XXXXXX RESOURCES, INC.
12% SINKING FUND BOND due December 31, 2007
$_____________ ______________, 2000
XXXXXX RESOURCES, INC., a New York corporation (the "Issuer"), for value
received, hereby promises to pay to _________________________________ or
registered assigns (the "Holder") on or before December 31, 2007, the principal
sum of ___________, in such coin or currency of the United States of America as
at the time of payment shall be legal tender therein for the payment of public
and private debts, and to pay interest on the principal amount outstanding under
this Bond from this date, at the rate of twelve percent (12%) per annum, in like
coin or currency, monthly on the first day of each month commencing on the first
month following the date of this Bond, until such principal amount has been paid
to the Holder hereof as shown in the Issuer's records, without presentment or
demand.
The interest so payable, and punctually paid or duly provided for on any
Interest Payment Date will, as provided in such Indenture, be paid to the Person
in whose name this Bond is registered at the close of business on the Record
Date for such Interest Payment Date, which shall be the 15th day (whether or not
a Business Day) as the case may be, next preceding such Interest Payment Date.
Payment of the principal of and Interest on this Bond will be made at the office
or agency of the Trustee maintained for that purpose in New York, New York, in
such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts; provided, however, that
at the option of the Issuer, payment of Interest may be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Bond Register. Interest shall be computed on the basis of a 360-day year and
shall accrue from the date of authentication of the originally issued Bond
represented by this certificate.
1. THE BOND EVIDENCED OR CONSTITUTED HEREBY HAS BEEN ACQUIRED FOR
INVESTMENT AND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). SUCH BOND OR THE UNDERLYING COMMON STOCK ISSUABLE UPON
CONVERSION OF THE BOND MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED
UNLESS THE REGISTRATION PROVISIONS OF SAID ACT OR APPLICABLE STATE LAW HAVE BEEN
COMPLIED WITH OR UNLESS THE ISSUER HAS RECEIVED AN OPINION OF ITS COUNSEL THAT
SUCH REGISTRATION IS NOT REQUIRED.
2. This Bond is one of a duly authorized issue of Bonds of the Issuer
designated as its 12% Sinking Fund Bonds due December 31, 2007 (herein called
the "Bonds"), limited in aggregate principal amount of $20,000,000 issued and to
be issued under an indenture dated as of __________, 2000 (herein called the
"Indenture"), between the Issuer and Continental Stock Transfer & Trust Company
as Trustee thereunder (herein called the "Trustee", which term includes any
successor trustee under the Indenture), to which Indenture and all Indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Issuer,
the Trustee, and the Holders of the Bonds and of the terms upon which the Bonds
are, and are to be, authenticated and delivered. All terms used in this Bond
which are defined in the Indenture shall have the meanings assigned to them in
the Indenture.
3. The rights of Holder to receive the principal sum or any part thereof,
and to receive the interest due on this Bond is and shall remain equal in
priority to the payment of the principal of and interest on (i) all future
obligations and guarantees of the Issuer for money borrowed from any bank, trust
company, insurance company or other financial institution engaged in the
business of lending money, for which the Issuer is at the time of determination
responsible or liable as obligor or guarantor, (ii) all existing or future
obligations of the Issuer Sinking Fund by a lien, mortgage, pledge or other
encumbrance against real or personal property of the Issuer, and (iii) any
modifications, renewals, extensions or refundings of the foregoing, except for
any of such obligations of the Issuer the payment of which is made expressly
subordinate and junior to this Bond.
4. As and for a sinking fund for the retirement of the Bonds, as more
particularly provided in the Indenture, the Issuer, as long as any of the Bonds
shall be outstanding, shall pay to the Trustee on or before the business day
which next precedes January 1 in each year commencing with the year 2003 to and
including 2007 (each such business day being herein referred to as a "Sinking
Fund Payment Date"), a sinking fund payment in cash or U.S. Treasury Bonds
maturing on or before December 31, 2007 (herein being referred to as a Sinking
Fund Payment"), in an amount equal to 16.6667% of the Bond sufficient in the
aggregate to fund repayment of the Bonds at maturity on December 31, 2007. The
Indenture also provides that under the circumstances specified therein funds may
be deposited with the Trustee or with any paying agent (other than the Issuer)
in advance of the maturity or redemption date of any of the Bonds, in trust for
the payment or redemption of such Bonds and the Interest due or to become due
thereon, and that thereupon all obligations of the Issuer in respect of such
Bonds shall cease and be discharged and the holders thereof shall thereafter be
restricted exclusively to such funds for any and all other claims on their part
under the Indenture or with respect to such Bonds.
5. The Holder of this Bond may tender to the Trustee this Bond or a portion
hereof for repurchase by the Issuer at a price of 100% of principal amount, plus
accrued but unpaid interest, commencing on December 31, 2002. The Issuer shall
be obligated to repurchase such Bond or Bonds on a first come, first served
basis, in any one calendar year in an amount up to 10% of the originally
outstanding principal amount of all Bonds issued, commencing with calendar year
2003. If all tenders received by the Trustee on the same Business Day, when
added to all prior tenders exceed the annual obligation of the Issuer to honor
such tenders, the Trustee shall notify the Issuer of the amount of such tenders,
and the Issuer shall (i) agree in writing to honor all such tenders, or (ii)
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advise the Trustee to pro-rate such tenders. If the Issuer shall not make an
election in writing within the period provided, the Trustee shall pro-rate such
tenders.
The Trustee shall give notice to the Issuer of all tenders for repurchase
within five (5) Business Days after the Trustee's receipt thereof. Provided that
the Issuer shall not have previously repurchased the maximum principal amount of
Bonds provided for, the Issuer shall have forty-five (45) days to deposit with
the Trustee the principal amount of the Bond, Bonds or part of a Bond tendered
for repurchase plus accrued but unpaid interest through and including the date
of such deposit, at the time of which deposit the Issuer's obligation to pay,
and the Holder's right to receive, interest on such principal amount shall
cease. Failure of the Issuer to make such a deposit within the time permitted
shall be an Event of Default under Article XIV of the Indenture.
6. The Bonds shall, upon notice to the Trustee, be redeemable in whole or
in part at the option of the Issuer on or after January 1, 2002 at a price of
105% of principal amount plus accrued interest to the Redemption Date; on or
after January 1, 2002 at a price decreasing annually from 104% to 100% of
principal amount ratably from years 2002 to 2007; as follows:
Period Payment Rate
January 1, 2002 to December 31, 2002 105% of par value, plus accrued interest
January 1, 2003 to December 31, 2003 104% of par value, plus accrued interest
January 1, 2004 to December 31, 2004 103% of par value, plus accrued interest
January 1, 2005 to December 31, 2005 102% of par value, plus accrued interest
January 1, 2006 to December 31, 2006 101% of par value, plus accrued interest
January 1, 2007 to December 31, 2007 100% of par value, plus accrued interest
Partial redemption shall be made pro rata to all Holders of the Bonds then
outstanding, in proportion to the principal amounts of Bonds held by each such
Holder. Upon any Redemption, the Holder shall deliver his Bond to the Trustee
for notation of partial redemption or cancellation if Redemption is made in
full; such delivery shall be made not later than the date fixed for Redemption
in the Issuer's notice thereof. Upon the close of business on such Redemption
Date, the conversion privilege of the Bond shall terminate to the extent of the
redemption of principal and no further interest shall accrue on the principal
portion of the Bond so redeemed. If the Holder shall fail to deliver his Bond to
the Trustee upon Redemption, the Issuer may deposit sufficient funds to make the
Redemption with the Trustee, whereupon all rights of the Holder with respect to
the portion of this Bond so redeemed, other than the right to receive the
Redemption Price, shall terminate.
Notice of Redemption shall be given by registered first-class mail, postage
prepaid, mailed at least sixty (60) days before the Redemption Date to the
Holder of this Bond at his address appearing on the records of the Trustee. The
Notice of Redemption shall state:
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(1) the Redemption Date,
(2) the Redemption Price,
(3) that on the Redemption Date the Redemption Price will become due and
payable and that interest thereon will cease to accrue on and after such date,
and
(4) the place where the Bond is to be surrendered for payment of the
Redemption Price and any accrued interest.
From and after any Redemption Date, this Bond shall cease to bear interest
and the only right of the Holder of this Bond will be to receive payment of the
Redemption Price which includes all interest accrued to the Redemption Date. If
this Bond is called for redemption, and shall not be so paid upon surrender
thereof for redemption, the principal shall, until paid, bear interest from the
Redemption Date at the Bond Interest Rate until the Redemption Price is paid in
full.
7. In the event of Redemption of this Bond in part only, a new Bond or
Bonds for the portion of this Bond not redeemed will be issued in the name of
the Holder hereof upon the cancellation of this Bond.
8. If an Event of Default shall occur and be continuing, the principal of
all the Bonds may be declared due and payable in the manner and with the effect
provided in the Indenture.
9. The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Bonds under the Indenture at any
time by the Issuer and the Trustee with the consent of the Holders of not less
than two-thirds in aggregate principal amount of the Bonds at the time
Outstanding. The Indenture also contains provisions permitting the Holders of a
majority in aggregate principal amount of the Bonds at the time Outstanding, on
behalf of the Holders of all the Bonds, to waive compliance by the Issuer with
certain provisions of the Indenture and certain past defaults (other than
payment of principal, interest, Trustee fees and certain events described in the
Indenture) under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Bond shall be conclusive and binding upon such
Holder and upon all future Holders of this Bond and of any Bond issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Bond.
10. No reference herein to the Indenture and no provision of this Bond or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Bond at the times, place and rate, and in the coin or currency,
herein provided or as provided in the Indenture.
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11. As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Bond for registration of transfer may be made at
the office or agency of the Trustee in New York, New York, duly endorsed by, or
accompanied by, a written instrument of transfer in form satisfactory to the
Issuer and the Trustee, duly executed by the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Bonds of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferee.
The Bonds are issuable only in fully certificated registered form. As
provided in the Indenture and subject to certain limitations therein set forth,
the Bonds are exchangeable for a like aggregate principal amount of Bonds of a
different authorized denomination, as requested by the Holder surrendering the
same.
No service charge shall be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charges payable in connection therewith.
No service charge shall be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charges payable in connection therewith.
12. Prior to due presentment of this Bond for registration of transfer, the
Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
Person in whose name this Bond is registered as the owner hereof for all
purposes, whether or not this Bond be overdue, and neither the Issuer, the
Trustee nor any such agent shall be affected by notice to the contrary.
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IN WITNESS WHEREOF, the Issuer has caused the Bonds to be executed and
delivered, under its corporate seal, by its Chief Executive Officer and attested
by its Secretary or an Assistant Secretary, on the date first above written.
XXXXXX RESOURCES, INC.
By: _____________________
Xxxxxx X. Xxxxxxx
Attest:__________________ Chief Executive Officer
[Corporate Seal]
ASSIGNMENT FORM
If you, the Holder, want to assign
this Bond, fill in the form below:
I, or we assign and transfer this
Bond to
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(Insert assignee's social security or tax ID number)
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(Print or type assignee's name, address and zip code)
and irrevocably appoint
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as agent to transfer this Bond on the books of the Issuer. The agent may
substitute another to act for him.
Date _______________________________
Your signature:__________________________
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(Sign exactly as your name appears on the
other side of this Bond)
Signature Guaranteed:
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The signature must be guaranteed by an officer of a commercial bank or trust
company or Member of the New York Stock Exchange
