OH&S DRAFT
02/05/97
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Consumer Portfolio Services, Inc.
Issuer
and
Bankers Trust Company
Trustee
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INDENTURE
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Dated as of February 1, 1997
Debt Securities
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TABLE OF CONTENTS
Page
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RECITALS OF THE COMPANY
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions................................................... 1
Section 102. Compliance Certificates and Opinions.......................... 12
Section 103. Form of Documents Delivered to Trustee........................ 13
Section 104. Acts of holders............................................... 13
Section 105. Notices, Etc. to Trustee and Company.......................... 15
Section 106. Notice to Holders of Securities; Waiver....................... 15
Section 107. Language of Notices........................................... 16
Section 108. Conflict with Trust Indenture Act............................. 16
Section 109. Effect of Headings and Table of Contents...................... 16
Section 110. Successors and Assigns........................................ 16
Section 111. Separability Clause........................................... 16
Section 112. Benefits of Indenture......................................... 17
Section 113. Governing Law................................................. 17
Section 114. Legal Holidays................................................ 17
Section 115. No Recourse Against Others.................................... 17
ARTICLE TWO
SECURITIES FORMS
Section 201. Forms Generally............................................... 17
Section 202. Form of Trustee's Certificate of
Authentication................................................ 18
Section 203. Securities in Global Form..................................... 18
ARTICLE THREE
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series.......................... 19
Section 302. Currency; Denominations....................................... 21
Section 303. Execution, Authentication, Delivery and
Dating........................................................ 22
Section 304. Temporary Securities.......................................... 23
Section 305. Registration, Transfer and Exchange........................... 23
Section 306. Xxxxxxxxx, Xxxxxxxxx, Lost and Stolen
Securities.................................................... 26
Section 307. Payment of Interest and Certain Additional Amounts;
Rights to Interest and Certain
Additional Amounts Preserved.................................. 27
Section 308. Persons Deemed Owners......................................... 28
Section 309. Cancellation.................................................. 29
Section 310. Computation of Interest....................................... 29
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ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture....................... 29
Section 402. Satisfaction, Discharge and Defeasance of Securities
of Any Series................................................. 32
Section 403. Application of Trust Money.................................... 33
ARTICLE FIVE
REMEDIES
Section 501. Events of Default............................................. 34
Section 502. Acceleration of Maturity; Rescission and Annulment............ 36
Section 503. Collection of Indebtedness and Suits for Enforcement
by Trustee.................................................... 37
Section 504. Trustee May File Proofs of Claim.............................. 38
Section 505. Trustee May Enforce Claims without
Possession of Securities...................................... 39
Section 506. Application of Money Collected................................ 39
Section 507. Limitations on Suits.......................................... 40
Section 508. Unconditional Right of Holder to Receive
Principal and any Premium, Interest and
Additional Amounts............................................ 41
Section 509. Restoration of Rights and Remedies............................ 41
Section 510. Rights and Remedies Cumulative................................ 41
Section 511. Delay or Omission not Waiver.................................. 42
Section 512. Control by Holders of Securities.............................. 42
Section 513. Waiver of Past Defaults....................................... 43
Section 514. Waiver of Stay or Extension Laws.............................. 43
ARTICLE SIX
THE TRUSTEE
Section 601. Certain Duties and Responsibilities........................... 43
Section 602. Notice of Defaults............................................ 45
Section 603. Certain Rights of Trustee..................................... 45
Section 604. Not Responsible for Recitals or Issuance of Securities........ 47
Section 605. May Hold Securities........................................... 47
Section 606. Money Held in Trust........................................... 47
Section 607. Compensation and Indemnity.................................... 47
Section 608. Corporate Trustee Required; Eligibility....................... 48
Section 609. Resignation and Removal; Appointment of
Successor..................................................... 49
Section 610. Acceptance of Appointment by Successor........................ 50
Section 611. Merger, Conversion, Consolidation or
Succession to Business........................................ 52
Section 612. Appointment of Authenticating Agent........................... 52
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ARTICLE SEVEN
XXXXXX'S LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Company to Furnish Trustee Names and
Addresses of Holders.......................................... 54
Section 702. Preservation of Information; Communications
to Holders.................................................... 54
Section 703. Reports by Trustee............................................ 55
Section 704. Reports by Company............................................ 55
ARTICLE EIGHT
CONSOLIDATION, MERGER AND SALES
Section 801. Company May Consolidate, Etc., Only on
Certain Terms................................................. 56
Section 802. Successor Person Substituted for Company...................... 57
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 901. Without Consent Holders....................................... 58
Section 902. With Consent of Holders....................................... 59
Section 903. Execution of Amendments or Supplemental Indentures............ 60
Section 904. Effect of Waiver, Amendments and
Supplemental Indentures....................................... 61
Section 905. Reference in Securities too Supplemental Indentures........... 61
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal and any Premium,
Interest and Additional Amounts............................... 61
Section 1002. Maintenance of Office or Agency............................... 61
Section 1003. Money for Securities Payments to Be Held
in Trust...................................................... 62
Section 1004. Additional Amounts............................................ 63
Section 1005. Corporate Existence........................................... 64
Section 1006. Maintenance of Properties..................................... 65
Section 1007. Limitation on Restricted Payments............................. 65
Section 1008. Limitation on Indebtedness for Money
Borrowed...................................................... 66
Section 1009. Limitation on Subordinated Indebtedness....................... 66
Section 1010. Payment of Taxes and Other Claims............................. 66
Section 1011. Books and Records............................................. 67
Section 1012. Statement by Officers as to Default........................... 67
Section 1013. Waiver of Certain Covenants................................... 67
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Section 1014. Limitation on Ranking of Future
Indebtedness.................................................. 68
Section 1015. Subsidiaries that Own Finance Receivables..................... 68
Section 1016. Limitations on Transactions with
Affiliates.................................................... 68
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article...................................... 69
Section 1102. Election to Redeem; Notice to Trustee......................... 69
Section 1103. Selection by Trustee of Securities to be
Redeemed...................................................... 69
Section 1104. Notice of Redemption.......................................... 70
Section 1105. Deposit of Redemption Price................................... 71
Section 1106. Securities Payable on Redemption Date......................... 71
Section 1107. Securities Redeemed in Part................................... 72
ARTICLE TWELVE
SINKING FUNDS
Section 1201. Applicability of Article...................................... 72
Section 1202. Satisfaction of Sinking Fund Payments with Securities......... 72
Section 1203. Redemption of Securities for Sinking Fund..................... 73
ARTICLE THIRTEEN
REPAYMENT AT THE OPTION OF HOLDERS
Section 1301. Applicability of Article...................................... 74
Section 1302. Repayment Opinion upon Death of Holder........................ 74
Section 1303. Redemption Upon Special Redemption Event...................... 76
Section 1304. Deposit of Repayment Price.................................... 77
Section 1305. Securities Payable on Repayment Date.......................... 77
Section 1306. Securities Repaid in Part..................................... 78
ARTICLE FOURTEEN
SUBORDINATION OF SECURITIES
Section 1401. Securities Subordinated to Senior
Indebtedness.................................................. 78
Section 1402. Subrogation................................................... 82
Section 1403. Obligations of Company Unconditional.......................... 82
Section 1404. fectuation of Subordination by Trustee........................ 83
Section 1405. Knowledge of Trustee.......................................... 83
Section 1406. Trustee May Hold Senior Indebtedness.......................... 83
Section 1407. Rights of Holders of Senior Indebtedness
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Not Impaired.................................................. 83
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Consumer Portfolio Services, Inc.
Reconciliation and tie between Trust Indenture Act of 1939
and Indenture, dated as of February 1, 1997
Trust Indenture
Act Section Indenture Section
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Section 310 (a) (1)........................................................608
(a)(2).........................................................608
(a) (3) ............................................Not Applicable
(a) (4) ........................................ ...Not Applicable
(5) (5)........................................................608
(b)............................................................609
Section 311 ....................................................Not Applicable
Section 312 (a).......................................................701, 701
(b)............................................................702
(c)................................................ Not Applicable
Section 313 .......................................................602,703,704
Section 314 (a)............................................................704
(b).................................................Not Applicable
(c) (1)........................................................102
(c) (2)....................................................... 102
(c) (3).............................................Not Applicable
(d).................................................Not Applicable
(e)............................................................102
Section 315 (a)............................................................601
(b)............................................................602
(c)............................................................601
(d)............................................................601
(e).................................................Not Applicable
Section 316 (a).................................................Not Applicable
(a) (1) (A)...............................................502, 512
(a) (1) (B)....................................................513
(a) (2).............................................Not Applicable
(b)............................................................508
Section 317 (a) (1)........................................................503
(a) (2)........................................................504
(b)...........................................................1003
Section 318...............................................................108
Note: This reconciliation and tie shall not, for any purpose, be deemed to be
part of the Indenture.
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INDENTURE, dated as of February 1, 1997 (the "Indenture") between Consumer
Portfolio Services, Inc., a corporation duly organized and existing under the
laws of the State of California (hereinafter called the "Company"), having
executive offices located at 0 Xxx, Xxxxx 000, Xxxxxx, Xxxxxxxxxx 00000 and
Bankers Trust Company, a New York banking corporation duly organized and
existing under the laws of the State of new York (hereinafter called the
"Trustee"), having its Corporate Trust Office located at 0 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000.
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
subordinated debentures, notes or other evidences of indebtedness, unlimited as
to principal amount, to bear such rates of interest, to mature at such time or
times, to be issued in one or more series and to have such other provisions as
shall be fixed as hereinafter provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
This Indenture is subject to the provisions of the Trust Indenture Act and
the rules and regulations of the Securities and Exchange Commission promulgated
thereunder that are required to be part of this Indenture and, to the extent
applicable, shall be governed by such provisions,
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises, the sum of one dollar duly paid
by the Company to the Trustee, the receipt of which is hereby acknowledged and
the purchase of the Securities by the Holders (as defined) thereof, it is
mutually covenanted and agreed, for the equal and proportionate benefit of all
Holders from time to time of the Securities as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions.
Except as otherwise expressly provided in or pursuant to this Indenture or
unless the context otherwise requires, for all purposes of this Indenture:
(i) the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the singular;
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(ii) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(iii) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principals in the United States and, except as otherwise herein expressly
provided, the term "generally accepted accounting principals" with respect to
any computation required or permitted hereunder shall mean such accounting
principles as are generally accepted in the United States at the date of such
computation;
(iv) the word "herein", "hereof", "hereto" and "hereunder" and
other words of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision; and
(v) the word "or" is always used inclusively (for example, the
phrase "A" or "B" means "A or B or both", not "either A or B but not both").
Certain terms used, principally in certain Articles hereof are defined in
those Articles.
"Act", when used with respect to any Holder, has the meaning specified in
Section 104.
"Additional Amounts" means any additional amounts which are required hereby
or by any Security or by or pursuant to a Board Resolution, under circumstances
specified or other governmental charges imposed on Holders specified therein and
which are owing to such Holders.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have the meanings correlative to
the foregoing.
"Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 612 to act on behalf of the Trustee to authenticate Securities of one
or more series.
"Board of Directors" means the board of directors of the Company or any
committee of that board duly authorized to act generally or in any particular
respect for the Company hereunder.
"Board Resolution" means a copy of one or more resolutions, certified by
the Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and
2
to be in full force and effect on the date of such certification, delivered to
the Trustee.
"Business Day", except as may otherwise be provided in the form of
Securities of any particular series pursuant to the provisions of this
Indenture, with respect to any Place of Payment or other location, means each
Monday, Tuesday, Wednesday, Thursday and Friday that is not a Legal Holiday in
the state where the Trustee's Corporate Trust Office is principally located in
such Place of Payment or other location.
"Capitalized Lease Obligations" means, as to any Person, the obligations of
such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) real or personal property which obligations are
required to be classified and accounted for as capital lease obligations on a
balance sheet of such Person under generally accepted accounting principles and,
for purposes of this Indenture, the amount of such obligations at any date shall
be the capitalized amount thereof at such date, determined in accordance with
generally accepted accounting principles.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Securities Exchange Act of 1934, as amended,
or, if at any time after the execution of this Indenture such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Company" means the Person named as the "Company" in the first paragraph of
this Indenture until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person, and any other obligor upon the Securities.
"Company Request" and "Company Order" mean, respectively, a written request
or order, as the case may be, signed in the name of the Company by the Chairman
of the Board, a Vice Chairman of the Board, the Chief Executive Officer, the
President, a Vice President, the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary, of the Company, or by another officer of
the Company duly authorized to sign by a Board Resolution, and delivered to the
Trustee.
"Consolidated Net Income" means the amount of net income (loss) of the
Company and its Subsidiaries determined in accordance with generally accepted
accounting principles; provided, however, that there shall not be included in
Consolidated Net Income any net income (loss) of any Person acquired or disposed
of in a pooling of interests transaction for any period prior to the acquisition
thereof or subsequent to the disposition thereof.
"Consolidated Net Worth" means the excess, as determined in accordance with
generally accepted accounting principles, after
3
making appropriate deductions for any minority interest in the net worth of
Subsidiaries, of (i) the assets of the Company and its Subsidiaries over (ii)
the liabilities of the Company and its Subsidiaries; provided, however, that any
write-up in the book value of any assets owned subsequent to the date of this
Indenture, other than as required for and at the time of assets acquired in
connection with the purchase of a Person or business, shall not be taken into
account.
"Corporation" includes corporations, associations, companies and business
trusts.
"Corporate Trust Office" means the principal office of the Trustee at which
at any particular time its corporate trust business shall be administered, which
office at the date of original execution of this Indenture is located at 0
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Corporate Trust Operations Center" means the office of the Trustee at
which at any particular time Securities shall be presented for transfer or
payment, which office at the date of the original execution of this Indenture is
located at _____, _______________________, _______________________.
"Defaulted Interest" has the meaning specified in Section 307.
"Depository" means, with respect to any Security issuable or issued in the
form of one or more global Securities, the Person designated as Depository by
the Company in or pursuant to this Indenture, which Person must be, to the
extent required by applicable law or regulation, a clearing agency registered
under the Securities Exchange Act of 1934, as amended, and if so provided with
respect to any Security, any successor to such Person. If at any time there
is more than one such Person, "Depository" shall mean, with respect to any
Securities, the qualifying entity which has been appointed with respect to such
Securities.
"Event of Default" has the meaning specified in Section 501.
"Government Obligations" means direct obligations of the United States of
America, or any Person controlled or supervised by and acting as an agency or
instrumentality of such government, in each case where the payment, or payments
thereunder are unconditionally guaranteed as a full faith and credit obligation
by such government and which are not callable or redeemable at the option of the
issuer or issuers thereof, and shall also include a depository receipt issued by
a bank or trust company as custodian with respect to any such Government
Obligation or a specific payment of interest on or principal of or other amount
with respect to any such Government Obligation held by such custodian for the
account of the holder of a, depository receipt, provided that (except as
required by law) such custodian is not authorized to make any deduction from the
amount payable to the
4
holder of such depository receipt from any amount received by the custodian in
respect of the Government Obligation or the specific payment of interest on or
principal of or other amount with respect to the Government Obligation evidenced
by such depository receipt.
"Holder", when used with respect to any Security, means the Person in whose
name such Security is registered in the Security Register.
"Indebtedness for Money Borrowed" means any of the following obligations of
the Company or any Subsidiary which by its terms matures at or is extendable or
renewable at the sole option of the obligor without requiring the consent of the
obligee to a date more than twelve months after the date of the creation or
incurrence of such obligation: (i) any obligations, contingent or otherwise, for
borrowed money or for the deferred purchase price of property, assets,
securities, or services (including, without limitation, any interest accruing
subsequent to an Event of Default) , (ii) all obligations (including the
Securities) evidenced by bonds, notes, debentures, letters of credit , or other
similar instruments, (iii) all indebtedness created or rising under any
conditional sale or other title retention agreement with respect to property
acquired (even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property) except any such obligation that constitutes a trade payable and an
accrued liability arising in the ordinary course of business, if and to the
extent any of the foregoing indebtedness would appear as a liability upon a
balance sheet prepared in accordance with generally accepted accounting
principles, (iv) all Capitalized Lease Obligations, (v) all indebtedness of the
type referred to in Clause (i), (ii), (iii) or (iv) above secured by (or for
which the holder of such indebtedness has an existing right, contingent or
otherwise, to be secured by) any lien upon or in property of the Company
(including, without limitation, accounts and contract rights), even though the
Company has not assumed or become liable for the payment of such indebtedness,
and (vi) any guaranty or endorsement (other than for collection or deposit in
the ordinary course of business) or discount with recourse of, or other
agreement, contingent or otherwise, to purchase, repurchase, or otherwise
acquire, to supply, or advance funds or become liable with respect to, any
indebtedness or any obligation of the type referred to in any of the foregoing
clauses (i) through (v), regardless of whether such obligation would appear on a
balance sheet; provided, however, that Indebtedness for Money Borrowed shall not
include (x) Interest Rate Swap Obligations with respect to any obligations
included in the foregoing clauses (i) through (vi) or any guarantees of any such
Interest Rate Swap Obligations or (y) amounts due under or represented by
asset-backed securities or other interest-bearing certificates issued by trusts
formed by Subsidiaries in connection with the securitization of automobile
installment sale contracts or other receivables.
5
"Indenture" means this instrument as it may from time to time be
supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof and, with respect to any
Security by the terms and provisions of such Security established pursuant to
Section 301 (as such terms and provisions may be amended pursuant to the
applicable provisions hereof).
"Independent Public Accountants" mean a nationally recognized firm of
accountants that, with respect to the Company and any other obligor under the
Securities, are independent public accountants within the meaning of the
Securities Act of 1933, as amended, and the rules and regulations promulgated by
the Commission thereunder, who may be the independent public accountants
regularly retained by the Company or who may be other independent public
accountants. Such accountants or firm shall be entitled to rely upon any
Opinion of Counsel as to the interpretation of any legal matters relating to
this Indenture or certificates required to be provided hereunder.
"Interest" with respect to any original Issue Discount Security which by
its terms bears interest only upon maturity, means interest payable upon,
Maturity and, when used with respect to a Security which provides for the
payment of Additional Amounts pursuant to Section 1004, includes such Additional
Amounts.
"Interest Payment Date", with respect to any Security, means the Stated
Maturity of an instalment of interest on such Security.
"Interest Rate Swap Obligations" means the obligation of the Company or any
Subsidiary pursuant to any interest rate swap agreement, interest rate collar
agreement, forward rate agreement, interest rate cap insurance, option or
futures contract or other similar agreement or arrangement, and any renewal or
extension thereof, designed to protect the Company or any of its Subsidiaries
against interest rate risk.
"Legal Holiday", with respect to any Place of Payment or other location,
means a Saturday, a Sunday or a day on which banking institutions or trust
companies in such Place of Payment or other location are not authorized or
obligated to be open.
"Maturity", with respect to any Security, means the date on which the
principal of such Security or an installment of principal becomes due and
payable as provided in or pursuant to this Indenture, whether at the Stated
Maturity or by declaration of acceleration, notice of redemption, notice of
option to elect repayment or otherwise, and includes the Redemption Date.
"Money", with respect to any payment, deposit or other transfer pursuant to
or contemplated by the terms hereof, means United States dollars or other
equivalent unit of legal tender
6
for payment of public or private debts in the United States of America.
"1995 Indenture" means that Indenture dated as of December 15, 1995 between
the Company and Xxxxxx Trust and Savings Bank, as Trustee as such Indenture
exists on the date of execution of this Indenture.
"Office or Agency", with respect to any Securities, means an office or
agency of the Company maintained or designated in a Place of Payment for such
Securities pursuant to Section 1002 or any other office or agency of the Company
maintained or designated for such Securities pursuant to Section 1002 or, to the
extent designated or required by Section 1002 in lieu of such office or agency,
the Corporate Trust Operations Center of the Trustee.
"Officer" means the Chairman of the Board, a Vice Chairman of the Board,
the President, any Vice President, the Chief Financial Officer, the Chief
Executive Officer, the Chief Operating Officer, the Treasurer, and the
Secretary, or the Controller of the Company.
"Officers' Certificate" means a certificate signed by two Officers or by an
Officer and an Assistant Treasurer or an Assistant Secretary of the Company that
complies with the requirements of Section 314(e) )f the Trust Indenture Act.
"Opinion of Counsel" means a written opinion of counsel, who may be an
employee of or counsel for the Company or other counsel who shall be reasonably
acceptable to the Trustee, that complies with the requirements of ion 314(e) of
the Trust Indenture Act.
"Original Issue Discount Security" means a Security issued pursuant to this
Indenture which provides for declaration of an amount less than the principal
face amount thereof to be due and payable upon acceleration thereof pursuant to
Section 502.
"Outstanding", when used with respect to any Securities, means, as of the
date of determination, all such Securities theretofore authenticated and
delivered under this Indenture, except:
(i) any such Security theretofore canceled by the Trustee or the
Security Registrar or delivered to the Trustee or the Security Registrar for
cancellation;
(ii) any such Security or portions thereof for whose payment at
the Maturity thereof Money in the necessary amount has been theretofore
deposited pursuant hereto with the Trustee or any Paying Agent (other than the
Company) in trust or set aside and segregated in trust by the Company (if the
Company shall act as its own Paying Agent) for the Holders of such Securities,
provided that, if such Securities are to be redeemed, notice of such redemption
has been duly given pursuant to this
7
Indenture provision therefor satisfactory to the Trustee has been made;
(iii) any such Security with respect to which the Company has
effected defeasance pursuant to Section 401 or 402; and
(iv) any such Security which has been paid pursuant to Section
306 or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, unless there shall have
been presented to the Trustee proof satisfactory to it that such Security is
held by a bona fide purchaser in whose hands such Security is a valid obligation
of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization direction, notice, consent or waiver hereunder, (i) the principal
amount of an Original Issue Discount Security that may be counted in making such
determination and that shall be deemed to he Outstanding for such purposes shall
be equal to the amount of the principal thereof that pursuant to the terms of
such Original Issue Discount Security would be declared (or shall have been
declared to be) due and payable upon a declaration of acceleration thereof
pursuant to Section 502 at the time of such determination, and (ii) Securities
owned by the Company or any other obligor of the Securities or any Affiliate of
the Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in making any such determination or relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which the
Trustee knows to be so owned shall be so disregarded. Securities so owned which
shall have been pledged in good faith may be regarded as outstanding if the
pledgee establishes to the satisfaction of the Trustee (A) the pledgee's right
so to act with respect to such Securities and (B) that the pledgee is not the
Company or any other obligor upon the Securities or any Subsidiary or any
Affiliate of the Company or such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of, or any premium or interest on, or any Additional Amounts with
respect to any Security on behalf of the, Company.
"Person" means any individual, corporation, association, company, business
trust, partnership, joint venture, joint-stock company, trust, estate,
unincorporated organization or government or any agency or political subdivision
thereof.
"Place of Payment", with respect to any Security, means the place or places
where the principal of, or any premium or interest on, or any Additional Amounts
with respect to such Security is payable as provided in or pursuant to this
Indenture.
8
"Predecessor Security" of any particular Security means every previous
Security evidencing all, or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for in lieu of a lost,
destroyed, mutilated or stolen Security shall be deemed to evidence the same
debt as the lost, destroyed, mutilated or stolen Security.
"Redemption Date", with respect to any Security or portion thereof to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Date" with respect to any Security or portion thereof to be
redeemed, means the price at which it is to be redeemed as determined by or
pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Security on any
Interest Payment Date therefor means the date, if any, specified in or pursuant
to this Indenture as the "Regular Record Date".
"Repayment Date", with respect to any Security or portion thereof to be
repaid pursuant to Article Thirteen, means the date fixed for such repayment by
or pursuant to this Indenture.
"Repayment Price", with respect to any Security or portion thereof to be
repaid pursuant to Article Thirteen, means the price at which it is to be repaid
pursuant to this Indenture. In the case of repayment pursuant to Section 1302
or 1303, the Repayment Price shall not include any premium on such Security.
"Responsible Officer" means any officer of the Trustee in its Corporate
Trust Office and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"Restricted Payment" has the meaning specified in Section 1007.
"Security or "Securities" means any security or securities, as the case may
be authenticated and delivered under this Indenture; provided, however, that, if
at any time there is more than one Person acting as Trustee under this
Indenture, "Securities", with respect to any such Person, shall mean Securities
authenticated and delivered under this Indenture, exclusive, however, of
Securities of any series as to which such Person is not Trustee.
"Security Register and "Security Registrar" have the respective meanings
specified in Section 305.
"Senior Indebtedness" means the principal amount of, premium, if any, and
interest on (i) any Indebtedness for Money
9
Borrowed, whether now outstanding or hereafter created, incurred, assumed or
guaranteed, unless in the instrument creating or evidencing such Indebtedness
for Money Borrowed or pursuant to which such Indebtedness for Money Borrowed is
outstanding it is provided that such Indebtedness for Money Borrowed is
subordinate in right of payment or in rights upon liquidation to any other
Indebtedness for Borrowed Money of the Company and (ii) refundings, renewals,
extensions, modifications, restatements, and increases of any such indebtedness.
"Significant Subsidiary" means any Subsidiary which accounted for more than
10% of the Company's Consolidated Net Worth or more than 10% of the Company's
consolidated revenue, in each case as of the end of the Company's most recent
fiscal year.
"Special Record Date" for the payment of any Defaulted Interest on any
Security means a date fixed by the Trustee pursuant to Section 307.
"Special Redemption Event" means the occurrence of any one or more of the
following (i)(x) the Company shall consolidated with or merge into any other
Person, (y) the Company shall convey, transfer or lease all or substantially all
of its assets to any Person or (z) any Person shall consolidate with or merge
into the Company pursuant to a transaction in which the outstanding common stock
of the Company is reclassified, changed or exchanged; provided that the
following shall be excluded from the operation of this clause (i): a transaction
which is part of a sale, financing or securitization of receivables, entered
into in the ordinary course of business; a transaction between the Company and
one or more of its wholly-owned Subsidiaries; or a transaction of the type
described in clause (i) (x) or (i) (z) above unless immediately after giving
effect to such transaction, a Person or "group" (as such term is used for
purposes of Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended) other than any Person who is a director of the Company or a "related
Person" on the date of this Indenture, is or becomes the "beneficial owner",
directly or indirectly, of more than fifty percent (50%) of the total voting
power in the aggregate normally entitled to vote in the election of directors;
and (ii) any Person or "group" (as such term is used for purposes of Section
13(d) or 14(d) of the Securities Exchange Act of 1934, as amended) other than
any Person who is a director of the Company or a "related Person" on the date of
this Indenture, shall purchase or otherwise acquired in one or more transactions
or series of transactions beneficial ownership of fifty percent (50%) or more of
the outstanding common stock of the Company on the date immediately prior to the
last such purchase or other acquisition. For purposes of this definition,
"related Person" means, in addition to such director, (a) any relative or spouse
of such director, or any relative of such spouse, (b) any trust or estate in
which such Person or any of the Persons specified in clause (a) collectively own
fifty percent (50%) or more of the total beneficial interest or (c) any
corporation or other organization (other than the Company) in which such
director or
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any of the Persons specified in clause (a) or (b) are the beneficial owners
collectively of fifty percent (50%) or more of the voting power.
"Stated Maturity", with respect to any Security or any installment of
principal thereof or interest thereon or any Additional Amounts with respect
thereto, means the date established by or pursuant to this Indenture as the
fixed date on which the principal of such Security or such installment of
principal or interest is or such Additional Amounts are due and payable.
"Subordinated Indebtedness" means Indebtedness for Borrowed Money that is
not Senior Indebtedness.
"Subsidiary" means any corporation of which at the time of determination
the Company or one or more Subsidiaries owns or controls directly or indirectly
more than 50% of the shares of Voting Stock.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended,
and any reference herein to the Trust Indenture Act or a particular provision
thereof shall mean such Act or provision, as the case may be, as amended or
replaced from time to time or as supplemented from time to time by rules or
regulations adopted by the Commission under or in furtherance of the purposes of
such Act or provision, as the case may be.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument, until a successor Trustee shall have become such with respect
to one or more series of Securities pursuant to the applicable provisions of
this Indenture, and thereafter "Trustee" shall mean each Person who is then a
Trustee hereunder; provided, however, that if at any time there is more than one
such Person, "Trustee" shall mean each such Person and as used with respect to
the Securities of any series shall mean the Trustee with respect to the
Securities of such series.
"United States", except as otherwise provided herein or in any Security,
means the United States of America (including the states thereof and the
District of Columbia), its territories and possessions and other areas subject
to its jurisdiction.
"United States Alien", except as otherwise provided in or pursuant to this
Indenture, means any Person who, for United States Federal income tax purposed,
is a foreign corporation, a nonresident alien individual, a non-resident alien
fiduciary of a foreign estate or trust, or a foreign partnership one or more of
the members of which is, for United States Federal Income tax purposes, a
foreign corporation, a non-resident alien individual or a non-resident alien
fiduciary of a foreign estate or trust.
"Vice President", when used with respect to the Company, means any Senior
or Executive Vice President, whether or not
11
designated by a number or a word or words added before or after the title "Vice
President".
"Voting Stock" means stock of a corporation of the class or classes having
general voting power under ordinary circumstances to elect at least a majority
of the board of directors, managers, or trustees of such corporation, provided
that, for the purposes hereof, stock which carries only the right to vote
conditionally on the happening of an event shall not be considered Voting Stock
whether or not such event shall have happened.
"Warehouse Indebtedness" means the warehouse line of credit which the
Company has in place on the date of this Indenture and any replacement or
additional facility under which the Company borrows money against contracts held
for sale, pending their sale in securitization transactions.
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee at the request of the Trustee (a) an Officers' Certificate stating that
all conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with and (b) an opinion of Counsel stating
that, in the opinion of such counsel, all such conditions precedent, if any,
have been complied with, except that in the case of any such application or
request as to which the furnishing of such documents or any of them is
specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or Opinion of Counsel with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(i) a statement that each individual signing such certificate or
rendering such Opinion of Counsel has read such condition or covenant and the
definitions herein relating thereto;
(ii) 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 Opinions of Counsel are based;
(iii) a statement that, in the opinion of each such Person, he has
made such examination or investigation as in necessary to enable him to express
an informed opinion as to whether or not such condition or covenant has been
complied with; and
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(iv) a statement as to whether or not, in the opinion of each
such Person, such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of Counsel, of, any specified Person, it is not necessary
that all such matters be certified by, or covered by the Opinion of Counsel of,
only one such Person, or that they be so certified or covered by only one
document, but one such Person may certify or give an Opinion of Counsel with
respect to some matters and one or more other such Persons as to other matters,
and any such Person may certify or give an opinion as to such matters in one or
several documents.
Any Officer's Certificate may be based, insofar as it relates to legal
matters, upon a Certificate or opinion of, or representations by, counsel. Any
such Opinion of Counsel or representation of counsel may be based, insofar as it
relates to factual matters, upon a certificate or opinion of, or representations
by, an Officer or Officers of the Company.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instrument under this Indenture or any Security, they may, but need not, be
consolidated and form one instrument.
Section 104. Acts of holders.
(i) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by or pursuant to this Indenture o be given
or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person
or by an agent duly appointed in writing. Except as herein otherwise
expressly provided, such action shall become effective when such instrument
or instruments are received by the Trustee and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent, or of the holding by any Person of a Security,
shall be sufficient for any purpose of this Indenture and (subject to
Section 315 of the Trust Indenture Act) conclusive in favor of the Trustee
and the Company and any agent of the Trustee or the Company, if made in the
manner provided in this Section.
Without limiting the generality of this Section, unless otherwise
provided in or pursuant to this Indenture, a Holder, including a Depository
that is a Holder of a global
13
Security, may make, give or, take, by a proxy, or proxies, duly appointed
in writing, any, request, demand, authorization, direction, notice consent,
waiver or other action provided in or pursuant to this Indenture to be
made, given or taken by Holders, and a Depository that is a Holder of a
global Security may provide its proxy or proxies to the beneficial owners
of interests in any such global Security through such Depository's standing
instructions and customary practices.
The Trustee shall fix a record date for the purpose of determining the
Persons who are beneficial owners of interest in any permanent global
Security held by a Depository entitled under the procedures of such
Depository to make, give or take, by a proxy or proxies duly appointed in
writing, any request, demand, authorization, direction, notice, consent,
waiver or other action provided in or pursuant to this Indenture to be
made, give or taken by Holders. If such a record date is fixed, the
Holders on such record date or their duly appointed proxy or proxies, and
only such Persons, shall be entitled to make, give or take such request,
demand, authorization, direction, notice, consent, waiver or other action,
whether or not such Holders remain Holders after such record date. Not
such request, demand, authorization, direction, notice, consent, waiver or
other action shall be valid or effective if made, given or taken more than
90 days after such record date.
(ii) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any reasonable manner which the
Trustee deems sufficient and in accordance with such reasonable unless as
the Trustee may determine; and the Trustee may in any instance require
further proof with respect to any of the matters referred to in this
Section.
(iii) The ownership, principal amount and serial numbers of
Securities held by any Person, and the date of the commencement and the
date of the termination of holding the same, shall be provided in the
Security Register.
(iv) If the Company shall solicit from the Holders of any
Securities any request, demand, authorization, direction, notice, consent,
waiver or other Act, the Company may at its option (but is not obligated
to), by Board Resolution, fix in advance a record date for the
determination of Holders of Securities entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other Act. If
such a record date if fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act may be given before or
after such record date, but only the Holders of Securities of record at the
close of business on such record date shall he deemed to be Holders for the
purpose of determining whether Holders of the requisite proportion of
Outstanding Securities have
14
authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other Act, and for that purpose the
Outstanding Securities shall be computed as of such record date; provided
that no such authorization, agreement or consent by the Holders of
Securities on such record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later
than six months after the record date.
(v) Any request, demand, authorization, direction, notice,
consent, waiver or other Act by the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued
upon the registration of transfer thereof or in exchange therefor or in
lieu thereof in respect of anything done or suffered to be done by the
Trustee, any Security Registrar, any Paying Agent or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
Section 105. Notices, Etc. to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of Holders or other document provided or permitted by this Indenture
to be made upon, given or furnished to, or filed with:
(i) the Trustee by any Holder or the Company shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust Office, or
(ii) the Company by the Trustee or any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company addressed
to the attention of its Chief Financial Officer at the address of its
principal office specified in the first paragraph of this instrument or at
any other address previously furnished in writing to the Trustee by the
Company.
Section 106. Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided in or pursuant to this Indenture or
in the form of Securities of any particular series issued pursuant to the
provisions of this Indenture, where this Indenture provides for notice of
Holders of Securities of any event, such notice shall be sufficiently given to
Holders of Securities if in writing and mailed, first-class postage prepaid, to
each Holder of a Security affected by such event, at his address as it appears
in the Security Register, not later than the latest date (if any), and not
earlier than the earliest date (if any), prescribed for the giving of such
notice.
15
In any case where notice to Holders of Securities is given by mail, neither
the failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder of a Security shall affect the sufficiency of such notice with
respect to other Holders of Securities. Any notice which is mailed in the
manner herein provided shall be conclusively presumed to have been duly given or
provided. In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
Where this Indenture provides for notice of any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders of Securities shall be filed with the Trustee, but
such filing shall not be a condition, precedent to the validity of any action
taken in reliance upon such waiver.
Section 107. Language of Notices.
Any request, demand, authorization, direction, notice, consent, election or
waiver required or permitted under this Indenture shall be in the English
language.
Section 108. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with any duties
under any required provision of the Trust Indenture Act imposed hereon by
Section 338(d) thereof, such required provision shall control. If any provision
of this Indenture modifies or excludes any provision of the Trust Indenture Act
that may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
Section 109. Effect of Headings and Table of Contents.
The Article and Section Headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 110. Successors and Assigns.
All covenants and agreements in this Indenture by the Company and the
Trustee shall bind their respective successors and assigns, whether so expressed
or not.
Section 111. Separability Clause.
In case any provision in this Indenture or any Security shall be invalid,
illegal or unenforceable, either wholly or partially, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired
16
thereby, and such provisions shall be given effect to the fullest extent
permitted by law.
Section 112. Benefits of Indenture.
Nothing in this Indenture or any Security, express or implied, shall give
to any Person, other than the parties hereto, any Security Registrar, any Paying
Agent, any Authenticating Agent and their respective successors hereunder and
the Holders of Securities, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
Section 113. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with the internal laws of the State of New York applicable to
agreements made or instruments entered into and, in each case, performed in said
state.
Section 114. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date, Repayment
Date or Stated Maturity of any Security shall be a Legal Holiday at any Place of
Payment, then (notwithstanding any other provision of this Indenture or any
Security other than a provision in any Security that specifically states that
such provision shall apply in lieu of this Section) payment need not be made at
such Place of Payment on such date, but may be made on the next succeeding day
that is a Business Day at such Place of Payment with the same force and effect
as if made on the Interest Payment Date, Redemption Date, Repayment Date or at
the Stated Maturity, and no interest shall accrue on the amount payable on such
date or at such time for the period from and after such Interest Payment Date,
Redemption Date, Repayment Date or Stated Maturity, as the case may be.
Section 115. No Recourse Against Others.
No past, present or future director, officer, employee, incorporator or
stockholder of the Company, as such, shall have any liability for any
obligations be the Company under the Securities or this Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for issuance of
the Securities.
ARTICLE TWO
SECURITIES FORMS
Section 201. Forms Generally.
17
Each Security and global Security issued pursuant to this Indenture shall
be in the form established by or pursuant to a Board Resolution in accordance
with Section 301 or in one or more indentures supplemental hereto shall have
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by or, pursuant to this Indenture or any indenture
supplemental hereto and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with any law or with any rule or regulation of any stock
exchange or as may, consistently herewith, be determined by the officers
executing such Security as evidenced by their execution of such Security.
Unless otherwise provided in or pursuant to this Indenture, the Securities
shall be issuable in global and registered form without coupons.
Definitive Securities shall be printed, lithographed or engraved or
produced by any combination of these methods on a steel engraved border or steel
engraved, borders or may be produced in any other manner, all as determined by
the Officers of the Company executing such Securities, as evidenced by their
execution of such Securities.
Section 202. Form of Trustee's Certificate of Authentication.
Subject to Section 612, the Trustee's certificate of authentication shall
be in substantially the following form:
"This is one of the Securities of the series designated herein referred to
in the within-mentioned Indenture.
------------------------------
as Trustee
By
---------------------------
Authorized Signatory
Section 203. Securities in Global Form.
If Securities of a series are issuable in global form (i.e., in the name of
the name of the nominee of a Depository for purposes of book-entry transfer),
any such Security may provide that it or any number of such Securities shall
represent the aggregate amount of all Outstanding Securities or such series (or
such lesser amount as is permitted by the terms thereto from time to time
endorsed thereon and may also provide that the aggregate amount of Outstanding
Securities represented thereby may from time to time be increased or reduced to
reflect exchanges. Any endorsement of any Security in global form to reflect
the amount, or any increase or decrease in the amount, or changes in the rights
of Holders, of Outstanding Securities represented thereby shall be made in such
manner and by such Person or Persons as shall be specified therein
18
or in the Company Order to be delivered pursuant to Section 303 or 304 with
respect thereto. Subject to the provisions of Section 303 and, if applicable,
Section 304, the Trustee shall deliver and redeliver any Security in permanent
global form in the manner and upon instructions given by the Person or Persons
specified therein or in the applicable Company Order. If a Company Order
pursuant to Section 303 or 304 has been, or simultaneously is, delivered, any
instructions by the Company with respect to a Security in global form shall be
in writing but need not be accompanied by or contained in an Officers
Certificate and need not be accompanied by an Opinion of Counsel.
ARTICLE THREE
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited. The Securities may be issued in
one or more series.
With respect to any Securities to be authenticated and delivered hereunder,
there shall be established in or pursuant to a Board Resolution and set forth,
or determined in the manner provided, in an Officers Certificate, or established
in one or more indentures supplemental hereto,
(1) the title of such Securities and the series in which such
Securities shall be included;
(2) any limit upon the aggregate principal amount of the
Securities of such title or the Securities of such series which may be
authenticated and delivered under this Indenture (except for Securities
authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Securities of the same series pursuant
to Section 304, 305, 306, 905 or 1107 or the terms of such Securities);
(3) if any of such Securities are to be issuable in global form,
when any of such Securities are to be issuable in global form and (i)
whether beneficial owners of interests in any such global Security may
exchange such interest for Securities of the same series and of like tenor
and of any authorized form and denomination, and the circumstances under
which any such exchanges may occur, if other than in the manner specified
in Section 305, and (ii) the name of the Depository with respect to any
global Security;
(4) the date or dates, or the method or methods, if any, by
which such date or dates shall be determined, on which the principal of
such Securities is payable;
19
(5) the rate or rates at which such Securities shall bear
interest, if any, or the method or methods, if any, by which such rate or
rates are to be determined, the date or dates, if any, from which such
interest shall accrue or the method or methods, if any, by which such date
or dates are to be determined, the Interest Payment Dates, if any, on which
such interest shall be payable and the Regular Record Date, if any, for the
interest payable on Securities on any Interest Payment Date, whether and
under what circumstances Additional Amounts on such Securities or any of
them shall be payable and, if payable, whether the Company has the option
to redeem the affected Securities rather than pay such Additional Amounts,
and the basis upon which interest shall be calculated if other than that of
a 360-day year of twelve 30-day months; and if any of such Securities are
convertible in whole or in part into common stock of the Company, the terms
and conditions under which such conversion may occur;
(6) if in addition to or other than the City of New York, New
York, the place or places where the principal of, any premium and interest
on or any Additional Amounts with respect to such Securities shall be
payable, any of such Securities may be surrendered for registration of
transfer, any of such Securities may be surrendered for exchange and
notices or demands to or upon the Company in respect of such Securities and
this Indenture may be served;
(7) whether any of such Securities are to be redeemable at the
option of the Company and, if so, the period or periods within which, the
price or prices at which and the other terms and conditions (in addition to
those set forth in Article Eleven) upon which such Securities may be
redeemed, in whole or in part, at the option of the Company;
(8) whether the Company is obligated to redeem or purchase any
of such Securities pursuant to any sinking fund or at the option of any
Holder thereof and, if so, the period or periods within which, the price or
prices at which and the other terms and conditions upon which such
Securities shall be redeemed or purchased (in addition to those set forth
in Article Twelve), in whole or in part, pursuant to such obligation,
whether the Company's obligation to redeem or purchase Securities for a
sinking fund may be satisfied pursuant to Section 1202 and any provisions
for the remarketing of such Securities so redeemed or purchased;
(9) the denominations in which any of such Securities shall be
issuable if other than denominations of $1,000 and any integral multiple
thereof;
(10) if other than the principal amount thereof, the portion of
the principal amount of any of such Securities that shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 502
or the method by which such portion is to be determined;
20
(11) any deletions from, modifications of or additions to the
Events of Default or covenants of the Company with respect to any of such
Securities, whether or not such Events of Default or covenants are
consistent with the Events of Default or covenants set forth herein;
(12) the applicability, if any, of Section 402 to any of such
Securities and any provisions in modification of, in addition to or in lieu
of any of the provisions of Section 402;
(13) whether any of such Securities are to be issuable upon the
exercise of warrants, as well as the time, manner and place for such
Securities to be authenticated and delivered;
(14) if any of such Securities are to be issuable in global form
and are to be issuable in definitive form (whether upon original issue or
upon exchange of a temporary Security) only upon receipt of certain
certificates or other documents or satisfaction of other Conditions, then
the form and terms of such certificates, documents or conditions;
(15) if there is more than one Trustee, the identity of the
Trustee and, if not the Trustee, the identity of each Security Registrar,
Paying Agent or Authenticating Agent with respect to such Securities; and
(16) any other terms of such Securities (which terms shall not be
inconsistent with the terms of this Indenture).
All Securities of any one series shall be substantially identical except as
to denomination and the rate or rates of interest, if any, and Stated Maturity,
the date from which interest, if any, shall accrue and except as may otherwise
be provided by the Company in or pursuant to the Board Resolution and set forth,
or determined in the manner provided, in the Officers' Certificate or in any
indenture or indentures supplemental hereto pertaining to such series of
Securities. All Securities of any one series need not be issued at the same
time and, unless otherwise so provided by the Company, a Series may be reopened
for issuances of additional Securities of such series or to establish additional
terms of such series of Securities.
If any of the terms of the Securities of any series shall be established by
action taken by or pursuant to a Board Resolution at or prior to the delivery of
the Officers' Certificate setting forth the terms of such series, a copy of an
appropriate record of such action shall be certified by, the Secretary or an
Assistant Secretary of the Company and shall be delivered to the Trustee.
Section 302. Currency; Denominations.
The principal of, any premium and interest on and any Additional
Amounts with respect to the Securities shall be payable
21
in Money. Unless otherwise provided in or pursuant to this Indenture, Securities
shall be issuable in registered form without coupons in denominations of $1,000
and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
Securities shall be executed on behalf of the Company by one Officer and
attested by its Secretary or one of its Assistant Secretaries. The signature
of any of these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture the Company may deliver Securities, executed by the Company, to the
Trustee for authentication and, provided that the Board Resolution and Officers,
Certificate or supplemental indenture or indentures with respect to such
Securities referred to in Section 301 and a Company Order for the authentication
and delivery of such Securities have been delivered to the Trustee, the Trustee
in accordance with the Company Order and subject to the provisions hereof and of
such Securities shall authenticate and deliver such Securities.
The Trustee shall not be required to authenticate or to cause an
Authenticating Agent to authenticate any Securities if the issue of such
Securities pursuant to this Indenture will affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture or otherwise in a
manner which is not reasonably acceptable to the Trustee or if the Trustee,
being advised by counsel, reasonably determines that such action may not
lawfully be taken.
If the Company shall establish pursuant to Section 301 that the Securities
of a series are to be issued in whole or in part in the form of one or more
global Securities, the Company shall execute and the Trustee shall, in
accordance with this Section and the Company Order with respect to such series,
authenticate and deliver one or more global Securities in permanent form that
(i) shall represent and shall be denominated in an amount equal to the aggregate
principal amount of the Outstanding Securities of such series to be represented
by, such global Security or Securities, (ii) shall be registered in the name of
the Depository for such global Security or Securities or the nominee of such
Depository, (iii) shall be delivered by the Trustee to such Depository or
pursuant to such Depository's instruction and (iv) shall bear a legend
substantially to the following effect: "Unless and until it is exchanged in
whole or iii part for Securities in certificated
22
form, this Security may not be transferred except as a whole by the Depository
to a nominee of the Depository or by a nominee of the Depository to the
Depository, or another nominee of the Depository or by the Depository or any
such nominee to a successor Depository or a nominee of such successor
Depository" or to such other effect as the Depository and the Trustee may agree.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Security a
certificate of authentication substantially in the form provided for in Section
202 or 612 executed by or on behalf of the Trustee by the manual signature of
one of its authorized signatories or by an Authenticating Agent. Such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
Section 304. Temporary Securities.
Pending the preparation of definitive Securities, the Company may execute
and deliver to the Trustee and, upon Company Order, the Trustee shall
authenticate and deliver, in the manner provided in Section 303, temporary
Securities in lieu thereof which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized, denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued, in registered form and with such appropriate insertions, omissions,
substitutions and other variations as the Officers of the Company executing such
Securities may determine, as conclusively evidenced by their execution of such
Securities. Such temporary Securities may be in global form.
Except in the case of temporary Securities in global form, which shall be
exchanged in accordance with the provisions thereof, if temporary Securities are
issued, the Company shall cause definitive Securities to be prepared without
unreasonable delay. After the preparation of definitive Securities of the same
series and containing terms and provisions that are identical to those of any
temporary Securities, such temporary Securities shall be exchangeable for such
definitive Securities upon surrender of such temporary Securities at an office
or Agency for such Securities, without charge to any Holder thereof. Upon
surrender for cancellation of any one or more temporary Securities, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a like principal amount of definitive Securities of authorized
denominations of the same series and containing identical terms and provisions.
Unless otherwise provided in or pursuant to this Indenture with respect to a
temporary global Security, until so exchanged the temporary Securities of any
series shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities of such series.
Section 305. Registration, Transfer and Exchange.
23
With respect to the Securities of each series, the Company shall cause to
be kept a register (each such register being herein sometimes referred to as the
"Security Register") at an Office or Agency maintained for such series pursuant
to Section 1002 in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of the Securities of
such series and of transfers of the Securities of such series. The Trustee is
hereby initially appointed as "Security Registrar" for each series of
Securities. In the event that the Trustee shall cease to be Security Registrar
with respect to any series of Securities, it shall have the right to examine the
Security Register for such series at all reasonable times.
Upon surrender for registration of transfer of any Security of any series
at any Office or Agency for such series, the Company shall execute, and the
Trustee shall authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Securities of the same series denominated as
authorized in or pursuant to this Indenture, of a like aggregate principal
amount bearing a number not contemporaneously outstanding and containing
identical terms and provisions.
At the option of the Holder, Securities of any series (except a global
Security representing all or a portion of such series) may be exchanged for
other Securities of the same series containing identical terms and provisions,
in any authorized denominations, and of a like aggregate principal amount, upon
surrender of the Securities to be exchanged a any Office or Agency for such
series. Whenever any Securities are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, the Securities
which the Holder making the exchange is entitled to receive.
Whenever any Securities are surrendered for exchange as contemplated by the
immediately preceding two paragraphs, the Company shall execute, and the Trustee
shall authenticate and deliver, the Securities which the Holder making the
exchange is entitled to receive.
Notwithstanding the forgoing, except as otherwise provided in or pursuant
to this Indenture any global Security shall be exchangeable for definitive
Securities only if (i) the Depository is at any time unwilling, unable or
ineligible to continue as Depository and a successor depository is not appointed
by the Company within 60 days of the date the Company is so informed in writing,
(ii) the Company executes and delivers to the Trustee a Company Order to the
effect that such global Security shall be so exchangeable, or (iii) an event of
Default has occurred and continuing with respect to the Securities of the same
series. the beneficial owners of interests in a global Security are entitled to
exchange such interests for definitive Securities of such series and of like
tenor and principal amount of any authorized form and denomination as specified
as contemplated by Section 304, then without unnecessary delay but in any event
not later than the earliest date on which such interests may be so exchanged,
the
24
Company shall deliver to the Trustee definitive Securities in such form and
denominations as are required by or pursuant to this Indenture, and of the same
series, containing identical terms and in aggregate principal amount equal to
the principal amount of, such global Security, executed by the Company. On or
after the earliest date on which such interests may be so exchanged, such global
Security shall be surrendered from time to time by the Depositary, and in
accordance with instructions given to the Trustee and the Depository (which
instructions shall be in writing but need not be container in or accompanied by
an officers, Certificate or be accompanied by an Opinion of Counsel), as shall
be specified in the Company Order with respect thereto to the Trustee, as the
Company's agent for such purpose, to be exchanged; provided, however, that no
such exchanges may occur during a period beginning at the opening of business 15
days before any such selection of Securities for redemption of the same series
and containing identical terms to be redeemed and ending on the relevant
Redemption Date. Promptly following any such exchange in part, such global
Security shall be returned by the Trustee to such Depository in accordance with
the instructions of the Company referred to above. If a Security is issued in
exchange for any portion of a global Security after the close of business at
the Office or Agency for such Security where such exchange occurs on or after
(i) any Regular Record Date for such Security and before the opening of business
at such Office or Agency on the next Interest Payment Date, or (ii) any Special
Record Date for such Security and before the opening of business at such Office
or Agency on the related proposed date for payment of interest or Defaulted
Interest, as the case may be, interest shall not be payable on such Interest
Payment Date or proposed date for payment, as the case may be, in respect of
such Security, but shall be payable on such Interest Payment Date or proposed
date for payment, as the case may be, only to the Person to whom interest in
respect of such portion of such global Security shall be payable in accordance
with the provisions of this Indenture.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company evidencing the same
debt and entitling the Holders thereof to the same benefits under this Indenture
as the Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer or for
exchange or redemption shall (if so required by the Company or the Security
Registrar for such Security) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar for such Security duly executed by the Holder thereof or his attorney
duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange, or redemption of Securities, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any registration of transfer or exchange of Securities, other
than
25
exchanges pursuant to Section 304, 905 or 1107 not involving any transfer.
Except as otherwise provided in or pursuant to this Indenture, the Company
shall not be required (i) to issue, register the transfer of or exchange any
Securities during a period beginning at the opening of business 15 days before
the day of the selection for redemption of Securities of like tenor and the same
series under Section 1103 and ending at the close of business on the day of the
mailing of the relevant notice of redemption, or (ii) to register the transfer
of or exchange and Security so selected for redemption in whole or in part,
except in the case of any Security to be redeemed in part, the portion thereof
not to be redeemed, or (iii) to issue, register the transfer of or exchange any
Security which, in accordance with its terms, as been surrendered for repayment
at the option of the Holder, except the portion, if any, of such Security not to
be so repaid.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, subject to the
provisions of this Section, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security of these same
series containing identical terms and of like principal amount and bearing a
number not contemporaneously outstanding.
If there be delivered to the Company and to the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Security, and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and, upon the Company's request the Trustee
shall authenticate and deliver, in exchange for or in lieu of any such
destroyed, lost or stolen Security, a new Security of the same series containing
identical terms and of like principal amount and bearing a number not
contemporaneously outstanding.
Notwithstanding the forgoing provisions of this Section, in case any
mutilated, destroyed, lost or stolen Security has become or is about to become
due and payable, the Company in its discretion may, instead of issuing a new
Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall
26
constitute an additional original contractual obligation of the Company, whether
or not the destroyed, lost or stolen Security shall be at any time enforceable
by anyone, and shall be entitled to all the benefits of this Indenture equally
and proportionately with any and all other Securities of such series duly issued
hereunder.
The provisions of this Section, as amended or supplemented pursuant to this
Indenture with respect to particular Securities or generally, shall be exclusive
and shall preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Securities.
Section 307. Payment of Interest and Certain Additional Amounts; Rights
to Interest and Certain Additional Amounts Preserved.
Unless otherwise provided in or pursuant to this Indenture, any interest on
and any Additional Amounts with respect to any Security which shall be payable
and are punctually paid or duly provided for on any Interest Payment Date shall
be paid to the Person in whose name such Security (or one or more Predecessor
Securities) is registered as of the close of business on the Regular Record Date
for such interest.
Unless otherwise provided in or pursuant to this Indenture, any interest on
and any Additional Amounts with respect to any Security which shall be payable,
but shall not be punctually paid or duly provided for, on any Interest Payment
Date for such Security (herein called "Defaulted Interest") shall forthwith
cease to be payable to the Holder thereof on the relevant Regular Record Date by
virtue of having been such Holder; and such Defaulted Interest may be paid by
the Company, at its election in each case, as provided in Clause (1) or (2)
below:
(1) The Company may elect to make payment of any Defaulted Interest
to the Person in whose name such Security (or a Predecessor Security thereof)
shall be registered at the close of business on a Special Record Date for the
payment of such Defaulted Interest, which shall be fixed in the following
manner. The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on such Security and the date of the
proposed payment, and at the same time the Company shall deposit with the
Trustee an amount of Money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements satisfactory to
the Trustee for such deposit on or prior to the date of the proposed payment,
such Money when so deposited to be held in trust for the benefit of the Person
entitled to such Defaulted Interest as in this Clause provided. Thereupon, the
Trustee shall fix a Special Record Date for the payment of such Defaulted
interest which shall be not more than 15 days and not less than 10 days prior to
the date of the proposed payment and not less than 10 days after the receipt by
the Trustee of the notice of the proposed payment. The Trustee shall
27
promptly notify the Company of such Special Record Date and, in the name and at
the expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed,
first-class postage prepaid, to the Holder of such Security (or a Predecessor
Security thereof) at his address as it appears in the Security Register not less
than 10 days prior to such Special Record Date. Notice of the proposed payment
of such Defaulted Interest and the Special Record Date therefor having been
mailed as aforesaid, such Defaulted Interest shall be paid to the Person in
whose name such Security (or a Predecessor Security thereof) shall be registered
at the close of business on such Special Record Date and shall no longer be
payable pursuant to the following Clause (2).
(2) The, Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which such Security may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company to the Trustee
of the proposed payment pursuant to this Clause, such payment shall be deemed
practicable by the Trustee.
At the option of the Company, interest on Securities that bear interest may
be paid (i) by mailing a check to the address of the person entitled thereto as
such address shall appear in the Security Register, or (ii) by wire transfer to
an account maintained by the Person entitled thereto as specified in the
Security Register.
Subject to the foregoing provisions of this Section and Section 305, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer or
exchange, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Security is registered in the Security
Register as the owner of such Security for the purpose of receiving payment of
principal of, any premium and (subject to Sections 305 and 307) interest on and
any Additional Amounts with respect to such Security and for all other purposes
whatsoever, whether or not any payment with respect to such Security shall be
overdue, and neither the Company, nor the Trustee or any agent of the Company or
the Trustee shall be affected by notice to the contrary.
No holder of any beneficial interest in any global Security held on its
behalf by a Depository, shall have any rights under this Indenture with respect
to such global Security, and such Depository may be treated by the Company, the
Trustee, and any agent of the Company or the Trustee as the owner of such global
Security for all purposes whatsoever. None of the Company, the
28
Trustee, any Paying Agent or the Security Registrar will have any responsibility
or liability for any aspect of the records relating to or payments made on
account of beneficial ownership interests of a global Security or for
maintaining, Supervising or reviewing any records relating to such beneficial
ownership interests.
Section 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee,
and any such Securities, as well as Securities surrendered directly to the
Trustee for any such purpose, shall be canceled promptly by the Trustee. The
Company may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and may deliver to the Trustee for
cancellation any Securities previously authenticated hereunder which the Company
has not issued and sold, and all Securities so delivered shall be canceled
promptly by the Trustee. Any Securities previously authenticated and delivered
by the Company to the Trustee hereunder which the Company has not issued or sold
shall not be counted against any limits on the aggregate amount of such
Securities to be issued and sold. No Securities shall be authenticate in lieu
of or in exchange for any Securities canceled as provided in this Section,
except as expressly permitted by or pursuant to this Indenture. All canceled
Securities held by the Trustee shall be destroyed by the Trustee, and the
Trustee shall deliver to the Company a certificate of disposition with respect
thereto.
Section 310. Computation of Interest.
Except as otherwise provided in or pursuant to this Indenture, interest on
the Securities shall be computed on the basis of a 360-day year of twelve 30-day
months. Unless the terms of a particular series of Securities provides
otherwise, interest shall be payable through and excluding any Interest Payment
Date and interest shall be payable through and including any Redemption Date or
Repayment Date.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture.
Upon the direction of the Company by a Company Order, this Indenture shall
cease to be of further effect and the Trustee, on receipt of such Company Order
shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture, when
29
(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 306 and (ii) Securities
for whose payment Money has theretofore been deposited in trust with the
Trustee or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as provided in Section
1003) have been delivered to the Trustee for cancellation; or
(B) all 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) if redeemable at the option of the Company, 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
of the Company, and the Company, in the case of (i), (ii) or (iii) above,
has irrevocably deposited or caused to be deposited with the Trustee, as
trust funds and/or obligations in trust for such purpose, Money and/or
Government Obligations which through the payment of interest and principal
in respect thereof in accordance with their terms, without consideration of
any reinvestment thereof, and will provide not later than the opening of
business on the due dates of any payment of principal and any premium,
interest and Additional Amounts with respect thereto, or a combination
thereof, Money in an amount sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to the Trustee
for cancellation, including the principal of, any premium and interest on,
and any Additional Amounts with respect to such Securities, to the date of
such deposit (in the case of Securities which have become due and payable)
or to the Maturity thereof, 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 a certificate of Independent
Public Accountants certifying as to the sufficiency of the amounts deposited
pursuant to subclause (B) of Clause (1) of this Section for payment of the
principal and any premium, interest and Additional Amounts with respect thereto
on the dates such payments are due, and an Officers' Certificate and an opinion
of Counsel, each stating that all conditions precedent herein providing for or
relating to the satisfaction and discharge of this Indenture have been complied
with.
30
In the event there are Securities of two or more series hereunder, the
Trustee shall be required to execute an instrument acknowledging satisfaction
and discharge of this Indenture only if requested to do so with respect to
Securities of all series as to which it is Trustee and if the other conditions
thereto are met.
(A) with respect to all Outstanding Securities of such series, the
Company has irrevocably deposited or caused to be deposited with the
Trustee, as trust funds and/or obligations in trust for such purpose, Money
and/or Government Obligations which through the payment of interest and
principal in respect thereof in accordance with their terms, without
consideration of any reinvestment thereof, will provide not later than the
opening of business on the due dates of any payment of principal and any
premium, interest and Additional Amounts with respect thereto, or a
combination thereof, Money in an amount sufficient to pay and discharge the
entire indebtedness on all Outstanding Securities of such series not
theretofore delivered to the Trustee for cancellation, including the
principal of, any premium and interest on, and any Additional Amounts with
respect to such Securities to the date of such deposit (in the case of
Securities which have become due and payable) or to the Maturity thereof,
as the case may be, as contemplated by the penultimate paragraph of this
Section; or
(B) the Company has properly fulfilled such other means of
satisfaction and discharge as is provided in or pursuant to this Indenture
for the Securities of such series; and
In the event there are two or more Trustees hereunder, then the effectiveness of
any such instrument shall be conditioned upon receipt of each such instrument
from all Trustees hereunder.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 612 and, if Money and/or
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 403 and the last paragraph of Section 1003 shall survive.
In the event that, subsequent to the date a discharge is effected pursuant
to this Section, Additional Amounts in excess of those established as of the
date such discharge is effected become payable in respect of any Securities, in
order to preserve the benefits of the discharge established hereunder, the
Company shall deposit or cause to be deposited in accordance with provisions of
this Section, within ten business days prior to the earlier to occur of (i) one
year after the existence of such excess Additional Amounts is established and
(ii) the date the first payment in respect of any portion of such excess
Additional Amounts becomes due, such additional funds as are necessary to
satisfy the provisions of this Section as if a discharge were being effected as
of the date of such subsequent deposit. For purposes of this
31
paragraph, the existence of excess Additional Amounts shall be deemed to have
been established as of the date the governmental authority imposing the tax,
assessment or other governmental charge resulting in the Additional Amounts
first publishes the legislation, regulation or other enactment adopting such
tax, assessment or other governmental charge. Failure to comply with the
requirements of this paragraph shall result in the termination of the benefits
of the discharge established by this Section.
Section 402. Satisfaction, Discharge and Defeasance of Securities of Any
Series.
If provision is made in or pursuant to this Indenture for defeasance of
Securities of any series pursuant to this Section, the Company shall be deemed
to have paid and discharged the entire indebtedness on all the Outstanding
Securities of such series and the Trustee shall execute proper instruments
acknowledging satisfaction and discharge of such indebtedness, when
(1) no Event of Default has occurred and is continuing, or would occur
upon the giving of notice or the lapse of time, or both, at the time such
satisfaction and discharge is being effected and either
(2) the Company has paid or caused to be paid all other sums payable
hereunder with respect to the Outstanding Securities of such series; and
(3) the Company has delivered to the Trustee a certificate signed by
Independent Public Accountants certifying as to the sufficiency of the amounts
deposited pursuant to subsection (1) (A) of this Section for payment of the
principal of, any premium and interest on and any Additional Amounts with
respect to such Securities on the dates such payments are due, an Officers'
Certificate stating that no Event of Default or event which with notice or lapse
of time or both would become an Event of Default with respect to such Securities
shall have occurred and an Officer's Certificate and an Opinion of Counsel
stating that all conditions precedent herein provided for relating to the
satisfaction and discharge of the entire indebtedness on all Outstanding
Securities of any such series shall have been complied with; and
(4) the Company has delivered to the Trustee an opinion of independent
counsel or a ruling directed to the Trustee received from the Internal Revenue
Service to the effect that the Holders of the Securities of such series will not
recognize income, gain or loss for federal income tax purposes as a result of
such deposit and termination and will be subject to federal income tax on the
same amounts, in the same manner and at the same time as would have been the
case if such deposit and termination had not occurred.
Any deposits with the Trustee referred to in subsection (1) (A) of this
Section shall be irrevocable and shall be made under the terms of an escrow
trust agreement in form and substance
32
reasonably satisfactory to the Trustee. If any Outstanding Securities of such
series are to be redeemed prior to their Stated Maturity, whether pursuant to
any optional redemption provisions or in accordance with any mandatory sinking
fund requirement or otherwise, the Company shall make such arrangements as are
satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name of the Company.
Upon the satisfaction of the conditions set forth in this Section with
respect to all the Outstanding Securities of any series, the terms and
conditions of such series (including the terms and conditions with respect
thereto set forth in this Indenture, other than the provisions of Sections 305,
306, and 1002 and other than the right of Holders of Securities of such series
to receive, from the trust fund described in this Section, payment of the
principal of, any premium Or interest on, or any Additional Amounts with respect
to such Securities when such payments shall be due) and the rights, powers,
duties and immunities of the Trustee hereunder shall no longer be binding upon,
or applicable to, the Company; provided that the Company shall not be discharged
from any payment obligations in respect to Securities of such series which are
deemed not to be Outstanding under clause (iii) of the definition of Outstanding
if such obligations continue to be valid obligations of the Company under
applicable law.
In the event that, subsequent to the date a defeasance is effected pursuant
to this Section with respect to Securities of any series, Additional Amounts in
excess of those established as of the date such defeasance is effected become
payable in respect of such Securities, in order to preserve the benefits of the
defeasance established hereunder with respect to such series, the Company shall
deposit or cause to be deposited in accordance with the provisions of this
Section, within ten business days prior to the earlier to occur of (i) one year
after the existence of such excess Additional Amounts is established and (ii)
the date the first payment in respect of any portion of such excess Additional
Amounts becomes due, such additional funds as are necessary to satisfy the
provisions of this Section as if a defeasance were being effected as of the date
of such subsequent deposit. For purposes of this paragraph, the existence of
excess Additional Amounts shall be deemed to have been established as of the
date the governmental authority imposing the tax, assessment or other
governmental charge resulting in the Additional Amounts first publishes the
legislation, regulation or other enactment adopting such tax, assessment or
other governmental charge. Failure to comply with the requirements of this
paragraph shall result in the termination of the benefits of the defeasance
established by this Section with respect to the Securities of such series.
Section 403. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all Money
and Government Obligations deposited with the Trustee pursuant to Section 401 or
402 and all Money received by the Trustee in respect of Government Obligations
deposited with the
33
Trustee pursuant to Section 401 or 402 shall be held in trust and applied by it,
in accordance with the provisions of the Securities and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal and any premium, interest and Additional
Amounts for whose payment such Money has or Government Obligations have been
deposited with or received by the Trustee; but such Money and Government
Obligations need not be segregated from other funds of the Trustee except to the
extent required by law.
ARTICLE FIVE
REMEDIES
Section 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities of
any series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or be effected by Operation
of law pursuant to any judgment, decree or order of any court or any order, rule
or regulation of any administrative or governmental body):
(1) default in the payment of any interest on or any Additional
Amounts payable in respect of any Security of such series when such
interest becomes or such Additional Amounts become due and payable, and
continuance of such default for a period of 10 days; or
(2) default in the payment of the principal of and any premium on any
Security of such series when it becomes due and payable at its Maturity,
upon redemption or upon repayment and continuance of such default for a
period of 5 days; or
(3) default in this deposit of any sinking fund payment, when and as
due by the terms of a Security of such series and continuance of such
default for a period of 5 days; or
(4) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture or the Securities (other than a
covenant or warranty a default in the performance or the breach of which is
elsewhere in this Section specifically dealt with or which has been
expressly included in this Indenture solely for the benefit of a series of
Securities other than such series), and continuance of such default or
breach for a period of 30 days after there has been given, by registered or
certified mail, to the Company by the Trustee or to the Company and the
Trustee by the Holders of at least 25% in principal amount of the
Outstanding Securities of such series a written notice specifying such
default or breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" hereunder; or
34
(5) default in the payment at stated maturity of an obligation for
Indebtedness for Money Borrowed of the Company or a Subsidiary in principal
amount due at stated maturity in excess of $1,000,000, and such default
shall continue, without being cured, waived or consented to and without
such indebtedness being discharged, for a period of 30 days beyond any
applicable period of grace; or
(6) an event of default as defined in any mortgage, indenture or
instrument under which there may be issued, or by which there may be
secured or evidenced, any Indebtedness for Money Borrowed of the Company or
any Subsidiary (including a default under this Indenture with respect to
Securities of any series other than such series), whether such Indebtedness
for Money Borrowed now exists or shall hereafter be created, shall happen
and shall result in such Indebtedness for money Borrowed in principal
amount in excess of $1,000,000 becoming or being declared due aid payable
prior to the date on which it would otherwise become due and payable, and
such acceleration shall not be rescinded or annulled, or such indebtedness
shall not have been discharged, within a period of 30 days after there
shall have been given, by registered or certified mail, to the Company by
the Trustee or to the Company and the Trustee by the Holders of at least
25% in principal amount of the Outstanding Securities of such series, a
written notice specifying such event of default and requiring the Company
to cause such acceleration to be rescinded or annulled or to cause such
Indebtedness for Money Borrowed to be discharged and stating that such
notice is a "Notice of Default" hereunder; or
(7) the entry by a court or agency or supervisory authority having
competent jurisdiction of:
(A) a decree or order for relief in respect of the Company or
any Significant Subsidiary in an Involuntary proceeding under any
Applicable bankruptcy, insolvency, reorganization or other similar law
and such decree or order shall remain unstayed and in effect for a
period of 60 consecutive days; or
(B) a decree or order adjudging the Company or any Significant
Subsidiary to be insolvent, or approving a petition seeking
reorganization, arrangement, adjustment or composition off the Company
or any Significant Subsidiary and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or
(C) a decree or order appointing any other Person to act as a
custodian, receiver, liquidator, assignee, trustee or other similar
official of the Company or any Significant Subsidiary or of any
substantial part of the property of the Company or any Significant
Subsidiary, as the case may be, or ordering the winding up or
liquidation of the affairs of the Company or any
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Significant Subsidiary and such decree or order shall remain unstayed
and in effect for a period of 60 consecutive days; or
(8) the commencement by the Company or any Significant Subsidiary of
a voluntary proceeding under any applicable bankruptcy, insolvency,
reorganization or other similar law or of a voluntary proceeding seeking to
be adjudicated insolvent or the consent by the Company or any Significant
Subsidiary to the entry of a decree or order for relief in an involuntary
proceeding under any applicable bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any insolvency proceedings
against it, or the filing by the Company or any Significant Subsidiary of a
petition or answer or consent seeking reorganization or relief under any
applicable law, or the consent by the Company or any Significant Subsidiary
or the filing of such petition or to the appointment of or taking
possession by a custodian, receiver, liquidator, assignee, trustee or
similar official of the Company or any Significant Subsidiary or any
substantial part of the property of the Company or any Significant
Subsidiary or the making by the Company or any Significant Subsidiary of an
assignment for the benefit of creditors, or the taking of corporate action
by the Company or any Significant Subsidiary in furtherance of any such
action; or
(9) a final judgment, judicial decree or order for the payment of
money in excess of $5,000,000 shall be rendered against the Company or any
Significant Subsidiary and such judgment, decree or order shall continue
unsatisfied for a period of 30 days without a stay of execution; or
(10) any other Event of Default provided in or pursuant to this
Indenture with respect to Securities of such series.
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any series at the time
Outstanding occurs and is continuing, then the Trustee or the Holders of not
less than 25% in principal amount of the Outstanding Securities of such series
may declare the principal of all the Securities of such series, or such lesser
amount as may be provided for in the Securities of such series, and the interest
accrued thereon and Additional Amounts payable in respect thereof, if any, to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by the Holders), and upon any such declaration such amount
shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the Money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of not less than a majority in principal amount of
the Outstanding
36
Securities of such series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences, on behalf
of all Holders, if
(1) the Company has paid or deposited with the Trustee a sum of Money
sufficient to pay
(A) all overdue installments of any interest on and Additional
Amounts with respect to all Securities of such series,
(B) the principal of and any premium on any Securities of such
series which have become due otherwise than by such declaration of
acceleration and interest thereon and any Additional Amounts with
respect thereto at the rate or rates borne by or provided for in such
Securities,
(C) to the extent that payment of such interest or Additional
Amounts is lawful, interest upon overdue installments of any interest
and Additional Amounts at the rate or rates borne by or provided for
in such Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel; and
(2) all Events of Default with respect to Securities of such series, other
than the non-payment of the principal of, any premium and interest or, and any
Additional Amounts with respect to Securities of such series which shall have
become due solely by such declaration of acceleration shall have been cured or
waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if
(1) default is made in the payment of any installment of interest on or
any Additional Amounts with respect to any series of Security when such interest
or Additional Amounts shall have become due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the principal of or any premium on
any series of Security at its Maturity and such default continues for a period
of 5 days,
37
the Company shall, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such series of Securities, the whole amount of Money
then due and payable with respect to such series of Securities, with interest
upon the overdue principal, any premium and, to the extent that payment of such
interest shall be legally enforceable, upon any overdue installments of interest
and Additional Amounts at the rate or rates borne by or provided for in such
series of Securities, and, in addition thereto, such further amount of Money as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
If the Company fails to pay the Money it is required to pay the Trustee
pursuant to the preceding paragraph forthwith upon the demand of the Trustee,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the Money so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon such Securities and collect the
Money adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon such Securities, wherever
situated.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or such Securities or in aid of the
exercise of any power granted herein or therein, or to enforce any other proper
remedy.
Section 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or such other obligor their creditors,
the Trustee (irrespective of whether the principal of the Securities shall then
be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand on the Company
for the payment of any overdue principal, premium, interest or Additional
Amounts) shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(1) to file and prove a claim for the whole amount, or such lesser
amount as may be provided for in the Securities of such series, of the
principal and any premium, interest and Additional Amounts owing and unpaid
in respect of the Securities and to file such other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation,
38
expenses, disbursements and advances of the Trustee, its agents or counsel)
and of the Holders of Securities allowed in such judicial proceeding, and
(2) to collect and receive any Monies or other property payable or
deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities to make such payments to the Trustee and, in the
event that the Trustee shall consent to the making of such payments
directly to the Holders of Securities, to pay to the Trustee any amount due
to it for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel and any other amounts due the
Trustee under Section 607.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a Security
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 Holder of a Security in any such proceeding;
provided, however, that the Trustee may, on behalf of the Holders of Securities,
vote for the election of a trustee in bankruptcy or similar official and may be
a member of any creditors' committee.
Section 505. Trustee May Enforce Claims without Possession of Securities.
All rights of action and claims under this Indenture or any of
the Securities may be prosecuted and enforced by the Trustee without the
possession of any of the Securities or the production thereof in any proceeding
relating thereto, and any such proceeding instituted by the Trustee shall be
brought in its own name as trustee of an express trust, and any recovery or
judgment, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel,
shall be for the ratable benefit of each and every Holder of a Security in
respect of which such judgment has been recovered.
Section 506. Application of Money Collected.
Any Money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such Money on account of principal, or any
premium, interest or Additional Amounts, upon presentation of the Securities,
and the notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:
FIRST: To the payment of costs and expenses of collection,
including all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses and disbursements of the Trustee, its
agents and counsel and all
39
other amounts due the Trustee and any predecessor Trustee under Section
607;
SECOND: In the case the principal of the Securities shall not have
become due and payable, to the payment of the amounts then due and unpaid
upon the Securities for interest and Additional Amounts in respect of which
or for the benefit of which such Money has been collected, in the order of
the Maturity of the installments of such interest and Additional Amounts,
with interest, to the extent that such interest is lawful and has been
collected by the Trustee, upon overdue installments of interest and
Additional Amounts at the rate or rates borne by or provided for in the
Securities (or, in the case of Original Issue Discount Securities, at the
yield to Stated Maturity), such payments to be made ratably, without
preference or priority of any kind, according to the aggregate amounts due
and payable on such Securities for interest and Additional Amounts,
respectively;
THIRD: In the case the principal of the Securities shall have
become due and payable, to the payment of the amounts then due and unpaid
upon the Securities for principal and any premium, interest and Additional
Amounts in respect of which or for the benefit of which such Money has been
collected, with interest, to the extent that such interest is lawful and
has been collected by the Trustee, upon overdue installments of interest
and Additional amounts at the rate or rates borne by or provided for in the
Securities (or, in the case of Original Issue Discount Securities, at the
yield to Stated Maturity), such payments to be made ratably,
without preference or priority of any kind, according to the aggregate
amounts due and payable in such Securities for principal and any premium,
interest and Additional Amounts, respectively; and
FOURTH: The balance, if any, to the Company.
Section 507. Limitations on Suits.
No Holder of any Security of any series shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder
unless
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Securities of such
series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of such series shall have made written request to
the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
40
(3) such Holder or Holder have offered to the Trustee indemnity
satisfactory to the Trustee against the costs, expenses and liabilities to
be incurred in compliance with such request (including reasonable fees of
counsel) ;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a majority
in principal amount of the Outstanding Securities of such series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture or any Security to affect, disturb or prejudice the rights of
any other such Holders or Holders of Securities of any other series, or to
obtain or to seek to obtain priority or preference over any other Holders or to
enforce any right under this Indenture, except in the manner herein provided and
for the equal and ratable benefit of all such Holders.
Section 508. Unconditional Right of Holder to Receive Principal and any
Premium, Interest and Additional Amounts.
Notwithstanding any other Provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of, any premium and (subject to Sections 305 and 307)
interest on, and any Additional Amounts with respect to such Security on the
respective Stated Maturity or Maturities therefor specified in such Security
(or, in the case of redemption, on the Redemption Date or, in the case of
repayment at the option of such Holder if provided in or pursuant to this
Indenture, or the Repayment Date such repayment is due) and to institute suit
for the enforcement of any such payment, and such right shall not be impaired
without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder of a Security has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case the Company, the
Trustee and each such Holder shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Trustee and each such
Holder shall not continue as though no such proceeding had been instituted.
Section 510. Rights and Remedies Cumulative.
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Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of Section
306, no right or remedy herein conferred upon or reserved to the Trustee or to
each and every Holder of a Security is intended to be exclusive of any other
right or remedy, and every right and remedy, to the extent permitted by law,
shall be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
Section 511. Delay or Omission not Waiver.
No delay or omission of the Trustee or of any Holder of any Security
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by, this Article or by
law to the Trustee or to any Holder of a Security may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by such Xxxxxx,
as the case may be.
Section 512. Control by Holders of Securities.
The Holders of a majority in principal amount of the Outstanding Securities
of any series shall have the right to 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 with respect to the Securities of
such series, provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture or with the Securities of any series,
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction, and
(3) that (subject to he provisions of Section 601) the Trustee shall
have the right to decline to follow any such direction if the Trustee,
being advised by counsel, shall determine that the action or proceeding so
directed may not lawfully be taken, or if the Trustee in good faith shall
determine that the action or proceedings so directed might involve the
Trustee in personal liability or if the Trustee in good faith shall so
determine that the actions or forbearance specified in or pursuant to such
direction shall be unduly prejudicial to the interest of Holders not
joining in the giving of said direction, it being understood that (subject
to Section 601) the Trustee shall have no duty to ascertain whether or not
such actions or forbearance are unduly prejudicial to such Holders.
42
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series on behalf of the Holders of all the
Securities of such series may waive any past default hereunder with respect to
such series and its consequences, except a default
(1) in the payment of the principal of, any premium or interest on,
or any Additional Amounts with respect to any Security of such series, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
Section 514. Waiver of Stay or Extension Laws.
The Company covenants that (to the extent that it may lawfully do so) it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company expressly waives (to the extent
that it may lawfully do so) all benefit or advantage of any such law and
covenants that it will not hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of every
such power as though no such law had been enacted.
ARTICLE SIX
THE TRUSTEE
Section 601. Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties, and only such
duties, as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
43
(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; but in the case of any such certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under a duty to examine
the same to determine whether or not they conform to the requirements
of this Indenture.
(b) In case 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 its exercise, as a
prudent Person would exercise or use under the circumstances in the conduct of
his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction
of the Holders of a majority in principal amount of the Outstanding
Securities of any series, relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Indenture with respect to the Securities of such series, provided such
direction shall not be in conflict with any rule of law or with this
Indenture; and
(4) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any
of its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
44
Section 602. Notice of Defaults.
Within 90 days after the occurrence of any default hereunder with
respect to the Securities of any series, the Trustee shall transmit, in the
manner and to the extent provided in Section 313(c) of the Trust Indenture Act,
notice of such default hereunder known to the Trustee, unless such default shall
have been cured or waived; provided, however, that in the case of any default of
the character specified in Section 501 (4) with respect to Securities of such
series, no such notice to Holders shall be given until at least 30 days after
the occurrence thereof. Except in the case of a default in the payment to
principal of or interest on any Security, and the failure to make payment when
required by Section 1303, the Trustee may withhold the notice to the Holders if
and so long as a committee of its Responsible Officers determines in good faith
that withholding the notice is in the interest of the Holders. For the purpose
of this Section, the term "default" means any event which is, or after notice or
lapse of time or both would become, an Event of Default, with respect to
Securities of such series.
Section 603. Certain Rights of Trustee.
Subject to Sections 3.5(a) through 315(d) of the Trust Indenture Act and to
Section 601 of this Indenture:
(1) Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond,
debenture, note, coupon or other paper or document reasonably believed by
it to be genuine and to have been signed or presented by the proper party
or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or a Company Order (in each
case, other than delivery of any Security to the Trustee or authentication
and delivery pursuant to Section 303, which shall be sufficiently evidenced
as provided therein) and any resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence shall be herein specifically prescribed) may, in the absence
of bad faith on its part, rely upon an Officers' Certificate;
(4) before the Trustee acts or refrains from acting, the Trustee may
consult with counsel and the written advice of such counsel or any Opinion
of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon;
45
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by or pursuant to this Indenture at the
request or direction of any of the Holders of Securities of any series
pursuant to this Indenture, unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it, including reasonable fees of
counsel, in complying with such request or direction;
(6) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, coupon or other piper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such facts
or matters as it may see fit, and, if the Trustee shall determine to make
such further inquiry or investigation, it shall be entitled to examine,
during business hours and upon reasonable notice, the books, records and
premises of the Company, personally or by agent or attorney;
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any, duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney (other than the misconduct
or negligence of an agent or attorney who is an employee of the Trustee)
appointed with due care by it hereunder;
(8) the Trustee shall not be liable for any action taken or omitted
by it in good faith and with due care and believed by it to be authorized
or within the discretion, rights or powers conferred upon it by this
Indenture;
(9) the Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder;
(10) the permissive rights of the Trustee to do things enumerated in
this Indenture shall not be construed as a duty and the Trustee shall not
be answerable for other than its negligence or willful misconduct; and
(11) except for (i) a default under Sections 501 (1) , (2) or (3)
hereof, or (ii) any other event of which the Trustee has "actual knowledge"
and which event, with the giving of notice or the passage of time or both,
would constitute an Event of Default under this Indenture, the Trustee
shall not be deemed to have notice of any default or event unless
specifically notified in writing of such event by the Company or the
Holders of not less than 25% in aggregate principal amount of the
Securities Outstanding; as used herein, the term "actual knowledge" means
the actual fact or
46
statement of knowing, without any duty to make any investigation with
regard thereto.
Section 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificate of authentication, shall be taken as the statements of the
Company and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations
as to the validity or sufficiency of this Indenture or of the Securities,
except that the Trustee represents that it is duly authorized to execute
and deliver this Indenture, authenticate the Securities and perform its
obligations hereunder and that the statements made by it in a Statement of
Eligibility and Qualification on Form T-1 supplied to the Company are true
and accurate, subject to the qualifications set forth therein. Neither the
Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of the Securities or the proceeds thereof.
Section 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other Person that may be an agent of the Trustee or the
Company, in is individual or any other capacity, may become the owner or
Pledge,e of Securities and, subject to Sections 310(b) and 311 of the Trust
Indenture Act, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other Person.
Section 606. Money Held in Trust.
Except as provided in Section 403 and Section 1003, Money held by the
Trustee in trust hereunder need not be segregated from other funds except to the
extent required by law and shall be held uninvested. The Trustee shall be under
no liability for interest on any Money received by it hereunder except as
otherwise agreed with the Company.
Section 607. Compensation and Indemnity.
The Company agrees:
(1) to pay to the Trustee from time to time, and the Trustee shall be
entitled to, reasonable compensation for all services rendered by the
Trustee hereunder (which compensation shall not be limited by any provision
of law in regard to the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the
47
Trustee in accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its agent and
counsel), except any such expense, disbursement or advance as may be
attributable to the Trustee's negligence or willful misconduct; and
(3) to indemnify the Trustee and its agents for, and to hold them
harmless against, any loss, liability or expense incurred without willful
misconduct or negligence on their part, arising out of or in connection
with the acceptance or administration of the trust or trusts hereunder,
including the costs and expenses of defending themselves against any claim
or liability in connection with the exercise or performance of any of their
powers or duties hereunder. The Trustee shall notify the Company promptly
of any claim asserted against it for which it may seek indemnity. The
Company shall defend the claim and the Trustee shall provide reasonable
cooperation in the defense. The Trustee may have separate counsel and the
Company shall pay the reasonable fees and expenses of such counsel;
PROVIDED that the company will not be required to pay such fees and
expenses if it assumes the Trustee's defense and there is no conflict of
interest between the Company and the Trustee in connection with such
defense. The Company need not pay for any settlement made without its
written consent. The Company need not reimburse any expense or indemnify
against any loss or liability incurred by the Trustee through the Trustee's
own willful misconduct or negligence.
As security for the performance of the obligations of the Company under
this Section, the Trustee shall have a lien prior to the Securities of any
series upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the payment of principal of, and premium or
interest on or any Additional Amounts with respect to Securities. "Trustee" for
the purposes of this Section includes any predecessor Trustee, but misconduct,
negligence or bad faith of any Trustee shall not be attributed to any other
Trustee.
Section 608. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America, any
state thereof or the District of Columbia, authorized under such laws to
exercise corporate trust powers, or any other person permitted by the Trust
Indenture Act to act as trustee under an indenture qualified under the Trust
Indenture Act and that has a combined capital and surplus (computed in
accordance with Section 31O(a) (2) of the Trust Indenture Act) of at least
$50,000,000. If at any time the Trustee shall cease to be eligible in
accordance with, the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
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Section 609. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee pursuant to Section 610.
(b) The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 610 shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to such
series.
(c) The Trustee may be removed at any time with respect to the Securities
of any series by act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the obligations imposed
upon it under Section 310(b) of the Trust Indenture Act with respect to
Securities of any series after written request therefor by the Company or
any Holder of a Security of such series who has been a bona fide Holder of
a Security of such series for at least six months, or
(2) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company, by or pursuant to a Board Resolution,
may remove the Trustee with respect to all Securities or the Securities of such
series, or (ii) subject to Section 315(e) of the Trust Indenture Act, any Holder
of a Security who has been a bona fide Holder of a Security of such series for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Trustee with
respect to all Securities of such series and the appointment of a successor
Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, with respect
to the Securities of one or more series, the Company, by or pursuant to a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Securities of that or those series (it being understood that any such
successor trustee may be appointed with respect to the
49
Securities of one or more or all of such series and that at any time there shall
be only one Trustee with respect to the Securities of any particular series) and
shall comply with the applicable requirements of Section 610. If, within one
year after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee with respect to the Securities of any series shall
be appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
610, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any series shall have
been so appointed by the Company or the Holders of Securities and accepted
appointment in the manner required by Section 610, any Holder of a Security who
has been a bona fide Holder of a Security of such series for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
Section 610. Acceptance of Appointment by Successor.
(a) Upon the appointment hereunder of any successor Trustee with
respect to all Securities, such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties hereunder of the retiring Trustee; but, on the request
of the Company or such successor Trustee, such retiring Trustee, upon payment of
its charges, shall execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trustee of the retiring Trustee
and, subject to Section 1003, shall duly assign, transfer and deliver to such
successor Trustee all property and Money held by such retiring Trustee
hereunder, subject nevertheless to its claim, if any, provided for in Section
607. A successor Trustee shall give notice of its succession to each Holder by
mailing written notice of such event by first-class mail, postage prepaid, to
the Holders of Securities, if any, of such series as their names and addresses
appear in the Security Register. Each notice shall include the name of the
successor Trustee with respect to the Securities of such series and the address
of its Corporate Trust Office.
(b) Upon the appointment hereunder of any successor Trustee with respect
to the Securities of one or more (but not all series, the Company, the retiring
Trustee and such successor Trustee shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment
and which (1) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, such successor Trustee all
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the rights, powers, trusts and duties of the retiring Trustee with respect to
the Securities of that or those series to which the appointment of such
successor, Trustee relates, (2) if the retiring Trustee is not retiring with
respect to all Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
as to which the retiring Trustee is not retiring shall continue to be vested in
the retiring Trustee, and (3) shall add to or change any of the provisions of
this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust, that each such Trustee
shall be trustee of a trust or trusts hereunder separate and apart from any
trust or trusts hereunder administered by any other such Trustee and that no
Trustee shall be responsible for any notice given to, or received by, or any act
or failure to act on the part of any other Trustee hereunder, and, upon the
execution and delivery of such supplemental indenture, the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein, such retiring Trustee shall have no further responsibility for the
exercise of rights and powers or for the performance of the duties and
obligations vested in the Trustee under this Indenture with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates other than as hereinafter expressly set forth, and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee
with respect to the Securities of that or those series to which the appointment
of such successor Trustee relates; but, on request of the company or such
successor Trustee, such retiring Trustee, upon payment of its charges with
respect to the Securities of that or those series to which the appointment of
such successor relates and subject to Section 1003, shall duly assign, transfer
and deliver to such successor Trustee, to the extent contemplated by such
supplemental indenture, the property and Money held by such retiring Trustee
hereunder with respect to the Securities of that or those series to which the
appointment of such successor Trustee relates.
(c) Upon request of any Person appointed hereunder as a successor Trustee,
the Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Trustee all such rights, powers and
trusts referred to in paragraph (a) or (b) of this Section, as the case may be.
(d) No Person shall accept its appointment hereunder as a successor
Trustee unless at the time of such acceptance such successor Person shall be
qualified and eligible under this Article.
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Section 611. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or, any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto provided such corporation shall be otherwise qualified
and eligible under this Article Six. In case any Securities shall have been
authenticated but not delivered by the Trustee then in office, any successor by
merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
Section 612. Appointment of Authenticating Agent.
The Trustee may appoint one or more Authenticating Agents acceptable to the
Company with respect to one or more series of Securities which shall be
authorized to act on behalf of the Trustee to authenticate Securities of that or
those series issued upon original issue, exchange registration of transfer,
partial redemption or pursuant to Section 306, and Securities so authenticated
shall be entitled to the benefits of this Indenture and shall be valid and
obligatory for all purposes as if authenticated by the Trustee hereunder.
Wherever reference is made in this Indenture to the authentication and delivery
of Securities by the Trustee or the Trustee's certificate of authentication,
such reference shall be deemed to include authentication and delivery on behalf
of the Trustee by an Authenticating Agent and a certificate of authentication
executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and, except as
provided in or pursuant to this Indenture, shall at all times be a corporation
that would be permitted by the Trust Indenture Act to act as trustee under an
indenture qualified under the Trust Indenture Act, is Authorized under
applicable law and by its charter to act as an Authenticating Agent and has a
combined capital and surplus (computed in accordance with Section 310(a)(2) of
the Trust Indenture Act) of at least $50,000,000. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust
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business of an Authentication Agent, shall be the successor of such
Authenticating Agent hereunder, provided such corporation shall be otherwise
eligible under this Section, without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders of
Securities, if any, of the series with respect to which such Authenticating
Agent shall serve, as their names and addresses appear in the Security Register.
Any successor Authenticating Agent, upon acceptance of its appointment
hereunder, shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
The Company agrees to pay each Authenticating Agent from time to time
reasonable compensation for its services under this Section. If the Trustee
makes such payments, it shall be entitled to be reimbursed for such payments,
subject to the provisions of Section 607.
The provisions of Section 308, 604 and 605 shall be applicable to each
Authenticating Agent.
If an Authenticating Agent is appointed with respect to one or more series
of Securities pursuant to this Section, the Securities of such series may have
endorsed thereon, in addition to or in lieu of the Trustee's certificate of
authentication, an alternate certificate of authentication in the following form
"This is one of the Securities of the series designated herein referred to
in the within-mentioned Indenture.
------------------------------
As Authenticating Agent
By ---------------------------
Authorized Signatory"
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If all of the Securities of any series may not be originally issued at one
time, and if the Trustee does not have an office capable of authenticating
Securities upon original issuance located in a Place of Payment where the
Company wishes to have Securities of such series authenticated upon original
issuance, the Trustee, if so requested in writing which writing need not be
accompanied by or contained in an Officers' Certificate by the Company), shall
appoint in accordance with this Section an Authenticating Agent having an office
in a Place of Payment designated by the Company with respect to such series of
Securities.
ARTICLE SEVEN
XXXXXX'S LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Company to Furnish Trustee Names and Addresses of Holders.
In accordance with Section 312(a) of the Trust Indenture Act, the Company
shall furnish or cause to be furnished to the Trustee
(1) semi-annually with respect to Securities of each series on
January 15 and July 15 of each year or upon such other dates as are set
forth in or pursuant to the Board Resolution or indenture supplemental
hereto authorizing such series, a list, in each, case in such form as the
Trustee may reasonably require, of the names and addresses of Holders as of
the applicable date, and
(2) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the
time such list is furnished,
provided, however, that so long as the Trustee is the Security Registrar no such
list shall be required to be furnished for Securities for which the Trustee acts
as Security Registrar.
Section 702. Preservation of Information; Communications to Holders.
The Trustee shall comply with the obligations imposed upon it pursuant to
Section 312 of the Trust Indenture Act.
Every Holder of Securities, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company, the Trustee, any Paying
Agent or any Security Registrar shall be held accountable by reason of the
disclosure of any such information as to the name and addresses of the Holders
of Securities in accordance with Section 312 of the Trust Indenture Act,
regardless of the source from which such information was derived, and that the
Trustee shall not be held accountable by
54
reason of mailing any material pursuant to a request made under Section 312(b)
of the Trust Indenture Act.
Section 703. Reports by Trustee.
(a) Within 60 days after May 15 of each year commencing with the first May
15 following the first issuance of Securities pursuant to Section 301, if
required by Section 313(a) of the Trust Indenture Act, the Trustee shall
transmit, pursuant to Section 313(c) of the Trust Indenture Act, a brief report
dated as of such May 15 with respect any of the events specified in said Section
313(a) which may have occurred since the later of the immediately Preceding May
15 and the date off this Indenture.
(b) The Trustee shall Transmit the reports required by Section 313(a) of
the Trust Indenture Act at the times specified therein.
(c) Reports pursuant to this Section, shall be transmitted in the manner
and to the Persons required by Sections 313(c) and 313(d) of the Trust Indenture
At.
Section 704. Reports by Company.
The Company, pursuant to Section 314(a) of the Trust Indenture Act, shall:
(1) file with the Trustee, within 15 days after the Company is
required to file the same with the Commission, copies of the annual reports
and of the information, documents and other reports (or copies of such
portions of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Company may be required to file
with the Commission pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934, as amended; or, if the Company is not
required to file information, documents or reports pursuant to either of
said Sections, then it shall file with the Trustee and the Commission, in
accordance with rules and regulations prescribed from time to time by the
Commission, such of the supplementary and periodic information, documents
and reports which may be required pursuant to Section 13 of the Securities
Exchange Act of 1934, as amended, in respect of a security listed and
registered on a national securities exchange as may be prescribed from time
to time in such rules and regulations; provided that notwithstanding the
requirements of such rules and regulations, so long as any Security is
Outstanding the Company shall file with the Trustee at a minimum (A) within
105 days after the end of each fiscal year, copies of a balance sheet and
statements of income and retained earnings of the Company as of the end of
and for such fiscal year, audited by independent public accountants, and
(B) within 60 days after the end of each Quarterly fiscal period, except
for the last quarterly fiscal period in each fiscal year, a
55
summary statement (which need not be audited) of income and retained
earnings of the Company for such period;
(2) file with the Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect compliance by
the Company, as the case may be, with the conditions and covenants of this
Indenture as may be required from time to time by such rules and
regulations;
(3) transmit to the Holders of Securities within 30 days after the
filing thereof with the Trustee, in the manner and to the extent provided
in Section 313(c) of the Trust Indenture Act, such summaries of any
information, documents and reports required to be filed by the Company
pursuant to paragraphs (1) and (2) of his Section as may be required by
rules and regulations prescribed from time to time by the Commission;
provided that notwithstanding the requirements of such rules and
regulations, so long as any Security is Outstanding the Company shall
transmit to the Holders of Securities, within 30 day after the filing
thereof with the Trustee, in the manner an to the extent provided in
Section 313 (c) of the Trust Indenture Act, the information, documents and
other reports required to be filed by the Company pursuant to paragraph (1)
of this Section; provided, further that in lieu of any Annual Report on
Form 10-K, the Company may transmit an annual report containing financial
statements and an undertaking to transmit such Form 10-K to any Holder upon
request; provided further that the Company shall not be required to
transmit to the Holders any Quarterly Report on Form 10-Q or summary in
lieu thereof unless the Company adopts a policy of regularly distributing
summary quarterly reports to holders of its equity securities and others,
in which event, the Company shall distribute such summary quarterly reports
to the Holders of the Securities; and
(4) furnish to the Trustee the Officers Certificates and notices
required by Section 1012.
ARTICLE EIGHT
CONSOLIDATION, MERGER AND SALES
Section 801. Company May Consolidate, Etc., Only on Certain Terms.
Nothing contained in this Indenture or in any of the Securities shall
prevent any consolidation or merger of the Company with or into any other Person
or Persons (whether or not affiliated with the Company) or successive
consolidations or mergers in which the Company or its successor or successors
shall be a party or parties, or shall prevent any conveyance, transfer or lease
of the property of the Company as an entirety or substantially as an
56
entirety, to any other Person (whether or not affiliated with the Company);
provided, however, that
(1) except in connection with a sale, financing or securitization of
receivables or transfer made in the ordinary course of business, if the
Company shall consolidate with or merge into another Person or convey,
transfer or lease its properties and assets substantially as an entirety to
any Person (other than a wholly owned Subsidiary), the entity formed by
such consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer, or which leases, the properties and
assets of the Company substantially as an entirety shall be a Person
organized and existing under the laws of the United States of America, any
state thereof or the District of Columbia and shall expressly assume, by
an indenture (or indentures, if at such time there is more than one
Trustee) supplemental hereto, executed by the successor Person and
delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of the principal of, and premium and interest on and any
Additional Amounts with respect to all the Securities and the performance
of every other covenant of this Indenture on the part of the Company to be
performed or observed;
(2) immediately after giving effect to such transaction, no event
which, after notice or lapse of time, or both, would become an Event of
Default shall have occurred and be continuing; and
(3) either the Company or the successor Person shall have delivered
to the Trustee an Officers' Certificate and an Opinion of Counsel, stating
that such consolidation, merger, conveyance, transfer or lease and such
supplemental indenture comply with this Article and that all conditions
precedent herein provided for relating to such transaction have been
complied with.
Section 802. Successor Person Substituted for Company.
Upon any consolidation or merger or any conveyance, transfer or lease of
the properties and assets of the Company substantially as an entirety to any
Person in accordance with Section 801, the successor Person formed by such
consolidation or into which the Company is merged or to which, such conveyance,
transfer or lease is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture with the
same effect as if such successor Person had been named as the Company herein;
and thereafter, except in the case of a lease to another Person, the predecessor
Person shall be released from all obligations and covenants under this Indenture
and the Securities.
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ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 901. Without Consent Holders.
Without the consent of any Holder of Securities, the Company (when
authorized by or pursuant to a Board Resolution) and the Trustee, at any time
and from time to time, may amend this Indenture or enter into one or more
indentures supplemental hereto, without notice to any Holder, which shall
conform with the requirements of the Trust Indenture Act as then in effect and
be in form satisfactory to the Trustee, for any of the following purposes
(1) to evidence the succession of another Person to the Company, and
the assumption by any such successor of the covenants of the Company herein
and in the Securities; or
(2) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities (as shall be specified in such
amendment or supplemental indenture or indentures) or to surrender any
right or power herein conferred upon the Company; or
(3) to add to or change any of the provisions of this Indenture to
change or eliminate any restrictions on the payment of principal of, any
premium or interest on or any Additional Amounts with respect to Securities
or to permit or facilitate the issuance of Securities in uncertificated
form, provided any such action shall not adversely affect the interests of
the Holders of Securities of any series in any material respect; or
(4) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(5) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 610(b); or
(6) to cure any ambiguity or to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture which shall not adversely affect the
interests of the Holders of Securities of any series in any material
respect; or
(7) to add any additional Events of Default with respect to all or
any series of Securities (as shall be specified in such amendment or
supplemental indenture); or
58
(8) to supplement any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the defeasance and
discharge of any series of Securities pursuant to Article Four; provided
that any such action shall not adversely affect the interests of any Holder
of a Security of such series or any other Security in any material respect;
or
(9) to amend or supplement any provision contained herein or in any
amendment or supplemental indenture, provided that no such amendment or
supplement shall adversely affect the interests of the Holders of any
Securities, if any, then Outstanding in any material respect; or
(10) to effect, or maintain the qualifications of this Indenture under
the Trust Indenture Act.
Section 902. With Consent of Holders.
With the consent of the Holders of not less than a majority in principal
amount of the Outstanding Securities of each series affected by such waiver,
amendment or supplemental indenture, by Act of said Holders delivered to the
Company and the Trustee, the Company (when authorized by or pursuant to a Board
Resolution), and the Trustee may amend this Indenture or enter into one or more
indentures supplemental hereto (which shall conform with the requirements of the
Trust Indenture Act as then in effect) or waive compliance by the Company with
any provision of this Indenture, in each case without notice to any other
Holder; provided, however, that no such waiver, amendment or supplemental
indenture, without the consent of the Holder of each Outstanding Security
affected thereby, shall
(1) change the Stated Maturity of the principal of, or any premium or
installment of interest on or any Additional Amounts with respect to, any
Security, or reduce the principal amount thereof or the rate of interest
thereon or any Additional Amounts with respect thereto, or any premium
payable upon the redemption thereof or otherwise, or change the obligation
of the Company to pay Additional Amounts pursuant to Section 1004 (except
as contemplated by Section 801(1) and permitted by Section 901(1)), or
reduce the amount of the principal of an Original Issue Discount Security
that would be due and payable upon a declaration of acceleration of the
Maturity thereof pursuant to Section 502 or the amount thereof provable in
bankruptcy pursuant to Section 504, or adversely affect the right of
repayment at the option of any Holder as contemplated by Article Thirteen,
or adversely affect the conversion rights of a Holder of Securities which
may be converted in whole or in part into common stock, or change the Place
of Payment, currency in which the principal of, any premium or interest on,
or any Additional Amounts with respect to any Security is payable, or
impair the right to institute suit for the enforcement of any such payment
on or after the Stated Maturity thereof (or, in the case of
59
redemption, on or after the Redemption Date or, in the case of repayment at
the option of the Holder, on or after the date for repayment), or
(2) reduce the Percentage in principal amount of the outstanding
Securities of any series, the consent of whose Holders is required for any
such amendment or supplemental indenture, or the consent of whose Holders
is required for any waiver (of compliance with certain provisions of this
Indenture or certain defaults hereunder and their consequences) provided
for in this Indenture, or
(3) modify any of the provisions of this Section, or Section 513 or
1013, except to increase any such percentage or to provide that certain
other provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each Outstanding Security affected thereby.
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which shall have been included expressly and solely
for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision , shall be deemed not to affect the rights
under this Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders of Securities under this
Section to approve the particular form of any proposed amendment, supplemental
indenture or waiver, but it shall be sufficient if such Act shall approve the
substance thereof.
The Company may, but shall not be obligated to, offer to any Holder who
consents to such amendment, supplement or waiver, or to all Holders,
consideration for such Holder's or Holders consent to such amendment, supplement
or waiver.
Section 903. Execution of Amendments or Supplemental Indentures.
The Trustee shall sign any amendment, supplement or waiver authorized
pursuant to this Article Nine if the amendment, supplement or waiver does not
adversely affect the rights, duties or immunities of the Trustee. As a condition
to executing, or accepting the additional trusts created by, any waiver,
amendment or supplemental indenture permitted by this Article or the
modifications thereby of the trust created by this Indenture, the Trustee shall
be entitled to receive, and (subject to Section 315 of the Trust Indenture Act)
shall be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such waiver, amendment or supplemental indenture is authorized or
permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such waiver, amendment or supplemental indenture which affects
the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
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Section 904. Effect of Waiver, Amendments and Supplemental Indentures.
Upon the execution of any waiver, amendment or supplemental indenture under
this Article, this Indenture shall be modified in accordance therewith, and such
waiver, amendment or supplemental indenture shall form a part of this Indenture
for all purposes; and every Holder of a Security theretofore or thereafter
authenticated and delivered hereunder shall be bound thereby.
Section 905. Reference in Securities too Supplemental Indentures.
Securities of any series authenticated and delivered after the execution of
any supplemental Indenture pursuant to this Article may (if directed by the
Company, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities of any series so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities of such series.
ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal and any Premium, Interest and
Additional Amounts.
The Company covenants and agrees for the benefit of the Holders of the
Securities of each series that it will duly and punctually pay the principal of,
any premium and interest on and any Additional Amounts with respect to the
Securities of such series in accordance with the terms thereof and this
Indenture.
An installment of principal or interest shall be considered paid on the
date due if the Trustee or Paying Agent (other than the Company) holds on such
date Money designated for and sufficient to pay such installment.
Section 1002. Maintenance of Office or Agency.
The Company shall maintain in each Place of Payment for any series of
Securities an Office or Agency where Securities of such series may be presented
or surrendered for payment, where Securities of such series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities of such series relating thereto
and this Indenture may be served. The Company will give prompt written notice
to tie Trustee of the location, and any change in the location, of such Office
or Agency. If at any time the Company shall fail to maintain any such required
Office or Agency or shall fail to furnish the Trustee with the address
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thereof, such presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office of the Trustee, and the Company hereby
appoints the Trustee as its agent to receive all such presentations, surrenders,
notices and demands.
The Company may also from time to time designate one or more other Offices
or Agencies where the Securities of one or more series may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an Office or Agency
in each Place of Payment for Securities of any series for such purposes. The
Company shall give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other Office or
Agency. Unless otherwise provided in or pursuant to this Indenture (including,
without limitation, Section 307), the Company hereby initially designates the
Place of Payment for each series the City of New York, New York and initially
appoints the Corporate Trust Operations Center of the Trustee as the Office or
Agency for such purpose. Pursuant to Section 301(6) of this Indenture, the
Company may subsequently appoint a place or places in addition to or other than
the City of Chicago, Illinois where such Securities may be payable.
Section 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with respect
to any series of Securities, it shall, on or before each due date of the
principal of, any premium or interest on or Additional Amounts with resect to
any of the Securities of such series, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum of Money sufficient to pay the
principal or any premium, interest or Additional Amounts so becoming due until
such sums shall be paid to such Persons or otherwise disposed of as herein
provided, and shall promptly notify the Trustee of its action or failure so to
act.
Whenever the Company shall have one or more Paying Agents for any series of
Securities, it shall, on or prior to each due date of the principal of, any
premium or interest on or any Additional Amounts with respect to any securities
of such series, deposit with any Paying Agent a sum of Money sufficient to pay
the principal or any premium, interest or Additional Amounts so becoming due,
such sum to be held in trust for the benefit of the Persons entitled thereto,
and (unless such Paying Agent is the Trustee) the Company will promptly notify
the Trustee of its action or failure so to act.
The Company shall cause each Paying Agent for any series of Securities
other than the Trustee to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to the provisions
of this Section, that such Paying Agent shall
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(1) hold all sums held by it for the payment of the principal of, any
premium or interest on or any Additional Amounts with respect to Securities
of such series in trust for the benefit of the Persons entitled thereto
until such sums shall be paid to such Persons or otherwise disposed of as
provided in or pursuant to this indenture;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities of such series) in the making of any
payment of principal, any premium or interest on or any Additional Amounts
with respect to the Securities of such series; and
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this indenture or for any other purpose, pay, or by Company
Order direct any paying Agent to pay, to the Trustee all sums held in trust by
the Company or such paying Agent, such sums to be held by the trustee upon the
same terms as those upon which such sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying
Agent shall be released from all further liability with respect to such Money.
Except as otherwise provided herein or pursuant hereto, any Money deposited
with the Trustee or any Paying Agent, or then held by the Company, in trust for
the payment of the principal of, any premium or interest on or any Additional
Amounts with respect to any Security of any series and remaining unclaimed for
three years after such principal or any such premium or interest or any such
Additional Amounts shall have become due and payable shall be paid to the
Company on Company Request, or (if then held by the Company) shall be discharged
from such trust; and the Holder of such Security shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
Money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, shall at the expense of the Company cause
to be mailed to the Holder of such Security notice that such Money remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such mailing, any unclaimed balance of such Money then
remaining will be repaid to the Company or (if then held by the Company) shall
be discharge from such trust.
Section 1004. Additional Amounts.
If any Securities of a series provide for the payment of Additional
Amounts, the Company agrees to pay to the Holder of any, such Security
Additional Amounts as provided therein. Whenever in
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this Indenture there is mentioned, in any context, the payment of the principal
of or any premium or interest on, or in respect of, any Security of any series
or the net proceeds received on the sale or exchange of any Security of any
series, such mention shall be deemed to include mention of the payment of
Additional Amounts provided by the terms of such series established hereby or
pursuant hereto to the extent that, in such context, Additional Amounts are,
were or would be payable in respect thereof pursuant to such terms, and express
mention of the payment of Additional Amounts (if applicable) in any provision
hereof shall not be construed as excluding Additional Amounts in those
provisions hereof where such express mention is not made.
Except as otherwise provided in or pursuant to this Indenture, if the
Securities of a series provide for the payment of Additional Amounts, at least
10 days prior to the first Interest Payment Date with respect to such series of
Securities (or if the Securities of such series shall not bear interest prior to
Maturity, the first day on which a payment of principal is made), and at least
10 days prior to each date of payment, of principal or interest if there has
been any change with respect to the matters set forth in the below-mentioned
Officers' Certificate, the Company shall furnish to the Trustee and the
principal Paying Agent or Paying Agents, if other than the Trustee, an Officers'
Certificate instructing the Trustee and such Paying Agent or Paying Agents
whether such payment of principal of or interest on the Securities of such
series shall be made to Holders of Securities of such series who are United
States Aliens without withholding for or an account of any tax, assessment or
other governmental charge described in the Securities of such series. If any
such withholding shall be required, then such Officers' Certificate shall
specify by country the amount, if any, required to be withheld on such payments
to such Holders of Securities, and the Company agrees to pay to the Trustee or
such Paying Agent the Additional Amounts required by the terms of such
Securities. The Company covenants to indemnify the Trustee and any Paying Agent
for, and to hold them harmless against, any loss, liability or expense
reasonably incurred without negligence or bad faith on their part arising out of
or in connection with actions taken or omitted by any of them in reliance on any
Officers, Certificate furnished pursuant to this Section.
Section 1005. Corporate Existence.
Subject to Article Eight, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect the corporate
existence, rights (charter and statutory) and franchises of the Company and its
Subsidiaries, and shall comply with all material statutes, rules, regulations
and orders of and restrictions imposed by governmental and administrative
authorities and agencies applicable to the Company and its Subsidiaries;
provided, however, that the foregoing shall not obligate the Company to preserve
any such right or franchise if the Company shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
its
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Subsidiaries and that the loss thereof is not disadvantageous in any material
respect to the Holders.
Section 1006. Maintenance of Properties.
The Company will:
(1) cause its properties and the properties of its Significant
Subsidiaries used or useful in the conduct of the business of the Company and
its Subsidiaries to be maintained and kept in good condition, repair and working
order and supplied with all necessary facilities and equipment and will cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Company may be necessary so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that the foregoing
shall not prevent the Company or a Subsidiary from discontinuing the operation
and maintenance of any of its properties if such discontinuance is, in the
judgment of the Company, desirable in the conduct of its business and not
disadvantageous in any material respect to the Holders; and
(2) take all appropriate steps to preserve, protect and maintain the
trademarks, trade names, copyrights, licenses and permits used in the conduct of
the business of the Company and its Subsidiaries; provided, however, that the
foregoing shall not prevent the Company or a Subsidiary from selling, abandoning
or otherwise disposing of any such trademark, trade name, copyright, license or
permit if such sale, abandonment or disposition is, in the judgment of the
Company, desirable in the conduct of its business and not disadvantageous in any
material respect to any Holder.
Section 1007. Limitation on Restricted Payments.
The Company shall not (i) declare or pay any dividend, either in cash or
property, on any shares of its capital stock (except dividends or other
distributions payable solely in shares of capital stock of the Company, or
warrants, options, or other rights solely to acquire solely capital stock of the
Company) or (ii) purchase, redeem or retire any shares of its capital stock or
any warrants, rights or options to purchase or acquire any shares of its capital
stock (except from employees in connection with the termination of their
employment) or (iii) make any other payment or distribution, either directly or
indirectly through any Subsidiary, in respect of its capital stock (such
dividends, purchases, redemptions, retirements, payments and distributions being
herein collectively called "Restricted Payments,) if, after giving effect
thereto,
(1) an Event of Default would have occurred; or
(2)(A) the sum of (i) such Restricted Payment plus the aggregate
amount of all Restricted Payments made during the period after [September
30, 1996] would exceed (B) the sum of
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(i) $7,500,000 plus (ii) 50% of Consolidated Net Income for the period
commencing [September 30, 1996] and ending on the date of payment of such
Restricted Payment, treated as one accounting period plus (iii) 100% of the
cumulative cash and non-cash proceeds received by the Company from
contributions to capital or the issuance or sale after [September 30, 1996]
of capital stock of the Company or of any warrants, rights or other options
to purchase or acquire its capital stock.
Notwithstanding the foregoing, the Company may make a previously declared
Restricted Payment if at the date of the declaration, such Restricted Payment
would have been permitted under this Section. For purposes of this Section, the
amount of any Restricted Payment payable in property shall be deemed to be the
fair market value of such property as determine by the Board of Directors of the
Company.
Section 1008. Limitation on Indebtedness for Money Borrowed.
The Company will not, nor will it permit any Subsidiary to, create, incur,
assume, guarantee or be liable with respect to any Indebtedness for Money
Borrowed (other than Subordinated Indebtedness if, immediately after giving
effect to any such creation, incurrence, assumption or guarantee (including the
retirement of any existing indebtedness from the proceeds of such additional
Indebtedness for Money Borrowed), the aggregate amount of Indebtedness for Money
Borrowed outstanding would exceed six (6) times the sum of the Company's
Consolidated Net Worth plus Subordinated Indebtedness. For purposes of the
limitation on additional indebtedness set forth in this Section 1008,
Indebtedness for Borrowed Money shall not include the "Warehouse Indebtedness,"
and in calculating the Consolidated Net Worth for purposes of this Section 1008,
Warehouse Indebtedness shall not be included as a liability.
Section 1009. Limitation on Subordinated Indebtedness.
The Company will not, nor will it permit any Subsidiary to, create, incur,
assume, guarantee or be liable with respect to any Subordinated Indebtedness if
immediately after giving effect to any such creation, incurrence, assumption or
guarantee (including the retirement of any existing indebtedness from the
proceeds of such Subordinated Indebtedness), the aggregate amount of
Subordinated Indebtedness outstanding would exceed the Company's Consolidated
Net Worth.
Section 1010. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged, before
the same shall become delinquent, (i) all material taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary and (ii)
all material lawful claims for labor materials and supplies which, if unpaid,
might by law become a lien upon the property of the Company
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or any Subsidiary; provided, however, that the Company shall not be required to
pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim whose amount, applicability or validity is being contested in
good faith by appropriate proceedings.
Section 1011. Books and Records.
The Company shall, and shall cause each Subsidiary to, at all times keep
proper books of record and account in which proper entries shall be made in
accordance with generally accepted accounting principles and, to the extent
applicable, regulatory accounting principles.
Section 1012. Statement by Officers as to Default.
(a) The Company shall deliver to the Trustee, within 120 days after the
end of each fiscal year of the Company ending after the date hereof, an
Officers' Certificate, stating whether or not to the best knowledge of the
Company's President or Chief Financial Officer thereof the Company is in default
in the performance and observance of any of the terms, provisions and conditions
of this Indenture, setting forth the arithmetical computations required to show
compliance with the provisions of Sections 1007 and 1008 during the previous
fiscal year, and, if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.
(b) The Company shall deliver to the Trustee, within 30 days after the end
of each fiscal quarter of the Company ending after the date hereof, an Officers'
Certificate, if and only if, to the best knowledge of the signers thereof the
Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture, specifying all such defaults and
the nature and status thereof.
(c) The Company shall, so long as any of the Securities are outstanding
deliver to the Trustee, within five days after the occurrence thereof, written
notice of any event which after notice or lapse of time or both would become an
Event of Default pursuant to Clause (4) of Section 501.
Section 1013. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any term,
provision or condition set forth in Sections 1005 through 1010, 1014 and 1015
with respect to the Securities of any series if before the time for such
compliance the Holders of at least a majority in principal amount of the
Outstanding Securities of such series, by Act of such Holders, either shall
waive such compliance in such instance or generally shall have waived compliance
with such term, provision or condition, but no such waiver shall extend to or
affect such term, provision, or condition except to the extent so expressly
waived, and, until such waiver shall become effective, the obligations of the
Company and the duties of the
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Trustee in respect of any such term, provision or condition shall remain in full
force and effect.
Section 1014. Limitation on Ranking of Future Indebtedness.
The Company will not, directly or indirectly, incur, create, assume or
guarantee any Indebtedness for Money Borrowed which is not Senior Indebtedness
(other then Subordinated Indebtedness that is pari passu or subordinate in right
of payment to the Securities).
Section 1015. Subsidiaries that Own Finance Receivables.
The Company will not organize and own directly or indirectly the voting
Stock of any Person that directly or indirectly owns or holds finance
receivables (with an aggregate principal amount excess of $1,000,000) originated
by the Company or any Subsidiary unless (i) the net income and net worth of such
Person is accounted for as a consolidated subsidiary, of the Company in
accordance with the generally accepted accounting principles, (ii) the Company
owns directly or indirectly at least 80% of the outstanding Voting Stock of such
Person and (iii) the Company owns directly or indirectly stock or equity
interests in such Person having a value equal to at least 80% of the total value
of the stock or equity interests in such Person. For purposes of clause (iii),
"stock" or "equity interests" shall not include preferred stock or any similar
equity interest which (A) is not entitled to vote except as required by law, (B)
is limited and preferred as to dividends or distributions and does not
participate in the economic growth of the Person to any significant extent, (C)
has, to the extent provided for, redemption rights and liquidation rights which
do not exceed the issue price of such stock or equity interests (except for a
reasonable redemption or liquidation premium), and (D) is not convertible into
another class of stock or equity interest.
Section 1016. Limitations on Transactions with Affiliates.
The Company shall not, and shall not permit any of its Subsidiaries to,
enter into permit to exist any transaction (or series of related transactions),
including, without limitation, any loan, advance, guarantee or capital
contribution to, or for the benefit of, or any sale, purchase, lease, exchange
or other disposition of any property or the rendering of any service, or any
other direct or indirect payment, transfer or other disposition (a
"Transaction"), involving payments, with any Affiliate of the Company, on terms
and conditions less favorable to the Company or such Subsidiary, as the case May
be, than would be available at such time in a comparable Transaction in arm's
length dealings with an unrelated Person as determined by the Board of
Directors, such approval to be evidenced by a Board Resolution.
The provisions of the immediately preceding paragraph will not apply to:
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(i) Restricted Payments otherwise permitted pursuant to this
Indenture, or
(ii) fees and compensation (including amounts paid pursuant to
employee benefit plans) paid to, and indemnity provided on behalf of,
officers, directors, employees or consultants of the Company or any
Subsidiary, as determined by the Board of Directors or the senior
management thereof in the exercise of their reasonable business judgment;
or
(iii) payments for goods and services purchased in the ordinary course
of business on an arm's-length basis; or
(iv) Transactions which do not exceed $200,000; or
(v) Transactions between or among any of the Company and its wholly
owned subsidiaries.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article.
Redemption of Securities of any series at the option of the Company as permitted
or required by the terms of such Securities shall be made in accordance with the
terms of such Securities and (except as otherwise provided herein or pursuant
hereto) this Article.
Section 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced by
or pursuant to a Board Resolution. In case of any redemption at the election of
the Company of the Securities of any series with the same issue date, interest
rate, Stated Maturity and other terms, the Company shall, at least 45 days prior
to the Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Securities of such series to be redeemed.
Section 1103. Selection by Trustee of Securities to be Redeemed.
If less than all the Securities of any series with the same issue date,
interest rate, Stated Maturity and other terms are to be redeemed, the
particular Securities to be redeemed shall be selected not less than 30 days
prior to the Redemption Date by the Trustee from the Outstanding Securities of
such series not previously called for redemption, in compliance with the
requirements of the principal national securities exchange, if any, on which the
Securities are listed, or, if the Securities are not listed by lot or in such
other method as the Trustee
69
shall deem fair and appropriate and which may provide for the selection for
redemption of portions of the principal amount of Securities of such series;
provided, however, that no such partial redemption shall reduce the portion of
the principal amount of a Security of such series not redeemed to less than the
minimum denomination for a Security of such series established herein or
pursuant hereto.
The Trustee shall promptly notify the Security Registrar (if other than
itself) and the Company in writing of the Securities selected for redemption
and, in the case of any Securities selected for partial redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal of such Securities which has been or is to be redeemed.
Section 1104. Notice of Redemption.
Notice of redemption shall be given in the manner provided in Section 106,
not less than 30 nor more than 60 days prior to the Redemption Date, unless a
shorter period is specified in the Securities to be redeemed, to the Holders of
Securities to be redeemed. Failure to give notice by mailing in the manner
herein provided to the Holder of any Securities designated for redemption as a
whole or in part, or any defect in the notice to any such Holder, shall not
affect the validity of the proceedings for the redemption of any other
Securities or portion thereof.
Any notice that is mailed to the Holder of any Securities in the manner
herein provided shall be conclusively presumed to have been duly given, whether
or not such Holder receives the notice.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all Outstanding Securities of any series are to be
redeemed, the identification (and, in the case of partial redemption, the
principal amount) of the particular Security or Securities to be redeemed,
(4) in case any Security is to be redeemed in part only, that on and
after the Redemption Date, upon surrender of such Security, the Holder of
such Security will receive, without charge, a new Security or Securities of
authorized denominations for the principal amount thereof remaining
unredeemed,
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(5) that, on the Redemption Date, the Redemption Price shall become
due and payable upon each such Security or portion thereof to be redeemed
and if applicable, that interest thereon shall cease to accrue on and after
said date,
(6) the place or places where such Securities must be surrendered for
payment of the Redemption Price and any accrued interest and Additional Amounts
pertaining thereto,
(7) that the redemption is for a sinking fund, if such is the case,
and
(8) the CUSIP number of such Securities, if any (or any other numbers
used by a Depository to identify such Securities).
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name of the Company.
Section 1105. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
Money sufficient to pay the Redemption Price of, and (except if the Redemption
Date shall be an Interest Payment Date) any accrued interest on and Additional
Amounts with respect to, all the Securities or portions thereof which are to be
redeemed on that date.
Section 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption a Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with any accrued
interest and Additional Amounts to the Redemption Date; provided, however, that
installments of interest on Securities whose Stated Maturity is on or prior to
the Redemption Date shall be payable to the Holders of such Securities, or one
or more Predecessor Securities, registered as such at the close of business on
the Regular Record Dates therefor according to their terms and the provisions of
Section 307.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal and any
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premium, until paid, shall bear interest from the Redemption Date at the rate
prescribed therefor in the Security.
Section 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered at
any Office or Agency for such Security (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute and the Trustee shall
authenticate and deliver to the Holder of such Security, without service charge,
a new Security or Securities of the same series, containing identical terms and
provisions, of any authorized denomination as requested by such Holder in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered. If a Security in global form is
so surrendered, the Company shall execute, and the Trustee shall authenticate
and deliver to the Depository for such Security in global form as shall be
specified in the Company Order with respect thereto to the Trustee, without
service charge, a new Securities in global form in a denomination equal to and
in exchange for the unredeemed portion of the principal of the Security in
global form so surrendered.
ARTICLE TWELVE
SINKING FUNDS
Section 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of a series, except as otherwise permitted or
required by any form of Security of such series issued pursuant to this
Indenture.
The minimum amount of any sinking fund payment provided for by the terms of
Securities of any series is herein referred to as a "mandatory sinking fund
payment", and any payment in excess of such minimum amount provided for by the
terms of Securities of such series is herein referred to as an "optional sinking
fund payment". If provided for by the term of Securities of any series, the cash
amount of any sinking fund payment may be subject to reduction as provided in
Section 1202. Each sinking fund payment shall be applied to the redemption of
Securities of any series as provided for by the terms of Securities of such
series.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company may, in satisfaction of all or any part of any sinking fund
payment with respect to the Securities of any series
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to be made pursuant to the terms of such Securities (1) deliver Outstanding
Securities of such series (other than any of such Securities previously called
for redemption or any of such Securities in respect of which cash shall have
been released to the Company) and (2) apply as a credit Securities of such
series which have been redeemed either at the election of the Company pursuant
to the terms of such series of Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities or through the terms of Article Thirteen, provided that such series
of Securities have not been previously so credited. Such Securities shall be
received and credited for such purpose by the Trustee at the Redemption Price
specified in such Securities for redemption through operation of the sinking
fund and the amount of such sinking fund payment shall be reduced accordingly.
If as a result of the delivery or credit of Securities of any series in lieu of
cash payments pursuant to this Section 1202, the principal amount of Securities
of such series to be redeemed in order to exhaust the aforesaid cash payment
shall be less than $100,000, the Trustee need not call Securities of such series
for redemption, except upon Company Request, and such cash payment shall be held
by the Trustee or a Paying Agent and applied to the next succeeding sinking fund
payment, provided, however, that the Trustee or such Paying Agent shall at the
request of the Company from time to time pay over and deliver to the Company any
cash payment so being held by the Trustee or such Paying Agent upon delivery by
the Company to the Trustee of Securities of that series purchased by the Company
having an unpaid principal amount equal to the cash payment requested to be
released to the Company.
Section 1203. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date for any
series of Securities, the Company shall deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing mandatory sinking fund
payment for that series pursuant to the terms of that series, the portion
thereof, if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and crediting of
Securities of that series pursuant to Section 1202, and the optional amount, if
any, to be added in cash to the next ensuing mandatory sinking fund payment, and
will also deliver to the Trustee any Securities to be so credited and not
theretofore delivered. If such Officers' Certificate shall specify an optional
amount to be added in cash to the next ensuing mandatory sinking fund payment,
the Company shall thereupon be obligated to pay the amount therein specified.
Not less than 30 days before each such sinking fund payment date the Trustee
shall select the Securities to be redeemed upon such sinking fund payment date
in the manner specified in Section 1103 and cause notice of the redemption
thereof to be given in the name of and at the expense of the Company in the
manner provided in Section 1104. Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the manner
stated in Sections 1106 and 1107.
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ARTICLE THIRTEEN
REPAYMENT AT THE OPTION OF HOLDERS
Section 1301. Applicability of Article.
Securities of any series which are repayable at the option of the Holders
thereof before their Stated Maturity shall be repaid in accordance with the
terms of the Securities of such series and (except as otherwise provided herein
or pursuant hereto) this Article. The repayment of any principal amount of
Securities pursuant to such option of the Holder to require repayment of
Securities before their Stated Maturity, for purposes of Section 309, shall not
operate as a payment, redemption or satisfaction of the indebtedness represented
by such Securities unless and until the Company, at its option, shall deliver or
surrender the same to the Trustee with a directive that such Securities be
canceled. Notwithstanding anything to the contrary contained in this Section
1301, in connection with and repayment of Securities, the Company may arrange
for the purchase of any Securities by an agreement with one or more investment
bankers or other purchasers to purchase such Securities by paying to the Holders
of such Securities on or before the close of business on the Repayment Date an
amount not less than the Repayment Price payable by the Company on repayment of
such Securities, and the obligation of the Company to pay the Repayment Price of
such Securities shall be satisfied and discharged to the extent such payment is
so paid by such purchasers.
Section 1302. Repayment Opinion upon Death of Xxxxxx.
(a) If provided for by the terms of any Securities of any series, then
upon the death of any Holder of Securities of such series, and upon the further
receipt by the Company or the Trustee of a written request for repayment and
satisfaction of the conditions set forth in subsection (b) below, the Company
shall be required to pay, in accordance with the terms of this Article, the
Repayment Price (excluding any premium) of, and (except if the Repayment Date
shall be an Interest Payment Date) any accrued interest on and Additional
Amounts with respect to, all or such portion (which portion shall be an integral
multiple of $1,000 in excess of the minimum authorized denomination of the
applicable series of Securities) of the Security or Securities held by the
deceased Holder at the date of his death as requested, provided that the Company
shall not be required to make repayment payments aggregating more than $250,COO
in principal amount (plus accrued interest and Additional Amounts) in any fiscal
year on a Security or Securities held by any one deceased Holder or aggregating
more than such principal amount as shall be specified by the terms of the
Securities of such series (plus accrued interest and Additional Amounts) in any
fiscal year on Securities held by any number of deceased Holders (the "Maximum
Annual Repayment Amount"). Subject to subsection (b)
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below, repayment of such Securities shall be made in the order in which requests
therefor are received (subject to the Maximum Annual Repayment Amount) within 60
days following receipt by the Company or the Trustee of the following:
(1) a written receipt for repayment of the Security or Securities
signed by a duly authorized representative of the Holder, which request
shall set forth the name of the deceased Holder, the date of death of the
deceased Xxxxxx, and the principal amount of the Security or Securities to
be repaid; and
(2) the certificates representing the Security or Securities to be
repaid, and
(3) evidence satisfactory to the Company and the Trustee of the death
of such deceased Xxxxxx and the authority of the representative to such
extent as may be required by the Trustee and the Company
Securities not repaid in any fiscal year because the maximum Annual
Repayment Amount has already been met may be held by the Trustee at the request
of the authorized representative of the deceased Holder and repaid in subsequent
years in the order in which such Securities are received.
(b) A Security or Securities held by the deceased Holder shall not be
entitled to repayment pursuant to this Section 1302 unless all of the following
conditions are met:
(1) the Securities to be repaid shall have been registered on the
Security Register in the name of the deceased Holder since the issue date
of such series of Securities or for a period of at least six months prior
to the date of the deceased Xxxxxx's death, whichever is less; and
(2) the Company or the Trustee shall have received a written request
for repayment within one year after the date of the deceased Xxxxxx' death
or, in the case of requests for a subsequent repayment of a Security or
Securities held by such deceased Xxxxxx, within one year after any such
preceding request; and
(3) the Company shall not, after giving effect to such repayment,have
made repayment payments aggregating more than the Maximum Annual Repayment
Amount within the then current fiscal year; and
(4) the Company shall not be subject to any law, regulation,
agreement or administrative directive preventing such repayment.
(c) Authorized representatives of a Holder shall include the following
executors, administrators or other legal
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representatives of an estate; trustees of a trust; joint owners of Securities
owned in joint tenancy or, tenancy by the entirety; custodians; conservators;
guardians; attorneys-in-fact; and other Persons generally recognized as having
legal authority to act on behalf of another.
(d) For purposes of his Section, the death of a Person owning a Security
or Securities in joint tenancy or tenancy by the entirety with another or others
shall be deemed the death of the Holder of the Security or Securities, and the
entire principal amount of the Security or Securities so held shall be subject
to repayment, plus accrued interest thereon to the Repayment Date and Additional
Amounts with respect thereto, in accordance with the provisions of this Article
for purpose of this Section, the death of a Person owing a Security or
Securities by tenancy common shall be deemed the death of a Holder of Security
or securities only with respect to the deceased Holder's interest in the
Security or Securities so held by tenancy in common; except that in the event a
Security or Securities are held by husband and wife as tenants in common, the
death of either shall be deemed the death of the Holder of the Security or
Securities, and the entire principal amount of the Security or Securities so
held shall be subject to repayment in accordance with the provisions of this
Article. A Person who, during such Person's lifetime, was entitled to
substantially all of the beneficial interests of ownership of Securities shall,
upon such Person's death, be deemed the Holder thereof for purposes of this
Section, regardless of the registered holder, if such beneficial interest can be
established to the satisfaction of the Trustee. Such beneficial interest shall
be deemed to exist in typical cases of nominee ownership, ownership under the
Uniform Transfers (or Gifts) to Minors Act, community property or other joint
ownership arrangements between a husband and wife, and trust arrangements where
one Person has substantially all of the beneficial ownership interests in
Securities during such Person's lifetime. Beneficial interests shall include
the power to sell, transfer or otherwise dispose of Securities and the right to
receive the proceeds therefrom, as well as principal thereof, interest thereon
and Additional Amounts with respect thereto.
(e) If Securities of a Series are issuable in global form (i.e., in the
name of the nominee of a Depository for purposes of book-entry transfer) and
such Securities authorize repayment upon the death of a Holder, the Company or
the Trustee may adopt appropriate procedures to allow beneficial owners of
Securities to obtain payment in accordance with the requirements of the
Depository in the event of a request for repayment of the Securities pursuant to
this section.
Section 1303. Redemption Upon Special Redemption Event.
In the event that there shall occur a Special Redemption Event with respect
to the Company, then each Holder shall have the right, at the Holder's option,
to require the Company to
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redeem such Holder's Securities, in whole or in part (provided the principal
amount of such part is $1,000 or any integral multiple thereof) on the Repayment
Date that is seventy-five (75) days after the occurrence of the Special
Redemption Event at a redemption price in cash equal to 101% of the principal
amount thereof or portion thereof plus accrued but unpaid interest to the date
of redemption.
Forty (40) days after the occurrence of a Special Redemption Event the
Company promptly, but in any event within three (3) Business Days after
expiration of such 40-day period, shall give notice to the Trustee, who shall
promptly, but in any event within five (5) days of receipt of notice from the
Company, notify all Holders, of the occurrence of such Special Redemption Event,
of the date before which a Holder must notify the Trustee of such Holder's
intention to exercise the redemption option (which date shall be not more than
three (3) Business Days prior to the Repayment Date) and of the procedure which
such Holder must follow to exercise such right. To exercise the redemption, the
Holder must deliver to the Trustee on or before the close of business on the
Repayment Date: (i) written notice of such Xxxxxx's redemption election pursuant
to this Section 1303, in form satisfactory to the Trustee, signed by the
registered Holder(s) or his duly authorized representative and (ii) the Security
or Securities to be redeemed, free and clear of any liens or encumbrances of any
kind.
In the case of any securities which are presented for redemption in part
only, upon such redemption the Company shall execute and the Trustee shall
authenticate and deliver to or on the order of the Holder of such Securities,
without service charge, a new Security or Securities, of any authorized
denomination or denominations as requested by such Holder, in aggregate
principal amount equal to the unredeemed portion of the principal of the
Securities so presented.
Section 1304. Deposit of Repayment Price.
Within 30 days after the receipt by the Company or the Trustee of any
request for repayment of a Security or Securities or any portion thereof duly
made pursuant to Section 1302 or 1303, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
Money sufficient to pay the Repayment Price of, and (except if the Repayment
Date shall be an Interest Payment Date) any accrued interest on any Additional
Amounts with respect to, all the Securities or portions thereof which are to be
repaid on that date.
Section 1305. Securities Payable on Repayment Date.
A written request having been made as aforesaid, the Security or Securities
so to be repaid shall, on the Repayment Date, become due and payable at the
Repayment Price, and from and
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after such date (unless the Company shall default in the payment of the
Repayment Price and accrued interest) such Securities shall cease to bear
interest. Upon surrender of any such Security for repayment in accordance with
said request, such Security shall be paid by the Company at the Repayment Price,
together with any accrued interest and Additional Amounts to the Repayment Date;
provided, however, that installments of interest on Securities whose Stated
Maturity is on or prior to the Repayment Date shall be payable to the Holders
of such Securities, or one or more Predecessor Securities, registered as such at
the close of business on the Regular Record Dates therefor according to their
terms and the provisions of Section 307.
If any Security to be repaid shall not be so paid upon surrender thereof
for repayment the principal and any premium, until paid, shall bear interest
from the Repayment Date at the rate prescribed therefor in the Security.
Section 1306. Securities Repaid in Part.
Any Security which is to be repaid only in part shall be surrendered at any
Office or Agency for such Security (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by, the Holder thereof
or his attorney duly authorized in writing), and the Company shall execute and
the Trustee shall authenticate and deliver to the Holder of such Security,
without service charge, a new Security or Securities of the same series,
containing identical terms and provisions, of any authorized denomination as
requested by such Holder in aggregate principal amount equal to and in exchange
for the unpaid portion of the principal of the Security so surrendered. If a
Security in global form is so surrendered, the Company shall execute, and the
Trustee shall authenticate and deliver to the Depository for such Security in
global form as shall be specified in the Company Order with respect thereto to
the Trustee, without service charge, a new Security in global form in a
denomination equal to and in exchange for the unpaid portion of the principal of
the Security in global form in surrendered.
ARTICLE FOURTEEN
SUBORDINATION OF SECURITIES
Section 1401. Securities Subordinated to Senior Indebtedness.
(a) The Company covenants and agrees, and each Holder of Securities, by
his acceptance thereof, likewise covenants and agrees, and for purposes of
Section 508 consents, that the indebtedness represented by the Securities and
the payment of the principal of and interest on and Additional Amounts with
respect
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to each and all of the Securities is hereby expressly subordinated, to the
extent and in the manner, hereinafter set forth, in right of payment to the
prior payment in full of all Senior Indebtedness and that all Securities issued
hereunder shall rank pari passu with debt securities issued pursuant to the 1995
Indenture.
(b) The Trustee, the Company and the Holders of Securities hereby agree
that, until all Senior Indebtedness has been paid in full, the Holders of
Securities shall be permitted to retain only the following payments of principal
and interest paid by the Company in respect of Securities (all such payments
being referred to herein as "Permitted Payments"), and all such payments that
are not Permitted Payments will be turned over by the Trustee or the Holders of
Securities to the holder or holders of Senior indebtedness or any agent thereof
or (a "Senior Agent") for the benefit of the holder or holders of Senior
Indebtedness
(1) principal payment of the Securities, whether (A) at the Stated
Maturity, (B) at the Company's option as provided in Article Eleven
provided that the holder or holders of Senior Indebtedness or any Senior
Agent has received written notice from the Company or the Trustee not later
than 45 days prior to a Redemption Late, (C) pursuant to the operation of
the sinking fund provisions of Article Twelve, or (D) as a result of the
occurrence of a Special Redemption Event as provided in Section 1303
provided that the holder or holders of Senior Indebtedness or any Senior
Agent has received written notice from the Company or the Trustee of the
Special Redemption Event not later than 40 days after the occurrence of the
Special Redemption Event; provided that all such principal payments are
subject to the restrictions set forth in Section 1401(c) hereof;
(2) payments of interest in respect of the Securities so long as no
default has occurred and is then continuing with respect to the payment of
principal of or interest on the Senior Indebtedness; for such purposes, any
such default which has been cured by payment or which has been waived,
shall not be continuing; and
(3) principal payment of the Securities as a result of death of one
or more Holders as provided in Section 1302 prior to the date on which any
of the Senior Indebtedness is accelerated or the date on which any holder
or holders of not less than 51% in principal amount of the outstanding
Senior Indebtedness or any Senior Agent exercises any judicial or
non-judicial remedy with respect to any collateral securing such Senior
Indebtedness.
(c) From and after the receipt by the Trustee of a written notice (the
"Default Notice") from the holder or holders of not less than 51% in principal
amount of the outstanding Senior Indebtedness or any Senior Agent specifying
that any default in the payment of any obligation on any Senior Indebtedness
when
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due, whether at the stated maturity of any such payment or by declaration of
acceleration, call for redemption, mandatory repurchase, payment or prepayment
or otherwise (a "Senior Payment Default") has occurred, the Company may not make
any principal payments described in Section 1401(b)(1) to the Holders of
Securities and neither the Trustee nor the Holders of not less than 25% in
principal amount of the Outstanding Securities of any series may accelerate the
Maturity of such series as provided in Section 502, until the first to occur of
the following:
(1) such Senior Payment Default is cured, or
(2) such Senior Payment Default is waived by the holders of such
Senior Indebtedness or the senior Agent, or
(3) the expiration of 180 days after the date the Default Notice is
received by the Trustee, if the maturity of such Senior Indebtedness has
not been accelerated at such time or the holder or holder's of not less
than 51% in principal amount of the outstanding Senior Indebtedness or any
Senior Agent has not exerciser any judicial or non-judicial remedy with
respect to any collateral securing such Senior Indebtedness at such time,
and the provisions of this Article Fourteen otherwise permit the payment at
such time.
Upon payment in full of the Senior Indebtedness, payment of principal may be
made to the Holders of Securities.
(d) Upon a payment or distribution to creditors of the Company in a
liquidation, dissolution, or winding up of the Company or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Company or its property or an assignment for the benefit of Creditors or any
marshalling of the Company's assets and liabilities,
(1) the holders of the Senior Indebtedness shall be entitled to
receive payment of the full amount of the Senior Indebtedness before the
Holders of any of the Securities are entitled to receive any payment on
account of the principal of, interest or premium on or Additional Amounts
with respect to the indebtedness evidenced by the Securities; and
(2) any payment by, or distribution of assets of, the Company of any
kind or character, whether in cash, property or securities (other than
securities of the Company as reorganized or readjusted or securities of the
Company or any other corporation provided for by a plan of reorganization
or readjustment the payment of which is subordinate, at least to the extent
provided in his Section 1401 with respect to the Securities, to the payment
of all Senior indebtedness, provided that the right of the holders of
Senior Indebtedness are not impaired by such reorganization or
readjustment), to which the Holders of any of the Securities or the Trustee
would be entitled except for the provisions of this Section 1401 shall be
paid or delivered by the Person making such
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payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holder or holders of
Senior Indebtedness or any Senior Agent, ratably according to the aggregate
amounts remaining unpaid on account of the Senior Indebtedness held or
represented by each, to the extent necessary to make payment in full of all
Senior Indebtedness remaining unpaid after giving effect to any concurrent
payment or distribution to the holders of such Senior Indebtedness, before
any payment or distribution is made to the Holders of the indebtedness
evidenced by the Securities or to the Trustee under this indenture; and
(3) in the event, notwithstanding the foregoing, any payment by, or
distribution of assets of, the Company of any kind or character, whether in
cash, property or securities (other than securities of the Company as
reorganized or readjusted or securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment the
payment of which is subordinate, at least to the extent provided in this
Section 1401 with respect to the Securities, to the payment of all Senior
Indebtedness, provided that the rights of the holders of Senior
Indebtedness are not impaired by such reorganization or readjustment),
shall be received by the Trustee or the Holders of any of the Securities
before all Senior Indebtedness is paid in full, such payment or
distribution shall be paid over to the holder or holders of such Senior
Indebtedness or any Senior Agent, ratably as aforesaid, for application to
the payment of all Senior Indebtedness remaining unpaid until all such
Senior Indebtedness shall have been paid in full, after giving effect to
any concurrent payment or distribution to the holders of such Senior
Indebtedness.
(e) The Holders and the Trustee acknowledge that the holders of Senior
Indebtedness and the Holders of Securities, respectively, are entitled to
exercise certain rights and powers with respect to the Company from time to
time, whether before or after an occurrence of an Event of Default, and the
exercise of any such right or power by one creditor may preclude the exercise of
a similar right or power by one or more other creditors (any such right or power
being herein called an "Exclusive Power"). To the extent that any holder or
holders of Senior Indebtedness or any Senior Agent actually exercises any
Exclusive Power, then the Trustee and the Holders of Securities agree to refrain
from exercising any substantially similar Exclusive Power to the extent
necessary to permit the holders of Senior Indebtedness to benefit from their
actions.
(f) No amendment, modification, extension, replacement, restatement or
substitution of the Senior Indebtedness, or of any agreement or note now or
hereafter in effect pertaining to such Senior Indebtedness, shall nullify,
impair, limit, alter or modify the provisions of Article Fourteen of this
Indenture.
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(g) For purposes of this Section 1401, Senior Indebtedness shall include
all fees, expenses and costs incurred by or on behalf of the holder or holders
of the Senior Indebtedness or the Senior Agent in connection with the Senior
Indebtedness.
(h) Notices to holders of Senior Indebtedness shall be made to each holder
of Senior Indebtedness or, if holders of Senior Indebtedness have appointed a
Senior Agent, then to such Senior Agent, and shall be made in the manner
specified in the document evidencing such holder's Senior Indebtedness if such a
manner is so specified therein.
Section 1402. Subrogation.
Subject to the payment in full of all Senior Indebtedness, the Holders of
the Securities shall be subrogated to the rights of the holders of such Senior
Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to such Senior Indebtedness until all
amounts owing on the Securities shall be paid in full, and, as between the
Company, its creditors other than holders of Senior Indebtedness, and the
Holders of the Securities, no such payment or distribution made to the holders
of Senior Indebtedness by virtue of this Article which otherwise would have been
made to the Holders of the Securities shall be deemed to be a payment by the
Company on account of the Senior Indebtedness, it being understood that the
provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders of the Securities, on the one hand,
and the holders of Senior Indebtedness, on the other hand.
Section 1403. Obligations of Company Unconditional.
Nothing contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as between the Company, its creditors
other than the holders of Senior Indebtedness, and the Holders of the
Securities, the obligations of the Company, which are absolute and
unconditional, to pay to the Holders of the Securities the principal of and
interest on and Additional Amounts with respect to the Securities as and when
the same shall become due and parable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders of the Securities
and creditors of the Company other than the holders of Senior Indebtedness, nor
shall anything herein or therein prevent the Trustee or the Holder of any
Security from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under this Article
of the holders of senior Indebtedness in respect of cash, property or securities
of the Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article, the Trustee and the Holders of the Securities shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction in
which any such
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dissolution, winding up, liquidation or reorganization proceeding affecting the
affairs of the Company is pending or upon a certificate of the trustee in
bankruptcy, receiver, assignee for the benefit of creditors, liquidating trustee
or agent or other person making any payment or distribution, delivered to the
Trustee or to the Holders of the Securities, for the purpose of ascertaining the
persons entitled to participate in such payment or distribution, the holders of
the Senior Indebtedness and other indebtedness of the Company, the amount
thereof or payable thereon, the amount paid or distributed thereon and all other
facts pertinent thereto or to this Article.
Section 1404. Effectuation of Subordination by Trustee.
Each Holder of Securities, by his acceptance thereof, authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes.
Section 1405. Knowledge of Trustee.
Notwithstanding the provision of this Article or any other provisions of
this Indenture, the Trustee shall not be deemed to owe any fiduciary duty to the
Holders of Senior Indebtedness and shall not be charged with knowledge of the
existence of any facts which would prohibit the making of any payment of moneys
to or by the Trustee, or the taking of any other action by the Trustee, unless
and until the Trustee shall have received written notice thereof from the
Company, any Holder of Securities, any Paying Agent of the Company or the holder
or representative of any class of Senior Indebtedness.
Section 1406. Trustee May Hold Senior Indebtedness.
The Trustee shall be entitled to all the rights set forth in this Article
with respect to any Senior Indebtedness at the time held by it, to the same
extent as any other holder of Senior Indebtedness, and nothing in this Indenture
shall deprive the Trustee of any of its right as such holder.
Section 1407. Rights of Holders of Senior Indebtedness Not Impaired.
No right of any present or future holder of any Senior Indebtedness to
enforce the subordination provisions herein shall at any time or in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any non-compliance by the Company with the terms, provisions and
covenants of this Indenture, regardless of any knowledge thereof any such holder
may have or be otherwise charged with.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but
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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 Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed, all
as of the day and year first above written.
[SEAL] CONSUMER PORTFOLIO SERVICES, INC.
Attest:
By:--------------------- By:------------------------------
Name: Name:
Title: Title:
[SEAL] BANKERS TRUST COMPANY,
as Trustee
Attest:
By:--------------------- By:------------------------------
Name: Name:
Title: Title:
