trust 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 of
Preferred Securities or by causing the Trust to pay such amounts to the Holders
of Preferred Securities.
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SECTION 5.2. [RESERVED].
SECTION 5.3. WAIVER OF NOTICE AND DEMAND.
The Guarantor hereby waives notice of acceptance of this Preferred
Securities Guarantee Agreement and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a proceeding first
against the Trust 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 5.4. OBLIGATIONS NOT AFFECTED.
The obligations, covenants, agreements and duties of the Guarantor under
this Preferred Securities Guarantee Agreement shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Trust of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Trust;
(b) the extension of time for the payment by the Trust of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Preferred Securities or the extension
of time for the performance of any other obligation under, arising out of, or in
connection with, the Preferred Securities (other than an extension of time for
payment of Distributions, Redemption Price, Liquidation Distribution or other
sums payable that results from the extension of any interest payment period on
the Notes or any extension of the maturity date of the Notes permitted by the
Indenture);
(c) any failure, omission, delay or lack of diligence on the part of the
Holders of Preferred Securities to enforce, assert or exercise any right,
privilege, power or remedy conferred on such Holders pursuant to the terms of
the Preferred Securities, or any action on the part of the Trust granting
indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Trust or any of the assets of the
Trust;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
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(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 5.4. that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders of Preferred Securities to give
notice to, or obtain consent of, the Guarantor with respect to the happening of
any of the foregoing.
SECTION 5.5. RIGHTS OF HOLDERS.
(a) The Holders of a Majority in liquidation amount of Preferred
Securities have the right to direct the time, method and place of conducting of
any proceeding for any remedy available to the Preferred Guarantee Trustee in
respect of this Preferred Securities Guarantee Agreement or exercising any trust
or power conferred upon the Preferred Guarantee Trustee under this Preferred
Securities Guarantee Agreement.
(b) If the Guarantor fails to make any payments required by the Preferred
Securities Guarantee Agreement, any Holder may institute a legal proceeding
directly against the Guarantor to enforce its rights under this Preferred
Securities Guarantee Agreement, without first instituting a legal proceeding
against the Trust, the Preferred Guarantee Trustee or any other Person.
SECTION 5.6. GUARANTEE OF PAYMENT.
This Preferred Securities Guarantee Agreement creates a guarantee of
payment and not of collection.
SECTION 5.7. SUBROGATION.
The Guarantor shall be subrogated to all (if any) rights of the Holders of
Preferred Securities against the Trust in respect of any amounts paid to the
Holders of Preferred Securities by the Guarantor under this Preferred Securities
Guarantee Agreement; provided, however, that the Guarantor shall not (except to
the extent required by mandatory provisions of law) be entitled to enforce or
exercise any right that it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under this
Preferred Securities Guarantee Agreement, if, at the time of any such payment,
any amounts are due and unpaid under this Preferred Securities Guarantee
Agreement. If any amount shall be paid to the Guarantor in violation of the
preceding sentence, the Guarantor agrees to hold such amount in trust for the
Holders of Preferred Securities and to pay over such amount to the Holders of
Preferred Securities.
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SECTION 5.8. INDEPENDENT OBLIGATIONS.
The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Trust 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
Agreement notwithstanding the occurrence of any event referred to in subsections
(a) through (g), inclusive, of Section 5.4. 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 an Event of Default or an event of default under the Declaration, then
(a) the Guarantor shall not declare or pay any dividend on, or make any
distribution with respect to, or redeem, purchase or acquire or make a
liquidation payment with respect to, any of its capital stock and (b) the
Guarantor shall not make any payment of interest, principal or premium, if any,
on or repay, repurchase or redeem any debt securities (including guarantees)
issued by the Guarantor which rank pari passu with or junior to the Notes,
provided, that, the foregoing restriction in this Section 6.1. shall not apply
to any stock dividends paid by the Guarantor, where the dividend stock is the
same stock as that on which the dividend is being paid.
SECTION 6.2. RANKING.
This Preferred Securities Guarantee Agreement will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to all other liabilities of the Guarantor (other than any guarantee now
or hereafter entered into by the Guarantor in respect of any preferred or
preference stock of any Affiliate of the Guarantor), (ii) pari passu with the
most senior preferred or preference stock (including trust-related securities)
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.
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ARTICLE VII
TERMINATION
SECTION 7.1. TERMINATION.
This Preferred Securities Guarantee Agreement shall terminate upon (i) full
payment of the Redemption Price of all Preferred Securities, (ii) the
distribution of the Notes to the Holders of all Preferred Securities or (iii)
full payment of the amounts payable in accordance with the Declaration upon
liquidation of the Trust. Notwithstanding the foregoing, this Preferred
Securities Guarantee Agreement will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of Preferred
Securities must restore payment of any sums paid under the Preferred Securities
or under this Preferred Securities Guarantee. Notwithstanding anything contained
herein to the contrary, the obligations of the Guarantor set forth in Article
VIII hereof shall survive termination of this Preferred Securities Guarantee
Agreement or the earlier resignation or removal of the Preferred Guarantee
Trustee.
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 Agreement and in a manner that such Indemnified Person reasonably
believed to be within the scope of the authority conferred on such Indemnified
Person by this Preferred Securities Guarantee Agreement or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's negligence or willful misconduct
with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Preferred Securities might properly be paid.
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SECTION 8.2. INDEMNIFICATION.
(a) To the fullest extent permitted by applicable law, the Guarantor shall
indemnify and hold harmless each Indemnified Person from and against any loss,
damage, liability or claim incurred by such Indemnified Person in connection
with this Preferred Securities Guarantee Agreement, including, without
limitation, by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Preferred Securities
Guarantee Agreement and in a manner such Indemnified Person reasonably believed
to be within the scope of authority conferred on such Indemnified Person by this
Preferred Securities Guarantee Agreement, except that no Indemnified Person
shall be entitled to be indemnified in respect of any loss, damage or claim
incurred by such Indemnified Person by reason of negligence or willful
misconduct with respect to such acts or omissions. The obligation to indemnify
as set forth in this Section 8.2 shall survive the termination of this Preferred
Securities Guarantee Agreement.
(b) To the fullest extent permitted by applicable law, expenses (including
legal fees) incurred by an Indemnified Person in defending any claim, demand,
action, suit or proceeding shall, from time to time, be advanced by the
Guarantor prior to the final disposition of such claim, demand, action, suit or
proceeding upon receipt by the Guarantor of any undertaking by or on behalf of
the Indemnified Person to repay such amount if it shall be determined that the
Indemnified Person is not entitled to be indemnified as authorized in Section
8.2.(a).
ARTICLE IX
MISCELLANEOUS
SECTION 9.1. SUCCESSORS AND ASSIGNS.
All guarantees and agreements contained in this Preferred Securities
Guarantee Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of Preferred Securities.
SECTION 9.2. AMENDMENTS.
Except with respect to any changes that do not adversely affect the rights
of Holders of Preferred Securities (in which case no consent of Holders will be
required), this Preferred Securities Guarantee Agreement may only be amended
with the prior approval of the Holders of at least a majority in 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 of the Trust Securities apply to the giving of such
approval. The Preferred Guarantee Trustee may, but
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shall have no obligation to, execute and deliver any amendment to this Preferred
Securities Guarantee Agreement which affects the Preferred Guarantee Trustee's
rights, duties or immunities hereunder or otherwise.
SECTION 9.3. LIMITATION OF LIABILITY.
It is expressly understood and agreed by the parties hereto that (a) this
Agreement is executed and delivered by Wilmington Trust Company, not
individually or personally but solely as the Preferred Guarantee Trustee, in the
exercise of the powers and authority conferred and vested in it, (b) nothing
herein contained shall be construed as creating any liability on Wilmington
Trust Company, individually or personally, to perform any covenant either
expressed or implied contained herein, all such liability, if any, being
expressly waived by the Guarantor and by any Person claiming by, through or
under the Guarantor, and (c) under no circumstances shall Wilmington Trust
Company be personally liable for the payment of any indebtedness or expenses of
the Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Preferred
Guarantee Trustee under this Preferred Securities Guarantee Agreement.
SECTION 9.4. NOTICES.
All notices provided for in this Preferred Securities Guarantee Agreement
shall be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by registered or certified mail as follows:
(a) If given to the Preferred Guarantee Trustee, at the Preferred
Guarantee Trustee's mailing address set forth below (or such other address as
the Preferred Guarantee Trustee may give notice of to the Holders of Preferred
Securities):
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attn: Corporate Trust Administration
Telecopy: (302) 651-8882
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(b) If given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders of Preferred Securities):
ReliaStar Financial Corp.
20 Washington Avenue South
Minneapolis, Minnesota 55401
Telecopy Number: (612) 372-5479
(c) If given to any Holder of Preferred Securities, at the address set
forth in 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 9.5. BENEFIT.
This Preferred Securities Guarantee Agreement is solely for the benefit of
the Holders of Preferred Securities and, subject to Section 3.1.(a), is not
separately transferable from the Preferred Securities.
SECTION 9.6. GOVERNING LAW.
This Preferred Securities Guarantee Agreement and the rights of the parties
hereunder shall be governed by 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 to principles of conflicts of laws.
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IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
RELIASTAR FINANCIAL CORP.
By /s/ Richard R. Crowl
----------------------------------------------
Name: Richard R. Crowl
Title: Senior Vice President, General Counsel and
Secretary
WILMINGTON TRUST COMPANY,
as Preferred Guarantee Trustee
By /s/ Patricia A. Evans
----------------------------------------------
Name: Patricia A. Evans
Title: Financial Services Officer
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[LETTERHEAD OF RICHARDS, LAYTON & FINGER]
One Rodney Square
P.O. Box 551
Wilmington, Delaware 19899
Telephone (302) 658-6541
Telecopier (302) 658-6548
Writer's Direct Dial Number
June 3, 1997
ReliaStar Financing II
c/o ReliaStar Financial Avenue South
Minneapolis, Minnesota 55401
Re: ReliaStar Financing II
----------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for ReliaStar Financial
Corp., a Delaware corporation (the "Corporation"), and ReliaStar Financing II, a
Delaware business trust (the "Trust"), in connection with matters set forth
herein. At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated May 8, 1997 (the
"Certificate"), as filed in the office of the Secretary of State of the State of
Delaware (the "Secretary of State") on May 8, 1997;
(b) The Declaration of Trust of the Trust, dated as of May 8, 1997, by
and among ReliaStar, as Sponsor, and the trustees of the Trust named therein;
(c) The Amended and Restated Declaration of Trust of the Trust, dated
as of June 3, 1997 (including Annexes I and II and Exhibit A thereto) (the
"Declaration"), among ReliaStar, as Sponsor, the trustees of the Trust named
therein, and the holders, from time to time, of undivided beneficial interests
in the assets of the Trust;
<PAGE>
ReliaStar Financing II
June 3, 1997
Page 2
(d) The Underwriting Agreement, dated May 29, 1997 (the "Underwriting
Agreement"), among ReliaStar, the Trust and you, as representatives of the
several underwriters named in Schedule A to the Underwriting Agreement;
(e) The Pricing Agreement, dated May 29, 1997 (the "Pricing
Agreement"), among ReliaStar, the Trust and you, as representatives of the
several underwriters named in Schedule A to the Underwriting Agreement;
(f) The Prospectus Supplement, dated May 29, 1997, which supplements
the Prospectus, dated May 27, 1997 (together being collectively referred to as
the "Prospectus"), relating to the 8.10% Trust Originated Preferred Securities
of the Trust representing preferred undivided beneficial interests in the assets
of the Trust (each, a "Preferred Security" and collectively, the "Preferred
Securities"); and
(g) A Certificate of Good Standing for the Trust, dated June 2, 1997,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed above, and we have assumed that there exists no
provision in any document that we have not reviewed that bears upon or is
inconsistent with the opinions stated herein. We have conducted no independent
factual investigation of our own but rather have relied solely upon the
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to be
true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Declaration
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Declaration and the Certificate are in
full force and effect and have not been amended, (ii) except to the extent
provided in paragraph 1 below, the due creation or due organization or due
formation, as the case may be, and valid existence in good standing of each
party to the documents examined by us under the laws of the jurisdiction
governing its creation or organiza tion or formation, (iii) the legal capacity
of natural persons who are parties to the documents examined by us, (iv) except
to the extent provided in paragraph 4 below, that each of the parties
<PAGE>
ReliaStar Financing II
June 3, 1997
Page 3
to the documents examined by us has the power and authority to execute and
deliver, and to perform its obligations under, such documents, (v) except to the
extent provided in paragraph 5 below, the due authorization, execution and
delivery by all parties thereto of all documents examined by us, (vi) the
receipt by each Person to whom a Preferred Security is to be issued by the Trust
(each, a "Preferred Security Holder" and collectively, the "Preferred Security
Holders") of an undivided beneficial interest in a fully-registered global
Preferred Security deposited with The Depository Trust Company in the State of
New York and the payment for such undivided beneficial interest in the Preferred
Security acquired by it, in accordance with the Declaration and the Prospectus,
and (vii) that the Preferred Securities are issued and sold in accordance with
the Declaration and the Prospectus. We have not participated in the preparation
of the Prospec tus and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, 12 Del. C.
(S) 3801, et seq.
2. The Preferred Securities to be issued to the Preferred Security
Holders have been duly authorized by the applicable Declaration and will be duly
and validly issued and, subject to the qualifications set forth in paragraph 3
below, fully paid and nonassessable undivided beneficial interests in the assets
of the applicable Trust.
3. The Preferred Security Holders, as beneficial owners of a Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred Security
Holders may be obligated to make payments as set forth in the applicable
Declaration.
We consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement. In addition,
we hereby consent to the use of our name under the heading "Validity of
Securities" in the Prospectus. In giving the foregoing consents, we do not
thereby admit that we come within the category of Persons whose consent is
required under Section 7 of the Securities Act of 1933, as amended, or the
<PAGE>
ReliaStar Financing II
June 3, 1997
Page 4
rules and regulations of the Securities and Exchange Commission thereunder.
Except as stated above, without our prior written consent, this opinion may not
be furnished or quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger
EAM/DKD
<PAGE>
EXHIBIT 8
June 3, 1997
ReliaStar Financial Corp.
20 Washington Avenue South
Minneapolis, Minnesota 55401
ReliaStar Financing II
20 Washington Avenue South
Minneapolis, Minnesota 55401
Re: ReliaStar Financial Corp./ReliaStar
Financing II -- Registration Statement on Form S-3
Relating to Trust Originated Preferred Securities(SM)
-----------------------------------------------------
Ladies and Gentlemen:
We have acted as special tax counsel for ReliaStar Financial Corp., a
Delaware corporation (the "Company"), and ReliaStar Financing II, a statutory
business trust organized under the Business Trust Act of the State of Delaware
(12 Del. Code Ann., tit. 12, Section 3801, et seq.) (the "Trust" and, together
with the Company, the "Offerors"), in connection with the proposed issuance and
sale by the Trust of 5,000,000 shares of 8.10% Trust Originated Preferred
Securities(SM) (liquidation amount $25 per Preferred Security) of the Trust
(the "Preferred Securities"), representing undivided beneficial interests in the
assets of the Trust.
The Preferred Securities are guaranteed by the Company with respect to
distributions and payments upon liquidation, redemption and otherwise pursuant
to a Preferred Securities Guarantee Agreement, dated as of the date of closing
(the "Preferred Securities Guarantee Agreement"), between the Company and
Wilmington Trust Company, as trustee, for the benefit of the holders of the
Preferred Securities.
In connection with the issuance and sale of the Preferred Securities, the
Trust is also issuing shares of its Common Securities (liquidation amount of $25
per Common Security)
_____________________
* "Trust Originated Preferred Securities(SM),, is a service mark of Merrill
Lynch & Co.
<PAGE>
ReliaStar Financial Corp.
ReliaStar Financing II
June 3, 1997
Page 2
(the "Common Securities"), representing undivided beneficial interests in the
assets of the Trust. The Common Securities are owned, directly or indirectly, by
the Company.
The entire proceeds from the sale of the Preferred Securities and the
Common Securities are being used by the Trust to purchase an aggregate principal
amount of $128,865,979.40 of 8.10% Subordinated Deferrable Interest Notes due
June 3, 2027 (the "Junior Subordinated Debt Securities"), issued by the Company.
The Preferred Securities and the Common Securities are issued pursuant to an
Amended and Restated Declaration of Trust of the Trust, dated as of the date of
closing (the "Declaration"), among the Company, as sponsor, certain named
persons as the regular trustees (collectively, the "Regular Trustees"), and
Wilmington Trust Company, as the property trustee (the "Property Trustee"). The
Junior Subordinated Debt Securities are issued pursuant to an indenture
and a first supplement thereto, both dated as of March 29, 1996 and a second
supplement thereto dated as of the date of closing (such indenture as so
supplemented, the "Indenture"), between the Company and Wilmington Trust
Company, as trustee.
This opinion is being furnished in accordance with the requirements of Item
601(b)(8) of Regulation S-K under the Securities Act of 1933, as amended (the
"1933 Act"). Capitalized terms used but not otherwise defined herein shall have
the respective meanings set forth in the Underwriting Agreement (as defined
below).
In connection with this opinion, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of (i) the Registration
Statement on Form S-3 (Registration No. 33-87588) filed with the Securities and
Exchange Commission (the "Commission") under the 1933 Act (such Registration
Statement as heretofore amended and supplemented, including all documents
incorporated or deemed to be incorporated therein pursuant to Item 12 of Form S-
3 under the 1933 Act, the "1994 Registration Statement"), the Registration
Statement on Form S-3 (Registration No. 33-80497) filed with the Commission
under the 1933 Act (such Registration Statement as heretofore amended and
supplemented, including all documents incorporated or deemed to be incorporated
therein pursuant to Item 12 of Form S-3 under the 1933 Act, the "1995
Registration Statement" and the Registration Statement on Form S-3 (Registration
No. 333-26881) filed with the Commission under the 1933 Act (such Registration
Statement as heretofore amended and supplemented, including all documents
incorporated or deemed to be incorporated therein pursuant to Item 12 of Form S-
3 under the 1933 Act, the "1997 Registration Statement"); (ii) the Certificate
of Trust dated May 8, 1997 filed by the Regular Trustees and the Property
Trustee with the Secretary of State of the State of Delaware; (iii) the
Declaration; (iv) the Preferred Securities and designation of the terms thereof;
(v) the Preferred Securities Guarantee Agreement; (vi) the Common Securities
and designation of the terms thereof;
<PAGE>
ReliaStar Financial Corp.
ReliaStar Financing II
June 3, 1997
Page 3
(vii) the Indenture; (viii) the Junior Subordinated Debt Securities; and (ix)
the Underwriting Agreement, dated May 29, 1997 (the "Underwriting Agreement"),
among the Offerors and the Representatives of the Underwriters named therein, as
supplemented by the Pricing Agreement, dated May 29, 1997, among the Offerors
and the Representatives of the Underwriters named therein (collectively, the
documents in items (i)-(ix) are referred to as the "Operative Documents"). We
have also examined originals or copies, certified or otherwise identified to our
satisfaction, of such records of the Company and the Trust and such agreements,
certificates of public officials, certificates of officers, trustees or other
representatives of the Company, the Trust and others, as applicable, and such
other documents, certificates and records as we have 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, conformed or photostatic copies and the
authenticity of the originals of such latter documents. In making our
examination of documents executed or to be executed by parties other than the
Company, 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, or will constitute, valid and binding obligations of
such parties. 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 Trust and others.
In rendering our opinion, we have participated in the preparation of the
1994 Registration Statement, the 1995 Registration Statement and the 1997
Registration, including the Prospectus included in the 1997 Registration
Statement. Our opinion is conditioned on, among other things, the initial and
continuing accuracy of the facts, information, covenants and representations set
forth in the documents referred to above and the statements and representations
made by the Company and the Trust.
Our opinion is also conditioned on the assumptions that (i) the Operative
Documents constitute all the agreements, arrangements and understandings between
or among the parties thereto with respect to the transactions contemplated
therein
<PAGE>
ReliaStar Financial Corp.
ReliaStar Financing II
June 3, 1997
Page 4
and with respect to the Preferred Securities, the Common Securities and the
Junior Subordinated Debt Securities, and (ii) there will be timely and full
compliance by all parties to the Operative Documents with the terms thereof
(without waiver or amendment of any of the terms thereof). This opinion is
furnished with the understanding that it is a condition of the closing of the
sale of the Preferred Securities that this opinion will have not been withdrawn.
In rendering our opinion, we have considered the provisions of the Internal
Revenue Code of 1986, as amended (the "Code"), Treasury regulations (proposed,
temporary and final) promulgated thereunder, judicial decisions and Internal
Revenue Service rulings, all as of the date hereof, and all of which are subject
to change, which changes may be retroactively applied. A change in the
authorities upon which our opinion is based could affect our conclusions. There
can be no assurance, moreover, that any of the opinions expressed herein will be
accepted by the Internal Revenue Service or, if challenged, by a court.
On February 6, 1997, the Clinton Administration released its budget
proposal for fiscal year 1998. The proposal contains certain tax law changes
that, if enacted, would prohibit an issuer from deducting interest payments or
original issue discount on an instrument such as the Junior Subordinated Debt
Securities if such instrument has a maximum weighted average maturity of more
than 40 years. Under the proposal, for purposes of determining the term of an
instrument, any right to extent would be treated as exercised. The
Administration's proposal, if enacted, would also treat a corporate issuer that
files annual financial statements with the Commission as having characterized an
instrument as the Junior Subordinated Debt Securities as equity for purposes of
Section 385(c) of the Code if the instrument (i) has a maximum term exceeding 15
years and (ii) is not shown as indebtedness on the applicable balance sheet of
the issuer or, in the case of indebtedness issued to a related party that issues
a related instrument, such related instrument is not reflected as indebtedness
on the applicable consolidated balance sheet. Under 385(c), the
characterization by the issuer of an instrument as equity is binding on the
issuer and all holders of the instrument unless a holder discloses on his tax
return that he is treating such instrument in a manner inconsistent with the
issuer's characterization. The Administration's proposal specifies that the
changes would be effective for instruments issued on or after the date of first
Congressional committee action. There can be no assurance that legislation
affecting the Company's ability to deduct interest paid on the Junior
Subordinated Debt Securities or the characterization of the Junior Subordinated
Debt Securities for U.S. federal income tax purposes, including legislation
similar to the proposals described above, will not be enacted in the future or
that any such legislation would not be effective retroactively.
<PAGE>
ReliaStar Financial Corp.
ReliaStar Financing II
June 3, 1997
Page 5
Based solely upon the foregoing, we are of the opinion that under current
United States federal income tax law:
(1) The Trust will be classified as a grantor trust and not as an
association taxable as a corporation. Accordingly, for United States federal
income tax purposes, each holder of Preferred Securities will generally be
considered the owner of an undivided interest in the Junior Subordinated Debt
Securities, and each holder will be required to include in its gross income
interest, or, if applicable, original issue discount with respect to its
allocable share of the Junior Subordinated Debt Securities.
(2) The Junior Subordinated Debt Securities held by the Trust will be
classified for United States federal income tax purposes as indebtedness of the
Company, and the interest on the Junior Subordinated Debt Securities will be
deductible by the Company.
(3) Although the discussion set forth in the Prospectus under the heading
"UNITED STATES FEDERAL INCOME TAXATION" does not purport to discuss all possible
United States federal income tax consequences of the acquisition, ownership and
disposition of Preferred Securities, in our opinion, such discussion
constitutes, in all material respects, a fair and accurate summary of the United
States federal income tax consequences of the matters addressed therein, based
upon current law and the assumptions stated or referred to therein.
Except as set forth above, we express no opinion to any person as to the
tax consequences, whether federal, state, local or foreign, of the issuance of
the Junior Subordinated Debt Securities, the Preferred Securities, the Common
Securities or any transactions related to or contemplated by any such issuances.
We hereby consent to the filing of this opinion with the Commission as an
Exhibit to the Registration Statement. We also consent to the use of our name
under the headings "LEGAL MATTERS," "UNITED STATES FEDERAL INCOME TAXATION" and
"VALIDITY OF SECURITIES" in the Prospectus (without admitting that we are
"experts" under the 1933 Act or the rules and regulations of the Commission
issued thereunder with respect to any part of the 1994 Registration Statement,
the 1995 Registration Statement or the 1997 Registration Statement). This
opinion may not be used for any other purpose and may not otherwise be disclosed
to or relied upon by any other person without our prior written consent. This
opinion is expressed as of the date hereof unless otherwise expressly stated and
we disclaim any undertaking to
<PAGE>
ReliaStar Financial Corp.
ReliaStar Financing II
June 3, 1997
Page 6
advise you of any subsequent changes of the facts stated or assumed herein or
any changes in applicable law after the date hereof.
Very truly yours,
/s/ Faegre & Benson LLP
FAEGRE & BENSON LLP
<PAGE>
EXHIBIT 25(d)
Registration No. 33-80497
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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) ___
WILMINGTON TRUST COMPANY
(Exact name of trustee as specified in its charter)
Delaware 51-0055023
(State of incorporation) (I.R.S. employer identification no.)
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
(Address of principal executive offices)
Cynthia L. Corliss
Vice President and Trust Counsel
Wilmington Trust Company
Rodney Square North
Wilmington, Delaware 19890
(302) 651-8516
(Name, address and telephone number of agent for service)
RELIASTAR FINANCIAL CORP.
RELIASTAR FINANCING II
(Exact name of obligor as specified in its charter)
41-1620373
Delaware Applied For
(State of incorporation) (I.R.S. employer identification no.)
20 Washington Avenue South
Minneapolis, Minnesota 55401
(Address of principal executive offices) (Zip Code)
____% of Trust Originated Preferred Securities
issued by ReliaStar Financing II
(Title of the indenture securities)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
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.
Federal Deposit Insurance Co. State Bank Commissioner
Five Penn Center Dover, Delaware
Suite #2901
Philadelphia, PA
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
If the obligor is an affiliate of the trustee, describe each
affiliation:
Based upon an examination of the books and records of the trustee
and upon information furnished by the obligor, the obligor is not an
affiliate of the trustee.
ITEM 3. LIST OF EXHIBITS.
List below all exhibits filed as part of this Statement of
Eligibility and Qualification.
A. Copy of the Charter of Wilmington Trust Company, which includes
the certificate of authority of Wilmington Trust Company to
commence business and the authorization of Wilmington Trust
Company to exercise corporate trust powers.
B. Copy of By-Laws of Wilmington Trust Company.
C. Consent of Wilmington Trust Company required by Section 321(b) of
Trust Indenture Act.
D. Copy of most recent Report of Condition of Wilmington Trust
Company.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Wilmington Trust Company, a corporation organized and
existing under the laws of Delaware, has duly caused this Statement of
Eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in the City of Wilmington and State of Delaware on the 29th day
of May, 1997.
WILMINGTON TRUST COMPANY
[SEAL]
Attest: /s/ Debra Eberly By:/s/ Norma P. Closs
----------------------------- ---------------------
Assistant Secretary Name: Norma P. Closs
Title: Vice President
2
<PAGE>
EXHIBIT A
AMENDED CHARTER
Wilmington Trust Company
Wilmington, Delaware
As existing on May 9, 1987
<PAGE>
Amended Charter
or
Act of Incorporation
of
Wilmington Trust Company
Wilmington Trust Company, originally incorporated by an Act of the General
Assembly of the State of Delaware, entitled "An Act to Incorporate the Delaware
Guarantee and Trust Company", approved March 2, A.D. 1901, and the name of which
company was changed to "Wilmington Trust Company" by an amendment filed in the
Office of the Secretary of State on March 18, A.D. 1903, and the Charter or Act
of Incorporation of which company has been from time to time amended and changed
by merger agreements pursuant to the corporation law for state banks and trust
companies of the State of Delaware, does hereby alter and amend its Charter or
Act of Incorporation so that the same as so altered and amended shall in its
entirety read as follows:
First: - The name of this corporation is Wilmington Trust Company.
Second: - The location of its principal office in the State of Delaware is
at Rodney Square North, in the City of Wilmington, County of New Castle;
the name of its resident agent is Wilmington Trust Company whose address
is Rodney Square North, in said City. In addition to such principal
office, the said corporation maintains and operates branch offices in the
City of Newark, New Castle County, Delaware, the Town of Newport, New
Castle County, Delaware, at Claymont, New Castle County, Delaware, at
Greenville, New Castle County Delaware, and at Milford Cross Roads, New
Castle County, Delaware, and shall be empowered to open, maintain and
operate branch offices at Ninth and Shipley Streets, 418 Delaware Avenue,
2120 Market Street, and 3605 Market Street, all in the City of Wilmington,
New Castle County, Delaware, and such other branch offices or places of
business as may be authorized from time to time by the agency or agencies
of the government of the State of Delaware empowered to confer such
authority.
Third: - (a) The nature of the business and the objects and purposes
proposed to be transacted, promoted or carried on by this Corporation are
to do any or all of the things herein mentioned as fully and to the same
extent as natural persons might or could do and in any part of the world,
viz.:
(1) To sue and be sued, complain and defend in any Court of law or
equity and to make and use a common seal, and alter the seal at
pleasure, to hold, purchase, convey, mortgage or otherwise deal in
real and personal estate and property, and to appoint such officers
and agents as the business of the
<PAGE>
Corporation shall require, to make by-laws not inconsistent with the
Constitution or laws of the United States or of this State, to
discount bills, notes or other evidences of debt, to receive deposits
of money, or securities for money, to buy gold and silver bullion and
foreign coins, to buy and sell bills of exchange, and generally to
use, exercise and enjoy all the powers, rights, privileges and
franchises incident to a corporation which are proper or necessary
for the transaction of the business of the Corporation hereby
created.
(2) To insure titles to real and personal property, or any estate or
interests therein, and to guarantee the holder of such property, real
or personal, against any claim or claims, adverse to his interest
therein, and to prepare and give certificates of title for any lands
or premises in the State of Delaware, or elsewhere.
(3) To act as factor, agent, broker or attorney in the receipt,
collection, custody, investment and management of funds, and the
purchase, sale, management and disposal of property of all
descriptions, and to prepare and execute all papers which may be
necessary or proper in such business.
(4) To prepare and draw agreements, contracts, deeds, leases,
conveyances, mortgages, bonds and legal papers of every description,
and to carry on the business of conveyancing in all its branches.
(5) To receive upon deposit for safekeeping money, jewelry, plate,
deeds, bonds and any and all other personal property of every sort
and kind, from executors, administrators, guardians, public officers,
courts, receivers, assignees, trustees, and from all fiduciaries, and
from all other persons and individuals, and from all corporations
whether state, municipal, corporate or private, and to rent boxes,
safes, vaults and other receptacles for such property.
(6) To act as agent or otherwise for the purpose of registering,
issuing, certificating, countersigning, transferring or underwriting
the stock, bonds or other obligations of any corporation,
association, state or municipality, and may receive and manage any
sinking fund therefor on such terms as may be agreed upon between the
two parties, and in like manner may act as Treasurer of any
corporation or municipality.
(7) To act as Trustee under any deed of trust, mortgage, bond or
other instrument issued by any state, municipality, body politic,
corporation, association or person, either alone or in conjunction
with any other person or persons, corporation or corporations.
2
<PAGE>
(8) To guarantee the validity, performance or effect of any contract
or agreement, and the fidelity of persons holding places of
responsibility or trust; to become surety for any person, or persons,
for the faithful performance of any trust, office, duty, contract or
agreement, either by itself or in conjunction with any other person,
or persons, corporation, or corporations, or in like manner become
surety upon any bond, recognizance, obligation, judgment, suit,
order, or decree to be entered in any court of record within the
State of Delaware or elsewhere, or which may now or hereafter be
required by any law, judge, officer or court in the State of Delaware
or elsewhere.
(9) To act by any and every method of appointment as trustee,
trustee in bankruptcy, receiver, assignee, assignee in bankruptcy,
executor, administrator, guardian, bailee, or in any other trust
capacity in the receiving, holding, managing, and disposing of any
and all estates and property, real, personal or mixed, and to be
appointed as such trustee, trustee in bankruptcy, receiver, assignee,
assignee in bankruptcy, executor, administrator, guardian or bailee
by any persons, corporations, court, officer, or authority, in the
State of Delaware or elsewhere; and whenever this Corporation is so
appointed by any person, corporation, court, officer or authority
such trustee, trustee in bankruptcy, receiver, assignee, assignee in
bankruptcy, executor, administrator, guardian, bailee, or in any
other trust capacity, it shall not be required to give bond with
surety, but its capital stock shall be taken and held as security for
the performance of the duties devolving upon it by such appointment.
(10) And for its care, management and trouble, and the exercise of
any of its powers hereby given, or for the performance of any of the
duties which it may undertake or be called upon to perform, or for
the assumption of any responsibility the said Corporation may be
entitled to receive a proper compensation.
(11) To purchase, receive, hold and own bonds, mortgages,
debentures, shares of capital stock, and other securities,
obligations, contracts and evidences of indebtedness, of any private,
public or municipal corporation within and without the State of
Delaware, or of the Government of the United States, or of any state,
territory, colony, or possession thereof, or of any foreign
government or country; to receive, collect, receipt for, and dispose
of interest, dividends and income upon and from any of the bonds,
mortgages, debentures, notes, shares of capital stock, securities,
obligations, contracts, evidences of indebtedness and other property
held and owned by it, and to exercise in respect of all such bonds,
mortgages, debentures, notes, shares of capital stock, securities,
obligations, contracts, evidences of indebtedness and other property,
any and all the rights, powers and privileges of individual
3
<PAGE>
owners thereof, including the right to vote thereon; to invest and
deal in and with any of the moneys of the Corporation upon such
securities and in such manner as it may think fit and proper, and
from time to time to vary or realize such investments; to issue bonds
and secure the same by pledges or deeds of trust or mortgages of or
upon the whole or any part of the property held or owned by the
Corporation, and to sell and pledge such bonds, as and when the Board
of Directors shall determine, and in the promotion of its said
corporate business of investment and to the extent authorized by law,
to lease, purchase, hold, sell, assign, transfer, pledge, mortgage
and convey real and personal property of any name and nature and any
estate or interest therein.
(b) In furtherance of, and not in limitation, of the powers conferred by
the laws of the State of Delaware, it is hereby expressly provided that
the said Corporation shall also have the following powers:
(1) To do any or all of the things herein set forth, to the same
extent as natural persons might or could do, and in any part of the
world.
(2) To acquire the good will, rights, property and franchises and to
undertake the whole or any part of the assets and liabilities of any
person, firm, association or corporation, and to pay for the same in
cash, stock of this Corporation, bonds or otherwise; to hold or in
any manner to dispose of the whole or any part of the property so
purchased; to conduct in any lawful manner the whole or any part of
any business so acquired, and to exercise all the powers necessary or
convenient in and about the conduct and management of such business.
(3) To take, hold, own, deal in, mortgage or otherwise lien, and to
lease, sell, exchange, transfer, or in any manner whatever dispose of
property, real, personal or mixed, wherever situated.
(4) To enter into, make, perform and carry out contracts of every
kind with any person, firm, association or corporation, and, without
limit as to amount, to draw, make, accept, endorse, discount,
execute and issue promissory notes, drafts, bills of exchange,
warrants, bonds, debentures, and other negotiable or transferable
instruments.
(5) To have one or more offices, to carry on all or any of its
operations and businesses, without restriction to the same extent as
natural persons might or could do, to purchase or otherwise acquire,
to hold, own, to mortgage, sell, convey or otherwise dispose of, real
and personal property, of every class and description, in any State,
District, Territory or Colony of the United States, and in any
foreign country or place.
4
<PAGE>
(6) It is the intention that the objects, purposes and powers
specified and clauses contained in this paragraph shall (except where
otherwise expressed in said paragraph) be nowise limited or
restricted by reference to or inference from the terms of any other
clause of this or any other paragraph in this charter, but that the
objects, purposes and powers specified in each of the clauses of this
paragraph shall be regarded as independent objects, purposes and
powers.
Fourth: - (a) The total number of shares of all classes of stock which
the Corporation shall have authority to issue is forty-one million
(41,000,000) shares, consisting of:
(1) One million (1,000,000) shares of Preferred stock, par value
$10.00 per share (hereinafter referred to as "Preferred Stock"); and
(2) Forty million (40,000,000) shares of Common Stock, par value
$1.00 per share (hereinafter referred to as "Common Stock").
(b) Shares of Preferred Stock may be issued from time to time in one or
more series as may from time to time be determined by the Board of
Directors each of said series to be distinctly designated. All shares of
any one series of Preferred Stock shall be alike in every particular,
except that there may be different dates from which dividends, if any,
thereon shall be cumulative, if made cumulative. The voting powers and
the preferences and relative, participating, optional and other special
rights of each such series, and the qualifications, limitations or
restrictions thereof, if any, may differ from those of any and all other
series at any time outstanding; and, subject to the provisions of
subparagraph 1 of Paragraph (c) of this Article Fourth, the Board of
Directors of the Corporation is hereby expressly granted authority to fix
by resolution or resolutions adopted prior to the issuance of any shares
of a particular series of Preferred Stock, the voting powers and the
designations, preferences and relative, optional and other special rights,
and the qualifications, limitations and restrictions of such series,
including, but without limiting the generality of the foregoing, the
following:
(1) The distinctive designation of, and the number of shares of
Preferred Stock which shall constitute such series, which number may
be increased (except where otherwise provided by the Board of
Directors) or decreased (but not below the number of shares thereof
then outstanding) from time to time by like action of the Board of
Directors;
(2) The rate and times at which, and the terms and conditions on
which, dividends, if any, on Preferred Stock of such series shall be
paid, the extent of the preference or relation, if any, of such
dividends to the dividends payable on any other class or classes, or
series of the same or other class of
5
<PAGE>
stock and whether such dividends shall be cumulative or non-
cumulative;
(3) The right, if any, of the holders of Preferred Stock of such
series to convert the same into or exchange the same for, shares of
any other class or classes or of any series of the same or any other
class or classes of stock of the Corporation and the terms and
conditions of such conversion or exchange;
(4) Whether or not Preferred Stock of such series shall be subject
to redemption, and the redemption price or prices and the time or
times at which, and the terms and conditions on which, Preferred
Stock of such series may be redeemed.
(5) The rights, if any, of the holders of Preferred Stock of such
series upon the voluntary or involuntary liquidation, merger,
consolidation, distribution or sale of assets, dissolution or
winding-up, of the Corporation.
(6) The terms of the sinking fund or redemption or purchase account,
if any, to be provided for the Preferred Stock of such series; and
(7) The voting powers, if any, of the holders of such series of
Preferred Stock which may, without limiting the generality of the
foregoing include the right, voting as a series or by itself or
together with other series of Preferred Stock or all series of
Preferred Stock as a class, to elect one or more directors of the
Corporation if there shall have been a default in the payment of
dividends on any one or more series of Preferred Stock or under such
circumstances and on such conditions as the Board of Directors may
determine.
(c) (1) After the requirements with respect to preferential dividends on
the Preferred Stock (fixed in accordance with the provisions of section
(b) of this Article Fourth), if any, shall have been met and after the
Corporation shall have complied with all the requirements, if any, with
respect to the setting aside of sums as sinking funds or redemption or
purchase accounts (fixed in accordance with the provisions of section (b)
of this Article Fourth), and subject further to any conditions which may
be fixed in accordance with the provisions of section (b) of this Article
Fourth, then and not otherwise the holders of Common Stock shall be
entitled to receive such dividends as may be declared from time to time by
the Board of Directors.
(2) After distribution in full of the preferential amount, if any,
(fixed in accordance with the provisions of section (b) of this
Article Fourth), to be distributed to the holders of Preferred Stock
in the event of voluntary or involuntary liquidation, distribution or
sale of assets, dissolution or winding-up, of the Corporation, the
holders of the Common Stock shall be entitled to
6
<PAGE>
receive all of the remaining assets of the Corporation, tangible and
intangible, of whatever kind available for distribution to
stockholders ratably in proportion to the number of shares of Common
Stock held by them respectively.
(3) Except as may otherwise be required by law or by the provisions
of such resolution or resolutions as may be adopted by the Board of
Directors pursuant to section (b) of this Article Fourth, each holder
of Common Stock shall have one vote in respect of each share of
Common Stock held on all matters voted upon by the stockholders.
(d) No holder of any of the shares of any class or series of stock or of
options, warrants or other rights to purchase shares of any class or
series of stock or of other securities of the Corporation shall have any
preemptive right to purchase or subscribe for any unissued stock of any
class or series or any additional shares of any class or series to be
issued by reason of any increase of the authorized capital stock of the
Corporation of any class or series, or bonds, certificates of
indebtedness, debentures or other securities convertible into or
exchangeable for stock of the Corporation of any class or series, or
carrying any right to purchase stock of any class or series, but any such
unissued stock, additional authorized issue of shares of any class or
series of stock or securities convertible into or exchangeable for stock,
or carrying any right to purchase stock, may be issued and disposed of
pursuant to resolution of the Board of Directors to such persons, firms,
corporations or associations, whether such holders or others, and upon
such terms as may be deemed advisable by the Board of Directors in the
exercise of its sole discretion.
(e) The relative powers, preferences and rights of each series of
Preferred Stock in relation to the relative powers, preferences and rights
of each other series of Preferred Stock shall, in each case, be as fixed
from time to time by the Board of Directors in the resolution or
resolutions adopted pursuant to authority granted in section (b) of this
Article Fourth and the consent, by class or series vote or otherwise, of
the holders of such of the series of Preferred Stock as are from time to
time outstanding shall not be required for the issuance by the Board of
Directors of any other series of Preferred Stock whether or not the
powers, preferences and rights of such other series shall be fixed by the
Board of Directors as senior to, or on a parity with, the powers,
preferences and rights of such outstanding series, or any of them;
provided, however, that the Board of Directors may provide in the
resolution or resolutions as to any series of Preferred Stock adopted
pursuant to section (b) of this Article Fourth that the consent of the
holders of a majority (or such greater proportion as shall be therein
fixed) of the outstanding shares of such series voting thereon shall be
required for the issuance of any or all other series of Preferred Stock.
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(f) Subject to the provisions of section (e), shares of any series of
Preferred Stock may be issued from time to time as the Board of Directors
of the Corporation shall determine and on such terms and for such
consideration as shall be fixed by the Board of Directors.
(g) Shares of Common Stock may be issued from time to time as the Board
of Directors of the Corporation shall determine and on such terms and for
such consideration as shall be fixed by the Board of Directors.
(h) The authorized amount of shares of Common Stock and of Preferred
Stock may, without a class or series vote, be increased or decreased from
time to time by the affirmative vote of the holders of a majority of the
stock of the Corporation entitled to vote thereon.
Fifth: - (a) The business and affairs of the Corporation shall be
conducted and managed by a Board of Directors. The number of directors
constituting the entire Board shall be not less than five nor more than
twenty-five as fixed from time to time by vote of a majority of the whole
Board, provided, however, that the number of directors shall not be
reduced so as to shorten the term of any director at the time in office,
and provided further, that the number of directors constituting the whole
Board shall be twenty-four until otherwise fixed by a majority of the
whole Board.
(b) The Board of Directors shall be divided into three classes, as nearly
equal in number as the then total number of directors constituting the
whole Board permits, with the term of office of one class expiring each
year. At the annual meeting of stockholders in 1982, directors of the
first class shall be elected to hold office for a term expiring at the
next succeeding annual meeting, directors of the second class shall be
elected to hold office for a term expiring at the second succeeding annual
meeting and directors of the third class shall be elected to hold office
for a term expiring at the third succeeding annual meeting. Any vacancies
in the Board of Directors for any reason, and any newly created
directorships resulting from any increase in the directors, may be filled
by the Board of Directors, acting by a majority of the directors then in
office, although less than a quorum, and any directors so chosen shall
hold office until the next annual election of directors. At such
election, the stockholders shall elect a successor to such director to
hold office until the next election of the class for which such director
shall have been chosen and until his successor shall be elected and
qualified. No decrease in the number of directors shall shorten the term
of any incumbent director.
(c) Notwithstanding any other provisions of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and notwithstanding the
fact that some lesser percentage may be specified by law, this Charter or
Act of Incorporation or the By-Laws of the Corporation), any director or
the entire Board of Directors of the
8
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Corporation may be removed at any time without cause, but only by the
affirmative vote of the holders of two-thirds or more of the outstanding
shares of capital stock of the Corporation entitled to vote generally in
the election of directors (considered for this purpose as one class) cast
at a meeting of the stockholders called for that purpose.
(d) Nominations for the election of directors may be made by the Board of
Directors or by any stockholder entitled to vote for the election of
directors. Such nominations shall be made by notice in writing, delivered
or mailed by first class United States mail, postage prepaid, to the
Secretary of the Corporation not less than 14 days nor more than 50 days
prior to any meeting of the stockholders called for the election of
directors; provided, however, that if less than 21 days' notice of the
meeting is given to stockholders, such written notice shall be delivered
or mailed, as prescribed, to the Secretary of the Corporation not later
than the close of the seventh day following the day on which notice of the
meeting was mailed to stockholders. Notice of nominations which are
proposed by the Board of Directors shall be given by the Chairman on
behalf of the Board.
(e) Each notice under subsection (d) shall set forth (i) the name, age,
business address and, if known, residence address of each nominee proposed
in such notice, (ii) the principal occupation or employment of such
nominee and (iii) the number of shares of stock of the Corporation which
are beneficially owned by each such nominee.
(f) The Chairman of the meeting may, if the facts warrant, determine and
declare to the meeting that a nomination was not made in accordance with
the foregoing procedure, and if he should so determine, he shall so
declare to the meeting and the defective nomination shall be disregarded.
(g) No action required to be taken or which may be taken at any annual or
special meeting of stockholders of the Corporation may be taken without a
meeting, and the power of stockholders to consent in writing, without a
meeting, to the taking of any action is specifically denied.
Sixth: - The Directors shall choose such officers, agent and servants as
may be provided in the By-Laws as they may from time to time find
necessary or proper.
Seventh: - The Corporation hereby created is hereby given the same powers,
rights and privileges as may be conferred upon corporations organized
under the Act entitled "An Act Providing a General Corporation Law",
approved March 10, 1899, as from time to time amended.
Eighth: - This Act shall be deemed and taken to be a private Act.
9
<PAGE>
Ninth: - This Corporation is to have perpetual existence.
Tenth: - The Board of Directors, by resolution passed by a majority of the
whole Board, may designate any of their number to constitute an Executive
Committee, which Committee, to the extent provided in said resolution, or
in the By-Laws of the Company, shall have and may exercise all of the
powers of the Board of Directors in the management of the business and
affairs of the Corporation, and shall have power to authorize the seal of
the Corporation to be affixed to all papers which may require it.
Eleventh: - The private property of the stockholders shall not be liable
for the payment of corporate debts to any extent whatever.
Twelfth: - The Corporation may transact business in any part of the world.
Thirteenth: - The Board of Directors of the Corporation is expressly
authorized to make, alter or repeal the By-Laws of the Corporation by a
vote of the majority of the entire Board. The stockholders may make,
alter or repeal any By-Law whether or not adopted by them, provided
however, that any such additional By-Laws, alterations or repeal may be
adopted only by the affirmative vote of the holders of two-thirds or more
of the outstanding shares of capital stock of the Corporation entitled to
vote generally in the election of directors (considered for this purpose
as one class).
Fourteenth: - Meetings of the Directors may be held outside of the State
of Delaware at such places as may be from time to time designated by the
Board, and the Directors may keep the books of the Company outside of the
State of Delaware at such places as may be from time to time designated by
them.
Fifteenth: - (a) In addition to any affirmative vote required by law, and
except as otherwise expressly provided in sections (b) and (c) of this
Article Fifteenth:
(A) any merger or consolidation of the Corporation or any Subsidiary
(as hereinafter defined) with or into (i) any Interested Stockholder
(as hereinafter defined) or (ii) any other corporation (whether or
not itself an Interested Stockholder), which, after such merger or
consolidation, would be an Affiliate (as hereinafter defined) of an
Interested Stockholder, or
(B) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of related transactions)
to or with any Interested Stockholder or any Affiliate of any
Interested Stockholder of any assets of the Corporation or any
Subsidiary having an aggregate fair market value of $1,000,000 or
more, or
10
<PAGE>
(C) the issuance or transfer by the Corporation or any Subsidiary
(in one transaction or a series of related transactions) of any
securities of the Corporation or any Subsidiary to any Interested
Stockholder or any Affiliate of any Interested Stockholder in
exchange for cash, securities or other property (or a combination
thereof) having an aggregate fair market value of $1,000,000 or more,
or
(D) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation, or
(E) any reclassification of securities (including any reverse stock
split), or recapitalization of the Corporation, or any merger or
consolidation of the Corporation with any of its Subsidiaries or any
similar transaction (whether or not with or into or otherwise
involving an Interested Stockholder) which has the effect, directly
or indirectly, of increasing the proportionate share of the
outstanding shares of any class of equity or convertible securities
of the Corporation or any Subsidiary which is directly or indirectly
owned by any Interested Stockholder, or any Affiliate of any
Interested Stockholder,
shall require the affirmative vote of the holders of at least two-thirds of the
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, considered for the purpose of this
Article Fifteenth as one class ("Voting Shares"). Such affirmative vote shall
be required notwithstanding the fact that no vote may be required, or that some
lesser percentage may be specified, by law or in any agreement with any national
securities exchange or otherwise.
(2) The term "business combination" as used in this Article
Fifteenth shall mean any transaction which is referred to any one or
more of clauses (A) through (E) of paragraph 1 of the section (a).
(b) The provisions of section (a) of this Article Fifteenth shall
not be applicable to any particular business combination and such
business combination shall require only such affirmative vote as is
required by law and any other provisions of the Charter or Act of
Incorporation of By-Laws if such business combination has been
approved by a majority of the whole Board.
(c) For the purposes of this Article Fifteenth:
(1) A "person" shall mean any individual firm, corporation or other
entity.
(2) "Interested Stockholder" shall mean, in respect of any business
combination, any person (other than the Corporation or any Subsidiary) who
or which as of the record date for the determination of stockholders
entitled to notice of and to vote on
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such business combination, or immediately prior to the consummation of any
such transaction:
(A) is the beneficial owner, directly or indirectly, of more than
10% of the Voting Shares, or
(B) is an Affiliate of the Corporation and at any time within two
years prior thereto was the beneficial owner, directly or indirectly,
of not less than 10% of the then outstanding voting Shares, or
(C) is an assignee of or has otherwise succeeded in any share of
capital stock of the Corporation which were at any time within two
years prior thereto beneficially owned by any Interested Stockholder,
and such assignment or succession shall have occurred in the course
of a transaction or series of transactions not involving a public
offering within the meaning of the Securities Act of 1933.
(3) A person shall be the "beneficial owner" of any Voting Shares:
(A) which such person or any of its Affiliates and Associates (as
hereafter defined) beneficially own, directly or indirectly, or
(B) which such person or any of its Affiliates or Associates has (i)
the right to acquire (whether such right is exercisable immediately
or only after the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion
rights, exchange rights, warrants or options, or otherwise, or (ii)
the right to vote pursuant to any agreement, arrangement or
understanding, or
(C) which are beneficially owned, directly or indirectly, by any
other person with which such first mentioned person or any of its
Affiliates or Associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or
disposing of any shares of capital stock of the Corporation.
(4) The outstanding Voting Shares shall include shares deemed owned
through application of paragraph (3) above but shall not include any other
Voting Shares which may be issuable pursuant to any agreement, or upon
exercise of conversion rights, warrants or options or otherwise.
(5) "Affiliate" and "Associate" shall have the respective meanings given
those terms in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as in effect on December 31, 1981.
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(6) "Subsidiary" shall mean any corporation of which a majority of any
class of equity security (as defined in Rule 3a11-1 of the General Rules
and Regulations under the Securities Exchange Act of 1934, as in effect in
December 31, 1981) is owned, directly or indirectly, by the Corporation;
provided, however, that for the purposes of the definition of Investment
Stockholder set forth in paragraph (2) of this section (c), the term
"Subsidiary" shall mean only a corporation of which a majority of each
class of equity security is owned, directly or indirectly, by the
Corporation.
(d) majority of the directors shall have the power and duty to
determine for the purposes of this Article Fifteenth on the basis of
information known to them, (1) the number of Voting Shares
beneficially owned by any person (2) whether a person is an Affiliate
or Associate of another, (3) whether a person has an agreement,
arrangement or understanding with another as to the matters referred
to in paragraph (3) of section (c), or (4) whether the assets subject
to any business combination or the consideration received for the
issuance or transfer of securities by the Corporation, or any
Subsidiary has an aggregate fair market value of $1,000,000 or more.
(e) Nothing contained in this Article Fifteenth shall be construed
to relieve any Interested Stockholder from any fiduciary obligation
imposed by law.
Sixteenth: Notwithstanding any other provision of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and in addition to any
other vote that may be required by law, this Charter or Act of
Incorporation by the By-Laws), the affirmative vote of the holders of at
least two-thirds of the outstanding shares of the capital stock of the
Corporation entitled to vote generally in the election of directors
(considered for this purpose as one class) shall be required to amend,
alter or repeal any provision of Articles Fifth, Thirteenth, Fifteenth or
Sixteenth of this Charter or Act of Incorporation.
Seventeenth: (a) a Director of this Corporation shall not be liable to
the Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a Director, except to the extent such exemption from
liability or limitation thereof is not permitted under the Delaware
General Corporation Laws as the same exists or may hereafter be amended.
(b) Any repeal or modification of the foregoing paragraph shall not
adversely affect any right or protection of a Director of the
Corporation existing hereunder with respect to any act or omission
occurring prior to the time of such repeal or modification."
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EXHIBIT B
BY-LAWS
WILMINGTON TRUST COMPANY
WILMINGTON, DELAWARE
As existing on January 16, 1997
<PAGE>
BY-LAWS OF WILMINGTON TRUST COMPANY
ARTICLE I
Stockholders' Meetings
Section 1. The Annual Meeting of Stockholders shall be held on the third
Thursday in April each year at the principal office at the Company or at such
other date, time, or place as may be designated by resolution by the Board of
Directors.
Section 2. Special meetings of all stockholders may be called at any time
by the Board of Directors, the Chairman of the Board or the President.
Section 3. Notice of all meetings of the stockholders shall be given by
mailing to each stockholder at least ten (10) days before said meeting, at his
last known address, a written or printed notice fixing the time and place of
such meeting.
Section 4. A majority in the amount of the capital stock of the Company
issued and outstanding on the record date, as herein determined, shall
constitute a quorum at all meetings of stockholders for the transaction of any
business, but the holders of a small number of shares may adjourn, from time to
time, without further notice, until a quorum is secured. At each annual or
special meeting of stockholders, each stockholder shall be entitled to one vote,
either in person or by proxy, for each shares of stock registered in the
stockholder's name on the books of the Company on the record date for any such
meeting as determined herein.
ARTICLE II
Directors
Section 1. The number and classification of the Board of Directors shall
be as set forth in the Charter of the Bank.
Section 2. No person who has attained the age of seventy-two (72) years
shall be nominated for election to the Board of Directors of the Company,
provided, however, that this limitation shall not apply to any person who was
serving as director of the Company on September 16, 1971.
Section 3. The class of Directors so elected shall hold office for three
years or until their successors are elected and qualified.
Section 4. The affairs and business of the Company shall be managed and
conducted by the Board of Directors.
Section 5. The Board of Directors shall meet at the principal office of
the Company or elsewhere in its discretion at such times to be determined by a
majority of its
<PAGE>
members, or at the call of the Chairman of the Board of Directors or the
President.
Section 6. Special meetings of the Board of Directors may be called at
any time by the Chairman of the Board of Directors or by the President, and
shall be called upon the written request of a majority of the directors.
Section 7. A majority of the directors elected and qualified shall be
necessary to constitute a quorum for the transaction of business at any meeting
of the Board of Directors.
Section 8. Written notice shall be sent by mail to each director of any
special meeting of the Board of Directors, and of any change in the time or
place of any regular meeting, stating the time and place of such meeting, which
shall be mailed not less than two days before the time of holding such meeting.
Section 9. In the event of the death, resignation, removal, inability to
act, or disqualification of any director, the Board of Directors, although less
than a quorum, shall have the right to elect the successor who shall hold office
for the remainder of the full term of the class of directors in which the
vacancy occurred, and until such director's successor shall have been duly
elected and qualified.
Section 10. The Board of Directors at its first meeting after its
election by the stockholders shall appoint an Executive Committee, a Trust
Committee, an Audit Committee and a Compensation Committee, and shall elect from
its own members a Chairman of the Board of Directors and a President who may be
the same person. The Board of Directors shall also elect at such meeting a
Secretary and a Treasurer, who may be the same person, may appoint at any time
such other committees and elect or appoint such other officers as it may deem
advisable. The Board of Directors may also elect at such meeting one or more
Associate Directors.
Section 11. The Board of Directors may at any time remove, with or
without cause, any member of any Committee appointed by it or any associate
director or officer elected by it and may appoint or elect his successor.
Section 12. The Board of Directors may designate an officer to be in
charge of such of the departments or division of the Company as it may deem
advisable.
ARTICLE III
Committees
Section I. Executive Committee
(A) The Executive Committee shall be composed of not more than
nine members who shall be selected by the Board of Directors from its own
members and who
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shall hold office during the pleasure of the Board.
(B) The Executive Committee shall have all the powers of the Board of
Directors when it is not in session to transact all business for and in behalf
of the Company that may be brought before it.
(C) The Executive Committee shall meet at the principal office of the
Company or elsewhere in its discretion at such times to be determined by a
majority of its members, or at the call of the Chairman of the Executive
Committee or at the call of the Chairman of the Board of Directors. The
majority of its members shall be necessary to constitute a quorum for the
transaction of business. Special meetings of the Executive Committee may be
held at any time when a quorum is present.
(D) Minutes of each meeting of the Executive Committee shall be kept
and submitted to the Board of Directors at its next meeting.
(E) The Executive Committee shall advise and superintend all
investments that may be made of the funds of the Company, and shall direct the
disposal of the same, in accordance with such rules and regulations as the Board
of Directors from time to time make.
(F) In the event of a state of disaster of sufficient severity to
prevent the conduct and management of the affairs and business of the Company by
its directors and officers as contemplated by these By-Laws any two available
members of the Executive Committee as constituted immediately prior to such
disaster shall constitute a quorum of that Committee for the full conduct and
management of the affairs and business of the Company in accordance with the
provisions of Article III of these By-Laws; and if less than three members of
the Trust Committee is constituted immediately prior to such disaster shall be
available for the transaction of its business, such Executive Committee shall
also be empowered to exercise all of the powers reserved to the Trust Committee
under Article III Section 2 hereof. In the event of the unavailability, at such
time, of a minimum of two members of such Executive Committee, any three
available directors shall constitute the Executive Committee for the full
conduct and management of the affairs and business of the Company in accordance
with the foregoing provisions of this Section. This By-Law shall be subject to
implementation by Resolutions of the Board of Directors presently existing or
hereafter passed from time to time for that purpose, and any provisions of these
By-Laws (other than this Section) and any resolutions which are contrary to the
provisions of this Section or to the provisions of any such implementary
Resolutions shall be suspended during such a disaster period until it shall be
determined by any interim Executive Committee acting under this section that it
shall be to the advantage of the Company to resume the conduct and management of
its affairs and business under all of the other provisions of these By-Laws.
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Section 2. Trust Committee
(A) The Trust Committee shall be composed of not more than thirteen
members who shall be selected by the Board of Directors, a majority of whom
shall be members of the Board of Directors and who shall hold office during the
pleasure of the Board.
(B) The Trust Committee shall have general supervision over the Trust
Department and the investment of trust funds, in all matters, however, being
subject to the approval of the Board of Directors.
(C) The Trust Committee shall meet at the principal office of the
Company or elsewhere in its discretion at such times to be determined by a
majority of its members or at the call of its chairman. A majority of its
members shall be necessary to constitute a quorum for the transaction of
business.
(D) Minutes of each meeting of the Trust Committee shall be kept
and promptly submitted to the Board of Directors.
(E) The Trust Committee shall have the power to appoint Committees
and/or designate officers or employees of the Company to whom supervision over
the investment of trust funds may be delegated when the Trust Committee is not
in session.
Section 3. Audit Committee
(A) The Audit Committee shall be composed of five members who shall
be selected by the Board of Directors from its own members, none of whom shall
be an officer of the Company, and shall hold office at the pleasure of the
Board.
(B) The Audit Committee shall have general supervision over the Audit
Division in all matters however subject to the approval of the Board of
Directors; it shall consider all matters brought to its attention by the officer
in charge of the Audit Division, review all reports of examination of the
Company made by any governmental agency or such independent auditor employed for
that purpose, and make such recommendations to the Board of Directors with
respect thereto or with respect to any other matters pertaining to auditing the
Company as it shall deem desirable.
(C) The Audit Committee shall meet whenever and wherever the majority
of its members shall deem it to be proper for the transaction of its business,
and a majority of its Committee shall constitute a quorum.
Section 4. Compensation Committee
(A) The Compensation Committee shall be composed of not more than
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<PAGE>
five (5) members who shall be selected by the Board of Directors from its own
members who are not officers of the Company and who shall hold office during the
pleasure of the Board.
(B) The Compensation Committee shall in general advise upon all
matters of policy concerning the Company brought to its attention by the
management and from time to time review the management of the Company, major
organizational matters, including salaries and employee benefits and
specifically shall administer the Executive Incentive Compensation Plan.
(C) Meetings of the Compensation Committee may be called at any time
by the Chairman of the Compensation Committee, the Chairman of the Board of
Directors, or the President of the Company.
Section 5. Associate Directors
(A) Any person who has served as a director may be elected by the
Board of Directors as an associate director, to serve during the pleasure of the
Board.
(B) An associate director shall be entitled to attend all directors
meetings and participate in the discussion of all matters brought to the Board,
with the exception that he would have no right to vote. An associate director
will be eligible for appointment to Committees of the Company, with the
exception of the Executive Committee, Audit Committee and Compensation
Committee, which must be comprised solely of active directors.
Section 6. Absence or Disqualification of Any Member of a Committee
(A) In the absence or disqualification of any member of any Committee
created under Article III of the By-Laws of this Company, the member or members
thereof present at any meeting and not disqualified from voting, whether or not
he or they constitute a quorum, may unanimously appoint another member of the
Board of Directors to act at the meeting in the place of any such absence or
disqualified member.
ARTICLE IV
Officers
Section 1. The Chairman of the Board of Directors shall preside at all
meetings of the Board and shall have such further authority and powers and shall
perform such duties as the Board of Directors may from time to time confer and
direct. He shall also exercise such powers and perform such duties as may from
time to time be agreed upon between himself and the President of the Company.
Section 2. The Vice Chairman of the Board. The Vice Chairman of the
Board of
5
<PAGE>
Directors shall preside at all meetings of the Board of Directors at which the
Chairman of the Board shall not be present and shall have such further authority
and powers and shall perform such duties as the Board of Directors or the
Chairman of the Board may from time to time confer and direct.
Section 3. The President shall have the powers and duties pertaining to
the office of the President conferred or imposed upon him by statute or assigned
to him by the Board of Directors in the absence of the Chairman of the Board the
President shall have the powers and duties of the Chairman of the Board.
Section 4. The Chairman of the Board of Directors or the President as
designated by the Board of Directors, shall carry into effect all legal
directions of the Executive Committee and of the Board of Directors, and shall
at all times exercise general supervision over the interest, affairs and
operations of the Company and perform all duties incident to his office.
Section 5. There may be one or more Vice Presidents, however denominated
by the Board of Directors, who may at any time perform all the duties of the
Chairman of the Board of Directors and/or the President and such other powers
and duties as may from time to time be assigned to them by the Board of
Directors, the Executive Committee, the Chairman of the Board or the President
and by the officer in charge of the department or division to which they are
assigned.
Section 6. The Secretary shall attend to the giving of notice of meetings
of the stockholders and the Board of Directors, as well as the Committees
thereof, to the keeping of accurate minutes of all such meetings and to
recording the same in the minute books of the Company. In addition to the other
notice requirements of these By-Laws and as may be practicable under the
circumstances, all such notices shall be in writing and mailed well in advance
of the scheduled date of any other meeting. He shall have custody of the
corporate seal and shall affix the same to any documents requiring such
corporate seal and to attest the same.
Section 7. The Treasurer shall have general supervision over all assets
and liabilities of the Company. He shall be custodian of and responsible for
all monies, funds and valuables of the Company and for the keeping of proper
records of the evidence of property or indebtedness and of all the transactions
of the Company. He shall have general supervision of the expenditures of the
Company and shall report to the Board of Directors at each regular meeting of
the condition of the Company, and perform such other duties as may be assigned
to him from time to time by the Board of Directors of the Executive Committee.
Section 8. There may be a Controller who shall exercise general
supervision over the internal operations of the Company, including accounting,
and shall render to the Board of Directors at appropriate times a report
relating to the general condition and internal operations of the Company.
6
<PAGE>
There may be one or more subordinate accounting or controller officers
however denominated, who may perform the duties of the Controller and such
duties as may be prescribed by the Controller.
Section 9. The officer designated by the Board of Directors to be in
charge of the Audit Division of the Company with such title as the Board of
Directors shall prescribe, shall report to and be directly responsible only to
the Board of Directors.
There shall be an Auditor and there may be one or more Audit Officers,
however denominated, who may perform all the duties of the Auditor and such
duties as may be prescribed by the officer in charge of the Audit Division.
Section 10. There may be one or more officers, subordinate in rank to all
Vice Presidents with such functional titles as shall be determined from time to
time by the Board of Directors, who shall ex officio hold the office Assistant
Secretary of this Company and who may perform such duties as may be prescribed
by the officer in charge of the department or division to whom they are
assigned.
Section 11. The powers and duties of all other officers of the Company
shall be those usually pertaining to their respective offices, subject to the
direction of the Board of Directors, the Executive Committee, Chairman of the
Board of Directors or the President and the officer in charge of the department
or division to which they are assigned.
ARTICLE V
Stock and Stock Certificates
Section 1. Shares of stock shall be transferrable on the books of the
Company and a transfer book shall be kept in which all transfers of stock shall
be recorded.
Section 2. Certificate of stock shall bear the signature of the President
or any Vice President, however denominated by the Board of Directors and
countersigned by the Secretary or Treasurer or an Assistant Secretary, and the
seal of the corporation shall be engraved thereon. Each certificate shall
recite that the stock represented thereby is transferrable only upon the books
of the Company by the holder thereof or his attorney, upon surrender of the
certificate properly endorsed. Any certificate of stock surrendered to the
Company shall be cancelled at the time of transfer, and before a new certificate
or certificates shall be issued in lieu thereof. Duplicate certificates of
stock shall be issued only upon giving such security as may be satisfactory to
the Board of Directors or the Executive Committee.
Section 3. The Board of Directors of the Company is authorized to fix in
advance a record date for the determination of the stockholders entitled to
notice of, and to vote at, any meeting of stockholders and any adjournment
thereof, or entitled to receive payment of
7
<PAGE>
any dividend, or to any allotment or rights, or to exercise any rights in
respect of any change, conversion or exchange of capital stock, or in connection
with obtaining the consent of stockholders for any purpose, which record date
shall not be more than 60 nor less than 10 days proceeding the date of any
meeting of stockholders or the date for the payment of any dividend, or the date
for the allotment of rights, or the date when any change or conversion or
exchange of capital stock shall go into effect, or a date in connection with
obtaining such consent.
ARTICLE VI
Seal
Section 1. The corporate seal of the Company shall be in the following
form:
Between two concentric circles the words
"Wilmington Trust Company" within the inner
circle the words "Wilmington, Delaware."
ARTICLE VII
Fiscal Year
Section 1. The fiscal year of the Company shall be the calendar year.
ARTICLE VIII
Execution of Instruments of the Company
Section 1. The Chairman of the Board, the President or any Vice
President, however denominated by the Board of Directors, shall have full power
and authority to enter into, make, sign, execute, acknowledge and/or deliver and
the Secretary or any Assistant Secretary shall have full power and authority to
attest and affix the corporate seal of the Company to any and all deeds,
conveyances, assignments, releases, contracts, agreements, bonds, notes,
mortgages and all other instruments incident to the business of this Company or
in acting as executor, administrator, guardian, trustee, agent or in any other
fiduciary or representative capacity by any and every method of appointment or
by whatever person, corporation, court officer or authority in the State of
Delaware, or elsewhere, without any specific authority, ratification, approval
or confirmation by the Board of Directors or the Executive Committee, and any
and all such instruments shall have the same force and validity as though
expressly authorized by the Board of Directors and/or the Executive Committee.
8
<PAGE>
ARTICLE IX
Compensation of Directors and Members of Committees
Section 1. Directors and associate directors of the Company, other than
salaried officers of the Company, shall be paid such reasonable honoraria or
fees for attending meetings of the Board of Directors as the Board of Directors
may from time to time determine. Directors and associate directors who serve as
members of committees, other than salaried employees of the Company, shall be
paid such reasonable honoraria or fees for services as members of committees as
the Board of Directors shall from time to time determine and directors and
associate directors may be employed by the Company for such special services as
the Board of Directors may from time to time determine and shall be paid for
such special services so performed reasonable compensation as may be determined
by the Board of Directors.
ARTICLE X
Indemnification
Section 1. (A) The Corporation shall indemnify and hold harmless, to the
fullest extent permitted by applicable law as it presently exists or may
hereafter be amended, any person who was or is made or is threatened to be made
a party or is otherwise involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a "proceeding") by reason of
the fact that he, or a person for whom he is the legal representative, 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, fiduciary or
agent of another corporation or of a partnership, joint venture, trust,
enterprise or non-profit entity, including service with respect to employee
benefit plans, against all liability and loss suffered and expenses reasonably
incurred by such person. The Corporation shall indemnify a person in connection
with a proceeding initiated by such person only if the proceeding was authorized
by the Board of Directors of the Corporation.
(B) The Corporation shall pay the expenses incurred in
defending any proceeding in advance of its final disposition, provided, however,
that the payment of expenses incurred by a Director officer in his capacity as a
Director or officer in advance of the final disposition of the proceeding shall
be made only upon receipt of an undertaking by the Director or officer to repay
all amounts advanced if it should be ultimately determined that the Director or
officer is not entitled to be indemnified under this Article or otherwise.
(C) If a claim for indemnification or payment of expenses,
under this Article X is not paid in full within ninety days after a written
claim therefor has been received by the Corporation the claimant may file suit
to recover the unpaid amount of such claim and, if successful in whole or in
part, shall be entitled to be paid the expense of prosecuting such claim. In any
such action the Corporation shall have the burden of proving that the claimant
was not entitled to the requested indemnification of payment of expenses
9
<PAGE>
under applicable law.
(D) The rights conferred on any person by this Article X
shall not be exclusive of any other rights which such person may have or
hereafter acquire under any statute, provision of the Charter or Act of
Incorporation, these By-Laws, agreement, vote of stockholders or disinterested
Directors or otherwise.
(E) Any repeal or modification of the foregoing provisions of
this Article X shall not adversely affect any right or protection hereunder of
any person in respect of any act or omission occurring prior to the time of such
repeal or modification.
ARTICLE XI
Amendments to the By-Laws
Section 1. These By-Laws may be altered, amended or repealed, in whole or
in part, and any new By-Law or By-Laws adopted at any regular or special meeting
of the Board of Directors by a vote of the majority of all the members of the
Board of Directors then in office.
10
<PAGE>
EXHIBIT C
Section 321(b) Consent
Pursuant to Section 321(b) of the Trust Indenture Act of 1939, as amended,
Wilmington Trust Company hereby consents that reports of examinations by
Federal, State, Territorial or District authorities may be furnished by such
authorities to the Securities and Exchange Commission upon requests therefor.
WILMINGTON TRUST COMPANY
Dated: May 29, 1997 By: /s/ Norma P. Closs
---------------------
Name: Norma P. Closs
Title: Vice President
<PAGE>
EXHIBIT D
NOTICE
This form is intended to assist state nonmember banks and savings
banks with state publication requirements. It has not been approved
by any state banking authorities. Refer to your appropriate state
banking authorities for your state publication requirements.
R E P O R T O F C O N D I T I O N
Consolidating domestic subsidiaries of the
WILMINGTON TRUST COMPANY of WILMINGTON
- -------------------------------------------- -------------------
Name of Bank City
in the State of DELAWARE, at the close of business on March 31, 1997.
<TABLE>
<S> <C>
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins............... 181,744
Interest-bearing balances......................................... 0
Held-to-maturity securities............................................. 445,954
Available-for-sale securities........................................... 767,337
Federal funds sold and securities purchased under agreements to resell.. 86,900
Loans and lease financing receivables:
Loans and leases, net of unearned income................ 3,685,616
LESS: Allowance for loan and lease losses.............. 52,478
LESS: Allocated transfer risk reserve.................. 0
Loans and leases, net of unearned income, allowance, and reserve.. 3,633,138
Assets held in trading accounts......................................... 0
Premises and fixed assets (including capitalized leases)................ 94,513
Other real estate owned................................................. 3,702
Investments in unconsolidated subsidiaries and associated companies..... 20
Customers' liability to this bank on acceptances outstanding............ 0
Intangible assets....................................................... 4,012
Other assets............................................................ 103,524
Total assets............................................................ 5,320,844
</TABLE>
CONTINUED ON NEXT PAGE
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits:
In domestic offices......................................................... 3,618,174
Noninterest-bearing.......................................... 784,267
Interest-bearing.............................................2,833,907
Federal funds purchased and Securities sold under agreements to repurchase.. 293,862
Demand notes issued to the U.S. Treasury.................................... 64,550
Trading liabilities (from Schedule RC-D).................................... 0
Other borrowed money:
With original maturity of one year or less............................ 774,000
With original maturity of more than one year.......................... 43,000
Bank's liability on acceptances executed and outstanding.................... 0
Subordinated notes and debentures........................................... 0
Other liabilities (from Schedule RC-G)...................................... 95,672
Total liabilities........................................................... 4,889,258
EQUITY CAPITAL
Perpetual preferred stock and related surplus............................... 0
Common Stock................................................................ 500
Surplus (exclude all surplus related to preferred stock).................... 62,118
Undivided profits and capital reserves...................................... 371,107
Net unrealized holding gains (losses) on available-for-sale securities...... (2,139)
Total equity capital........................................................ 431,586
Total liabilities, limited-life preferred stock, and equity capital......... 5,320,844
Thousands of dollars
</TABLE>
2
<PAGE>
EXHIBIT 25(e)
Registration No. 33-80497
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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) ___
WILMINGTON TRUST COMPANY
(Exact name of trustee as specified in its charter)
Delaware 51-0055023
(State of incorporation) (I.R.S. employer identification no.)
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
(Address of principal executive offices)
Cynthia L. Corliss
Vice President and Trust Counsel
Wilmington Trust Company
Rodney Square North
Wilmington, Delaware 19890
(302) 651-8516
(Name, address and telephone number of agent for service)
RELIASTAR FINANCIAL CORP.
(Exact name of obligor as specified in its charter)
Delaware 41-1620373
(State of incorporation) (I.R.S. employer identification no.)
20 Washington Avenue South
Minneapolis, Minnesota 55401
(Address of principal executive offices) (Zip Code)
Guarantee of Trust Originated Preferred Securities of
ReliaStar Financing II by ReliaStar Financial Corp.
(Title of the indenture securities)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1
<PAGE>
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.
Federal Deposit Insurance Co. State Bank Commissioner
Five Penn Center Dover, Delaware
Suite #2901
Philadelphia, PA
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
If the obligor is an affiliate of the trustee, describe each
affiliation:
Based upon an examination of the books and records of the trustee
and upon information furnished by the obligor, the obligor is not an
affiliate of the trustee.
ITEM 3. LIST OF EXHIBITS.
List below all exhibits filed as part of this Statement of
Eligibility and Qualification.
A. Copy of the Charter of Wilmington Trust Company, which includes
the certificate of authority of Wilmington Trust Company to
commence business and the authorization of Wilmington Trust
Company to exercise corporate trust powers.
B. Copy of By-Laws of Wilmington Trust Company.
C. Consent of Wilmington Trust Company required by Section 321(b) of
Trust Indenture Act.
D. Copy of most recent Report of Condition of Wilmington Trust
Company.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Wilmington Trust Company, a corporation organized and
existing under the laws of Delaware, has duly caused this Statement of
Eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in the City of Wilmington and State of Delaware on the 29th day
of May, 1997.
WILMINGTON TRUST COMPANY
[SEAL]
Attest: /s/ Debra Eberly By:/s/ Norma P. Closs
--------------------------- ----------------------
Assistant Secretary Name: Norma P. Closs
Title: Vice President
2
<PAGE>
EXHIBIT A
AMENDED CHARTER
Wilmington Trust Company
Wilmington, Delaware
As existing on May 9, 1987
<PAGE>
Amended Charter
or
Act of Incorporation
of
Wilmington Trust Company
Wilmington Trust Company, originally incorporated by an Act of the General
Assembly of the State of Delaware, entitled "An Act to Incorporate the Delaware
Guarantee and Trust Company", approved March 2, A.D. 1901, and the name of which
company was changed to "Wilmington Trust Company" by an amendment filed in the
Office of the Secretary of State on March 18, A.D. 1903, and the Charter or Act
of Incorporation of which company has been from time to time amended and changed
by merger agreements pursuant to the corporation law for state banks and trust
companies of the State of Delaware, does hereby alter and amend its Charter or
Act of Incorporation so that the same as so altered and amended shall in its
entirety read as follows:
First: - The name of this corporation is Wilmington Trust Company.
Second: - The location of its principal office in the State of Delaware is
at Rodney Square North, in the City of Wilmington, County of New Castle;
the name of its resident agent is Wilmington Trust Company whose address is
Rodney Square North, in said City. In addition to such principal office,
the said corporation maintains and operates branch offices in the City of
Newark, New Castle County, Delaware, the Town of Newport, New Castle
County, Delaware, at Claymont, New Castle County, Delaware, at Greenville,
New Castle County Delaware, and at Milford Cross Roads, New Castle County,
Delaware, and shall be empowered to open, maintain and operate branch
offices at Ninth and Shipley Streets, 418 Delaware Avenue, 2120 Market
Street, and 3605 Market Street, all in the City of Wilmington, New Castle
County, Delaware, and such other branch offices or places of business as
may be authorized from time to time by the agency or agencies of the
government of the State of Delaware empowered to confer such authority.
Third: - (a) The nature of the business and the objects and purposes
proposed to be transacted, promoted or carried on by this Corporation are
to do any or all of the things herein mentioned as fully and to the same
extent as natural persons might or could do and in any part of the world,
viz.:
(1) To sue and be sued, complain and defend in any Court of law or
equity and to make and use a common seal, and alter the seal at
pleasure, to hold, purchase, convey, mortgage or otherwise deal in
real and personal estate and property, and to appoint such officers
and agents as the business of the
<PAGE>
Corporation shall require, to make by-laws not inconsistent with the
Constitution or laws of the United States or of this State, to
discount bills, notes or other evidences of debt, to receive deposits
of money, or securities for money, to buy gold and silver bullion and
foreign coins, to buy and sell bills of exchange, and generally to
use, exercise and enjoy all the powers, rights, privileges and
franchises incident to a corporation which are proper or necessary
for the transaction of the business of the Corporation hereby
created.
(2) To insure titles to real and personal property, or any estate or
interests therein, and to guarantee the holder of such property, real
or personal, against any claim or claims, adverse to his interest
therein, and to prepare and give certificates of title for any lands
or premises in the State of Delaware, or elsewhere.
(3) To act as factor, agent, broker or attorney in the receipt,
collection, custody, investment and management of funds, and the
purchase, sale, management and disposal of property of all
descriptions, and to prepare and execute all papers which may be
necessary or proper in such business.
(4) To prepare and draw agreements, contracts, deeds, leases,
conveyances, mortgages, bonds and legal papers of every description,
and to carry on the business of conveyancing in all its branches.
(5) To receive upon deposit for safekeeping money, jewelry, plate,
deeds, bonds and any and all other personal property of every sort
and kind, from executors, administrators, guardians, public officers,
courts, receivers, assignees, trustees, and from all fiduciaries, and
from all other persons and individuals, and from all corporations
whether state, municipal, corporate or private, and to rent boxes,
safes, vaults and other receptacles for such property.
(6) To act as agent or otherwise for the purpose of registering,
issuing, certificating, countersigning, transferring or underwriting
the stock, bonds or other obligations of any corporation,
association, state or municipality, and may receive and manage any
sinking fund therefor on such terms as may be agreed upon between the
two parties, and in like manner may act as Treasurer of any
corporation or municipality.
(7) To act as Trustee under any deed of trust, mortgage, bond or
other instrument issued by any state, municipality, body politic,
corporation, association or person, either alone or in conjunction
with any other person or persons, corporation or corporations.
2
<PAGE>
(8) To guarantee the validity, performance or effect of any contract
or agreement, and the fidelity of persons holding places of
responsibility or trust; to become surety for any person, or persons,
for the faithful performance of any trust, office, duty, contract or
agreement, either by itself or in conjunction with any other person,
or persons, corporation, or corporations, or in like manner become
surety upon any bond, recognizance, obligation, judgment, suit,
order, or decree to be entered in any court of record within the
State of Delaware or elsewhere, or which may now or hereafter be
required by any law, judge, officer or court in the State of Delaware
or elsewhere.
(9) To act by any and every method of appointment as trustee,
trustee in bankruptcy, receiver, assignee, assignee in bankruptcy,
executor, administrator, guardian, bailee, or in any other trust
capacity in the receiving, holding, managing, and disposing of any
and all estates and property, real, personal or mixed, and to be
appointed as such trustee, trustee in bankruptcy, receiver, assignee,
assignee in bankruptcy, executor, administrator, guardian or bailee
by any persons, corporations, court, officer, or authority, in the
State of Delaware or elsewhere; and whenever this Corporation is so
appointed by any person, corporation, court, officer or authority
such trustee, trustee in bankruptcy, receiver, assignee, assignee in
bankruptcy, executor, administrator, guardian, bailee, or in any
other trust capacity, it shall not be required to give bond with
surety, but its capital stock shall be taken and held as security for
the performance of the duties devolving upon it by such appointment.
(10) And for its care, management and trouble, and the exercise of
any of its powers hereby given, or for the performance of any of the
duties which it may undertake or be called upon to perform, or for
the assumption of any responsibility the said Corporation may be
entitled to receive a proper compensation.
(11) To purchase, receive, hold and own bonds, mortgages, debentures,
shares of capital stock, and other securities, obligations, contracts
and evidences of indebtedness, of any private, public or municipal
corporation within and without the State of Delaware, or of the
Government of the United States, or of any state, territory, colony,
or possession thereof, or of any foreign government or country; to
receive, collect, receipt for, and dispose of interest, dividends and
income upon and from any of the bonds, mortgages, debentures, notes,
shares of capital stock, securities, obligations, contracts,
evidences of indebtedness and other property held and owned by it,
and to exercise in respect of all such bonds, mortgages, debentures,
notes, shares of capital stock, securities, obligations, contracts,
evidences of indebtedness and other property, any and all the rights,
powers and privileges of individual
3
<PAGE>
owners thereof, including the right to vote thereon; to invest and
deal in and with any of the moneys of the Corporation upon such
securities and in such manner as it may think fit and proper, and
from time to time to vary or realize such investments; to issue bonds
and secure the same by pledges or deeds of trust or mortgages of or
upon the whole or any part of the property held or owned by the
Corporation, and to sell and pledge such bonds, as and when the Board
of Directors shall determine, and in the promotion of its said
corporate business of investment and to the extent authorized by law,
to lease, purchase, hold, sell, assign, transfer, pledge, mortgage
and convey real and personal property of any name and nature and any
estate or interest therein.
(b) In furtherance of, and not in limitation, of the powers conferred by
the laws of the State of Delaware, it is hereby expressly provided that
the said Corporation shall also have the following powers:
(1) To do any or all of the things herein set forth, to the same
extent as natural persons might or could do, and in any part of the
world.
(2) To acquire the good will, rights, property and franchises and to
undertake the whole or any part of the assets and liabilities of any
person, firm, association or corporation, and to pay for the same in
cash, stock of this Corporation, bonds or otherwise; to hold or in
any manner to dispose of the whole or any part of the property so
purchased; to conduct in any lawful manner the whole or any part of
any business so acquired, and to exercise all the powers necessary or
convenient in and about the conduct and management of such business.
(3) To take, hold, own, deal in, mortgage or otherwise lien, and to
lease, sell, exchange, transfer, or in any manner whatever dispose of
property, real, personal or mixed, wherever situated.
(4) To enter into, make, perform and carry out contracts of every
kind with any person, firm, association or corporation, and, without
limit as to amount, to draw, make, accept, endorse, discount,
execute and issue promissory notes, drafts, bills of exchange,
warrants, bonds, debentures, and other negotiable or transferable
instruments.
(5) To have one or more offices, to carry on all or any of its
operations and businesses, without restriction to the same extent as
natural persons might or could do, to purchase or otherwise acquire,
to hold, own, to mortgage, sell, convey or otherwise dispose of, real
and personal property, of every class and description, in any State,
District, Territory or Colony of the United States, and in any
foreign country or place.
4
<PAGE>
(6) It is the intention that the objects, purposes and powers
specified and clauses contained in this paragraph shall (except where
otherwise expressed in said paragraph) be nowise limited or
restricted by reference to or inference from the terms of any other
clause of this or any other paragraph in this charter, but that the
objects, purposes and powers specified in each of the clauses of this
paragraph shall be regarded as independent objects, purposes and
powers.
Fourth: - (a) The total number of shares of all classes of stock which
the Corporation shall have authority to issue is forty-one million
(41,000,000) shares, consisting of:
(1) One million (1,000,000) shares of Preferred stock, par value
$10.00 per share (hereinafter referred to as "Preferred Stock"); and
(2) Forty million (40,000,000) shares of Common Stock, par value
$1.00 per share (hereinafter referred to as "Common Stock").
(b) Shares of Preferred Stock may be issued from time to time in one or
more series as may from time to time be determined by the Board of
Directors each of said series to be distinctly designated. All shares of
any one series of Preferred Stock shall be alike in every particular,
except that there may be different dates from which dividends, if any,
thereon shall be cumulative, if made cumulative. The voting powers and
the preferences and relative, participating, optional and other special
rights of each such series, and the qualifications, limitations or
restrictions thereof, if any, may differ from those of any and all other
series at any time outstanding; and, subject to the provisions of
subparagraph 1 of Paragraph (c) of this Article Fourth, the Board of
Directors of the Corporation is hereby expressly granted authority to fix
by resolution or resolutions adopted prior to the issuance of any shares
of a particular series of Preferred Stock, the voting powers and the
designations, preferences and relative, optional and other special rights,
and the qualifications, limitations and restrictions of such series,
including, but without limiting the generality of the foregoing, the
following:
(1) The distinctive designation of, and the number of shares of
Preferred Stock which shall constitute such series, which number may
be increased (except where otherwise provided by the Board of
Directors) or decreased (but not below the number of shares thereof
then outstanding) from time to time by like action of the Board of
Directors;
(2) The rate and times at which, and the terms and conditions on
which, dividends, if any, on Preferred Stock of such series shall be
paid, the extent of the preference or relation, if any, of such
dividends to the dividends payable on any other class or classes, or
series of the same or other class of
5
<PAGE>
stock and whether such dividends shall be cumulative or non-
cumulative;
(3) The right, if any, of the holders of Preferred Stock of such
series to convert the same into or exchange the same for, shares of
any other class or classes or of any series of the same or any other
class or classes of stock of the Corporation and the terms and
conditions of such conversion or exchange;
(4) Whether or not Preferred Stock of such series shall be subject
to redemption, and the redemption price or prices and the time or
times at which, and the terms and conditions on which, Preferred
Stock of such series may be redeemed.
(5) The rights, if any, of the holders of Preferred Stock of such
series upon the voluntary or involuntary liquidation, merger,
consolidation, distribution or sale of assets, dissolution or
winding-up, of the Corporation.
(6) The terms of the sinking fund or redemption or purchase account,
if any, to be provided for the Preferred Stock of such series; and
(7) The voting powers, if any, of the holders of such series of
Preferred Stock which may, without limiting the generality of the
foregoing include the right, voting as a series or by itself or
together with other series of Preferred Stock or all series of
Preferred Stock as a class, to elect one or more directors of the
Corporation if there shall have been a default in the payment of
dividends on any one or more series of Preferred Stock or under such
circumstances and on such conditions as the Board of Directors may
determine.
(c) (1) After the requirements with respect to preferential dividends on
the Preferred Stock (fixed in accordance with the provisions of section
(b) of this Article Fourth), if any, shall have been met and after the
Corporation shall have complied with all the requirements, if any, with
respect to the setting aside of sums as sinking funds or redemption or
purchase accounts (fixed in accordance with the provisions of section (b)
of this Article Fourth), and subject further to any conditions which may
be fixed in accordance with the provisions of section (b) of this Article
Fourth, then and not otherwise the holders of Common Stock shall be
entitled to receive such dividends as may be declared from time to time by
the Board of Directors.
(2) After distribution in full of the preferential amount, if any,
(fixed in accordance with the provisions of section (b) of this
Article Fourth), to be distributed to the holders of Preferred Stock
in the event of voluntary or involuntary liquidation, distribution or
sale of assets, dissolution or winding-up, of the Corporation, the
holders of the Common Stock shall be entitled to
6
<PAGE>
receive all of the remaining assets of the Corporation, tangible and
intangible, of whatever kind available for distribution to
stockholders ratably in proportion to the number of shares of Common
Stock held by them respectively.
(3) Except as may otherwise be required by law or by the provisions
of such resolution or resolutions as may be adopted by the Board of
Directors pursuant to section (b) of this Article Fourth, each holder
of Common Stock shall have one vote in respect of each share of
Common Stock held on all matters voted upon by the stockholders.
(d) No holder of any of the shares of any class or series of stock or of
options, warrants or other rights to purchase shares of any class or
series of stock or of other securities of the Corporation shall have any
preemptive right to purchase or subscribe for any unissued stock of any
class or series or any additional shares of any class or series to be
issued by reason of any increase of the authorized capital stock of the
Corporation of any class or series, or bonds, certificates of
indebtedness, debentures or other securities convertible into or
exchangeable for stock of the Corporation of any class or series, or
carrying any right to purchase stock of any class or series, but any such
unissued stock, additional authorized issue of shares of any class or
series of stock or securities convertible into or exchangeable for stock,
or carrying any right to purchase stock, may be issued and disposed of
pursuant to resolution of the Board of Directors to such persons, firms,
corporations or associations, whether such holders or others, and upon
such terms as may be deemed advisable by the Board of Directors in the
exercise of its sole discretion.
(e) The relative powers, preferences and rights of each series of
Preferred Stock in relation to the relative powers, preferences and rights
of each other series of Preferred Stock shall, in each case, be as fixed
from time to time by the Board of Directors in the resolution or
resolutions adopted pursuant to authority granted in section (b) of this
Article Fourth and the consent, by class or series vote or otherwise, of
the holders of such of the series of Preferred Stock as are from time to
time outstanding shall not be required for the issuance by the Board of
Directors of any other series of Preferred Stock whether or not the
powers, preferences and rights of such other series shall be fixed by the
Board of Directors as senior to, or on a parity with, the powers,
preferences and rights of such outstanding series, or any of them;
provided, however, that the Board of Directors may provide in the
resolution or resolutions as to any series of Preferred Stock adopted
pursuant to section (b) of this Article Fourth that the consent of the
holders of a majority (or such greater proportion as shall be therein
fixed) of the outstanding shares of such series voting thereon shall be
required for the issuance of any or all other series of Preferred Stock.
7
<PAGE>
(f) Subject to the provisions of section (e), shares of any series of
Preferred Stock may be issued from time to time as the Board of Directors
of the Corporation shall determine and on such terms and for such
consideration as shall be fixed by the Board of Directors.
(g) Shares of Common Stock may be issued from time to time as the Board
of Directors of the Corporation shall determine and on such terms and for
such consideration as shall be fixed by the Board of Directors.
(h) The authorized amount of shares of Common Stock and of Preferred
Stock may, without a class or series vote, be increased or decreased from
time to time by the affirmative vote of the holders of a majority of the
stock of the Corporation entitled to vote thereon.
Fifth: - (a) The business and affairs of the Corporation shall be
conducted and managed by a Board of Directors. The number of directors
constituting the entire Board shall be not less than five nor more than
twenty-five as fixed from time to time by vote of a majority of the whole
Board, provided, however, that the number of directors shall not be
reduced so as to shorten the term of any director at the time in office,
and provided further, that the number of directors constituting the whole
Board shall be twenty-four until otherwise fixed by a majority of the
whole Board.
(b) The Board of Directors shall be divided into three classes, as nearly
equal in number as the then total number of directors constituting the
whole Board permits, with the term of office of one class expiring each
year. At the annual meeting of stockholders in 1982, directors of the
first class shall be elected to hold office for a term expiring at the
next succeeding annual meeting, directors of the second class shall be
elected to hold office for a term expiring at the second succeeding annual
meeting and directors of the third class shall be elected to hold office
for a term expiring at the third succeeding annual meeting. Any vacancies
in the Board of Directors for any reason, and any newly created
directorships resulting from any increase in the directors, may be filled
by the Board of Directors, acting by a majority of the directors then in
office, although less than a quorum, and any directors so chosen shall
hold office until the next annual election of directors. At such
election, the stockholders shall elect a successor to such director to
hold office until the next election of the class for which such director
shall have been chosen and until his successor shall be elected and
qualified. No decrease in the number of directors shall shorten the term
of any incumbent director.
(c) Notwithstanding any other provisions of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and notwithstanding the
fact that some lesser percentage may be specified by law, this Charter or
Act of Incorporation or the By-Laws of the Corporation), any director or
the entire Board of Directors of the
8
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Corporation may be removed at any time without cause, but only by the
affirmative vote of the holders of two-thirds or more of the outstanding
shares of capital stock of the Corporation entitled to vote generally in
the election of directors (considered for this purpose as one class) cast
at a meeting of the stockholders called for that purpose.
(d) Nominations for the election of directors may be made by the Board of
Directors or by any stockholder entitled to vote for the election of
directors. Such nominations shall be made by notice in writing, delivered
or mailed by first class United States mail, postage prepaid, to the
Secretary of the Corporation not less than 14 days nor more than 50 days
prior to any meeting of the stockholders called for the election of
directors; provided, however, that if less than 21 days' notice of the
meeting is given to stockholders, such written notice shall be delivered
or mailed, as prescribed, to the Secretary of the Corporation not later
than the close of the seventh day following the day on which notice of the
meeting was mailed to stockholders. Notice of nominations which are
proposed by the Board of Directors shall be given by the Chairman on
behalf of the Board.
(e) Each notice under subsection (d) shall set forth (i) the name, age,
business address and, if known, residence address of each nominee proposed
in such notice, (ii) the principal occupation or employment of such
nominee and (iii) the number of shares of stock of the Corporation which
are beneficially owned by each such nominee.
(f) The Chairman of the meeting may, if the facts warrant, determine and
declare to the meeting that a nomination was not made in accordance with
the foregoing procedure, and if he should so determine, he shall so
declare to the meeting and the defective nomination shall be disregarded.
(g) No action required to be taken or which may be taken at any annual or
special meeting of stockholders of the Corporation may be taken without a
meeting, and the power of stockholders to consent in writing, without a
meeting, to the taking of any action is specifically denied.
Sixth: - The Directors shall choose such officers, agent and servants as
may be provided in the By-Laws as they may from time to time find
necessary or proper.
Seventh: - The Corporation hereby created is hereby given the same powers,
rights and privileges as may be conferred upon corporations organized
under the Act entitled "An Act Providing a General Corporation Law",
approved March 10, 1899, as from time to time amended.
Eighth: - This Act shall be deemed and taken to be a private Act.
9
<PAGE>
Ninth: - This Corporation is to have perpetual existence.
Tenth: - The Board of Directors, by resolution passed by a majority of the
whole Board, may designate any of their number to constitute an Executive
Committee, which Committee, to the extent provided in said resolution, or
in the By-Laws of the Company, shall have and may exercise all of the
powers of the Board of Directors in the management of the business and
affairs of the Corporation, and shall have power to authorize the seal of
the Corporation to be affixed to all papers which may require it.
Eleventh: - The private property of the stockholders shall not be liable
for the payment of corporate debts to any extent whatever.
Twelfth: - The Corporation may transact business in any part of the world.
Thirteenth: - The Board of Directors of the Corporation is expressly
authorized to make, alter or repeal the By-Laws of the Corporation by a
vote of the majority of the entire Board. The stockholders may make,
alter or repeal any By-Law whether or not adopted by them, provided
however, that any such additional By-Laws, alterations or repeal may be
adopted only by the affirmative vote of the holders of two-thirds or more
of the outstanding shares of capital stock of the Corporation entitled to
vote generally in the election of directors (considered for this purpose
as one class).
Fourteenth: - Meetings of the Directors may be held outside of the State
of Delaware at such places as may be from time to time designated by the
Board, and the Directors may keep the books of the Company outside of the
State of Delaware at such places as may be from time to time designated by
them.
Fifteenth: - (a) In addition to any affirmative vote required by law, and
except as otherwise expressly provided in sections (b) and (c) of this
Article Fifteenth:
(A) any merger or consolidation of the Corporation or any Subsidiary
(as hereinafter defined) with or into (i) any Interested Stockholder
(as hereinafter defined) or (ii) any other corporation (whether or
not itself an Interested Stockholder), which, after such merger or
consolidation, would be an Affiliate (as hereinafter defined) of an
Interested Stockholder, or
(B) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of related transactions)
to or with any Interested Stockholder or any Affiliate of any
Interested Stockholder of any assets of the Corporation or any
Subsidiary having an aggregate fair market value of $1,000,000 or
more, or
10
<PAGE>
(C) the issuance or transfer by the Corporation or any Subsidiary
(in one transaction or a series of related transactions) of any
securities of the Corporation or any Subsidiary to any Interested
Stockholder or any Affiliate of any Interested Stockholder in
exchange for cash, securities or other property (or a combination
thereof) having an aggregate fair market value of $1,000,000 or more,
or
(D) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation, or
(E) any reclassification of securities (including any reverse stock
split), or recapitalization of the Corporation, or any merger or
consolidation of the Corporation with any of its Subsidiaries or any
similar transaction (whether or not with or into or otherwise
involving an Interested Stockholder) which has the effect, directly
or indirectly, of increasing the proportionate share of the
outstanding shares of any class of equity or convertible securities
of the Corporation or any Subsidiary which is directly or indirectly
owned by any Interested Stockholder, or any Affiliate of any
Interested Stockholder,
shall require the affirmative vote of the holders of at least two-thirds of the
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, considered for the purpose of this
Article Fifteenth as one class ("Voting Shares"). Such affirmative vote shall
be required notwithstanding the fact that no vote may be required, or that some
lesser percentage may be specified, by law or in any agreement with any national
securities exchange or otherwise.
(2) The term "business combination" as used in this Article
Fifteenth shall mean any transaction which is referred to any one or
more of clauses (A) through (E) of paragraph 1 of the section (a).
(b) The provisions of section (a) of this Article Fifteenth shall
not be applicable to any particular business combination and such
business combination shall require only such affirmative vote as is
required by law and any other provisions of the Charter or Act of
Incorporation of By-Laws if such business combination has been
approved by a majority of the whole Board.
(c) For the purposes of this Article Fifteenth:
(1) A "person" shall mean any individual firm, corporation or other
entity.
(2) "Interested Stockholder" shall mean, in respect of any business
combination, any person (other than the Corporation or any Subsidiary) who
or which as of the record date for the determination of stockholders
entitled to notice of and to vote on
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such business combination, or immediately prior to the consummation of any
such transaction:
(A) is the beneficial owner, directly or indirectly, of more than
10% of the Voting Shares, or
(B) is an Affiliate of the Corporation and at any time within two
years prior thereto was the beneficial owner, directly or indirectly,
of not less than 10% of the then outstanding voting Shares, or
(C) is an assignee of or has otherwise succeeded in any share of
capital stock of the Corporation which were at any time within two
years prior thereto beneficially owned by any Interested Stockholder,
and such assignment or succession shall have occurred in the course
of a transaction or series of transactions not involving a public
offering within the meaning of the Securities Act of 1933.
(3) A person shall be the "beneficial owner" of any Voting Shares:
(A) which such person or any of its Affiliates and Associates (as
hereafter defined) beneficially own, directly or indirectly, or
(B) which such person or any of its Affiliates or Associates has (i)
the right to acquire (whether such right is exercisable immediately
or only after the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion
rights, exchange rights, warrants or options, or otherwise, or (ii)
the right to vote pursuant to any agreement, arrangement or
understanding, or
(C) which are beneficially owned, directly or indirectly, by any
other person with which such first mentioned person or any of its
Affiliates or Associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or
disposing of any shares of capital stock of the Corporation.
(4) The outstanding Voting Shares shall include shares deemed owned
through application of paragraph (3) above but shall not include any other
Voting Shares which may be issuable pursuant to any agreement, or upon
exercise of conversion rights, warrants or options or otherwise.
(5) "Affiliate" and "Associate" shall have the respective meanings given
those terms in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as in effect on December 31, 1981.
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(6) "Subsidiary" shall mean any corporation of which a majority of any
class of equity security (as defined in Rule 3a11-1 of the General Rules
and Regulations under the Securities Exchange Act of 1934, as in effect in
December 31, 1981) is owned, directly or indirectly, by the Corporation;
provided, however, that for the purposes of the definition of Investment
Stockholder set forth in paragraph (2) of this section (c), the term
"Subsidiary" shall mean only a corporation of which a majority of each
class of equity security is owned, directly or indirectly, by the
Corporation.
(d) majority of the directors shall have the power and duty to
determine for the purposes of this Article Fifteenth on the basis of
information known to them, (1) the number of Voting Shares
beneficially owned by any person (2) whether a person is an Affiliate
or Associate of another, (3) whether a person has an agreement,
arrangement or understanding with another as to the matters referred
to in paragraph (3) of section (c), or (4) whether the assets subject
to any business combination or the consideration received for the
issuance or transfer of securities by the Corporation, or any
Subsidiary has an aggregate fair market value of $1,000,000 or more.
(e) Nothing contained in this Article Fifteenth shall be construed
to relieve any Interested Stockholder from any fiduciary obligation
imposed by law.
Sixteenth: Notwithstanding any other provision of this Charter or Act of
Incorporation or the By-Laws of the Corporation (and in addition to any
other vote that may be required by law, this Charter or Act of
Incorporation by the By-Laws), the affirmative vote of the holders of at
least two-thirds of the outstanding shares of the capital stock of the
Corporation entitled to vote generally in the election of directors
(considered for this purpose as one class) shall be required to amend,
alter or repeal any provision of Articles Fifth, Thirteenth, Fifteenth or
Sixteenth of this Charter or Act of Incorporation.
Seventeenth: (a) a Director of this Corporation shall not be liable to
the Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a Director, except to the extent such exemption from
liability or limitation thereof is not permitted under the Delaware
General Corporation Laws as the same exists or may hereafter be amended.
(b) Any repeal or modification of the foregoing paragraph shall not
adversely affect any right or protection of a Director of the
Corporation existing hereunder with respect to any act or omission
occurring prior to the time of such repeal or modification."
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EXHIBIT B
BY-LAWS
WILMINGTON TRUST COMPANY
WILMINGTON, DELAWARE
As existing on January 16, 1997
<PAGE>
BY-LAWS OF WILMINGTON TRUST COMPANY
ARTICLE I
Stockholders' Meetings
Section 1. The Annual Meeting of Stockholders shall be held on the third
Thursday in April each year at the principal office at the Company or at such
other date, time, or place as may be designated by resolution by the Board of
Directors.
Section 2. Special meetings of all stockholders may be called at any time
by the Board of Directors, the Chairman of the Board or the President.
Section 3. Notice of all meetings of the stockholders shall be given by
mailing to each stockholder at least ten (10) days before said meeting, at his
last known address, a written or printed notice fixing the time and place of
such meeting.
Section 4. A majority in the amount of the capital stock of the Company
issued and outstanding on the record date, as herein determined, shall
constitute a quorum at all meetings of stockholders for the transaction of any
business, but the holders of a small number of shares may adjourn, from time to
time, without further notice, until a quorum is secured. At each annual or
special meeting of stockholders, each stockholder shall be entitled to one vote,
either in person or by proxy, for each shares of stock registered in the
stockholder's name on the books of the Company on the record date for any such
meeting as determined herein.
ARTICLE II
Directors
Section 1. The number and classification of the Board of Directors shall
be as set forth in the Charter of the Bank.
Section 2. No person who has attained the age of seventy-two (72) years
shall be nominated for election to the Board of Directors of the Company,
provided, however, that this limitation shall not apply to any person who was
serving as director of the Company on September 16, 1971.
Section 3. The class of Directors so elected shall hold office for three
years or until their successors are elected and qualified.
Section 4. The affairs and business of the Company shall be managed and
conducted by the Board of Directors.
Section 5. The Board of Directors shall meet at the principal office of
the Company or elsewhere in its discretion at such times to be determined by a
majority of its
<PAGE>
members, or at the call of the Chairman of the Board of Directors or the
President.
Section 6. Special meetings of the Board of Directors may be called at
any time by the Chairman of the Board of Directors or by the President, and
shall be called upon the written request of a majority of the directors.
Section 7. A majority of the directors elected and qualified shall be
necessary to constitute a quorum for the transaction of business at any meeting
of the Board of Directors.
Section 8. Written notice shall be sent by mail to each director of any
special meeting of the Board of Directors, and of any change in the time or
place of any regular meeting, stating the time and place of such meeting, which
shall be mailed not less than two days before the time of holding such meeting.
Section 9. In the event of the death, resignation, removal, inability to
act, or disqualification of any director, the Board of Directors, although less
than a quorum, shall have the right to elect the successor who shall hold office
for the remainder of the full term of the class of directors in which the
vacancy occurred, and until such director's successor shall have been duly
elected and qualified.
Section 10. The Board of Directors at its first meeting after its
election by the stockholders shall appoint an Executive Committee, a Trust
Committee, an Audit Committee and a Compensation Committee, and shall elect from
its own members a Chairman of the Board of Directors and a President who may be
the same person. The Board of Directors shall also elect at such meeting a
Secretary and a Treasurer, who may be the same person, may appoint at any time
such other committees and elect or appoint such other officers as it may deem
advisable. The Board of Directors may also elect at such meeting one or more
Associate Directors.
Section 11. The Board of Directors may at any time remove, with or
without cause, any member of any Committee appointed by it or any associate
director or officer elected by it and may appoint or elect his successor.
Section 12. The Board of Directors may designate an officer to be in
charge of such of the departments or division of the Company as it may deem
advisable.
ARTICLE III
Committees
Section I. Executive Committee
(A) The Executive Committee shall be composed of not more than nine
members who shall be selected by the Board of Directors from its own members and
who
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shall hold office during the pleasure of the Board.
(B) The Executive Committee shall have all the powers of the Board of
Directors when it is not in session to transact all business for and in behalf
of the Company that may be brought before it.
(C) The Executive Committee shall meet at the principal office of the
Company or elsewhere in its discretion at such times to be determined by a
majority of its members, or at the call of the Chairman of the Executive
Committee or at the call of the Chairman of the Board of Directors. The
majority of its members shall be necessary to constitute a quorum for the
transaction of business. Special meetings of the Executive Committee may be
held at any time when a quorum is present.
(D) Minutes of each meeting of the Executive Committee shall be kept
and submitted to the Board of Directors at its next meeting.
(E) The Executive Committee shall advise and superintend all
investments that may be made of the funds of the Company, and shall direct the
disposal of the same, in accordance with such rules and regulations as the Board
of Directors from time to time make.
(F) In the event of a state of disaster of sufficient severity to
prevent the conduct and management of the affairs and business of the Company by
its directors and officers as contemplated by these By-Laws any two available
members of the Executive Committee as constituted immediately prior to such
disaster shall constitute a quorum of that Committee for the full conduct and
management of the affairs and business of the Company in accordance with the
provisions of Article III of these By-Laws; and if less than three members of
the Trust Committee is constituted immediately prior to such disaster shall be
available for the transaction of its business, such Executive Committee shall
also be empowered to exercise all of the powers reserved to the Trust Committee
under Article III Section 2 hereof. In the event of the unavailability, at such
time, of a minimum of two members of such Executive Committee, any three
available directors shall constitute the Executive Committee for the full
conduct and management of the affairs and business of the Company in accordance
with the foregoing provisions of this Section. This By-Law shall be subject to
implementation by Resolutions of the Board of Directors presently existing or
hereafter passed from time to time for that purpose, and any provisions of these
By-Laws (other than this Section) and any resolutions which are contrary to the
provisions of this Section or to the provisions of any such implementary
Resolutions shall be suspended during such a disaster period until it shall be
determined by any interim Executive Committee acting under this section that it
shall be to the advantage of the Company to resume the conduct and management of
its affairs and business under all of the other provisions of these By-Laws.
3
<PAGE>
Section 2. Trust Committee
(A) The Trust Committee shall be composed of not more than
thirteen members who shall be selected by the Board of Directors, a majority of
whom shall be members of the Board of Directors and who shall hold office during
the pleasure of the Board.
(B) The Trust Committee shall have general supervision over
the Trust Department and the investment of trust funds, in all matters, however,
being subject to the approval of the Board of Directors.
(C) The Trust Committee shall meet at the principal office of
the Company or elsewhere in its discretion at such times to be determined by a
majority of its members or at the call of its chairman. A majority of its
members shall be necessary to constitute a quorum for the transaction of
business.
(D) Minutes of each meeting of the Trust Committee shall be
kept and promptly submitted to the Board of Directors.
(E) The Trust Committee shall have the power to appoint
Committees and/or designate officers or employees of the Company to whom
supervision over the investment of trust funds may be delegated when the Trust
Committee is not in session.
Section 3. Audit Committee
(A) The Audit Committee shall be composed of five members who
shall be selected by the Board of Directors from its own members, none of whom
shall be an officer of the Company, and shall hold office at the pleasure of the
Board.
(B) The Audit Committee shall have general supervision over
the Audit Division in all matters however subject to the approval of the Board
of Directors; it shall consider all matters brought to its attention by the
officer in charge of the Audit Division, review all reports of examination of
the Company made by any governmental agency or such independent auditor employed
for that purpose, and make such recommendations to the Board of Directors with
respect thereto or with respect to any other matters pertaining to auditing the
Company as it shall deem desirable.
(C) The Audit Committee shall meet whenever and wherever the
majority of its members shall deem it to be proper for the transaction of its
business, and a majority of its Committee shall constitute a quorum.
Section 4. Compensation Committee
(A) The Compensation Committee shall be composed of not more
than
4
<PAGE>
five (5) members who shall be selected by the Board of Directors from its own
members who are not officers of the Company and who shall hold office during the
pleasure of the Board.
(B) The Compensation Committee shall in general advise upon
all matters of policy concerning the Company brought to its attention by the
management and from time to time review the management of the Company, major
organizational matters, including salaries and employee benefits and
specifically shall administer the Executive Incentive Compensation Plan.
(C) Meetings of the Compensation Committee may be called at
any time by the Chairman of the Compensation Committee, the Chairman of the
Board of Directors, or the President of the Company.
Section 5. Associate Directors
(A) Any person who has served as a director may be elected by
the Board of Directors as an associate director, to serve during the pleasure of
the Board.
(B) An associate director shall be entitled to attend all
directors meetings and participate in the discussion of all matters brought to
the Board, with the exception that he would have no right to vote. An associate
director will be eligible for appointment to Committees of the Company, with the
exception of the Executive Committee, Audit Committee and Compensation
Committee, which must be comprised solely of active directors.
Section 6. Absence or Disqualification of Any Member of a Committee
(A) In the absence or disqualification of any member of any
Committee created under Article III of the By-Laws of this Company, the member
or members thereof present at any meeting and not disqualified from voting,
whether or not he or they constitute a quorum, may unanimously appoint another
member of the Board of Directors to act at the meeting in the place of any such
absence or disqualified member.
ARTICLE IV
Officers
Section 1. The Chairman of the Board of Directors shall preside at all
meetings of the Board and shall have such further authority and powers and shall
perform such duties as the Board of Directors may from time to time confer and
direct. He shall also exercise such powers and perform such duties as may from
time to time be agreed upon between himself and the President of the Company.
Section 2. The Vice Chairman of the Board. The Vice Chairman of the Board
of
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<PAGE>
Directors shall preside at all meetings of the Board of Directors at which the
Chairman of the Board shall not be present and shall have such further authority
and powers and shall perform such duties as the Board of Directors or the
Chairman of the Board may from time to time confer and direct.
Section 3. The President shall have the powers and duties pertaining to
the office of the President conferred or imposed upon him by statute or assigned
to him by the Board of Directors in the absence of the Chairman of the Board the
President shall have the powers and duties of the Chairman of the Board.
Section 4. The Chairman of the Board of Directors or the President as
designated by the Board of Directors, shall carry into effect all legal
directions of the Executive Committee and of the Board of Directors, and shall
at all times exercise general supervision over the interest, affairs and
operations of the Company and perform all duties incident to his office.
Section 5. There may be one or more Vice Presidents, however denominated
by the Board of Directors, who may at any time perform all the duties of the
Chairman of the Board of Directors and/or the President and such other powers
and duties as may from time to time be assigned to them by the Board of
Directors, the Executive Committee, the Chairman of the Board or the President
and by the officer in charge of the department or division to which they are
assigned.
Section 6. The Secretary shall attend to the giving of notice of meetings
of the stockholders and the Board of Directors, as well as the Committees
thereof, to the keeping of accurate minutes of all such meetings and to
recording the same in the minute books of the Company. In addition to the other
notice requirements of these By-Laws and as may be practicable under the
circumstances, all such notices shall be in writing and mailed well in advance
of the scheduled date of any other meeting. He shall have custody of the
corporate seal and shall affix the same to any documents requiring such
corporate seal and to attest the same.
Section 7. The Treasurer shall have general supervision over all assets
and liabilities of the Company. He shall be custodian of and responsible for
all monies, funds and valuables of the Company and for the keeping of proper
records of the evidence of property or indebtedness and of all the transactions
of the Company. He shall have general supervision of the expenditures of the
Company and shall report to the Board of Directors at each regular meeting of
the condition of the Company, and perform such other duties as may be assigned
to him from time to time by the Board of Directors of the Executive Committee.
Section 8. There may be a Controller who shall exercise general
supervision over the internal operations of the Company, including accounting,
and shall render to the Board of Directors at appropriate times a report
relating to the general condition and internal operations of the Company.
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There may be one or more subordinate accounting or controller officers
however denominated, who may perform the duties of the Controller and such
duties as may be prescribed by the Controller.
Section 9. The officer designated by the Board of Directors to be in
charge of the Audit Division of the Company with such title as the Board of
Directors shall prescribe, shall report to and be directly responsible only to
the Board of Directors.
There shall be an Auditor and there may be one or more Audit Officers,
however denominated, who may perform all the duties of the Auditor and such
duties as may be prescribed by the officer in charge of the Audit Division.
Section 10. There may be one or more officers, subordinate in rank to all
Vice Presidents with such functional titles as shall be determined from time to
time by the Board of Directors, who shall ex officio hold the office Assistant
Secretary of this Company and who may perform such duties as may be prescribed
by the officer in charge of the department or division to whom they are
assigned.
Section 11. The powers and duties of all other officers of the Company
shall be those usually pertaining to their respective offices, subject to the
direction of the Board of Directors, the Executive Committee, Chairman of the
Board of Directors or the President and the officer in charge of the department
or division to which they are assigned.
ARTICLE V
Stock and Stock Certificates
Section 1. Shares of stock shall be transferrable on the books of the
Company and a transfer book shall be kept in which all transfers of stock shall
be recorded.
Section 2. Certificate of stock shall bear the signature of the President
or any Vice President, however denominated by the Board of Directors and
countersigned by the Secretary or Treasurer or an Assistant Secretary, and the
seal of the corporation shall be engraved thereon. Each certificate shall
recite that the stock represented thereby is transferrable only upon the books
of the Company by the holder thereof or his attorney, upon surrender of the
certificate properly endorsed. Any certificate of stock surrendered to the
Company shall be cancelled at the time of transfer, and before a new certificate
or certificates shall be issued in lieu thereof. Duplicate certificates of
stock shall be issued only upon giving such security as may be satisfactory to
the Board of Directors or the Executive Committee.
Section 3. The Board of Directors of the Company is authorized to fix in
advance a record date for the determination of the stockholders entitled to
notice of, and to vote at, any meeting of stockholders and any adjournment
thereof, or entitled to receive payment of
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<PAGE>
any dividend, or to any allotment or rights, or to exercise any rights in
respect of any change, conversion or exchange of capital stock, or in connection
with obtaining the consent of stockholders for any purpose, which record date
shall not be more than 60 nor less than 10 days proceeding the date of any
meeting of stockholders or the date for the payment of any dividend, or the date
for the allotment of rights, or the date when any change or conversion or
exchange of capital stock shall go into effect, or a date in connection with
obtaining such consent.
ARTICLE VI
Seal
Section 1. The corporate seal of the Company shall be in the following
form:
Between two concentric circles the words
"Wilmington Trust Company" within the inner
circle the words "Wilmington, Delaware."
ARTICLE VII
Fiscal Year
Section 1. The fiscal year of the Company shall be the calendar year.
ARTICLE VIII
Execution of Instruments of the Company
Section 1. The Chairman of the Board, the President or any Vice President,
however denominated by the Board of Directors, shall have full power and
authority to enter into, make, sign, execute, acknowledge and/or deliver and the
Secretary or any Assistant Secretary shall have full power and authority to
attest and affix the corporate seal of the Company to any and all deeds,
conveyances, assignments, releases, contracts, agreements, bonds, notes,
mortgages and all other instruments incident to the business of this Company or
in acting as executor, administrator, guardian, trustee, agent or in any other
fiduciary or representative capacity by any and every method of appointment or
by whatever person, corporation, court officer or authority in the State of
Delaware, or elsewhere, without any specific authority, ratification, approval
or confirmation by the Board of Directors or the Executive Committee, and any
and all such instruments shall have the same force and validity as though
expressly authorized by the Board of Directors and/or the Executive Committee.
8
<PAGE>
ARTICLE IX
Compensation of Directors and Members of Committees
Section 1. Directors and associate directors of the Company, other than
salaried officers of the Company, shall be paid such reasonable honoraria or
fees for attending meetings of the Board of Directors as the Board of Directors
may from time to time determine. Directors and associate directors who serve as
members of committees, other than salaried employees of the Company, shall be
paid such reasonable honoraria or fees for services as members of committees as
the Board of Directors shall from time to time determine and directors and
associate directors may be employed by the Company for such special services as
the Board of Directors may from time to time determine and shall be paid for
such special services so performed reasonable compensation as may be determined
by the Board of Directors.
ARTICLE X
Indemnification
Section 1. (A) The Corporation shall indemnify and hold harmless, to the
fullest extent permitted by applicable law as it presently exists or may
hereafter be amended, any person who was or is made or is threatened to be made
a party or is otherwise involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigative (a "proceeding") by reason of
the fact that he, or a person for whom he is the legal representative, 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, fiduciary or
agent of another corporation or of a partnership, joint venture, trust,
enterprise or non-profit entity, including service with respect to employee
benefit plans, against all liability and loss suffered and expenses reasonably
incurred by such person. The Corporation shall indemnify a person in connection
with a proceeding initiated by such person only if the proceeding was authorized
by the Board of Directors of the Corporation.
(B) The Corporation shall pay the expenses incurred in
defending any proceeding in advance of its final disposition, provided, however,
that the payment of expenses incurred by a Director officer in his capacity as a
Director or officer in advance of the final disposition of the proceeding shall
be made only upon receipt of an undertaking by the Director or officer to repay
all amounts advanced if it should be ultimately determined that the Director or
officer is not entitled to be indemnified under this Article or otherwise.
(C) If a claim for indemnification or payment of expenses,
under this Article X is not paid in full within ninety days after a written
claim therefor has been received by the Corporation the claimant may file suit
to recover the unpaid amount of such claim and, if successful in whole or in
part, shall be entitled to be paid the expense of prosecuting such claim. In any
such action the Corporation shall have the burden of proving that the claimant
was not entitled to the requested indemnification of payment of expenses
9
<PAGE>
under applicable law.
(D) The rights conferred on any person by this Article X shall
not be exclusive of any other rights which such person may have or hereafter
acquire under any statute, provision of the Charter or Act of Incorporation,
these By-Laws, agreement, vote of stockholders or disinterested Directors or
otherwise.
(E) Any repeal or modification of the foregoing provisions of
this Article X shall not adversely affect any right or protection hereunder of
any person in respect of any act or omission occurring prior to the time of such
repeal or modification.
ARTICLE XI
Amendments to the By-Laws
Section 1. These By-Laws may be altered, amended or repealed, in whole or
in part, and any new By-Law or By-Laws adopted at any regular or special meeting
of the Board of Directors by a vote of the majority of all the members of the
Board of Directors then in office.
10
<PAGE>
EXHIBIT C
Section 321(b) Consent
Pursuant to Section 321(b) of the Trust Indenture Act of 1939, as amended,
Wilmington Trust Company hereby consents that reports of examinations by
Federal, State, Territorial or District authorities may be furnished by such
authorities to the Securities and Exchange Commission upon requests therefor.
WILMINGTON TRUST COMPANY
Dated: May 29, 1997 By: /s/ Norma P. Closs
--------------------
Name: Norma P. Closs
Title: Vice President
<PAGE>
EXHIBIT D
NOTICE
This form is intended to assist state nonmember banks and savings
banks with state publication requirements. It has not been approved
by any state banking authorities. Refer to your appropriate state
banking authorities for your state publication requirements.
R E P O R T O F C O N D I T I O N
Consolidating domestic subsidiaries of the
WILMINGTON TRUST COMPANY of WILMINGTON
- --------------------------------------- ---------------------------------
Name of Bank City
in the State of DELAWARE, at the close of business on March 31, 1997.
--------
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins............... 181,744
Interest-bearing balances......................................... 0
Held-to-maturity securities............................................. 445,954
Available-for-sale securities........................................... 767,337
Federal funds sold and securities purchased under agreements to resell.. 86,900
Loans and lease financing receivables:
Loans and leases, net of unearned income..........3,685,616
LESS: Allowance for loan and lease losses...........52,478
LESS: Allocated transfer risk reserve....................0
Loans and leases, net of unearned income, allowance, and reserve.. 3,633,138
Assets held in trading accounts......................................... 0
Premises and fixed assets (including capitalized leases)................ 94,513
Other real estate owned................................................. 3,702
Investments in unconsolidated subsidiaries and associated companies..... 20
Customers' liability to this bank on acceptances outstanding............ 0
Intangible assets....................................................... 4,012
Other assets............................................................ 103,524
Total assets............................................................ 5,320,844
</TABLE>
CONTINUED ON NEXT PAGE
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits:
In domestic offices......................................................... 3,618,174
Noninterest-bearing.................784,267
Interest-bearing..................2,833,907
Federal funds purchased and Securities sold under agreements to repurchase.. 293,862
Demand notes issued to the U.S. Treasury.................................... 64,550
Trading liabilities (from Schedule RC-D).................................... 0
Other borrowed money:....................................................... ///////
With original maturity of one year or less............................ 774,000
With original maturity of more than one year.......................... 43,000
Bank's liability on acceptances executed and outstanding.................... 0
Subordinated notes and debentures........................................... 0
Other liabilities (from Schedule RC-G)...................................... 95,672
Total liabilities........................................................... 4,889,258
EQUITY CAPITAL
Perpetual preferred stock and related surplus............................... 0
Common Stock................................................................ 500
Surplus (exclude all surplus related to preferred stock).................... 62,118
Undivided profits and capital reserves...................................... 371,107
Net unrealized holding gains (losses) on available-for-sale securities...... (2,139)
Total equity capital........................................................ 431,586
Total liabilities, limited-life preferred stock, and equity capital......... 5,320,844
Thousands of dollars
</TABLE>
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