EXHIBIT 4.3
--------------------------------------------------------------------------------
GREATER ATLANTIC FINANCIAL CORP.
AND
WILMINGTON TRUST COMPANY, AS INDENTURE TRUSTEE
INDENTURE
_____% CONVERTIBLE JUNIOR SUBORDINATED DEBENTURES [DUE 2031]
Dated as of _________ ___, 2001
--------------------------------------------------------------------------------
TABLE OF CONTENTS
PAGE
----
ARTICLE I DEFINITIONS........................................................................... 2
Section 1.1 Definitions of Terms.................................................................. 2
ARTICLE II ISSUE, DESCRIPTION, TERMS, CONDITIONS, REGISTRATION AND EXCHANGE OF THE DEBENTURES....11
Section 2.1 Designation and Principal Amount......................................................11
Section 2.2 Maturity..............................................................................11
Section 2.3 Form and Payment......................................................................11
Section 2.4 [Intentionally Left Blank]............................................................12
Section 2.5 Interest..............................................................................12
Section 2.6 Execution and Authentications.........................................................12
Section 2.7 Registration of Transfer and Exchange.................................................13
Section 2.8 Temporary Debentures..................................................................14
Section 2.9 Mutilated, Destroyed, Lost or Stolen Debentures.......................................15
Section 2.10 Cancellation..........................................................................16
Section 2.11 Benefit of Indenture..................................................................16
Section 2.12 Authenticating Agent..................................................................16
ARTICLE III REDEMPTION OF DEBENTURES..............................................................17
Section 3.1 Redemption............................................................................17
Section 3.2 Special Event Redemption..............................................................17
Section 3.3 Optional Redemption by Company........................................................18
Section 3.4 Notice of Redemption..................................................................18
Section 3.5 Payment Upon Redemption...............................................................19
Section 3.6 No Sinking Fund.......................................................................20
ARTICLE IV CONVERSION OF DEBENTURES..............................................................20
Section 4.1 Conversion Rights.....................................................................20
Section 4.2 Conversion Procedures.................................................................21
Section 4.3 Conversion Ratio Adjustments..........................................................23
Section 4.4 Reclassification, Consolidation, Merger or Sale of Assets.............................27
Section 4.5 Notice of Adjustments of Conversion Ratio.............................................27
Section 4.6 Prior Notice of Certain Events........................................................28
Section 4.7 Certain Defined Terms.................................................................29
Section 4.8 Dividend or Interest Reinvestment Plans...............................................29
Section 4.9 Certain Additional Rights.............................................................29
Section 4.10 Trustee Not Responsible for Determining Conversion Ratio or Adjustments...............30
PAGE
----
ARTICLE V EXTENSION OF INTEREST PAYMENT PERIOD..................................................30
Section 5.1 Extension of Interest Payment Period..................................................30
Section 5.2 Notice of Extension...................................................................31
Section 5.3 Limitation on Transactions............................................................32
ARTICLE VI PARTICULAR COVENANTS OF THE COMPANY...................................................32
Section 6.1 Payment of Principal and Interest.....................................................32
Section 6.2 Maintenance of Agency.................................................................32
Section 6.3 Paying Agents.........................................................................33
Section 6.4 Appointment to Fill Vacancy in Office of Trustee......................................34
Section 6.5 Compliance with Consolidation Provisions..............................................34
Section 6.6 Limitation on Transactions............................................................34
Section 6.7 Covenants as to the Trust.............................................................35
Section 6.8 Covenants as to Purchases.............................................................35
Section 6.9 Waiver of Usury, Stay or Extension Laws...............................................35
ARTICLE VII DEBENTUREHOLDERS' LISTS AND REPORTS BY THE COMPANY
AND THE TRUSTEE.......................................................................36
Section 7.1 Company to Furnish Trustee Names and Addresses of Debentureholders....................36
Section 7.2 Preservation of Information Communications with Debentureholders......................36
Section 7.3 Reports by the Company................................................................36
Section 7.4 Reports by the Trustee................................................................37
ARTICLE VIII REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS
ON EVENT OF DEFAULT...................................................................37
Section 8.1 Events of Default.....................................................................37
Section 8.2 Collection of Indebtedness and Suits for Enforcement by Trustee.......................39
Section 8.3 Application of Moneys Collected.......................................................40
Section 8.4 Limitation on Suits...................................................................41
Section 8.5 Rights and Remedies Cumulative; Delay or Omission not Waiver..........................42
Section 8.6 Control by Debentureholders...........................................................42
Section 8.7 Undertaking to Pay Costs..............................................................43
Section 8.8 Direct Action; Right of Set-Off.......................................................43
ARTICLE IX FORM OF DEBENTURE AND ORIGINAL ISSUE..................................................43
Section 9.1 Form of Debenture.....................................................................43
Section 9.2 Original Issue of Debentures..........................................................44
ARTICLE X CONCERNING THE TRUSTEE................................................................44
Section 10.1 Certain Duties and Responsibilities of the Trustee....................................44
Section 10.2 Notice of Defaults....................................................................45
Section 10.3 Certain Rights of Trustee.............................................................45
ii
PAGE
----
Section 10.4 Trustee Not Responsible for Recitals, etc.............................................47
Section 10.5 May Hold Debentures...................................................................47
Section 10.6 Moneys Held in Trust..................................................................47
Section 10.7 Compensation and Reimbursement........................................................47
Section 10.8 Reliance on Officers' Certificate.....................................................48
Section 10.9 Disqualification: Conflicting Interests..............................................48
Section 10.10 Corporate Trustee Required; Eligibility...............................................48
Section 10.11 Resignation and Removal; Appointment of Successor.....................................49
Section 10.12 Acceptance of Appointment by Successor................................................50
Section 10.13 Merger, Conversion, Consolidation or Succession to Business...........................51
Section 10.14 Preferential Collection of Claims Against the Company.................................51
ARTICLE XI CONCERNING THE DEBENTUREHOLDERS.......................................................51
Section 11.1 Evidence of Action by Holders.........................................................51
Section 11.2 Proof of Execution by Debentureholders................................................52
Section 11.3 Who May be Deemed Owners..............................................................52
Section 11.4 Certain Debentures Owned by Company Disregarded.......................................52
Section 11.5 Actions Binding on Future Debentureholders............................................53
ARTICLE XII SUPPLEMENTAL INDENTURES...............................................................53
Section 12.1 Supplemental Indentures Without the Consent of Debentureholders.......................53
Section 12.2 Supplemental Indentures with Consent of Debentureholders..............................54
Section 12.3 Effect of Supplemental Indentures.....................................................55
Section 12.4 Debentures Affected by Supplemental Indentures........................................55
Section 12.5 Execution of Supplemental Indentures..................................................55
ARTICLE XIII SUCCESSOR CORPORATION.................................................................56
Section 13.1 Company May Consolidate, etc..........................................................56
Section 13.2 Successor Corporation Substituted.....................................................57
Section 13.3 Evidence of Consolidation, etc. to Trustee............................................57
ARTICLE XIV SATISFACTION AND DISCHARGE............................................................57
Section 14.1 Satisfaction and Discharge of Indenture...............................................57
Section 14.2 Discharge of Obligations..............................................................58
Section 14.3 Deposited Moneys to be Held in Trust..................................................58
Section 14.4 Payment of Monies Held by Paying Agents...............................................58
Section 14.5 Repayment to Company..................................................................58
ARTICLE XV IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS.......................59
Section 15.1 No Recourse...........................................................................59
iii
PAGE
----
ARTICLE XVI MISCELLANEOUS PROVISIONS..............................................................59
Section 16.1 Effect on Successors and Assigns......................................................59
Section 16.2 Actions by Successor..................................................................60
Section 16.3 Surrender of Company Powers...........................................................60
Section 16.4 Notices...............................................................................60
Section 16.5 Governing Law.........................................................................60
Section 16.6 Treatment of Debentures as Debt.......................................................60
Section 16.7 Compliance Certificates and Opinions..................................................60
Section 16.8 Payments on Business Days.............................................................61
Section 16.9 Conflict with Trust Indenture Act.....................................................61
Section 16.10 Counterparts..........................................................................61
Section 16.11 Separability..........................................................................61
Section 16.12 Assignment............................................................................62
Section 16.13 Acknowledgment of Rights..............................................................62
ARTICLE XVII SUBORDINATION OF DEBENTURES...........................................................62
Section 17.1 Agreement to Subordinate..............................................................62
Section 17.2 Default on Senior Debt, Subordinated Debt or Additional Senior Obligations............63
Section 17.3 Liquidation; Dissolution; Bankruptcy..................................................63
Section 17.4 Subrogation...........................................................................64
Section 17.5 Trustee to Effectuate Subordination...................................................65
Section 17.6 Notice by the Company.................................................................65
Section 17.7 Rights of the Trustee; Holders of Senior Indebtedness.................................66
Section 17.8 Subordination may not be Impaired.....................................................66
iv
CROSS-REFERENCE TABLE
SECTION OF
TRUST INDENTURE ACT SECTION OF
OF 1939, AS AMENDED INDENTURE
------------------- ---------
310(a) .....................................................................................................10.10
310(b) ......................................................................................................10.9
.....................................................................................................10.11
310(c) ............................................................................................Not Applicable
311(a) .....................................................................................................10.14
311(b) .....................................................................................................10.14
311(c) ............................................................................................Not Applicable
312(a) .......................................................................................................7.1
....................................................................................................7.2(a)
312(b) ....................................................................................................7.2(c)
312(c) ....................................................................................................7.2(c)
313(a) ....................................................................................................7.4(a)
313(b) ....................................................................................................7.4(b)
313(c) ....................................................................................................7.4(a)
....................................................................................................7.4(b)
313(d) ....................................................................................................7.4(c)
314(a) ....................................................................................................7.3(a)
314(b) ............................................................................................Not Applicable
314(c) ......................................................................................................16.7
314(d) ............................................................................................Not Applicable
314(e) ......................................................................................................16.7
314(f) ............................................................................................Not Applicable
315(a) ...................................................................................................10.1(a)
......................................................................................................10.3
315(b) ......................................................................................................10.2
315(c) ...................................................................................................10.1(a)
315(d) ...................................................................................................10.1(b)
315(e) .......................................................................................................8.7
316(a) .......................................................................................................1.1
.......................................................................................................8.6
316(b) ....................................................................................................8.4(b)
316(c) ...................................................................................................11.1(b)
317(a) .......................................................................................................8.2
317(b) .......................................................................................................6.3
318(a) ......................................................................................................16.9
Note: This reconciliation and tie sheet shall not, for any purpose, be deemed
to be a part of the Indenture.
v
INDENTURE
INDENTURE, dated as of __________ __, 2001, between GREATER ATLANTIC
FINANCIAL CORP., a Delaware corporation (the "Company") and WILMINGTON TRUST
COMPANY, a Delaware banking corporation duly organized and existing under the
laws of the State of Delaware as trustee (the "Trustee"), and in its separate
capacity and not in its capacity as Trustee (the "Bank);
RECITALS
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the execution and delivery of this Indenture to provide for the
issuance of securities to be known as its _____% Convertible Junior Subordinated
Debentures [DUE 2031] (hereinafter referred to as the "Debentures"), the form
and substance of such Debentures and the terms, provisions and conditions
thereof to be set forth as provided in this Indenture;
WHEREAS, Greater Atlantic Capital Trust I, a Delaware statutory business
trust (the "Trust"), has offered to the public up to $__________ aggregate
liquidation amount of its Preferred Securities (as defined herein) and proposes
to invest the proceeds from such offering, together with the proceeds of the
issuance and sale by the Trust to the Company of up to $_______ aggregate
liquidation amount of its Common Securities (as defined herein), in up to
$__________ aggregate principal amount of the Debentures;
WHEREAS, the Company has requested that the Trustee execute and deliver
this Indenture;
WHEREAS, all requirements necessary to make this Indenture a valid
instrument in accordance with its terms, and to make the Debentures, when
executed by the Company and authenticated and delivered by the Trustee, the
valid obligations of the Company, have been performed, and the execution and
delivery of this Indenture have been duly authorized in all respects;
WHEREAS, to provide the terms and conditions upon which the Debentures
are to be authenticated, issued and delivered, the Company has duly authorized
the execution of this Indenture; and
WHEREAS, all things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, in consideration of the premises and the purchase of the
Debentures by the holders thereof, it is mutually covenanted and agreed as
follows for the equal and ratable benefit of the holders of the Debentures:
1
ARTICLE I
DEFINITIONS
Section 1.1 Definitions of Terms.
The terms defined in this Section 1.1 (except as in this Indenture
otherwise expressly provided or unless the context otherwise requires) for all
purposes of this Indenture and of any indenture supplemental hereto shall have
the respective meanings specified in this Section 1.1 and shall include the
plural as well as the singular. All other terms used in this Indenture that are
defined in the Trust Indenture Act, or that are by reference in the Trust
Indenture Act defined in the Securities Act (except as herein otherwise
expressly provided or unless the context otherwise requires), shall have the
meanings assigned to such terms in the Trust Indenture Act and in the Securities
Act as in force at the date of the execution of this instrument. All accounting
terms used herein and not expressly defined shall have the meanings assigned to
such terms in accordance with Generally Accepted Accounting Principles.
"Accelerated Maturity Date" means, if the Company elects to accelerate
the maturity date, the date selected by the Company in accordance with Section
2.2.
"Additional Interest" shall have the meaning set forth in Section
2.5(c).
"Additional Senior Obligations" means all indebtedness of the Company
whether incurred on or prior to the date of this Indenture or thereafter
incurred, for claims in respect of derivative products such as interest and
foreign exchange rate contracts, commodity contracts and similar arrangements;
provided, however, that Additional Senior Obligations does not include claims in
respect of Senior Debt or Subordinated Debt or obligations which, by their
terms, are expressly stated to be not superior in right of payment to the
Debentures or to rank pari passu in right of payment with the Debentures. For
purposes of this definition, "claim" shall have the meaning assigned thereto in
Section 101(4) of the United States Bankruptcy Code of 1978, as amended.
"Administrative Trustees" shall have the meaning set forth in the Trust
Agreement.
"Affiliate" means, with respect to a specified Person, (a) any Person
directly or indirectly owning, controlling or holding with power to vote 10% or
more of the outstanding voting securities or other ownership interests of the
specified Person; (b) any Person 10% or more of whose outstanding voting
securities or other ownership interests are directly or indirectly owned,
controlled or held with power to vote by the specified Person; (c) any Person
directly or indirectly controlling, controlled by, or under common control with
the specified Person; (d) a partnership in which the specified Person is a
general partner; (e) any officer or director of the specified Person; and (f) if
the specified Person is an individual, any entity of which the specified Person
is an officer, director or general partner.
2
"Authenticating Agent" means an authenticating agent with respect to the
Debentures appointed by the Trustee pursuant to Section 2.12.
"Bankruptcy Law" means Title 11, U.S. Code, or any similar federal or
state law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company or any
duly authorized committee of such Board or any other duly designated officers of
the Company.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification.
"Business Day" means, with respect to the Debentures, any day other than
a Saturday or a Sunday or a day on which federal or state banking institutions
in the Borough of Manhattan, The City of New York, are authorized or required by
law, executive order or regulation to close, or a day on which the Corporate
Trust Office of the Trustee or the Property Trustee is closed for business.
"Capital Treatment Event" means the receipt by the Company and the Trust
of an Opinion of Counsel, rendered by a law firm having a recognized national
bank regulatory practice, to the effect that, as a result of any amendment to,
or change (including any announced prospective change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision
thereof or therein, or as a result of any official or administrative
pronouncement or action or judicial decision interpreting or applying such laws
or regulations, which amendment or change is effective or which pronouncement,
action or decision is announced on or after the date of issuance of the
Preferred Securities under the Trust Agreement, there is more than an
insubstantial risk of impairment of the Company's ability to treat the Preferred
Securities (or any substantial portion thereof) as Tier 1 capital (or its then
equivalent if the Company were subject to such requirement), applied as if the
Company (or its successors) were a bank holding company, for purposes of the
capital adequacy guidelines of the Federal Reserve; provided, however, that the
Trust or the Company shall have requested and received such an Opinion of
Counsel with regard to such matters within a reasonable period of time after the
Trust or the Company shall have become aware of the possible occurrence of any
such event; provided, however, that the inability of the Company to treat all or
any portion of the Liquidation Amount of the Preferred Securities as Tier 1
Capital shall not constitute the basis for a Capital Treatment Event if such
inability results from the Company having cumulative preferred stock, minority
interests in consolidated subsidiaries, or any other class of security or
interest which the Federal Reserve now or may hereafter accord Tier 1 Capital
treatment in excess of the amount which may qualify for treatment as Tier 1
Capital under applicable capital adequacy guidelines of the Federal Reserve;
provided, further, however, that the distribution of Junior Subordinated
Debentures in connection with the dissolution of the Trust shall not in and of
itself constitute a Capital Treatment Event.
3
"Certificate" means a certificate signed by the principal executive
officer, the principal financial officer, the principal accounting officer, the
treasurer or any vice president of the Company. The Certificate need not comply
with the provisions of Section 16.7.
"Change in 1940 Act Law" shall have the meaning set forth in the
definition of "Investment Company Event."
"Commission" means the Securities and Exchange Commission.
"Common Securities" means undivided beneficial interests in the assets
of the Trust which rank pari passu with the Preferred Securities; provided,
however, that upon the occurrence of an Event of Default, the rights of holders
of Common Securities to payment in respect of distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights of holders
of Preferred Securities.
"Common Stock" means the common stock, no par value, of the Company.
"Company" means Greater Atlantic Financial Corp., a corporation duly
organized and existing under the laws of the State of Delaware, and, subject to
the provisions of Article XIII, shall also include its successors and assigns.
"Compounded Interest" shall have the meaning set forth in Section 5.1.
"Conversion Agent" means the Person appointed to act on behalf of the
holders of the Preferred Securities in effecting the conversion of Preferred
Securities to Debentures and Debentures to Common Stock as and in the manner set
forth in the Trust Agreement and this Indenture.
"Conversion Price" means $____.
"Conversion Ratio" has the meaning set forth in Section 4.1.
"Conversion Request" means (a) the irrevocable request to be given by a
Debentureholder to the Conversion Agent directing the Conversion Agent to
convert the Debentures into shares of Common Stock, and (b) the irrevocable
request to be given by a Holder (as defined in the Trust Agreement) of Preferred
Securities to the Conversion Agent directing the Conversion Agent to exchange
such stock on behalf of such Holder.
"Corporate Trust Office" means the office of the Trustee at which, at
any particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at Xxxxxx Square North,
0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000-0000, Attention: Corporate
Trust Administration.
"Coupon Rate" shall have the meaning set forth in Section 2.5.
4
"Custodian" means any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.
"Debentures" shall have the meaning set forth in the Recitals hereto.
"Debentureholder," "holder of Debentures," "registered holder," or other
similar term, means the Person or Persons in whose name or names a particular
Debenture shall be registered on the Debenture Register in accordance with the
terms of this Indenture.
"Debenture Register" shall have the meaning set forth in Section 2.7(b).
"Debenture Registrar" shall have the meaning set forth in Section
2.7(b).
"Debt" means with respect to any Person, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; and (vi) and every
obligation of the type referred to in clauses (i) through (v) of another Person
and all dividends of another Person the payment of which, in either case, such
Person has guaranteed or is responsible or liable, directly or indirectly, as
obligor or otherwise.
"Default" means any event, act or condition that with notice or lapse of
time, or both, would constitute an Event of Default.
"Deferred Interest" shall have the meaning set forth in Section 5.1.
"Direct Action" shall have the meaning set forth in Section 8.8.
"Dissolution Event" means that as a result of the occurrence and
continuation of a Special Event, the Trust is to be dissolved in accordance with
the Trust Agreement and the Debentures held by the Property Trustee are to be
distributed to the holders of the Trust Securities issued by the Trust pro rata
in accordance with the Trust Agreement.
"Event of Default" means, with respect to the Debentures, any event
specified in Section 8.1, which has continued for the period of time, if any,
and after the giving of the notice, if any, therein designated.
"Exchange Act," means the Securities Exchange Act of 1934, as amended,
as in effect at the date of execution of this Indenture.
5
"Extended Interest Payment Period" shall have the meaning set forth in
Section 5.1.
"Federal Reserve" means the Board of Governors of the Federal Reserve
System.
"Generally Accepted Accounting Principles" means such accounting
principles as are generally accepted at the time of any computation required
hereunder.
"Governmental Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged; or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America that, in either case, are not
callable or redeemable at the option of the issuer thereof, and shall also
include a depositary receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such Governmental
Obligation or a specific payment of principal of or interest on any such
Governmental Obligation held by such custodian for the account of the holder of
such depositary receipt; provided, however, that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depositary receipt from any amount received by the
custodian in respect of the Governmental Obligation or the specific payment of
principal of or interest on the Governmental Obligation evidenced by such
depositary receipt.
"Herein," "hereof," 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.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into in accordance with the terms hereof.
"Interest Payment Date," when used with respect to any installment of
interest on the Debentures, means the date specified in the Debenture or in an
indenture supplemental hereto with respect to the Debentures as the fixed date
on which an installment of interest with respect to the Debentures is due and
payable.
"Investment Company Act," means the Investment Company Act of 1940, as
amended, as in effect at the date of execution of this Indenture.
"Investment Company Event" means the receipt by the Trust and the
Company of an Opinion of Counsel, rendered by a law firm having a recognized
national tax and securities law practice, to the effect that, as a result of the
occurrence of a change in law or regulation or a change in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority (a "Change in 1940 Act Law"), the Trust is or
shall be considered an "investment company" that is required to be registered
under the Investment Company Act, which Change in 1940 Act Law becomes effective
on or after the date of original issuance of the Preferred Securities under the
Trust Agreement; provided, however, that the Trust or the Company shall have
requested and received such an Opinion of Counsel with regard
6
to such matters within a reasonable period of time after the Trust or the
Company shall have become aware of the possible occurrence of any such event.
"Maturity Date" means the date on which the Debentures mature and on
which the principal shall be due and payable together with all accrued and
unpaid interest thereon including Compounded Interest and Additional Interest,
if any.
"Ministerial Action" shall have the meaning set forth in Section 3.2.
"Officers' Certificate" means a certificate signed by the President or
an Executive Vice President and by the Chief Financial Officer or the Treasurer
or an Assistant Treasurer or the Secretary or an Assistant Secretary of the
Company that is delivered to the Trustee in accordance with the terms hereof.
Each such certificate shall include the statements provided for in Section 16.7,
if and to the extent required by the provisions thereof.
"Opinion of Counsel" means an opinion in writing of independent, outside
legal counsel for the Company that is delivered to the Trustee in accordance
with the terms hereof. Each such opinion shall include the statements provided
for in Section 16.7, if and to the extent required by the provisions thereof.
"Outstanding," when used in reference to the Debentures, means, subject
to the provisions of Section 11.4, as of any particular time, all Debentures
theretofore authenticated and delivered by the Trustee under this Indenture,
except (a) Debentures theretofore canceled by the Trustee or any paying agent,
or delivered to the Trustee or any paying agent for cancellation or that have
previously been canceled; (b) Debentures or portions thereof for the payment or
redemption of which moneys or Governmental Obligations in the necessary amount
shall have been deposited in trust with the Trustee or with any paying agent
(other than the Company) or shall have been set aside and segregated in trust by
the Company (if the Company shall act as its own paying agent); provided,
however, that if such Debentures or portions of such Debentures are to be
redeemed prior to the maturity thereof, notice of such redemption shall have
been given as provided in Article III, or provision satisfactory to the Trustee
shall have been made for giving such notice; and (c) Debentures in lieu of or in
substitution for which other Debentures shall have been authenticated and
delivered pursuant to the terms of Section 2.7; provided, however, that in
determining whether the holders of the requisite percentage of Debentures have
given any request, notice, consent or waiver hereunder, Debentures held by the
Company or any Affiliate of the Company shall not be included; provided,
further, that the Trustee shall be protected in relying upon any request,
notice, consent or waiver unless a Responsible Officer of the Trustee shall have
actual knowledge that the holder of such Debenture is the Company or an
Affiliate thereof.
"Person" means any individual, corporation, partnership, joint-venture,
joint-stock company, limited liability company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
7
"Predecessor Debenture" means every previous Debenture evidencing all or
a portion of the same debt as that evidenced by such particular Debenture; and,
for the purposes of this definition, any Debenture authenticated and delivered
under Section 2.9 in lieu of a lost, destroyed or stolen Debenture shall be
deemed to evidence the same debt as the lost, destroyed or stolen Debenture.
"Preferred Securities" means the _____% Cumulative Convertible Trust
Preferred Securities representing undivided beneficial interests in the assets
of the Trust which rank pari passu with Common Securities issued by the Trust;
provided, however, that upon the occurrence of an Event of Default, the rights
of holders of Common Securities to payment in respect of distributions and
payments upon liquidation, redemption and otherwise are subordinated to the
rights of holders of Preferred Securities.
"Preferred Securities Guarantee" means any guarantee that the Company
may enter into with the Trustee or other Persons that operates directly or
indirectly for the benefit of holders of Preferred Securities.
"Property Trustee" has the meaning set forth in the Trust Agreement.
"Redemption Price" shall have the meaning set forth in Section 3.2.
"Responsible Officer" when used with respect to the Trustee means any
officer within the Corporate Trust Office of the Trustee with direct
responsibility for the administration of this Indenture, including any vice
president, any assistant vice president, any assistant secretary or any other
officer or assistant officer of the Trustee who customarily performs functions
similar to those performed by the Persons who at the time shall be such
officers, respectively, or to whom any corporate trust matter is referred
because of his or her knowledge of and familiarity with the particular subject.
"Scheduled Maturity Date" means [DECEMBER 31, 2031].
"Securities Act," means the Securities Act of 1933, as amended, as in
effect at the date of execution of this instrument.
"Senior Debt" means the principal of (and premium, if any) and interest,
if any (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not such
claim for post-petition interest is allowed in such proceeding), on Debt,
whether incurred on or prior to the date of this Indenture or thereafter
incurred, unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding, it is provided that such obligations are not
superior in right of payment to the Debentures or to other Debt which is pari
passu with, or subordinated to, the Debentures, provided, however, that Senior
Debt shall not be deemed to include (i) any Debt of the Company which when
incurred and without respect to any election under section 1111(b) of the United
States Bankruptcy Code of 1978, as amended, was without recourse to the Company;
(ii) any Debt of the Company owed to any of its subsidiaries; (iii) Debt owed to
any employee of the
8
Company; (iv) Debt which by its terms is subordinated to trade accounts payable
or accrued liabilities arising in the ordinary course of business to the extent
that payments made to the holders of such Debt by the holders of the Debentures
as a result of the subordination provisions of this Indenture would be greater
than they otherwise would have been as a result of any obligation of such
holders to pay amounts over to the obligees on such trade accounts payable or
accrued liabilities arising in the ordinary course of business as a result of
subordination provisions to which such Debt is subject; and (v) Debt which
constitutes Subordinated Debt.
"Senior Indebtedness" shall have the meaning set forth in Section 17.1.
"Special Event" means a Tax Event, an Investment Company Event or a
Capital Treatment Event.
"Subordinated Debt" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company whether or
not such claim for post-petition interest is allowed in such proceeding), on
Debt, whether incurred on or prior to the date of this Indenture or thereafter
incurred, which is by its terms expressly provided to be junior and subordinate
to Senior Debt of the Company and on any Debt of the Company under debt
securities (and guarantees in respect of these debt securities) initially issued
to any trust, or a trustee of a trust, partnership or other entity affiliated
with the Company that is, directly or indirectly, a financing vehicle of the
Company in connection with the issuance by that entity of preferred securities
or other securities which are intended to qualify for Tier 1 capital treatment
such as Subordinated Debentures, unless those debt securities are by their terms
convertible into our Common Stock of the Company; provided however, that
Subordinated Debt will not be deemed to include (i) any Debt of the Company
which when incurred and without respect to any election under section 1111(b) of
the United States Bankruptcy Code of 1978, as amended, was without recourse to
the Company, (ii) any Debt of the Company owed to any of its subsidiaries, (iii)
any Debt owed to any employee of the Company, (iv) any Debt which by its terms
is subordinated to trade accounts payable or accrued liabilities arising in the
ordinary course of business to the extent that payments made to the holders of
such Debt by the holders of the Subordinated Debentures as a result of the
subordination provisions of the Indenture would be greater than they otherwise
would have been as a result of any obligation of such holders to pay amounts
over to the obligees on such trade accounts payable or accrued liabilities
arising in the ordinary course of business as a result of subordination
provisions to which such Debt is subject, and (v) Debt which constitutes Senior
Debt.
"Subsidiary" means, with respect to any Person, (i) any corporation at
least a majority of whose outstanding Voting Stock shall at the time be owned,
directly or indirectly, by such Person or by one or more of its Subsidiaries or
by such Person and one or more of its Subsidiaries; (ii) any general
partnership, limited liability company, joint venture, trust or similar entity,
at least a majority of whose outstanding partnership or similar interests shall
at the time be owned by such Person, or by one or more of its Subsidiaries, or
by such Person and one or more of its Subsidiaries; and (iii) any limited
partnership of which such Person or any of its Subsidiaries is a general
partner.
9
"Tax Event" means the receipt by the Company and the Trust of an Opinion
of Counsel, rendered by a law firm having a recognized national tax and
securities practice, to the effect that, as a result of any amendment to, or
change (including any announced prospective change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which
pronouncement or decision is announced on or after the date of issuance of the
Preferred Securities under the Trust Agreement, there is more than an
insubstantial risk that (i) the Trust is, or shall be within 90 days after the
date of such Opinion of Counsel, subject to United States federal income tax
with respect to income received or accrued on the Debentures; (ii) interest
payable by the Company on the Debentures is not, or within 90 days after the
date of such Opinion of Counsel, shall not be, deductible by the Company, in
whole or in part, for United States federal income tax purposes; or (iii) the
Trust is, or shall be within 90 days after the date of such Opinion of Counsel,
subject to more than a de minimis amount of other taxes, duties, assessments or
other governmental charges; provided, however, that the Trust or the Company
shall have requested and received such an Opinion of Counsel with regard to such
matters within a reasonable period of time after the Trust or the Company shall
have become aware of the possible occurrence of any of the events described in
clauses (i) through (iii) above.
"Trust" means Greater Atlantic Capital Trust I, a Delaware statutory
business trust.
"Trust Agreement" means the Amended and Restated Trust Agreement, dated
as of _________ __, 2001, of the Trust.
"Trustee" means Wilmington Trust Company and, subject to the provisions
of Article X, shall also include its successors and assigns, and, if at any time
there is more than one Person acting in such capacity hereunder, "Trustee" shall
mean each such Person.
"Trust Indenture Act," means the Trust Indenture Act of 1939, as
amended, subject to the provisions of Sections 12.1, 12.2, and 13.1, as in
effect at the date of execution of this instrument.
"Trust Securities" means the Common Securities and Preferred Securities,
collectively.
"Voting Stock," as applied to stock of any Person, means shares,
interests, participations or other equivalents in the equity interest (however
designated) in such Person having ordinary voting power for the election of a
majority of the directors (or the equivalent) of such Person, other than shares,
interests, participations or other equivalents having such power only by reason
of the occurrence of a contingency.
10
ARTICLE II
ISSUE, DESCRIPTION, TERMS, CONDITIONS
REGISTRATION AND EXCHANGE OF THE DEBENTURES
Section 2.1 Designation and Principal Amount.
There is hereby authorized Debentures designated the "_____% Convertible
Junior Subordinated Debentures [DUE 2031]," limited in aggregate principal
amount to $__________, which amount shall be as set forth in any written order
of the Company for the authentication and delivery of Debentures pursuant to
Section 2.6.
Section 2.2 Maturity.
(a) The Maturity Date shall be either:
(i) the Scheduled Maturity Date; or
(ii) if the Company elects to accelerate the Maturity Date to
be a date prior to the Scheduled Maturity Date in
accordance with Section 2.2(c), the Accelerated Maturity
Date.
(b) the Company may at any time after [DECEMBER 31, 2003] but prior
to 90 days before the Scheduled Maturity Date elect to shorten the Maturity Date
only once to the Accelerated Maturity Date.
(c) if the Company elects to accelerate the Maturity Date in
accordance with Section 2.2(b), the Company shall give notice to the Trustee and
the Trust (unless the Trust is not the holder of the Debentures, in which case
the Company will give notice to the Trustee, which will then give notice to the
holders of the Debentures) of the acceleration of the Maturity Date and the
Accelerated Maturity Date at least 30 days and no more than 180 days before the
Accelerated Maturity Date; provided, however that nothing provided in this
Section 2.2 shall limit the Company's rights, as provided in Article III hereof,
to redeem all or a portion of the Debentures at such time or times on or after
[DECEMBER 31, 2003], as the Company may so determine, or at any time upon the
occurrence of a Special Event.
Section 2.3 Form and Payment.
The Debentures shall be issued in fully registered certificated form
without interest coupons. Principal and interest on the Debentures issued in
certificated form shall be payable, the transfer of such Debentures shall be
registrable and such Debentures shall be exchangeable for Debentures bearing
identical terms and provisions at the office or agency of the Trustee; provided,
however, that payment of interest may be made at the option of the Company by
check mailed to the holder at such address as shall appear in the Debenture
Register or by wire transfer to an account maintained by the holder as specified
in the Debenture Register, provided that the holder provides proper transfer
instructions by the regular record date. Notwithstanding the
11
foregoing, so long as the holder of any Debentures is the Property Trustee, the
payment of principal of and interest (including Compounded Interest and
Additional Interest, if any) on such Debentures held by the Property Trustee
shall be made at such place and to such account as may be designated by the
Property Trustee.
Section 2.4 [Intentionally Left Blank].
Section 2.5 Interest.
(a) Each Debenture shall bear interest at the rate of _____% per
annum (the "Coupon Rate") from the original date of issuance until the principal
thereof becomes due and payable, and on any overdue principal and (to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the Coupon Rate, compounded quarterly,
payable (subject to the provisions of Article V) quarterly in arrears on March
31, June 30, September 30 and December 31 of each year (each, an "Interest
Payment Date"), commencing on [MARCH 31, 2002] to the Person in whose name such
Debenture or any Predecessor Debenture is registered, at the close of business
on the regular record date for such interest installment, which shall be the
fifteenth day of the last month of the calendar quarter.
(b) The amount of interest payable for any period shall be computed
on the basis of a 360-day year consisting of twelve 30-day months. The amount of
interest payable for any period shorter than a full quarterly period for which
interest is computed, shall be computed on the basis of the number of days
elapsed in a 360- day year consisting of twelve 30-day months. In the event that
any date on which interest is payable on the Debentures is not a Business Day,
then payment of interest payable on such date shall be made on the next
succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the immediately
preceding Business Day (and without any reduction of interest or any other
payment in respect of any such acceleration), in each case with the same force
and effect as if made on the date such payment was originally payable.
(c) If, at any time while the Property Trustee is the holder of any
Debentures, the Trust or the Property Trustee is required to pay any taxes,
duties, assessments or governmental charges of whatever nature (other than
withholding taxes) imposed by the United States, or any other taxing authority,
then, in any case, the Company shall pay as additional interest ("Additional
Interest") on the Debentures held by the Property Trustee, such additional
amounts as shall be required so that the net amounts received and retained by
the Trust and the Property Trustee after paying such taxes, duties, assessments
or other governmental charges shall be equal to the amounts the Trust and the
Property Trustee would have received had no such taxes, duties, assessments or
other government charges been imposed.
Section 2.6 Execution and Authentications.
(a) The Debentures shall be signed on behalf of the Company by its
President or one of its Executive Vice Presidents or Chief Financial Officer or
Treasurer, under its corporate seal
12
attested by its Secretary or one of its Assistant Secretaries. Signatures may be
in the form of a manual or facsimile signature. The Company may use the
facsimile signature of any Person who shall have been a President or Executive
Vice President thereof, or of any Person who shall have been a Secretary or
Assistant Secretary thereof, notwithstanding the fact that at the time the
Debentures shall be authenticated and delivered or disposed of such Person shall
have ceased to be the President or a Vice President, or the Secretary or an
Assistant Secretary, of the Company (and any such signature shall be binding on
the Company). The seal of the Company may be in the form of a facsimile of such
seal and may be impressed, affixed, imprinted or otherwise reproduced on the
Debentures. The Debentures may contain such notations, legends or endorsements
required by law, stock exchange rule or usage. Each Debenture shall be dated the
date of its authentication by the Trustee.
(b) A Debenture shall not be valid until authenticated manually by
an authorized signatory of the Trustee, or by an Authenticating Agent. Such
signature shall be conclusive evidence that the Debenture so authenticated has
been duly authenticated and delivered hereunder and that the holder is entitled
to the benefits of this Indenture.
(c) At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Debentures executed by the
Company to the Trustee for authentication, together with a written order of the
Company for the authentication and delivery of such Debentures signed by its
President or any Executive Vice President and its Chief Financial Officer or the
Treasurer or any Assistant Treasurer, and the Trustee in accordance with such
written order is authorized to authenticate and deliver such Debentures.
(d) In authenticating such Debentures and accepting the additional
responsibilities under this Indenture in relation to such Debentures, the
Trustee shall be entitled to receive, and (subject to Section 10.1) shall be
fully protected in relying upon, an Opinion of Counsel stating that the form and
terms thereof have been established in conformity with the provisions of this
Indenture.
(e) The Trustee shall not be required to authenticate such
Debentures if the issue of such Debentures pursuant to this Indenture shall
affect the Trustee's own rights, duties or immunities under the Debentures and
this Indenture or otherwise in a manner that is not reasonably acceptable to the
Trustee.
Section 2.7 Registration of Transfer and Exchange.
(a) Debentures may be exchanged upon presentation thereof at the
office or agency of the Company designated for such purpose in the Borough of
Manhattan, The City of New York, or at the office of the Debenture Registrar,
for other Debentures and for a like aggregate principal amount in denominations
of integral multiples of [$__], upon payment of a sum sufficient to cover any
tax or other governmental charge in relation thereto, all as provided in this
Section 2.7. In respect of any Debentures so surrendered for exchange, the
Company shall execute, the Trustee shall authenticate and such office or agency
shall deliver in exchange therefor the Debenture or Debentures that the
Debentureholder making the exchange shall be entitled to receive, bearing
numbers not contemporaneously outstanding.
13
(b) The Company shall keep, or cause to be kept, at its office or
agency designated for such purpose in the Borough of Manhattan, The City of New
York, or at the office of the Debenture Registrar or such other location
designated by the Company a register or registers (herein referred to as the
"Debenture Register") in which, subject to such reasonable regulations as the
Debenture Registrar (as defined below) may prescribe, the Company shall register
the Debentures and the transfers of Debentures as provided in this Article II
and which at all reasonable times shall be open for inspection by the Trustee.
The registrar for the purpose of registering Debentures and transfer of
Debentures as herein provided shall initially be the Trustee and thereafter as
may be appointed by the Company as authorized by Board Resolution (the
"Debenture Registrar") and the location of the Debenture Register shall
initially be the Corporate Trust Office of the Trustee. Upon surrender for
transfer of any Debenture at the office or agency of the Company designated for
such purpose, the Company shall execute, the Trustee shall authenticate and such
office or agency shall deliver in the name of the transferee or transferees a
new Debenture or Debentures for a like aggregate principal amount. All
Debentures presented or surrendered for exchange or registration of transfer, as
provided in this Section 2.7, shall be accompanied (if so required by the
Company or the Debenture Registrar) by a written instrument or instruments of
transfer, in form satisfactory to the Company or the Debenture Registrar, duly
executed by the registered holder or by such holder's duly authorized attorney
in writing.
(c) No service charge shall be made for any exchange or registration
of transfer of Debentures, or issue of new Debentures in case of partial
redemption, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge in relation thereto, other than exchanges
pursuant to Section 2.8, Section 3.5(b) and Section 12.4 not involving any
transfer.
(d) The Company shall not be required (i) to issue, exchange or
register the transfer of any Debentures during a period beginning at the opening
of business 15 days before the day of the mailing of a notice of redemption of
less than all the Outstanding Debentures and ending at the close of business on
the day of such mailing; nor (ii) to register the transfer of or exchange any
Debentures or portions thereof called for redemption.
(e) Debentures may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Indenture. Any
transfer or purported transfer of any Debenture not made in accordance with this
Indenture shall be null and void.
Section 2.8 Temporary Debentures.
Pending the preparation of definitive Debentures, the Company may
execute, and the Trustee shall authenticate and deliver, temporary Debentures
(printed, lithographed, or typewritten). Such temporary Debentures shall be
substantially in the form of the definitive Debentures in lieu of which they are
issued, but with such omissions, insertions and variations as may be appropriate
for temporary Debentures, all as may be determined by the Company. Every
temporary Debenture shall be executed by the Company and be authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with
like effect, as the
14
definitive Debentures. Without unnecessary delay the Company shall execute and
shall furnish definitive Debentures and thereupon any or all temporary
Debentures may be surrendered in exchange therefor (without charge to the
holders), at the office or agency of the Company designated for the purpose in
the Borough of Manhattan, The City of New York, and the Trustee shall
authenticate and such office or agency shall deliver in exchange for such
temporary Debentures an equal aggregate principal amount of definitive
Debentures, unless the Company advises the Trustee to the effect that definitive
Debentures need not be executed, authenticated and furnished until further
notice from the Company. Until so exchanged, the temporary Debentures shall be
entitled to the same benefits under this Indenture as definitive Debentures
authenticated and delivered hereunder.
Section 2.9 Mutilated, Destroyed, Lost or Stolen Debentures.
(a) In case any temporary or definitive Debenture shall become
mutilated or be destroyed, lost or stolen, the Company (subject to the next
succeeding sentence) shall execute, and upon the Company's request the Trustee
(subject as aforesaid) shall authenticate and deliver, a new Debenture bearing a
number not contemporaneously outstanding, in exchange and substitution for the
mutilated Debenture, or in lieu of and in substitution for the Debenture so
destroyed, lost, stolen or mutilated. In every case the applicant for a
substituted Debenture shall furnish to the Company and the Trustee such security
or indemnity as may be required by them to save each of them harmless, and, in
every case of destruction, loss or theft, the applicant shall also furnish to
the Company and the Trustee evidence to their satisfaction of the destruction,
loss or theft of the applicant's Debenture and of the ownership thereof. The
Trustee is authorized to authenticate any such substituted Debenture and deliver
the same upon the written request or authorization of the President or any Vice
President and the Chief Financial Officer or the Treasurer or any Assistant
Treasurer of the Company. Upon the issuance of any substituted Debenture, 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 and the Trustee's
counsel) connected therewith. In case any Debenture that has matured or is about
to mature shall become mutilated or be destroyed, lost or stolen, the Company
may, instead of issuing a substitute Debenture, pay or authorize the payment of
the same (without surrender thereof except in the case of a mutilated Debenture)
if the applicant for such payment shall furnish to the Company and the Trustee
such security or indemnity as they may require to save them harmless, and, in
case of destruction, loss or theft, evidence to the satisfaction of the Company
and the Trustee of the destruction, loss or theft of such Debenture and of the
ownership thereof.
(b) Every replacement Debenture issued pursuant to the provisions of
this Section 2.9 shall constitute an additional contractual obligation of the
Company whether or not the mutilated, destroyed, lost or stolen Debenture shall
be found at any time, or be enforceable by anyone, and shall be entitled to all
the benefits of this Indenture equally and proportionately with any and all
other Debentures duly issued hereunder. All Debentures shall be held and owned
upon the express condition that the foregoing provisions are exclusive with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Debentures, and shall preclude (to the extent lawful) any and all other rights
or remedies, notwithstanding any law or statute
15
existing or hereafter enacted to the contrary with respect to the replacement or
payment of negotiable instruments or other securities without their surrender.
Section 2.10 Cancellation.
All Debentures surrendered for the purpose of payment, redemption,
exchange, conversion or registration of transfer shall, if surrendered to the
Company or any paying agent, be delivered to the Trustee for cancellation, or,
if surrendered to the Trustee, shall be canceled by it, and no Debentures shall
be issued in lieu thereof except as expressly required or permitted by any of
the provisions of this Indenture. On request of the Company at the time of such
surrender, the Trustee shall deliver to the Company canceled Debentures held by
the Trustee. In the absence of such request the Trustee may dispose of canceled
Debentures in accordance with its standard procedures and deliver a certificate
of disposition to the Company. If the Company shall otherwise acquire any of the
Debentures, however, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by such Debentures unless and until
the same are delivered to the Trustee for cancellation.
Section 2.11 Benefit of Indenture.
Nothing in this Indenture or in the Debentures, express or implied,
shall give or be construed to give to any Person, other than the parties hereto
and the holders of the Debentures (and, with respect to the provisions of
Article XVII, the holders of Senior Indebtedness) any legal or equitable right,
remedy or claim under or in respect of this Indenture, or under any covenant,
condition or provision herein contained; all such covenants, conditions and
provisions being for the sole benefit of the parties hereto and of the holders
of the Debentures (and, with respect to the provisions of Article XVII, the
holders of Senior Indebtedness).
Section 2.12 Authenticating Agent.
(a) So long as any of the Debentures remain Outstanding there may be
an Authenticating Agent for any or all such Debentures, which Authenticating
Agent the Trustee shall have the right to appoint. Said Authenticating Agent
shall be authorized to act on behalf of the Trustee to authenticate Debentures
issued upon exchange, transfer or partial redemption thereof, and Debentures 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. All references in this Indenture to the authentication of Debentures
by the Trustee shall be deemed to include authentication by an Authenticating
Agent. Each Authenticating Agent shall be acceptable to the Company and shall be
a corporation that has a combined capital and surplus, as most recently reported
or determined by it, sufficient under the laws of any jurisdiction under which
it is organized or in which it is doing business to conduct a trust business,
and that is otherwise authorized under such laws to conduct such business and is
subject to supervision or examination by federal or state authorities. If at any
time any Authenticating Agent shall cease to be eligible in accordance with
these provisions, it shall resign immediately.
16
(b) Any Authenticating Agent may at any time resign by giving
written notice of resignation to the Trustee and to the Company. The Trustee may
at any time (and upon request by the Company shall) terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and to the Company. Upon resignation, termination or
cessation of eligibility of any Authenticating Agent, the Trustee may appoint an
eligible successor Authenticating Agent acceptable to the Company. Any successor
Authenticating Agent, upon acceptance of its appointment hereunder, shall become
vested with all the rights, powers and duties of its predecessor hereunder as if
originally named as an Authenticating Agent pursuant hereto.
ARTICLE III
REDEMPTION OF DEBENTURES
Section 3.1 Redemption.
The Company may redeem the Debentures issued hereunder on and after the
dates set forth in and in accordance with the terms of this Article III.
Section 3.2 Special Event Redemption.
If a Special Event has occurred and is continuing, then, notwithstanding
Section 3.3(a) but subject to Section 3.3(b), the Company shall have the right
upon not less than 30 days' nor more than 60 days' notice to the holders of the
Debentures to redeem the Debentures, in whole but not in part, for cash within
180 days following the occurrence of such Special Event (the "180-Day Period")
at a redemption price equal to 100% of the principal amount to be redeemed plus
any accrued and unpaid interest thereon to the date of such redemption (the
"Redemption Price"), provided that if at the time there is available to the
Company the opportunity to eliminate, within the 180-Day Period, a Tax Event by
taking some ministerial action (a "Ministerial Action"), such as filing a form
or making an election, or pursuing some other similar reasonable measure which
has no adverse effect on the Company, the Trust or the holders of the Trust
Securities issued by the Trust, the Company shall pursue such Ministerial Action
in lieu of redemption, and, provided further, that the Company shall have no
right to redeem the Debentures pursuant to this Section 3.2 while it is pursuing
any Ministerial Action pursuant to its obligations hereunder, and, provided
further, that, if it is determined that the taking of a Ministerial Action would
not eliminate the Tax Event within the 180 Day Period, the Company's right to
redeem the Debentures pursuant to this Section 3.2 shall be restored and it
shall have no further obligations to pursue the Ministerial Action. The
Redemption Price shall be paid prior to 12:00 noon, New York time, on the date
of such redemption or such earlier time as the Company determines, provided that
the Company shall deposit with the Trustee an amount sufficient to pay the
Redemption Price by 10:00 a.m., New York time, on the date such Redemption Price
is to be paid.
17
Section 3.3 Optional Redemption by Company.
(a) Subject to the provisions of Section 3.3(c), except as otherwise
may be specified in this Indenture, the Company shall have the right to redeem
the Debentures, in whole or in part, from time to time, on or after [DECEMBER
31, 2003], at a Redemption Price equal to 100% of the principal amount to be
redeemed plus any accrued and unpaid interest thereon to the date of such
redemption. Any redemption pursuant to this Section 3.3(a) shall be made upon
not less than 30 days' nor more than 60 days' notice to the holder of the
Debentures, at the Redemption Price. If the Debentures are only partially
redeemed pursuant to this Section 3.3(a), the Debentures shall be redeemed pro
rata or by lot or in such other manner as the Trustee shall deem appropriate and
fair in its discretion. The Redemption Price shall be paid prior to 12:00 noon,
New York time, on the date of such redemption or at such earlier time as the
Company determines provided that the Company shall deposit with the Trustee an
amount sufficient to pay the Redemption Price by 10:00 a.m., New York time, on
the date such Redemption Price is to be paid.
(b) Subject to the provisions of Section 3.3(c), the Company shall
have the right to redeem Debentures at any time and from time to time in a
principal amount equal to the Liquidation Amount (as defined in the Trust
Agreement) of any Preferred Securities purchased and beneficially owned by the
Company, plus an additional principal amount of Debentures equal to the
Liquidation Amount (as defined in the Trust Agreement) of that number of Common
Securities that bears the same proportion to the total number of Common
Securities then outstanding as the number of Preferred Securities to be redeemed
bears to the total number of Preferred Securities then outstanding. Such
Debentures shall be redeemed pursuant to this Section 3.3(b) only in exchange
for and upon surrender by the Company to the Property Trustee of the Preferred
Securities and a proportionate amount of Common Securities, whereupon the
Property Trustee shall cancel the Preferred Securities and Common Securities so
surrendered and a Like Amount (as defined in the Trust Agreement) of Debentures
shall be deemed no longer Outstanding and a notation to that effect shall be
made in the Debenture Register.
(c) If a partial redemption of the Debentures would result in the
delisting of the Preferred Securities issued by the Trust from The Nasdaq
National Market or any national securities exchange or other organization on
which the Preferred Securities are then listed or quoted, the Company shall not
be permitted to effect such partial redemption and may only redeem the
Debentures in whole.
Section 3.4 Notice of Redemption.
(a) Except in the case of a redemption pursuant to Section 3.3(b),
in case the Company shall desire to exercise such right to redeem all or, as the
case may be, a portion of the Debentures in accordance with the right reserved
so to do, the Company shall, or shall cause the Trustee to upon receipt of 45
days' written notice from the Company (which notice shall, in the event of a
partial redemption, include a representation to the effect that such partial
redemption will not result in the delisting of the Preferred Securities as
described in Section 3.3(c) above), give notice of such redemption to holders of
the Debentures to be redeemed by mailing, first
18
class postage prepaid, a notice of such redemption not less than 30 days and not
more than 60 days before the date fixed for redemption to such holders at their
last addresses as they shall appear upon the Debenture Register unless a shorter
period is specified in the Debentures to be redeemed. Any notice that is mailed
in the manner herein provided shall be conclusively presumed to have been duly
given, whether or not the registered holder receives the notice. In any case,
failure duly to give such notice to the holder of any Debenture designated for
redemption in whole or in part, or any defect in the notice, shall not affect
the validity of the proceedings for the redemption of any other Debentures. In
the case of any redemption of Debentures prior to the expiration of any
restriction on such redemption provided in the terms of such Debentures or
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with any such restriction. Each such
notice of redemption shall specify the date fixed for redemption and the
Redemption Price and shall state that payment of the Redemption Price shall be
made at the office or agency of the Company in the Borough of Manhattan, The
City of New York or at the Corporate Trust Office, upon presentation and
surrender of such Debentures, that interest accrued to the date fixed for
redemption shall be paid as specified in said notice and that from and after
said date interest shall cease to accrue. If less than all the Debentures are to
be redeemed, the notice to the holders of the Debentures shall specify the
particular Debentures to be redeemed. If the Debentures are to be redeemed in
part only, the notice shall state the portion of the principal amount thereof to
be redeemed and shall state that on and after the redemption date, upon
surrender of such Debenture, a new Debenture or Debentures in principal amount
equal to the unredeemed portion thereof shall be issued.
(b) Except in the case of redemption pursuant to Section 3.3(b), if
less than all the Debentures are to be redeemed, the Company shall give the
Trustee at least 45 days' notice in advance of the date fixed for redemption as
to the aggregate principal amount of Debentures to be redeemed, and thereupon
the Trustee shall select, pro rata or by lot or in such other manner as it shall
deem appropriate and fair in its discretion, the portion or portions (equal to
[$__] or any integral multiple thereof) of the Debentures to be redeemed and
shall thereafter promptly notify the Company in writing of the numbers of the
Debentures to be redeemed, in whole or in part. The Company may, if and whenever
it shall so elect pursuant to the terms hereof, by delivery of instructions
signed on its behalf by its Chairman, its President or any Vice President,
instruct the Trustee or any paying agent to call all or any part of the
Debentures for redemption and to give notice of redemption in the manner set
forth in this Section 3.4, such notice to be in the name of the Company or its
own name as the Trustee or such paying agent may deem advisable. In any case in
which notice of redemption is to be given by the Trustee or any such paying
agent, the Company shall deliver or cause to be delivered to, or permit to
remain with, the Trustee or such paying agent, as the case may be, such
Debenture Register, transfer books or other records, or suitable copies or
extracts therefrom, sufficient to enable the Trustee or such paying agent to
give any notice by mail that may be required under the provisions of this
Section 3.4.
Section 3.5 Payment Upon Redemption.
(a) If the giving of notice of redemption shall have been completed
as above provided, the Debentures or portions of Debentures to be redeemed
specified in such notice shall
19
become due and payable on the date and at the place stated in such notice at the
applicable Redemption Price, and interest on such Debentures or portions of
Debentures shall cease to accrue on and after the date fixed for redemption,
unless the Company shall default in the payment of such Redemption Price with
respect to any such Debenture or portion thereof. On presentation and surrender
of such Debentures on or after the date fixed for redemption at the place of
payment specified in the notice, said Debentures shall be paid and redeemed at
the Redemption Price (but if the date fixed for redemption is an Interest
Payment Date, the interest installment payable on such date shall be payable to
the registered holder at the close of business on the applicable record date
pursuant to Section 3.3).
(b) Upon presentation of any Debenture that is to be redeemed in
part only, the Company shall execute and the Trustee shall authenticate and the
office or agency where the Debenture is presented shall deliver to the holder
thereof, at the expense of the Company, a new Debenture of authorized
denomination in principal amount equal to the unredeemed portion of the
Debenture so presented.
Section 3.6 No Sinking Fund.
The Debentures are not entitled to the benefit of any sinking fund.
ARTICLE IV
CONVERSION OF DEBENTURES
Section 4.1 Conversion Rights.
Subject to and upon compliance with the provisions of this Article IV,
the Debentures are convertible, at the option of the Debentureholder, at any
time after 60 days after the date hereof, and on or before the close of business
on the Business Day immediately preceding the date of repayment of such
Debentures, whether at maturity or upon redemption, into fully paid and
nonassessable shares of Common Stock at an initial conversion ratio of one share
of Common Stock for each [$__] in aggregate principal amount of Debentures
(equal to an initial conversion price of $_____ per share of Common Stock),
subject to adjustment as described in this Article IV (the "Conversion Ratio").
A Debentureholder may convert any portion of the principal amount of the
Debentures into that number of fully paid and nonassessable shares of Common
Stock (calculated as to each conversion to the nearest 1/100th of a share)
obtained by multiplying (x) the quotient obtained by dividing the principal
amount of the Debentures to be converted by [$__], by (y) the Conversion Ratio.
In case a Debenture or portion thereof is called for redemption, such conversion
right in respect of the Debenture or portion so called shall expire at the close
of business on the Business Day immediately preceding the corresponding Maturity
Date, unless the Company defaults in making the payment due upon redemption.
20
Section 4.2 Conversion Procedures.
(a) To convert all or a portion of the Debentures, the
Debentureholder thereof shall deliver to the Conversion Agent an irrevocable
Conversion Request setting forth the principal amount of Debentures to be
converted, together with the name or names, if other than the Debentureholder,
in which the shares of Common Stock should be issued upon conversion and, if
such Debentures are in certificate form, surrender to the Conversion Agent the
Debentures to be converted, duly endorsed or assigned to the Company or in
blank. In addition, a Holder of Preferred Securities may exercise its right
under the Trust Agreement to exchange such Preferred Securities for Debentures
which shall be converted into Common Stock by delivering to the Conversion Agent
an irrevocable Conversion Request setting forth the information called for by
the preceding sentence and directing the Conversion Agent (i) to exchange such
Preferred Security for a portion of the Debentures held by the Trust (at an
exchange rate of [$__] principal amount of Debentures for each Preferred
Security), and (ii) to immediately convert such Debentures, on behalf of such
Debentureholder, into Common Stock pursuant to this Article IV and, if such
Preferred Securities, are held by the Holder of Preferred Securities in
certificate form surrendering such Preferred Securities, duly endorsed or
assigned to the Company or in blank. So long as any Preferred Securities are
outstanding, the Trust shall not convert any Debentures except pursuant to a
Conversion Request delivered to the Conversion Agent by a holder of Preferred
Securities.
If a Conversion Request is delivered on or after the regular record date
and prior to the subsequent Interest Payment Date, the Debentureholder shall be
required to pay to the Company the interest payable to the Debentureholder on
the subsequent Interest Payment Date prior to receiving the shares of Common
Stock, and shall be entitled to receive the interest payable on the subsequent
Interest Payment Date, on the portion of Debentures to be converted
notwithstanding the conversion thereof prior to such Interest Payment Date.
Except as provided in the immediately preceding sentence, the Company shall not
make, or be required to make, any payment, allowance or adjustment for
accumulated and unpaid interest, whether or not in arrears, on converted
Debentures; provided, however, that if notice of redemption of Debentures is
mailed or otherwise given to Debentureholders, then, if any Debentureholder
converts any Debentures into Common Stock on any date on or after the date on
which such notice of prepayment is mailed or otherwise given, and if such date
of conversion falls on any day from and including the first day of an Extended
Interest Payment Period and on or prior to the Interest Payment Date upon which
such Extended Interest Payment Period ends, such converting Debentureholder
shall be entitled to receive either (i) if the date of such conversion falls
after a regular record date and on or prior to the next succeeding Interest
Payment Date, all accrued and unpaid interest on such Debentures (including
interest thereon, if any, to the extent permitted by applicable law) to such
Interest Payment Date, or (ii) if the date of such conversion does not fall on a
date described in clause (i) above, all accrued and unpaid interest on such
Debentures (including interest thereon, if any, to the extent permitted by
applicable law) to the most recent Interest Payment Date prior to the date of
such conversion, which interest shall, in either such case, be paid to such
converting Debentureholder unless the date of conversion of such Debentures is
on or prior to the Interest Payment Date upon which such Extended Interest
Payment Period ends and after the regular record date for such Interest Payment
Date, in which
21
case such interest shall be paid to the person who was the Debentureholder at
the close of business on such regular record date. Except as otherwise set forth
above in this paragraph, in the case of any Debenture which is converted,
interest which is payable after the date of conversion of such Debenture shall
not be payable, and the Company shall not make nor be required to make any other
payment, adjustment or allowance with respect to accrued but unpaid interest
(including Additional Interest, if any) on the Debentures being converted, which
shall be deemed to be paid in full. If any Debenture called for redemption is
converted, any money deposited with the Trustee or with any paying agent or so
segregated and held in trust for the redemption of such Debenture shall (subject
to any right of the Debentureholder) be paid to the Company upon Company Request
or, if then held by the Company, shall be discharged from such trust.
Each conversion shall be deemed to have been effected immediately prior
to close of business on the day on which the Conversion Request was received
(the "Conversion Date") by the Conversion Agent from the Debentureholder or from
a holder of the Preferred Securities effecting a conversion thereof pursuant to
its conversion rights under the Trust Agreement, as the case may be. The Person
or Persons entitled to receive the Common Stock issuable upon such conversion
shall be treated for all purposes as a record holder or holders of such Common
Stock as of the Conversion Date. As promptly as practicable on or after the
Conversion Date, the Company shall issue and deliver at the office of the
Conversion Agent, unless otherwise directed by the Debentureholder in the
Conversion Request, a certificate or certificates for the number of full shares
of Common Stock issuable upon such conversion, together with the cash payment,
if any, in lieu of any fraction of any share to the Person or Persons entitled
to receive the same. The Conversion Agent shall deliver such certificate or
certificates to each Person or Persons.
(b) Subject to any right of the Debentureholder, the Company's
delivery upon conversion of the fixed number of shares of Common Stock into
which the Debentures are convertible (together with the cash payment, if any, in
lieu of fractional shares) shall be deemed to satisfy the Company's obligation
to pay the principal amount at maturity of the portion of Debentures so
converted and any unpaid interest (including Additional Interest, if any)
accrued on such Debentures at the time of such conversion.
(c) No fractional shares of Common Stock shall be issued as a result
of conversion, but in lieu thereof, the Company shall pay to the Conversion
Agent a cash adjustment in an amount equal to the same fraction of the last
reported sale price of such fractional interest on the date on which the
Debentures or Preferred Securities, as the case may be, were duly surrendered to
the Conversion Agent for conversion, or, if such day is not a Trading Day, on
the next Trading Day, and the Conversion Agent in turn shall make such payment,
if any, to the Debentureholder or the holder of the Preferred Securities so
converted.
(d) In the event of the conversion of any Debenture in part only, a
new Debenture or Debentures for the unconverted portion thereof shall be issued
in the name of the Debentureholder thereof upon the cancellation thereof in
accordance with Section 2.9.
22
(e) In effecting the conversion transactions described in this
Section 4.2, the Conversion Agent is acting as agent of the holders of Preferred
Securities (in the exchange of Preferred Securities for Debentures) and as agent
of the Debentureholders (in the conversion of Debentures into Common Stock), as
the case may be, directing it to effect such conversion transactions. The
Conversion Agent is hereby authorized (i) to exchange Preferred Securities for
Debentures held by the Trust from time to time in connection with the conversion
of such Preferred Securities in accordance with this Article IV, and (ii) to
convert all or a portion of the Debentures into Common Stock and thereupon to
deliver such shares of Common Stock in accordance with the provisions of this
Article IV and to deliver to the Trust a new Debenture or Debentures for any
resulting unconverted principal amount.
Section 4.3 Conversion Ratio Adjustments.
The Conversion Ratio shall be subject to adjustment (without
duplication) from time to time as follows:
(a) In case the Company shall, while any of the Debentures are
outstanding, (i) pay a dividend or make a distribution with respect to its
Common Stock in shares of Common Stock, (ii) subdivide its outstanding shares of
Common Stock, (iii) combine its outstanding shares of Common Stock into a
smaller number of shares, or (iv) issue by reclassification of its shares of
Common Stock any shares of capital stock of the Company, then the Conversion
Ratio in effect immediately prior to such action shall be adjusted so that the
holders of any Debentures thereafter surrendered for conversion shall be
entitled to receive the number of shares of capital stock of the Company which
he would have owned immediately following such action had such Debentures been
converted immediately prior thereto. An adjustment made pursuant to this Section
4.3(a) shall become effective immediately after the record date in the case of a
dividend or other distribution and shall become effective immediately after the
effective date in case of a subdivision, combination or reclassification (or
immediately after the record date if a record date shall have been established
for such event). If, as a result of an adjustment made pursuant to this Section
4.3(a), the holder of any Debenture thereafter surrendered for conversion shall
become entitled to receive shares of two or more classes or series of capital
stock of the Company, the Board of Directors (whose determination shall be
conclusive and shall be described in a Board Resolution filed with the Trustee)
shall determine the allocation of the adjusted Conversion Ratio between or among
shares of such classes or series of capital stock.
(b) In case the Company shall, while any of the Debentures are
outstanding, issue rights or warrants to all holders of its Common Stock
entitling them (for a period expiring within 45 days after the record date
mentioned in this Section 4.3(b)) to subscribe for or purchase shares of Common
Stock at a price per share less than the Current Market Price (as defined below)
per share of Common Stock on such record date, then the Conversion Ratio for the
Debentures shall be adjusted so that the same shall equal the ratio determined
by multiplying the Conversion Ratio in effect immediately prior to the date of
issuance of such rights or warrants by a fraction of which the numerator shall
be the number of shares of Common Stock outstanding on the date of issuance of
such rights or warrants plus the number of additional shares of Common Stock
offered for subscription or purchase, and of which the denominator shall be the
number of shares
23
of Common Stock outstanding on the date of issuance of such rights or warrants
plus the number of shares which the aggregate offering price of the total number
of shares so offered for subscription or purchase would purchase at such Current
Market Price. Such adjustment shall become effective immediately after the
record date for the determination of shareholders entitled to receive such
rights or warrants. For the purposes of this Section 4.3(b), the number of
shares of Common Stock at any time outstanding shall not include shares held in
the treasury of the Company. The Company shall not issue any rights or warrants
in respect of the shares of Common Stock held in the treasury of the Company. In
case any rights or warrants referred to in this Section 4.3(b) in respect of
which an adjustment shall have been made shall expire unexercised within 45 days
after the same shall have been distributed or issued by the Company, the
Conversion Ratio shall be readjusted at the time of such expiration to the
Conversion Ratio that would have been in effect if no adjustment had been made
on account of the distribution or issuance of such expired rights or warrants.
(c) Subject to the last sentence of this Section 4.3(c), in case the
Company shall, by dividend or otherwise, distribute to all holders of its Common
Stock evidences of its indebtedness, shares of any class or series of capital
stock, cash or assets (including securities, but excluding any rights or
warrants referred to in Section 4.3(b), any dividend or distribution paid
exclusively in cash and any dividend or distribution referred to in Section
4.3(a)), then the Conversion Ratio shall be increased so that the same shall
equal the ratio determined by multiplying the Conversion Ratio in effect
immediately prior to the effectiveness of the Conversion Ratio increase
contemplated by this Section 4.3(c) by a fraction of which the numerator shall
be the Current Market Price per share of Common Stock on the date fixed for the
payment of such distribution (the "Reference Date"), and of which the
denominator shall be, the Current Market Price per share of the Common Stock on
the Reference Date less the fair market value (as determined in good faith by
the Board of Directors, whose determination shall be conclusive and described in
a Board Resolution), on the Reference Date, of the portion of the evidences of
indebtedness, shares of capital stock, cash and assets so distributed applicable
to one share of Common Stock, such increase to become effective immediately
prior to the opening of business on the day following the Reference Date. In the
event that such dividend or distribution is not so paid or made, the Conversion
Ratio shall again be adjusted to be the Conversion Ratio which would then be in
effect if such dividend or distribution had not occurred. If the Board of
Directors determines the fair market value of any distribution for purposes of
this Section 4.3(c) by reference to the actual or when issued trading market for
any securities comprising such distribution, it must in doing so consider the
prices in such market over the same period used in computing the Current Market
Price per share of Common Stock. For purposes of this Section 4.3(c), any
dividend or distribution that includes shares of Common Stock or rights or
warrants to subscribe for or purchase shares of Common Stock shall be deemed
instead to be (1) a dividend or distribution of the evidences of indebtedness,
shares of capital stock, cash or assets other than such shares of Common Stock
or such rights or warrants (making any Conversion Ratio increase required by
this Section 4.3(c)) immediately followed by (2) a dividend or distribution of
such shares of Common Stock or such rights or warrants (making any further
Conversion Ratio increase required by Section 4.3(a) or 4.3 (b)), except (A) the
Reference Date of such dividend or distribution as defined in this Section
4.3(c) shall be substituted as (a) "the record date in the case of a dividend or
other distribution," and (b) "the
24
record date for the determination of shareholders entitled to receive such
rights or warrants," and (c) "the date fixed for such determination" within the
meaning of Sections 4.3(a) and 4.3(b), and (B) any shares of Common Stock
included in such dividend or distribution shall not be deemed outstanding for
purposes of computing any adjustment of the Conversion Ratio in Section 4.3(a).
(d) In case the Company shall pay or make a dividend or other
distribution on its Common Stock exclusively in cash (excluding all cash
dividends paid out of the retained earnings of the Company), then the Conversion
Ratio shall be increased so that the same shall equal the ratio determined by
multiplying the Conversion Ratio in effect immediately prior to the
effectiveness of the Conversion Ratio increase contemplated by this Section
4.3(d) by a fraction of which the numerator shall be the Current Market Price
per share of the Common Stock, and of which the denominator shall be the Current
Market Price per share of Common Stock on the date fixed for the payment of such
distribution less the amount of cash so distributed and not excluded as provided
applicable to one share of Common Stock on the date fixed for the payment of
such distribution, such increase to become effective immediately prior to the
opening of business on the day following the date fixed for the payment of such
distribution; provided, however, that in the event the portion of the cash so
distributed applicable to one share of Common Stock is equal to or greater than
the Current Market Price per share of the Common Stock on the record date
mentioned above, in lieu of the foregoing adjustment, adequate provision shall
be made so that each Debentureholder shall have the right to receive upon
conversion the amount of cash such Debentureholder would have received had such
Debentureholder converted each Debenture immediately prior to the record date
for the distribution of the cash. In the event that such dividend or
distribution is not so paid or made, the Conversion Ratio shall again be
adjusted to be the Conversion Ratio which would then be in effect if such record
date had not been fixed.
(e) In case a tender or exchange offer (other than an odd-lot offer)
made by the Company or any subsidiary of the Company for all or any portion of
the Common Stock shall expire and such tender or exchange offer shall involve
the payment by the Company or such subsidiary of consideration per share of
Common Stock having a fair market value (as determined in good faith by the
Board of Directors, whose determination shall be conclusive and described in a
Board Resolution) at the last time (the "Expiration Time") tenders or exchanges
may be made pursuant to such tender or exchange offer (as it shall have been
amended) that exceeds 110% of the Current Market Price per share of Common Stock
on the Trading Day next succeeding the Expiration Time, then the Conversion
Ratio shall be increased so that the same shall equal the ratio determined by
multiplying the Conversion Ratio in effect immediately prior to the
effectiveness of the Conversion Ratio increase contemplated by this Section
4.3(e) by a fraction of which the numerator shall be the sum of (x) the fair
market value (determined as aforesaid) of the aggregate consideration payable to
shareholders based on the acceptance (up to any maximum specified in the terms
of the tender or exchange offer) of all shares validly tendered or exchanged and
not withdrawn as of the Expiration Time (the shares deemed so accepted, up to
any such maximum, being referred to as the "Purchased Shares"), and (y) the
product of the number of shares of Common Stock outstanding (less any Purchased
Shares) at the Expiration Time and the Current Market Price per share of Common
Stock on the Trading Day next succeeding the Expiration Time, and of which the
denominator shall be the number of
25
shares of Common Stock outstanding (including any tendered or exchanged shares)
at the Expiration Time multiplied by the Current Market Price per share of
Common Stock on the Trading Day next succeeding the Expiration Time, such
increase to become effective immediately prior to the opening of business on the
day following the Expiration Time.
(f) For the purpose of any computation under Sections 4.3(b), (c),
(d) or (e), the "Current Market Price" per share of Common Stock on any date in
question shall be deemed to be the average of the daily Closing Prices for the
five consecutive Trading Days selected by the Company commencing not more than
20 Trading Days before, and ending not later than the earlier of the day in
question or, if applicable, the day before the "ex" date with respect to the
issuance or distribution requiring such computation; provided, however, that if
another event occurs that would require an adjustment pursuant to Sections
4.3(a) through (e), inclusive, the Board of Directors may make such adjustments
to the Closing Prices during such five Trading Day period as it deems
appropriate to effectuate the intent of the adjustments in this Section 4.3, in
which case any such determination by the Board of Directors shall be set forth
in a Board Resolution and shall be conclusive. For purposes of this Section
4.3(f), the term "ex" date, (i) when used with respect to any issuance or
distribution, means the first date on which the Common Stock trades regular way
on The Nasdaq National Market or on such successor securities quotation system
as the Common Stock may be listed or in the relevant market from which the
Closing Prices were obtained without the right to receive such issuance or
distribution, and (ii) when used with respect to any tender or exchange offer,
means the first date on which the Common Stock trades regular way on such
securities exchange or in such market after the Expiration Time of such offer.
(g) The Company may make such increases in the Conversion Ratio, in
addition to those required by Sections (a) through (e), as it considers to be
advisable to avoid or diminish any income tax to holders of Common Stock or
rights to purchase Common Stock resulting from any dividend or distribution of
stock (or rights to acquire stock) or from any event treated as such for income
tax purposes. The Company from time to time may increase the Conversion Ratio by
any amount for any period of time if the period is at least 20 days, the
increase is irrevocable during the period, and the Board of Directors shall have
made a determination that such increase would be in the best interest of the
Company, which determination shall be conclusive. Whenever the Conversion Ratio
is increased pursuant to the preceding sentence, the Company shall mail to
Debentureholders of record a notice of the increase at least fifteen days prior
to the date the increased Conversion Ratio takes effect, and such notice shall
state the increased Conversion Ratio and the period it shall be in effect.
(h) No adjustment in the Conversion Ratio shall be required unless
such adjustment would require an increase or decrease of at least 1% in the
Conversion Ratio; provided, however, that any adjustments which by reason of
this Section 4.3(h) are not required to be made shall be carried forward and
taken into account in determining whether any subsequent adjustment shall be
required. The adjusted Conversion Ratio will be rounded to four decimal places.
(i) If any action would require adjustment of the Conversion Ratio
pursuant to more than one of the provisions described above, only one adjustment
shall be made and such
26
adjustment shall be the amount of adjustment that has the highest absolute value
to the Debentureholders.
Section 4.4 Reclassification, Consolidation, Merger or Sale of Assets.
In the event that the Company shall be a party to any transaction,
including without limitation (a) any recapitalization or reclassification of the
Common Stock (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination of the Common Stock), (b) any consolidation of the Company with, or
merger of the Company into any other Person, any merger of another Person into
the Company (other than a merger which does not result in a reclassification,
conversion, exchange or cancellation of outstanding shares of Common Stock of
the Company), (c) any sale, transfer or lease of all or substantially all of the
assets of the Company, or (d) any compulsory share exchange, in each case
pursuant to which the Common Stock is converted into the right to receive other
securities, cash or other property, then lawful provision shall be made as part
of the terms of such transaction whereby the holder of each Debenture then
outstanding shall have the right thereafter to convert each Debenture only into
the kind and amount of securities, cash or other property receivable upon
consummation of such transaction by a holder of the number of shares of Common
Stock of the Company into which such Debenture could have been converted
immediately prior to such transaction.
The Company or the Person formed by such consolidation or resulting from
such merger or which acquired such assets or which acquires the shares of the
Company, as the case may be, shall make provision in its certificate or articles
of incorporation or other constituent document to establish such right. Such
certificate or articles of incorporation or other constituent document shall
provide for adjustments which, for events subsequent to the effective date of
such certificate or articles of incorporation or other constitution document,
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Article IV. The above provisions shall similarly apply to successive
transactions of the foregoing type.
Section 4.5 Notice of Adjustments of Conversion Ratio.
Whenever the Conversion Ratio is adjusted as herein provided:
(a) The Company shall compute the adjusted Conversion Ratio and
shall prepare a certificate signed by the Chairman of the Board,
President or a Vice President of the Company and by its
Treasurer or an Assistant Treasurer of the Company setting forth
the adjusted Conversion Ratio and showing in reasonable detail
the facts upon which such adjustment is based, and such
certificate shall forthwith be filed with the Trustee, the
Conversion Agent and the transfer agent for the Preferred
Securities and the Debentures; and
(b) a notice stating that the Conversion Ratio has been adjusted and
setting forth the adjusted Conversion Ratio shall as soon as
practicable be mailed by the Company to all record holders of
Preferred Securities and the Debentures at their last
27
addresses as they appear upon the stock transfer books of the
Company and the Trust.
Section 4.6 Prior Notice of Certain Events.
In case:
(a) the Company shall (i) declare any dividend (or any other
distribution) on its Common Stock, other than (A) a dividend payable in shares
of Common Stock, or (B) a dividend payable in cash that would not require an
adjustment pursuant to Section 4.3(c) or (d), or (ii) authorize a tender or
exchange offer that would require an adjustment pursuant to Section 4.3(e);
(b) the Company shall authorize the granting to all holders of
Common Stock of rights or warrants to subscribe for or purchase any shares of
stock of any class or series or of any other rights or warrants;
(c) of any reclassification of Common Stock (other than a
subdivision or combination of the outstanding Common Stock, or a change in par
value, or from par value to no par value, or from no par value to par value), or
of any consolidation or merger to which the Company is a party and for which
approval of any shareholders of the Company shall be required, or the sale or
transfer of all or substantially all of the assets of the Company or of any
compulsory share exchange whereby the Common Stock is converted into other
securities, cash or other property; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; then the Company shall (1) if any Preferred
Securities are outstanding, cause to be filed with the transfer agent for the
Preferred Securities, and shall cause to be mailed to the holders of record of
the Preferred Securities, at their last addresses as they shall appear upon the
securities register of the Trust, or (2) shall cause to be mailed to all
Debentureholders at their last addresses as they shall appear in the Debenture
Register, at least fifteen days prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a record (if any)
is to be taken for the purpose of such dividend, distribution, rights or
warrants or, if a record is not to be taken, the date as of which the holders of
Common Stock of record to be entitled to such dividend, distribution, rights or
warrants are to be determined, or (y) the date on which such reclassification,
consolidation, merger, sale, transfer, share exchange, dissolution, liquidation
or winding up is expected to become effective, and the date as of which it is
expected that holders of Common Stock of record shall be entitled to exchange
their shares of Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer, share
exchange, dissolution, liquidation or winding up (but no failure to mail such
notice or any defect therein or in the mailing thereof shall affect the validity
of the corporate action required to be specified in such notice).
28
Section 4.7 Certain Defined Terms.
The following definitions shall apply to terms used in this Article IV:
(a) "Closing Prices" of any security on any day shall mean the last
reported sale price for such security, regular way, on such day or, if no sale
takes place on such day, the average of the reported closing bid and asked
prices on such day, regular way, of such security, in either case as reported on
the National Market System of the National Association of Securities Dealers,
Inc. or, if such security is not quoted or admitted to trading on such quotation
system, on the principal quotation system on which such security is listed or
admitted to trading or quoted, or, if not listed or admitted to trading or
quoted on any national securities exchange or quotation system, the average of
the closing bid and asked prices of such security in the over-the-counter market
on the day in question as reported by the National Quotation Bureau
Incorporated, or a similar generally accepted reporting service, or, if not so
available in such manner, as furnished by any Nasdaq member firm selected from
time to time by the Board of Directors for that purpose or, if not so available
in such manner, as otherwise determined in good faith by the Board of Directors.
(b) "Trading Day" shall mean a day on which securities are traded on
the national securities exchange or quotation system used to determine the
Closing Price.
Section 4.8 Dividend or Interest Reinvestment Plans.
Notwithstanding the foregoing provisions, the issuance of any shares of
Common Stock pursuant to any plan providing for the reinvestment of dividends or
interest payable on securities of the Company and the investment of additional
optional amounts in shares of Common Stock under any such plan, and the issuance
of any shares of Common Stock or options or rights to purchase such shares
pursuant to any employee benefit plan or program of the Company or pursuant to
any option, warrant, right or exercisable, exchangeable or convertible security
outstanding as of the date the Debentures were first issued, shall not be deemed
to constitute an issuance of Common Stock or exercisable, exchangeable or
convertible securities by the Company to which any of the adjustment provisions
described above shall apply. There also shall be no adjustment of the Conversion
Ratio in case of the issuance of any stock (or securities convertible into or
exchangeable for stock) of the Company except as specifically described in this
Article IV.
Section 4.9 Certain Additional Rights.
In case the Company shall, by dividend or otherwise, declare or make a
distribution on its Common Stock referred to in Section 4.3(c) or (d)
(including, without limitation, dividends or distributions referred to in the
last sentence of Section 4.3(c)), then the Debentureholders, upon the conversion
thereof subsequent to the close of business on the date fixed for the
determination of shareholders entitled to receive such distribution and prior to
the effectiveness of the Conversion Ratio adjustment in respect of such
distribution, also shall be entitled to receive for each share of Common Stock
into which the Debentures are converted, the portion of the shares
29
of Common Stock, rights, warrants, evidences of indebtedness, shares of capital
stock, cash and assets so distributed applicable to one share of Common Stock;
provided, however, that, at the election of the Company (whose election shall be
evidenced by a Board Resolution) with respect to all Debentureholders so
converting, the Company may, in lieu of distributing to such Debentureholder any
portion of such distribution not consisting of cash or securities of the
Company, pay such Debentureholder an amount in cash equal to the fair market
value thereof (as determined in good faith by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution). If any
conversion of Debentures described in the immediately preceding sentence occurs
prior to the payment date for a distribution to holders of Common Stock which
the Debentureholders so converted is entitled to receive in accordance with the
immediately preceding sentence, the Company may elect (such election to be
evidenced by a Board Resolution) to distribute to such Debentureholder a due
xxxx for the shares of Common Stock, rights, warrants, evidences of
indebtedness, shares of capital stock, cash or assets to which such
Debentureholder is so entitled, provided, that such due xxxx (i) meets any
applicable requirements of the principal national securities quotation system or
other market on which the Common Stock is then traded, and (ii) requires payment
or delivery of such shares of Common Stock, rights, warrants, evidences of
indebtedness, shares of capital stock, cash or assets no later than the date of
payment or delivery thereof to holders of shares of Common Stock receiving such
distribution.
Section 4.10 Trustee Not Responsible for Determining Conversion Ratio or
Adjustments.
Neither the Trustee nor any Conversion Agent shall at any time be under
any duty or responsibility to any Debentureholder or other Person to determine
or otherwise verify any Conversion Ratio or to determine whether any facts exist
which may require any adjustment of the Conversion Ratio, or with respect to the
nature or extent of any such adjustment when made, or with respect to the method
employed, or herein or in any supplemental indenture provided to be employed, in
making the same. Neither the Trustee nor any Conversion Agent shall be
accountable with respect to the validity or value (or the kind of account) of
any shares of Common Stock or of any securities or property, which may at any
time be issued or delivered upon the conversion of any Debenture; and neither
the Trustee nor any Conversion Agent makes any representation with respect
thereto. Neither the Trustee nor any Conversion Agent shall be responsible for
any failure of the Company to make any cash payment or to issue, transfer or
deliver any shares of Common Stock or stock certificates or other securities or
property upon the surrender of any Debenture for the purpose of conversion, or
to comply with any of the covenants of the Company contained in Article VI or
this Article IV.
ARTICLE V
EXTENSION OF INTEREST PAYMENT PERIOD
Section 5.1 Extension of Interest Payment Period.
The Company shall have the right, at any time and from time to time
during the term of the Debentures so long as no Event of Default has occurred
and is continuing, to defer payments
30
of interest by extending the interest payment period of such Debentures for a
period not exceeding 20 consecutive quarters (the "Extended Interest Payment
Period"), during which Extended Interest Payment Period no interest shall be due
and payable; provided that no Extended Interest Payment Period may extend beyond
the Maturity Date or end on a date other than an Interest Payment Date. To the
extent permitted by applicable law, interest, the payment of which has been
deferred because of the extension of the interest payment period pursuant to
this Section 5.1, shall bear interest thereon at the Coupon Rate compounded
quarterly for each quarter of the Extended Interest Payment Period ("Compounded
Interest"). At the end of the Extended Interest Payment Period, the Company
shall calculate (and deliver such calculation to the Trustee) and pay all
interest accrued and unpaid on the Debentures, including any Additional Interest
and Compounded Interest (together, "Deferred Interest") that shall be payable to
the holders of the Debentures in whose names the Debentures are registered in
the Debenture Register on the first record date after the end of the Extended
Interest Payment Period. Before the termination of any Extended Interest Payment
Period, the Company may further extend such period so long as no Event of
Default has occurred and is continuing, provided that such period together with
all such further extensions thereof shall not exceed 20 consecutive quarters, or
extend beyond the Maturity Date of the Debentures or end on a date other than an
Interest Payment Date. Upon the termination of any Extended Interest Payment
Period and upon the payment of all Deferred Interest then due, the Company may
commence a new Extended Interest Payment Period, subject to the foregoing
requirements. No interest shall be due and payable during an Extended Interest
Payment Period, except at the end thereof, but the Company may prepay at any
time all or any portion of the interest accrued during an Extended Interest
Payment Period.
Section 5.2 Notice of Extension.
(a) If the Property Trustee is the only registered holder of the
Debentures at the time the Company selects an Extended Interest Payment Period,
the Company shall give written notice to the Administrative Trustees, the
Property Trustee and the Trustee of its selection of such Extended Interest
Payment Period two Business Days before the earlier of (i) the next succeeding
date on which Distributions on the Trust Securities issued by the Trust are
payable; or (ii) the date the Trust is required to give notice of the record
date, or the date such Distributions are payable, to The Nasdaq National Market
or other applicable self-regulatory organization or to holders of the Preferred
Securities issued by the Trust, but in any event at least one Business Day
before such record date.
(b) If the Property Trustee is not the only holder of the Debentures
at the time the Company selects an Extended Interest Payment Period, the Company
shall give the holders of the Debentures and the Trustee written notice of its
selection of such Extended Interest Payment Period at least two Business Days
before the earlier of (i) the next succeeding Interest Payment Date; or (ii) the
date the Company is required to give notice of the record or payment date of
such interest payment to The Nasdaq National Market or other applicable
self-regulatory organization or to holders of the Debentures.
31
(c) The quarter in which any notice is given pursuant to paragraphs
(a) or (b) of this Section 5.2 shall be counted as one of the 20 quarters
permitted in the maximum Extended Interest Payment Period permitted under
Section 5.1.
Section 5.3 Limitation on Transactions.
If (i) the Company shall exercise its right to defer payment of interest
as provided in Section 5.1, or (ii) there shall have occurred and be continuing
any Event of Default, then (a) the Company shall not declare or pay any dividend
on, make any distributions with respect to, or redeem, purchase, acquire or make
a liquidation payment with respect to, any of its capital stock (other than (A)
dividends or distributions in common stock of the Company, or any declaration of
a non-cash dividend in connection with the implementation of a shareholder
rights plan, or the issuance of stock under any such plan in the future, or the
redemption or repurchase of any such rights pursuant thereto, (B) purchases of
common stock of the Company related to the rights under any of the Company's
benefit plans for its directors, officers or employees, or (C) as a result of a
reclassification of its capital stock for another class of its capital stock);
(b) the Company shall not make any payment of interest, principal or premium, if
any, or repay, repurchase or redeem any debt securities issued by the Company
which rank pari passu with or junior to the Debentures or make any guarantee
payment with respect to any guarantee by the Company of the debt securities of
any subsidiary of the Company if such guarantee ranks pari passu with or junior
to the Debentures; provided, however, that notwithstanding the foregoing the
Company may make payments pursuant to its obligations under the Preferred
Securities Guarantee; and (c) the Company shall not redeem, purchase or acquire
less than all of the outstanding Debentures or any of the Preferred Securities.
ARTICLE VI
PARTICULAR COVENANTS OF THE COMPANY
Section 6.1 Payment of Principal and Interest.
The Company shall duly and punctually pay or cause to be paid the
principal of and interest on the Debentures at the time and place and in the
manner provided herein. Each such payment of the principal of and interest on
the Debentures shall relate only to the Debentures, shall not be combined with
any other payment of the principal of or interest on any other obligation of the
Company, and shall be clearly and unmistakably identified as pertaining to the
Debentures.
Section 6.2 Maintenance of Agency.
So long as any of the Debentures remain Outstanding, the Company shall
maintain, or shall cause to be maintained, an office or agency in the Borough of
Manhattan, The City of New York, or at such other location or locations as may
be designated as provided in this Section 6.2, where (i) Debentures may be
presented for payment; (ii) Debentures may be presented as herein above
authorized for registration of transfer, conversion or exchange; and (iii)
notices and
32
demands to or upon the Company in respect of the Debentures and this Indenture
may be given or served, such designation to continue with respect to such office
or agency until the Company shall, by written notice signed by its President or
an Executive Vice President and delivered to the Trustee, designate some other
office or agency for such purposes or any of them. 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 thereof, such presentations, 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, notices and demands. In addition to any such office or agency,
the Company may from time to time designate one or more offices or agencies
outside of the Borough of Manhattan, The City of New York, where the Debentures
may be presented for registration or transfer and for exchange in the manner
provided herein, and the Company may from time to time rescind such designation
as the Company may deem desirable or expedient. The Company shall give the
Trustee prompt written notice of any such designation or rescission thereof.
Section 6.3 Paying Agents.
(a) The Company shall be the initial paying agent. If the Company
shall appoint one or more paying agents for the Debentures, other than the
Trustee, the Company shall cause each such paying agent to execute and deliver
to the Trustee an instrument in which such agent shall agree with the Trustee,
subject to the provisions of this Section 6.3:
(i) that it shall hold all sums held by it as such agent for
the payment of the principal of or interest on the Debentures (whether
such sums have been paid to it by the Company or by any other obligor of
such Debentures) in trust for the benefit of the Persons entitled
thereto;
(ii) that it shall give the Trustee notice of any failure by
the Company (or by any other obligor of such Debentures) to make any
payment of the principal of or interest on the Debentures when the same
shall be due and payable;
(iii) that it shall, at any time during the continuance of any
failure referred to in the preceding paragraph (a)(ii) above, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such paying agent; and
(iv) that it shall perform all other duties of paying agent
as set forth in this Indenture.
(b) If the Company shall act as its own paying agent with respect to
the Debentures, it shall on or before each due date of the principal of or
interest on such Debentures, set aside, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum sufficient to pay such principal
or interest so becoming due on Debentures until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and shall promptly notify
the Trustee of such action, or any failure (by it or any other obligor on such
Debentures) to take such action. Whenever the Company shall have one or more
paying agents for the Debentures, it shall, prior
33
to each due date of the principal of or interest on any Debentures, deposit with
the paying agent a sum sufficient to pay the principal or interest so becoming
due, such sum to be held in trust for the benefit of the Persons entitled to
such principal or interest, and (unless such paying agent is the Trustee) the
Company shall promptly notify the Trustee of this action or failure so to act.
(c) Notwithstanding anything in this Section 6.3 to the contrary,
(i) the agreement to hold sums in trust as provided in this Section 6.3 is
subject to the provisions of Section 14.3 and 14.4; and (ii) 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 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 and conditions 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.
Section 6.4 Appointment to Fill Vacancy in Office of Trustee.
The Company, whenever necessary to avoid or fill a vacancy in the office
of Trustee, shall appoint, in the manner provided in Section 10.11, a Trustee,
so that there shall at all times be a Trustee hereunder.
Section 6.5 Compliance with Consolidation Provisions.
The Company shall not, while any of the Debentures remain outstanding,
consolidate with, or merge into, or merge into itself, or sell or convey all or
substantially all of its property to any other company unless the provisions of
Article XIII hereof are complied with.
Section 6.6 Limitation on Transactions.
If Debentures are issued to the Trust or a trustee of the Trust in
connection with the issuance of Trust Securities by the Trust and (i) there
shall have occurred any event that would constitute an Event of Default; (ii)
the Company shall be in default with respect to any of its obligations under the
Preferred Securities Guarantee relating to the Trust; or (iii) the Company shall
have given notice of its election to defer payments of interest on such
Debentures by extending the interest payment period as provided in this
Indenture and such period, or any extension thereof, shall be continuing, then
(a) the Company shall not declare or pay any dividend on, make any distributions
with respect to, or redeem, purchase, acquire or make a liquidation payment with
respect to, any of its capital stock (other than (A) dividends or distributions
in common stock of the Company, or any declaration of a non-cash dividend in
connection with the implementation of a shareholder rights plan, or the issuance
of stock under any such plan in the future, or the redemption or repurchase of
any such rights pursuant thereto, (B) purchases of common stock of the Company
related to the rights under any of the Company's benefit plans for its
directors, officers or employees, or (C) as a result of a reclassification of
its capital stock); and (b) the Company shall not make any payment of interest,
principal or premium, if any, or repay, repurchase or redeem any debt securities
issued by the Company which rank pari passu with or junior to the Debentures or
make any guarantee payments with
34
respect to any guarantee by the Company of the debt securities of any subsidiary
of the Company if such guarantee ranks pari passu with or junior in interest to
the Debentures; provided, however, that the Company may make payments pursuant
to its obligations under the Preferred Securities Guarantee; and (c) the Company
shall not redeem, purchase or acquire less than all of the outstanding
Debentures or any of the Preferred Securities.
Section 6.7 Covenants as to the Trust.
For so long as such Trust Securities of the Trust remain outstanding,
the Company shall (i) maintain 100% direct or indirect ownership of the Common
Securities of the Trust; provided, however, that any permitted successor of the
Company under this Indenture may succeed to the Company's ownership of the
Common Securities; use its reasonable efforts to cause the Trust (a) to remain a
business trust (and to avoid involuntary termination, winding up or
liquidation), except in connection with a distribution of Debentures, the
redemption of all of the Trust Securities of the Trust or certain mergers,
consolidations or amalgamations, each as permitted by the Trust Agreement; and
(b) to otherwise continue not to be treated as an association taxable as a
corporation or partnership for United States federal income tax purposes; (iii)
use its reasonable efforts to cause each holder of Trust Securities to be
treated as owning an individual beneficial interest in the Debentures; and (iv)
the Company, and any successor to the Company, shall use reasonable efforts to
maintain the eligibility of the Preferred Securities for quotation or listing on
any national securities exchange or other organization on which the Preferred
Securities are then quoted or listed (including, if applicable, the Nasdaq
National Market) and shall use reasonable efforts to keep the Preferred
Securities so quoted or listed for so long as the Preferred Securities remain
outstanding. In connection with the distribution of the Debentures to the
holders of the Preferred Securities issued by the Trust upon a Dissolution
Event, the Company shall use its best efforts to list such Debentures on The
Nasdaq National Market or on such other exchange as the Preferred Securities are
then listed.
Section 6.8 Covenants as to Purchases.
Except upon the exercise by the Company of its right to redeem the
Debentures pursuant to Section 3.2 upon the occurrence and continuation of a
Special Event or pursuant to Section 3.3(b), prior to [December 31, 2003], the
Company shall not purchase any Debentures, in whole or in part, from the Trust.
Section 6.9 Waiver of Usury, Stay or Extension Laws.
To the fullest extent permitted by law (i) the Company shall not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any usury, stay or extension law wherever enacted, now
or at any time hereafter in force, which may affect the covenants or the
performances of this Indenture, and (ii) the Company hereby expressly waives 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.
35
ARTICLE VII
DEBENTUREHOLDERS' LISTS AND REPORTS
BY THE COMPANY AND THE TRUSTEE
Section 7.1 Company to Furnish Trustee Names and Addresses of Debentureholders.
The Company shall furnish or cause to be furnished to the Trustee (a)
on a quarterly basis on each regular record date (as described in Section 2.5) a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the holders of the Debentures as of such regular record date,
provided that the Company shall not be obligated to furnish or cause to be
furnished such list at any time that the list shall not differ in any respect
from the most recent list furnished to the Trustee by the Company (in the event
the Company fails to provide such list on a quarterly basis, the Trustee shall
be entitled to rely on the most recent list provided by the Company); and (b) 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, in either case, no such list need be furnished if the
Trustee shall be the Debenture Registrar.
Section 7.2 Preservation of Information Communications with Debentureholders.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the holders of
Debentures contained in the most recent list furnished to it as provided in
Section 7.1 and as to the names and addresses of holders of Debentures received
by the Trustee in its capacity as Debenture Registrar (if acting in such
capacity).
(b) The Trustee may destroy any list furnished to it as provided in
Section 7.1 upon receipt of a new list so furnished.
(c) Debentureholders may communicate as provided in Section 312(b) of
the Trust Indenture Act with other Debentureholders with respect to their rights
under this Indenture or under the Debentures.
Section 7.3 Reports by the Company.
(a) The Company covenants and agrees to 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) that the Company may be required to
file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange
Act; or, if the Company is not required to file information, documents or
reports pursuant to either of such sections, then to file with the Trustee and
the Commission, in accordance with the rules and regulations prescribed from
time to time by the Commission, such of the supplementary and periodic
information, documents and reports that may be required
36
pursuant to Section 13 of the Exchange Act 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.
(b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed from time to
time by the Commission, such additional information, documents and reports with
respect to compliance by the Company with the conditions and covenants provided
for in this Indenture as may be required from time to time by such rules and
regulations.
(c) The Company covenants and agrees to transmit by mail, first class
postage prepaid, or reputable overnight delivery service that provides for
evidence of receipt, to the Debentureholders, as their names and addresses
appear upon the Debenture Register, within 30 days after the filing thereof with
the Trustee, such summaries of any information, documents and reports required
to be filed by the Company pursuant to subsections (a) and (b) of this Section
7.3 as may be required by rules and regulations prescribed from time to time by
the Commission.
Section 7.4 Reports by the Trustee.
(a) On or before July 31 in each year in which any of the Debentures are
Outstanding, the Trustee shall transmit by mail, first class postage prepaid, to
the Debentureholders, as their names and addresses appear upon the Debenture
Register, a brief report dated as of the preceding June 30, if and to the extent
required under Section 313(a) of the Trust Indenture Act.
(b) The Trustee shall comply with Section 313(b) and 313(c) of the Trust
Indenture Act.
(c) A copy of each such report shall, at the time of such transmission
to Debentureholders, be filed by the Trustee with the Company, with each stock
exchange upon which any Debentures are listed (if so listed) and also with the
Commission. The Company agrees to notify the Trustee when any Debentures become
listed on any stock exchange.
ARTICLE VIII
REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS
ON EVENT OF DEFAULT
Section 8.1 Events of Default.
(a) Whenever used herein with respect to the Debentures, "Event of
Default" means any one or more of the following events that has occurred and is
continuing:
(i) the Company defaults in the payment of any installment of
interest upon any of the Debentures, as and when the same shall become
due and payable, and continuance of such default for a period of 30
days; provided, however, that a valid extension of an
37
interest payment period by the Company in accordance with the terms of
this Indenture shall not constitute a default in the payment of interest
for this purpose;
(ii) the Company defaults in the payment of the principal on the
Debentures as and when the same shall become due and payable whether at
maturity, upon redemption, by declaration or otherwise;
(iii) the Company fails to observe or perform any other of its
covenants or agreements with respect to the Debentures for a period of
90 days after the date on which written notice of such failure,
requiring the same to be remedied and stating that such notice is a
"Notice of Default" hereunder, shall have been given to the Company by
the Trustee, by registered or certified mail, or to the Company and the
Trustee by the holders of at least 25% in principal amount of the
Debentures at the time Outstanding;
(iv) the Company pursuant to or within the meaning of any
Bankruptcy Law (i) commences a voluntary case; (ii) consents to the
entry of an order for relief against it in an involuntary case; (iii)
consents to the appointment of a Custodian of it or for all or
substantially all of its property; or (iv) makes a general assignment
for the benefit of its creditors;
(v) a court of competent jurisdiction enters an order under any
Bankruptcy Law that (i) is for relief against the Company in an
involuntary case; (ii) appoints a Custodian of the Company for all or
substantially all of its property; or (iii) orders the liquidation of
the Company, and the order or decree remains unstayed and in effect for
90 days; or
(vi) the Trust shall have voluntarily or involuntarily
dissolved, wound-up its business or otherwise terminated its existence
except in connection with (i) the distribution of Debentures to holders
of Trust Securities in liquidation of their interests in the Trust; (ii)
the redemption of all of the outstanding Trust Securities of the Trust;
or (iii) certain mergers, consolidations or amalgamations, each as
permitted by the Trust Agreement.
(b) In each and every such case referred to in paragraph (i) through
(vi) of Section 8.1(a), unless the principal of all the Debentures shall have
already become due and payable, either the Trustee or the holders of not less
than 25% in aggregate principal amount of the Debentures then Outstanding
hereunder, by notice in writing to the Company (and to the Trustee if given by
such Debentureholders) may declare the principal of all the Debentures to be due
and payable immediately, and upon any such declaration the same shall become and
shall be immediately due and payable, notwithstanding anything contained in this
Indenture or in the Debentures.
(c) At any time after the principal of the Debentures shall have been so
declared due and payable, and before any judgment or decree for the payment of
the moneys due shall have been obtained or entered as hereinafter provided, the
holders of not less than a majority in aggregate principal amount of the
Debentures then Outstanding hereunder, by written notice to the
38
Company and the Trustee, may rescind and annul such declaration and its
consequences if: (i) the Company has paid or deposited with the Trustee a sum
sufficient to pay all matured installments of interest upon all the Debentures
and the principal of any and all Debentures that shall have become due otherwise
than by acceleration (with interest upon such principal, and, to the extent that
such payment is enforceable under applicable law, upon overdue installments of
interest, at the rate per annum expressed in the Debentures to the date of such
payment or deposit) and the amount payable to the Trustee under Section 10.7;
and (ii) any and all Events of Default under this Indenture, other than the
nonpayment of principal on Debentures that shall not have become due by their
terms, shall have been remedied or waived as provided in Section 8.6. No such
rescission and annulment shall extend to or shall affect any subsequent default
or impair any right consequent thereon.
(d) In case the Trustee shall have proceeded to enforce any right with
respect to Debentures under this Indenture and such proceedings shall have been
discontinued or abandoned because of such rescission or annulment or for any
other reason or shall have been determined adversely to the Trustee, then and in
every such case the Company and the Trustee shall be restored respectively to
their former positions and rights hereunder, and all rights, remedies and powers
of the Company and the Trustee shall continue as though no such proceedings had
been taken.
Section 8.2 Collection of Indebtedness and Suits for Enforcement by Trustee.
(a) The Company covenants that (1) in case it shall default in the
payment of any installment of interest on any of the Debentures, and such
default shall have continued for a period of 30 days; or (2) in case it shall
default in the payment of the principal of any of the Debentures when the same
shall have become due and payable, whether upon maturity of the Debentures or
upon redemption or upon declaration or otherwise, then, upon demand of the
Trustee, the Company shall pay to the Trustee, for the benefit of the holders of
the Debentures, the whole amount that then shall have become due and payable on
all such Debentures for principal or interest, or both, as the case may be, with
interest upon the overdue principal and (to the extent that payment of such
interest is enforceable under applicable law and, if the Debentures are held by
the Trust or a trustee of the Trust, without duplication of any other amounts
paid by the Trust or trustee in respect thereof) upon overdue installments of
interest at the rate per annum expressed in the Debentures; and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, and the amount payable to the Trustee under Section
10.7.
(b) If the Company shall fail to pay such amounts set forth in Section
8.2(a) forthwith upon such demand, the Trustee, in its own name and as trustee
of an express trust, shall be entitled and empowered to institute any action or
proceedings at law or in equity for the collection of the sums so due and
unpaid, and may prosecute any such action or proceeding to judgment or final
decree, and may enforce any such judgment or final decree against the Company or
other obligor upon the Debentures and collect the moneys adjudged or decreed to
be payable in the manner provided by law out of the property of the Company or
other obligor upon the Debentures, wherever situated.
39
(c) In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, readjustment, arrangement, composition or judicial proceedings
affecting the Company, the Trust, or the creditors or property of either, the
Trustee shall have power to intervene in such proceedings and take any action
therein that may be permitted by the court and shall (except as may be otherwise
provided by law) be entitled to file such proofs of claim and other papers and
documents as may be necessary or advisable in order to have the claims of the
Trustee and of the holders of the Debentures allowed for the entire amount due
and payable by the Company under this Indenture at the date of institution of
such proceedings and for any additional amount that may become due and payable
by the Company after such date, and to collect and receive any moneys or other
property payable or deliverable on any such claim, and to distribute the same
after the deduction of the amount payable to the Trustee under Section 10.7; and
any receiver, assignee or trustee in bankruptcy or reorganization is hereby
authorized by each of the holders of the Debentures to make such payments to the
Trustee, and, in the event that the Trustee shall consent to the making of such
payments directly to such Debentureholders, to pay to the Trustee any amount due
it under Section 10.7.
(d) All rights of action and of asserting claims under this Indenture,
or under any of the terms established with respect to the Debentures, may be
enforced by the Trustee without the possession of any of such Debentures, or the
production thereof at any trial or other proceeding relative thereto, and any
such suit or proceeding instituted by the Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment shall, after
provision for payment to the Trustee of any amounts due under Section 10.7, be
for the ratable benefit of the holders of the Debentures. In case of an Event of
Default hereunder, the Trustee may in its discretion proceed to protect and
enforce the rights vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
of such rights, either at law or in equity or in bankruptcy or otherwise,
whether for the specific enforcement of any covenant or agreement contained in
this Indenture or in aid of the exercise of any power granted in this Indenture,
or to enforce any other legal or equitable right vested in the Trustee by this
Indenture or by law. Nothing contained herein shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Debentureholder any plan of reorganization, arrangement, adjustment or
composition affecting the Debentures or the rights of any holder thereof or to
authorize the Trustee to vote in respect of the claim of any Debentureholder in
any such proceeding.
Section 8.3 Application of Moneys Collected.
Any moneys or other assets collected by the Trustee pursuant to this
Article VIII with respect to the Debentures shall be applied in the following
order, at the date or dates fixed by the Trustee and, in case of the
distribution of such moneys or other assets on account of principal or interest,
upon presentation of the Debentures, and notation thereon the payment, if only
partially paid, and upon surrender thereof if fully paid:
FIRST: To the payment of costs and expenses of collection and of all
amounts payable to the Trustee under Section 10.7;
40
SECOND: To the payment of all Senior Indebtedness of the Company if and
to the extent required by Article XVII; and
THIRD: To the payment of the amounts then due and unpaid upon the
Debentures for principal and interest, in respect of which or for the benefit of
which such money has been collected, ratably, without preference or priority of
any kind, according to the amounts due and payable on such Debentures for
principal and interest, respectively.
Section 8.4 Limitation on Suits.
(a) Except as set forth in this Indenture, no holder of any Debenture
shall have any right by virtue or by availing of any provision of this Indenture
to institute any suit, action or proceeding in equity or at law upon or under or
with respect to this Indenture or for the appointment of a receiver or trustee,
or for any other remedy hereunder, unless (i) such holder previously shall have
given to the Trustee written notice of an Event of Default and of the
continuance thereof with respect to the Debentures specifying such Event of
Default, as hereinbefore provided; (ii) the holders of not less than 25% in
aggregate principal amount of the Debentures then Outstanding shall have made
written request upon the Trustee to institute such action, suit or proceeding in
its own name as trustee hereunder; (iii) such holder or holders shall have
offered to the Trustee such reasonable indemnity as it may require against the
costs, expenses and liabilities to be incurred therein or thereby; (iv) the
Trustee for 60 days after its receipt of such notice, request and offer of
indemnity, shall have failed to institute any such action, suit or proceeding;
and (v) during such 60 day period, the holders of not less than a majority in
principal amount of the Debentures do not give the Trustee a direction
inconsistent with the request.
(b) Notwithstanding anything contained herein to the contrary or any
other provisions of this Indenture, the right of any holder of the Debentures to
receive payment of the principal of and interest on the Debentures, as therein
provided, on or after the respective due dates expressed in such Debenture (or
in the case of redemption, on the redemption date), or to institute suit for the
enforcement of any such payment on or after such respective dates or redemption
date, shall not be impaired or affected without the consent of such holder and
by accepting a Debenture hereunder it is expressly understood, intended and
covenanted by the taker and holder of every Debenture with every other such
taker and holder and the Trustee, that no one or more holders of Debentures
shall have any right in any manner whatsoever by virtue or by availing of any
provision of this Indenture to affect, disturb or prejudice the rights of the
holders of any other of such Debentures, or to obtain or seek to obtain priority
over or preference to any other such holder, or to enforce any right under this
Indenture, except in the manner herein provided and for the equal, ratable and
common benefit of all holders of Debentures. For the protection and enforcement
of the provisions of this Section 8.4, each and every Debentureholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
41
Section 8.5 Rights and Remedies Cumulative; Delay or Omission not Waiver.
(a) Except as otherwise provided in Section 2.9(b), all powers and
remedies given by this Article VIII to the Trustee or to the Debentureholders
shall, to the extent permitted by law, be deemed cumulative and not exclusive of
any other powers and remedies available to the Trustee or the holders of the
Debentures, by judicial proceedings or otherwise, to enforce the performance or
observance of the covenants and agreements contained in this Indenture or
otherwise established with respect to such Debentures.
(b) No delay or omission of the Trustee or of any holder of any of the
Debentures to exercise any right or power accruing upon any Event of Default
occurring and continuing as aforesaid shall impair any such right or power, or
shall be construed to be a waiver of any such default or an acquiescence
therein; and, subject to the provisions of Section 8.4, every power and remedy
given by this Article VIII or by law to the Trustee or the Debentureholders may
be exercised from time to time, and as often as shall be deemed expedient, by
the Trustee or by the Debentureholders.
Section 8.6 Control by Debentureholders.
The holders of not less than a majority in aggregate principal amount of
the Debentures at the time Outstanding, determined in accordance with Section
11.4, 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; provided, however, that such direction shall
not be in conflict with any rule of law or with this Indenture. Subject to the
provisions of Section 10.1, the Trustee shall have the right to decline to
follow any such direction if the Trustee in good faith shall, by a Responsible
Officer or Officers of the Trustee, determine that the proceeding so directed
would involve the Trustee in personal liability. The holders of not less than a
majority in aggregate principal amount of the Debentures at the time Outstanding
affected thereby, determined in accordance with Section 11.4, may on behalf of
the holders of all of the Debentures waive any past default in the performance
of any of the covenants contained herein and its consequences, except (i) a
default in the payment of the principal of, or interest on, any of the
Debentures as and when the same shall become due by the terms of such Debentures
otherwise than by acceleration (unless such default has been cured and a sum
sufficient to pay all matured installments of interest and principal has been
deposited with the Trustee (in accordance with Section 8.1(c)); (ii) a default
in the covenants contained in Section 6.7; or (iii) in respect of
a covenant or provision hereof which cannot be modified or amended without the
consent of the holder of each Outstanding Debenture affected; provided, however,
that if the Debentures are held by the Trust or a trustee of the Trust, such
waiver or modification to such waiver shall not be effective until the holders
of a majority in liquidation preference of Trust Securities of the Trust shall
have consented to such waiver or modification to such waiver; provided further,
that if the consent of the holder of each Outstanding Debenture is required,
such waiver shall not be effective until each holder of the Trust Securities of
the Trust shall have consented to such waiver. Upon any such waiver, the default
covered thereby shall be deemed to be cured for all purposes of this Indenture
and the Company, the Trustee and the
42
holders of the Debentures shall be restored to their former positions and rights
hereunder, respectively; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
Section 8.7 Undertaking to Pay Costs.
All parties to this Indenture agree, and each holder of any Debentures
by such holder's acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for any
action taken or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 8.7 shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Debentureholder, or group of
Debentureholders holding more than 10% in aggregate principal amount of the
Outstanding Debentures, or to any suit instituted by any Debentureholder for the
enforcement of the payment of the principal of or interest on the Debentures, on
or after the respective due dates expressed in such Debenture or established
pursuant to this Indenture.
Section 8.8 Direct Action; Right of Set-Off
In the event that an Event of Default has occurred and is continuing and
such event is attributable to the failure of the Company to pay interest on or
principal of the Debentures on an Interest Payment Date or Maturity Date, as
applicable, then a holder of Preferred Securities may institute a legal
proceeding directly against the Company for enforcement of payment to such
holder of the principal of or interest on such Debentures having a principal
amount equal to the aggregate Liquidation Amount of the Preferred Securities of
such holders (a "Direct Action"). In connection with such Direct Action, the
Company will have a right of set-off under this Indenture to the extent of any
payment actually made by the Company to such holder of the Preferred Securities
with respect to such Direct Action.
ARTICLE IX
FORM OF DEBENTURE AND ORIGINAL ISSUE
Section 9.1 Form of Debenture.
The Debenture and the Trustee's Certificate of Authentication to be
endorsed thereon are to be substantially in the forms contained as Exhibit A to
this Indenture, attached hereto and incorporated herein by reference.
43
Section 9.2 Original Issue of Debentures.
Debentures in the aggregate principal amount of $_____________ may, upon
execution of this Indenture, be executed by the Company and delivered to the
Trustee for authentication. The Trustee shall thereupon authenticate and deliver
said Debentures to or upon the written order of the Company, signed by its
President, or any Vice President and its Chief Financial Officer or the
Treasurer or an Assistant Treasurer, without any further action by the Company.
ARTICLE X
CONCERNING THE TRUSTEE
Section 10.1 Certain Duties and Responsibilities of the Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform with respect to the Debentures such duties and only such
duties as are specifically set forth in this Indenture, and no implied covenants
shall be read into this Indenture against the Trustee. In case an Event of
Default has occurred that has not been cured or waived, 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 or her own
affairs.
(b) 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:
(i) prior to the occurrence of an Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(1) the duties and obligations of the Trustee shall with
respect to the Debentures be determined solely by the express
provisions of this Indenture, and the Trustee shall not be
liable with respect to the Debentures except for the performance
of such duties and obligations as are specifically set forth in
this Indenture, and no implied covenants or obligations shall be
read into this Indenture against the Trustee; and
(2) in the absence of bad faith on the part of the
Trustee, the Trustee may with respect to the Debentures
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee and conforming
to the requirements of this Indenture; but in the case of any
such certificates or opinions that 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 on their face they conform to the requirements of
this Indenture;
44
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Responsible Officers of
the Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts;
(iii) 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 not less than a majority in principal amount
of the Debentures at the time Outstanding 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 Debentures; and
(iv) none of the provisions contained in this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or
in the exercise of any of its rights or powers, if there is reasonable
ground for believing that the repayment of such funds or liability is
not reasonably assured to it under the terms of this Indenture or
adequate indemnity against such risk is not reasonably assured to it.
Section 10.2 Notice of Defaults.
Within 90 days after actual knowledge by a Responsible Officer of the
Trustee of the occurrence of any Default hereunder with respect to the
Debentures, the Trustee shall transmit by mail to all holders of the Debentures,
as their names and addresses appear in the Debenture Register, notice of such
Default, unless such Default shall have been cured or waived; provided, however,
that, except in the case of any Default in the payment of the principal or
interest (including any Additional Interest) on any Debenture, the Trustee shall
be protected in withholding such notice if and so long as the board of
directors, the executive committee or a trust committee of the directors and/or
one or more Responsible Officers of the Trustee determines in good faith that
the withholding of such notice is in the interests of the holders of such
Debentures; and provided, further, that in the case of any Default of the
character specified in Section 8.1(a)(3), no such notice to holders of
Debentures need be sent until at least 30 days after the occurrence thereof.
Section 10.3 Certain Rights of Trustee.
Except as otherwise provided in Section 10.1:
(a) The Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond, security or other paper
or document believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) Any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by a Board Resolution or an instrument
signed in the name of the Company by its President or any Vice President and by
the Secretary or an Assistant Secretary or
45
the Treasurer or an Assistant Treasurer thereof (unless other evidence in
respect thereof is specifically prescribed herein);
(c) The Trustee shall not be deemed to have knowledge of a Default or an
Event of Default, other than an Event of Default specified in Section 8.1(a)(i)
(other than the payment or nonpayment of Deferred Interest); or (ii), unless and
until it receives written notification of such Event of Default from the Company
or by holders of not less than 25% of the aggregate principal amount of the
Debentures at the time Outstanding;
(d) The Trustee may consult with counsel and the advice of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted hereunder in
good faith and in reliance thereon;
(e) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Debentureholders, pursuant to the provisions of this
Indenture, unless such Debentureholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that may be incurred therein or thereby; nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the occurrence of an Event
of Default (that has not been cured or waived) to exercise with respect to the
Debentures such of the rights and powers vested in it by this Indenture, and to
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 or her own
affairs;
(f) The Trustee shall not be liable for any action taken or omitted to
be taken by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Indenture;
(g) 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, consent, order, approval, bond, security, or
other papers or documents, unless requested in writing so to do by the holders
of not less than a majority in principal amount of the Outstanding Debentures
(determined as provided in Section 11.4); provided, however, that if the payment
within a reasonable time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is, in the
opinion of the Trustee, not reasonably assured to the Trustee by the security
afforded to it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such costs, expenses or liabilities as a condition
to so proceeding. The reasonable expense of every such examination shall be paid
by the Company or, if paid by the Trustee, shall be repaid by the Company upon
demand; and
(h) 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 appointed with due care by it
hereunder.
46
Section 10.4 Trustee Not Responsible for Recitals, etc.
(a) The Recitals contained herein and in the Debentures shall be taken
as the statements of the Company, and the Trustee assumes no responsibility for
the correctness of the same.
(b) The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Debentures.
(c) The Trustee shall not be accountable for the use or application by
the Company of any of the Debentures or of the proceeds of such Debentures, or
for the use or application of any moneys paid over by the Trustee in accordance
with any provision of this Indenture, or for the use or application of any
moneys received by any paying agent other than the Trustee.
Section 10.5 May Hold Debentures.
The Trustee or any paying agent or registrar for the Debentures, in its
individual or any other capacity, may become the owner or pledgee of Debentures
with the same rights it would have if it were not Trustee, paying agent or
Debenture Registrar.
Section 10.6 Moneys Held in Trust.
Subject to the provisions of Section 14.5, all moneys received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for interest on any moneys received by it hereunder except such as it
may agree in writing with the Company to pay thereon.
Section 10.7 Compensation and Reimbursement.
(a) The Company hereby covenants and agrees to pay to the Trustee, and
the Trustee shall be entitled to, such reasonable compensation (which shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust), as the Company and the Trustee may from time to time agree in
writing, for all services rendered by it in the execution of the trusts hereby
created and in the exercise and performance of any of the powers and duties
hereunder of the Trustee, and, except as otherwise expressly provided herein,
the Company shall pay or reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all Persons not regularly in its employ) except to the extent any such expense,
disbursement or advance arises from the Trustee's own negligence or bad faith.
The Company hereby covenants and agrees to indemnify each of the Bank and the
Trustee (and its officers, agents, directors and employees) (each, a "Fiduciary
Indemnified Person")for, and to hold each Fiduciary Indemnified Person harmless
against, any loss, liability or expense incurred by such Fiduciary Indemnified
Person and arising out of or in connection with the acceptance or administration
of this Indenture, including the costs and expenses of defending itself against
any
47
claim or liability in connection with the exercise or performance of any of its
rights, powers or duties hereunder, except to the extent such amount is
attributable to such Fiduciary Indemnified Person's own negligence or bad faith.
(b) The Company covenants and agrees to advance expenses (including
legal fees) incurred by a Fiduciary Indemnified Person in defending any claim,
demand, action, suit or proceeding, from time to time, prior to the final
disposition of such claim, demand, action, or suit or proceeding, upon receipt
by the Company of an undertaking by or on behalf of such Fiduciary Indemnified
Person to repay such amount if it shall be determined that such Fiduciary
Indemnified Person is not entitled to be indemnified as authorized in this
subsection.
(c) The obligations of the Company under this Section 10.7 shall
constitute additional indebtedness hereunder. Such additional indebtedness shall
be secured by a lien prior to that of the Debentures upon all property and funds
held or collected by the Trustee as such, except funds held in trust for the
benefit of the holders of particular Debentures.
The provisions of this Section 10.7 shall survive the termination of
this Indenture and shall survive the resignation or removal of the Trustee.
Section 10.8 Reliance on Officers' Certificate.
Except as otherwise provided in Section 10.1, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
suffering or omitting to take any action hereunder, such matter (unless other
evidence in respect thereof be herein specifically prescribed) may, in the
absence of negligence or bad faith on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers' Certificate delivered to the
Trustee and such certificate, in the absence of negligence or bad faith on the
part of the Trustee, shall be full warrant to the Trustee for any action taken,
suffered or omitted to be taken by it under the provisions of this Indenture
upon the faith thereof.
Section 10.9 Disqualification: Conflicting Interests.
If the Trustee has or shall acquire any "conflicting interest" within
the meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the
Company shall in all respects comply with the provisions of Section 310(b) of
the Trust Indenture Act.
Section 10.10 Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee with respect to the Debentures
issued hereunder which shall at all times be a Person organized and doing
business under the laws of the United States of America or any state or
territory thereof or of the District of Columbia, or a corporation or other
Person permitted to act as trustee by the Commission, authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000, and subject to supervision or examination by federal, state,
territorial, or District of Columbia
48
authority. If such Person publishes reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section 10.10, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. The Company may
not, nor may any Person directly or indirectly controlling, controlled by, or
under common control with the Company, serve as Trustee. In case at any time the
Trustee shall cease to be eligible in accordance with the provisions of this
Section 10.10, the Trustee shall resign immediately in the manner and with the
effect specified in Section 10.11.
Section 10.11 Resignation and Removal; Appointment of Successor.
(a) The Trustee or any successor hereafter appointed, may at any time
resign by giving written notice thereof to the Company and by transmitting
notice of resignation by mail, first class postage prepaid, to the
Debentureholders, as their names and addresses appear upon the Debenture
Register. Upon receiving such notice of resignation, the Company shall promptly
appoint a successor trustee with respect to Debentures by written instrument, in
duplicate, executed by order of the Board of Directors, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the mailing 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
Debentures, or any Debentureholder who has been a bona fide holder of a
Debenture or Debentures for at least six months may, subject to the provisions
of Sections 10.9 and 10.10, on behalf of himself and all others similarly
situated, petition any such court for the appointment of a successor trustee.
Such court may thereupon after such notice, if any, as it may deem proper and
prescribe, appoint a successor trustee.
(b) In case at any time any one of the following shall occur:
(i) the Trustee shall fail to comply with the provisions of
Section 9.9 after written request therefor by the Company or by any
Debentureholder who has been a bona fide holder of a Debenture or
Debentures for at least six months; or
(ii) the Trustee shall cease to be eligible in accordance with
the provisions of Section 9.10 and shall fail to resign after written
request therefor by the Company or by any such Debentureholder; or
(iii) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or commence a voluntary bankruptcy
proceeding, or a receiver of the Trustee or of its property shall be
appointed or consented to, 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, the
Company may remove the Trustee with respect to all Debentures and
appoint a successor trustee by written instrument, in duplicate,
executed by order of the Board of Directors, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to
the successor trustee, or, subject to the provisions of Sections 10.9
and 10.10, unless the
49
Trustee's duty to resign is stayed as provided herein, any
Debentureholder who has been a bona fide holder of a Debenture or
Debentures for at least six months may, on behalf of that holder and all
others similarly situated, petition any court of competent jurisdiction
for the removal of the Trustee and the appointment of a successor
trustee. Such court may thereupon after such notice, if any, as it may
deem proper and prescribe, remove the Trustee and appoint a successor
trustee.
(c) The holders of not less than a majority in aggregate principal
amount of the Debentures at the time Outstanding may at any time remove the
Trustee by so notifying the Trustee and the Company and may appoint a successor
Trustee with the consent of the Company.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee with respect to the Debentures pursuant to any of the
provisions of this Section 10.11 shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 10.12.
(e) Any successor trustee appointed pursuant to this Section 10.11 may
be appointed with respect to the Debentures, and at any time there shall be only
one Trustee with respect to the Debentures.
Section 10.12 Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor trustee with
respect to the Debentures, every successor trustee so appointed shall execute,
acknowledge and deliver to the Company and to 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 of the retiring Trustee; but, on the request of the
Company or the successor trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
trustee all the rights, powers, and trusts of the retiring Trustee and shall
duly assign, transfer and deliver to such successor trustee all property and
money held by such retiring Trustee hereunder.
(b) Upon request of any 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) of this Section 10.12.
(c) No successor trustee shall accept its appointment unless at the time
of such acceptance such successor trustee shall be qualified and eligible under
this Article X.
(d) Upon acceptance of appointment by a successor trustee as provided in
this Section 10.12, the Company shall transmit notice of the succession of such
trustee hereunder by mail, first class postage prepaid, to the Debentureholders,
as their names and addresses appear upon the Debenture Register. If the Company
fails to transmit such notice within ten days after
50
acceptance of appointment by the successor trustee, the successor trustee shall
cause such notice to be transmitted at the expense of the Company.
Section 10.13 Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Trustee may be merged or converted or with
which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided that
such Person shall be qualified under the provisions of Section 10.9 and eligible
under the provisions of Section 9.10, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding. In case any Debentures 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 Debentures so authenticated with the same
effect as if such successor Trustee had itself authenticated such Debentures.
Section 10.14 Preferential Collection of Claims Against the Company.
The Trustee shall comply with Section 311(a) of the Trust Indenture Act,
excluding any creditor relationship described in Section 311(b) of the Trust
Indenture Act. A Trustee who has resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent included therein.
ARTICLE XI
CONCERNING THE DEBENTUREHOLDERS
Section 11.1 Evidence of Action by Holders.
(a) Whenever in this Indenture it is provided that the holders of not
less than a majority or specified percentage in aggregate principal amount of
the Debentures may take any action (including the making of any demand or
request, the giving of any notice, consent or waiver or the taking of any other
action), the fact that at the time of taking any such action the holders of such
majority or specified percentage have joined therein may be evidenced by any
instrument or any number of instruments of similar tenor executed by such
holders of Debentures in Person or by agent or proxy appointed in writing.
(b) If the Company shall solicit from the Debentureholders any request,
demand, authorization, direction, notice, consent, waiver or other action, the
Company may, at its option, as evidenced by an Officers' Certificate, fix in
advance a record date for the determination of Debentureholders entitled to give
such request, demand, authorization, direction, notice, consent, waiver or other
action, but the Company shall have no obligation to do so. If such a record date
is fixed, such request, demand, authorization, direction, notice, consent,
waiver or other action may be given before or after the record date, but only
the Debentureholders of record at the close
51
of business on the record date shall be deemed to be Debentureholders for the
purposes of determining whether Debentureholders of the requisite proportion of
Outstanding Debentures have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other action, and
for that purpose the Outstanding Debentures shall be computed as of the record
date; provided, however, that no such authorization, agreement or consent by
such Debentureholders on the 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.
Section 11.2 Proof of Execution by Debentureholders.
Subject to the provisions of Section 10.1, proof of the execution of any
instrument by a Debentureholder (such proof shall not require notarization) or
such Debentureholder's agent or proxy and proof of the holding by any Person of
any of the Debentures shall be sufficient if made in the following manner:
(a) The fact and date of the execution by any such Person of any
instrument may be proved in any reasonable manner acceptable to the Trustee.
(b) The ownership of Debentures shall be proved by the Debenture
Register of such Debentures or by a certificate of the Debenture Registrar
thereof.
(c) The Trustee may require such additional proof of any matter
referred to in this Section 11.2 as it shall deem necessary.
Section 11.3 Who May be Deemed Owners.
Prior to the due presentment for registration of transfer of any
Debenture, the Company, the Trustee, any paying agent, any Authenticating Agent
and any Debenture Registrar may deem and treat the Person in whose name such
Debenture shall be registered upon the books of the Company as the absolute
owner of such Debenture (whether or not such Debenture shall be overdue and
notwithstanding any notice of ownership or writing thereon made by anyone other
than the Debenture Registrar) for the purpose of receiving payment of or on
account of the principal of and interest on such Debenture (subject to Section
2.3) and for all other purposes; and neither the Company nor the Trustee nor any
paying agent nor any Authenticating Agent nor any Debenture Registrar shall be
affected by any notice to the contrary.
Section 11.4 Certain Debentures Owned by Company Disregarded.
In determining whether the holders of the requisite aggregate principal
amount of Debentures have concurred in any direction, consent or waiver under
this Indenture, the Debentures that are owned by the Company or any other
obligor on the Debentures or by any Person directly or indirectly controlling or
controlled by or under common control with the Company or any other obligor on
the Debentures shall be disregarded and deemed not to be Outstanding for the
purpose of any such determination, except (i) that for the purpose of
52
determining whether the Trustee shall be protected in relying on any such
direction, consent or waiver, only Debentures that a Responsible Officer of the
Trustee actually knows are so owned shall be so disregarded; and (ii) for
purposes of this Section 11.4, the Trust shall be deemed not to be controlled by
the Company. The Debentures so owned that have been pledged in good faith may be
regarded as Outstanding for the purposes of this Section 11.4, if the pledgee
shall establish to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Debentures and that the pledgee is not a Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company or any such other obligor. In case of a dispute as to
such right, any decision by the Trustee taken upon the advice of counsel shall
be full protection to the Trustee.
Section 11.5 Actions Binding on Future Debentureholders.
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 11.1, of the taking of any action by the holders of not less
than a majority or other percentage in aggregate principal amount of the
Debentures specified in this Indenture in connection with such action, any
holder of a Debenture that is shown by the evidence to be included in the
Debentures the holders of which have consented to such action may, by filing
written notice with the Trustee, and upon proof of holding as provided in
Section 11.2, revoke such action so far as concerns such Debenture. Except as
aforesaid any such action taken by the holder of any Debenture shall be
conclusive and binding upon such holder and upon all future holders and owners
of such Debenture, and of any Debenture issued in exchange therefor, on
registration of transfer thereof or in place thereof, irrespective of whether or
not any notation in regard thereto is made upon such Debenture. Any action taken
by the holders of not less than a majority or other percentage in aggregate
principal amount of the Debentures specified in this Indenture in connection
with such action shall be conclusively binding upon the Company, the Trustee and
the holders of all the Debentures.
ARTICLE XII
SUPPLEMENTAL INDENTURES
Section 12.1 Supplemental Indentures Without the Consent of Debentureholders.
In addition to any supplemental indenture otherwise authorized by this
Indenture, the Company and the Trustee may from time to time and at any time
enter into an indenture or indentures supplemental hereto (which shall conform
to the provisions of the Trust Indenture Act as then in effect), without the
consent of the Debentureholders, for one or more of the following purposes:
(a) to cure any ambiguity, defect, or inconsistency herein, or in
the Debentures;
(b) to comply with Article XI;
53
(c) to provide for uncertificated Debentures in addition to or in
place of certificated Debentures;
(d) to add to the covenants of the Company for the benefit of the
holders of all or any of the Debentures or to surrender any right or power
herein conferred upon the Company;
(e) to add to, delete from, or revise the conditions, limitations,
and restrictions on the authorized amount, terms, or purposes of issue,
authentication, and delivery of Debentures, only as herein set forth;
(f) to make any change that does not adversely affect the rights of
any Debentureholder in any material respect;
(g) to provide for the issuance of and establish the form and terms
and conditions of the Debentures, to establish the form of any certifications
required to be furnished pursuant to the terms of this Indenture or of the
Debentures, or to add to the rights of the holders of the Debentures;
(h) to qualify or maintain the qualification of this Indenture under
the Trust Indenture Act; or
(i) to evidence a consolidation or merger involving the Company as
permitted under Section 13.1.
The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into any such supplemental indenture
that affects the Trustee's own rights, duties or immunities under this Indenture
or otherwise (and no such supplemental indenture shall be binding on the Trustee
unless executed by the Trustee). Any supplemental indenture authorized by the
provisions of this Section 12.1 may be executed by the Company and the Trustee
without the consent of the holders of any of the Debentures at the time
Outstanding, notwithstanding any of the provisions of Section 12.2.
Section 12.2 Supplemental Indentures with Consent of Debentureholders.
With the consent (evidenced as provided in Section 11.1) of the holders
of not less than a majority in aggregate principal amount of the Debentures at
the time Outstanding, the Company, when authorized by Board Resolutions, and the
Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act as then in effect) for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this
Indenture or of any supplemental indenture or of modifying in any manner not
covered by Section 12.1 the rights of the holders of the Debentures under this
Indenture; provided, however, that no such supplemental indenture shall without
the consent of the holders of each Debenture then
54
Outstanding and affected thereby, (i) extend the fixed maturity of any
Debentures, reduce the principal amount thereof, reduce the rate or extend the
time of payment of interest thereon, or modify the provisions in Article IV with
respect to the conversion of Outstanding Debentures in a manner adverse to the
holders thereof, or without the consent of the holder of each Debenture so
affected; or (ii) reduce the aforesaid percentage of Debentures, the holders of
which are required to consent to any such supplemental indenture; provided
further, that if the Debentures are held by the Trust or a trustee of the Trust,
such supplemental indenture shall not be effective until the holders of not less
than a majority in liquidation preference of Trust Securities of the Trust shall
have consented to such supplemental indenture; provided further, that if the
consent of the holder of each Outstanding Debenture is required, such
supplemental indenture shall not be effective until each holder of the Trust
Securities of the Trust shall have consented to such supplemental indenture. It
shall not be necessary for the consent of the Debentureholders affected thereby
under this Section 12.2 to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such consent shall approve
the substance thereof.
Section 12.3 Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture pursuant to the
provisions of this Article XII, this Indenture shall be and be deemed to be
modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this Indenture
of the Trustee, the Company and the holders of Debentures shall thereafter be
determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
Section 12.4 Debentures Affected by Supplemental Indentures.
Debentures affected by a supplemental indenture, authenticated and
delivered after the execution of such supplemental indenture pursuant to the
provisions of this Article XII, may bear a notation in form approved by the
Company, provided such form meets the requirements of any exchange or automated
quotation system upon which the Debentures may be listed or quoted, as to any
matter provided for in such supplemental indenture. If the Company shall so
determine, new Debentures so modified as to conform, in the opinion of the Board
of Directors of the Company, to any modification of this Indenture contained in
any such supplemental indenture may be prepared by the Company, authenticated by
the Trustee and delivered in exchange for the Debentures then Outstanding.
Section 12.5 Execution of Supplemental Indentures.
(a) Upon the request of the Company, accompanied by its Board
Resolutions authorizing the execution of any such supplemental indenture, and
upon the filing with the Trustee of evidence of the consent of Debentureholders
required to consent thereto as aforesaid, the Trustee shall join with the
Company in the execution of such supplemental indenture unless such supplemental
indenture affects the Trustee's own rights, duties or immunities under this
55
Indenture or otherwise, in which case the Trustee may in its discretion, but
shall not be obligated to, enter into such supplemental indenture. The Trustee,
subject to the provisions of Sections 10.1, may receive an Opinion of Counsel as
conclusive evidence that any supplemental indenture executed pursuant to this
Article XII is authorized or permitted by, and conforms to, the terms of this
Article XII and that it is proper for the Trustee under the provisions of this
Article XII to join in the execution thereof.
(b) Promptly after the execution by the Company and the Trustee of
any supplemental indenture pursuant to the provisions of this Section 12.5, the
Trustee shall transmit by mail, first class postage prepaid, a notice, setting
forth in general terms the substance of such supplemental indenture, to the
Debentureholders as their names and addresses appear upon the Debenture
Register. Any failure of the Trustee to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
supplemental indenture.
ARTICLE XIII
SUCCESSOR CORPORATION
Section 13.1 Company May Consolidate, etc.
Nothing contained in this Indenture or in any of the Debentures shall
prevent any consolidation or merger of the Company with or into any other
corporation or corporations (whether or not affiliated with the Company, as the
case may be), or successive consolidations or mergers in which the Company, as
the case may be, or its successor or successors shall be a party or parties, or
shall prevent any sale, conveyance, transfer or other disposition of the
property of the Company, as the case may be, or its successor or successors as
an entirety, or substantially as an entirety, to any other corporation (whether
or not affiliated with the Company, as the case may be, or its successor or
successors) authorized to acquire and operate the same; provided, however, the
Company hereby covenants and agrees that, (i) upon any such consolidation,
merger, sale, conveyance, transfer or other disposition, the due and punctual
payment, in the case of the Company, of the principal of and interest on all of
the Debentures, according to their tenor and the due and punctual performance
and observance of all the covenants and conditions of this Indenture to be kept
or performed by the Company as the case may be, shall be expressly assumed, by
supplemental indenture (which shall conform to the provisions of the Trust
Indenture Act, as then in effect) satisfactory in form to the Trustee executed
and delivered to the Trustee by the entity formed by such consolidation, or into
which the Company, as the case may be, shall have been merged, or by the entity
which shall have acquired such property; (ii) in case the Company consolidates
with or merges into another Person or conveys or transfers its properties and
assets substantially as an entirety to any Person, the successor Person is
organized under the laws of the United States or any state or the District of
Columbia; and (iii) immediately after giving effect thereto, no Default or Event
of Default, shall have occurred and be continuing.
56
Section 13.2 Successor Corporation Substituted.
(a) In case of any such consolidation, merger, sale, conveyance,
transfer or other disposition and upon the assumption by the successor
corporation, by supplemental indenture, executed and delivered to the Trustee
and satisfactory in form to the Trustee, of, in the case of the Company, the due
and punctual payment of the principal of and interest on all of the Debentures
Outstanding and the due and punctual performance of all of the covenants and
conditions of this Indenture to be performed by the Company, as the case may be,
such successor corporation shall succeed to and be substituted for the Company,
with the same effect as if it had been named as the Company herein, and
thereupon the predecessor corporation shall be relieved of all obligations and
covenants under this Indenture and the Debentures.
(b) In case of any such consolidation, merger, sale, conveyance,
transfer or other disposition such changes in phraseology and form (but not in
substance) may be made in the Debentures thereafter to be issued as may be
appropriate.
(c) Nothing contained in this Indenture or in any of the Debentures
shall prevent the Company from merging into itself or acquiring by purchase or
otherwise all or any part of the property of any other Person (whether or not
affiliated with the Company).
Section 13.3 Evidence of Consolidation, etc. to Trustee.
The Trustee, subject to the provisions of Section 10.1, may receive an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale, conveyance, transfer or other disposition, and any such assumption, comply
with the provisions of this Article XIII.
ARTICLE XIV
SATISFACTION AND DISCHARGE
Section 14.1 Satisfaction and Discharge of Indenture.
If at any time: (a) the Company shall have delivered to the Trustee for
cancellation all Debentures theretofore authenticated (other than any Debentures
that shall have been destroyed, lost or stolen and that shall have been replaced
or paid as provided in Section 2.9) and all Debentures for whose payment money
or Governmental Obligations have theretofore been deposited in trust or
segregated and held in trust by the Company (and thereupon repaid to the Company
or discharged from such trust, as provided in Section 14.5); or (b) all such
Debentures not theretofore delivered to the Trustee for cancellation shall have
become due and payable, or are by their terms to become due and payable within
one year or are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption, and the
Company shall deposit or cause to be deposited with the Trustee as trust funds
the entire amount in moneys or Governmental Obligations sufficient or a
combination thereof, sufficient in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay at
57
maturity or upon redemption all Debentures not theretofore delivered to the
Trustee for cancellation, including principal and interest due or to become due
to such date of maturity or date fixed for redemption, as the case may be, and
if the Company shall also pay or cause to be paid all other sums payable
hereunder by the Company; then this Indenture shall thereupon cease to be of
further effect except for the provisions of Sections 2.3, 2.7, 2.9, 6.1, 6.2,
6.3, 10.7 and 10.10, that shall survive until the date of maturity or redemption
date, as the case may be, and Sections 10.7 and 14.5, that shall survive to such
date and thereafter, and the Trustee, on demand of the Company and at the cost
and expense of the Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture.
Section 14.2 Discharge of Obligations.
If at any time all Debentures not heretofore delivered to the Trustee
for cancellation or that have not become due and payable as described in Section
14.1 shall have been paid by the Company by depositing irrevocably with the
Trustee as trust funds moneys or an amount of Governmental Obligations
sufficient in the opinion of a nationally recognized certified public accounting
firm to pay at maturity or upon redemption all Debentures not theretofore
delivered to the Trustee for cancellation, including principal and interest due
or to become due to such date of maturity or date fixed for redemption, as the
case may be, and if the Company shall also pay or cause to be paid all other
sums payable hereunder by the Company, then after the date such moneys or
Governmental Obligations, as the case may be, are deposited with the Trustee,
the obligations of the Company under this Indenture shall cease to be of further
effect except for the provisions of Sections 2.3, 2.7, 2.9, 6.1, 6.2, 6.3, 10.6,
10.7 and 14.5 hereof that shall survive until such Debentures shall mature and
be paid. Thereafter, Sections 10.7 and 14.5 shall survive.
Section 14.3 Deposited Moneys to be Held in Trust.
All monies or Governmental Obligations deposited with the Trustee
pursuant to Sections 14.1 or 14.2 shall be held in trust and shall be available
for payment as due, either directly or through any paying agent (including the
Company acting as its own paying agent), to the holders of the Debentures for
the payment or redemption of which such moneys or Governmental Obligations have
been deposited with the Trustee.
Section 14.4 Payment of Monies Held by Paying Agents.
In connection with the satisfaction and discharge of this Indenture, all
moneys or Governmental Obligations then held by any paying agent under the
provisions of this Indenture shall, upon demand of the Company, be paid to the
Trustee and thereupon such paying agent shall be released from all further
liability with respect to such moneys or Governmental Obligations.
Section 14.5 Repayment to Company.
Any monies or Governmental Obligations deposited with any paying agent
or the Trustee, or then held by the Company in trust, for payment of principal
of or interest on the
58
Debentures that are not applied but remain unclaimed by the holders of such
Debentures for at least two years after the date upon which the principal of or
interest on such Debentures shall have respectively become due and payable,
shall be repaid to the Company, as the case may be, on June 30 of each year or
(if then held by the Company) shall be discharged from such trust; and thereupon
the paying agent and the Trustee shall be released from all further liability
with respect to such moneys or Governmental Obligations, and the holder of any
of the Debentures entitled to receive such payment shall thereafter, as an
unsecured general creditor, look only to the Company for the payment thereof.
ARTICLE XV
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
Section 15.1 No Recourse.
No recourse under or upon any obligation, covenant or agreement of this
Indenture, or of the Debentures, or for any claim based thereon or otherwise in
respect thereof, shall be had against any incorporator, stockholder, officer or
director, past, present or future as such, of the Company or of any predecessor
or successor corporation, either directly or through the Company or any such
predecessor or successor corporation, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise; it being expressly understood that this Indenture and the obligations
issued hereunder are solely corporate obligations, and that no such personal
liability whatever shall attach to, or is or shall be incurred by, the
incorporators, stockholders, officers or directors as such, of the Company or of
any predecessor or successor corporation, or any of them, because of the
creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or in any of
the Debentures or implied therefrom; and that any and all such personal
liability of every name and nature, either at common law or in equity or by
constitution or statute, of, and any and all such rights and claims against,
every such incorporator, stockholder, officer or director as such, because of
the creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or in any of
the Debentures or implied therefrom, are hereby expressly waived and released as
a condition of, and as a consideration for, the execution of this Indenture and
the issuance of such Debentures.
ARTICLE XVI
MISCELLANEOUS PROVISIONS
Section 16.1 Effect on Successors and Assigns.
All the covenants, stipulations, promises and agreements in this
Indenture contained by or on behalf of the Company shall bind its respective
successors and assigns, whether so expressed or not.
59
Section 16.2 Actions by Successor.
Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer of the
Company shall and may be done and performed with like force and effect by the
corresponding board, committee or officer of any corporation that shall at the
time be the lawful sole successor of the Company.
Section 16.3 Surrender of Company Powers.
The Company by instrument in writing executed by appropriate authority
of its Board of Directors and delivered to the Trustee may surrender any of the
powers reserved to the Company, and thereupon such power so surrendered shall
terminate both as to the Company, as the case may be, and as to any successor
corporation.
Section 16.4 Notices.
Except as otherwise expressly provided herein any notice or demand that
by any provision of this Indenture is required or permitted to be given or
served by the Trustee or by the holders of Debentures to or on the Company may
be given or served by being deposited first class postage prepaid in a
post-office letterbox addressed (until another address is filed in writing by
the Company with the Trustee), as follows: Greater Atlantic Financial Corp,
00000 Xxxxxxxxx Xxxxxxxxx, Xxxxxx, XX 00000, Attention: Chief Financial Officer.
Any notice, election, request or demand by the Company or any Debentureholder to
or upon the Trustee shall be deemed to have been sufficiently given or made, for
all purposes, if given or made in writing at the Corporate Trust Office of the
Trustee.
Section 16.5 Governing Law.
This Indenture and each Debenture shall be deemed to be a contract made
under the internal laws of the State of New York and for all purposes shall be
construed in accordance with the laws of said State.
Section 16.6 Treatment of Debentures as Debt.
It is intended that the Debentures shall be treated as indebtedness and
not as equity for federal income tax purposes. The provisions of this Indenture
shall be interpreted to further this intention.
Section 16.7 Compliance Certificates and Opinions.
(a) Upon any application or demand by the Company to the Trustee to
take any action under any of the provisions of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent provided for in this Indenture relating to the proposed action have
been complied with and an Opinion of Counsel stating that in the
60
opinion of such counsel all such conditions precedent have been complied with,
except that in the case of any such application or demand as to which the
furnishing of such documents is specifically required by any provision of this
Indenture relating to such particular application or demand, no additional
certificate or opinion need be furnished.
(b) Each certificate or opinion of the Company provided for in this
Indenture and delivered to the Trustee with respect to compliance with a
condition or covenant in this Indenture shall include (1) a statement that the
Person making such certificate or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based; (3) a statement that, in the opinion of such
Person, he has made such examination or investigation as, in the opinion of such
Person, is necessary to enable him to express an informed opinion as to whether
or not such covenant or condition has been complied with; and (4) a statement as
to whether or not, in the opinion of such Person, such condition or covenant has
been complied with; provided, however, that each such certificate shall comply
with the provisions of Section 314 of the Trust Indenture Act.
Section 16.8 Payments on Business Days.
In any case where the date of maturity of interest or principal of any
Debenture or the date of redemption of any Debenture shall not be a Business
Day, then payment of interest or principal may be made on the next succeeding
Business Day with the same force and effect as if made on the nominal date of
maturity or redemption, and no interest shall accrue for the period after such
nominal date.
Section 16.9 Conflict with Trust Indenture Act.
If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
Section 16.10 Counterparts.
This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one and the same instrument.
Section 16.11 Separability.
In case any one or more of the provisions contained in this Indenture or
in the Debentures shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Indenture or of the Debentures,
but this Indenture and the Debentures shall be construed as if such invalid or
illegal or unenforceable provision had never been contained herein or therein.
61
Section 16.12 Assignment.
The Company shall have the right at all times to assign any of its
respective rights or obligations under this Indenture to a direct or indirect
wholly owned Subsidiary of the Company, provided that, in the event of any such
assignment, the Company shall remain liable for all such obligations. Subject to
the foregoing, this Indenture is binding upon and inures to the benefit of the
parties thereto and their respective successors and assigns. This Indenture may
not otherwise be assigned by the parties thereto.
Section 16.13 Acknowledgment of Rights.
The Company acknowledges that, with respect to any Debentures held by
the Trust or a trustee of the Trust, if the Property Trustee fails to enforce
its rights under this Indenture as the holder of the Debentures held as the
assets of the Trust, any holder of Preferred Securities may institute legal
proceedings directly against the Company to enforce such Property Trustee's
rights under this Indenture without first instituting any legal proceedings
against such Property Trustee or any other person or entity. Notwithstanding the
foregoing, if an Event of Default has occurred and is continuing and such event
is attributable to the failure of the Company to pay interest or principal on
the Debentures on the date such interest or principal is otherwise payable (or
in the case of redemption, on the redemption date), the Company acknowledges
that a holder of Preferred Securities may directly institute a proceeding for
enforcement of payment to such holder of the principal of or interest on the
Debentures having a principal amount equal to the aggregate liquidation amount
of the Preferred Securities of such holder on or after the respective due date
specified in the Debentures.
ARTICLE XVII
SUBORDINATION OF DEBENTURES
Section 17.1 Agreement to Subordinate.
The Company covenants and agrees, and each holder of Debentures issued
hereunder by such holder's acceptance thereof likewise covenants and agrees,
that all Debentures shall be issued subject to the provisions of this Article
XVII; and each holder of a Debenture, whether upon original issue or upon
transfer or assignment thereof, accepts and agrees to be bound by such
provisions. The payment by the Company of the principal of and interest on all
Debentures issued hereunder shall, to the extent and in the manner hereinafter
set forth, be subordinated and junior in right of payment to the prior payment
in full of all Senior Debt, Subordinated Debt and Additional Senior Obligations
(collectively, "Senior Indebtedness") to the extent provided herein, whether
outstanding at the date of this Indenture or thereafter incurred. No provision
of this Article XVII shall prevent the occurrence of any default or Event of
Default hereunder.
62
Section 17.2 Default on Senior Debt, Subordinated Debt or Additional Senior
Obligations.
In the event and during the continuation of any default by the Company
in the payment of principal, premium, interest or any other payment due on any
Senior Indebtedness of the Company, or in the event that the maturity of any
Senior Indebtedness of the Company has been accelerated because of a default,
then, in either case, no payment shall be made by the Company with respect to
the principal (including redemption payments) of or interest on the Debentures.
In the event that, notwithstanding the foregoing, any payment shall be received
by the Trustee when such payment is prohibited by the preceding sentence of this
Section 17.2, such payment shall be held in trust for the benefit of, and shall
be paid over or delivered to, the holders of Senior Indebtedness or their
respective representatives, or to the trustee or trustees under any indenture
pursuant to which any of such Senior Indebtedness may have been issued, as their
respective interests may appear, but only to the extent that the holders of the
Senior Indebtedness (or their representative or representatives or a trustee)
notify the Trustee in writing within 90 days prior to the Trustee's receipt of
such payment of the amounts then due and owing on the Senior Indebtedness and
only the amounts specified in such notice to the Trustee shall be paid to the
holders of Senior Indebtedness.
Section 17.3 Liquidation; Dissolution; Bankruptcy.
(a) Upon any payment by the Company or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution or winding-up or liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due upon all Senior Indebtedness
of the Company shall first be paid in full, or payment thereof provided for in
money in accordance with its terms, before any payment is made by the Company on
account of the principal or interest on the Debentures; and upon any such
dissolution or winding-up or liquidation or reorganization, any payment by the
Company, or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to which the holders of the Debentures
or the Trustee would be entitled to receive from the Company, except for the
provisions of this Article XVII, shall be paid by the Company or by any
receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, or by the holders of the Debentures or by
the Trustee under this Indenture if received by them or it, directly to the
holders of Senior Indebtedness of the Company (pro rata to such holders on the
basis of the respective amounts of Senior Indebtedness held by such holders, as
calculated by the Company) or their representative or representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments
evidencing such Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay such Senior Indebtedness in
full, in money or money's worth, after giving effect to any concurrent payment
or distribution to or for the holders of such Senior Indebtedness, before any
payment or distribution is made to the holders of Debentures or to the Trustee.
(b) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be received by the
Trustee before all Senior Indebtedness of
63
the Company is paid in full, or provision is made for such payment in money in
accordance with its terms, such payment or distribution shall be held in trust
for the benefit of and shall be paid over or delivered to the holders of such
Senior Indebtedness or their representative or representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments
evidencing such Senior Indebtedness may have been issued, as their respective
interests may appear, as calculated by the Company, for application to the
payment of all Senior Indebtedness of the Company, as the case may be, remaining
unpaid to the extent necessary to pay such Senior Indebtedness in full in money
in accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the benefit of the holders of such Senior Indebtedness.
(c) For purposes of this Article XVII, the words "cash, property or
securities" shall not be deemed to include shares of stock 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 subordinated at least to the extent provided in this Article XVII with
respect to the Debentures to the payment of all Senior Indebtedness of the
Company, as the case may be, that may at the time be outstanding, provided that
(i) such Senior Indebtedness is assumed by the new corporation, if any,
resulting from any such reorganization or readjustment; and (ii) the rights of
the holders of such Senior Indebtedness are not, without the consent of such
holders, altered by such reorganization or readjustment. The consolidation of
the Company with, or the merger of the Company into, another corporation or the
liquidation or dissolution of the Company following the conveyance or transfer
of its property as an entirety, or substantially as an entirety, to another
corporation upon the terms and conditions provided for in Article XIII shall not
be deemed a dissolution, winding-up, liquidation or reorganization for the
purposes of this Section 17.3 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the conditions stated
in Article XIII. Nothing in Section 17.2 or in this Section 17.3 shall apply to
claims of, or payments to, the Trustee or any other Fiduciary Indemnified Person
under or pursuant to Section 10.7.
Section 17.4 Subrogation.
(a) Subject to the payment in full of all Senior Indebtedness of the
Company, the rights of the holders of the Debentures 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, as the case may
be, applicable to such Senior Indebtedness until the principal of and interest
on the Debentures shall be paid in full; and, for the purposes of such
subrogation, no payments or distributions to the holders of such Senior
Indebtedness of any cash, property or securities to which the holders of the
Debentures or the Trustee would be entitled except for the provisions of this
Article XVII, and no payment over pursuant to the provisions of this Article
XVII to or for the benefit of the holders of such Senior Indebtedness by holders
of the Debentures or the Trustee, shall, as between the Company, its creditors
other than holders of Senior Indebtedness of the Company, and the holders of the
Debentures, be deemed to be a payment by the Company to or on account of such
Senior Indebtedness. It is understood that the provisions of this Article XVII
are and are intended solely for the purposes of defining the relative rights of
the holders of the Debentures, on the one hand, and the holders of such Senior
Indebtedness on the other hand.
64
(b) Nothing contained in this Article XVII or elsewhere in this
Indenture or in the Debentures is intended to or shall impair, as between the
Company, its creditors (other than the holders of Senior Indebtedness of the
Company), and the holders of the Debentures, the obligation of the Company,
which is absolute and unconditional, to pay to the holders of the Debentures the
principal of and interest on the Debentures as and when the same shall become
due and payable in accordance with their terms, or is intended to or shall
affect the relative rights of the holders of the Debentures and creditors of the
Company, as the case may be, other than the holders of Senior Indebtedness of
the Company, as the case may be, nor shall anything herein or therein prevent
the Trustee or the holder of any Debenture from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, under this Article XVII of the holders of such Senior
Indebtedness in respect of cash, property or securities of the Company, as the
case may be, received upon the exercise of any such remedy.
(c) Upon any payment or distribution of assets of the Company referred
to in this Article XVII, the Trustee, subject to the provisions of Article X,
and the holders of the Debentures shall be entitled to conclusively rely upon
any order or decree made by any court of competent jurisdiction in which such
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver, trustee in bankruptcy, liquidation trustee,
agent or other Person making such payment or distribution, delivered to the
Trustee or to the holders of the Debentures, for the purposes of ascertaining
the Persons entitled to participate in such distribution, the holders of Senior
Indebtedness and other indebtedness of the Company, as the case may be, the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article XVII.
Section 17.5 Trustee to Effectuate Subordination.
Each holder of Debentures by such holder's acceptance thereof authorizes
and directs the Trustee on such holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article XVII and appoints the Trustee such holder's attorney-in-fact for any and
all such purposes.
Section 17.6 Notice by the Company.
(a) The Company shall give prompt written notice to a Responsible
Officer of the Trustee of any fact known to the Company that would prohibit the
making of any payment of monies to or by the Trustee in respect of the
Debentures pursuant to the provisions of this Article XVII. Notwithstanding the
provisions of this Article XVII or any other provision of this Indenture, the
Trustee shall not be charged with knowledge of the existence of any facts that
would prohibit the making of any payment of monies to or by the Trustee in
respect of the Debentures pursuant to the provisions of this Article XVII,
unless and until a Responsible Officer of the Trustee shall have received
written notice thereof from the Company or a holder or holders of Senior
Indebtedness or from any trustee therefor; and before the receipt of any such
written notice, the Trustee, subject to the provisions of Section 10.1, shall be
entitled in all respects to assume that no such facts exist; provided, however,
that if the Trustee shall not have received the notice provided for in this
Section 17.6 at least two Business Days prior to the date upon which by the
65
terms hereof any money may become payable for any purpose (including, without
limitation, the payment of the principal of or interest on any Debenture), then,
anything herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such money and to apply the same to the
purposes for which they were received, and shall not be affected by any notice
to the contrary that may be received by it within two Business Days prior to
such date.
(b) The Trustee, subject to the provisions of Section 10.1, shall be
entitled to conclusively rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Senior Indebtedness of the Company
(or a trustee on behalf of such holder) to establish that such notice has been
given by a holder of such Senior Indebtedness or a trustee on behalf of any such
holder or holders. In the event that the Trustee determines in good faith that
further evidence is required with respect to the right of any Person as a holder
of such Senior Indebtedness to participate in any payment or distribution
pursuant to this Article XVII, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of such
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article XVII, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
Section 17.7 Rights of the Trustee; Holders of Senior Indebtedness.
(a) The Bank in its individual capacity shall be entitled to all the
rights set forth in this Article XVII in respect of any Senior Indebtedness at
any time held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Bank of any of its
rights as such holder. The Trustee's or any other Fiduciary Indemnified Person's
right to compensation, reimbursement and advancement of expenses and
indemnification as set forth in Section 10.7 shall not be subject to the
subordination provisions of this Article XVII.
(b) With respect to the holders of Senior Indebtedness of the Company,
the Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article XVII, and no implied
covenants or obligations with respect to the holders of such Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of such Senior Indebtedness and,
subject to the provisions of Section 10.1, the Trustee shall not be liable to
any holder of such Senior Indebtedness if it shall pay over or deliver to
holders of Debentures, the Company or any other Person money or assets to which
any holder of such Senior Indebtedness shall be entitled by virtue of this
Article XVII or otherwise.
Section 17.8 Subordination may not be Impaired.
(a) No right of any present or future holder of any Senior Indebtedness
of the Company to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Company or by any act or failure to act, in
66
good faith, by any such holder, or by any noncompliance by the Company with the
terms, provisions and covenants of this Indenture, regardless of any knowledge
thereof that any such holder may have or otherwise be charged with.
(b) Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness of the Company may, at any time
and from time to time, without the consent of or notice to the Trustee or the
holders of the Debentures, without incurring responsibility to the holders of
the Debentures and without impairing or releasing the subordination provided in
this Article XVII or the obligations hereunder of the holders of the Debentures
to the holders of such Senior Indebtedness, do any one or more of the following:
(i) change the manner, place or terms of payment or extend the time of payment
of, or renew or alter, such Senior Indebtedness, or otherwise amend or
supplement in any manner such Senior Indebtedness or any instrument evidencing
the same or any agreement under which such Senior Indebtedness is outstanding;
(ii) sell, exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing such Senior Indebtedness; (iii) release any
Person liable in any manner for the collection of such Senior Indebtedness; and
(iv) exercise or refrain from exercising any rights against the Company and any
other Person.
67
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the day and year first above written.
GREATER ATLANTIC FINANCIAL CORP.
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
WILMINGTON TRUST COMPANY, AS
TRUSTEE
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
68
EXHIBIT A
(FORM OF FACE OF DEBENTURE)
GREATER ATLANTIC FINANCIAL CORP.
______% CONVERTIBLE JUNIOR SUBORDINATED DEBENTURE
[DUE DECEMBER 31, 2003]
No. ______________________ $___________
CUSIP No. ______________
Greater Atlantic Financial Corporation, a Delaware corporation (the
"Company," which term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to pay to,
_______________ or registered assigns, the principal sum of
_________________________ ($___________) on [DECEMBER 31, 2031] (the "Stated
Maturity"), and to pay interest on said principal sum from _________ __, 2001,
or from the most recent interest payment date (each such date, an "Interest
Payment Date") to which interest has been paid or duly provided for, quarterly
(subject to deferral as set forth herein) in arrears on the last day of March,
June, September and December of each year commencing [March 31, 2002], at the
rate of _____% per annum until the principal hereof shall have become due and
payable, and on any overdue principal and (without duplication and to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the same rate per annum compounded quarterly.
The amount of interest payable on any Interest Payment Date shall be computed on
the basis of a 360-day year consisting of twelve 30-day months. The amount of
interest for any partial period shall be computed on the basis of the number of
days elapsed in a 360-day year consisting of twelve 30-day months. In the event
that any date on which interest is payable on this Debenture is not a business
day, then payment of interest payable on such date shall be made on the next
succeeding day that is a business day (and without any interest or other payment
in respect of any such delay) except that, if such business day is in the next
succeeding calendar year, payment of such interest will be made on the
immediately preceding business day, in each case, with the same force and effect
as if made on such date. The interest installment so payable, and punctually
paid or duly provided for, on any Interest Payment Date shall, as provided in
the Indenture, be paid to the person in whose name this Debenture (or one or
more Predecessor Debentures, as defined in said Indenture) is registered at the
close of business on the regular record date for such interest installment,
which shall be the close of business on the business day next preceding such
Interest Payment Date unless otherwise provided in the Indenture. Any such
interest installment not punctually paid or duly provided for shall forthwith
cease to be payable to the registered holders on such regular record date and
may be paid to the Person in whose name this Debenture (or one or more
Predecessor Debentures) is registered at the close of business on a special
record date to be fixed by the Trustee for the payment of such defaulted
interest, notice thereof shall be fixed by the Trustee for the payment of such
defaulted interest, notice thereof shall be given to the registered holders of
the Debentures not less than 10 days prior to such special record date, or may
be paid
A-1
at any time in any other lawful manner not inconsistent with the requirements of
any securities exchange or quotation system on or in which the Debentures may be
listed or quoted, and upon such notice as may be required by such exchange, all
as more fully provided in the Indenture. The principal of and the interest on
this Debenture shall be payable at the office or agency of the Trustee
maintained for that purpose in any coin or currency of the United States of
America that at the time of payment is legal tender for payment of public and
private debts; provided, however, that payment of interest may be made at the
option of the Company by check mailed to the registered holder at such address
as shall appear in the Debenture Register. Notwithstanding the foregoing, so
long as the holder of this Debenture is the Property Trustee, the payment of the
principal of and interest on this Debenture shall be made at such place and to
such account as may be designated by the Trustee.
The Stated Maturity may be shortened at any time by the Company to any
date not earlier than [DECEMBER 31, 2005].
The indebtedness evidenced by this Debenture is, to the extent provided
in the Indenture, subordinate and junior in right of payment to the prior
payment in full of all Senior Indebtedness, and this Debenture is issued subject
to the provisions of the Indenture with respect thereto. Each holder of this
Debenture, by accepting the same, (a) agrees to and shall be bound by such
provisions; (b) authorizes and directs the Trustee on his or her behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided; and (c) appoints the Trustee his or her
attorney-in-fact for any and all such purposes. Each holder hereof, by his or
her acceptance hereof, hereby waives all notice of the acceptance of the
subordination provisions contained herein and in the Indenture by each holder of
Senior Indebtedness, whether now outstanding or hereafter incurred, and waives
reliance by each such holder upon said provisions.
This Debenture shall not be entitled to any benefit under the Indenture
hereinafter referred to, be valid or become obligatory for any purpose until the
Certificate of Authentication hereon shall have been signed by or on behalf of
the Trustee.
The provisions of this Debenture are continued on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.
All terms used in this Debenture that are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
A-2
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed.
Dated ___________________, 2001.
GREATER ATLANTIC FINANCIAL CORP.
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
Attest:
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
A-3
[FORM OF CERTIFICATE OF AUTHENTICATION]
CERTIFICATE OF AUTHENTICATION
This is one of the Debentures described in the within-mentioned
Indenture.
Dated: _____________, 2001
Wilmington Trust Company,
as Trustee not in its individual
capacity but solely
By
------------------------
Authorized Signatory
A-4
[FORM OF REVERSE OF DEBENTURE]
_______% CONVERTIBLE JUNIOR SUBORDINATED DEBENTURE [DUE 2031]
(CONTINUED)
This Debenture is one of the subordinated debentures of the Company
(herein sometimes referred to as the "Debentures"), all issued or to be issued
under and pursuant to an Indenture dated as of _________ __, 2001 (the
"Indenture") duly executed and delivered between the Company and Wilmington
Trust Company, as Trustee (the "Trustee"), to which Indenture reference is
hereby made for a description of the rights, limitations of rights, obligations,
duties and immunities thereunder of the Trustee, the Company and the holders of
the Debentures. The Debentures are limited in aggregate principal amount as
specified in the Indenture.
Because of the occurrence and continuation of a Special Event (as
defined in the Indenture), in certain circumstances, this Debenture may become
due and payable at the principal amount together with any interest accrued
thereon (the "Redemption Price"). The Redemption Price shall be paid prior to
12:00 noon, Eastern Standard Time, on the date of such redemption or at such
earlier time as the Company determines. The Company shall have the right as set
forth in the Indenture to redeem this Debenture at the option of the Company, as
set forth in the Indenture, in whole or in part (i) at any time on or after
[DECEMBER 31, 2003] at a Redemption Price equal to 100% of the principal amount
so redeemed plus any accrued but unpaid interest hereon to the date of
redemption ("Optional Redemption"); or (ii) at any time in certain circumstances
upon the occurrence of a Special Event, at a Redemption Price equal to 100% of
the principal amount hereof plus any accrued but unpaid interest hereon, to the
date of such redemption. Any redemption pursuant to this paragraph shall be made
upon not less than 30 days nor more than 60 days notice, at the Redemption
Price. The Redemption Price shall be paid at the time and in the manner provided
therefor in the Indenture. If the Debentures are only partially redeemed by the
Company pursuant to an Early Redemption or an Optional Redemption, the
Debentures shall be redeemed pro rata or by lot or by any other method utilized
by the Trustee as described in the Indenture.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures for the unredeemed portion hereof shall be issued in the
name of the holder hereof upon the cancellation hereof.
In case an Event of Default (as defined in the Indenture) shall have
occurred and be continuing, the principal of all of the Debentures may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than a majority in
aggregate principal amount of the Debentures at the time Outstanding (as defined
in the Indenture) to execute supplemental indentures for the purpose of adding
any provisions to or changing in any manner or eliminating
A-5
any of the provisions of the Indenture or of any supplemental indenture or of
modifying in any manner the rights of the holders of the Debentures; provided,
however, that no such supplemental indenture shall (i) extend the fixed maturity
of the Debentures except as provided in the Indenture, or reduce the principal
amount thereof, or reduce the rate or extend the time of payment of interest
thereon, without the consent of the holder of each Debenture so affected; or
(ii) reduce the aforesaid percentage of Debentures, the holders of which are
required to consent to any such supplemental indenture, without the consent of
the holders of each Debenture then Outstanding and affected thereby. The
Indenture also contains provisions permitting the holders of not less than a
majority in aggregate principal amount of the Debentures at the time
Outstanding, on behalf of all of the holders of the Debentures, to waive any
past default in the performance of any of the covenants contained in the
Indenture, or established pursuant to the Indenture, and its consequences,
except a default in the payment of the principal of or interest on any of the
Debentures. Any such consent or waiver by the registered holder of this
Debenture (unless revoked as provided in the Indenture) shall be conclusive and
binding upon such holder and upon all future holders and owners of this
Debenture and of any Debenture issued in exchange herefor or in place hereof
(whether by registration of transfer or otherwise), irrespective of whether or
not any notation of such consent or waiver is made upon this Debenture.
Any Debentureholder has the right, exercisable at any time after 60 days
after the date of the Indenture and on or before the close of business on the
Business Day immediately preceding the date of repayment of the Debentures,
whether at maturity or upon redemption (either at the option of the Company or
pursuant to a Special Event), to convert the principal amount thereof (or any
portion thereof that is an integral multiple of [$__]) into fully paid and
nonassessable shares of Common Stock of the Company at an initial conversion
ratio of _____ shares of Common Stock for each [$__] in aggregate principal
amount of Debentures (equal to an initial conversion price of $_____ per share
of Common Stock), subject to adjustment under certain circumstances (the
"Conversion Ratio"). The number of shares issuable upon conversion of a
principal amount of Debentures shall be determined by dividing such principal
amount by __ and multiplying the quotient so obtained by the Conversion Ratio in
effect on the Conversion Date. No fractional shares of Common Stock shall be
issued upon conversion and, in lieu thereof, a cash payment shall be made for
any fractional interest. The outstanding principal amount of any Debenture shall
be reduced by the portion of the principal amount thereof converted into shares
of Common Stock.
To convert a Debenture, a Debentureholder must (i) complete and sign a
Conversion Request substantially in the form attached hereto, (ii) surrender the
Debenture to the Conversion Agent, (iii) furnish appropriate endorsements or
transfer documents if required by the Debenture Registrar or Conversion Agent,
and (iv) pay any transfer or similar tax, if required. If a Conversion Request
is delivered on or after the regular record date and prior to the subsequent
Interest Payment Date, the Debentureholder shall be required to pay to the
Company the interest payment to be made on the subsequent Interest Payment Date,
and shall be entitled to receive the interest payable on the subsequent Interest
Payment Date, on the portion of Debentures to be converted notwithstanding the
conversion thereof prior to such Interest Payment Date. Notwithstanding the
foregoing, if, during an Extended Interest Payment Period, a notice of
A-6
redemption is mailed pursuant to Section 3.4 of the Indenture and a Debenture is
converted after such mailing but prior to the relevant redemption date, all
accrued but unpaid interest (including Additional Interest, if any) through the
date of conversion shall be paid to the Debentureholder of such Debenture on the
redemption date. Except as otherwise provided in the immediately preceding two
sentences, in the case of any Debenture which is converted, interest with a
Stated Maturity which is after the date of conversion of such Debenture shall
not be payable, and the Company shall not make or be required to make any other
payment, adjustment or allowance with respect to accrued but unpaid interest
(including Additional Interest, if any) on the Debentures being converted, which
shall be deemed to be paid in full. If any Debenture called for redemption is
converted, any money deposited with the Trustee or with any Paying Agent or so
segregated and held in trust for the redemption of such Debenture shall be paid
to the Company upon Company request or, if then held by the Company, shall be
discharged from such trust.
No reference herein to the Indenture and no provision of this Debenture
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal and interest on this
Debenture at the time and place and at the rate and in the manner herein
prescribed.
Provided certain conditions are met, the Company shall have the right at
any time during the term of the Debentures and from time to time to extend the
interest payment period of such Debentures for up to 20 consecutive quarters
(each, an "Extended Interest Payment Period"), at the end of which period the
Company shall pay all interest then accrued and unpaid (together with interest
thereon at the rate specified for the Debentures to the extent that payment of
such interest is enforceable under applicable law). Before the termination of
any such Extended Interest Payment Period, so long as no Event of Default shall
have occurred and be continuing, the Company may further extend such Extended
Interest Payment Period, provided that such Extended Interest Payment Period
together with all such further extensions thereof shall not exceed 00
xxxxxxxxxxx xxxxxxxx, xxxxxx beyond the Stated Maturity or end on a date other
than an Interest Payment Date. At the termination of any such Extended Interest
Payment Period and upon the payment of all accrued and unpaid interest and any
additional amounts then due and subject to the foregoing conditions, the Company
may commence a new Extended Interest Payment Period.
As provided in the Indenture and subject to certain limitations therein
set forth, this Debenture is transferable by the registered holder hereof on the
Debenture Register of the Company, upon surrender of this Debenture for
registration of transfer at the office or agency of the Trustee accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Company or the Trustee duly executed by the registered holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Debentures of
authorized denominations and for the same aggregate principal amount shall be
issued to the designated transferee or transferees. No service charge shall be
made for any such transfer, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in relation
thereto.
A-7
Prior to due presentment for registration of transfer of this Debenture,
the Company, the Trustee, any paying agent and the Debenture Registrar may deem
and treat the registered holder hereof as the absolute owner hereof (whether or
not this Debenture shall be overdue and notwithstanding any notice of ownership
or writing hereon made by anyone other than the Debenture Registrar) for the
purpose of receiving payment of or on account of the principal hereof and
interest due hereon and for all other purposes, and neither the Company nor the
Trustee nor any paying agent nor any Debenture Registrar shall be affected by
any notice to the contrary.
No recourse shall be had for the payment of the principal of or the
interest on this Debenture, or for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture, against any
incorporator, stockholder, officer or director, past, present or future, as
such, of the Company or of any predecessor or successor corporation, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released.
The Debentures are issuable only in registered form without coupons in
denominations of $__ and any integral multiple thereof.
A-8
FORM OF CONVERSION REQUEST
To: Wilmington Trust Company
The undersigned owner of Debentures hereby irrevocably elects to convert
these Debentures, or the portion below designated, into Common Stock of the
Company (the "Common Stock") in accordance with the terms of the Indenture (the
"Indenture"), dated as of __________, 2001, between Greater Atlantic Financial
Corp. and Wilmington Trust Company.
The undersigned owner of these Debentures hereby directs the Conversion
Agent to convert such Debentures on behalf of the undersigned, into Common Stock
(at the Conversion Ratio specified in the Indenture). The undersigned owner of
these Preferred Securities also hereby notifies the Conversion Agent that the
shares issuable and deliverable upon conversion, together with any check in
payment for fractional shares, should be issued in the name of and delivered to
the undersigned, unless a different name has been indicated in the assignment
below. (if shares are to be issued in the name of a person other than the
undersigned, the undersigned shall pay all transfer taxes payable with respect
thereto.)
Date:
---------------------
Principal Amount of Debentures to be converted ($__ or integral multiples
thereof):
$______________
If a name of names other than the undersigned, please indicate in the
spaces below the name or names in which the shares of Common Stock are to be
issued, along with the address or addresses of such person or persons:
---------------------------
---------------------------
---------------------------
(Sign exactly as your name appears on the other side of this Debenture) (for
conversion only)
Please print or type name and address, including zip code, and social security
or other identifying number:
---------------------------
---------------------------
---------------------------
Signature Guarantee:*
----------------------
----------------
A-9
*Signature must be guaranteed by an "eligible guarantor institution"
that is a bank, stockbroker, savings and loan association or credit union
meeting the requirements of the Registrar, which requirements include membership
or participation in the Securities Transfer Agents Medallion Program ("STAMP")
or such other "signature guarantee program" as may be determined by the
Registrar in addition to, or in substitution for, STAMP, all in accordance with
the Securities and Exchange Act of 1934, as amended.
A-10
