================================================================================
PRESIDENTIAL LIFE CORPORATION
Issuer
and
BANKERS TRUST COMPANY,
Trustee
--------------------
INDENTURE
Dated as of ., 1998
--------------------
.% Senior Notes due 2008
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Cross-Reference Table
TIA Indenture
Section Section
------- ---------
Section 310(a)(1)...................................................................... 609
(a)(2)............................................................................... 609
(a)(3)............................................................................... N.A.
(a)(4)............................................................................... N.A.
(b).................................................................................. 608
.................................................................................. 610
Section 311(a).......................................................................... 613
(b).................................................................................. 613
Section 312(a).......................................................................... 701
..................................................................................... 702(a)
(b).................................................................................. 702(b)
(c).................................................................................. 702(c)
Section 313(a).......................................................................... 703(a)
(b).................................................................................. 703(a)
(c).................................................................................. 703(a)
(d).................................................................................. 703(b)
Section 314(a).......................................................................... 704
(a)(4)............................................................................... 1004
..................................................................................... 1004
(b).................................................................................. N.A.
(c)(1)............................................................................... 102
(c)(2)............................................................................... 102
(c)(3)............................................................................... N.A.
(d).................................................................................. N.A.
(e).................................................................................. 102
Section 315(a).......................................................................... 601
(b).................................................................................. 602
(c).................................................................................. 601(b)
(d).................................................................................. 603(c)
(e).................................................................................. 514
Section 316(a).......................................................................... 101
(a)(1)(A)............................................................................ 502
..................................................................................... 512
(a)(1)(B)............................................................................ 513
(a)(2)............................................................................... N.A.
(b).................................................................................. 508
(c).................................................................................. 104(c)
Section 317(a)(1)....................................................................... 503
(a)(2)............................................................................... 504
(b).................................................................................. 1003
Section 318(a).......................................................................... 107
___________________________
N.A. means Not Applicable
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be
a part of the Indenture.
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TABLE OF CONTENTS
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Page
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ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION........ 1
SECTION 101. Definitions................................................... 1
SECTION 102. Compliance Certificates and Opinions.......................... 9
SECTION 103. Form of Documents Delivered to Trustee........................ 9
SECTION 104. Acts of Holders; Record Dates................................. 10
SECTION 105. Notices, Etc., to Trustee, Company and Guarantor.............. 11
SECTION 106. Notice to Holders; Waiver..................................... 11
SECTION 107. Trust Indenture Act Controls.................................. 12
SECTION 108. Effect of Headings and Table of Contents...................... 12
SECTION 109. Successors and Assigns........................................ 12
SECTION 110. Severability Clause........................................... 12
SECTION 111. Benefits of Indenture......................................... 12
SECTION 112. Governing Law................................................. 12
SECTION 113. Legal Holidays................................................ 12
ARTICLE TWO NOTE FORMS AND GUARANTEES...................................... 13
SECTION 201. Forms Generally............................................... 13
SECTION 202. Form of Face of Note.......................................... 13
SECTION 203. Form of Reverse of Note....................................... 15
SECTION 204. Exchange Schedule for Global Notes............................ 17
SECTION 205. Form of Assignment............................................ 17
SECTION 206. Form of Trustee's Certificate of Authentication............... 18
ARTICLE THREE THE NOTES.................................................... 18
SECTION 301. Title and Terms............................................... 18
SECTION 302. Denominations................................................. 20
SECTION 303. Execution, Authentication, Delivery and Dating................ 20
SECTION 304. Temporary Notes............................................... 21
SECTION 305. Registration, Registration of Transfer and Exchange........... 21
SECTION 306. Mutilated, Destroyed, Lost and Stolen Notes................... 23
SECTION 307. Payment of Interest; Interest Rights Preserved................ 24
SECTION 308. Persons Deemed Owners......................................... 25
SECTION 309. Cancellation.................................................. 25
SECTION 310. Computation of Interest....................................... 26
SECTION 311. CUSIP Numbers................................................. 26
ARTICLE FOUR SATISFACTION AND DISCHARGE.................................... 26
SECTION 401. Satisfaction and Discharge of Indenture....................... 26
SECTION 402. Application of Trust Money.................................... 28
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ARTICLE FIVE REMEDIES.................................................... 28
SECTION 501. Events of Default........................................... 28
SECTION 502. Acceleration of Maturity; Rescission and Annulment.......... 30
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.................................................... 31
SECTION 504. Trustee May File Proofs of Claim............................ 31
SECTION 505. Trustee May Enforce Claims Without Possession of Notes...... 32
SECTION 506. Application of Money Collected.............................. 32
SECTION 507. Limitation on Suits......................................... 33
SECTION 508. Unconditional Right of Holders to Receive Principal and
Interest................................................... 33
SECTION 509. Restoration of Rights and Remedies.......................... 33
SECTION 510. Rights and Remedies Cumulative.............................. 34
SECTION 511. Delay or Omission Not Waiver................................ 34
SECTION 512. Control by Holders.......................................... 34
SECTION 513. Waiver of Past Defaults..................................... 34
SECTION 514. Undertaking for Costs....................................... 35
SECTION 515. Waiver of Stay or Extension Laws............................ 35
ARTICLE SIX THE TRUSTEE.................................................. 35
SECTION 601. Certain Duties and Responsibilities......................... 35
SECTION 602. Notice of Defaults.......................................... 37
SECTION 603. Certain Rights of Trustee................................... 37
SECTION 604. Not Responsible for Recitals or Issuance of Notes........... 38
SECTION 605. May Hold Notes.............................................. 38
SECTION 606. Money Held in Trust......................................... 38
SECTION 607. Compensation and Reimbursement.............................. 38
SECTION 608. Disqualification; Conflicting Interests..................... 39
SECTION 609. Corporate Trustee Required; Eligibility..................... 39
SECTION 610. Resignation and Removal; Appointment of Successor........... 40
SECTION 611. Acceptance of Appointment by Successor...................... 41
SECTION 612. Merger, Conversion, Consolidation or Succession to Business. 41
SECTION 613. Preferential Collection of Claims Against Company or the
Guarantor.................................................. 42
SECTION 614. Appointment of Authenticating Agent......................... 42
ARTICLE SEVEN HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY.......... 43
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders... 43
SECTION 702. Preservation of Information; Communications to Holders...... 43
SECTION 703. Reports by Trustee.......................................... 44
SECTION 704. Reports by Company.......................................... 44
ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE....... 45
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms........ 45
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SECTION 802. Successor Substituted for the Company........................ 45
ARTICLE NINE SUPPLEMENTAL INDENTURES...................................... 46
SECTION 901. Supplemental Indentures Without Consent of Holders........... 46
SECTION 902. Supplemental Indentures With Consent of Holders.............. 46
SECTION 903. Execution of Supplemental Indentures......................... 47
SECTION 904. Effect of Supplemental Indentures............................ 47
SECTION 905. Conformity with Trust Indenture Act.......................... 47
SECTION 906. Reference in Notes to Supplemental Indentures................ 48
ARTICLE TEN COVENANTS..................................................... 48
SECTION 1001. Payment of Principal and Interest........................... 48
SECTION 1002. Maintenance of Office or Agency............................. 48
SECTION 1003. Money for Notes Payments to be Held in Trust................ 48
SECTION 1004. Statement by Officers as to Default......................... 49
SECTION 1005. Existence................................................... 50
SECTION 1006. Limitation on Liens......................................... 50
SECTION 1007. Limitation on Sale or Issuance of Stock of Subsidiaries..... 51
SECTION 1008. Limitation on Dividends and Other Payment Restrictions
Affecting Significant Subsidiaries......................... 51
SECTION 1009. Redemption of 9 1/2% Senior Notes Due 2000.................. 52
SECTION 1010. Waiver of Certain Covenants................................. 52
ARTICLE ELEVEN REDEMPTION OF NOTES........................................ 52
SECTION 1101. Applicability of Article.................................... 52
SECTION 1102. Optional Redemption......................................... 53
SECTION 1103. Election to Redeem; Notice to Trustee....................... 53
SECTION 1104. Selection by Trustee of Notes to be Redeemed................ 53
SECTION 1105. Notice of Redemption at the Option of the Company........... 53
SECTION 1106. Procedure and Notice for Redemption at the Option of
Each Holder................................................ 54
SECTION 1107. Deposit of Redemption Price................................. 56
SECTION 1108. Notes Payable on Date of Redemption......................... 56
SECTION 1109. Notes Redeemed in Part...................................... 56
ARTICLE TWELVE LEGAL DEFEASANCE AND COVENANT DEFEASANCE................... 57
SECTION 1201. Company's Option to Effect Defeasance or Covenant
Defeasance................................................. 57
SECTION 1202. Legal Defeasance and Discharge.............................. 57
SECTION 1203. Covenant Defeasance......................................... 57
SECTION 1204. Conditions to Legal Defeasance or Covenant Defeasance....... 58
SECTION 1205. Deposited Money and U.S. Government Obligations to be
Held in Trust; Other Miscellaneous Provisions.............. 59
SECTION 1206. Reinstatement............................................... 59
iii
INDENTURE, dated as of ., 1998 between Presidential Life Corporation,
a corporation duly organized and existing under the laws of the State of
Delaware, having its principal office at 00 Xxxxxxxx Xxxxxx, Xxxxx, Xxx Xxxx
00000, and its successors and assigns as Issuer (the "Company"), and Bankers
Trust Company, a New York banking corporation duly organized and existing under
the laws of New York, as Trustee (the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance, in one or more offerings, of up to $100
million aggregate principal amount of its .% Senior Notes due ., 2008 (the
"Notes") of substantially the tenor and amount hereinafter set forth.
This Indenture is subject to the provisions of the Trust Indenture Act
of 1939, as amended, and shall to the extent applicable, be governed by such
provisions.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes
by Holders thereof, it is mutually agreed, for the equal and proportionate
benefit of all Holders of the Notes, as follows:
ARTICLE ONE
-----------
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
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SECTION 101. Definitions. For all purposes of this Indenture, except
-----------
as otherwise expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles," with
respect to any computation required or permitted
hereunder, shall mean such accounting principles in the United States
as are generally accepted at the date of this instrument; and
(4) the words "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.
"Acquired Indebtedness" means Indebtedness of any Person (i) existing
at the time such Person becomes a Subsidiary or (ii) assumed in connection with
the acquisition of assets from a Person.
"Act," when used with respect to any Holder, has the meaning specified
in Section 104.
"Adjusted Treasury Rate" means, with respect to any date of
redemption, the rate per annum equal to the semiannual equivalent yield to
maturity of the Comparable Treasury Issue, calculated using a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount)
equal to the Comparable Treasury Price for such date of redemption, calculated
on the third Business Day preceding the date of redemption, plus in each case .%
(. basis points).
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under the direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of Voting Stock, by contract or otherwise; and the
terms "controlling" and "controlled" have the meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate Notes.
"Board of Directors" means the board of directors of the Company or
any duly authorized committee of that board.
"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, and delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday, which is not a day on which banking institutions in New York City are
authorized or obligated by law or executive order to close.
"Capital Stock," as applied to the stock of any corporation, means the
capital stock of every class whether now or hereafter authorized, regardless of
whether such capital stock shall be limited to a fixed sum or percentage with
respect to the rights of the holders
2
thereof to participate in dividends and in the distribution of assets upon the
voluntary or involuntary liquidation, dissolution or winding up of such
corporation.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or, if at any time
after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter,
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by the Chairman of the Board, the Vice
Chairman of the Board, the President or a Vice President, and by the Chief
Financial Officer, the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary, of the Company, and delivered to the Trustee as provided in
Section 105.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Quotation Agent as having a maturity comparable to the remaining
term of the Notes to be redeemed that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the remaining term
of such Notes.
"Comparable Treasury Price" means, with respect to any date of
redemption, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day preceding such date of redemption, as set forth in the
daily statistical release (or any successor release) published by the Federal
Reserve Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities," or (ii) if such release (or any successor release) is
not published or does not contain such prices on such Business Day, the average
of the Reference Treasury Dealer Quotations for such date, after excluding the
highest and lowest of such Reference Treasury Dealer Quotations, or (iii) if the
Trustee obtains fewer than three such Reference Treasury Dealer Quotations, the
average of all such Reference Treasury Dealer Quotations.
"Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of execution of this Indenture is located at Four
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust and Agency
Services, Facsimile number: (000) 000-0000.
"Default" means any event or condition which is, or after notice or
passage of time or both would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section 307.
3
"Depositary" means DTC until a successor depositary shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Depositary" shall mean such successor Depositary.
"DTC" means The Depository Trust Company, a New York corporation.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Event of Default" has the meaning specified in Section 501.
"Fair Market Value" means, with respect to any asset or property, the
sale value that would be obtained in an arm's length transaction between an
informed and willing seller under no compulsion to sell to an informed and
willing buyer.
"Federal Bankruptcy Code" means Title 11 of the United States Code, as
amended.
"Global Note" means a Note or Notes, as the case may be, in the form
prescribed in Article Two, issued to the Depositary or its nominee, and
deposited with, and registered in the name of, such Depositary or nominee.
"Holder" means a Person in whose name a Note is registered in the
Register.
"Indebtedness" means, with respect to any Person, (i) every obligation
of such Person for money borrowed or under any reimbursement obligation relating
to a letter of credit (other than letters of credit obtained in the ordinary
course of business), if, and to the extent that, any of the foregoing would
appear as a liability upon a balance sheet of such Person prepared in accordance
with generally accepted accounting principles, (ii) every obligation of such
Person evidenced by a bond, note, debenture or similar instrument, if, and to
the extent that, any of the foregoing would appear as a liability upon a balance
sheet of such Person prepared in accordance with generally accepted accounting
principles, (iii) every obligation of such Person in respect of lease rentals
which, under generally accepted accounting principles, would be shown on the
balance sheet of such Person as a liability (other than a current liability or a
deferred item), (iv) all obligations under interest rate contracts of such
Person, and (v) every guarantee, direct or indirect, of any obligation described
in clauses (i) through (iv) above.
"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 pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of, and govern, this instrument and any such supplemental indenture,
respectively.
"Interest Payment Date," when used with respect to any Note, means the
Stated Maturity of an installment of interest on such Note.
4
"Lien" means any mortgage, charge, pledge, lien, security interest or
encumbrance of any kind in respect of any property or asset, whether or not
filed, recorded or otherwise perfected under applicable law (including any
conditional sale or other title retention agreement and any lease in the nature
thereof).
"Make-Whole Amount" means, in connection with an optional redemption
of any Note, the excess, if any, of (i) the sum, as determined by the Quotation
Agent, of the present values of the principal amount of such Note, together with
scheduled payments of interest that would accrue thereon from the date of
redemption to the Stated Maturity of the Notes, in each case discounted to the
date of redemption on a semiannual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Adjusted Treasury Rate over (ii) 100% of the
principal amount of the Note to be redeemed.
"Maturity," when used with respect to any Note, means the date on
which the principal of such Note becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration of acceleration, call
for redemption, Sale of a Significant Subsidiary or otherwise.
"Notes" has the meaning stated in the first recital of this Indenture.
"Notice of Default" has the meaning assigned to it in Section
501(a)(3).
"Officers' Certificate" means a certificate signed on behalf of the
Company by the Chairman of the Board, a Vice Chairman of the Board, the
President or a Vice President, and by the Chief Financial Officer, the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary, of
the Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company and who shall be reasonably acceptable to the Trustee,
and delivered to the Trustee.
"Outstanding," when used with respect to Notes, means, as of the date
of determination, all Notes theretofore authenticated and delivered under this
Indenture, except:
(i) Notes theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Notes for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its
own Paying Agent) for the Holders of such Notes; provided that if such
Notes are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture or provision therefor satisfactory to
the Trustee has been made;
5
(iii) Notes which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Notes have been authenticated
and delivered pursuant to this Indenture, other than any such Notes in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Notes are held by a protected purchaser,
within the meaning of Article 8 of the New York Uniform Commercial
Code, in whose hands such Notes are valid obligations of the Company;
and
(iv) Notes with respect to which the Company has effected legal
defeasance and/or covenant defeasance as provided in Article Twelve;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Notes have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Notes owned by
the Company upon the Notes or any Affiliate of the Company shall be disregarded
and deemed not to be Outstanding, except that, in determining whether the
Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes which the
Trustee knows to be so owned shall be so disregarded. Notes so owned, which
have been pledged in good faith, may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Notes and that the pledgee is not the Company or any
Affiliate of the Company.
"Paying Agent" means any Person authorized by the Company to pay the
principal of, premium, if any, and interest on, any Notes on behalf of the
Company.
"Person" means any individual, corporation, limited partnership,
limited liability corporation, joint venture, association, joint stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment" means the place or places where the principal of,
premium, if any, and interest on, the Notes are payable as specified by Section
301.
"Predecessor Note" of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Note shall be deemed to evidence the same
debt as the mutilated, destroyed, lost or stolen Note.
"Quotation Agent" means one of the Reference Treasury Dealers
appointed by the Company as the Quotation Agent.
"Redemption Price," when used with respect to any Note to be redeemed,
means the price at which it is to be redeemed as specified therein.
6
"Reference Treasury Dealer" means (i) any of BT Alex. Xxxxx
Incorporated and Xxxxxxx Xxxxx Barney and their respective successors; provided,
however, that if either of the foregoing shall cease to be a primary U.S.
Government securities dealer in New York City (a "Primary Treasury Dealer"), the
Company shall substitute another Primary Treasury Dealer; and (ii) any other
Primary Treasury Dealer selected by the Company.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any date of redemption, the average, as determined
by the Company, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee and the Quotation Agent by such Reference Treasury Dealer
at 5:00 p.m., New York City time, on the third Business Day preceding such date
of redemption.
"Register" and "Registrar" have the respective meanings specified in
Section 305.
"Regular Record Date" for the interest payable with respect to any
Note on any Interest Payment Date means the . or . (whether or not a Business
Day) immediately preceding the relevant Interest Payment Date.
"Responsible Officer," when used with respect to the Trustee, means
any managing director, principal, vice president, assistant vice president,
assistant secretary, assistant treasurer, trust officer or any other officer of
the Trustee at its Corporate Trust Office customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his knowledge of and familiarity with
the particular subject.
"Sale of a Significant Subsidiary" means the sale, transfer,
assignment or other disposition of a Significant Subsidiary to any Person who is
not a wholly-owned Subsidiary of the Company.
"Significant Subsidiary" means, (i) as long as it is a Subsidiary,
Presidential Life Insurance Company, and (ii) any Subsidiary that would be a
"Significant Subsidiary" within the meaning of Rule 1-02(w)(2) under Regulation
S-X promulgated by the Commission; provided, however, that for purposes of the
definition of Sale of a Significant Subsidiary, the term "10 percent" in such
rule shall be substituted by the term "40 percent."
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity," when used with respect to any Indebtedness or any
installment of interest thereon, means the date specified in such Indebtedness
as the fixed date on which the principal of such Indebtedness or such
installment of interest is due and payable.
"Subordinated Indebtedness" means Indebtedness the payment of which is
subordinated in right of payment to the Notes.
7
"Subsidiary" means a corporation of which more than 50% of the
outstanding Voting Stock entitled (without regard to the occurrence of any
contingency) to vote generally in the election of directors thereof is owned,
directly or indirectly, by the Company or by one or more other Subsidiaries, or
by the Company and one or more other Subsidiaries.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean the Person who is then a Trustee hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended, and in force at the date as of which this instrument was executed,
except as provided in Section 905.
"U.S. Government Obligations" means securities that are (i) direct
obligations of the United States of America for the timely 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 timely payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer thereof.
"Vice President," when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president."
"Voting Stock" means the stock of the class or classes pursuant to
which the holders thereof have the general voting power under ordinary
circumstances to elect at least a majority of the board of directors, managers
or trustees of a corporation (irrespective of whether or not at the time stock
of any other class or classes shall have or might have voting power by reason of
the happening of any contingency).
For purposes of Section 311(b)(4) and (6) of the Trust Indenture Act,
the following terms shall have the meanings assigned to them:
"Cash transaction" means any transaction in which full payment for
goods or securities sold is made within seven days after delivery of the goods
or securities in currency or in checks or other orders drawn upon banks or
bankers and payable upon demand; and
"Self-liquidating paper" means any draft, xxxx of exchange, acceptance
or obligation which is made, drawn, negotiated or incurred by the Company for
the purpose of financing the purchase, processing, manufacturing, shipment,
storage or sale of goods, wares or merchandise and which is secured by documents
evidencing title to, possession of, or a lien upon, the goods, wares or
merchandise or the receivable or proceeds arising from the sale of the goods,
wares or merchandise previously constituting the security; provided that the
security is received by the Trustee simultaneously with the creation of the
creditor relationship with the Company arising from the making, drawing,
negotiating or incurring of the draft, xxxx of exchange, acceptance or
obligation.
8
SECTION 102. Compliance Certificates and Opinions. Upon any
------------------------------------
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with and an Opinion of Counsel stating that
in the opinion of such counsel all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Indenture relating to such particular application or request, no
additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(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 each such individual, he
has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with;
provided, however, that, with respect to matters of fact, an Opinion
of Counsel may rely on an Officers' Certificate or a certificate of
public officials.
SECTION 103. Form of Documents Delivered to Trustee. In any case
--------------------------------------
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous.
9
Where any Person or Persons is or are required to make, give or
execute two or more applications, requests, consents, certificates, statements,
opinions or other instruments under this Indenture, they may, but need not, be
consolidated and form one instrument.
SECTION 104. Acts of Holders; Record Dates. (a) Any request,
-----------------------------
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Holders may be embodied in
and evidenced by one or more instruments of substantially similar tenor signed
by such Holders in person or by agent duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee and, where it is
hereby expressly required, to the Company. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred
to as the "Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument, or of a writing appointing any such agent,
shall be sufficient for any purpose of this Indenture and (subject to Section
601) conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
Without limiting the generality of the foregoing, a Holder, including
a Depositary that is a Holder of a Global Note, may make, give or take, by a
proxy or proxies duly appointed in writing, any request, demand, authorization,
direction, notice, consent, waiver or other action provided in this Indenture to
be made, given or taken by Holders, and a Depositary that is a Holder of a
Global Note may provide its proxy or proxies to the beneficial owners of
interests in any such Global Note.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other reasonable manner which the Trustee deems sufficient.
(c) The Company may, at its option, by Board Resolution, set a record
date for determining the Holders entitled to give or take any request, demand,
authorization, direction, notice, consent, waiver or other Act, or to vote on
any action, authorized or permitted to be given or taken by Holders, but the
Company shall have no obligation to do so. If a record date is set pursuant to
this paragraph, such Act may be given or taken before or after the record date,
by only the Holders of record at the close of business on such record date who
shall be deemed to be Holders for the purpose of determining whether Holders of
the requisite proportion of Outstanding Notes have authorized or agreed or
consented to such Act, and for that purpose the Outstanding Notes shall be
computed as of the record date. If a record date is set pursuant to this
paragraph, the Company may, at its option, set an expiration date after which no
such Act purported to be given or taken by any Holder shall be effective
hereunder unless given or taken
10
on or prior to such expiration date by Holders of the requisite Outstanding
Notes on such record date, but the Company shall have no obligation to do so.
On or prior to any expiration date set pursuant to this paragraph, the
Company may, on one or more occasions at its option, extend such date to any
later date.
(d) The ownership of Notes shall be proved by the Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Note shall bind every future Holder of
the same Note and the Holder of every Note issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such Note.
SECTION 105. Notices, Etc., to Trustee and Company. Any request,
-------------------------------------
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing, in person, telecopied (with prompt confirmation by
first class mail postage prepaid) or mailed by registered mail, return
receipt requested, to or with the Trustee at its Corporate Trust
Office, Attention: Corporate Trust Department, or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing, in
person, telecopied (with prompt confirmation by first class mail
postage prepaid) or mailed by registered mail, return receipt
requested, to or with the Company, addressed to it at the address of
its principal office specified in the first paragraph of this
instrument, Attention: Chief Financial Officer (with a copy to the
same address, Attention: General Counsel) or at any other address
previously furnished in writing to the Trustee by the Company.
SECTION 106. Notice to Holders; Waiver. Where this Indenture
-------------------------
provides for notice to Holders of any event, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event, at his
address as it appears in the Register, not later than the latest date (if any),
and not earlier than the earliest date (if any), prescribed for the giving of
such notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall
11
be filed with the Trustee, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
SECTION 107. Trust Indenture Act Controls. If any provision hereof
----------------------------
limits, qualifies or conflicts with a provision of the Trust Indenture Act that
is required under such Act to be part of and govern this Indenture, the latter
provision shall control. If any provision of this Indenture modifies or
excludes any provision of the Trust Indenture Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Indenture as so
modified or to be excluded, as the case may be.
SECTION 108. Effect of Headings and Table of Contents. The Article
----------------------------------------
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
SECTION 109. Successors and Assigns. All covenants and agreements in
----------------------
this Indenture by the Company shall bind its successors and assigns, whether so
expressed or not.
SECTION 110. Severability Clause. In case any provision in this
-------------------
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 111. Benefits of Indenture. Nothing in this Indenture or the
---------------------
Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder and the Holders, any benefit or any legal
or equitable right, remedy or claim under this Indenture.
SECTION 112. Governing Law. This Indenture and the Notes shall be
-------------
governed by and construed in accordance with the law of the State of New York.
SECTION 113. Legal Holidays. In any case where any Interest Payment
--------------
Date or Maturity of any Note shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of the
Notes), payment of principal, premium, if any, or interest need not be made at
such Place of Payment on such date, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and effect as if made
on the Interest Payment Date or Maturity; provided that no interest shall accrue
on the amount so payable for the period from and after such Interest Payment
Date or Maturity, as the case may be.
12
ARTICLE TWO
-----------
NOTE FORMS
----------
SECTION 201. Forms Generally. The Notes and the Trustee's
---------------
certificates of authentication shall be in substantially the form set forth in
this Article, with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture, and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Notes, as evidenced by their execution of the Notes.
The Notes initially shall be issued in the form of one or more fully
registered Global Notes.
Any definitive Notes shall be printed, lithographed or engraved or may
be produced in any other manner, all as determined by the officers of the
Company executing such Notes, as evidenced by their execution of such Notes.
SECTION 202. Form of Face of Note.
--------------------
[Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]
[The following legend shall also appear on the face of each Global
Note:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
REFERRED TO BELOW AND IS REGISTERED IN THE NAME OF THE DEPOSITARY OR A NOMINEE
OF THE DEPOSITARY, WHICH MAY BE TREATED BY THE COMPANY, THE TRUSTEE AND ANY
AGENT THEREOF AS OWNER AND HOLDER OF THIS NOTE FOR ALL PURPOSES.]
[The following legend shall also appear on the face of each Global
Note for which The Depository Trust Company is to be the Depositary:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
13
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR REGISTERED
NOTES IN DEFINITIVE FORM IN THE CIRCUMSTANCES REFERENCED IN THE INDENTURE, THIS
GLOBAL NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]
PRESIDENTIAL LIFE CORPORATION
.% Senior Notes due ., 2008
No. _______
$____________ CUSIP No. ___________
Presidential Life Corporation, a corporation duly organized and
existing under the laws of the State of Delaware (herein called the "Company,"
which term includes any successor Person under the Indenture hereinafter
referred to), for value received, hereby promises to pay to
________________________________, or registered assigns, the principal sum of
__________________________________ Dollars on ____________________, and to pay
interest thereon from __________________ or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, semiannually
in arrears on . and . in each year, commencing _______________, 1998 at the rate
of .% per annum, until the principal hereof is paid or made available for
payment, and (to the extent that the payment of such interest shall be legally
enforceable) at the rate of .% per annum on any overdue principal and on any
overdue installment of interest. The interest so payable and punctually paid or
duly provided for on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Note (or one or more
Predecessor Notes) is registered at the close of business on the Regular Record
Date for such interest, which shall be the . or . (whether or not a Business
Day), as the case may be, immediately preceding such Interest Payment Date. Any
such interest not so punctually paid or duly provided for will forthwith cease
to be payable to the Holder on such Regular Record Date and may either be paid
to the Person in whose name this Note (or one or more Predecessor Notes) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Notes not less than 10 days prior to such Special Record
Date, or be paid at any time in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Notes may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in said Indenture.
Payments in respect of the principal of, premium, if any, and interest
on, this Note will be made at the office of the Trustee in The City of New York.
Payments in respect of principal or premium, if any, on this Note will be made
only against surrender of this Note at such office. Payment of interest on each
Interest Payment Date with respect to this Note will be made to the Person in
whose name this Note is registered at the close of business on the . or .
14
immediately preceding such Interest Payment Date by U.S. dollar check drawn on a
bank in the City of New York or, for Holders of at least $1,000,000 of Notes, by
wire transfer to a dollar account maintained by the payee with a bank in the
United States; provided that a written request from such Holder to such effect
designating such account is received by the Trustee or the Paying Agent no later
than 30 calendar days preceding such Interest Payment Date. Unless such
designation is revoked, any such designation made by such Holder with respect to
such Note payable to such Holder will remain in effect with respect to any
future payments with respect to such Note payable to such Holder. The Company
will pay any administrative costs imposed by banks in connection with making
payments by wire transfer.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed by manual or facsimile signature.
Dated:
PRESIDENTIAL LIFE CORPORATION
By: ___________________________________
Name:
Title:
SECTION 203. Form of Reverse of Note.
-----------------------
This Note is one of a duly authorized issue of securities of the
Company designated as its ".% Senior Notes due ., 2008" (herein called the
"Notes"), limited in aggregate principal amount to $100,000,000, issued in one
or more offerings under an Indenture, dated as of ., 1998 (herein called the
"Indenture"), between the Company, as issuer, and Bankers Trust Company, as
Trustee (herein called the "Trustee," which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered.
No sinking fund is provided for the Notes.
This Note will be redeemable, in whole or in part, at the option of
the Company, upon not less than 30 nor more than 60 days' notice, at a
Redemption Price equal to the sum of
15
(i) 100% of the principal amount hereof plus accrued and unpaid interest thereon
to, but excluding, the date of redemption, and (ii) a premium equal to the Make-
Whole Amount.
If there shall have occurred a Sale of a Significant Subsidiary, this
Note will be redeemable at the option of the Holder, in whole or in part (in
minimum denominations of $1,000 or integral multiples thereof), pursuant to the
procedures set forth in the Indenture, at a Redemption Price in cash equal to
100% of the principal amount hereof plus accrued and unpaid interest thereon to,
but excluding, the date of redemption.
In the event of redemption of this Note in part only, a new Note or
Notes for the unredeemed portion hereof will be issued in the name of the Holder
hereof upon the cancellation hereof.
The Indenture contains provisions for legal defeasance at any time of
the entire indebtedness of this Note or defeasance of certain restrictive
covenants with respect to this Note, in each case upon compliance by the Company
with certain conditions set forth therein.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes at any time by the Company
and the Trustee with the consent of the Holders of at least a majority in
principal amount of the Notes at the time Outstanding to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Notes at the time Outstanding, on behalf
of the Holders of all Notes, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note shall
be conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company which is
absolute and unconditional, to pay the principal of, premium, if any, and
interest on, this Note at the times, place and rate, and in the currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Note is registrable in the Register upon
surrender of this Note for registration of transfer at the office or agency
maintained by the Company for such purpose in the Borough of Manhattan, The City
of New York, which initially will be the office of the Trustee or at the office
of any Paying Agent, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Notes, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
16
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. A Holder may
transfer or exchange Notes in accordance with the Indenture.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Indenture and the Notes shall be governed by, and construed in
accordance with, the law of the State of New York.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
SECTION 204. Exchange Schedule for Global Notes. The following
----------------------------------
information shall appear on each Global Note:
The following exchanges of interests in this Global Note have been
made:
Principal amount
of this Note Signature of
following such authorized
Date of Amount of decrease Amount of increase decrease (or signatory of
exchange in this Note in this Note increase) Trustee
------------------------------------------------------------------------------------------------------
SECTION 205. Form of Assignment.
------------------
For value received ________________________ hereby sells(s), assign(s)
and transfer(s) unto _____________________ (Please insert social security or
other identifying number of assignee) the within Note, and hereby irrevocably
constitutes and appoints _________________________ as attorney to transfer the
said Note on the books of the Company.
Dated: --------------------------------
17
Signature(s)
Signature(s) must be guaranteed by an Eligible Guarantor Institution
with membership in an approved signature guarantee program pursuant to
Rule l7Ad-15 under the Exchange Act.
___________________________________
Signature Guaranteed
SECTION 206. Form of Trustee's Certificate of Authentication'.
-----------------------------------------------
Subject to Section 612, the Trustee's certificate of authentication shall be
substantially in the following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned
Indenture.
Bankers Trust Company
As Trustee
By:______________________________
Authorized Officer
ARTICLE THREE
-------------
THE NOTES
---------
SECTION 301. Title and Terms. (a) The aggregate principal amount of
---------------
Notes which may be authenticated and delivered in one or more offerings under
this Indenture is limited to an aggregate principal amount of $100,000,000,
except for Notes authenticated and delivered upon registration of transfer of,
or in exchange for, or in lieu of, other Notes pursuant to Sections 304, 305,
306, 906 and 1109. Any Notes issued subsequent to the initial offering of Notes
will have identical terms and conditions as the Notes then outstanding and will
vote on all matters together with such outstanding Notes. Notwithstanding the
above, or anything herein to the contrary, the issue price for any such
subsequent Notes may differ from the issue price of the Outstanding Notes; and
the first interest period for any such subsequent Notes will run from the date
of issuance of such subsequent Notes to, but excluding, the next Interest
Payment Date for the Notes.
(b) The Notes shall be known and designated as the ".% Senior Notes
due ., 2008" of the Company. Their Stated Maturity shall be ., 2008 and they
shall bear interest at the rate of .% per annum from the date of issuance of the
respective Notes or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, as the case may be, payable semiannually in
arrears on . and . of each year until the principal thereof is paid or made
available for payment; provided that any amount of such principal or interest
that is overdue shall bear interest at the rate of % per annum (to the extent
that payment of such
18
interest shall be legally enforceable), from the date such amount is due until
it is paid or made available for payment, and such interest on any overdue
amount shall be payable on demand.
(c) Payment in respect of the principal of, premium, if any, and
interest on, the Notes will be made at the office of the Trustee in The City of
New York or at any other Place of Payment designated by the Company pursuant to
Section 1002. Payments in respect of principal or premium, if any, on Notes
will be made only against surrender of such Notes at such office. Payments of
interest on each Interest Payment Date with respect to each Note will be made to
the Person in whose name such Note is registered at the close of business on the
. or . immediately preceding such Interest Payment Date by U.S. dollar check
drawn on a bank in the City of New York or, for Holders of at least $1,000,000
of Notes, by wire transfer to a dollar account maintained by the payee with a
bank in the United States; provided that a written request from such Holder to
such effect designating such account is received by the Trustee or the Paying
Agent no later than 30 calendar days preceding such Interest Payment Date.
Unless such designation is revoked, any such designation made by such Holder
with respect to such Note payable to such Holder will remain in effect with
respect to any future payments with respect to such Note payable to such Holder.
The Company will pay any administrative costs imposed by banks in connection
with making payments by wire transfer.
Payments due on Notes represented by a Global Note registered in the
name of the Depositary or its nominee will be made to the Depositary or its
nominee, as the case may be, as the registered owner of the Global Note
representing such Notes. The Company expects that the Depositary or its
nominee, upon receipt of any payment, will credit immediately participants'
accounts with payments in same-day funds in amounts proportionate to their
respective beneficial interests in such payments, as shown on the records of the
Depositary or its nominee. The Company also expects that payments by
participants and indirect participants to owners of beneficial interests in such
Global Note held through such Persons will be governed by standing instructions
and customary practices, as is now the case with securities registered in the
name of nominees for such customers, and will be the responsibility of such
participants and indirect participants.
The Notes shall be redeemable at the Company's option, in whole or in
part, at any time and shall be redeemable at the Holders' option upon a Sale of
a Significant Subsidiary, in each case as provided in Article Eleven.
The Notes are not entitled to the benefit of any sinking fund.
(d) Any money or securities paid or delivered by the Company to the
Trustee for any payment with respect to the Notes which remains unclaimed for
two years after the date such payment was due or such securities were
deliverable will be repaid or delivered to the Company and thereafter the Holder
will look only to the Company for payments thereof as an unsecured creditor, and
the Company shall not be liable to pay any taxes or other duties in connection
with such payments; provided, however, that unless otherwise provided by
applicable law, the right to receive payment of principal of any Note, to the
extent of any cash redemption, will become void
19
at the end of 10 years from the relevant date thereof or such shorter period as
may be prescribed by applicable law.
(e) The Notes may be issued in the form of one or more fully
registered Global Notes that will be deposited with, or on behalf of, the
Depositary and registered in the name of the Depositary's nominee. So long as
the Depositary or its nominee is the registered owner of a Global Note, such
Depositary or such nominee will be considered the sole owner or Holder of the
Notes represented by such Global Note for all purposes under this Indenture and
the Notes. Except as otherwise provided herein, owners of beneficial interests
in a Global Note will not be entitled to have Notes represented by a Global Note
registered in their names, will not receive or be entitled to receive physical
delivery of Notes in definitive form, and will not be considered the owners or
Holders thereof under this Indenture or the Notes. In addition, no beneficial
owner of an interest in a Global Note will be able to transfer that beneficial
interest except in accordance with the Depositary's or its participants'
applicable procedures.
SECTION 302. Denominations. The Notes shall be issuable in
-------------
registered form without coupons and only in denominations of $1,000 and any
integral multiple of $1,000 in excess thereof.
SECTION 303. Execution, Authentication, Delivery and Dating. (a)
----------------------------------------------
The Notes shall be executed on behalf of the Company by its Chairman of the
Board, its Vice Chairman of the Board, its President or one of its Vice
Presidents. The signature of any of these persons on the Notes may be manual or
facsimile. If an officer or board member of the Company whose signature is on a
Note no longer holds that position at the time the Trustee authenticates such
Note or at any time thereafter, the Note shall be valid nevertheless.
(b) At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Notes executed by the Company to the
Trustee for authentication, together with a Company Order for the authentication
and delivery of such Notes, and the Trustee in accordance with the Company Order
shall authenticate and deliver such Notes.
(c) Each Note shall be dated the date of its authentication.
(d) No Note shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any Note
shall be conclusive evidence, and the only evidence, that such Note has been
duly authenticated and delivered hereunder.
SECTION 304. Temporary Notes. Pending the preparation of definitive
---------------
Notes, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Notes which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Notes in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Notes may determine, as evidenced by
their execution of such Notes.
20
If temporary Notes are issued, the Company will cause definitive Notes
to be prepared without unreasonable delay. After the preparation of definitive
Notes, the temporary Notes shall be exchangeable for definitive Notes upon
surrender of the temporary Notes at the office or agency of the Company in a
Place of Payment, without charge to the Holder. Upon surrender for cancellation
of any one or more temporary Notes the Company shall execute and the Trustee
shall authenticate and deliver in exchange therefor a like principal amount of
definitive Notes of authorized denominations. Until so exchanged the temporary
Notes shall in all respects be entitled to the same benefits under this
Indenture as definitive Notes.
For purposes of this Section 304, each Global Note shall be considered
a definitive Note.
SECTION 305. Registration, Registration of Transfer and Exchange.
---------------------------------------------------
(a) The Company shall cause to be kept a register (which register will be
maintained in any office or agency of the Company maintained for such purpose in
the Borough of Manhattan, The City of New York, which initially shall be the
Corporate Trust Office of the Trustee and the office of any Paying Agent, and
being herein sometimes collectively referred to as the "Register") in which,
subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of Notes and of transfers of Notes. The Trustee is
hereby appointed "Registrar" for the purpose of registering Notes and transfers
of Notes as herein provided.
(b) Upon surrender for registration of transfer or exchange of any
Note at the office or agency maintained for such purpose, the Company shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Notes, of any authorized
denominations and of a like aggregate principal amount and tenor of each such
Note. All Notes issued upon any registration of transfer or exchange of Notes,
shall be the valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
(c) Every Note presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer (in form
satisfactory to the Company and the Registrar) duly executed, by the Holder
thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Notes (excluding any case in which such Notes have been mutilated,
destroyed, lost or stolen, in which case the Registrar may charge a reasonable
fee for replacement), but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Notes, other than exchanges
pursuant to Section 304, 906 or 1109 not involving any transfer.
(d) Neither the Company nor any Registrar or Transfer Agent shall be
required (i) to issue, register the transfer of, or exchange Notes during a
period beginning at the opening of business 15 days before the day of the
mailing of a notice of redemption of Notes selected for redemption under Section
1103 or 1106 and ending at the close of business on the day of such mailing,
(ii) to register the transfer of, or exchange, any Note so selected for
redemption in whole
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or in part, except the unredeemed portion of any Note being redeemed in part,
(iii) to register the transfer of, or exchange, any Note for a period from the
record date to the due date for any payment of principal of, or interest on, the
Notes or (iv) to issue, register the transfer of, or exchange, any Note which
has been surrendered for redemption at the option of the Holder, except the
portion, if any, of such Note not to be so redeemed.
(e) Notwithstanding any other provision of this Section 305, unless
and until it is exchanged in whole or in part for Notes in definitive registered
form, a Global Note representing all or a portion of the Notes may not be
transferred except as a whole by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary, and a Global Note may not be exchanged
for Notes in definitive form except as hereafter provided in this Section 305.
(f) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary or if at any time the Depositary
shall cease to be a clearing agency registered pursuant to the provisions of
Section 17A of the Exchange Act and any other applicable statute or regulation,
the Company shall appoint a successor Depositary. If a successor Depositary is
not appointed by the Company within 90 days after the Company receives such
notice or becomes aware of such ineligibility, the Company will execute, and the
Trustee, upon receipt of a Company Order for the authentication and delivery of
definitive Notes, will authenticate and deliver Notes in definitive registered
form, in any authorized denominations, in an aggregate principal amount equal to
the principal amount of the Global Note or Notes, in exchange for such Global
Note or Notes.
(g) If there shall have occurred and be continuing an Event of Default
with respect to the Notes, the Company will issue Notes in definitive form in
exchange for the Global Note representing such Notes. In such a case, the
Company will promptly execute, and the Trustee will execute, upon receipt of a
Company Order for the authentication and delivery of definitive Notes will
authenticate and deliver, Notes in definitive registered form, in any authorized
denominations, in an aggregate principal amount equal to the principal amount of
the Global Note or Notes, in exchange for such Global Note or Notes.
(h) The Company may at any time and in its sole discretion determine
that the Notes issued in the form of one or more Global Notes shall no longer be
represented by such Global Note or Notes. In such event, the Company will
execute, and the Trustee, upon receipt of a Company Order for the authentication
and delivery of definitive Notes will authenticate and deliver, Notes in
definitive registered form, in any authorized denominations, in an aggregate
principal amount equal to the principal amount of the Global Note or Notes, in
exchange for such Global Note or Notes.
(i) If specified by the Company with respect to the Notes, a Person
owning a beneficial interest in a Global Note or Notes may instruct the
Depositary to surrender such Global Note in exchange, in whole or in part, for
Notes in definitive registered form, on such terms as are acceptable to the
Company, the Trustee and the Depositary. Thereupon, the
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Company shall execute, and the Trustee shall authenticate and deliver, without
service charge to the Person specified by such Depositary, a new Note or Notes
of any authorized denomination as requested by such Person, in an aggregate
principal amount equal to, and in exchange for, such Person's beneficial
interest in the Global Note; and the Trustee shall endorse the Global Note to
reflect the reduction in the principal amount thereof by the amount delivered
pursuant to this clause.
Upon the exchange of a Global Note for Notes in definitive registered
form, such Global Note shall be canceled by the Trustee. Notes in definitive
registered form issued in exchange for a Global Note pursuant to this Section
305 shall be issued in denominations of $1,000 and integral multiples thereof
and registered in such names as the Depositary, pursuant to instructions from
its direct or indirect participants or otherwise, shall instruct the Trustee.
The Trustee shall deliver such Notes to, or as directed by, the Persons in whose
names such Notes are so registered.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Notes. If any
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mutilated Note is surrendered to the Trustee, the Company shall execute, and the
Trustee shall authenticate and deliver in exchange therefor, a new Note of like
tenor and principal amount and bearing a number not contemporaneously
outstanding.
If there shall be delivered to the Company and the Trustee (a)
evidence to their satisfaction of the destruction, loss or theft of any Note and
(b) such security or indemnity as may be required by them to save each of them
and any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Note has been acquired by a protected
purchaser, within the meaning of Article 8 of the New York Uniform Commercial
Code, the Company shall execute and the Trustee shall authenticate and deliver
in lieu of any such destroyed, lost or stolen Note, a new Note of like tenor and
principal amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Note has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Note, pay such Note.
Upon the issuance of any new Note under this Section 306, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Note issued pursuant to this Section in lieu of any
destroyed, lost or stolen Note, shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Note shall be at any time enforceable by anyone, and shall be entitled to
all the benefits of this Indenture equally and proportionately with any and all
other Notes duly issued hereunder.
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The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 307. Payment of Interest; Interest Rights Preserved. (a)
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Interest on any Note which is payable, and is punctually paid or duly provided
for, on any Interest Payment Date shall be paid to the Person in whose name that
Note (or one or more Predecessor Notes) is registered at the close of business
on the Regular Record Date for such interest.
(b) Any interest on any Note which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holder on the
relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in subclause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Notes (or their respective
Predecessor Notes) are registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be
paid on each Note and the date of the proposed payment, and at the
same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment,
such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this subclause
provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15
days and not less than 10 days prior to the date of the proposed
payment and not less than 10 days after the receipt by the Trustee of
the notice of the proposed payment. The Trustee shall promptly notify
the Company of such Special Record Date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor to be
mailed, first-class postage prepaid, to each Holder of Notes at such
Holder's address as it appears in the Register, not less than 10 days
prior to such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor having
been so mailed, such Defaulted Interest shall be paid to the Persons
in whose names the Notes (or their respective Predecessor Notes) are
registered at the
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close of business on such Special Record Date and shall no longer be
payable pursuant to the following subclause (2).
(2) The Company may make payment of any Defaulted Interest on
the Notes in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Notes may be
listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Trustee of the proposed
payment pursuant to this subclause, such manner of payment shall be
deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section 307, each Note
delivered under this Indenture upon registration of transfer of, in exchange for
or in lieu of, any other Note shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by such other Note.
SECTION 308. Persons Deemed Owners. Prior to due presentment of a
---------------------
Note for registration of transfer, the Company, the Trustee, any Authenticating
Agent, any Paying Agent or the Registrar and any agent of the Company, the
Trustee, any Authenticating Agent, any Paying Agent or the Registrar may treat
the Person in whose name such Note is registered as the owner of such Note for
the purpose of receiving payment of principal of, premium, if any, and (subject
to Section 307) any interest on, such Note and for all other purposes
whatsoever, whether or not such Note be overdue, and neither the Company, the
Trustee, any Authenticating Agent, any Paying Agent or the Registrar nor any
agent of the Company, the Trustee, any Authenticating Agent, any Paying Agent or
the Registrar shall be affected by notice to the contrary.
None of the Company, the Trustee, any Authenticating Agent, any Paying
Agent or the Registrar will have any responsibility or liability for any aspect
of the records relating to or payments made on account of beneficial ownership
interests in a Global Note or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
SECTION 309. Cancellation. All Notes surrendered for payment,
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redemption, registration of transfer or exchange shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee and shall be promptly
canceled by it. The Company may at any time deliver to the Trustee for
cancellation any Notes previously authenticated and delivered hereunder which
the Company may have acquired in any manner whatsoever, and all Notes so
delivered shall be promptly canceled by the Trustee. No Notes shall be
authenticated in lieu of or in exchange for any Notes canceled as provided in
this Section 309, except as expressly permitted by this Indenture. All canceled
Notes held by the Trustee shall be held by the Trustee in accordance with its
customary practices until destroyed by the Trustee; provided, however, that the
Trustee shall not be required to destroy such Notes.
The Company may not issue new Notes to replace Notes it has paid in
full or delivered to the Trustee for cancellation.
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SECTION 310. Computation of Interest. Interest on the Notes shall be
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computed on the basis of a 360-day year of twelve 30-day months.
SECTION 311. CUSIP Numbers. The Company in issuing the Notes may use
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"CUSIP" numbers (if then generally in use) in addition to serial numbers, and,
if so, the Trustee shall use such "CUSIP" numbers in addition to serial numbers
in notices of repurchase as a convenience to Holders; provided that any notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Notes or as contained in any notice of a repurchase and
that reliance may be placed only on the serial or other identification numbers
printed on the Notes, and any such repurchase shall not be affected by any
defect in, or omission of, such "CUSIP" numbers. The Company will promptly
notify the Trustee of any change in the "CUSIP" numbers.
ARTICLE FOUR
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SATISFACTION AND DISCHARGE
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SECTION 401. Satisfaction and Discharge of Indenture. (a) This
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Indenture shall upon Company Request cease to be of further effect (except as to
any surviving rights of registration of transfer or exchange of Notes herein
expressly provided for), and the Trustee, at the expense of the Company, shall
execute proper instruments acknowledging satisfaction and discharge of this
Indenture, when
(1) either
(A) all Notes theretofore authenticated and delivered
(other than (i) Notes that have been destroyed, lost or stolen
and which have been replaced or paid as provided in Section 306
and (ii) Notes for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the Company
and thereafter repaid to the Company or discharged from such
trust, as provided in Section 1003) have been delivered to the
Trustee for cancellation; or
(B) all Notes not theretofore delivered to the Trustee for
cancellation
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(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name,
and at the expense, of the Company, and
the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust
funds in trust for the purpose an amount sufficient to pay and
discharge the entire indebtedness on such Notes not theretofore
delivered to the Trustee for cancellation, for principal and
interest to the date of such deposit (in the case of Notes which
have become due and payable) or to Maturity;
(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, to the effect that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with.
(b) Notwithstanding the satisfaction and discharge of this Indenture,
the obligations of the Company to the Trustee under Section 607, the obligations
of the Trustee to any Authenticating Agent under Section 614, and, if money
shall have been deposited with the Trustee pursuant to subclause (B) of clause
(a)(1) of this Section, the obligations of the Trustee under Section 402 and the
last paragraph of Section 1003 shall survive.
SECTION 402. Application of Trust Money. Subject to the provisions
--------------------------
of the last paragraph of Section 1003, all money deposited with the Trustee
pursuant to Section 401 shall be held in trust and applied by it, in accordance
with the provisions of the Notes and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of
the principal, premium, if any, and interest for whose payment such money has
been deposited with the Trustee.
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ARTICLE FIVE
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REMEDIES
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SECTION 501. Events of Default. (a) "Event of Default," wherever
-----------------
used herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) default in the payment of any interest on any Note when it
becomes due and payable, and continuance of such default for a period
of 30 days; or
(2) default in the payment of the principal of, and premium, if
any, on, any Note at its Maturity; or
(3) default in the performance, or breach, of any covenant or
agreement of the Company under this Indenture (other than a default in
the performance, or breach, of a covenant or agreement that is
specifically dealt with elsewhere therein), and continuance of such
default or breach for a period of 60 days after there has been given,
by registered or certified mail, to the Company by the Trustee, or to
the Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Notes, a written notice specifying
such default or breach and requiring it to be remedied and stating
that such notice is a "Notice of Default" under this Indenture; or
(4) (i) an event of default shall have occurred under any
mortgage, bond, indenture, loan agreement or other document evidencing
any issue of Indebtedness of the Company or any Significant Subsidiary
for money borrowed, which issue has an aggregate outstanding principal
amount of not less than $10,000,000, and such default shall result in
such Indebtedness becoming, whether by declaration or otherwise, due
and payable prior to the date on which it would otherwise become due
and payable or (ii) a default in any payment when due at final
maturity of any such Indebtedness of the Company or any Significant
Subsidiary outstanding in an aggregate principal amount of not less
than $10,000,000, and, in each case, ten Business Days shall have
elapsed after such event, during which period such event shall not
have been cured or rescinded or such Indebtedness shall not have been
satisfied; or
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(5) final judgments or orders are rendered against the Company or
any Significant Subsidiary by a court or regulatory agency of
competent jurisdiction which require the payment in money, either
individually or in an aggregate amount, that is more than $10,000,000
and such judgment or order shall not be discharged and either (i) any
creditor shall have commenced an enforcement proceeding upon such
judgment or order, which enforcement proceeding shall have remained
unstayed for a period of 10 days or (ii) there shall have been a
period of 60 days after the date on which any period for appeal has
expired during which a stay of enforcement shall not be in effect; or
(6) a decree or order is entered by a court having jurisdiction
(i) for relief in respect of the Company or any Significant Subsidiary
in an involuntary case or proceeding under the Federal Bankruptcy Code
or any other federal or state bankruptcy, insolvency, reorganization
or similar law, including, without limitation, any such case or
proceeding under applicable state insurance laws, or (ii) adjudging
the Company or any Significant Subsidiary a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment or composition of, or
in respect of the Company or any Significant Subsidiary under the
Federal Bankruptcy Code or any other applicable federal or state law,
including, without limitation, any such case or proceeding under
applicable state insurance laws, or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company or any Significant Subsidiary or of any
substantial part of any of their assets, or ordering the winding up or
liquidation of any of their affairs, any such decree or order remains
unstayed and in effect for a period of 60 consecutive days; or
(7) the Company or any Significant Subsidiary institutes a
voluntary case or proceeding under the Federal Bankruptcy Code or any
other applicable federal or state law, including, without limitation,
any such case or proceeding under applicable state insurance laws, or
any other case or proceedings to be adjudicated a bankrupt or
insolvent, or the Company or any Significant Subsidiary consents to
the entry of a decree or order for relief in respect of the Company or
any Significant Subsidiary in any involuntary case or proceeding under
the Federal Bankruptcy Code or any other applicable federal or state
law, including, without limitation, any such case or proceeding under
applicable state insurance laws, or to the institution of bankruptcy
or insolvency proceedings against the Company or any Significant
Subsidiary, or the Company or any Significant Subsidiary files a
29
petition or answer or consent seeking reorganization or relief under
the Federal Bankruptcy Code or any other applicable federal or state
law, or consents to the filing of any such petition or to the
appointment of, or taking possession by, a custodian, receiver,
liquidator, assignee, trustee, sequestrator (or other similar
official) of any of the Company or any Significant Subsidiary or of
any substantial part of its property, or makes an assignment for the
benefit of creditors, or admits in writing its inability to pay its
debts generally as they become due or takes corporate action in
furtherance of any such action.
(b) Within five days of the occurrence of any Default, the Company
shall so notify the Trustee in writing.
SECTION 502. Acceleration of Maturity; Rescission and Annulment. If
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an Event of Default (other than as specified in Section 501(a) (6) and 501(a)
(7) with respect to the Company or any Significant Subsidiary) occurs and is
continuing, the Trustee or the Holders of not less than 25% in principal amount
of the Outstanding Notes may declare all unpaid principal of, and accrued
interest on, all the Notes to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), and upon any
such declaration such principal shall become due and payable immediately. If an
Event of Default specified in Section 501(a) (6) or 501(a) (7) above with
respect to the Company or any Significant Subsidiary occurs and is continuing,
then the principal of all Notes shall by such fact itself become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.
After a declaration of acceleration, but before a judgment or decree
for payment of the money due has been obtained by the Trustee, the Holders of at
least a majority in aggregate principal amount of the Outstanding Notes, by
written notice to the Company and the Trustee, may annul such declaration if (a)
the Company has paid or deposited with the Trustee a sum sufficient to pay (i)
all sums paid or advanced by the Trustee under this indenture and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, (ii) all overdue interest on all Notes, (iii) the principal of, and
premium, if any, on, any Notes which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate borne by the Notes,
and (iv) to the extent payment of such interest is lawful, interest upon overdue
interest at the rate borne by the Notes; and (b) all Events of Default, other
than the non-payment of principal of, and premium, if any, on, the Notes which
has become due solely by the declaration of acceleration, have been waived as
provided herein or cured. No such rescission shall affect any subsequent
default or impair any right consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
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Trustee. The Company covenants that if:
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30
(1) default is made in the payment of any interest on any Note
when such interest becomes due and payable and such default continues
for a period of 30 days, or
(2) default is made in the payment of the principal of, or
premium, if any, on, any Note at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Notes, the whole amount then due and payable on
such Notes for principal, premium, if any, and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and on any overdue interest, at the rate or rates prescribed therefor
in such Notes, and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon such Notes and collect the monies
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company or any other obligor upon such Notes, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders of Notes by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 504. Trustee May File Proofs of Claim. In case of any
--------------------------------
judicial proceeding relative to the Company (or any other obligor upon the
Notes), its property or its creditors, the Trustee shall be entitled and
empowered, by intervention in such proceeding or otherwise, to take any and all
actions authorized under the Trust Indenture Act in order to have claims of the
Holders and the Trustee allowed in any such proceeding. In particular, the
Trustee shall be authorized to file and prove a claim for the whole amount of
principal, premium, if any, and interest owing and unpaid in respect of the
Notes and to file such other papers or documents as may be necessary or
advisable in order to have claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel) and of the Holders allowed in such judicial proceeding,
and to collect and receive any moneys or other property payable or deliverable
on any such claims and to distribute the same; and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official in any
such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable
31
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 607.
No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Notes or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of Notes.
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All rights of action and claims under this Indenture and the Notes may be
prosecuted and enforced by the Trustee without the possession of any of the
Notes or the production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment shall, after provision for the
payment of the reasonable compensation, expenses, disbursement and advances of
the Trustee, its agents and counsel, be for the ratable benefit of the Holders
of the Notes in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected. Any money collected by
------------------------------
the Trustee pursuant to this Article shall be applied in the following order, at
the date or dates fixed by the Trustee and, in case of the distribution of such
money on account of principal or interest, upon presentation of the Notes and
the notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
First: To the payment of all amounts due the Trustee under
Section 607;
Second: To the payment of the amounts then due and unpaid for
principal of, and premium, if any, and interest on, the Notes 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 Notes for principal,
premium, if any, and interest, respectively; and
Third: The balance, to the Company or as a court of competent
jurisdiction may direct.
SECTION 507. Limitation on Suits. No Holder of any Note shall have
-------------------
any right to institute any proceeding, judicial or otherwise, with respect to
this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Notes shall have made written request to the
32
Trustee to institute proceedings in respect of such Event of Default
in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a
majority in principal amount of the Outstanding Notes; it being
understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights
of any other of such Holders, or to obtain or to seek to obtain
priority or preference over any other of such Holders or to enforce
any right under this Indenture, except in the manner herein provided
and for the equal and ratable benefit of all of such Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal and
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Interest. Notwithstanding any other provision in this Indenture, the Holder of
--------
any Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of, premium, if any, and (subject to Section 307)
interest on, such Note on the respective Stated Maturities of such payments
expressed in such Note (or, in the case of redemption, on the date of
redemption) and to institute suit for the enforcement of any such payment, and
such rights shall not be impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies. If the Trustee or
----------------------------------
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative. Except as otherwise
------------------------------
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Notes in the last paragraph of Section 306, no right or remedy
herein conferred upon or reserved to the Trustee or to the Holders is intended
to be exclusive of any other right or remedy, and every right and remedy shall,
to the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise.
33
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver. No delay or omission of
----------------------------
the Trustee or of any Holder of any Notes to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article or by law to the Trustee or to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
SECTION 512. Control by Holders. The Holders of at least a majority
------------------
in principal amount of the Outstanding Notes shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the Trustee, with
respect to the Notes; provided that
(1) such direction shall not be in conflict with any rule of law
or with this Indenture, expose the Trustee to personal liability or be
unduly prejudicial to Holders not joining therein, and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults. The Holders of not less than a
-----------------------
majority in principal amount of the Outstanding Notes may on behalf of the
Holders of all the Notes waive any past default hereunder and its consequences,
except a default
(1) in the payment of the principal of, premium, if any, or
interest on, any Note, or
(2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of the
Holder of each Outstanding Note affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
SECTION 514. Undertaking for Costs. In any suit for the enforcement
---------------------
of any right or remedy under this Indenture, or in any suit against the Trustee
for any action taken, suffered or omitted by it as Trustee, a court may require
any party litigant in such suit to file an undertaking to pay the costs of such
suit, and may assess costs against any such party litigant, in the manner and to
the extent provided in the Trust Indenture Act; provided that neither this
Section nor the Trust Indenture Act shall be deemed to authorize any court to
require such an undertaking or to make such an assessment in any suit instituted
by the Trustee, by any Holder, or group of Holders, holding in the aggregate
more than 10% in principal amount of the
34
Outstanding Notes, or by any Holder for the enforcement of the payment of the
principal of, premium, if any, or interest on, any Note on or after the Maturity
of such Note.
SECTION 515. Waiver of Stay or Extension Laws. The Company covenants
--------------------------------
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law and covenants that
they will not hinder, delay or impede the execution of any power herein granted
to the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
ARTICLE SIX
-----------
THE TRUSTEE
-----------
SECTION 601. Certain Duties and Responsibilities. (a) Except during
-----------------------------------
the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture; but in the case of any such certificates or
opinions which by any provision of this Indenture are specifically
required to be furnished to the Trustee, the Trustee shall be under a
duty to examine the same to determine whether or not they conform to
the requirements of this Indenture.
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
(1) this Subsection shall not be construed to limit the effect
of Subsection (a) of this Section;
35
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders of a majority in principal amount of the
Outstanding Notes 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 Notes; and
(4) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, unless it receives indemnity
satisfactory to it against any loss, liability or expense.
(d) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
(e) The duties and responsibilities of the Trustee shall be as
provided in the Trust Indenture Act and as set forth herein.
SECTION 602. Notice of Defaults. Within 90 days after the occurrence
------------------
of any Default hereunder with respect to Notes, the Trustee shall transmit by
mail to all Holders of Notes, as their names and addresses appear in the
Register, notice of such Default hereunder actually known to the Trustee, unless
such Default shall have been cured or waived; provided, however, that, except in
the case of a Default in the payment of the principal of, premium, if any, or
interest on, any Note, the Trustee shall be protected in withholding such notice
if and so long as the board of directors, the executive committee of directors
or a trust committee of directors and/or Responsible Officers of the Trustee in
good faith determine that the withholding of such notice is in the interests of
the Holders of the Notes; and provided, further, that in the case of any Default
of the character specified in Section 501(a) (3) with respect to the Notes, no
such notice to Holders shall be given until at least 60 days after the
occurrence thereof.
SECTION 603. Certain Rights of Trustee. Subject to the provisions of
-------------------------
Section 601:
(a) the Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
36
(b) any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by a Company Request or Company Order and
any resolution of the Board of Directors may be sufficiently evidenced by a
Board Resolution;
(c) whenever in the administration of this Indenture the Trustee
shall deem it desirable or necessary that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by, or pursuant to; this Indenture at the request
or direction of any of the Holders pursuant to this Indenture, unless such
Holders shall have offered to the Trustee security or indemnity satisfactory to
it against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
(g) 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;
(h) before the Trustee acts or refrains from acting, it may require
and shall be entitled to receive an Officers' Certificate or an Opinion of
Counsel that such action is required or permitted hereunder. The Trustee shall
not be liable for any action it takes or omits to take in good faith in reliance
on an Officers' Certificate or Opinion of Counsel; and
(i) in the event that the Trustee is also acting as Paying Agent,
Transfer Agent or Registrar hereunder, the protections of this Article shall
also be afforded to the Trustee in its capacity as Paying Agent, Transfer Agent
or Registrar.
SECTION 604. Not Responsible for Recitals or Issuance of Notes. The
-------------------------------------------------
recitals contained herein and in the Notes, except the Trustee's certificates of
authentication, shall be taken as the statements of the Company. Neither the
Trustee nor any Authenticating Agent assume any responsibility for the
correctness of such recitals. The Trustee makes no representations as to the
validity or sufficiency of this Indenture or of the Notes. The Trustee or
37
any Authenticating Agent shall not be accountable for the use or application by
the Company of Notes or the proceeds thereof.
SECTION 605. May Hold Notes. The Trustee, any Authenticating Agent,
--------------
any Paying Agent, any Registrar or any other agent of the Company, in its
individual or any other capacity, may become the owner or pledgee of Notes and,
subject to Sections 608 and 613, may otherwise deal with the Company with the
same rights it would have if it were not Trustee, Authenticating Agent, Paying
Agent, Registrar or such other agent.
SECTION 606. Money Held in Trust. Money held by the Trustee in trust
-------------------
hereunder 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 money
received by it hereunder except as otherwise agreed with the Company.
SECTION 607. Compensation and Reimbursement. The Company shall
------------------------------
(a) pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall
not be limited by any provision of law in regard to the compensation
of a trustee of an express trust);
(b) reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee
in accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance
as may be attributable to its gross negligence or bad faith; and
(c) indemnify the Trustee (and its officers, directors, agents
and employees) for, and to hold it harmless against, any loss,
damages, claim, liability or expense incurred without gross negligence
or bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder,
including the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of
its powers or duties hereunder.
As security for the performance of the obligations of the Company
under this Section, the Trustee shall have a lien prior to the Notes 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 Notes.
Any expenses incurred or services rendered by the Trustee (including
the fees and expenses of its counsel and agents) in connection with an Event of
Default as set forth in Sections 501(3), (5) or (6), and any compensation for
such services by the Trustee, are intended
38
to constitute expenses of administration under any bankruptcy law or other law
relating to creditors' rights generally. The obligations of the Company set
forth in this Section shall survive the payment in full of all amounts due and
owing hereunder and under the Notes, the termination and discharge of this
Indenture or the earlier resignation or removal of the Trustee.
SECTION 608. Disqualification; Conflicting Interests. If the Trustee
---------------------------------------
has or acquires a conflicting interest within the meaning of Section 310 of the
Trust Indenture Act, the Trustee shall either eliminate such interest or resign,
to the extent and in the manner provided by, and subject to the provisions of,
the Trust Indenture Act and this Indenture.
SECTION 609. Corporate Trustee Required; Eligibility. There shall at
---------------------------------------
all times be a Trustee hereunder which shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such and has a combined capital
and surplus of at least $50,000,000. If such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of Federal,
State, Territorial or District of Columbia supervising or examining authority,
then for the purposes of this Section 609, 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. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article.
SECTION 610. Resignation and Removal; Appointment of Successor. (a)
-------------------------------------------------
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 611.
(b) The Trustee may resign by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Trustee required by
Section 611 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee with
respect to the Notes.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Notes, delivered to the Trustee
and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608 after
written request therefor by the Company or by any Holder who has been
a bona fide Holder of a Note for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and
shall fail to resign after written request therefor by the Company or
by any such Holder, or
39
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then, in any
such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 512, any Holder who has been a
bona fide Holder of a Note for at least six months may, on behalf of
himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee or
Trustees and shall comply with the applicable requirements of Section 611. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Notes delivered to
the Company and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 611, become the successor Trustee and
supersede the successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders and accepted
appointment in the manner required by Section 611, any Holder who has been a
bona fide Holder of a Note for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to all
Holders of Notes in the manner provided in Section 106. Each notice shall
include the name of the successor Trustee and the address of its Corporate Trust
Office.
SECTION 611. Acceptance of Appointment by Successor. (a) Every
--------------------------------------
successor Trustee appointed hereunder 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, subject nevertheless to its lien, if any,
provided for in Section 607.
(b) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor
40
Trustee all such rights, powers and trusts referred to in paragraph (a) of this
Section, as the case may be.
(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.
SECTION 612. Merger, Conversion, Consolidation or Succession to
--------------------------------------------------
Business. Any corporation into which the Trustee may be merged or converted or
--------
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder; provided that
such corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Notes 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 Notes so authenticated with the same effect as if
such successor Trustee had itself authenticated such Notes.
SECTION 613. Preferential Collection of Claims Against Company. If
-------------------------------------------------
and when the Trustee shall be or become a creditor of the Company, the Trustee
shall be subject to the provisions of Section 311 of the Trust Indenture Act
regarding the collection of claims against the Company.
SECTION 614. Appointment of Authenticating Agent. (a) The Trustee
-----------------------------------
may appoint an Authenticating Agent or Agents which shall be authorized to act
on behalf of the Trustee to authenticate Notes issued upon original issue and
upon exchange, registration of transfer or partial redemption or repayment
thereof or pursuant to Section 306, and Notes so authenticated shall be entitled
to the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Notes by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business and in good standing under the laws of the United States of
America, any State or the District of Columbia, authorized under such laws to
act as Authenticating Agent, having a combined capital and surplus of no less
than $50,000,000 and subject to supervision or examination by Federal or State
authority. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, such Authenticating Agent shall
resign immediately in the manner and with the effect specified in this Section.
41
(b) Any corporation into which an Authenticating Agent may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
(c) An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company, such resignation not to take
effect until 30 days after the date said written notice is received. The
Trustee may at any time terminate the agency of an Authenticating Agent by
giving written notice thereof to such Authenticating Agent and to the Company.
Upon receiving such a notice of resignation or upon such a termination, or in
case at any time such Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, the Trustee may appoint a
successor Authenticating Agent which shall be acceptable to the Company and
shall mail written notice of such appointment by first-class mail, postage
prepaid, to all Holders of Notes, as their names and addresses appear in the
Register. Any successor Authenticating Agent upon acceptance of its appointment
thereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments pursuant to the
provisions of Section 607.
If an Authenticating Agent is appointed with respect to the Notes
pursuant to this Section, the Notes may have endorsed thereon, in addition to
the Trustee's certificate of authentication, an alternative certificate of
authentication in the following form:
This is one of the Notes referred to in the within-mentioned
Indenture.
Bankers Trust Company
As Trustee
By______________________________
As Authenticating Agent
By______________________________
Authorized Officer
42
ARTICLE SEVEN
-------------
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
-------------------------------------------------
SECTION 701. Company to Furnish Trustee Names and Addresses of
-------------------------------------------------
Holders. The Company will furnish or cause to be furnished to the Trustee:
-------
(a) semiannually, not more than 15 days after each Regular Record
Date, a list, in such form as such Trustee may reasonably require, of the names
and addresses of the Holders of Notes as of such Regular Record Date; 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; excluding from such list names and addresses received by the
Trustee in its capacity as Registrar.
SECTION 702. Preservation of Information; Communications to Holders.
------------------------------------------------------
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Registrar. The
Trustee may destroy any list furnished to it as provided in Section 701 upon
receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Notes, and the
corresponding rights and privileges of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) Every Holder of Notes, by receiving and holding the same, agrees
with the Company and the Trustee that neither the Company nor the Trustee nor
any agent of any of them shall be held accountable by reason of any disclosure
of information as to names and addresses of Holders made pursuant to the Trust
Indenture Act.
SECTION 703. Reports by Trustee. (a) The Trustee shall transmit to
------------------
Holders within 60 days after each May 15 beginning after the date of the first
issuance of the Notes such reports dated as of such date, if any, concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act as amended from time to time at the times and in the manner
provided pursuant thereto.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which any Notes are listed, with the Commission and with the Company. The
Company will notify the Trustee when any Notes are listed on any stock exchange.
SECTION 704. Reports by Company. The Company shall:
------------------
43
(a) file with the Trustee, within 15 days after the Company is
required to file the same with the Commission, copies of the annual reports and
of the information, documents, and other reports (or copies of such portions of
any of the foregoing as the Commission may from time to time by rules and
regulations prescribe) which the Company may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if
the Company is not required to file information, documents, or reports pursuant
to either of such sections, then it will file with the Trustee and the
Commission, in accordance with rules and regulations prescribed from time to
time by the Commission, such of the supplementary and periodic information,
documents and reports which may be required pursuant to Section 13 of the
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) file with the Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time by the Commission, such
additional information, documents, and reports with respect 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; and
(c) transmit by mail to the Holders, 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 (a) and (b) in this
Section as may be required by rules and regulations prescribed from time to time
by the Commission.
ARTICLE EIGHT
-------------
CONSOLIDATION, MERGER AND SALE OF ASSETS
----------------------------------------
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
----------------------------------------------------
(a) The Company shall not consolidate with or merge with or into any other
Person or, directly or indirectly, sell, assign, convey, transfer, lease or
otherwise dispose of all or substantially all of its properties and assets to
any Person or group of affiliated Persons unless at the time and after giving
effect thereto (i) either (A) the Company shall be the continuing corporation,
or (B) the Person (if other than the Company) formed by such consolidation or
into which the Company is merged or the Person which acquires by sale,
assignment, conveyance, transfer, lease or disposition the properties and assets
of the Company, substantially as an entirety (the "Surviving Entity") shall be a
corporation duly organized and validly existing under the laws of the United
States of America, any state thereof or the District of Columbia and shall, in
either case, expressly assume, by an indenture supplemental to this Indenture,
executed and delivered to the Trustee, in form satisfactory to the Trustee, all
the covenants and obligations of the Company under the Notes and this Indenture,
and this Indenture shall remain in full force and effect; (ii) immediately after
giving effect to such transaction on a pro forma basis, no Default or Event of
Default shall have occurred and be continuing; and (iii) if any of the property
or assets of the Company would thereupon become subject to any Lien, the
outstanding Notes shall be secured equally and ratably with (or prior to) the
obligation or liability secured by such Lien, unless the
44
Company could create such Lien under this Indenture without equally and ratably
securing the Notes.
(b) In connection with any consolidation, merger, transfer or lease,
the Company shall deliver, or cause to be delivered, to the Trustee, in form and
substance reasonably satisfactory to the Trustee, an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger, transfer or
lease, and the supplemental indenture in respect thereto, comply with the
provisions described in this Indenture and that all conditions precedent herein
provided for relating to such transaction have been complied with.
SECTION 802. Successor Substituted for the Company. Upon any
-------------------------------------
consolidation of the Company with, or merger of the Company into, any other
Person or the conveyance, transfer or lease of the properties and assets of the
Company substantially as an entirety in accordance with Section 801, the
successor Person formed by such consolidation or into which the Company is
merged or to which such conveyance, transfer or lease is made shall succeed to,
and be substituted for, and may exercise every right and power of, the Company
under this Indenture with the same effect as if such successor Person had been
named as the Company herein, and thereafter, except in the case of a lease, the
predecessor Person shall be relieved of all obligations and covenants under this
Indenture and the Notes.
ARTICLE NINE
------------
SUPPLEMENTAL INDENTURES
-----------------------
SECTION 901. Supplemental Indentures Without Consent of Holders.
--------------------------------------------------
Without the consent of any Holders, the Company, when authorized by a Board
Resolution, and the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto, in form satisfactory to the Trustee,
for any of the following purposes:
(1) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants of the Company
herein, in the Notes; or
(2) to add to the covenants of the Company for the benefit of the
Holders of all Notes or to surrender any right or power herein conferred
upon the Company; or
(3) to add any additional Events of Default; or
(4) to secure the Notes; or
(5) to supplement any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the defeasance and
discharge of Notes pursuant to Sections 1202 or 1203; provided, however,
that any such action shall not adversely affect the interests of the
Holders of Notes in any material respect; or
45
(6) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture; provided that such action
pursuant to this clause (6) shall not adversely affect the interests of
the Holders of Notes in any material respect.
SECTION 902. Supplemental Indentures With Consent of Holders. With
-----------------------------------------------
the consent of the Holders of not less than a majority in principal amount of
the Outstanding Notes, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Notes under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Note affected thereby:
(1) change the Stated Maturity of the principal of, or interest on,
any Note, or reduce the principal amount thereof, the premium, if any, or
the rate of interest thereon, or change any Place of Payment where, or
the currency in which, any Note or any amount due thereon is payable, or
impair the right to institute suit for the enforcement of any such
payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the date of redemption);
(2) reduce the percentage in principal amount of the Outstanding
Notes, the consent of whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is required for any waiver (of
compliance with certain provisions of this Indenture or certain defaults
hereunder and their consequences) provided for in this Indenture; or
(3) modify any of the provisions of this Section, Section 513 or
Section 1010, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Note affected
thereby.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures. In executing, or
------------------------------------
accepting the additional trusts created by, any supplemental indenture permitted
by this Article or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Section
601) shall be fully protected in relying upon, an Opinion of Counsel stating
that the execution of such supplemental indenture is authorized or permitted by
this Indenture. The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
46
SECTION 904. Effect of Supplemental Indentures. Upon the execution
---------------------------------
of any supplemental indenture under this Article, this Indenture shall be
modified in accordance therewith, and such supplemental indenture shall form a
part of this Indenture for all purposes; and every Holder of Notes theretofore
or thereafter authenticated and delivered hereunder shall be bound thereby.
SECTION 905. Conformity with Trust Indenture Act. Every supplemental
-----------------------------------
indenture executed pursuant to this Article shall conform to the requirements of
the Trust Indenture Act as then in effect.
SECTION 906. Reference in Notes to Supplemental Indentures. Notes
---------------------------------------------
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article may, and shall if required by the Trustee, bear a
notation in form approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new Notes so modified
as to conform, in the opinion of the Trustee and the Company, to any such
supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding Notes.
ARTICLE TEN
-----------
COVENANTS
---------
SECTION 1001. Payment of Principal and Interest. The Company
---------------------------------
covenants and agrees that it shall duly and punctually pay the principal of,
premium, if any, and interest on, the Notes in accordance with the terms of the
Notes and this Indenture.
SECTION 1002. Maintenance of Office or Agency. (a) The Company
-------------------------------
shall maintain in each Place of Payment an office or agency where Notes may be
presented or surrendered for payment, where Notes may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Company in respect of the Notes and this Indenture may be served. The
Company hereby initially appoints the Trustee its office or agency for each of
said purposes. The Company shall give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency. If at
any time the Company shall fail to maintain any such required office or agency
or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
(b) The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in each
Place of Payment for Notes for such purposes. The Company shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
47
SECTION 1003. Money for Notes Payments to be Held in Trust. (a) If
--------------------------------------------
the Company shall at any time act as its own Paying Agent, it shall, on or
before each due date of the principal of, premium, if any, or interest on, any
of the Notes, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the amount so becoming due until such
sums shall be paid to such Persons or otherwise disposed of as herein provided
and shall promptly notify the Trustee of its action or failure so to act.
(b) Whenever the Company shall have one or more Paying Agents, it
shall, on or prior to each due date of the principal of, premium, if any, or
interest on, any Notes, deposit with such Paying Agent(s) a sum sufficient to
pay the amount then becoming due, such sum to be held as provided by the Trust
Indenture Act, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure so to act.
(c) The Company shall cause each Paying Agent other than the Trustee
to execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of,
premium, if any, or interest on, Notes in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided;
(2) give the Trustee notice of any Default by the Company (or any
other obligor upon the Notes) in the making of any payment in respect of
the Notes; and
(3) at any time during the continuance of any such Default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums
held in trust by such Paying Agent for payment in respect of the Notes.
(d) The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts 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.
(e) Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of, premium, if
any, or interest on, any Note and remaining unclaimed for two years after such
amount has become due and payable shall be paid to the Company on Company
Request, or (if then held by the Company) shall be discharged from such trust;
and the Holder of such Note shall thereafter, as an unsecured general creditor,
look only to the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in a newspaper
published in the English language, customarily published on each
48
Business Day and of general circulation in each Place of Payment, or mail to
each such Holder, or both, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such publication or mailing, any unclaimed balance of such money then
remaining will be repaid to the Company.
SECTION 1004. Statement by Officers as to Default. The Company shall
-----------------------------------
deliver to the Trustee, within 120 days after the end of each fiscal year of the
Company ending after the date hereof, an Officers' Certificate, stating whether
or not to the best knowledge of the signers thereof the Company is in default in
the performance and observance of any of the terms, provisions and conditions of
this Indenture (without regard to any period of grace or requirement of notice
provided hereunder) and, if the Company shall be in default, specifying all such
Defaults and the nature and status thereof of which they may have knowledge.
SECTION 1005. Existence. Subject to Article Eight, the Company, on
---------
behalf of itself and its Significant Subsidiaries, shall do or cause to be done
all things necessary to preserve and keep in full force and effect (i) their
respective corporate existence, and (ii) their respective material rights
(charter and statutory); provided, however, that the Company shall not be
required to preserve the existence of any such Significant Subsidiary or any
such right if the Board of Directors of the Company shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company, and that the loss thereof is not disadvantageous to the Holders in
any material respect.
SECTION 1006. Limitation on Liens. The Company shall not , and shall
-------------------
not permit any of its Significant Subsidiaries, at any time, directly or
indirectly, to create, assume, incur or permit to exist any Indebtedness secured
by a Lien of any kind on any of the Company's property or assets (which, for the
avoidance of doubt, shall not include any of the property or assets of the
Company's Subsidiaries) or any share of Capital Stock of any Significant
Subsidiary owned by the Company or a Significant Subsidiary without making
effective provision whereby the Notes then Outstanding shall be equally and
ratably secured with such secured Indebtedness so long as such other
Indebtedness shall be secured; provided that the Lien securing any Subordinated
Indebtedness shall be subordinate and junior to the Lien securing the Notes with
the same relative priority as such Subordinated Indebtedness shall have with
respect to the Notes; and provided, further, that this covenant shall not apply
to any Liens securing any such indebtedness which became Indebtedness of the
Company or any of its Subsidiaries pursuant to a transaction subject to the
provisions of Article Eight or Liens securing Acquired Indebtedness and, in each
case, which Liens were in existence at the time of such transaction or the
incurrence of such Acquired Indebtedness (unless such Indebtedness was incurred
or such Lien created in connection with, or in contemplation of, such
transaction or incurrence of such Acquired Indebtedness), so long as such Liens
do not extend to or cover any property or assets of the Company or any of its
Significant Subsidiaries other than property or assets acquired in such
transaction or securing such Acquired Indebtedness prior to its incurrence; and
provided, further, however that this covenant shall not apply to (i) any Liens
created in connection with the incurrence of any Indebtedness of the Company or
any of its Significant Subsidiaries consisting of capital lease obligations or
of purchase money indebtedness (ii), amounts, if any, deposited in trust or in
escrow for the defeasance or redemption of the Company's 9 1/2% Senior Notes due
49
2000 or (iii) Liens securing Indebtedness of a Subsidiary that becomes a
Significant Subsidiary, which Liens are in existence as of the end of the fiscal
quarter immediately preceding the fiscal quarter during which such Subsidiary
becomes a Significant Subsidiary.
If the Company shall hereafter be required to secure the Notes equally
and ratably with any other Indebtedness pursuant to this covenant, (i) the
Company shall promptly deliver to the Trustee an Officers' Certificate stating
that the foregoing covenant has been complied with, and an Opinion of Counsel
stating that in the opinion of such counsel the foregoing covenant has been
complied with and that any instruments executed by the Company or any
Subsidiary, as the case may be, in the performance of the foregoing covenant
comply with the requirements of the foregoing covenant and (ii) the Trustee is
hereby authorized to enter into an indenture or agreement supplemental thereto
and to take such action, if any, as it may deem advisable to enable it to
enforce the rights of the Holders of the Notes so secured.
SECTION 1007. Limitation on Sale or Issuance of Stock of Subsidiaries.
------------------------------------------------------
Except for a transaction subject to the provisions of Article Eight, the Company
shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, sell, transfer, convey or otherwise dispose of (other than to the
Company or a wholly-owned Subsidiary of the Company) any Capital Stock of a
Subsidiary of the Company or any Notes convertible into, or warrants, rights or
options to subscribe for, Capital Stock of any Subsidiary of the Company, and
the Company shall not permit any of its Subsidiaries to issue or sell (other
than to the Company or a wholly-owned Subsidiary of the Company) any of its
Capital Stock or securities convertible into or rights, warrants or options to
subscribe for its Capital Stock; provided, however, that this covenant shall not
prohibit (a) the sale, transfer, conveyance or other disposition of (i) all, but
not less than all, of the issued and outstanding Capital Stock of any
Significant Subsidiary owned by the Company or any of its Subsidiaries, or (ii)
all or any portion of the issued and outstanding Capital Stock of any Subsidiary
of the Company that is not a Significant Subsidiary, if in either such case (x)
the sale, transfer, conveyance or other disposition is for Fair Market Value,
(y) the Company delivers to the Trustee a written opinion of a nationally
recognized investment banking firm attesting to such value (provided that this
clause (y) shall not apply to any transaction described in clause (a)(ii) above
for total consideration less than $10,000,000), and (z) at least 75% of the
consideration is for any combination of cash or cash equivalents, at the time
such stock is sold, transferred, conveyed or disposed of, and such issuance and
sale is otherwise in compliance with the other provisions of this Indenture, or
(b) the ownership by directors of director's qualifying shares to the extent
mandated by applicable law.
SECTION 1008. Limitation on Dividends and Other Payment Restrictions
------------------------------------------------------
Affecting Significant Subsidiaries. The Company shall not, and shall not permit
----------------------------------
any Significant Subsidiary to, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or consensual restriction of any
kind on the ability of any Significant Subsidiary to (a) pay dividends or make
any other distribution on its Capital Stock, (b) pay any Indebtedness owed to
the Company or any other Subsidiary, (c) make loans or advances to the Company
or any other Subsidiary, or (d) transfer any of its property or assets to the
Company or any other Subsidiary, except (i) any such encumbrance or restriction
pursuant to an agreement in effect on the date of this instrument, (ii) any such
encumbrance or restriction, with respect to a Subsidiary
50
that is not a Subsidiary of the Company on the date of this instrument, in
existence at the time such Person becomes a Subsidiary of the Company (except to
the extent such encumbrance or restriction was incurred or created in connection
with or in contemplation of such Person becoming a Subsidiary of the Company),
which encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person or the property or
assets of the Person that becomes a Subsidiary of the Company, (iii) any such
encumbrance or restriction pursuant to any law, any governmental regulation or
order or any agreement with a governmental regulator; provided that the Company
has used reasonable best efforts to have any such order or agreement diminished
or removed by any regulator authorized to do so and to obtain any exemptive
orders from the relevant regulator with respect to such encumbrance or
restriction to the extent such exemptive orders are reasonably suitable under
applicable laws and regulations, (iv) any such encumbrance or restriction in
existence as of the end of the fiscal quarter immediately preceding the fiscal
quarter during which such Subsidiary becomes a Significant Subsidiary, and (v)
any such encumbrance or restriction pursuant to any agreement that extends,
refinances, renews or replaces any agreement containing any of the restrictions
described in the foregoing clauses (i) and (ii); provided that the terms and
conditions of any such encumbrances or restrictions are not materially less
favorable to the Holders of the Notes than those under or pursuant to the
agreement extended, refinanced, renewed or replaced.
SECTION 1009. Redemption of 9 1/2% Senior Notes Due 2000 1/2. If any
------------------------------------------
of the Company's 9 1/2% Senior Notes due 2000 are outstanding, within 90 days
following the Company's receipt of proceeds from an offering of the Notes, the
Company shall (i) give notice of redemption to the holders of such amount of the
9 1/2% Senior Notes as may be redeemed using the aggregate net proceeds to the
Company of an offering of the Notes and (ii) deposit with the Trustee or a
Paying Agent for such 9 1/2% Senior Notes up to the aggregate amount of such
proceeds to pay the Redemption Price (as defined in the Old Indenture) of the
9 1/2% Senior Notes called for redemption on the Redemption Date specified in
such notice of redemption, in each case in accordance with the terms of the
indenture governing the 9 1/2 Senior Notes (the "Old Indenture"). Unless the
context otherwise requires, capitalized terms used but not defined in this
Section 1009 shall have the meanings ascribed thereto in the Old Indenture.
SECTION 1010. Waiver of Certain Covenants. The Company may omit in
---------------------------
any particular instance to comply with any term, provision or condition set
forth in Section 801 and in Sections 1006 to 1008, inclusive, with respect to
the Notes if before the time for such compliance the Holders of at least a
majority in principal amount of the Outstanding Notes shall, by Act of such
Holders, either waive such compliance in such instance or generally waive
compliance with such term, provision or condition, but no such waiver shall
extend to or affect such term, provision or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such term,
provision or condition shall remain in full force and effect.
ARTICLE ELEVEN
--------------
REDEMPTION OF NOTES
-------------------
SECTION 1101. Applicability of Article. The redemption of Notes at
------------------------
the election of the Company or otherwise, as permitted or required by any
provision of this Indenture, shall be made in accordance with such provision and
this Article.
SECTION 1102. Optional Redemption. (a) The Notes shall be
-------------------
redeemable, in whole or in part, at the Company's option under the circumstances
and at the Redemption Price specified in the form of Notes set forth in Sections
202 and 203.
51
(b) The Notes shall be redeemable, in whole or in part, at the option
of each Holder in the event of a Sale of a Significant Subsidiary and at the
Redemption Price specified in the form of Notes set forth in Sections 202 and
203.
SECTION 1103. Election to Redeem; Notice to Trustee. The election of
-------------------------------------
the Company to redeem any Notes shall be evidenced by a Board Resolution. In
case of any redemption pursuant to Section 1102 of less than all the Notes, the
Company shall, at least 40 but not more than 60 days prior to the date of
redemption fixed by the Company (unless shorter notice shall be satisfactory to
the Trustee), notify the Trustee in writing of such date of redemption and of
the principal amount of Notes to be redeemed.
SECTION 1104. Selection by Trustee of Notes to be Redeemed. If less
--------------------------------------------
than all the Notes are to be redeemed pursuant to Section 1102(a), the
particular Notes to be redeemed shall be selected by the Trustee within three
Business Days after it receives the notice described in Section 1103, from the
Outstanding Notes not previously called for redemption, by such method as the
Trustee shall deem fair and appropriate. If the Company shall so specify, Notes
owned of record and beneficially by the Company or any Subsidiary shall not be
included in the Notes selected for redemption. The Trustee shall promptly
notify the Company and each Registrar in writing of the Notes selected for
redemption and, in the case of any Notes selected for partial redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Notes shall relate, in
the case of any Notes redeemed or to be redeemed only in part, to the portion of
the principal amount of such Notes which has been or is to be redeemed.
SECTION 1105. Notice of Redemption at the Option of the Company.
-------------------------------------------------
Notice of redemption at the election of the Company shall be given not less than
30 nor more than 60 days prior to the date of redemption, to each Holder of
Notes to be redeemed, in accordance with Section 106.
All notices of redemption at the election of the Company shall state:
(1) the date of redemption,
(2) the Redemption Price that would apply if the date of redemption
were the date of such notice and a statement that the Redemption Price will be
calculated giving effect to the yield on certain United States Treasury
securities as of the third Business Day prior to the date of redemption,
(3) if less than all the Outstanding Notes are to be redeemed, the
identification (and, in the case of partial redemption of any Notes, the
principal amounts) of the particular Notes to be redeemed,
52
(4) that, on the date of redemption, the Redemption Price will become
due and payable upon each such Note to be redeemed and, if applicable,
that interest thereon will cease to accrue on and after said date,
(5) the place or places where such Notes are to be surrendered for
payment of the Redemption Price, which shall be the office of the
Trustee, and
(6) in the case of a Note to be redeemed in part, the principal amount
of such Note to be redeemed and that after the date of redemption upon
surrender of such Note, a new Note or Notes in the aggregate principal
amount equal to the unredeemed portion thereof will be issued.
Notice of redemption of Notes to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
SECTION 1106. Procedure and Notice for Redemption at the Option of
----------------------------------------------------
Each Holder. (a) Within 20 days after the occurrence of a Sale of a
-----------
Significant Subsidiary, the Company shall transmit to the Trustee, in accordance
with Section 105, and by mail to each Holder, in accordance with Section 106, as
such Holders' names and addresses appear in the Register, a notice (i)
specifying that such Sale of a Significant Subsidiary has occurred and (ii)
offering to redeem Notes pursuant to Section 1102(b) and the Notes. The Trustee
shall be under no obligation to ascertain the occurrence of a Sale of a
Significant Subsidiary. The notice of Sale of a Significant Subsidiary shall
contain all instructions and materials necessary to enable Holders to tender
Notes, including:
(1) a description of the Sale of a Significant Subsidiary and
the date such sale is deemed to have occurred for purposes of this
Section 1106;
(2) the Redemption Price;
(3) the date by which the Holder must deliver a notice of
election to participate in the redemption;
(4) the date of redemption, which shall be a Business Day that is
not less than 30 nor more than 60 days from the date such notice of
Sale of a Significant Subsidiary is furnished, or such later date as
is necessary to comply with requirements under the Exchange Act;
(5) a statement that Notes tendered by the Holder thereof shall,
on the date of redemption, become due and payable at the Redemption
Price, and from and after such date (unless the Company shall default
in the payment of the Redemption Price) such Notes shall cease to bear
interest;
53
(6) and a brief description of the rights and procedures for
delivering and withdrawing a notice of election, and a statement of
the place or places where Notes are to be surrendered for payment of
the Redemption Price, which shall be the office or agency of the
Company in each Place of Payment.
(b) A Holder shall deliver to any Paying Agent a notice of election
at any time prior to the close of business on the date of redemption,
stating (A) the certificate number of the Note that the Holder will
deliver to be redeemed and (B) the portion of the principal amount of the
Note that the Holder will deliver to be redeemed, which portion must be
$1,000 or an integral multiple thereof, and shall deliver such Note to
such Paying Agent at such office prior to, or on, the date of redemption
(together with all necessary endorsements), such delivery being a
condition to receipt by the Holder of the Redemption Price therefor. If
a Holder has elected to deliver for redemption by the Company less than
the entire principal amount of a Note, and if the principal amount of
such portion is $1,000 or an integral multiple thereof, the Company shall
redeem such portion from the Holder thereof pursuant to this Section
1106, and shall issue a new Note or Notes in the aggregate principal
amount equal to the unredeemed portion, if any, thereof. Each Paying
Agent shall promptly notify the Company of the receipt by the former of
any and all such notices of election and any and all written notices of
withdrawal thereof.
(c) The Company shall comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in
connection with the repurchase of the Notes upon a Sale of a Significant
Subsidiary and may modify an offer to purchase Notes pursuant to this
Section 1106 to effect such compliance.
(d) A notice of election may be withdrawn before or after delivery by
the Holder to the relevant Paying Agent of the Note to which such notice
of election relates, by means of a written notice of withdrawal (by
facsimile transmission or letter) received by the Trustee not later than
the date of redemption, specifying, as applicable:
(1) the certificate number of the Note in respect of which such
notice of withdrawal is being submitted;
(2) the principal amount of the Notes with respect to which such
notice of withdrawal is being submitted; and
(3) the principal amount, if any, of the Note that remains
subject to the original notice of election and which has been or will
be delivered for purchase by the Company.
Each Paying Agent shall promptly return to the prospective Holders
thereof any Notes with respect to which a notice of election has been
withdrawn in compliance with this Indenture.
54
SECTION 1107. Deposit of Redemption Price. On or prior to any date
---------------------------
of redemption, the Company shall deposit with the Trustee or with a Paying Agent
(or, if the Company is acting as its own Paying Agent, segregate and hold in
trust as provided in Section 1003) an amount of money sufficient to pay the
Redemption Price of, and (except if the date of redemption shall be an Interest
Payment Date) accrued interest on, all the Notes which are to be redeemed on
that date.
SECTION 1108. Notes Payable on Date of Redemption. Notice of
-----------------------------------
redemption or notice of election having been given as aforesaid, or notice of
election having been received by the Paying Agent and the related Note having
been delivered as aforesaid, the Notes so to be redeemed shall, on the date of
redemption, become due and payable at the Redemption Price therein specified,
and from and after such date (unless the Company shall default in the payment of
the Redemption Price and accrued interest) such Notes shall cease to bear
interest. Upon surrender of any such Note for redemption in accordance with said
notice, such Note shall be paid by the Company at the Redemption Price, together
with accrued interest to the date of redemption; provided, however, that, unless
otherwise specified as contemplated by Section 301, installments of interest
whose Stated Maturity is on or prior to the date of redemption will be payable
to the Holders of such Notes, or one or more Predecessor Notes, registered as
such at the close of business on the relevant Record Dates according to their
terms and the provisions of Section 307.
If any Note called or tendered for redemption shall not be so paid
upon surrender thereof for redemption, the principal shall, until paid, bear
interest from the date of redemption at the rate prescribed therefor in the
Note.
SECTION 1109. Notes Redeemed in Part. Any Note which is to be
----------------------
redeemed only in part shall be surrendered at a Place of Payment therefor (with,
if the Company or the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company and the Trustee duly
executed by, the Holder thereof or his attorney duly authorized in writing), and
the Company shall execute, and the Trustee shall authenticate and deliver to the
Holder of such Note, without service charge, a new Note or Notes of any
authorized denomination as requested by such Holder in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Note so surrendered. If a Global Note is so surrendered, such new Note so
issued shall be a new Global Note.
ARTICLE TWELVE
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LEGAL DEFEASANCE AND COVENANT DEFEASANCE
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SECTION 1201. Company's Option to Effect Defeasance or Covenant
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Defeasance'. The Company may, at its option, evidenced by a Board Resolution,
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at any time, elect to have either Section 1202 or Section 1203 hereof be applied
to all Outstanding Notes upon compliance with the conditions set forth in this
Article Twelve.
SECTION 1202. Legal Defeasance and Discharge. Upon the Company's
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exercise of the above option applicable to this Section with respect to the
Outstanding Notes, the
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Company shall be deemed to have been discharged from its obligations with
respect to the Outstanding Notes on and after the date the conditions precedent
set forth below are satisfied (hereinafter, "legal defeasance"). For this
purpose, such legal defeasance means that the Company shall be deemed to have
paid and discharged the entire indebtedness represented by the Outstanding Notes
and to have satisfied all its other obligations under such Notes and this
Indenture insofar as such Notes are concerned (and the Trustee, at the expense
of the Company, shall execute proper instruments acknowledging the same), except
for the following which shall survive until otherwise terminated or discharged
hereunder: (1) the rights of Holders of Outstanding Notes to receive, solely
from the trust fund described in Section 1204 as more fully set forth in such
Section, payments in respect of the principal of, premium, if any, and interest
on, such Notes to Maturity, (2) the Company's obligations with respect to such
Notes under Sections 305, 306, 607, 1002 and 1003 and such obligations as shall
be ancillary thereto, (3) the rights, powers, trusts, duties and immunities of
the Trustee, and (4) this Article Twelve. Subject to compliance with this
Article Twelve, the Company may exercise its option under this Section 1202
notwithstanding the prior exercise of its option under Section 1203.
SECTION 1203. Covenant Defeasance. Upon the Company's exercise of
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the above option applicable to this Section with respect to the Outstanding
Notes, the Company shall be released from its obligations under Sections 801,
1006, 1007, 1008, 1102(b) and 1106, and the occurrence of an event specified in
subclause (a)(3) of Section 501 with respect to any of Sections 801, 1006, 1007,
1008, 1102(b) or 1106 shall not be deemed to be an Event of Default with respect
to the Outstanding Notes on and after the date the conditions set forth below
are satisfied (hereinafter, "covenant defeasance"). For this purpose, such
covenant defeasance means that, with respect to the Outstanding Notes, the
Company may omit to comply with, and shall have no liability in respect of, any
term, condition or limitation set forth in any such Section or clause whether
directly or indirectly by reason of any reference elsewhere herein to any such
Section or clause or by reason of any reference to any such Section or clause to
any other provision herein or in any other document, but the remainder of this
Indenture and such Notes shall be unaffected thereby.
SECTION 1204. Conditions to Legal Defeasance or Covenant Defeasance.
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The following shall be the conditions precedent to application of either Section
1202 or Section 1203 to the Outstanding Notes:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of such Notes, cash in U.S. dollars, U.S.
Government Obligations, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and interest on, the
Outstanding Notes to Maturity. Before such a deposit, the Company may make
arrangements satisfactory to the Trustee for the redemption of Notes at a future
date or dates in accordance with Article Eleven, which shall be given effect in
applying the foregoing;
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(2) In the case of legal defeasance, the Company shall have delivered
to the Trustee an Opinion of Counsel stating that (A) the Company has received
from, or there has been published by, the Internal Revenue Service a ruling or
(B) since the date of this Indenture, there has been a change in the applicable
federal income tax law, in either case to the effect that, and based thereon,
such Opinion of Counsel shall confirm that, the Holders of the Outstanding Notes
will not recognize income, gain or loss for federal income tax purposes as a
result of such legal defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as would have been the
case if such legal defeasance had not occurred;
(3) In the case of covenant defeasance, the Company shall have
delivered to the Trustee an Opinion of Counsel in the United States to the
effect that the Holders of the Outstanding Notes will not recognize income, gain
or loss for federal income tax purposes as a result of such covenant defeasance
and will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such covenant
defeasance had not occurred;
(4) No Default or Event of Default shall have occurred and be
continuing on the date of such deposit, after giving effect thereto, or, in the
case of legal defeasance, insofar as subclauses (a)(6) and (a)(7) under Section
501(a) are concerned, at any time in the period ending the 91st day after the
date of deposit;
(5) Such legal defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument to which the Company or any of its Significant Subsidiaries is a
party or by which the Company or any of its Significant Subsidiaries is bound;
(6) The Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders of Notes over the other creditors of the Company with
the intent of defeating, hindering, delaying or defrauding creditors of the
Company or others; and
(7) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the legal defeasance or the covenant
defeasance, as the case may be, have been complied with.
SECTION 1205. Deposited Money and U.S. Government Obligations to be
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Held in Trust; Other Miscellaneous Provisions. Subject to the provisions of the
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last paragraph of Section 1003, all money and U.S. Government Obligations
(including the proceeds thereof) deposited with the Trustee pursuant to Section
1204 in respect of the Outstanding Notes shall be held in trust and applied by
the Trustee, in accordance with the provisions of such Notes and this Indenture,
to the payment, either directly or through any Paying Agent (but not including
the Company acting as its own Paying Agent) as the Trustee may determine, to the
Holders of such Notes, of all sums due and to become due thereon in respect of
principal and interest, but such money need not be segregated from other funds
except to the extent required by law.
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The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the money or U.S. Government
Obligations deposited pursuant to Section 1204 or the principal and interest
received in respect thereof.
Anything herein to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon Company Request any money
or U.S. Government Obligations held by it as provided in Section 1204 which, in
the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof which would then be required to be deposited to
effect an equivalent legal defeasance or covenant defeasance.
SECTION 1206. Reinstatement. If the Trustee or the Paying Agent is
-------------
unable to apply any money in accordance with Section 1202 or 1203 with respect
to the Notes by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, then
the Company's obligations under this Indenture and the Notes shall be revived
and reinstated as though no deposit had occurred pursuant to this Article Twelve
until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance with Section 1202 or 1203; provided, however, that if the
Company makes any payment of the principal of or interest on any such Note
following the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Notes to receive such payment from the
money held by the Trustee or the Paying Agent.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
PRESIDENTIAL LIFE CORPORATION
By: ___________________________________
Name: Xxxxxxx Xxxx
Title: Director and President
By: ___________________________________
Name:
Title:
BANKERS TRUST COMPANY, as Trustee
By: ___________________________________
Name:
Title:
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