EXHIBIT 4.38
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FLAGSTAR CORPORATION
ISSUER
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SUPPLEMENTAL INDENTURE
DATED AS OF , 1997
TO INDENTURE
DATED AS OF SEPTEMBER 23, 1993
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11-3/8% SENIOR SUBORDINATED DEBENTURES DUE 2003
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THE BANK OF NEW YORK
TRUSTEE
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THIS SUPPLEMENTAL INDENTURE, dated as of , 1997, between FLAGSTAR
CORPORATION, a Delaware corporation (the "Company"), and the BANK OF NEW YORK, a
national banking association, as trustee (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Company and the Trustee are parties to an Indenture, dated
as of September 23, 1993 (the "Indenture"), pursuant to which the Company issued
$125,000,000 in aggregate principal amount of 11-3/8% Senior Subordinated
Debentures due 2003 (the "Securities"); and
WHEREAS, Section 7.2 of the Indenture provides, among other things,
that with the consent of the Holders of not less than a majority in aggregate
principal amount of the Securities outstanding, the Company, when authorized by
a resolution of its Board of Directors, and the Trustee, may amend the Indenture
in certain respects; and
WHEREAS, pursuant to a Prospectus, dated , 1997, (the "Prospectus"),
the Company, among other things, solicited consents ("Consents") to a proposed
amendment to the Indenture as set forth herein; and
WHEREAS, the Company has obtained the requisite Consents to amend the
Indenture as provided herein and has delivered such Consents to the Trustee, all
as required by Section 7.2 of the Indenture; and
WHEREAS, the Company has duly authorized the execution and delivery of
this Supplemental Indenture, and all conditions and requirements necessary to
make this instrument a valid and binding agreement have been duly performed and
complied with;
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, receipt and sufficiency of which are hereby
acknowledged, it is mutually covenanted and agreed as follows:
ARTICLE 1.
AMENDMENT TO INDENTURE
Section 1.1. The Indenture is hereby amended by adding a new Section
4.12 as follows:
Section 4.12 Certain Distributions Upon Events of Bankruptcy.
Notwithstanding any provision to the contrary set forth in this Indenture, upon
(i) the occurrence of an event described in clause (6) or (7) of Section 4.1
hereof as a result of which the Issuer becomes subject to the jurisdiction of
the United States Bankruptcy Court, and (ii) pursuant to such event, the Issuer
seeks approvals for, and the Bankruptcy Court confirms, a plan of
reorganization substantially as described on Annex 1 attached hereto (the
"Plan"), then, to the extent necessary to implement the purposes and intent of
such Plan and as set forth below, Holders of the Securities together with the
holders of securities ranking pari passu in right of payment with the
Securities, shall make distributions to holders of securities ranking junior in
right of payment to the Securities as follows:
Holders of the Securities, together with the holders
of securities ranking PARI PASSU in right of payment with the
Securities, will make distributions to the holders of $2.25 Series A
Cumulative Convertible Exchangeable Preferred Stock (the "FCI Preferred
Stock") of Flagstar Companies, Inc. ("FCI") and holders of the $.50 par
value Common Stock (the "FCI Common Stock") of FCI, as intended to be
made to them pursuant to the Plan, if such classes of holders vote in
favor of the Plan, even if such classes would not otherwise be entitled
to a distribution under the terms of the Plan and the Bankruptcy Laws
because the Plan has not been accepted by one or more senior classes.
In accordance with the foregoing:
(i) if the holders of the 10% Debentures do not accept the Plan, but
the holders of the FCI Preferred Stock accept the Plan, holders of the
FCI Preferred Stock will receive the distributions of securities
otherwise allocated to them on Annex I hereto (and pursuant thereto,
the Trustee shall deliver, or instruct the Disbursing Agent under the
Plan to deliver, to the Transfer Agent for the FCI Preferred Stock for
distribution to the holders of the FCI Preferred Stock on the Effective
Date (as defined in the Plan), 500,000 shares of New Common Stock (as
defined in the Plan) of Reorganized Flagstar (as defined in the Plan)
which is the distribution which the holders of FCI Preferred Stock
would have received if all classes of holders of securities of FCI and
the Company had approved the Plan); and
(ii) if the holders of the 10% Debentures or the holders of the FCI
Preferred Stock do not accept the Plan, but holders of the FCI Common
Stock accept the Plan, holders of the FCI Common Stock will receive the
distribution of securities otherwise allocated to them as set forth on
Annex I hereto (and pursuant thereto, the Trustee shall deliver or
instruct the Disbursing Agent under the Plan to deliver to the Transfer
Agent for the FCI Common Stock for distribution to the holders of the
FCI Common Stock on the Effective Date, the New Warrants (as defined in
the Plan) which is the distribution which the holders of FCI Common
Stock would have received if all classes of holders of securities of
FCI and the Company had approved the Plan).
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ARTICLE 2.
MISCELLANEOUS
Section 2.1. The Trustee accepts the trusts created by the Indenture,
as supplemented by this Supplemental Indenture, and agrees to perform the same
upon the terms and conditions of the Indenture, as supplemented by this
Supplemental Indenture.
Section 2.2. The recitals contained herein shall be taken as statements
of the Company and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Supplemental Indenture.
Section 2.3. All capitalized terms used and not defined herein shall
have the respective meanings assigned to them in the Indenture.
Section 2.4. Each of the Company and the Trustee hereby confirms and
reaffirms the Indenture in every particular except as amended by this
Supplemental Indenture.
Section 2.5. All covenants and agreements in this Supplemental
Indenture by the Company or the Trustee shall bind each of their respective
successors and assigns, whether so expressed or not.
Section 2.6. In case any provisions in this Supplemental Indenture
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 2.7. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 2.8. All provisions of this Supplemental Indenture shall be
deemed to be incorporated in, and made a part of, the Indenture; and the
Indenture, as supplemented by this Supplemental Indenture, shall be read, taken
and construed as one and the same instrument.
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This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
FLAGSTAR CORPORATION
By: _______________________________________
Xxxxxx X. Xxxxxx, Senior Vice President
Attest:
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Name: _____________________
Title: ______________________
BANK OF NEW YORK,
Trustee
By: ________________________________
Name: __________________________
Title: _________________________
Attest:
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Name: _____________________
Title: ______________________
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STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this day of , 1997, before me personally came Xxxxxx X. Xxxxxx,
to me known, who, being by me personally sworn, did depose and say that she is a
Senior Vice President of Flagstar Corporation, the corporation described in and
on behalf of which she has executed the above instrument and that she is
authorized by said corporation to execute the same.
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Notary Public
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STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On this day of , 1997, before me personally came , to me known, who, being
by me personally sworn, did depose and say that he is the Vice President of the
Bank of New York, the corporation described in and on behalf of which he has
executed the above instrument and that he is authorized by said corporation to
execute the same.
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Notary Public
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