Exhibit 4.1
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INDENTURE
STAKE TECHNOLOGY LTD.
and
[TO BE NAMED]
Trustee
Dated as of __________________
$___________
______% Debentures Due _______
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X-1
TABLE OF CONTENTS
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ARTICLE 1 Definitions and Rules of Construction; Applicability of the
Trust Indenture Act ............................................. 1
Section 1.01 Definitions ......................................... 1
Section 1.02 Other Definitions ................................... 3
Section 1.03 Rules of Construction ............................... 3
Section 1.04 Trust Indenture Act ................................. 3
ARTICLE 2 The Securities .................................................. 4
Section 2.01 Form and Dating ..................................... 4
Section 2.02 Execution and Authentication ........................ 4
Section 2.03 Agents .............................................. 4
Section 2.04 Paying Agent To Hold Money in Trust ................. 4
Section 2.05 Securityholder Lists ................................ 5
Section 2.06 Transfer and Exchange ............................... 5
Section 2.07 Replacement Securities .............................. 5
Section 2.08 Outstanding Securities .............................. 5
Section 2.09 Treasury Securities Disregarded for Certain
Purposes ............................................ 6
Section 2.10 Temporary Securities ................................ 6
Section 2.11 Global Securities ................................... 6
Section 2.12 Cancellation ........................................ 6
Section 2.13 Defaulted Interest .................................. 7
ARTICLE 3 Redemption ...................................................... 7
Section 3.01 Notice to Trustee ................................... 7
Section 3.02 Selection of Securities To Be Redeemed .............. 7
Section 3.03 Notice of Redemption ................................ 8
Section 3.04 Effect of Notice of Redemption ...................... 8
Section 3.05 Deposit of Redemption Price ......................... 8
Section 3.06 Securities Redeemed in Part ......................... 9
ARTICLE 4 Covenants ....................................................... 9
Section 4.01 Payment of Securities ............................... 9
Section 4.02 SEC Reports ......................................... 9
Section 4.03 Compliance Certificate .............................. 9
Section 4.04 Notice of Certain Events ............................ 9
ARTICLE 5 Successors ...................................................... 10
Section 5.01 When Company May Merge, etc ......................... 10
Section 5.02 Successor Corporation Substituted ................... 10
ARTICLE 6 Defaults and Remedies ........................................... 10
Section 6.01 Events of Default ................................... 10
Section 6.02 Acceleration ........................................ 11
(1)
TABLE OF CONTENTS
(continued)
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Section 6.03 Other Remedies ...................................... 12
Section 6.04 Waiver of Past Defaults ............................. 12
Section 6.05 Control by Majority ................................. 12
Section 6.06 Limitation on Suits ................................. 12
Section 6.07 Rights of Holders To Receive Payment ................ 13
Section 6.08 Priorities .......................................... 13
Section 6.09 Undertaking for Costs ............................... 13
Section 6.10 Proof of Claim ...................................... 13
Section 6.11 Actions of a Holder ................................. 14
ARTICLE 7 Trustee ......................................................... 14
Section 7.01 Duties of Trustee ................................... 14
Section 7.02 Rights of Trustee ................................... 15
Section 7.03 Individual Rights of Trustee; Disqualification ...... 15
Section 7.04 Trustee's Disclaimer ................................ 15
Section 7.05 Notice of Defaults .................................. 15
Section 7.06 Reports by Trustee to Holders ....................... 15
Section 7.07 Compensation and Indemnity .......................... 16
Section 7.08 Replacement of Trustee .............................. 16
Section 7.09 Successor Trustee by Merger, etc .................... 17
Section 7.10 Eligibility ......................................... 17
Section 7.11 Preferential Collection of Claims Against Company ... 17
ARTICLE 8 Satisfaction and Discharge ...................................... 17
Section 8.01 Satisfaction and Discharge of Indenture ............. 17
Section 8.02 Application of Trust Funds .......................... 18
Section 8.03 Reinstatement ....................................... 19
Section 8.04 Repayment to Company ................................ 19
ARTICLE 9 Amendments ...................................................... 19
Section 9.01 Without Consent of Holders .......................... 19
Section 9.02 With Consent of Holders ............................. 19
Section 9.03 Compliance with Trust Indenture Act and
Section 12.03 ....................................... 20
Section 9.04 Revocation and Effect of Consents and Waivers ....... 20
Section 9.05 Notice of Amendment; Notation on or Exchange
of Securities ....................................... 21
Section 9.06 Trustee Protected ................................... 21
ARTICLE 10 Conversion ..................................................... 21
Section 10.01 To be provided ..................................... 21
ARTICLE 11 Subordination .................................................. 21
Section 11.01 To be provided ..................................... 21
(ii)
TABLE OF CONTENTS
(continued)
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ARTICLE 12 Miscellaneous .................................................. 21
Section 12.01 Notices ............................................ 21
Section 12.02 Communication by Holders with Other Holders ........ 22
Section 12.03 Certificate and Opinion as to Conditions Precedent . 22
Section 12.04 Statements Required in Certificate or Opinion ...... 22
Section 12.05 Rules by' Trustee and Agents ....................... 22
Section 12.06 Legal Holidays ..................................... 23
Section 12.07 No Recourse Against Others ......................... 23
Section 12.08 Duplicate Originals ................................ 23
Section 12.09 Variable Provisions ................................ 23
Section 12.10 Governing Law ...................................... 24
EXHIBIT A - Face of Security
(iii)
CROSS-REFERENCE TABLE
TIA Section Indenture Section
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310 (a)(1) ............................................. 7.I0
(a)(2) ............................................. 7.10
(a)(3) ............................................. N.A.
(a)(4) ............................................. N.A.
(a)(5) ............................................. N.A.
(b) ................................................ 7.08; 7.10
(c) ................................................ N.A.
311 (a) ................................................ 7.11
(b) ................................................ 7.11
(c) ................................................ N.A.
312 (a) ................................................ 2.05
(b) ................................................ 12.02
(c) ................................................ N.A.
313 (a) ................................................ 7.06
(b)(l) ............................................. N.A.
(b)(2) ............................................. 7.00
(c) ................................................ 7.06
(d) ................................................ 7.06
314 (a)(1) ............................................. 4.02
(a)(2) ............................................. 12.01
(a)(4) ............................................. 4.03
(b) ................................................ N.A.
(c) ................................................ 2.02;7.02(b);8.01(3)
(c)(l) ............................................. 13.04
(c)(2) ............................................. 13.04
(c)(3) ............................................. 13.04
(d) ................................................ N.A.
(e) ................................................ 4.03;12.04
(f) ................................................ 4.03
315 (a)(1) ............................................. 6.05;7.01(b)(t)
(a)(2) ............................................. 7.01(b)(2)
(b) ................................................ 7.05; 12.01
(c) ................................................ 7.01(a)
(d)(1) ............................................. 7.0t(b)
(d)(2) ............................................. 7.01(c)(2)
(d)(3) ............................................. 6.05;7.01(c)(3)
(e) ................................................ 6.09
316 (a)(last sentence) ................................. 2.09
(a)(t)(A) .......................................... 6.05
(a)(1)(B) .......................................... 6.04
(a)(2)
(b) ................................................ 6.07
(c) ................................................ 9.04
317 (a)(1)
(a)(2)
(b) ................................................ 2.04
318 (a)
N.A. means not applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of this Indenture.
(iv)
INDENTURE dated as of ___________, between STAKE TECHNOLOGY LTD., a
corporation organized and existing under the laws of Canada ("Company"), and
[_____________], a [New York] corporation ("Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Company's ___%
Debentures Due ____ ("Securities"):
ARTICLE 1
Definitions and Rules of Construction; Applicability of the Trust Indenture Act
Section 1.01 Definitions.
"Affiliate" Any Person controlling or controlled by or under common
control with the Company. "Control" for this definition means the power to
direct the management and policies of a Person, directly or indirectly, whether
through the ownership of voting securities, by contract, or otherwise. The terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" Any Registrar, Paying Agent or Conversion Agent.
"Board" The Board of Directors of the Company or any officer or
committee thereof authorized to act for such Board.
"Business Day" A day that is not a Legal Holiday.
"Company" The party named as such above until a successor which duly
assumes the obligations upon the Securities and under the Indenture replaces it
and thereafter means the successor.
"Debt" means, with respect to any Person, (i) any obligation of such
Person to pay the principal of, premium of, if any, interest on (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company, whether or not a claim for such
post-petition interest is allowed in such proceeding), penalties, reimbursement
or indemnification amounts, fees, expenses or other amounts relating to any
indebtedness, and any other liability, contingent or otherwise, of such Person
(A) for borrowed money (including instances where the recourse of the lender is
to the whole of the assets of such Person or to a portion thereof), (B)
evidenced by a note, debenture or similar instrument (including a purchase money
obligation) including securities, (C) for any letter of credit or performance
bond in favor of such Person, or (D) for the payment of money relating to a
capitalized lease obligation; (ii) any liability of others of the kind described
in the preceding clause (i), which the Person has guaranteed or which is
otherwise its legal liability; (iii) any obligation of the type described in
clauses (i) and (ii) secured by a lien to which the property or assets of such
Person are subject, whether or not the obligations secured thereby shall have
been assumed by or shall otherwise be such Person's legal liability; and (iv)
any and all deferrals, renewals, extensions and refunding of, or amendments,
modifications or supplements to, any liability of the kind described in any of
the preceding clauses (i), (ii) or (iii).
"Default" Any event which is, or after notice or passage of time
would be, an Event of Default.
"Exchange Act" The Securities Exchange Act of 1934, as amended.
"Holder" or "Securityholder" A Person in whose name a Security is
registered.
"Indenture" This Indenture as amended from time to time, including
the terms of the Securities and any amendments.
"Officers' Certificate" A certificate signed by two Officers, one of
whom must be the President, the Treasurer or a Vice-President of the Company.
See Sections 12.03 and 12.04.
"Opinion of Counsel" Written opinion from legal counsel who is
acceptable to the Trustee. See Sections 12.03 and 12.04.
"Person" Any individual, corporation, partnership, joint venture,
association, limited liability company, joint stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof.
"Principal" of a Security means the principal of the Security plus
the premium, if any, on the Security which is due or overdue or is to become due
at the relevant time.
"Proceeding" A liquidation, dissolution, bankruptcy, insolvency,
reorganization, receivership or similar proceeding under Bankruptcy Law, an
assignment for the benefit of creditors, any marshalling of assets or
liabilities, or winding up or dissolution, but shall not include any transaction
permitted by and made in compliance with Article 5.
"SEC" The Securities and Exchange Commission.
"Securities" The Securities described above issued under this
Indenture.
"TIA" The Trust Indenture Act of 1939, as amended, as in effect on
the date of this Indenture, except as provided in Sections 1.04 and 9.03.
"Trust Officer" Any officer or assistant officer of the Trustee
assigned by the Trustee to administer its corporate trust matters or to whom a
matter concerning the Indenture may be referred.
"Trustee" The party named as such above until a successor replaces
it and thereafter means the successor.
"U.S. Government Obligations" Securities that are direct,
noncallable, nonredeemable obligations of, or noncallable, nonredeemable
obligations guaranteed by, the United States of America for the timely payment
of which obligation or guarantee the full faith and credit of the United States
of America is pledged, or funds consisting solely of such securities, including
funds managed by the Trustee or one of its Affiliates (including such funds for
which it or its Affiliates receives fees in connection with such management).
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Section 1.02 Other Definitions.
Defined
Term in Section
"Bankruptcy Law" 6.01
"Conversion Agent" 2.03
"Custodian" 6.01
"Defaulted Interest" 2.13
"Event of Default" 6.01
"Legal Holiday" 12.06
"Notice" 12.01
"Officer" 12.09
"Paying Agent" 2.03
"Registrar" 2.03
Section 1.03 Rules of Construction. Unless the context otherwise
requires:
(1) a term defined in Sections 1.01 or 1.02 has the meaning assigned
to it therein, and terms defined in the TIA have the meanings assigned to
them in the TIA;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting principles
in the United States;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the
plural include the singular;
(5) provisions apply to successive events and transactions;
(6) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other subdivision; and
(7) "including" means including without limitation.
Section 1.04 Trust Indenture Act. The provisions of TIA xx.xx. 310
through 317 that impose duties on any Person (including the provisions
automatically deemed included herein unless expressly excluded by this
Indenture) are a part of and govern this Indenture upon and so long as the
Indenture and Securities are subject to the TIA. If any provision of this
Indenture limits, qualifies or conflicts with such duties, the imposed duties
shall control. If a provision of the TIA requires or permits a provision of this
Indenture and the TIA provision is amended, then the Indenture provision shall
be automatically amended to like effect.
[Any reference to a requirement under the TIA shall only apply upon
and so long as the Indenture is qualified under and subject to the TIA.]
-3-
ARTICLE 2
The Securities
Section 2.01 Form and Dating. The Securities and the certificate of
authentication shall be substantially in the form of Exhibit A, which is hereby
incorporated in and expressly made a part of this Indenture. The Securities may
have notations, legends or endorsements required by Section 2.11, law, stock
exchange rule, automated quotation system, agreements to which the Company is
subject, or usage. Each Security shall be dated the date of its authentication.
Section 2.02 Execution and Authentication. Two Officers shall sign
the Securities for the Company by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds that
office at the time the Security is authenticated, the Security is still valid.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate Securities for original issue up to
the amount stated in paragraph 4 of Exhibit A in accordance with an Officers'
Certificate of the Company. The aggregate principal amount of Securities
outstanding at any time may not exceed that amount except as provided in Section
2.07.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities. An authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company or
an Affiliate.
Section 2.03 Agents. The Company shall maintain an office or agency
where Securities may be presented for registration of transfer or for exchange
("Registrar"), where Securities may be presented for payment ("Paying Agent")
and where Securities may be presented for conversion to the extent and in the
manner set forth in Article 10 ("Conversion Agent"). Whenever the Company must
issue or deliver Securities pursuant to this Indenture, the Trustee shall
authenticate the Securities at the Company's request. The Registrar shall keep a
register of the Securities and of their transfer and exchange.
The Company may appoint more than one Registrar, Paying Agent or
Conversion Agent. The Company shall notify the Trustee of the name and address
of any Agent not a party to this Indenture. If the Company does not appoint
another Registrar, Paying Agent, or Conversion Agent, the Trustee shall act as
such.
Section 2.04 Paying Agent To Hold Money in Trust. On or prior to
each due date of the Principal and interest on any Security, the Company shall
deposit with the Paying Agent a sum sufficient to pay such Principal and
interest when so becoming due. The Company
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shall require each Paying Agent (other than the Trustee) to agree in writing
that the Paying Agent will hold in trust for the benefit of Securityholders or
the Trustee all money held by the Paying Agent for the payment of the Principal
of or interest on the Securities and will notify the Trustee of any Default by
the Company in making any such payment. While any such Default continues, the
Trustee may require a Paying Agent to pay all money held by it to the Trustee.
The Company at any time may require a Paying Agent to pay all money held by it
to the Trustee and to account for any funds disbursed by the Paying Agent. Upon
complying with this Section, the Paying Agent shall have no further liability
for the money delivered to the Trustee. If the Company or any Affiliate acts as
Paying Agent, it shall segregate the money held by it as Paying Agent and hold
it as a separate trust fund.
Section 2.05 Securityholder Lists. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall furnish to the Trustee, in writing at least 10
Business Days before each interest payment date and at such other times as the
Trustee may request a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of Securityholders.
Section 2.06 Transfer and Exchange. The Securities shall be issued
in registered form and shall be transferable only upon surrender of a Security
for registration of transfer. When a Security is presented to the Registrar with
a request to register a transfer or to exchange them for an equal principal
amount of Securities of other denominations, the Registrar shall register the
transfer or make the exchange if its requirements for such transactions are met
and the Security has not been redeemed. The Company may charge a reasonable fee
for any registration of transfer or exchange but not for any exchange pursuant
to Section 2.10, 3.06 or 9.05.
All Securities issued upon any transfer or exchange pursuant to the
terms of this Indenture will evidence the same debt and will be entitled to the
same benefits under this Indenture as the Securities surrendered upon such
transfer or exchange.
Section 2.07 Replacement Securities. If the Holder of a Security
claims that the Security has been lost, destroyed or wrongfully taken, then, in
the absence of notice to the Company that the Security has been acquired by a
protected purchaser, the Company shall issue a replacement Security. If required
by the Trustee or the Company, an indemnity bond must be provided which is
sufficient in the judgment of both to protect the Company, the Trustee and the
Agents from any loss which any of them may suffer if a Security is replaced. The
Company or the Trustee may charge the Holder for its expenses in replacing a
Security.
Every replacement Security is an additional obligation of the
Company.
Section 2.08 Outstanding Securities. Securities outstanding at any
time are all Securities authenticated by the Trustee except for those canceled
by the Registrar, those delivered to it for cancellation and those described in
this Section as not outstanding. A Security does not cease to be outstanding
because the Company or an Affiliate holds the Security.
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If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Company receives proof satisfactory to it that the
replaced Security is held by a protected purchaser.
If Securities are considered paid under Section 4.01, they cease to
be outstanding and interest on them ceases to accrue.
Section 2.09 Treasury Securities Disregarded for Certain Purposes.
In determining whether the Holders of the required Principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company or an Affiliate shall be disregarded and deemed not to be
outstanding, except that, for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities which the Trustee knows are so owned shall be so disregarded.
Securities so owned which have been pledged in good faith shall not be
disregarded if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right to deliver any such direction, waiver or consent with respect to
the Securities and that the pledgee is not the Company or any other obligor upon
the Securities or any Affiliate of the Company or of such other obligor.
Section 2.10 Temporary Securities. Until definitive Securities are
ready for delivery, the Company may use temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall deliver definitive Securities in
exchange for temporary Securities.
Section 2.11 Global Securities. The Company may issue some or all of
the Securities in temporary or permanent global form. The Company may issue a
global Security only to a depository. A depository may transfer a global
Security only to its nominee or to a successor depository. A global Security
shall represent the amount of Securities specified in the global Security. A
global Security may have variations that the depository requires or that the
Company considers appropriate for such a security.
Beneficial owners of part or all of a global Security are subject to
the rules of the depository as in effect from time to time.
The Company, the Trustee and the Agents shall not be responsible for
any acts or omissions of a depository, for any depository records of beneficial
ownership interests or for any transactions between the depository and
beneficial owners.
Section 2.12 Cancellation. The Company at any time may deliver
Securities to the Trustee for cancellation. The Paying Agent and Conversion
Agent, if not the Trustee, shall forward to the Trustee any Securities
surrendered to them for payment or conversion. The Trustee shall cancel all
Securities surrendered for registration of transfer, exchange, payment,
conversion or cancellation and shall dispose of canceled Securities according to
its standard procedures or as the Company otherwise directs. The Company may not
issue new Securities to replace Securities that it has paid or which have been
delivered to the Trustee for cancellation or that any Securityholder has
converted.
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Section 2.13 Defaulted Interest. If the Company defaults in a
payment of interest on the Securities ("Defaulted Interest") such Defaulted
Interest shall cease to be payable to the Securityholder on the relevant record
date and shall be paid by the Company, at its election, under either (1) or (2)
below:
(1) The Company may pay the Defaulted Interest together with
interest thereon to the Persons which are Securityholders on a subsequent
special record date. The Company shall notify the Trustee of the amount of
Defaulted Interest together with interest thereon to be paid and pay over
such amount to the Trustee. The Trustee shall then fix a special record
date and at the Company's expense shall notify Securityholders not less
than 10 days prior to such special record date of the proposed payment, of
the special record date, and of the payment date.
(2) The Company may make payment of Defaulted Interest together with
interest thereon in any lawful manner not inconsistent with the
requirements of any securities exchange or automated quotation system on
which the Securities may be listed or designated for issuance. The Company
shall give prompt notice to the Trustee and Securityholders that it
intends to make payment pursuant to this Section 2.13(2) and of the
special record date of the proposed payment, and of the payment date.
ARTICLE 3
Redemption
Section 3.01 Notice to Trustee. If Securities are to be redeemed,
the Company shall notify the Trustee of the redemption date, the Principal
amount of Securities to be redeemed and the provision of the Securities
permitting or requiring the redemption.
The Company may reduce the Principal amount of Securities required
to be redeemed pursuant to Paragraph Six of the Securities if it notifies the
Trustee of the amount of the credit and the basis for it by delivery of an
Officers' Certificate. If the reduction is based on a credit for redeemed,
converted or canceled Securities that the Company has not previously delivered
to the Trustee for cancellation, the Company shall deliver such Securities to
the Registrar before the selection of securities to be redeemed.
The Company shall give each notice provided for in this Section at
least 50 days before the redemption date unless a shorter period is satisfactory
to the Trustee. If fewer than all the Securities are to be redeemed, the record
date relating to such redemption shall be selected by the Company and given to
the Trustee, which record date shall be not less than 15 days prior to the
redemption date.
Section 3.02 Selection of Securities To Be Redeemed. If less than
all the Securities are to be redeemed, the Trustee shall select the Securities
to be redeemed by a method that complies with the requirements, if any, of any
stock exchange on which the Securities are listed and that the Trustee considers
fair and appropriate, which may include selection pro rata or by lot. The
Trustee shall make the selection from Securities outstanding not previously
called for redemption. The Trustee may select for redemption portions of the
Principal of Securities
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that have denominations larger than $1,000. Securities and portions thereof
selected by the Trustee shall be in amounts of $1,000 or whole multiples of
$1,000. Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption.
Section 3.03 Notice of Redemption. At least 30 days but not more
than 60 days before a redemption date, the Company shall mail a notice of
redemption to each Holder whose Securities are to be redeemed.
The notice shall state that it is a notice of redemption, identify
the Securities to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent and Conversion Agent;
(4) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(5) that, unless the Company defaults in making such redemption
payment or the Paying Agent is prohibited from making such payment
pursuant to the terms of this Indenture, interest on Securities (or
portion thereof) called for redemption ceases to accrue on and after the
redemption date; and
(6) list the CUSIP number of the Securities and state that no
representation is made as to the correctness or accuracy of the CUSIP
number, if any, listed in such notice or printed on the Securities.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense.
Section 3.04 Effect of Notice of Redemption. Once notice of
redemption is mailed, Securities called for redemption become due and payable on
the redemption date at the redemption price. Upon surrender to the Paying Agent,
such Securities shall be paid at the redemption price stated in the notice, plus
accrued interest to the redemption date. Failure to give notice or any defect in
the notice to any Holder shall not affect the validity of the notice to any
other Holder.
Section 3.05 Deposit of Redemption Price. On or before the
redemption date, the Company shall deposit with the Paying Agent (or, if the
Company or any Affiliate is the Paying Agent, shall segregate and hold in trust)
money sufficient to pay the redemption price of, and accrued interest on, all
Securities to be redeemed on that date other than Securities or portions of
Securities called for redemption which have been delivered by the Company to the
Registrar for cancellation. The Paying Agent shall return to the Company any
money not required for that purpose because of conversion of Securities.
-8-
Unless the Company shall default in the payment of Securities (and
accrued interest) called for redemption, interest on such Securities shall cease
to accrue after the redemption date.
Section 3.06 Securities Redeemed in Part. Upon surrender of a
Security that is redeemed in part, the Company shall deliver to the Holder (at
the Company's expense) a new Security equal in Principal amount to the
unredeemed portion of the Security surrendered.
ARTICLE 4
Covenants
Section 4.01 Payment of Securities. The Company shall pay the
Principal of and interest on the Securities on the dates and in the manner
provided in the Securities and this Indenture. Principal and interest shall be
considered paid on the date due if the Paying Agent holds in accordance with
this Indenture on that date money sufficient to pay all Principal and interest
then due and the Paying Agent is not prohibited from paying such money to the
Holders on such date pursuant to the terms of this Indenture.
The Company shall pay interest on overdue Principal at the rate
borne by the Securities; it shall pay interest on overdue Defaulted Interest at
the same rate to the extent lawful.
Section 4.02 SEC Reports. The Company shall file with the Trustee
within 15 days after it files them with the SEC copies of the annual reports and
of the information, documents, and other reports which the Company is required
to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. The
Company will cause any quarterly and annual reports which it makes available to
its stockholders to be mailed to the Holders. The Company will also comply with
the other provisions of TIA ss. 314(a). Delivery of such reports, information
and documents to the Trustee is for informational purposes only and the
Trustee's receipt of such shall not constitute notice or constructive notice of
any information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).
Section 4.03 Compliance Certificate. The Company shall deliver to
the Trustee, within [105] days after the end of each fiscal year of the Company,
a brief certificate signed by the principal executive officer, principal
financial officer or principal accounting officer of the Company, as to the
signer's knowledge of the Company's compliance with all conditions and covenants
contained in this Indenture (determined without regard to any period of grace or
requirement of notice provided herein).
Section 4.04 Notice of Certain Events. The Company shall give prompt
written notice to the Trustee and any Paying Agent of (i) any Proceeding, (it)
any Default or Event of Default, (iii) any cure or waiver of any Default or
Event of Default, and (iv) if and when the Securities are listed on any stock
exchange.
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ARTICLE 5
Successors
Section 5.01 When Company May Merge, etc. The Company shall not
consolidate or merge with or into, or transfer all or substantially all of its
assets to, any Person unless:
(1) either the Company shall be the resulting or surviving entity or
such person is a corporation organized and existing under the laws of the
United States, a State thereof or the District of Columbia;
(2) if the Company is not the resulting or surviving entity, such
Person assumes by supplemental indenture all the obligations of the
Company under the Securities and this Indenture; and
(3) immediately before and immediately after the transaction no
Default exists.
The Company shall deliver to the Trustee prior to the proposed
transaction an Officers' Certificate and an Opinion of Counsel, each of which
shall state that such consolidation, merger or transfer and such supplemental
indenture comply with this Article 5 and that all conditions precedent herein
provided for relating to such transaction have been complied with.
Section 5.02 Successor Corporation Substituted. Upon any
consolidation or merger, or any transfer of all or substantially all of the
assets of the Company in accordance with Section 5.01, the successor corporation
formed by such consolidation or into which the Company is merged or to which
such transfer is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture and the Securities
with the same effect as if such successor corporation had been named as the
Company herein and in the Securities. Thereafter the obligations of the Company
under the Securities and Indenture shall terminate except for the obligation to
pay the Principal of and interest on the securities in the case of a transfer.
ARTICLE 6
Defaults and Remedies
Section 6.01 Events of Default. An "Event of Default" occurs if:
(1) the Company Defaults in the payment of interest on any Security
when the same becomes due and payable and such Default continues for a
period of [30] days;
(2) the Company Defaults in the payment of the Principal of any
Security when the same becomes due and payable at maturity, upon
redemption or otherwise;
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(3) the Company fails to comply with any of its other agreements in
the Securities or this Indenture and such failure continues for the period
and after the notice specified below;
(4) the Company pursuant to or within the meaning of any Bankruptcy
Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in
an involuntary case,
(C) consents to the appointment of a Custodian of it or for
all or substantially all of its property, or
(D) makes a general assignment for the benefit of its
creditors; or
(5) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company in an involuntary case,
(B) appoints a Custodian of the Company or for all or
substantially all of its property, or
(C) orders the liquidation of the Company, and the order or
decree remains unstayed and in effect for 60 days.
The foregoing will constitute Events of Default whatever the reason
for any such Event of Default, whether it is voluntary or involuntary, or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means title 11, U.S. Code or any similar
Federal or state law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator or similar official under any Bankruptcy
Law.
A Default under clause (3) is not an Event of Default until the
Trustee or the Holders of at least 25% in Principal amount of the Securities
notify the Company and the Trustee of the Default and the Company does not cure
the Default, or it is not waived, within [60] days after receipt of the notice.
The notice must specify the Default, demand that it be remedied to the extent
consistent with law, and state that the notice is a "Notice of Default".
Section 6.02 Acceleration. If an Event of Default occurs and is
continuing, the Trustee by notice to the Company, or the Holders of at least 25%
in Principal amount of the Securities by notice to the Company and the Trustee,
may declare the Principal of and accrued interest on all the Securities to be
due and payable. Upon such declaration the Principal and interest shall be due
and payable immediately.
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The Holders of a majority in Principal amount of the Securities by
notice to the Company and the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default have been cured or waived except
nonpayment of Principal or interest that has become due solely because of the
acceleration.
Section 6.03 Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of Principal or interest on the Securities or to enforce the performance of any
provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Securities or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Securityholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04 Waiver of Past Defaults. The Holders of a majority in
Principal amount of the Securities by notice to the Trustee may waive an
existing Default and its consequences except:
(1) a Default in the payment of the Principal of or interest on any
Security; or
(2) a Default with respect to a provision that under Section 9.02
cannot be amended without the consent of each Securityholder affected; or
Section 6.05 Control by Majority. The Holders of a majority in
Principal amount of the Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee. However, the Trustee may refuse to
follow any direction that conflicts with law or this Indenture, is unduly
prejudicial to the rights of other Securityholders, or would involve the Trustee
in personal liability or expense for which the Trustee has not received a
satisfactory indemnity therefor.
Section 6.06 Limitation on Suits. A Securityholder may pursue a
remedy with respect to this Indenture or the Securities only if:
(1) the Holder gives to the Trustee notice of a continuing Event of
Default;
(2) the Holders of at least 25% in Principal amount of the
Securities make a request to the Trustee to pursue the remedy;
(3) the Trustee either (i) gives to such Holders notice it will not
comply with the request, or (ii) does not comply with the request within
[15 or 30] days after receipt of the request; and
(4) the Holders of a majority in Principal amount of the Securities
do not give the Trustee a direction inconsistent with the request prior to
the earlier of the date, if ever,
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on which the Trustee delivers a notice under Section 6.06(3)(i) or the
expiration of the period described in Section 6.06(3)(ii).
A Securityholder may not use this Indenture to prejudice the rights
of another Securityholder or to obtain a preference or priority over another
Securityholder.
Section 6.07 Rights of Holders To Receive Payment. Notwithstanding
any other provision of this Indenture, the right of any Holder of a Security to
receive payment of Principal and interest on the Security, on or after the
respective due dates expressed in the Security, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of the Holder.
Nothing in this Indenture limits or defers the right or ability of
Holders to petition for commencement of a case under applicable Bankruptcy Law
to the extent consistent with such Bankruptcy Law.
Section 6.08 Priorities. After an Event of Default any money or
other property distributable in respect of the Company's obligations under this
Indenture shall be paid in the following order:
First: to the Trustee (including any predecessor Trustee) for
amounts due under Section 7.07;
Second: to Securityholders for amounts due and unpaid on the
Securities for Principal and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Securities for Principal and interest, respectively; and
Third: to the Company.
The Trustee may fix a record date and payment date for any payment
to Securityholders.
Section 6.09 Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of
more than 10% in Principal amount of the Securities.
Section 6.10 Proof of Claim. In the event of any Proceeding, the
Trustee may file a claim for the unpaid balance of the Securities in the form
required in the Proceeding and cause the claim to be approved or allowed.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Securityholder any plan of
reorganization, arrangement, adjustment, or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Securityholder in any Proceeding.
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Section 6.11 Actions of a Holder. For the purpose of providing any
consent, waiver or instruction to the Company or the Trustee, a "Holder" or
"Securityholder" shall include a Person who provides to the Company or the
Trustee, as the case may be, an affidavit of beneficial ownership of a Security
together with a satisfactory indemnity against any loss, liability or expense to
such party to the extent that it acts upon such affidavit of beneficial
ownership (including any consent, waiver or instructions given by a Person
providing such affidavit and indemnity).
ARTICLE 7
Trustee
Section 7.01 Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise such of the rights and
powers vested in it by this Indenture, and use the same degree of care and skill
in their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of its own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are specifically
set forth in this Indenture and no others.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section.
(2) The Trustee shall not be liable for any error of judgment made
in good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(4) The Trustee may refuse to perform any duty or exercise any right
or power which would require it to expend its own funds or risk any
liability if it shall reasonably believe that repayment of such funds or
adequate indemnity against such risk is not reasonably assured to it.
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(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 7.02 Rights of Trustee. (a) The Trustee may rely on any
document believed by it to be genuine and to have been signed or presented by
the proper Person. The Trustee need not investigate any fact or matter stated in
the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on the
Officers' Certificate or an Opinion of Counsel. The Trustee may also consult
with counsel on any matter relating to the Indenture or the Securities and the
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on the advice of counsel.
(c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers.
(e) Except in connection with compliance with TIA ss. 310 or ss.
311, the Trustee shall only be charged with knowledge of Trust Officers.
Section 7.03 Individual Rights of Trustee; Disqualification. The
Trustee in its individual or any other capacity may become the owner or pledgee
of Securities and may otherwise deal with the Company or an Affiliate with the
same rights it would have if it were not Trustee. Any Agent may do the same with
like rights. However, the Trustee is subject to TIA ss. 310(b) and ss. 311.
Section 7.04 Trustee's Disclaimer. The Trustee shall have no
responsibility for the validity or adequacy of this Indenture or the Securities,
it shall not be accountable for the Company's use of the proceeds from the
Securities and it shall not be responsible for any statement in the Securities
other than its authentication.
Section 7.05 Notice of Defaults. If a continuing Default is known to
the Trustee, the Trustee shall mail to Securityholders a notice of the Default
within 90 days after it occurs. Except in the case of a Default in payment on
any Security, the Trustee may withhold the notice if and so long as a committee
of its Trust Officers in good faith determines that withholding the notice is in
the interests of Securityholders. [The Trustee shall mail to Securityholders any
notice it receives from Securityholder(s) under Section 6.06, and of any notice
the Trustee provides pursuant to Section 6.06(3)( 1).]
Section 7.06 Reports by Trustee to Holders. If required pursuant to
TIA ss. 313(a), within 60 days after the reporting date stated in Section 12.09,
the Trustee shall mail to
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Securityholders a brief report dated as of such reporting date that complies
with TIA ss. 313(a). The Trustee also shall comply with TIA ss. 313(b)(2).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each stock exchange on which the Securities are
listed.
Section 7.07 Compensation and Indemnity. The Company shall pay to
the Trustee from time to time reasonable compensation for its services,
including for any Agent capacity in which it acts. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred by it. Such expenses shall include the
reasonable compensation and out-of-pocket expenses of the Trustee's agents and
counsel.
The Company shall indemnify the Trustee against any loss, liability
or expense incurred by it including in any Agent capacity in which it acts. The
Trustee shall notify the Company promptly of any claim for which it may seek
indemnity. The Company shall defend the claim and the Trustee shall cooperate in
the defense. The Trustee may have separate counsel and the Company shall pay the
reasonable fees and expenses of such counsel. The Company need not pay for any
settlement made without its consent, which consent shall not unreasonably be
withheld.
The Company need not reimburse any expense or indemnify against any
loss or liability incurred by the Trustee through gross negligence, wilful
misconduct or bad faith.
To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee, except that held in trust to pay Principal and
interest on particular Securities.
Without prejudice to its rights hereunder, when the Trustee incurs
expenses or renders services after an Event of Default specified in Section
6.01(4) or (5) occurs, the expenses and the compensation for the services are
intended to constitute expenses of administration under any Bankruptcy Law.
Section 7.08 Replacement of Trustee. A resignation or removal of the
Trustee and appointment of a successor Trustee shall become effective only upon
the successor Trustee's acceptance of appointment as provided in this Section.
The Trustee may resign by so notifying the Company. The Holders of a
majority in Principal amount of the Securities may remove the Trustee by so
notifying the Trustee and the Company. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
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If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee.
If a successor Trustee is not appointed and does not take office
within 30 days after the retiring Trustee resigns, the retiring Trustee may
appoint a successor Trustee at any time prior to the date on which a successor
Trustee takes office. If a successor Trustee does not take office within [45]
days after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or, subject to Section 6.09, any Securityholder may petition any court
of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee. Within one year after a successor
Trustee appointed by the Company or a court pursuant to this Section 7.08 takes
office, the Holders of a majority in Principal amount of the Securities may
appoint a successor Trustee to replace such successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 7.07.
Section 7.09 Successor Trustee by Merger, etc. If the Trustee
consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation, the successor corporation
without any further act shall be the successor Trustee, if such successor
corporation is eligible and qualified under Section 7.10.
Section 7.10 Eligibility. This Indenture shall always have a Trustee
who satisfies the requirements of TIA ss. 310(a)(1) and ss. 310(a)(2). The
Trustee shall always have a combined capital and surplus as stated in Section
12.09.
Section 7.11 Preferential Collection of Claims Against Company. Upon
and so long as the Indenture is qualified under the TIA, the Trustee is subject
to TIA ss. 311(a), excluding any creditor relationship listed in TIA ss. 311(b).
A Trustee who has resigned or been removed is subject to TIA ss. 311(a) to the
extent indicated.
ARTICLE 8
Satisfaction and Discharge
Section 8.01 Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect (except as to any surviving rights of
conversion, registration of transfer or exchange of Securities expressly
provided for herein), and the Trustee, on demand of and at expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
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(1) either
(A) all Securities theretofore authenticated and delivered
(other than (i) Securities which have been destroyed, lost or stolen
and which have been replaced or paid as provided in Section 2.07 and
(ii) Securities for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the Company
and thereafter repaid to the Company or discharged from such trust,
as provided in Section 8.04) have been delivered to the Trustee for
cancellation; or
(B) all such Securities not theretofore delivered to the
Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their stated
maturity within one year, or
(iii) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the giving
of notice of redemption by the Trustee in the name, and at the
expense, of the Company,
and the Company in the case of (i), (ii), and (iii) above, has
deposited or caused to be deposited with the Trustee as trust
funds in trust for the purpose an amount of money or U.S.
Government Obligations sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for Principal and
interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the stated
maturity or redemption date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge
of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Holders under Section 4.01, to the Trustee
under Section 7.07, and, if money or U.S. Government Obligations shall have been
deposited with the Trustee pursuant to subclause (B) of Clause (1) of this
Section, the obligations of the Trustee under Section 8.02 shall survive.
Section 8.02 Application of Trust Funds. The Trustee or Paying Agent shall hold
in trust, for the benefit of the Holders, all money and U.S. Government
Obligations deposited with it (or into which such money and U.S. Government
Obligations are reinvested) pursuant to Section 8.01. It shall apply such
deposited money and money from U.S. Government
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Obligations in accordance with this Indenture to the payment of the Principal
and interest on the Securities. Money and U.S. Government Obligations so held in
trust are subject to the Trustee's rights under Section 7.07.
Section 8.03 Reinstatement. If the Trustee or Paying Agent is unable
to apply any money or U.S. Obligations in accordance with Section 8.01 by reason
of any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, then the Company's
obligations under this Indenture and the Securities shall be revived and
reinstated as though no deposit had occurred pursuant to this Article 8, until
such time as the Trustee or Paying Agent is permitted to apply all such money or
U.S. Government Obligations in accordance with Section 8.01; provided, however,
that if the Company makes any payment of Principal of or interest on any
Security following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Securities to receive such
payment from the money or U.S. Government Obligations held by the Trustee or
Paying Agent after payment in full to the Holders.
Section 8.04 Repayment to Company. The Trustee and Paying Agent
shall promptly turn over to the Company upon request any excess money or U.S.
Government Obligations held by them at any time. All money or U.S. Government
Obligations deposited with the Trustee pursuant to Section 8.01 (and held by it
or a Paying Agent) for the payment of Securities subsequently converted shall be
returned to the Company upon request.
The Trustee and the Paying Agent shall pay to the Company upon
request any money held by them for payment of Principal or interest that remains
unclaimed for two years after the right to such money has matured. After payment
to the Company, Securityholders entitled to the money shall look to the Company
for payment as unsecured general creditors unless an abandoned property law
designates another Person.
ARTICLE 9
Amendments
Section 9.01 Without Consent of Holders. The Company and the Trustee
may amend this Indenture or the Securities without the consent of any
Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Sections 5.01; or
(3) to make any change that does not adversely affect the rights of
any Securityholder.
Section 9.02 With Consent of Holders. The Company and the Trustee
may amend this Indenture or the Securities with the written consent of the
Holders of at least a majority in Principal amount of the Securities. However,
without the consent of each Securityholder affected, an amendment under this
Section may not:
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(1) reduce the amount of Securities whose Holders must consent to an
amendment;
(2) reduce the interest on or change the time for payment of
interest on any Security;
(3) reduce the Principal of or change the fixed maturity of any
Security;
(4) reduce the premium payable upon the redemption of any Security
or change the time at which any Security may or shall be redeemed;
(5) make any Security payable in money other than that stated in the
Security;
(6) make any change in Section 6.04, 6.07 or 9.02 (second sentence);
(7) make any change that adversely affects the right to convert any
Security; or
(8) make any change that adversely affects the preference or
priority of the Security.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such consent approves the substance thereof.
Section 9.03 Compliance with Trust Indenture Act and Section 12.03.
Every amendment to this Indenture or the Securities shall comply with the TIA as
then in effect, so long as the Indenture and Securities are subject to the TIA.
The Trustee is entitled to, and the Company shall provide an Opinion of Counsel
and Officers' Certificate that the Trustee's execution of any amendment or
supplemental indenture is permitted under this Article 9.
Section 9.04 Revocation and Effect of Consents and Waivers. A
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. However, any such
Holder or subsequent Holder may revoke the consent or Waiver as to such Holder's
Security or portion of the Security if the Trustee receives the notice of
revocation before the date the amendment or waiver becomes effective. After an
amendment or waiver becomes effective, it shall bind every Securityholder.
The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Securityholders entitled to give their
consent or take any other action described above or required or permitted to be
taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were
Securityholders at such record date (or their duly designated proxies), and only
those Persons, shall be entitled to give such consent or to revoke any consent
previously given or take any such action, whether or not such Persons continue
to be Holders after such record date. No such consent shall be valid or
effective for more than 120 days after such record date.
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Section 9.05 Notice of Amendment; Notation on or Exchange of
Securities. After any amendment under this Article becomes effective, the
Company shall mail to Securityholders a notice briefly describing such
amendment. The failure to give such notice to all Securityholders, or any defect
therein, shall not impair or affect the validity of an amendment under this
Article.
The Company or the Trustee may place an appropriate notation about
an amendment or waiver on any Security thereafter authenticated. The Company may
issue in exchange for affected Securities new Securities that reflect the
amendment or waiver.
Section 9.06 Trustee Protected. The Trustee need not sign any
supplemental indenture that adversely affects its rights.
ARTICLE 10
Conversion
Section 10.01 To be Supplemented. If a Security is to be convertible
into common shares or other securities of the Company, then the Company and the
Trustee may enter into a supplemental indenture setting forth the conversion
rights of the Holder of a Security.
ARTICLE 11
Subordination
Section 11.01 To be Supplemented. If a Security is to be
subordinated to other debt securities of the Company, then the Company and the
Trustee may enter into a supplemental indenture setting forth the provisions
governing such subordination.
ARTICLE 12
Miscellaneous
Section 12.01 Notices. Any notice by one party to the other shall be
in writing and sent to the other's address stated in Section 12.09. The notice
is duly given if it is delivered in Person or sent by a national courier service
which provides next Business Day delivery or by first-class mail.
A party by notice to the other party may designate additional or
different addresses for subsequent notices
Any notice sent to a Securityholder shall be mailed by first-class
letter mailed to its address shown on the register kept by the Registrar.
Failure to mail a notice to a Securityholder or any defect in a notice mailed to
a Securityholder shall not affect the sufficiency of the notice mailed to other
Securityholders.
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If a notice is delivered or mailed in the manner provided above
within the time prescribed, it is duty given, whether or not the addressee
receives it.
If the Company mails a notice to Securityholders, it shall deliver
or mail a copy to the Trustee and each Agent at the same time.
A "notice" includes any communication required by this Indenture.
Section 12.02 Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA ss. 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, and Registrar and anyone else shall have
the protection of TIA ss. 312(c).
Section 12.03 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
Section 12.04 Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:
(1) a statement that each Person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with.
Section 12.05 Rules by' Trustee and Agents. The Trustee may make
reasonable xxxxx for action by or a meeting of Securityholders. The Agent may
make reasonable rules and set reasonable requirements for its functions.
Section 12.06 Legal Holidays. A "Legal Holiday" is a Saturday, a
Sunday or a day on which banking institutions are not required to be open. If a
payment date is a Legal
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Holiday at a place of payment, payment may be made at that place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
Section 12.07 No Recourse Against Others. A director, officer,
employee or stockholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Securities or the indenture or for
any claim based on, in respect of or by reason of such obligations or their
creation.
Section 12.08 Duplicate Originals. The parties may sign any number
of copies, and may execute such in counterparts, of this Indenture. One signed
copy is enough to prove this Indenture.
Section 12.09 Variable Provisions. "Officer" means the President,
any Vice-President, the Treasurer, the Secretary, any Assistant Treasurer or any
Assistant Secretary of the Company.
The Company initially appoints the Trustee as Registrar, Paying
Agent and Conversion Agent.
The first certificate pursuant to Section 4.03 shall be for the
fiscal year ending on ____________, 20__.
The reporting date for Section 7.06 is ____________ of each year.
The first reporting date is __________________.
The Trustee shall always have a combined capital and surplus of at
least S as set forth in its most recent published annual report of condition.
The Trustee will be deemed to be in compliance with the capital and surplus
requirement set forth in the preceding sentence if its obligations are
guaranteed by a Person which could otherwise act as Trustee, hereunder and which
meets such capital and surplus requirement and the Trustee has at least the
minimum capital and surplus required by TIA ss. 310(a)(2).
In determining whether the Trustee has a conflicting interest as
defined in TIA ss. 310(b)(I), the following is excluded: Indenture dated as of
[______] , between the Company and [_____________], Trustee for the ___%
Debentures Due ___.
The Company's address is:
0000 Xxxxxxx 0
Xxxxxx, Xxxxxxx X0X 0X0
Xxxxxx
Facsimile No.: [_____________]
Attention: [_________________]
The Trustee's address is:
[Trustee's Name]
[Address]
Facsimile No.: [_____________]
Attention: [_________________]
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Section 12.10 Governing Law. The laws of the [State of
________________] shall govern this Indenture and the Securities.
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Dated: STAKE TECHNOLOGY LTD.
By: ____________________________________
Name:
Title:
Attest:
_______________________________
Name:
Title:
Dated: [_______________________________]
By: ____________________________________
Name:
Title:
Attest:
_______________________________
Name:
Title:
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EXHIBIT A
(Face of Security)
No. $ _____________
STAKE TECHNOLOGY LTD.
___% Debenture Due ________
Interest Payment Dates: _____________________
Record Dates: _____________________
Stake Technology Ltd. promises to pay to _________________, or registered
assigns, the sum of ________________________________ Dollars on _____________.
See the reverse and the Indenture referenced for additional
provisions of this Security.
Dated:
Authenticated:
[______________________] as Trustee STAKE TECHNOLOGY LTD.
By: __________________________ By: ____________________________________
Authorized Officer
By: ____________________________________
[SEAL]
A-1
(Back of Security)
STAKE TECHNOLOGY LTD.
_____ % Debenture Due ________
1. Interest. Stake Technology Ltd. ("Company"), a corporation
organized and existing under the laws of Canada, promises to pay interest on the
principal amount of this Security at the rate per annum shown above. The Company
will pay interest semiannually on ______________ and ____________ of each year.
Interest on Securities will accrue from the most recent date to which interest
has been paid or, if no interest has been paid, from _____________. Interest
will be computed on the basis of a 360-day year of twelve 30-day months.
2. Method of Payment. The Company will pay interest on the
Securities to the Persons who are registered holders of Securities at the close
of business on the record date for the next interest payment date, except as
otherwise provided herein or in the Indenture. Holders must surrender Securities
to a Paying Agent to collect principal payments. The Company will pay Principal
and interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, the Company may pay
Principal and interest by check payable in such money. It may mail an interest
check to a record date holder's registered address.
3. Bond Agents. Initially, [_____________] ("Trustee"), [address],
will act as Registrar, Paying Agent and Conversion Agent. The Company may change
any such Agent without notice. The Company or an Affiliate may act in any such
capacity. Subject to certain conditions, the Company may change the Trustee.
4. Indenture. The Company issued the Securities under an Indenture
dated as of [__________] ("Indenture") between the Company and the Trustee. The
terms of the Securities include those stated in the Indenture and those made
part of the Indenture by the Trust Indenture Act of 1939 (15 U.S. Code xx.xx.
00xxx-00xxxx) ("xxx Xxx"). The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the Act for a statement of
such terms. The Securities are unsecured general obligations of the Company
limited to $ _______ in aggregate principal amount.
5. Redemption. [The Securities may not be redeemed at the option of
the Company prior to (date).] The Company may redeem all the Securities at any
time or some of them from time to time [after (date)] at the following
redemption prices (expressed in percentages of principal amount), plus accrued
interest to the redemption date:
If redeemed during the 12-month period beginning
Year Percentage Year Percentage
---- ---------- ---- ----------
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6. Mandatory Redemption. The Company will redeem $ ________
principal amount of Securities on _____________ and on each _______________
thereafter through _______________ at a redemption price of 100% of principal
amount, plus accrued interest to the redemption date.
The Company may reduce the principal amount of Securities to be
redeemed pursuant to this paragraph by subtracting 100% of the principal amount
(excluding premium) of any Securities that have been previously cancelled, that
the Company has delivered to the Trustee for cancellation or that the Company
has redeemed other than pursuant to this paragraph. The Company may so subtract
the same Security only once.
7. Additional Optional Redemption. In addition to redemptions
pursuant to paragraph 6, the Company may redeem not more than $_______ principal
amount of Securities on ______________ and on each ______________ thereafter
through ______________ at a redemption price of 100% of principal amount, plus
accrued interest to the redemption date.
8. Notice of Redemption. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the redemption date to each
holder of Securities to be redeemed at his registered address.
9. Denominations, Transfer, Exchange. The Securities are in
registered form without coupons in denominations of $1,000 and whole multiples
of $1,000. The transfer of Securities may be registered and Securities may be
exchanged as provided in the indenture. The Registrar may require a holder,
among other things, to furnish appropriate endorsements and transfer documents
and to pay any taxes required by law. The Registrar need not exchange or
register the transfer of any Security or portion of a Security selected for
redemption. Also, it need not exchange or register the transfer of any
Securities for a period of 15 days before a selection of Securities to be
redeemed.
10. Persons Deemed Owner. Subject to Section 6.11, the registered
holder of a Security may be treated as its owner for all purposes.
11. Amendments and Waivers. Subject to certain exceptions, the
Indenture or the Securities may be amended, and any Default may be waived, with
the consent of the holders of a majority in Principal amount of the Securities.
Without the consent of any Securityholder, the Indenture or the Securities may
be amended to cure any ambiguity, defect or inconsistency, to provide for
assumption of Company obligations to Securityholders or to make any, change that
does not adversely affect the rights of any Securityholder.
12. Successor. When successors assume all the obligations of the
Company under the Securities and the Indenture, the Company will be released
from those obligations, except as provided in the Indenture.
13. Defeasance Prior to Redemption or Maturity. Subject to certain
conditions, the Company at any time may terminate some or all of its obligations
under the Securities and the Indenture if the Company deposits with the Trustee
money or U.S. Government Obligations for the payment of Principal and interest
on the Securities to redemption or maturity.
A-3
14. Defaults and Remedies. Subject to the Indenture, if an Event of
Default, as defined in the Indenture, occurs and is continuing, the Trustee or
the holders of at least 25% in Principal amount of the Securities may declare
all the Securities to be due and payable immediately. Securityholders may not
enforce the Indenture or the Securities except as provided in the Indenture. The
Trustee may require indemnity satisfactory to it before it enforces the
indenture or the Securities. Subject to certain limitations, holders of a
majority in Principal amount of the Securities may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Securityholders
notice of any continuing Default (except a Default in payment of Principal or
interest) if it determines that withholding notice is in their interests. The
Company must furnish an annual compliance certificate to the Trustee.
15. Trustee Dealings with Company. [_________________], the Trustee
under the Indenture, in its individual or any other capacity, may make loans to,
accept deposits from, and perform services for the Company or its Affiliates,
and may otherwise deal with the Company or its Affiliates, as if it were not
Trustee, subject to the indenture and the Act.
16. No Recourse Against Other. A director, officer, employee or
stockholder, as such, of the Company shall not have any liability for any
obligations of the Company under the Securities or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability. The waiver and release are part of the consideration for the
issue of the Securities.
17. Authentication. This Security shall not be valid until
authenticated by a manual signature of the Trustee.
18. Abbreviations. Customary abbreviations may be used in the name
of a Securityholder or an assignee, such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
The Company will furnish to any Securityholder upon written request
and without charge a copy of the Indenture. Requests may be made to: Stake
Technology Ltd., 0000 Xxxxxxx 0, Xxxxxx, Xxxxxxx, X0X 0X0, Xxxxxx.
A-4
