EXHIBIT 4.1
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CONTIFINANCIAL CORPORATION
___________________
INDENTURE
Dated as of March 4, 1998
The Bank of New York
Trustee
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Reconciliation and tie between Indenture, dated as of
March 4, 1998 and the Trust Indenture Act of 1939, as amended ("TIA").
TIA Section Indenture Section
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310(a)(1)................................................................ 6.09
(a)(2)................................................................ 6.09
(a)(3)................................................................ Not Applicable
(a)(4)................................................................ Not Applicable
(a)(5)................................................................ 6.09
(b)................................................................... 6.10
311(a)................................................................... 6.13
(b)................................................................... 6.13
(c)................................................................... Not Applicable
312(a)................................................................... 7.01; 7.02(a)
(b)................................................................... 7.02(b)
(c)................................................................... 7.02(c)
313(a)................................................................... 7.03
(b)................................................................... 7.03
(c)................................................................... 7.03
(d)................................................................... 7.03(b)
314(a)................................................................... 7.04; TIA
(b)................................................................... Not Applicable
(c)(1)................................................................ 1.03
(c)(2)................................................................ 1.03
(c)(3)................................................................ Not Applicable
(d)................................................................... Not Applicable
(e)................................................................... 1.03
315(a)................................................................... 6.01(a); 6.03; 6.08
(b)................................................................... 6.02
(c)................................................................... 6.01(b)
(d)(1)................................................................ 6.01(c)(1)
(d)(2)................................................................ 6.01(c)(2)
(d)(3)................................................................ 6.01(c)(3)
(e)................................................................... 5.15
316(a)(1)(A)............................................................. 5.12
(a)(1)(B)............................................................. 5.13
(a)(2)................................................................ Not Applicable
(b)................................................................... Not Applicable
(c)................................................................... Not Applicable
317(a)(1)................................................................ 5.03
(a)(2)................................................................ 5.04
(b)................................................................... 10.03
318(a)................................................................... 1.09
(b)................................................................... 1.09
(c)................................................................... 1.09
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This reconciliation and tie section does not constitute part of the Indenture.
TABLE OF CONTENTS
ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION........................................1
Section 1.01 Definitions................................................................................1
Section 1.02 Other Definitions.........................................................................23
Section 1.03 Compliance Certificates and Opinions......................................................23
Section 1.04 Form of Documents Delivered to Trustee....................................................24
Section 1.05 Acts of Holders; Record Dates.............................................................24
Section 1.06 Notices, Etc., to Trustee and Company.....................................................26
Section 1.07 Notice to Holders; Waiver.................................................................26
Section 1.08 Incorporators, Stockholders, Officers and Directors of Company, Exemption from Individual
Liability.................................................................................27
Section 1.09 Conflict with Trust Indenture Act.........................................................27
Section 1.10 Effect of Headings and Table of Contents..................................................27
Section 1.11 Successors and Assigns....................................................................27
Section 1.12 Separability Clause.......................................................................27
Section 1.13 Benefits of Indenture.....................................................................28
Section 1.14 Governing Law.............................................................................28
Section 1.15 Legal Holidays............................................................................28
Section 1.16 Counterparts..............................................................................28
ARTICLE TWO SECURITY FORMS................................................................................28
Section 2.01 Forms Generally...........................................................................28
Section 2.02 Form of Trustee's Certificate of Authentication...........................................29
Section 2.03 Additional Provisions Required in Global Security.........................................29
ARTICLE THREE THE SECURITIES..............................................................................29
Section 3.01 Amount Unlimited; Issuable in Series......................................................29
Section 3.02 Denominations.............................................................................31
Section 3.03 Execution, Authentication, Delivery and Dating of Securities..............................32
Section 3.04 Temporary Securities......................................................................33
Section 3.05 Registration, Registration of Transfer and Exchange.......................................34
Section 3.06 Mutilated, Defaced, Destroyed, Lost and Stolen Securities.................................36
Section 3.07 Payment of Interest; Interest Rights Preserved............................................37
Section 3.08 Persons Deemed Owners.....................................................................39
Section 3.09 Cancellation..............................................................................39
Section 3.10 Computation of Interest...................................................................40
Section 3.11 Currency and Manner of Payments in Respect of Securities..................................40
Section 3.12 Appointment and Resignation of Successor Exchange Rate Agent..............................43
Section 3.13 Compliance with Certain Laws and Regulations..............................................43
Section 3.14 CUSIP Numbers.............................................................................43
ARTICLE FOUR SATISFACTION AND DISCHARGE...................................................................44
Section 4.01 Satisfaction and Discharge of Indenture...................................................44
Section 4.02 Application of Trust Money................................................................45
ARTICLE FIVE REMEDIES.....................................................................................45
Section 5.01 Events of Default.........................................................................45
Section 5.02 Acceleration of Maturity; Rescission and Annulment........................................46
Section 5.03 Collection of Indebtedness and Suits for Enforcement by Trustee...........................47
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Section 5.04 Trustee May File Proofs of Claim..........................................................48
Section 5.05 Trustee May Enforce Claims Without Possession of Securities...............................49
Section 5.06 Application of Moneys Collected by Trustee................................................49
Section 5.07 Limitation on Suits.......................................................................50
Section 5.08 Unconditional Right of Holders to Receive Principal, Premium and Interest.................50
Section 5.09 Restoration of Rights and Remedies........................................................51
Section 5.10 Rights and Remedies Cumulative............................................................51
Section 5.11 Delay or Omission Not Waiver..............................................................51
Section 5.12 Control by Holders........................................................................51
Section 5.13 Waiver of Past Defaults...................................................................52
Section 5.14 Undertaking for Costs.....................................................................52
Section 5.15 Waiver of Stay or Extension Laws..........................................................52
ARTICLE SIX THE TRUSTEE....................................................................................53
Section 6.01 Certain Duties and Responsibilities.......................................................53
Section 6.02 Notice of Defaults........................................................................54
Section 6.03 Certain Rights of the Trustee.............................................................54
Section 6.04 Not Responsible for Recitals or Issuance of Securities....................................55
Section 6.05 May Hold Securities.......................................................................55
Section 6.06 Money Held in Trust.......................................................................55
Section 6.07 Compensation and Reimbursement............................................................56
Section 6.08 Right to Rely on Officers' Certificate....................................................56
Section 6.09 Eligibility...............................................................................57
Section 6.10 Resignation and Removal; Appointment of Successor.........................................57
Section 6.11 Acceptance of Appointment by Successor....................................................58
Section 6.12 Merger, Conversion, Consolidation or Succession to Business...............................59
Section 6.13 Preferential Collection of Claims Against Company.........................................60
Section 6.14 Appointment of Authenticating Agent.......................................................60
ARTICLE SEVEN HOLDERS' LIST AND REPORTS BY TRUSTEE AND COMPANY.............................................61
Section 7.01 Company to Furnish Trustee Names and Addresses of Holders.................................61
Section 7.02 Preservation of Information; Communications to Holders....................................62
Section 7.03 Reports by Trustee........................................................................62
Section 7.04 Reports by Company........................................................................62
ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE.........................................63
Section 8.01 Company May Consolidate, Etc., Only on Certain Terms......................................63
Section 8.02 Successor Substituted.....................................................................64
ARTICLE NINE SUPPLEMENTAL INDENTURES.......................................................................64
Section 9.01 Supplemental Indentures Without Consent of Holders........................................64
Section 9.02 Supplemental Indentures with Consent of Holders...........................................65
Section 9.03 Execution of Supplemental Indentures......................................................66
Section 9.04 Effect of Supplemental Indentures.........................................................66
Section 9.05 Conformity with Trust Indenture Act.......................................................66
Section 9.06 Reference in Securities to Supplemental Indentures........................................67
ARTICLE TEN COVENANTS......................................................................................67
Section 10.01 Payment of Principal, Premium and Interest................................................67
Section 10.02 Maintenance of Office or Agency...........................................................67
Section 10.03 Money for Securities Payments to Be Held in Trust.........................................67
Section 10.04 Limitation on Indebtedness................................................................68
Section 10.05 Limitation on Indebtedness and Preferred Stock of Restricted Subsidiaries.................70
Section 10.06 Limitation on Restricted Payments.........................................................70
Section 10.07 Limitation on Restrictions on Distributions from Restricted Subsidiaries..................72
Section 10.08 Limitation on Sales of Assets and Subsidiary Stock........................................72
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Section 10.09 Limitation on Affiliate Transactions....................................................75
Section 10.10 Change of Control.......................................................................76
Section 10.11 Limitation on Liens.....................................................................76
Section 10.12 Limitation on Investment Company Status.................................................77
Section 10.13 SEC Reports.............................................................................77
Section 10.14 Certificate of Compliance...............................................................77
Section 10.15 Certain Covenants Suspended.............................................................77
Section 10.16 Calculation of Original Issue Discount..................................................78
ARTICLE ELEVEN REDEMPTION OF SECURITIES..................................................................78
Section 11.01 Applicability of Article................................................................78
Section 11.02 Election to Redeem; Notice to Trustee...................................................78
Section 11.03 Selection by Trustee of Securities to Be Redeemed.......................................78
Section 11.04 Notice of Redemption....................................................................79
Section 11.05 Deposit of Redemption Price.............................................................79
Section 11.06 Securities Payable on Redemption Date...................................................79
Section 11.07 Securities Redeemed in Part.............................................................80
ARTICLE TWELVE SINKING FUNDS.............................................................................80
Section 12.01 Applicability of Article................................................................80
Section 12.02 Satisfaction of Sinking Fund Payments with Securities...................................80
Section 12.03 Redemption of Securities for Sinking Fund...............................................81
ARTICLE THIRTEEN DEFEASANCE..............................................................................81
Section 13.01 Applicability of Article; Company's Option to Effect Defeasance or Covenant Defeasance..81
Section 13.02 Defeasance and Discharge................................................................81
Section 13.03 Covenant Defeasance.....................................................................82
Section 13.04 Conditions to Defeasance or Covenant Defeasance.........................................82
Section 13.05 Deposited Money and Government Obligations to Be Held in Trust; Other
Miscellaneous Provisions................................................................................84
Section 13.06 Reinstatement...........................................................................84
ARTICLE FOURTEEN SUBORDINATION...........................................................................85
Section 14.01 Agreement to Subordinate................................................................85
Section 14.02 Payments to Holders of Subordinated Securities..........................................85
Section 14.03 No Payment When Designated Senior Debt in Default.......................................86
Section 14.04 Subrogation.............................................................................87
Section 14.05 Authorization by Holders of Subordinated Securities.....................................88
Section 14.06 Notice to Trustee.......................................................................88
Section 14.07 Trustee's Relation to Senior Indebtedness...............................................89
Section 14.08 No Impairment of Subordination..........................................................89
Section 14.09 Trust Moneys Not Subordinated...........................................................90
ARTICLE FIFTEEN AMENDMENTS...............................................................................90
Section 15.01 Without Consent of Holders..............................................................90
Section 15.02 With Consent of Holders.................................................................91
Section 15.03 Compliance with Trust Indenture Act.....................................................92
Section 15.04 Effect of Consents......................................................................93
Section 15.05 Notation on or Exchange of Securities...................................................93
Section 15.06 Trustee Protected.......................................................................93
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RECITALS OF THE COMPANY
ContiFinancial Corporation, a Delaware corporation (the "Company") has
duly authorized the execution and delivery of this Indenture to provide for the
issuance from time to time of its unsecured debentures, notes or other evidences
of indebtedness (as such term is hereinafter defined) of the Company (such
debentures, notes or other evidences of indebtedness herein called the
"Securities") to be issued in one or more series as in this Indenture provided.
The Securities may either be senior (the "Senior Securities") or subordinated
(the "Subordinated Securities").
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 Securities by
the Holders thereof, it is agreed for the equal and proportionate benefit of all
Holders of the Securities of any series, as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 1.01 Definitions.
For all purposes of this Indenture and of any indenture supplemental
hereto, except as otherwise expressly provided or unless the context otherwise
requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) all other terms used herein which are defined in the Trust
Indenture Act or by Commission rule under the Trust Indenture Act, either
directly or by reference therein, have the meanings assigned to them therein;
(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP;
(d) 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;
(e) "or" is not exclusive;
(f) "including" means including without limitation;
(g) unsecured Indebtedness shall not be deemed to be subordinate or
junior to Secured Indebtedness merely by virtue of its nature as unsecured
Indebtedness;
(h) the principal amount of any noninterest bearing or other discount
security at any date shall be the principal amount thereof that would be shown
on a balance sheet of the issuer dated such date prepared in accordance with
GAAP; and
(i) the principal amount of any Preferred Stock shall be (i) the
maximum liquidation value of such Preferred Stock or (ii) the maximum mandatory
redemption or mandatory repurchase price with respect to such Preferred Stock,
whichever is greater.
"Additional Assets" means (i) any property or assets (other than
Indebtedness and Capital Stock) used or useful in a Related Business, (ii) the
Capital Stock of a Person that becomes a Restricted Subsidiary as a result of
the acquisition of such Capital Stock by the Company or another Restricted
Subsidiary, (iii) Capital Stock constituting a minority interest in any Person
that at such time is a Restricted Subsidiary; provided, however, that any such
Restricted Subsidiary described in clause (ii) or (iii) above is primarily
engaged in a Related Business or (iv) the Capital Stock or Indebtedness of a
Strategic Alliance Client.
"Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Sections 10.08 and 10.09 only, "Affiliate" shall also mean any
beneficial owner of Capital Stock representing 5% or more of the total voting
power of the Voting Stock (on a fully diluted basis) of the Company or of rights
or warrants to purchase such Capital Stock (whether or not currently
exercisable) and any Person who would be an Affiliate of any such beneficial
owner pursuant to the first sentence hereof.
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Company or any Restricted Subsidiary, including any disposition by means of
a merger, consolidation or similar transaction (each referred to for the
purposes of this definition as a "disposition"), of (i) any shares of Capital
Stock of a Restricted Subsidiary (other than directors' qualifying shares or
shares required by applicable law to be held by a Person other than the Company
or a Restricted Subsidiary), (ii) all or substantially all the assets of any
division or line of business of the Company or any Restricted Subsidiary, (iii)
any other assets of the Company or any Restricted Subsidiary outside of the
ordinary course of business of the Company or such Restricted Subsidiary, (iv)
any Investment in a Strategic Alliance Client or (v) any Excess Spread
Receivables (other than, in the case of (i), (ii), (iii), (iv) and (v) above,
(x) a disposition by a Restricted Subsidiary to the Company or by the Company or
a Restricted Subsidiary to a Consolidated Restricted Subsidiary, (y) for
purposes of Section 10.08 only, a disposition that constitutes a Restricted
Payment permitted by Section 10.06 or (z) a disposition of assets (including
related assets) for an aggregate consideration of $1.0 million or less).
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Authorized Newspaper" means a newspaper of general circulation, in
the official language of the country of publication or in the English language,
customarily published on each Business Day whether or not published on
Saturdays, Sundays or holidays. Whenever successive publications in an
Authorized Newspaper are required hereunder they may be made
2
(unless otherwise expressly provided herein) on the same or different days of
the week and in the same or different Authorized Newspapers.
"Average Life" means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing (i) the
sum of the products of numbers of years from the date of determination to the
dates of each successive scheduled principal payment of such Indebtedness or
redemption or similar payment with respect to such Preferred Stock multiplied by
the amount of such payment by (ii) the sum of all such payments.
"Bearer Security" means any Security issued under this Indenture which
is payable to bearer.
"Board of Directors" means the Board of Directors of the Company or
any committee thereof duly authorized to act on behalf of such 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 day which is not a Legal Holiday.
"Capital Lease Obligations" means an obligation that is required to be
classified and accounted for as a capital lease for financial reporting purposes
in accordance with GAAP, and the amount of Indebtedness represented by such
obligation shall be the capitalized amount of such obligation determined in
accordance with GAAP; and the Stated Maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of a
penalty.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests or membership interests in (however designated) equity of such Person,
including any Preferred Stock, but excluding any debt securities convertible
into such equity.
"Change of Control" means the occurrence of any of the following
events:
(i) Any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act), other than the Permitted Holders, who is or becomes the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act, except that such person shall be deemed to have "beneficial ownership"
of all shares that any such person has the right to acquire, whether such
right is exercisable immediately or only after the passage of time),
directly or indirectly, of more than 35% of the total voting power of the
Voting Stock of the Company; provided, however, that the Permitted Holders
beneficially own (as defined in Rule 13d-3 and Rule 13d-5 under the
Exchange Act), directly or indirectly, in the aggregate a lesser percentage
of the total voting power of the Voting Stock of the Company than such
other person and do not have the right or ability by voting power, contract
or otherwise to elect or designate for election a majority of the Board of
Directors (for the purposes of this clause (i), such other person shall be
deemed to beneficially own any Voting Stock of a corporation held by
another corporation (a "parent corporation"), if such other person is the
beneficial owner (as defined above for such person), directly or
indirectly, of more than 35% of the voting power of the Voting Stock of
such parent corporation and the Permitted Holders beneficially own (as
defined
3
above for the Permitted Holders), directly or indirectly, in the
aggregate a lesser percentage of the voting power of the Voting Stock of
such parent corporation and do not have the right or ability by voting
power, contract or otherwise to elect or designate for election a majority
of the board of directors of such parent corporation);
(ii) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of Directors (together
with any new directors whose election by such Board of Directors or whose
nomination for election by the shareholders of the Company was approved by
a vote of 66-2/3% of the directors of the Company then still in office who
were either directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors then in office; or
(iii) the merger or consolidation of the Company with or into another
Person or the merger of another Person with or into the Company, or the
sale of all or substantially all the assets of the Company to another
Person (other than a Person that is controlled by the Permitted Holders),
and, in the case of any such merger or consolidation, the securities of the
Company that are outstanding immediately prior to such transaction and
which represent 100% of the aggregate voting power of the Voting Stock of
the Company are changed into or exchanged for cash, securities or property,
unless pursuant to such transaction such securities are changed into or
exchanged for, in addition to any other consideration, securities of the
surviving corporation that represent immediately after such transaction, at
least a majority of the aggregate voting power of the Voting Stock of the
surviving corporation; provided, however, that the sale by the Company or
its Restricted Subsidiaries from time to time of Receivables to a trust for
the purpose solely of effecting one or more securitizations shall not be
treated hereunder as a sale of all or substantially all the assets of the
Company.
"Closing Price Per Share" means, with respect to the Capital Stock of
the Company, for any day the last reported sales price per share (i) on the New
York Stock Exchange, Inc. as reported in the Wall Street Journal (or other
similar newspaper) for New York Stock Exchange Composite Transactions (or, if no
such sale is so reported on such day, the average of such reported closing bid
and asked prices regular way) or, if the Capital Stock is not listed or admitted
to trading on such Exchange, on the principal (as determined by the Company's
Board of Directors) national securities exchange on which the Capital Stock is
listed or admitted to trading or, (ii) if not listed or admitted to trading on
any national securities exchange, on the National Association of Securities
Dealers Automated Quotations National Market System; or if the Capital Stock is
not listed or admitted to trading on any national securities exchange or quoted
on such National Market System, the average of the closing bid and asked prices
in the over-the-counter market as furnished by any New York Stock Exchange
member firm selected from time to time by the Company for that purpose.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, as
amended, or, if at any time after the execution of this Indenture such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act, then the body performing such duties on such date.
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"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Order" and "Company Request" mean, respectively, a written
order or request signed in the name of the Company by both (i) its Chairman of
the Board of Directors, its Vice Chairman of the Board of Directors, its
President or a Vice President, and (ii) its Treasurer, an Assistant Treasurer,
its Controller, an Assistant Controller, its Secretary or an Assistant
Secretary, and delivered to the Trustee.
"Consolidated Current Liabilities" as of the date of determination
means the aggregate amount of liabilities of the Company and its consolidated
Restricted Subsidiaries which may properly be classified as current liabilities
(including taxes accrued as estimated), on a consolidated basis, after
eliminating (i) all intercompany items between the Company and any Restricted
Subsidiary and (ii) all current maturities of long-term Indebtedness, all as
determined in accordance with GAAP consistently applied.
"Consolidated Leverage Ratio" as of any date of determination means
the ratio of (i) the aggregate amount of all Indebtedness of the Company and its
Restricted Subsidiaries on a consolidated basis, excluding (A) Permitted
Warehouse Indebtedness and (B) Hedging Obligations permitted to be Incurred
pursuant to Section 10.04(b)(6), to (ii) the Consolidated Net Worth of the
Company.
"Consolidated Net Income" means, for any period, the net income of the
Company and its consolidated Subsidiaries; provided, however, that there shall
not be included in such Consolidated Net Income: (i) any net income of any
Person if such Person is not a Restricted Subsidiary, except that (A) subject to
the exclusion contained in clause (iv) below, the Company's equity in the net
income of any such Person for such period shall be included in such Consolidated
Net Income up to the aggregate amount of cash actually distributed by such
Person during such period to the Company or a Restricted Subsidiary as a
dividend or other distribution (subject, in the case of a dividend or other
distribution paid to a Restricted Subsidiary, to the limitations contained in
clause (iii) below) and (B) the Company's equity in a net loss of any such
Person for such period shall be included in determining such Consolidated Net
Income; (ii) any net income (or loss) of any Person acquired by the Company or a
Subsidiary in a pooling of interests transaction for any period prior to the
date of such acquisition; (iii) any net income of any Restricted Subsidiary if
such Restricted Subsidiary is subject to restrictions, directly or indirectly,
on the payment of dividends or the making of distributions by such Restricted
Subsidiary, directly or indirectly, to the Company, except that (A) subject to
the exclusion contained in clause (iv) below, the Company's equity in the net
income of any such Restricted Subsidiary for such period shall be included in
such Consolidated Net Income to the extent that cash could have been distributed
by such Restricted Subsidiary during such period to the Company or another
Restricted Subsidiary as a dividend or other distribution (subject, in the case
of a dividend or other distribution paid to another Restricted Subsidiary, to
the limitation contained in this clause) and (B) the Company's equity in a net
loss of any such Restricted Subsidiary for such period shall be included in
determining such Consolidated Net Income; (iv) any gain (but not loss) realized
upon the sale or other disposition of any asset (excluding any equity Investment
in a Strategic Alliance Client) of the Company or its consolidated Subsidiaries
(including pursuant to any sale-and-leaseback arrangement) which is not sold or
otherwise disposed of in the ordinary course of business and any gain (but not
loss) realized upon the sale or other disposition of any Capital Stock of any
Person (excluding Capital Stock in a Strategic Alliance Client); (v)
extraordinary gains or losses; and (vi) the cumulative effect of a change in
5
accounting principles. Notwithstanding the foregoing, for the purposes of
Section 10.06 only, there shall be excluded from Consolidated Net Income any
dividends, repayments of loans or advances or other transfers of assets from any
Person to the Company or a Restricted Subsidiary to the extent such dividends,
repayments or transfers increase the amount of Restricted Payments permitted
under Section 10.06(a)(iii)(D).
"Consolidated Net Tangible Assets" as of any date of determination,
means the total amount of assets (less accumulated depreciation and
amortization, allowances for doubtful receivables, other applicable reserves and
other properly deductible items) which would appear on a balance sheet of the
Company and its Restricted Subsidiaries, determined on a consolidated basis in
accordance with GAAP, and after giving effect to purchase accounting and after
deducting therefrom all Consolidated Current Liabilities and, to the extent
otherwise included, the amounts of: (i) minority interests in consolidated
Subsidiaries held by Persons other than the Company or a Restricted Subsidiary;
(ii) excess of cost over fair value of assets of businesses acquired, as
determined in good faith by the Board of Directors; (iii) any revaluation or
other write-up in book value of assets (other than Excess Spread Receivables)
subsequent to the Issue Date as a result of a change in the method of valuation
in accordance with GAAP consistently applied; (iv) unamortized debt discount and
expenses and other unamortized deferred charges, goodwill, patents, trademarks,
service marks, trade names, copyrights, licenses, organization or developmental
expenses and other intangible items; (v) treasury stock; (vi) cash set apart and
held in a sinking or other analogous fund established for the purpose of
redemption or other retirement of Capital Stock to the extent such obligation is
not reflected in Consolidated Current Liabilities; and (vii) Investments in and
assets of Unrestricted Subsidiaries.
"Consolidated Net Worth" means the total of the amounts shown on the
balance sheet of the Company and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP, as of the end of the most recent
fiscal quarter of the Company for which financial statements are available, as
(i) the par or stated value of all outstanding Capital Stock of the Company plus
(ii) paid-in capital or capital surplus relating to such Capital Stock plus
(iii) any retained earnings or earned surplus less (A) any accumulated deficit,
(B) any amounts attributable to Disqualified Stock and (C) any amounts
attributable to deferred compensation appropriately classified as net worth in
accordance with GAAP.
"Consolidated Restricted Subsidiary" means a Restricted Subsidiary (i)
80% of the Capital Stock and 80% of the Voting Stock of which is owned by the
Company or one or more Consolidated Restricted Subsidiaries and (ii) which is
treated as a consolidated subsidiary for the purpose of the Company's U.S.
Federal income tax reporting.
"Continental Grain" means Continental Grain Company, a Delaware
corporation, and its successors.
"Conversion Event" means the cessation of use of (a) a Foreign
Currency both by the government of the country which issued such Currency and by
a central bank or other public institutions of or within the international
banking community for the settlement of transactions, (b) the ECU both within
the European Monetary System and for the settlement of transactions by public
institutions of or within the European Communities or (c) any currency unit (or
composite currency) other than the ECU for the purposes for which it was
established.
"Corporate Trust Office" means the office of the Trustee specified in
Section 1.06 hereof or such other address as to which the Trustee may give
notice to the Company.
6
"Corporation" includes corporations, associations, companies, joint-
stock companies, limited liability companies and business trusts.
"Coupon" means any interest coupon appertaining to a Bearer Security.
"Credit Agreements" means (a) the $200,000,000 Revolving Credit
Facility, dated as of January 7, 1997, among the Company as Borrower, the
lenders party thereto, Credit Suisse First Boston, New York Branch, as
Administrative Agent and Co-Arranger, and Dresdner Bank AG, New York and Grand
Cayman Branches, as Co-Arrangers, together with the related documents thereto,
in each case as such agreements may be amended, supplemented or otherwise
modified from time to time, including any agreement extending the maturity of,
refinancing, replacing, substituting, renewing or otherwise restructuring all or
a portion of the Indebtedness under such agreement or any successor or
replacement agreement and (b) the $275,000,000 Letter of Credit and
Reimbursement Agreement, dated as of September 9, 1997, among the Company, as
Borrower, the participating banks party thereto, Credit Suisse First Boston, New
York Branch, as Agent and Co-Arranger, and Dresdner Bank AG, New York Branch, as
Issuing Bank and Co-Arranger.
"Currency" means any currency or currencies, currency unit or units or
composite currency or currencies, including, the ECU, issued by the government
of one or more countries or by any recognized confederation or association of
such governments.
"Currency Agreement" means in respect of a Person any foreign exchange
contract, currency swap agreement or other similar agreement to which such
Person is a party or a beneficiary.
"Debt" means any notes, bonds, debentures or other similar evidences
of indebtedness for money borrowed.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Depositary" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more Global
Securities, the Person designated as Depositary by the Company pursuant to
Section 3.01 until a successor Depositary shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Depositary" shall mean
or include each Person who is then a Depositary hereunder, and if at any time
there is more than one such Person, "Depositary" as used with respect to the
Securities of any such series shall mean the Depositary with respect to the
Securities of that series.
"Designated Senior Debt" means (a) any Indebtedness of the Company
under the Credit Agreements and (b) any other Senior Indebtedness of the Company
having, at the time of determination, an aggregate principal amount of at least
$25,000,000 and specifically designated in the instrument evidencing such Senior
Indebtedness as "Designated Senior Debt" by the Company.
"Disqualified Stock" means, with respect to any Person and any series
of Securities, any Capital Stock which by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable) or upon
the happening of any event (i) matures or is mandatorily redeemable pursuant to
a sinking fund obligation or otherwise, (ii) is convertible or exchangeable for
Indebtedness or Disqualified Stock or (iii) is redeemable at the option of the
7
holder thereof, in each case in whole or in part on or prior to the first
anniversary of the Stated Maturity of the Securities of such series; provided,
however, that any Capital Stock that would not constitute Disqualified Stock but
for provisions thereof giving holders thereof the right to require such Person
to repurchase or redeem such Capital Stock upon the occurrence of an "asset
sale" or "change of control" occurring prior to the first anniversary of the
Stated Maturity of the Securities of such series shall not constitute
Disqualified Stock if the "asset sale" or "change of control" provisions
applicable to such Capital Stock are not more favorable as determined in good
faith by the Board of Directors to the holders of such Capital Stock than the
provisions in Sections 10.08 and 10.10.
"Dollar" or "U.S. Dollar" or "$" means a dollar or other equivalent
unit in such coin or currency of the United States of America as at the time
shall be legal tender for the payment of public and private debts.
"ECU" means the European Currency Unit as defined and revised from
time to time by the Council of the European Communities.
"Eligible Excess Spread Receivables" means Excess Spread Receivables
created after April 2, 1996; provided, however, that Eligible Excess Spread
Receivables shall not include any Excess Spread Receivables created as the
result of the securitization or sale of Excess Spread Receivables.
"Euroclear" means Xxxxxx Guaranty Trust Company of New York, Brussels
Office, or its successor as operator of the Euroclear System.
"European Communities" means the European Economic Community, the
European Coal and Steel Community and the European Atomic Energy Community.
"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of the European
Communities.
"Event of Default" has the meaning specified in Section 5.01.
"Excess Spread" means, over the life of a "pool" of Receivables that
have been sold by a Person to a trust or other Person in a securitization or
sale, the rights retained by such Person or its Restricted Subsidiaries at or
subsequent to the closing of such securitization or sale to receive cash flows
attributable to such "pool."
"Excess Spread Receivables" of a Person means the contractual or
certificated right to Excess Spread capitalized on such Person's consolidated
balance sheet (the amount of which shall be the present value of the Excess
Spread, calculated in accordance with GAAP).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Rate Agent" , with respect to Securities of or within any
series, means, unless otherwise specified with respect to any Securities
pursuant to Section 3.01, a New York Clearing House bank, designated pursuant to
Section 3.01 or Section 3.12.
"Exchange Rate Officer's Certificate" means a tested telex or a
certificate setting forth (a) the applicable Market Exchange Rate and (b) the
Dollar or Foreign Currency amounts of principal (and premium, if any) and
interest, if any (on an aggregate basis and on the basis of a
8
Security having the lowest denomination principal amount determined in
accordance with Section 3.02 in the relevant Currency), payable with respect to
a Security of any series on the basis of such Market Exchange Rate, sent (in the
case of a telex) or signed (in the case of a certificate) by the Treasurer, any
Vice President or any Assistant Treasurer of the Company.
"Foreign Currency" means any Currency other than the U.S. Dollar.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Issue Date, including those set forth
(i) in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (ii) in the statements and
pronouncements of the Financial Accounting Standards Board, (iii) in such other
statements by such other entity as approved by a significant segment of the
accounting profession, and (iv) in the rules and regulations of the SEC
governing the inclusion of financial statements (including pro forma financial
statements) in periodic reports required to be filed pursuant to Section 13 of
the Exchange Act, including opinions and pronouncements in staff accounting
bulletins and similar written statements from the accounting staff of the SEC
and releases of the Emerging Issues Task Force.
"Global Security" means a Security bearing the legend prescribed in
Section 2.03 evidencing all or part of a series of Securities, issued to the
Depositary for such series or its nominee, and registered in the name of such
Depositary or nominee.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any Person and any obligation, direct or indirect, contingent or otherwise,
of such Person (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other obligation of such Person
(whether arising by virtue of partnership arrangements, or by agreements to
keep-well, to purchase assets, goods, securities or services, to take-or-pay or
to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the obligee of such Indebtedness
or other obligation of the payment thereof or to protect such obligee against
loss in respect thereof (in whole or in part); provided, however, that the term
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business. "Guarantee" used as a verb has a corresponding
meaning.
"Guarantor" shall mean any Person Guaranteeing any obligation.
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement, Currency Agreement or such other
agreement designed to mitigate risks of fluctuations in value of assets owned,
financed or sold, or of liabilities incurred or assumed, in either case in the
ordinary course of business of the Company or its Restricted Subsidiaries.
"Holder" means, with respect to a Registered Security, a Person in
whose name a Security is registered in the Security Register and, with respect
to a Bearer Security, a bearer thereof or of a Coupon appertaining thereto.
"Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness of a Person existing at the
time such Person becomes a Subsidiary (whether by merger, consolidation,
acquisition or otherwise) shall be deemed to be Incurred by such Subsidiary at
the time it becomes a Subsidiary. The term "Incurrence" when
9
used as a noun shall have a correlative meaning. The accretion of principal of a
non-interest bearing or other discount security shall be deemed the Incurrence
of Indebtedness.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication), (i) the outstanding principal as of such
date in respect of (A) indebtedness of such Person for money borrowed and (B)
indebtedness evidenced by notes, debentures, bonds or other similar instruments
for the payment of which such Person is responsible or liable, including, in
each case, any premium on such indebtedness to the extent such premium has
become due and payable; (ii) all Capital Lease Obligations of such Person; (iii)
all obligations of such Person issued or assumed as the deferred purchase price
of property, all conditional sale obligations of such Person and all obligations
of such Person under any title retention agreement (but excluding trade accounts
payable and expense accruals arising in the ordinary course of business); (iv)
all obligations of such Person for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction (other than
obligations with respect to letters of credit securing obligations (other than
obligations described in (i) through (iii) above) entered into in the ordinary
course of business of such Person to the extent such letters of credit are not
drawn upon or, if and to the extent drawn upon, such drawing is reimbursed no
later than the tenth Business Day following receipt by such Person of a demand
for reimbursement following payment on the letter of credit); (v) the amount of
all obligations of such Person with respect to the redemption, repayment or
other repurchase of any Disqualified Stock (but excluding any accrued
dividends); (vi) Warehouse Indebtedness; (vii) in connection with each sale by
such Person of any Excess Spread Receivables, the maximum aggregate contractual
claim (if any) that the purchaser thereof could have against such Person if the
amounts anticipated at the time of such sale to be received by such purchaser in
connection with such Excess Spread Receivables are not received by such
purchaser; (viii) all obligations of the type referred to in clauses (i) through
(vii) of other Persons and all dividends of other Persons for the payment of
which, in either case, such Person is responsible or liable, directly or
indirectly, as obligor, guarantor or otherwise, including by means of any
Guarantee; (ix) all obligations of the type referred to in clauses (i) through
(viii) of other Persons secured by any Lien on any property or asset of such
Person (whether or not such obligation is assumed by such Person), the amount of
such obligation being deemed to be the lesser of the value of such property or
assets or the amount of the obligation so secured and (x) to the extent not
otherwise included in this definition, Hedging Obligations of such Person. The
amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and the
maximum liability, upon the occurrence of the contingency giving rise to the
obligation, of any contingent obligations at such date. Notwithstanding the
foregoing, any securities issued in a securitization by a special purpose owner
trust or similar entity formed by or on behalf of a Person and to which
Receivables or Excess Spread Receivables have been sold or otherwise transferred
by or on behalf of such Person or its Subsidiaries shall not be treated as
Indebtedness of such Person or its Subsidiaries under this Indenture, regardless
of whether such securities are treated as indebtedness for tax purposes and
regardless of whether such securities are styled as debt.
"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 mandatory provisions of the Trust Indenture Act that are deemed
to be a part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated in Section 3.01.
10
"Interest" means, when used with respect to a non-interest bearing
Security, interest payable after the principal thereof has become due and
payable whether at Maturity, by declaration of acceleration, by call for
redemption, pursuant to a sinking fund or otherwise, and, when used with respect
to an Original Issue Discount Security which by its terms bears interest only
after Maturity, interest payable after Maturity.
"Interest Payment Date" , when used with respect to any Security,
means the Stated Maturity of an installment of interest on such Security.
"Interest Rate Agreement" means any interest rate swap agreement,
interest rate cap agreement, repurchase agreement, futures contract or other
financial agreement or arrangement designed to protect the Company or any
Restricted Subsidiary against fluctuations in interest rates.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as trade accounts on the balance sheet of the lender) or other
extensions of credit (including by way of Guarantee or similar arrangement) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, Indebtedness or other
similar instruments issued by such Person. For purposes of the definition of
"Unrestricted Subsidiary", the definition of "Restricted Payment" and Section
10.06, (i) "Investment" shall include the portion (proportionate to the
Company's equity interest in such Subsidiary) of the fair market value of the
net assets of any Subsidiary of the Company at the time that such Subsidiary is
designated an Unrestricted Subsidiary; provided, however, that upon a
redesignation of such Subsidiary as a Restricted Subsidiary, the Company shall
be deemed to continue to have a permanent "Investment" in an Unrestricted
Subsidiary equal to an amount (if positive) equal to (x) the Company's
"Investment" in such Subsidiary at the time of such redesignation less (y) the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the fair market value of the net assets of such Subsidiary at the time of such
redesignation; and (ii) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer, in each case as determined in good faith by the Board of Directors.
"Investment Grade Rating" means a rating equal to or higher than Baa3
(or the equivalent) and BBB- (or the equivalent) by Xxxxx'x Investors Service,
Inc. (or any successor to the rating agency business thereof) and Standard &
Poor's Ratings Group (or any successor to the rating agency business thereof),
respectively.
"Issue Date" means, with respect to any series of Securities, the date
of issuance of such series of Securities.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions are not required to be open in the State of New York. If a payment
date is a Legal Holiday, payment shall be made on the next succeeding day that
is not a Legal Holiday, and no interest shall accrue for the intervening period.
If a regular record date is a Legal Holiday, the record date shall not be
affected.
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).
11
"Market Exchange Rate" means, unless otherwise specified with respect
to the Securities of a series pursuant to Section 3.01, (a) for any conversion
involving a currency unit on the one hand and Dollars or any Foreign Currency on
the other, the exchange rate between the relevant currency unit and Dollars or
such Foreign Currency calculated by the method specified pursuant to Section
3.01 for the Securities of such series, (b) for any conversion of Dollars into
any Foreign Currency, the noon (New York City time) buying rate for such Foreign
Currency for cable transfers quoted in New York City as certified for customs
purposes by the Federal Reserve Bank of New York and (c) for any conversion of
one Foreign Currency into Dollars or another Foreign Currency, the spot rate at
noon local time in the relevant market at which in accordance with normal
banking procedures, the Dollars or Foreign Currency into which conversion is
being made could be purchased with the Foreign Currency from which conversion is
being made from major banks located in either New York City, London or any other
principal market for Dollars or such purchased Foreign Currency, in each case
determined by the Exchange Rate Agent. Unless otherwise specified with respect
to the Securities of a series pursuant to Section 3.01, in the event of the
unavailability of any of the exchange rates provided for in the foregoing
clauses (a), (b) and (c), the Exchange Rate Agent shall use, in its sole
discretion and without liability on its part, such quotation of the Federal
Reserve Bank of New York as of the most recent available date, or quotations
from one or more major banks in New York City, London or any other principal
market for such Currency in question, or such other quotations as the Exchange
Rate Agent shall deem appropriate.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an installment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption, pursuant to a sinking fund or
otherwise.
"Net Available Cash" from an Asset Disposition means cash payments
received therefrom (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise,
but only as and when received, but excluding any other consideration received in
the form of assumption by the acquiring Person of Indebtedness or other
obligations relating to such properties or assets or received in any other
noncash form) in each case net of (i) all legal, title and recording tax
expenses, commissions and other fees and expenses incurred, and all Federal,
state, provincial, foreign and local taxes required to be accrued as a liability
under GAAP, as a consequence of such Asset Disposition, (ii) all payments made
on any Indebtedness which is secured by any assets subject to such Asset
Disposition, in accordance with the terms of any Lien upon or other security
agreement of any kind with respect to such assets, or which must by its terms,
or in order to obtain a necessary consent to such Asset Disposition, or by
applicable law be, repaid out of the proceeds from such Asset Disposition, (iii)
all distributions and other payments required to be made to minority interest
holders in Subsidiaries or joint ventures as a result of such Asset Disposition
and (iv) the deduction of appropriate amounts provided by the seller as a
reserve, in accordance with GAAP, against any liabilities associated with the
property or other assets disposed in such Asset Disposition and retained by the
Company or any Restricted Subsidiary after such Asset Disposition.
"Net Cash Proceeds", with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees actually incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.
12
"NYSE" means the New York Stock Exchange, Inc.
"Officer" means the Chairman of the Board, the President, any Senior
Vice President, any Vice President, the Treasurer or the Secretary of the
Company.
"Officers' Certificate" means a certificate signed by both (a) the
Chairman of the Board of Directors, a Vice Chairman of the Board of Directors,
the President or a Vice President and (b) the Treasurer, an Assistant Treasurer,
the Secretary or an Assistant Secretary of the Company, and delivered to the
Trustee. Each such Officers' Certificate shall include the statements required
by Section 1.03 hereunder.
"Opinion of Counsel" means a written opinion of counsel who shall be
acceptable to the Trustee, who may be an employee of or counsel for the Company,
and which opinion complies with the requirements of Section 1.03.
"Original Issue Discount Security" means any Security which provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the Maturity thereof pursuant to Section 5.02.
"Outstanding", when used with respect to Securities of any series,
means, except as otherwise required by the Trust Indenture Act as of the date of
determination, all Securities of such series theretofore authenticated and
delivered under this Indenture, except:
(a) Securities of such series theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(b) Securities of such series, or portions thereof, 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 Securities and of any Coupons pertaining
to such Securities; provided, however, that, if such Securities 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; and
(c) Securities of such series which have been paid pursuant to Section
3.07 or in exchange for or in lieu of which other Securities of such series have
been authenticated and delivered pursuant to this Indenture, other than any such
Securities in respect of which there shall have been presented to the Trustee
proof satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company; provided,
however, that in determining whether the Holders of the requisite principal
amount of the Outstanding Securities of any series have taken any action
(including the making of any request, demand, authorization or direction), the
giving of any notice, consent or waiver (or the taking of any other action)
hereunder and in determining voting rights of any Holder of a Security hereunder
(i) the principal amount of Original Issue Discount Securities that shall be
deemed to be Outstanding for such purposes shall be the amount of the principal
thereof that would be due and payable as of the date of such determination upon
a declaration of acceleration of the Maturity thereof pursuant to Section 5.02,
(ii) the principal amount of any Security of such series, the principal amount
of which is denominated in a Specified Currency, shall be deemed to be that
amount as determined in accordance with Section 3.11 (or, in the case of any
Original Issue Discount Security, the amount determined in accordance with
clause (i) above as well as Section 3.11), and (iii) Securities of such series
owned by the Company or any other obligor upon such
13
Securities or any Affiliate of the Company or of such other obligor 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 Securities of such
series which a Responsible Officer of the Trustee actually knows to be so owned
shall be so disregarded. Securities 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
Securities and that the pledgee is not the Company or any other obligor upon
such Securities or any Affiliate of the Company or any such other obligor. In
case of a dispute as to such right, the advice of counsel shall be full
protection in respect of any decision made by the Trustee in accordance with
such advice.
"Overdue Rate" means, unless otherwise specified in the Securities of
any series, the same rate as the rate of interest specified in the Securities of
such series or, in the case of a series of Original Issue Discount Securities,
the Yield to Maturity of such series of Securities.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Permitted Holders" means lineal descendants of Xxxxx Xxxxxxxx,
including any individual legally adopted; spouses of such descendants; trusts,
the beneficiaries of which are any of the foregoing; partnerships, corporations,
or other entities in which any of the foregoing (individually or collectively)
has a controlling interest; and charitable organizations established by any of
the foregoing.
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in (i) the Company, a Restricted Subsidiary or a Person
that will, upon the making of such Investment, become a Restricted Subsidiary;
provided, however, that the primary business of such Restricted Subsidiary is a
Related Business; (ii) a Strategic Alliance Client to the extent such Investment
consists of options, warrants or other securities that are convertible or
exchangeable for equity securities of such Strategic Alliance Client and is
received by the Company or a Restricted Subsidiary without the payment of any
consideration other than the concurrent provision by the Company or such
Restricted Subsidiary to such Strategic Alliance Client of financing or asset
securitization expertise on terms determined by the Company to be fair and
reasonable to the Company or such Restricted Subsidiary from a financial point
of view without taking into consideration any value that may inhere in such
option, warrant or convertible or exchangeable security; (iii) another Person if
as a result of such Investment such other Person is merged or consolidated with
or into, or transfers or conveys all or substantially all its assets to, the
Company or a Restricted Subsidiary; provided, however, that such Person's
primary business is a Related Business; (iv) Temporary Cash Investments; (v)
receivables owing to the Company or any Restricted Subsidiary if created or
acquired in the ordinary course of business and payable or dischargeable in
accordance with customary trade terms; (vi) payroll, travel and similar advances
to cover matters that are expected at the time of such advances ultimately to be
treated as expenses for accounting purposes and that are made in the ordinary
course of business; (vii) loans or advances to employees made in the ordinary
course of business consistent with past practices of the Company or such
Restricted Subsidiary; (viii) stock, obligations or securities received in
settlement of debts created in the ordinary course of business and owing to the
Company or any Restricted Subsidiary or in satisfaction of judgments; (ix) any
Person to the extent such Investment represents the non-cash portion of the
consideration received for an Asset Disposition as permitted pursuant to Section
10.08; (x) Receivables; (xi) a Strategic Alliance Client to the extent such
Investment consists of (A) Indebtedness of such Strategic Alliance Client that
is secured by Receivables owned, directly or indirectly, by such Strategic
Alliance
14
Client in an aggregate principal amount at any time outstanding not to exceed
100% of the aggregate market value of such Receivables; provided, however, that
such Indebtedness has not been outstanding in excess of 364 days; or (B)
Indebtedness of such Strategic Alliance Client that is secured by Excess Spread
Receivables owned by such Strategic Alliance Client; and (xii) Excess Spread
Receivables.
"Permitted Liens" means, with respect to any Person:
(a) pledges or deposits by such Person under worker's compensation
laws, unemployment insurance laws or similar legislation, or good faith deposits
in connection with bids, tenders, contracts (other than for the payment of
Indebtedness) or leases to which such Person is a party, or deposits to secure
public or statutory obligations of such Person or pledges or deposits to secure
surety or appeal bonds to which such Person is a party, or pledges or deposits
as security for contested taxes or import duties or for the payment of rent, in
each case Incurred in the ordinary course of business;
(b) Liens imposed by law, such as carriers', warehousemen's and
mechanics' Liens, in each case for sums not yet due or being contested in good
faith by appropriate proceedings or other Liens arising out of judgments or
awards against such Person with respect to which such Person shall then be
proceeding with an appeal or other proceedings for review;
(c) Liens for property taxes not yet subject to penalties for non-
payment or which are being contested in good faith and by appropriate
proceedings;
(d) Liens in favor of issuers of surety bonds or letters of credit
issued pursuant to the request of and for the account of such Person in the
ordinary course of its business; provided, however, that any reimbursement
obligation with respect to the related letter of credit does not constitute
Indebtedness as of the date such Lien is incurred;
(e) minor survey exceptions, minor encumbrances, easements or
reservations of, or rights of others for, licenses, rights of way, sewers,
electric lines, telegraph and telephone lines and other similar purposes, or
zoning or other restrictions as to the use of real property or Liens incidental
to the conduct of the business of such Person or to the ownership of its
properties which were not Incurred in connection with Indebtedness and which do
not in the aggregate materially adversely affect the value of said properties or
materially impair their use in the operation of the business of such Person;
(f) Liens securing Indebtedness Incurred to finance the construction,
purchase or lease of, or repairs, improvements or additions to, property of such
Person (but excluding Capital Stock of another Person); provided, however, that
the Lien may not extend to any other property owned by such Person or any of its
Subsidiaries at the time the Lien is Incurred, and the Indebtedness secured by
the Lien may not be Incurred more than one year after the later of the
acquisition, completion of construction, repair, improvement, addition or
commencement of full operation of the property subject to the Lien;
(g) Liens on Excess Spread Receivables (or on the Capital Stock of any
Subsidiary of such Person substantially all the assets of which are Excess
Spread Receivables); provided, however, that
(I) unless the Covenant Termination has occurred,
15
(A) in the case of Excess Spread Receivables which are Pre-
Existing Excess Spread Receivables, no Lien created on such Pre-
Existing Excess Spread Receivable after the Issue Date of a series of
Securities (a "Subsequent Lien") shall be a Permitted Lien unless
(i) such Pre-Existing Excess Spread Receivable was, on April
2, 1996, subject to a Lien created by the Company in respect of
the financing thereof (a "predecessor Lien"), and
(ii) the sum of (x) the aggregate book value of subordinated
interests created and retained by the Company or its Restricted
Subsidiaries as a result of the sale or financing associated with
such Subsequent Liens and (y) the aggregate book value of all
Pre-Existing Excess Spread Receivables which are not then subject
to any Lien (other than Permitted Liens described under another
clause of this definition) shall equal at least (z) the product
of (1) the aggregate book value, at the date of incurrence of
such Subsequent Lien, of all such Pre-Existing Excess Spread
Receivables which are then subject to subsequent Liens, and (2) a
fraction, the numerator of which is the aggregate book value, on
April 2, 1996, of the subordinated interests associated with all
predecessor Liens and the denominator of which is the sum of (a)
such aggregate book value of such subordinated interests and (b)
the outstanding balance, on April 2, 1996, of the related senior
interests; and
(B) in the case of Excess Spread Receivables other than Pre-
Existing Excess Spread Receivables, any Lien thereon, provided that at
the date of Incurrence of such Lien (i) the fair market value (as
determined in good faith by the Board of Directors) as of such date of
all Excess Spread Receivables then subject to Liens (other than
Permitted Liens described under another clause of this definition)
collectively does not exceed (ii) (x) 50% of the book value of
Eligible Excess Spread Receivables shown on the balance sheet of the
Company and its consolidated Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP, as of the end of the most
recent fiscal quarter of the Company prior to the creation of such
Lien for which financial statements are available minus (y) the amount
of Indebtedness then secured by Liens permitted by clause (o) below;
and
(II) for purposes of this clause (g), any Lien on the Capital
Stock of any Person substantially all the assets of which are Excess Spread
Receivables shall be treated as a Lien on the Excess Spread Receivables of such
Person;
(h) Liens existing on the Issue Date of a series of Securities;
(i) Liens on property or shares of Capital Stock of another Person at
the time such other Person becomes a Subsidiary of such Person; provided,
however, that such Liens are not created, incurred or assumed in connection
with, or in contemplation of, such other Person becoming such a Subsidiary;
provided, further, however, that such Lien may not extend to any other property
owned by such Person or any of its Subsidiaries;
(j) Liens on property at the time such Person or any of its
Subsidiaries acquires the property, including any acquisition by means of a
merger or consolidation with or
16
into such Person or a Subsidiary of such Person; provided, however, that such
Liens are not created, incurred or assumed in connection with, or in
contemplation of, such acquisition; provided, further, however, that the Liens
may not extend to any other property owned by such Person or any of its
Subsidiaries;
(k) Liens securing Indebtedness or other obligations of a Subsidiary
of such Person owing to such Person or a Consolidated Restricted Subsidiary of
such Person;
(l) Liens (other than on any Excess Spread Receivables) securing
Hedging Obligations;
(m) Liens on cash or other assets (other than Excess Spread
Receivables) securing Warehouse Indebtedness of the Company or its Restricted
Subsidiaries;
(n) Liens to secure any Refinancing (or successive Refinancings) as a
whole, or in part, of any Indebtedness secured by any Lien referred to in the
foregoing clauses (f),(h), (i) and (j); provided, however, that (I) such new
Lien shall be limited to all or part of the same property that secured the
original Lien (plus improvements to or on such property) and (II) the
Indebtedness secured by such Lien at such time is not increased to any amount
greater than the sum of (A) the outstanding principal amount or, if greater,
committed amount of the Indebtedness described under clauses (f), (h), (i) or
(j), as the case may be, at the time the original Lien became a Permitted Lien
and (B) an amount necessary to pay any fees and expenses, including premiums,
related to such refinancing, refunding, extension, renewal or replacement
(notwithstanding the foregoing, "Permitted Liens" will not include any Lien
described in clauses (f), (i) or (j) above to the extent such Lien applies to
any Additional Assets acquired directly or indirectly from Net Available Cash
pursuant to Section 10.08); and
(o) Liens, other than Liens described in clauses (a) - (n) above, on
any assets of the Company or Restricted Subsidiaries to secure Indebtedness if
the amount of such Indebtedness to be secured by such Lien, when taken together
with (x) the aggregate amount of Indebtedness then outstanding and secured by
Liens created pursuant to this clause (o) and (y) the aggregate amount of
Warehouse Margin Indebtedness then outstanding, does not exceed 10% of the
Consolidated Net Worth of the Company.
"Permitted Warehouse Indebtedness" means Warehouse Indebtedness;
provided, however, that (i) the excess, if any, of (x) the amount of any such
Warehouse Indebtedness for which the holder thereof has contractual recourse to
the Company or its Restricted Subsidiaries to satisfy claims with respect to
such Warehouse Indebtedness over (y) the aggregate (without duplication of
amounts) realizable value of the assets which secure such Warehouse Indebtedness
shall not be Permitted Warehouse Indebtedness, and (ii) any such Indebtedness
may not have a term in excess of 364 days.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, limited liability company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Pre-Existing Excess Spread Receivable" means an Excess Spread
Receivable created on or prior to April 2, 1996.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for
17
the purposes of this definition, any Security authenticated and delivered under
Section 3.06 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Security shall be deemed to evidence the same debt as the mutilated,
destroyed, lost or stolen Security.
"Preferred Stock", as applied to the Capital Stock of any Person,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over shares of Capital Stock of any other class of such Person.
"Principal" of a Security means the principal of the Security plus the
premium, if any, payable on the Security which is due or overdue or is to become
due at the relevant time.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Rating Agencies" mean Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., and Xxxxx'x Investors Service, Inc. or any successor to the
respective rating agency businesses thereof.
"Receivables" means consumer and commercial loans, leases, accounts
and other receivables purchased or originated by the Company, any Restricted
Subsidiary or a Strategic Alliance Client in the ordinary course of business;
provided, however, that for purposes of determining the amount of a Receivable
at any time, such amount shall be determined in accordance with GAAP,
consistently applied, as of the most recent practicable date.
"Record Date" for the interest payable on any Interest Payment Date on
the Securities of any series means the date specified as such in the terms of
the Securities of such series.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Refinance" means, in respect of any Indebtedness, to refinance,
extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue
other Indebtedness in exchange or replacement for, such Indebtedness.
"Refinanced" and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" in respect of a series of Securities means
Indebtedness that Refinances any Indebtedness of the Company or any Restricted
Subsidiary existing on the Issue Date of such series or Incurred in compliance
with this Indenture including Indebtedness that Refinances Refinancing
Indebtedness; provided, however, that (i) such Refinancing Indebtedness has a
Stated Maturity no earlier than the Stated Maturity of the Indebtedness being
Refinanced, (ii) such Refinancing Indebtedness has an Average Life at the time
such Refinancing Indebtedness is Incurred that is equal to or greater than the
Average Life of the Indebtedness being Refinanced and (iii) such Refinancing
Indebtedness has an aggregate principal amount (or if Incurred with original
issue discount, an aggregate issue price) that is equal to or less than the
aggregate principal amount (or if Incurred with original issue discount, the
aggregate accreted value) then outstanding or committed (plus fees and expenses,
including
18
any premium and defeasance costs) under the Indebtedness being Refinanced;
provided, further, however, that Refinancing Indebtedness shall not include (x)
Indebtedness of a Subsidiary that Refinances Indebtedness of the Company or
another Subsidiary or (y) Indebtedness of the Company or a Restricted Subsidiary
that Refinances Indebtedness of an Unrestricted Subsidiary.
"Registered Holder" means the Holder of a Registered Security.
"Registered Security" means any Security issued under this Indenture
which is registered as to principal and interest in the Security Register.
"Related Business" means any consumer or commercial finance business
or any financial service business.
"Responsible Officer", when used with respect to the Trustee, means
any officer, including any vice president, assistant vice president, assistant
treasurer or corporate trust officer, of the Trustee with direct responsibility
for the administration of this Indenture and also means, with respect to a
particular corporate trust matter, any other officer or employee to whom such
matter is referred because of his knowledge of and familiarity with the
particular subject.
"Restricted Payment" with respect to any Person and in respect of a
series of Securities means (i) the declaration or payment of any dividends or
any other distributions of any sort in respect of its Capital Stock (including
any payment in connection with any merger or consolidation involving such
Person) or similar payment to the direct or indirect holders of its Capital
Stock (other than (A) dividends or distributions payable solely in its Capital
Stock (other than Disqualified Stock), (B) dividends or distributions payable
solely to the Company or a Restricted Subsidiary and (C) pro rata dividends or
other distributions made by a Subsidiary that is not a Wholly Owned Subsidiary
to minority stockholders (or owners of an equivalent interest in the case of a
Subsidiary that is an entity other than a corporation)), (ii) the purchase,
redemption or other acquisition or retirement for value of any Capital Stock of
the Company held by any Person or of any Capital Stock of a Restricted
Subsidiary held by any Affiliate of the Company (other than a Restricted
Subsidiary), including the exercise of any option to exchange any Capital Stock
(other than into Capital Stock of the Company that is not Disqualified Stock),
(iii) the purchase, repurchase, redemption, defeasance or other acquisition or
retirement for value, prior to scheduled maturity, scheduled repayment or
scheduled sinking fund payment of any Subordinated Obligations in respect of
such series (other than the purchase, repurchase or other acquisition of such
Subordinated Obligations purchased in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each case due within one
year of the date of acquisition) or (iv) the making of any Investment (other
than a Permitted Investment) in any Person.
"Restricted Subsidiary" means any Subsidiary of the Company that is
not an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Bearer Security, including any Coupon
appertaining thereto, or any Registered Security authenticated and delivered
under this Indenture.
19
"Securities Act" means the Securities Act of 1933.
"Senior Indebtedness" in respect of any series of Senior Securities
means (i) Indebtedness of any Person, whether outstanding on the Issue Date of
such series or thereafter Incurred and (ii) accrued and unpaid interest
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company to the extent post-
filing interest is allowed in such proceeding) in respect of (A) indebtedness of
such Person for money borrowed and (B) indebtedness evidenced by notes,
debentures, bonds or other similar instruments for the payment of which such
Person is responsible or liable unless, in the case of either clause (i) or
(ii), in the instrument creating or evidencing the same or pursuant to which the
same is outstanding, it is provided that such obligations are subordinate in
right of payment to the Securities of such series; provided, however, that
Senior Indebtedness shall not include (1) any obligation of such Person to any
Subsidiary of such Person, (2) any liability for Federal, state, local or other
taxes owed or owing by such Person, (3) any accounts payable or other liability
to trade creditors arising in the ordinary course of business (including
guarantees thereof or instruments evidencing such liabilities), (4) any
obligation in respect of Capital Stock of such Person or (5) that portion of any
Indebtedness which at the time of Incurrence is Incurred in violation of this
Indenture.
"Senior Securities" has the meaning stated in the first recital of
this Indenture.
"Significant Subsidiary" means any Restricted Subsidiary that would be
a "Significant Subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the SEC.
"Stated Maturity" means, when used with respect to any Security or any
installment of principal thereof or interest thereon, the date specified in such
Security as the fixed date on which the principal of such Security or such
installment of principal or interest is due and payable including pursuant to
any mandatory redemption provision (but excluding any provision providing for
the repurchase of such security at the option of the Holder thereof upon the
happening of any contingency unless such contingency has occurred).
"Strategic Alliance Client" means any Person (other than a Restricted
Subsidiary) engaged in a Related Business to which the Company or a Restricted
Subsidiary of the Company provides, or reasonably expects to provide, financing
or asset securitization expertise in return for asset-backed underwriting or
placement agent commitments or long-term purchase and sale of assets.
"Subordinated Obligations" in respect of any series of Securities
means any Indebtedness of the Company (whether outstanding on the Issue Date of
such series or thereafter Incurred) which is subordinate or junior in right of
payment to the Securities of such series pursuant to a written agreement to that
effect.
"Subordinated Securities" has the meaning stated in the first recital
of this Indenture.
"Subordinated Securities Payment" has the meaning specified in Section
14.02.
"Subsidiary" means, in respect of any Person, any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of shares of Capital Stock or other interests (including
partnership interests) entitled (without regard to the
20
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
(i) such Person, (ii) such Person and one or more Subsidiaries of such Person or
(iii) one or more Subsidiaries of such Person.
"Temporary Cash Investments" means any of the following: (i) any
investment in direct obligations of the United States of America or any agency
thereof or obligations guaranteed by the United States of America or any agency
thereof, (ii) investments in time deposit accounts, certificates of deposit and
money market deposits maturing within 180 days of the date of acquisition
thereof issued by a bank or trust company that is not an Affiliate of the
Company and which is organized under the laws of the United States of America,
any state thereof or any foreign country recognized by the United States, and
which bank or trust company has capital, surplus and undivided profits
aggregating in excess of $50,000,000 (or the foreign currency equivalent
thereof) and has outstanding debt which is rated "A" (or such similar equivalent
rating) or higher by at least one nationally recognized statistical rating
organization (as defined in Rule 436 under the Securities Act) or any money-
market fund sponsored by a registered broker dealer or mutual fund distributor,
(iii) repurchase obligations with a term of not more than 30 days for underlying
securities of the types described in clause (i) above entered into with a bank
meeting the qualifications described in clause (ii) above, (iv) investments in
commercial paper, maturing not more than 90 days after the date of acquisition,
issued by a corporation (other than an Affiliate of the Company) organized and
in existence under the laws of the United States of America or any foreign
country recognized by the United States of America with a rating at the time as
of which any investment therein is made of "P-1" (or higher) according to
Xxxxx'x Investors Service, Inc. or "A-1" (or higher) according to Standard and
Poor's Ratings Group, and (v) investments in securities with maturities of six
months or less from the date of acquisition issued or fully guaranteed by any
state, commonwealth or territory of the United States of America, or by any
political subdivision or taxing authority thereof, and rated at least "A" by
Standard & Poor's Ratings Group or "A" by Xxxxx'x Investors Service, Inc.
"Trading Day" means, with respect to any Capital Stock of the Company,
so long as such Capital Stock is listed or admitted to trading on the NYSE, a
day on which the NYSE is open for the transaction of business, or, if such
Capital Stock is not listed or admitted to trading on the NYSE, a day on which
the principal national securities exchange on which such Capital Stock is listed
is open for the transaction of business, or, if such Capital Stock is not so
listed or admitted for trading on any national securities exchange, a day on
which Nasdaq National Market is open for the transaction of business.
"Trust Indenture Act" (except as otherwise provided in Section 9.05)
means the Trust Indenture Act of 1939, as amended, as in force at the date as of
which this instrument was executed; provided, however, that in the event the
Trust Indenture Act of 1939 is amended after such date, "Trust Indenture Act"
means, to the extent required by any such amendment, the Trust Indenture Act of
1939 as so amended.
"Trustee" means, initially, The Bank of New York, until a successor
Trustee shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Trustee" shall mean or include each Person who is
then a Trustee hereunder, and if at any time there is more than one such Person,
"Trustee" as used with respect to the Securities of any series shall mean the
Trustee with respect to Securities of that series.
"Uniform Commercial Code" means the New York Uniform Commercial Code
as in effect from time to time.
21
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that
at the time of determination shall be designated an Unrestricted Subsidiary by
the Board of Directors in the manner provided below and (ii) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors may designate any Subsidiary
of the Company (including any newly acquired or newly formed Subsidiary) to be
an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries
owns any Capital Stock or Indebtedness of, or holds any Lien on any property of,
the Company or any other Subsidiary of the Company that is not a Subsidiary of
the Subsidiary to be so designated; provided, however, that either (A) the
Subsidiary to be so designated has total assets of $1,000 or less or (B) if such
Subsidiary has assets greater than $1,000, such designation would be permitted
under Section 10.06. The Board of Directors may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided, however, that immediately
after giving effect to such designation (x) the Company could Incur $1.00 of
additional Indebtedness under Section 10.04(a) and (y) no Default shall have
occurred and be continuing. Any such designation by the Board of Directors shall
be evidenced by the Company to the Trustee by promptly filing with the Trustee a
copy of the Board Resolution giving effect to such designation and an Officers'
Certificate certifying that such designation complied with the foregoing
provisions.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable at the issuer's option.
"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 of "vice president".
"Voting Stock" of a Person means all classes of Capital Stock or other
interests (including partnership interests or membership interests) of such
Person then outstanding and normally entitled (without regard to the occurrence
of any contingency) to vote in the election of directors, managers or trustees
thereof.
"Warehouse Facility" means any funding arrangement with a financial
institution or other lender or purchaser exclusively to finance the purchase or
origination of Receivables by the Company, a Subsidiary of the Company or a
Strategic Alliance Client for the purpose of pooling such Receivables prior to
securitization or sale in the ordinary course of business, including (i)
facilities pursuant to which the Company or a Subsidiary of the Company funds
Receivables owned or financed by a Strategic Alliance Client and (ii) any
arrangement in which the Company or a Subsidiary of the Company provides
Guarantees to a financial institution or other lender with respect to a
Strategic Alliance Client for the purpose of inducing such financial institution
or other lender to fund the purchase or origination of Receivables by such
Strategic Alliance Client.
"Warehouse Indebtedness" means Indebtedness in connection with a
Warehouse Facility; the amount of any particular Warehouse Indebtedness as of
any date of determination shall be the greater of:
(A) (i) with respect to Warehouse Indebtedness relating to a Warehouse
Facility described in clause (i) of the definition of Warehouse Facility, the
consideration received by the Company or its Restricted Subsidiaries under such
Warehouse Facility and not previously repaid to the Holder of such Warehouse
Indebtedness or (ii) with respect to Warehouse
22
Indebtedness relating to a Warehouse Facility described in clause (ii) of the
definition of Warehouse Facility, the maximum amount of the related Guarantee;
and
(B) the book value of the assets securing such Warehouse Facility.
"Warehouse Margin Indebtedness" means Warehouse Indebtedness which
does not constitute Permitted Warehouse Indebtedness solely due to, and shall
equal the amount equal to the excess resulting from, the application of clause
(i) of the definition of Permitted Warehouse Indebtedness.
"Wholly Owned Subsidiary" means a Restricted Subsidiary all the
Capital Stock of which (other than directors' qualifying shares and shares held
by other Persons to the extent such shares are required by applicable law to be
held by a Person other than the Company or a Restricted Subsidiary) is owned by
the Company or one or more Wholly Owned Subsidiaries.
"Yield to Maturity" means, in the case of any Original Issue Discount
Security, the yield to maturity specified in such Security or in a Board
Resolution relating thereto.
Section 1.02 Other Definitions.
Term Defined in
---- Section
----------
"Affiliate Transaction"....................................................... 10.09
"Conversion Date"............................................................. 3.11(d)
"Covenant Defeasance"......................................................... 13.03
"Covenant Termination"........................................................ 10.15
"Defaulted Interest".......................................................... 3.07
"Defeasance".................................................................. 13.02
"Dollar Equivalent of the Currency Unit"...................................... 3.11(g)
"Dollar Equivalent of the Foreign Currency"................................... 3.11(f)
"Election Date"............................................................... 3.11(h)
"Government Obligations"...................................................... 13.04
"Offer"....................................................................... 10.08
"Offer Amount"................................................................ 10.08
"Offer Period"................................................................ 10.08
"Proceeding".................................................................. 14.02
"Purchase Date"............................................................... 10.08
"Security Register"........................................................... 3.05
"Security Registrar".......................................................... 3.05
"Special Record Date"......................................................... 3.07
"Successor Company"........................................................... 8.01
"Temporary Securities"........................................................ 3.04
Section 1.03 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 such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by any officer of
23
the Company, or Opinion of Counsel, if to be given by counsel, and shall comply
with the requirements of the Trust Indenture Act and any other requirements set
forth in this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein relating
thereto;
(b) 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;
(c) 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
(d) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
Section 1.04 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. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.
Where any Person is 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 1.05 Acts of Holders; Record Dates.
(a) Whenever in this Indenture it is provided that the Holders of a
specified percentage in aggregate principal amount of the Securities of any
series may take any action (including the making of any demand or request, the
giving of any notice, consent or waiver or
24
the taking of any other action), the fact that at the time of taking any such
action the Holders of such specified percentage have joined therein may be
evidenced (1) by any instrument or any number of instruments of similar tenor
executed by such Holders in person or by agent or proxy appointed in writing, or
(2) by the record of such Holders of Securities voting in favor thereof at any
meeting of such Holders duly called and held, or (3) by a combination of such
instrument or instruments and any such record of such a meeting of such Holders;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments and/or such record are delivered
to the Trustee and, where it is expressly required, to the Company. Proof of
execution of any instrument or of a writing appointing any such agent or proxy
shall be sufficient for any purpose of this Indenture and (subject to the
requirements of the Trust Indenture Act and Section 6.01) conclusive in favor of
the Trustee and the Company, if made in the manner provided in this Section
1.05.
Without limiting the generality of the foregoing, a Holder, including
a Depositary that is a Holder of a Global Security, may make, give or take, by a
proxy or proxies, duly appointed in writing, any request, demand, authorization,
direction, notice, consent, waiver or other action provided or permitted in this
Indenture to be made, given or taken by Holders, and a Depositary that is a
Holder of a Global Security may provide its proxy or proxies to the beneficial
owners of interest in any such Global Security.
(b) Subject to the requirements of the Trust Indenture Act and
Sections 6.01 and 6.03, proof of the execution of any instrument by a Holder or
his agent or proxy shall be sufficient if made in accordance with such
reasonable rules and regulations as may be prescribed by the Trustee or in such
manner as shall be satisfactory to the Trustee.
(c) If the Company shall solicit from the Registered Holders any
demand, request, notice, consent, waiver or the taking of any other action, the
Company may, at its option, by a Board Resolution, fix in advance a record date
for the determination of Registered Holders entitled to give such demand,
request, notice, consent or waiver or to take such other action, but the Company
shall have no obligation to do so. If such a record date is fixed, such demand,
request, notice, consent, waiver or other action may be given before or after
the record date, but only the Registered Holders of record at the close of
business on the record date shall be deemed to be Holders for the purposes of
determining whether Holders of the requisite percentage of Securities
Outstanding have authorized or agreed or consented to such demand, request,
notice, consent, waiver or taking of any other action, and for that purpose the
Securities Outstanding shall be computed as of the record date; provided,
however, that no such demand, request, notice, consent, waiver or taking of any
other action by the Holders on the record date shall be deemed effective unless
it shall become effective pursuant to the provisions of this Indenture not later
than six months after the Record Date.
(d) The ownership of Registered Securities shall be proved by the
Security Register or by a certificate of the Person designated by the Company to
keep the Security Register and to act as repository in accordance with the
provisions of Section 3.05.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee, any
Paying Agent or the Company in reliance thereon, whether or not notation of such
action is made upon such Security.
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(f) At any time prior to (but not after) the evidencing to the Trustee
of the taking of any action by the Holders of the percentage in aggregate
principal amount of the Securities of any or all series, as the case may be,
specified in this Indenture in connection with such action, any Holder of a
Security the serial number or other distinguishing symbol of which is shown by
the evidence to be included among the serial numbers or other distinguishing
symbols of the Securities the Holders of which have consented to such action
may, by filing written notice at the Corporate Trust Office and upon proof of
holding as provided in this Article, revoke such action so far as concerns such
Security.
Section 1.06 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,
(a) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at 000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx, Xxx Xxxx, XX 00000,
Attention: Corporate Trust Trustee Administration.
(b) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company addressed to it
at 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention: Chief Counsel or at any other
address previously furnished in writing to the Trustee by the Company.
Section 1.07 Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, (i)
if any of the Securities affected by such event are Registered Securities, 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 Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any)
prescribed for the giving of such notice, and, (ii) if any of the Securities
affected by such event are Bearer Securities, notice to the Holders thereof
shall be sufficiently given (unless otherwise herein or in the terms of such
Bearer Securities expressly provided) if published once in an Authorized
Newspaper in New York, New York, and in such other city or cities, if any, as
may be specified as contemplated in Section 3.01.
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. In any case where notice is given to Holders by publication,
neither the failure to publish such notice, nor any defect in any notice so
published, 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 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. Notwithstanding anything to the contrary elsewhere
in this Indenture as to the giving of notice, any other form of written notice
is sufficient, if received.
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In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give any 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. If it is
impossible or, in the opinion of the Trustee, impracticable to give any notice
by publication in the manner herein required, then such publication in lieu
thereof as shall be made with the approval of the Trustee shall constitute a
sufficient publication of such notice.
Any request, demand, authorization, direction, notice, consent or
waiver required or permitted under this Indenture shall be in the English
language, except that any published notice may be in an official language of the
country of publication.
Section 1.08 Incorporators, Stockholders, Officers and Directors of Company,
Exemption from Individual Liability.
To the extent permitted by law, no recourse under or upon any
obligation, covenant or agreement contained in this Indenture, or in any
Security, or because of any indebtedness evidenced thereby, shall be had against
any incorporator, as such, or against any past, present or future stockholder,
officer or director, as such, of the Company or of any successor, either
directly or through the Company or any successor, under any rule of law, statute
or constitutional provision or by the enforcement of any assessment or by any
legal or equitable proceeding or otherwise, all such liability being expressly
waived and released by the acceptance of the Securities by the Holders thereof
and as part of the consideration for the issue of the Securities.
Section 1.09 Conflict with Trust Indenture Act.
This Indenture is subject to the provisions of the Trust Indenture Act
that are required to be a part of this Indenture and shall, to the extent
applicable, be governed by such provisions. If any provision hereof limits,
qualifies or conflicts with a provision of the Trust Indenture Act that is
required under such Act to be a part of and govern this Indenture, the provision
of the Trust Indenture Act 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 1.10 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 1.11 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 1.12 Separability Clause.
In case any provision in this Indenture or in the Securities 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.
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Section 1.13 Benefits of Indenture.
Nothing in this Indenture or in the Securities, 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 1.14 Governing Law.
This Indenture and the Securities shall be governed by and construed
in accordance with the laws of the State of New York, without regard to conflict
of law principles thereof.
Section 1.15 Legal Holidays.
In any case where any Interest Payment Date, Redemption Date, Stated
Maturity or Maturity of any Security shall not be a Business Day at the place of
payment, then (notwithstanding any other provision on this Indenture or of the
Securities (other than a provision of the Securities of any series which
specifically states that such provision shall apply in lieu of this Section))
payment of interest or principal (and premium, if any) need not be made on such
date, but may be made on the next succeeding Business Day in such place with the
same force and effect as if made on such Interest Payment Date or Redemption
Date or at the Stated Maturity or Maturity; provided, however, that no interest
shall accrue for the period from and after such Interest Payment Date,
Redemption Date, Stated Maturity or Maturity, as the case may be, to the next
succeeding Business Day.
Section 1.16 Counterparts.
This Indenture 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.
ARTICLE TWO
Security Forms
Section 2.01 Forms Generally.
The Securities of each series and any Coupons to be attached thereto
shall be substantially in such form as shall be established by a Board
Resolution or pursuant to authority granted by a Board Resolution or in one or
more indentures supplemental hereto, in each case with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and may have imprinted or otherwise reproduced
thereon such letters, numbers or other marks of identification and such legends
or endorsements placed thereon as may be required to comply with any applicable
law, rule or regulation or with the rules of any securities exchange or as may,
consistent with the provisions of this Indenture, be determined by the officers
executing such Securities, as evidenced by their execution of the Securities.
Temporary Securities of any series may be issued as permitted by Section 3.04.
If the form of Securities or Coupons of any series is established by action
taken pursuant to authority granted by a Board Resolution, a copy of an
appropriate record of any such action taken pursuant thereto, including a copy
of the approved form of Securities or Coupons, shall be certified by the
Secretary or an Assistant Secretary of the Company and delivered to the Trustee
at or prior to the
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delivery of the Company Order contemplated in Section 3.03 for the
authentication and delivery of such Securities. Any portion of the text of any
Security may be set forth on the reverse thereof, with an appropriate reference
thereto on the face of the Security.
Unless otherwise specified as contemplated in Section 3.01, Bearer
Securities shall have Coupons attached.
The definitive Securities and Coupons shall be printed, lithographed
or engraved on steel engraved borders or may be produced in any other manner,
all as determined by the officers executing such Securities, as evidenced by
their execution of such Securities and Coupons.
Section 2.02 Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication on all Securities shall be
in substantially the following form:
This is one of the Securities of the series designated herein and
referred to in the within-mentioned Indenture.
The Bank of New York,
As Trustee
By
-----------------------------
Authorized Signatory
Section 2.03 Additional Provisions Required in Global Security.
Any Global Security authenticated and delivered hereunder shall bear a
legend in substantially the following form:
"This Security is a Global Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of a Depositary
or a nominee thereof. This Security may not be transferred to, or registered or
exchanged for Securities registered in the name of, any Person other than the
Depositary or a nominee thereof and no such transfer may be registered, except
in the limited circumstances described in the Indenture. Every Security
authenticated and delivered upon registration or transfer of, or in exchange for
or in lieu of, this Security shall be a Global Security subject to the
foregoing, except in such limited circumstances."
ARTICLE THREE
The Securities
Section 3.01 Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
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The Securities may be issued in one or more series. There shall be
established in a Board Resolution or pursuant to authority granted by a Board
Resolution, a copy of which, certified by the Secretary or an assistant or
attesting Secretary of the Company, shall be delivered to the Trustee, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of a particular series, the following:
(a) the specific designation or title (including CUSIP Numbers) of the
Securities;
(b) the denominations in which such Securities are authorized to be
issued, if other than denominations of U.S.$1,000 or any integral multiple
thereof in the case of Registered Securities and US$5,000 in the case of Bearer
Securities;
(c) the aggregate principal amount of the Securities of the series
which may be authenticated and delivered under this Indenture (except for
Securities authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Securities of the series pursuant to Sections
3.04, 3.05, 3.06, 9.06 or 11.07 and except for any Securities which, pursuant to
Section 3.03, are deemed never to have been authenticated and delivered
hereunder);
(d) the date or dates on which the principal of the Securities of the
series will mature or the method by which such date or dates may be determined;
(e) the price or prices (expressed as a percentage of the aggregate
principal amount thereof) at which such Securities shall be issued;
(f) the rate or rates (which may be fixed or variable) at which the
Securities of the series shall bear interest, if any, or the method by which
such rate or rates shall be determined;
(g) the times and places where the principal of and any premium and
interest, if any, on Securities of the series shall be payable;
(h) the date or dates on which interest, if any, will be payable and
the applicable record date or dates or the method by which such date or dates
may be determined;
(i) the period or periods within which, the price or prices at which,
the Currency in which and other terms and conditions upon which Securities of
the series may be redeemed, in whole or in part, at the option of the Company;
(j) the obligation, if any, of the Company to redeem or purchase such
Securities pursuant to any sinking fund or analogous provisions upon the
happening of a specified event or at the option of a Holder thereof and the
period or periods within which, the price or prices at which, and other terms
and conditions upon which Securities of the series shall be redeemed or
purchased, in whole or in part, pursuant to such obligation;
(k) the terms and conditions upon which conversion of such Securities
will be effected, including the Conversion Price, the Conversion Period and any
other conversion provisions;
(l) the currency or currency units for which such Securities may be
purchased or in which such Securities may be denominated or the currency or
currency units in which principal or premium, if any, or interest, if any, on
such Securities will be payable and whether the
30
Company or the Holders of any such Securities may elect to receive payments in
respect of such Securities in a currency or currency units other than that in
which such Securities are stated to be payable;
(m) if other than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 5.02 or
provable in bankruptcy pursuant to Section 5.04;
(n) the person to whom any interest on any such Securities shall be
payable if other than the person in whose name such Security is registered on
the applicable record date;
(o) any addition to, or modification or deletion of, any Event of
Default or any covenant of the Company specified in this Indenture with respect
to such Securities;
(p) the applicability, if any, of Section 13.02 or Section 13.03 to
the Securities of such series, or such other means of defeasance or covenant
defeasance as may be specified for the Securities of such series;
(q) whether such Securities shall be issuable in whole or in part in
the form of one or more temporary or permanent Global Securities and, if so, the
Depositary or Depositaries for such Global Security or Global Securities;
(r) whether the Securities of such series shall be subordinated and
subject in right of payment to the prior payment in full of all Senior
Indebtedness as set forth in Article Fourteen hereunder or are Senior
Securities; and
(s) any other material or special terms of the series pertaining to
such Securities.
All Securities of any one series shall be substantially identical
except as to denomination, interest rate and maturity and except as may
otherwise be provided in or pursuant to such Board Resolution or in any such
indenture supplemental hereto. The applicable Board Resolution or the applicable
supplemental indenture may provide that Securities of any particular series may
be issued at various times, with different Maturities and redemption and
repayment provisions (if any) and bearing interest at different rates, but shall
for all purposes under this Indenture, including, but not limited to, voting and
Events of Default, be treated as Securities of a single series.
Section 3.02 Denominations.
In the absence of any specification as contemplated in Section 3.01
with respect to the Securities of any series, any Securities of a series shall
be issuable in denominations of U.S.$1,000 (or, if such Securities are
denominated in a currency other than United States dollars or in a composite
currency, 1,000 units of such other currency or composite currency) and any
integral multiple thereof in the case of Registered Securities and U.S.$5,000 in
the case of Bearer Securities. The Securities of each series shall be numbered,
lettered or otherwise distinguished in such manner or in accordance with such
plan as the officers of the Company who execute such Securities may determine
with the approval of the Trustee as evidenced by the execution and
authentication thereof.
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Section 3.03 Execution, Authentication, Delivery and Dating of Securities.
The Securities shall be signed on behalf of the Company by its
Chairman of the Board of Directors, its Vice Chairman of the Board of Directors,
its President or any of its Vice Presidents, under its corporate seal which may,
but need not, be attested by its Secretary or any of its Assistant Secretaries.
Such signatures may be the manual or facsimile signatures of such officers. The
seal of the Company may be in the form of a facsimile thereof and may be
impressed, affixed, imprinted or otherwise reproduced on the Securities.
Typographical and other minor errors or defects in any such reproduction of the
seal or any such signature shall not affect the validity or enforceability of
any Security that has been duly authenticated and delivered by the Trustee.
In case any officer of the Company who shall have signed any of the
Securities shall cease to be such officer before the Security so signed shall be
authenticated and delivered by the Trustee or disposed of by the Company, such
Security nevertheless may be authenticated and delivered or disposed of as
though the person who signed such Security had not ceased to be such officer of
the Company; and any Security may be signed on behalf of the Company by such
persons as, at the actual date of the execution of such Security, shall be the
proper officers of the Company, although at the date of the execution and
delivery of this Indenture any such person was not such an officer.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee, in accordance
with the Company Order, shall thereupon authenticate and deliver such Securities
without any further action by the Company. In authenticating such Securities and
accepting the additional responsibilities under this Indenture in relation to
such Securities the Trustee shall be entitled to receive, and (subject to the
requirements of the Trust Indenture Act) shall be fully protected in relying
upon:
(a) a copy of any Board Resolution or Board Resolutions relating to
such series and, if applicable, an appropriate record of any action taken
pursuant to such Board Resolutions as prescribed in Sections 2.01 and 3.01;
(b) an executed supplemental indenture, if any, relating thereto; and
(c) an Officers' Certificate setting forth the form and terms of the
Securities as required pursuant to Sections 2.01 and 3.01, respectively, and
prepared in accordance with the requirements of the Trust Indenture Act and
Section 1.04.
The Trustee shall have the right to decline to authenticate and
deliver any Securities under this Section if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken by the Company or
if the Trustee in good faith by its board of directors or board of trustees,
executive committee or a trust committee of directors or trustees or Responsible
Officers shall determine that such action would expose the Trustee to personal
liability to existing Holders or adversely affect the Trustee's own rights,
duties or immunities under this Indenture or otherwise.
The Trustee shall not be required to authenticate Securities
denominated in a coin or currency other than that of the United States of
America if the Trustee reasonably determines that such Securities impose duties
or obligations on the Trustee which the Trustee is not able or
32
reasonably willing to accept; provided, however, that the Trustee, upon the
request of the Company, will resign as Trustee with respect to Securities of any
series as to which such a determination is made, prior to the issuance of such
Securities, and will comply with the request of the Company to execute and
deliver a supplemental indenture appointing a successor Trustee pursuant to
Section 9.01.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate the Securities. Unless limited by the terms of
such appointment, an authenticating agent may authenticate Securities whenever
the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as any Security Registrar, paying agent or agent for services of
notices and demands.
Notwithstanding the provisions of Section 3.01 and this Section 3.03,
if all Securities of a series are not to be originally issued at one time, it
shall not be necessary to deliver the Officers' Certificate and Company Order
otherwise required pursuant to this Section 3.03 at or prior to the time of
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
Each Security shall be dated the date of its authentication, shall
bear interest, if any, from the date, and shall be payable on the dates, in each
case, which shall be specified as contemplated in Section 3.01.
Only such Securities as shall bear thereon a certificate of
authentication substantially in the form hereinbefore recited, executed by the
Trustee by the manual signature of one of its authorized signatories, shall be
entitled to the benefits of this Indenture or be valid or obligatory for any
purpose. Such certificate by the Trustee upon any Security executed by the
Company shall be conclusive evidence that the Security so authenticated has been
duly authenticated and delivered hereunder and that the Holder is entitled to
the benefits of this Indenture. Notwithstanding the foregoing, if any Security
shall have been authenticated and delivered hereunder but never issued and sold
by the Company, and the Company shall deliver such Security to the Trustee for
cancellation as provided in Section 3.09, for all purposes of this Indenture
such Security shall be deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this Indenture.
Section 3.04 Temporary Securities.
Pending the preparation of definitive Securities for any series, the
Company may execute, and upon a Company Order the Trustee shall authenticate and
deliver, temporary Securities ("Temporary Securities") for such series printed,
lithographed, typewritten or otherwise produced. Temporary Securities of any
series shall be issuable, with or without coupons, in any authorized
denomination, and substantially of the tenor or form of the definitive
Securities of such series in lieu of which they are issued but with such
omissions, insertions and variations as may be appropriate for Temporary
Securities, all as may be determined by the Company. Temporary Securities may
contain such reference to any provisions of this Indenture as may be
appropriate. Every Temporary Security shall be authenticated by the Trustee upon
the same conditions and in substantially the same manner, and with like effect,
as the definitive Securities in lieu of which they are issued. Without
unreasonable delay the Company shall execute and shall furnish definitive
Securities of such series and thereupon Temporary Securities of such series may
be surrendered (together with any unmatured Coupons) in exchange therefor
without
33
charge at each office or agency to be maintained by the Company for that purpose
pursuant to Section 10.02, and the Trustee shall authenticate and deliver in
exchange for such Temporary Securities of such series a like aggregate principal
amount of definitive Securities of the same series of authorized denominations
having the same interest rate, Maturity and redemption and repayment provisions
and bearing interest from the same date as such Temporary Securities; provided,
however, that no definitive Bearer Security shall be delivered in exchange for a
temporary Registered Security; and provided, further, that no definitive Bearer
Security shall be delivered in exchange for a temporary Bearer Security unless a
Responsible Officer of the Trustee shall have actually received from the Person
entitled to receive the definitive Bearer Security a certificate substantially
in the form approved in the Board Resolutions relating thereto and such delivery
shall occur only outside the United States of America. Until so exchanged, the
Temporary Securities of any series shall be entitled to the same benefits under
this Indenture as definitive Securities of the same series authenticated and
delivered hereunder.
Section 3.05 Registration, Registration of Transfer and Exchange.
The Company will keep, either at the office or agency designated and
maintained by the Company in the Borough of Manhattan, the City of New York, in
accordance with the provisions of Section 10.02, or at any of such other offices
or agencies as may be designated and maintained in accordance with the
provisions of Section 10.02, a register or registers in which, subject to such
reasonable regulations as it may prescribe, it will register, and will register
the transfer of, Registered Securities of a series. Each such register is
sometimes herein referred to as a "Security Register". Each Security Register
shall be in written form in the English language or in any other form capable of
being converted into such form within a reasonable time. At all normal business
hours such Security Register shall be open for inspection by the Trustee and any
Security Registrar.
Upon surrender for registration of transfer of any Security of any
series at any such office or agency to be maintained for the purpose as provided
in Section 10.02, the Company shall execute, and the Trustee shall authenticate
and deliver, in the name of the designated transferee or transferees, one or
more new Registered Securities of the same series and of like tenor in any
authorized denomination for a like aggregate principal amount and having the
same interest rate, Maturity, repayment and redemption provisions.
Bearer Securities (except for any temporary global Bearer Securities)
or any Coupons appertaining thereto (except for Coupons attached to any
temporary global Bearer Security) shall be transferable by delivery.
At the option of the Holder, Registered Securities of any series may
be exchanged for other Registered Securities of the same series and of like
tenor in other authorized denominations, in an equal aggregate principal amount
and having the same interest rate, Maturity, repayment and redemption
provisions. Registered Securities of any series to be exchanged shall be
surrendered at any office or agency to be maintained by the Company for the
purpose as provided in Section 10.02, and the Company shall execute, and the
Trustee shall authenticate and deliver, in exchange therefor the Registered
Securities of the same series and having the same interest rate and Maturity
which the Holder making the exchange shall be entitled to receive, bearing
numbers or other distinguishing symbols not contemporaneously outstanding. Each
Person designated by the Company pursuant to the provisions of Section 10.02 as
a Person authorized to register and register the transfer of the Registered
Security is sometimes herein referred to as a "Security Registrar". The Company
may have one or more Security Registrars. The Company or any of its domestic
Subsidiaries may act as Security Registrar.
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Unless otherwise specified as contemplated in Section 3.01, at the
option of the Holder, Bearer Securities of such series may be exchanged for
Registered Securities (if the Securities of such series are issuable in
registered form) or Bearer Securities (if Bearer Securities of such series are
issuable in more than one denomination and such exchanges are permitted by such
series) of the same series, of any authorized denominations and of like tenor
and aggregate principal amount, upon surrender of the Bearer Securities to be
exchanged at any such office or agency, with all unmatured Coupons and all
matured Coupons in default. If the Holder of a Bearer Security is unable to
produce any such unmatured Coupon or matured Coupon in default, such exchange
may be effected if the Bearer Securities are accompanied by payment in funds
acceptable to the Company and the Trustee in an amount equal to the face amount
of such missing Coupon, or the surrender of such missing Coupon may be waived by
the Company and the Trustee if there be furnished to them such security or
indemnity as they may require to save each of them and any Paying Agent
harmless. If thereafter the Holder of such Security shall surrender to any
Paying Agent any such missing Coupon in respect of which such a payment shall
have been made, such Holder shall be entitled to receive the amount of such
payment; provided, however, that, except as otherwise provided in Section 10.02,
interest represented by Coupons shall be payable only upon presentation and
surrender of those Coupons at an office or agency located outside the United
States of America. Notwithstanding the foregoing, in case any Bearer Security of
any series is surrendered at any such office or agency in exchange for a
Registered Security of the same series after the close of business at such
office or agency on (i) any Record Date and before the opening of business at
such office or agency on the relevant Interest Payment Date, or (ii) any Special
Record Date and before the opening of business at such office or agency on the
related date for payment of Defaulted Interest, such Bearer Security shall be
surrendered without the Coupon relating to such Interest Payment Date or
proposed date of payment, as the case may be (or, if such Coupon is so
surrendered with such Bearer Security, such Coupon shall be returned to the
Person so surrendering the Bearer Security), and interest or Defaulted Interest,
as the case may be, will not be payable on such Interest Payment Date or
proposed date of payment, as the case may be, in respect of the Registered
Security issued in exchange for such Bearer Security, but will be payable only
to the Holder of such Coupon, when due in accordance with the provisions of this
Indenture.
The Company will at all times designate one Person (who may be the
Company and who need not be a Security Registrar) to act as repository of a
master list of names and addresses of the Holders of the Registered Securities.
The Corporate Trust Office of the Trustee shall act as such repository unless
and until some other Person is, by written notice from the Company to such
office or agency and each Security Registrar, designated by the Company to act
as such. The Company shall cause each Security Registrar to furnish to such
repository, on a current basis, such information as to all registrations of
transfer and exchanges effected by such Security Registrar, as may be necessary
to enable such repository to maintain the master list of Registered Holders on
as current a basis as is practicable.
No Person shall at any time be designated as or act as a Security
Registrar unless such Person is at such time empowered under applicable law to
act as such and duly registered to act as such under and to the extent required
by applicable law and regulations.
Every Registered Security presented for registration of transfer,
exchange, redemption or payment shall (if so required by the Company or the
Trustee) be duly endorsed by, or be accompanied by a written instrument of
transfer or exchange in form satisfactory to the Company and the Trustee duly
executed by, the Holder or his attorney duly authorized in writing.
35
The Company may require payment of a sum sufficient to cover any tax,
penalty or other governmental charge that may be imposed in connection with any
exchange or registration of transfer of Securities, other than exchanges
pursuant to Section 3.04, 9.06 or 11.07 not involving any registration of
transfer. No service charge shall be made for any such transaction.
The Company shall not be required (1) to exchange or register a
transfer of any Securities of any series for a period of 15 days next preceding
the mailing of a notice of redemption of Securities of that series to be
redeemed, (2) to exchange or register a transfer of any Registered Securities
selected, called or being called for redemption or surrendered for repayment in
whole or in part except, in the case of any Security to be redeemed or repaid in
part, the portion thereof not so to be redeemed or repaid, or (3) to exchange
any Bearer Security so selected for redemption, except that such a Bearer
Security may be exchanged for a Registered Security of that series and like
tenor; provided, however, that such Registered Security shall be simultaneously
surrendered for redemption.
Notwithstanding the foregoing and except as otherwise specified or
contemplated in Section 3.01, no Global Security shall be exchangeable pursuant
to this Section 3.05 or Sections 3.04, 9.06, and 11.07 for the Securities of,
and no transfer of a Global Security of any series may be registered to, any
Person other than the Depositary for such Security or its nominee unless (1)
such Depositary (A) notifies the Company that it is unwilling or unable to
continue as Depositary for such Global Security or (B) ceases to be a clearing
agency registered under the Securities Exchange Act of 1934, as amended, (2) the
Company executes and delivers to the Trustee a Company Order that such Global
Security shall be so exchangeable and the transfer thereof so registrable, or
(3) there shall have occurred and be continuing an Event of Default, or an event
which after notice or lapse of time would be an Event of Default, with respect
to the Securities evidenced by such Global Security. Upon the occurrence in
respect of any Global Security of any series of any one or more of the
conditions specified in clauses (1), (2) or (3) of the preceding sentence or
such other conditions as may be specified as contemplated in Section 3.01 for
such series, such as that the Securities of such series may be exchanged for
Bearer Securities, such Global Security may be exchanged for Registered
Securities in the names of, and the transfer of such Global Security may be
registered to, such Persons (including Persons other than the Depositary with
respect to such series and its nominees), as such Depositary shall direct.
Notwithstanding any other provision of this Indenture, any Security
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, any Global Security shall also be a Global Security and
shall bear the legend specified in Section 2.03 except for any Security
authenticated and delivered in exchange for, or upon registration of transfer
of, a Global Security pursuant to the preceding sentence.
Section 3.06 Mutilated, Defaced, Destroyed, Lost and Stolen Securities.
In case any temporary or definitive Security or Coupon shall become
mutilated or defaced or be destroyed, lost or stolen, in the absence of notice
to the Company or the Trustee that such Security or Coupon has been acquired by
a bona fide purchaser, the Company may in its discretion execute, and the
Trustee, upon a Company Request, shall authenticate and deliver, a new
Registered Security, if such surrendered Security was a Registered Security, or
a new Bearer Security with Coupons corresponding to the Coupons appertaining to
the surrendered Security, if such surrendered Security was a Bearer Security,
which shall be of the same series and of like tenor and aggregate principal
amount, bearing a number or other distinguishing symbol not contemporaneously
Outstanding, in exchange and substitution for the mutilated or defaced Security,
or in lieu of and substitution for the Security so destroyed, lost or stolen. In
every case
36
the applicant for a substitute Security shall furnish to the Company and to the
Trustee (and any agent of the Company or Trustee, if requested by the Company)
such security or indemnity as may be required by them to indemnify and defend
and to save each of them harmless and, in every case of destruction, loss or
theft, evidence to their satisfaction of the destruction, loss or theft of such
Security, or of such Coupon appurtenant thereto, and of the ownership thereof.
Upon the issuance of any substitute Security, 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
reasonable fees and expenses of the Trustee and its counsel) connected
therewith.
In case any Security that has matured or is about to mature or has
been called for redemption in full shall become mutilated or defaced or be
destroyed, lost or stolen, the Company in its discretion may instead of issuing
a substitute Security pay or authorize the payment of the same (without
surrender thereof except in the case of a mutilated or defaced Security), if the
applicant for such payment shall furnish to the Company and to the Trustee (and
any agent of the Company or the Trustee, if requested by the Company or the
Trustee) such security or indemnity as any of them may require to indemnify and
defend and to save each of them harmless, and, in every case of destruction,
loss or theft, evidence to their satisfaction of the destruction, loss or theft
of such Security and of the ownership thereof.
Every substituted Security (and every appurtenant Coupon, if any) of
any series issued pursuant to the provisions of this Section by virtue of the
fact that any such Security is destroyed, lost or stolen shall constitute an
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone and shall be
entitled to all the benefits of (but shall be subject to all the limitations of
rights set forth in) this Indenture equally and proportionately with any and all
other Securities of such series duly authenticated and delivered hereunder. All
Securities shall be held and owned upon the express condition that, to the
extent permitted by law, the foregoing provisions are exclusive with respect to
the replacement or payment of mutilated, defaced, destroyed, lost or stolen
Securities and shall preclude (to the extent lawful) any and all other rights or
remedies notwithstanding any law or statute existing or hereafter enacted to the
contrary with respect to the replacement or payment of negotiable instruments or
other securities without their surrender.
Section 3.07 Payment of Interest; Interest Rights Preserved.
Except as otherwise specified for a particular series pursuant to
Section 3.01, interest on any Registered Security 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 Registered Security (or one or more Predecessor
Securities) is registered in the Security Register at the close of business on
the Record Date for such interest at the Company's option either (i) by check
mailed to the address of such Person as referenced in the Security Register or
(ii) by wire transfer to an account designated by such Person pursuant to an
arrangement that is satisfactory to the Company and the Trustee. Unless
otherwise provided pursuant to Section 3.01, the Company shall pay to the
Trustee or the Paying Agent the aggregate amount of interest in immediately
available funds by 10:00 A.M. New York City time on the Interest Payment Date.
The Trustee shall not be held responsible or liable for any loss resulting from
a failure of the federal funds wire system or any other occurrence beyond its
control in connection with wire transfers made pursuant to this Section 3.07.
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Except as otherwise specified for a particular series pursuant to
Section 3.01, (i) interest on any Bearer Securities shall be paid only against
presentation and surrender of the Coupons for such interest installments as are
evidenced thereby as they mature and (ii) the accreted amount, if any, with
respect to Bearer Securities which constitute Original Issue Discount Securities
shall be paid only against presentation and surrender of such Securities; in
either case at the office of a Paying Agent located outside the United States of
America, unless the Company shall have otherwise instructed the Trustee in
writing, provided that the Company furnishes the Trustee with an Opinion of
Counsel stating that any such instruction for payment in the United States of
America does not cause any Bearer Security to be treated as a "registration-
required obligation" under United States laws and regulations. The interest on
any temporary Bearer Security shall be paid, as to any installment of interest
evidenced by a Coupon attached thereto, only upon presentation and surrender of
such Coupon and, as to other installments of interest, only upon presentation of
such Security for notation thereon of the payment of such interest. If at the
time a payment of principal of or interest on a Bearer Security or Coupon shall
become due, the payment of the full amount so payable at the office or offices
of all the Paying Agents outside the United States is illegal or effectively
precluded because of the imposition of exchange controls or other similar
restrictions on the payment of such amount in United States dollars, then the
Company may instruct the Trustee in writing to make such payments at a Paying
Agent located in the United States of America, provided that the Company
furnishes the Trustee with an Opinion of Counsel stating that provision for such
payment in the United States of America would not cause such Bearer Security to
be treated as a "registration-required obligation" under United States laws and
regulations.
Any interest on any Registered Security of any series 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 Record Date by virtue of having been such
Holder, and such Defaulted Interest may be paid by the Company, at its election
in each case, as provided in clause (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Registered Securities of such series (or their
respective Predecessor Securities) are registered at the close of business on a
special record date ("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 not less than 30 days prior to the date of the proposed
payment of the amount of Defaulted Interest proposed to be paid on each Security
of such series 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 clause
provided. Thereupon the Trustee shall fix a Special Record Date for the payment
of such Defaulted Interest which shall be not more than 15 days and not less
than 10 days prior to the date of the proposed payment and not less than 10 days
after the receipt by the Trustee of the notice of the proposed payment. The
Trustee shall 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 Registered Securities of
such series at its address as it appears in the Security Register, not less than
10 days prior to such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose names the
Registered Securities of such series (or
38
their respective Predecessor Securities) are registered at the close of business
on such Special Record Date and shall no longer be payable pursuant to the
following clause (b).
(b) The Company may make payment of any Defaulted Interest on the
Registered Securities of any series in any other lawful manner not inconsistent
with the requirements of any securities exchange on which such Registered
Securities may be listed, and upon such notice as may be required by such
exchange, if, after notice given by the Company to the Trustee of the proposed
payment pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section 3.07, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry all the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
Section 3.08 Persons Deemed Owners.
The Company, the Trustee and any agent of the Company or the Trustee
may deem and treat the Person in whose name any Registered Security shall be
registered in the Security Register for such series as the absolute owner of
such Registered Security (whether or not such Registered Security shall be
overdue and notwithstanding any notation of ownership or other writing thereon)
for the purpose of receiving payment of or on account of the principal of and,
subject to the provisions of this Indenture, any premium or interest on, such
Registered Security and for all other purposes; and neither the Company nor the
Trustee nor any agent of the Company or the Trustee shall be affected by any
notice to the contrary.
The Company, the Trustee and any agent of the Company or the Trustee
may treat the bearer of any Bearer Security and the bearer of any Coupon as the
absolute owner of such Bearer Security or Coupon for the purpose of receiving
payment thereof or on account thereof and for all other purposes whatsoever,
whether or not such Bearer Security or Coupon be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
All payments so made to any such Person or bearer, or upon his order,
shall be valid and, to the extent of the sum or sums so paid, effectual to
satisfy and discharge the liability for moneys payable upon any such Security.
Section 3.09 Cancellation.
All Securities and Coupons surrendered for the purpose of payment,
redemption, registration of transfer or exchange, or for credit against any
payment in respect of a sinking or analogous fund, if surrendered to the
Company, any Security Registrar, any Paying Agent or any other agent of the
Company or any agent of the Trustee, shall be delivered to the Trustee and
promptly canceled by it or, if surrendered to the Trustee, shall be promptly
canceled by it; and no Securities shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Indenture. The Trustee
shall deliver canceled Securities and Coupons held by it to the Company. If the
Company shall acquire any of the Securities, such acquisition shall not operate
as a redemption or satisfaction of the indebtedness represented by such
Securities unless and until the same are delivered to the Trustee for
cancellation.
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Section 3.10 Computation of Interest.
Except as otherwise specified as contemplated in Section 3.01 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
Section 3.11 Currency and Manner of Payments in Respect of Securities.
(a) Unless otherwise specified with respect to any Securities
pursuant to Section 3.01, with respect to Registered Securities of any series
not permitting the election provided for in paragraph (b) below or the Holders
who have not made the election provided for in paragraph (b) below, and with
respect to Bearer Securities of any series, except as provided in paragraph (d)
below, payment of the principal of (and premium, if any, on) and interest, if
any, on any Registered or Bearer Security of such series will be made in the
Currency in which such Registered Security or Bearer Security, as the case may
be, is payable. The provisions of this Section 3.11 may be modified or
superseded with respect to any Securities pursuant to Section 3.01.
(b) It may be provided pursuant to Section 3.01 with respect to
Registered Securities of any series that Holders shall have the option, subject
to subsections (d) and (e) below, to receive payments of principal of (and
premium, if any, on) or interest, if any, on such Registered Securities in any
Currency which may be designated for such election by delivering to the Trustee
for such series of Registered Securities a written election with signature
guarantees and in the applicable form established pursuant to Section 3.01, not
later than the close of business on the Election Date immediately preceding the
applicable payment date. If a Holder so elects to receive such payments in any
such Currency, such election will remain in effect for such Holder or any
transferee of such Holder until changed by such Holder or such transferee by
written notice to the Trustee for such series of Registered Securities (but any
such notice must be given not later than the close of business on the Election
Date immediately preceding the next payment date to be effective with respect to
the payment to be made on such payment date and no such change of election may
be made with respect to payments to be made on any Registered Security of such
series with respect to which (i) an Event of Default has occurred, (ii) the
Company has deposited funds pursuant to Articles Four or Fourteen, (iii) a
notice of redemption has been given by the Company or (iv) a notice of option to
elect repayment has been given by such Holder or such transferee). Any Holder of
any such Registered Security who shall not have delivered any such election to
the Trustee of such series of Registered Securities prior to the close of
business on the applicable Election Date will be paid the amount due on the
applicable payment date in the relevant Currency as provided in subsection (a)
above. The Trustee for each such series of Registered Securities shall notify
the Exchange Rate Agent as soon as practicable, but not later than two Business
Days after the Election Date of the aggregate principal amount of Registered
Securities for which Holders have made such written election.
(c) Unless otherwise specified pursuant to Section 3.01, if the
election referred to in paragraph (b) above has been provided for pursuant to
Section 3.01, then, not later than the fourth Business Day after the Election
Date for each payment date for Registered Securities of any series, the Exchange
Rate Agent will deliver to the Company a written notice specifying, in the
Currency in which Registered Securities of such series are payable, the
respective aggregate amounts of principal of (and premium, if any, on) and
interest, if any, on the Registered Securities to be paid on such payment date,
specifying the amounts in such Currency so payable in respect of the Registered
Securities as to which the Holders of Registered Securities denominated in any
Currency shall have elected to be paid in another Currency as provided in
paragraph (b) above. If
40
the election referred to in paragraph (b) above has been provided for pursuant
to Section 3.01 and if at least one Holder has made such election, then, unless
otherwise specified pursuant to Section 3.01, on the fifth Business Date
preceding such payment date the Company will deliver to the Trustee for such
series of Registered Securities an Exchange Rate Officer's Certificate in
respect of the Dollar or Foreign Currency payments to be made on such payment
date. Unless otherwise specified pursuant to Section 3.01, the Dollar or Foreign
Currency amount receivable by Holders of Registered Securities who have elected
payment in a Currency as provided in paragraph (b) above shall be determined by
the Company on the basis of the applicable Market Exchange Rate in effect on the
third Business Day (the "Valuation Date") immediately preceding each payment
date, and such determination shall be conclusive and binding for all purposes,
absent manifest error.
(d) If a Conversion Event occurs with respect to a Foreign Currency in
which any of the Securities are denominated or payable other than pursuant to an
election provided for pursuant to paragraph (b) above, then with respect to each
payment date for the payment of principal of (and premium, if any, on) and
interest, if any, on the applicable Securities denominated or payable in such
Foreign Currency occurring after the last date on which such Foreign Currency
was used (the "Conversion Date"), the Dollar shall be the Currency of payment
for use on each such payment date. Unless otherwise specified pursuant to
Section 3.01, the Dollar amount to be paid by the Company to the Trustee or any
Paying Agent to the Holders of such Securities with respect to such payment date
shall be, in the case of a Foreign Currency other than a currency unit, the
Dollar Equivalent of the Foreign Currency or, in the case of a currency unit,
the Dollar Equivalent of the currency unit, in each case as determined by the
Exchange Rate Agent in the manner provided in paragraph (f) or (g) below.
(e) Unless otherwise specified pursuant to Section 3.01, if the
Holder of a Registered Security denominated in any Currency shall have
elected to be paid in another Currency as provided in paragraph (b) above,
and a Conversion Event occurs with respect to such elected Currency, such
Holder shall thereafter receive payment in the Currency in which payment
would have been made in the absence of such election; and if a Conversion
Event occurs with respect to the Currency in which payment would have been
made in the absence of such election, such Holder shall receive payment in
Dollars as provided in subsection (d) above.
(f) The "Dollar Equivalent of the Foreign Currency" shall be
determined by the Exchange Rate Agent and shall be obtained for each
subsequent payment date by converting the specified Foreign Currency into
Dollars at the Market Exchange Rate on the Conversion Date.
(g) The "Dollar Equivalent of the Currency Unit" shall be determined
by the Exchange Rate Agent and subject to the provisions of paragraph (h)
below shall be the sum of each amount obtained by converting the Specified
Amount of each Component Currency into Dollars at the Market Exchange Rate
for such Component Currency on the Valuation Date with respect to each
payment.
(h) For purposes of this Section 3.11 the following terms shall have
the following meanings:
A "Component Currency" shall mean any Currency which, on the
Conversion Date, was a component currency of the relevant currency unit,
including the ECU.
A "Specified Amount" of a Component Currency shall mean the number of
units of such Component Currency or fractions thereof which were represented in
the relevant currency
41
unit, including the ECU, on the Conversion Date. If after the Conversion Date
the official unit of any Component Currency is altered by way of combination or
subdivision, the Specified Amount of such Component Currency of the relevant
currency shall be divided or multiplied in the same proportion. If after the
Conversion Date two or more Component Currencies are consolidated into a single
Currency, the respective Specified Amounts of such Component Currencies shall be
replaced by an amount in such single Currency equal to the sum of the respective
Specified Amounts of such consolidated Component Currencies expressed in such
single Currency, and such amount shall thereafter be a Specified Amount and such
single Currency shall thereafter be a Component Currency. If after the
Conversion Date any Component Currency shall be divided into two or more
Currencies, the Specified Amount of such Component Currency shall be replaced by
amounts of such two or more Currencies, having an aggregate dollar Equivalent
Value at the Market Exchange Rate on the date of such replacement equal to the
Dollar Equivalent of the Specified Amount of such former Component Currency at
the Market Exchange Rate immediately before such division and such amounts shall
thereafter be Specified Amounts and such currencies shall thereafter be
Component Currencies. If, after the Conversion Date of the relevant currency
unit, including the ECU, a Conversion Event (other than any event referred to
above in this definition of "Specified Amount") occurs with respect to any
Component Currency of such currency unit and is continuing on the applicable
Valuation Date, the Specified Amount of such Component Currency shall, for
purposes of calculating the Dollar Equivalent of the Currency Unit, be converted
into Dollars at the Market Exchange Rate in effect on the Conversion Date of
such Component Currency.
"Election Date" shall mean the date for any series of Registered
Securities as specified pursuant to Section 3.01(l) by which the written
election referred to in subsection (b) above may be made.
All decisions and determinations by the Exchange Rate Agent regarding
the Dollar Equivalent of the Foreign Currency, the Dollar Equivalent of the
Currency Unit, the Market Exchange Rate and changes in the Specified Amounts as
specified above shall be in its sole discretion and shall, in the absence of
manifest error, be conclusive for all purposes and irrevocably binding upon the
Company and the Trustee for the appropriate series of Securities and all Holders
of such Securities denominated or payable in the relevant Currency. The
Exchange Rate Agent shall promptly give written notice to the Company and the
Trustee for the appropriate series of Securities of any such decision or
determination.
In the event that the Company determines in good faith that a
Conversion Event has occurred with respect to a Foreign Currency, the Company
will immediately give written notice thereof to the Trustee of the appropriate
series of Securities (including CUSIP Numbers) and to the Exchange Rate Agent
(and such Trustee will promptly thereafter give notice in the manner provided in
Section 1.07 to the affected Holders) specifying the Conversion Date. In the
event the Company so determines that a Conversion Event has occurred with
respect to the ECU or any other currency unit in which Securities are
denominated or payable, the Company will immediately give written notice thereof
to the Trustee of the appropriate series of Securities and to the Exchange Rate
Agent (and such Trustee will promptly thereafter give notice in the manner
provided in Section 1.07 to the affected Holders) specifying the Conversion Date
and the Specified Amount of each Component Currency on the Conversion Date. In
the event the Company determines in good faith that any subsequent change in any
Component Currency as set forth in the definition of Specified Amount above has
occurred, the Company will similarly give written notice to the Trustee of the
appropriate series of Securities and to the Exchange Rate Agent.
42
The Trustee of the appropriate series of Securities shall be fully
justified and protected in relying and acting upon information received by it
from the Company and the Exchange Rate Agent and shall not otherwise have any
duty or obligation to determine the accuracy or validity of such information
independent of the Company or the Exchange Rate Agent.
Section 3.12 Appointment and Resignation of Successor Exchange Rate Agent.
(a) Unless otherwise specified pursuant to Section 3.01, if and so
long as the Securities of any series (i) are denominated in a Currency other
than Dollars or (ii) may be payable in a Currency other than Dollars, or so long
as it is required under any other provision of this Indenture, then the Company
will appoint and maintain with respect to each such series of Securities, or as
so required, at least one Exchange Rate Agent. The Company will cause the
Exchange Rate Agent to make the necessary foreign exchange determinations at the
time and in the manner specified pursuant to Section 3.01 for the purpose of
determining the applicable rate of exchange and, if applicable, for the purpose
of converting the issued Currency into the applicable payment Currency for the
payment of principal (and premium, if any) and interest, if any, pursuant to
Section 3.11.
(b) No resignation of the Exchange Rate Agent and no appointment of a
successor Exchange Rate Agent pursuant to this Section shall become effective
until the acceptance of appointment by the successor Exchange Rate Agent as
evidenced by a written instrument delivered to the Company, with a copy to the
Trustee accepting such appointment executed by the successor Exchange Rate
Agent.
(c) If the Exchange Rate Agent shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of the Exchange
Rate Agent for any cause, with respect to the Securities of one or more series,
the Company, by or pursuant to a Board Resolution, shall promptly appoint a
successor Exchange Rate Agent or Exchange Rate Agents with respect to the
Securities of that or those series (it being understood that any such successor
Exchange Rate Agent may be appointed with respect to the Securities of one or
more or all of such series and that, unless otherwise specified pursuant to
Section 3.01, at any time there shall only be one Exchange Rate Agent with
respect to the Securities of any particular series that are originally issued by
the Company on the same date and that are initially denominated and/or payable
in the same Currency).
Section 3.13 Compliance with Certain Laws and Regulations.
If any Bearer Securities are to be issued in any series of Securities,
the Company will use reasonable efforts to provide for arrangements and
procedures designed pursuant to then applicable laws and regulations, if any, to
ensure that Bearer Securities are sold or resold, exchanged, transferred and
paid only in compliance with such laws and regulations and without adverse
consequences to the Company or the Trustee.
Section 3.14 CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed
43
on the Securities, and any such redemption shall not be affected by any defect
in or omission of such numbers. The Company will promptly notify the Trustee of
any change in the "CUSIP" numbers.
ARTICLE FOUR
Satisfaction and Discharge
Section 4.01 Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Securities herein
expressly provided for), and the Trustee, upon a Company Request and at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(a) either
(1) all Securities theretofore authenticated and delivered and
all Coupons appertaining thereto (other than (i) Securities and Coupons
which have been destroyed, lost or stolen and which have been replaced or
paid as provided in Section 3.06, (ii) Securities and Coupons 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 10.03, (iii) Coupons
appertaining to Bearer Securities surrendered in exchange for Registered
Securities and maturing after such exchange, surrender of which is not
required or has been waived as provided in Section 3.05, and (iv) Coupons
appertaining to Bearer Securities called for redemption and maturing after
the relevant Redemption Date, surrender of which has been waived as
provided in Section 11.06) have been delivered to the Trustee for
cancellation; or
(2) all such Securities, and, in the case of (i) and (ii) below, any
Coupons appertaining thereto, not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year, or
(iii) are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption
by the Trustee in the name, and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) in subclause (2) above, has
irrevocably deposited or caused to be deposited with the applicable Trustee as
trust funds in trust for such purpose an amount in the currency in which such
Securities are denominated sufficient to pay and discharge the entire
indebtedness on such Securities, for principal and any premium and interest to
the date of such deposit (in the case of Securities which have become due and
payable) or to the Stated Maturity or Redemption Date, as the case may be;
provided, however, in the event a petition for relief under the applicable
Federal or state bankruptcy, insolvency or other similar law is filed with
respect to the Company within 123 days after the deposit and the applicable
Trustee is
44
required to return the deposited money to the Company, the
obligations of the Company under this Indenture with respect to such Securities
will not be deemed terminated or discharged;
(b) the Company has paid or caused to be paid all other sums payable
under this Indenture by the Company; and
(c) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.07, the obligations of
the Company to any Authenticating Agent under Section 6.14 and, if money shall
have been deposited with the Trustee pursuant to subclause (2) of clause (a) of
this Section 4.01, the obligations of the Trustee under Sections 3.05, 3.06,
4.02 and 10.02 and the last paragraph of Section 10.03, shall survive.
Section 4.02 Application of Trust Money.
Subject to provisions of the last paragraph of Section 10.03, all
money deposited with the Trustee pursuant to Section 4.01 shall be held in trust
and applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) or Depositary as the
Trustee may determine, to the Holders of the particular Securities of such
series for the payment or redemption of which such money has been deposited with
or received by the Trustee, of all sums due and to become due thereon for
principal and any premium and interest.
ARTICLE FIVE
Remedies
Section 5.01 Events of Default.
"Event of Default", with respect to Securities of a particular series
wherever used herein, means any one of the following events and such other
events as may be established with respect to the Securities of such series as
contemplated in Section 3.01, continued for the period of time, if any, and
after the giving of notice, if any, designated in this Indenture or as may be
established with respect to such Securities as contemplated in Section 3.01, as
the case may be, unless such event is either inapplicable or is specifically
deleted or modified in, or pursuant to, the applicable Board Resolution or in
the supplemental indenture under which such series of Securities is issued, as
the case may be, as contemplated in Section 3.01:
(a) default in the payment of the principal of, or any premium on,
any of the Securities of such series as and when the same shall become due and
payable either at Stated Maturity, upon redemption, by declaration or otherwise;
or
(b) default in the payment of any installment of interest, if any, or
any payment with respect to the Coupons, if any, upon any of the Securities of
such series as and when it shall become due and payable, and continuance of such
default for a period of 30 days; or
(c) default in the deposit of any sinking fund payment, when and as
due and payable by the terms of the Securities of such series; or
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(d) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture with respect to such series or in any
supplemental indenture with respect to such series (other than a covenant or
warranty a default in the performance of which or a breach of which is elsewhere
in this Section 5.01 specifically dealt with or which has expressly been
included in this Indenture and designated as being solely for the benefit of a
series of Securities other than such series), 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 applicable Trustee or to the Company and
the applicable Trustee by the Holders of at least 25% in principal amount of the
Outstanding Securities of such series, a written notice specifying such default
or breach and requiring it to be remedied and stating that such notice is a
"Notice of Default" hereunder; or
(e) a court having jurisdiction in the premises shall enter a decree
or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar
official) of the Company or for all or substantially all of its property or
ordering the winding up or liquidation of its affairs, and such decree or order
shall remain unstayed and in effect for a period of 90 consecutive days; or
(f) the Company shall commence a voluntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law now or hereafter in effect, or consent to the entry of an order for
relief in an involuntary case under any such law, or consent to the appointment
or taking possession by a receiver, liquidator, assignee, custodian, trustee or
sequestrator (or similar official) of the Company or for all or substantially
all of its property, or make any general assignment for the benefit of
creditors, or the admission by the Company in writing of its inability to pay
its debts generally as they become due; or
(g) any other Event of Default provided with respect to Securities of
such series.
Section 5.02 Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any series at the
time Outstanding occurs and is continuing, then, and in each and every such
case, unless the principal of all of the Securities of such series shall have
already become due and payable, either the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities of such
series, by notice in writing to the Company (and to the Trustee if given by
Holders), may declare the entire principal amount (or, if the Securities of such
series are Original Issue Discount Securities, such portion of the principal as
may be specified in the terms of such series) of all of the Securities of such
series and any premium and interest accrued thereon to be due and payable
immediately, and upon any such declaration such principal amount (or specified
amount) and any premium and interest accrued thereon shall become immediately
due and payable.
The foregoing provisions, however, are subject to the condition that
if, at any time after the principal (or, if the Securities are Original Issue
Discount Securities, such portion of the principal as may be specified in the
terms thereof) of the Securities of any series shall have been so declared due
and payable, and before any judgment or decree for the payment of money due
shall have been obtained or entered as hereinafter provided,
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(a) the Company shall pay or shall deposit with the Trustee a sum
sufficient to pay (A) all overdue installments of interest, if any, with
currency in which the Securities of such series are denominated, on all
Securities or all overdue payments with respect to any Coupons of such series,
(B) the principal of (and premium, if any, on) any Securities of such series
which have become due otherwise than by such declaration of acceleration and
interest, if any, thereon at the rate or rates prescribed therefor in such
Securities, (C) to the extent that payment of such interest is lawful, interest
upon overdue installments of interest on each Security of such series or upon
overdue payments on any Coupons of such series at a rate established for such
series, and (D) all sums paid or advanced by the Trustee and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and
(b) all Events of Default under this Indenture with respect to the
Securities of such series other than the nonpayment of the principal of such
Securities which shall have become due by such declaration of acceleration,
shall have been cured, waived or otherwise remedied as provided in Section 5.13,
then and in every such case the Holders of not less than a majority in aggregate
principal amount of the Outstanding Securities of such series, by written notice
to the Company and to the Trustee, may rescind and annul such declaration and
its consequences with respect to such series, but no such rescission and
annulment shall extend to or shall affect any subsequent default or shall impair
any right consequent thereon.
For all purposes under this Indenture, if a portion of the principal
of any Original Issue Discount Securities shall have been accelerated and
declared due and payable pursuant to the provisions hereof, then, from and after
such declaration, unless such declaration has been rescinded and annulled, the
principal amount of such Original Issue Discount Securities shall be deemed, for
all purposes hereunder, to be such portion of the principal thereof as shall be
due and payable as a result of such acceleration, and payment of such portion of
the principal thereof as shall be due and payable as a result of such
acceleration, together with interest, if any, thereon and all other amounts
owing thereunder, shall constitute payment in full of such Original Issue
Discount Securities.
In case the Trustee shall have proceeded to enforce any right under
this Indenture and such proceedings shall have been discontinued or abandoned
because of such rescission or annulment or shall have been determined adversely
to the Trustee, then and in every such case the Company and the Trustee shall be
restored respectively to their former rights and positions thereunder.
Section 5.03 Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(a) default is made in the payment of any installment of interest on
any of the Securities of any series as and when such interest becomes due and
payable, and such default continues for a period of 30 days, or
(b) a default is made in the payment of the principal of, and any
premium on, any of the Securities of any series as and when the same becomes due
and payable, whether upon Stated Maturity of the Securities of such series or
upon redemption or by declaration or otherwise, or
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(c) default is made in the making or satisfaction of any sinking fund
payment or analogous obligation when the same becomes due by the terms of the
Securities of any series,
then the Company will, upon demand of the Trustee, pay to the Trustee for the
benefit of the Holders of the Securities of such series the whole amount then
due and payable on all Securities of such series for principal and any premium
and interest as the case may be (with interest to the date of such payment upon
the overdue principal and, to the extent that payment of such interest is
enforceable under applicable law, on overdue premium and installments of
interest, if any, at the Overdue Rate applicable to Securities of such series);
and in addition thereto, such further amount as shall be sufficient to cover the
costs and expenses of collection, and any further amounts payable to the Trustee
pursuant to Section 6.07.
Until such demand is made by the Trustee, the Company may pay the
principal of and any premium and interest on the Securities of any series to the
registered Holders, whether or not the principal of and any premium and interest
on the Securities of such series be overdue.
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any action or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceedings to judgment or final decree, and may enforce any such
judgment or final decree against the Company or other obligor upon such
Securities and collect in the manner provided by law out of the property of the
Company or other obligor upon such Securities, wherever situated, the moneys
adjudged or decreed to be payable.
If an Event of Default with respect to Securities of any series has
occurred, has not been waived and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities of such series by such appropriate judicial proceedings as
the Trustee shall deem most effectual to protect and enforce any of such rights,
either at law or in equity or in bankruptcy or otherwise, whether for the
specific enforcement of any covenant or agreement contained in this Indenture or
in aid of the exercise of any power granted in this Indenture or to enforce any
other legal or equitable right granted in this Indenture or by law.
Section 5.04 Trustee May File Proofs of Claim.
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor upon the Securities of
any series under Title 11 of the United States Code or any other similar
applicable Federal or State law, or in case a receiver, trustee in bankruptcy or
similar official shall have been appointed for the property of the Company or
such other obligor, or in case of any other similar judicial proceedings
relative to the Company or other obligor upon the Securities of any series, or
to the creditors or property of the Company or such other obligor, the Trustee,
irrespective of whether the principal of any Securities shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand pursuant to the provisions of
this Section, shall be entitled and empowered, by intervention in such
proceedings or otherwise:
(a) to file and prove a claim or claims for the whole amount of
principal (or, if the Securities of any series are Original Issue Discount
Securities, such portion of the principal amount as may be due and payable with
respect to such series pursuant to a declaration in accordance with Section
5.02) and any premium and interest owing and unpaid in respect of the Securities
of any series, and, in case of any judicial proceedings, to file such proofs of
claim and
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other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for any amounts payable to the
Trustee pursuant to Section 6.07) and of the Holders allowed in any judicial
proceedings relating to the Company or other obligor upon the Securities of any
series, or to the creditors or property of the Company or such other obligor;
(b) unless prohibited by applicable law and regulations, to vote on
behalf of the Holders of the Securities of any series in any election of a
trustee or a standby trustee in arrangement, reorganization, liquidation or
other bankruptcy or insolvency proceedings or of a person performing similar
functions in comparable proceedings; and
(c) to collect and receive any money or other property payable or
deliverable on any such claims, and to distribute all amounts received with
respect to the claims of the Holders and of the Trustee on their behalf (after
deduction of costs and expenses of collection, and any further amounts payable
to the Trustee and/or its agents or counsel pursuant to Section 6.07); and any
trustee in bankruptcy, receiver or other similar official is hereby authorized
by each of the Holders to make payments to the Trustee and, in the event that
the Trustee shall consent to the making of payments directly to the Holders, to
pay to the Trustee costs and expenses of collection and any further amounts
payable to the Trustee and/or its agents or counsel pursuant to Section 6.07.
No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Holder any plan or reorganization, arrangement, adjustment or composition
affecting the Securities of any series 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, except, as aforesaid, to vote for the election of a trustee in
bankruptcy or similar person.
Section 5.05 Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture, or under the
Securities of any series, may be prosecuted and enforced by the Trustee without
the possession of any of the Securities of such series 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, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Holders of the Securities in
respect of which such judgment has been recovered.
Section 5.06 Application of Moneys Collected by Trustee.
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 the case of distribution of such money on account of principal or any premium
or interest, upon presentation of the Securities or Coupons in respect of which
money has been collected and stamping (or otherwise noting) thereon the payment,
or issuing Securities in reduced principal amounts in exchange for the presented
Securities of like series and tenor if only partially paid, or upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due to the Trustee (including
the reasonable compensation and expenses of its agents and counsel) under
Section 6.07;
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SECOND: To the Holders of the Securities for amounts due and unpaid
on the Securities for principal, and Premium, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and
payable for principal, and Premium, if any, and interest, respectively;
provided, however, that such payments shall be made subject to the provisions of
Article Fourteen hereunder if applicable; and
THIRD: To the payment of the remainder, if any, to the Company or as
a court of competent jurisdiction may direct.
Section 5.07 Limitation on Suits.
No Holder of any Security of any series shall have any right by virtue
or by availing of any provision of this Indenture to institute any action or
proceeding at law or in equity or in bankruptcy or otherwise upon or under or
with respect to this Indenture, or for the appointment of a trustee in
bankruptcy, receiver or other similar official or for any other remedy
hereunder, unless
(a) such Holder has previously given written notice to the Trustee of
default with respect to Securities of such series and of the continuance
thereof, as hereinbefore provided;
(b) the Holders of not less than 25% in aggregate principal amount of
the Outstanding Securities of such series shall have made written request to the
Trustee to institute such action, suit or proceedings in its own name as Trustee
hereunder;
(c) 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;
(d) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has neglected or refused to institute any such action,
suit or proceeding; and
(e) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period pursuant to Section 5.12;
it being understood and intended, and being expressly covenanted by the taker
and Holder of every Security with every other taker and Holder and the Trustee,
that no one or more Holders of any Securities shall have any right in any manner
whatever by virtue or by availing of any provision of this Indenture to affect,
disturb or prejudice the rights of any other Holder of Securities, or to obtain
or to seek to obtain priority or preference over any other Holder or to enforce
any right under this Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all Holders of Securities. For the
protection and enforcement of the provisions of this Section, each Holder and
the Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section 5.08 Unconditional Right of Holders to Receive Principal, Premium and
Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and any premium and (subject to Section
3.07) any interest on such Security on the Stated Maturity or Maturities
expressed in such Security (or, in the case of redemption, on the Redemption
Date) and to institute suit for the enforcement of any such payment, and such
rights shall not be impaired without the consent of such Holder.
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Section 5.09 Restoration of Rights and Remedies.
In case the Trustee or any Holder shall have proceeded to enforce any
right under this Indenture and such proceedings shall have been discontinued or
abandoned for any reason, or shall have been determined adversely to the Trustee
or to such Holder, then and in every such case the Company, the Trustee and the
Holders shall be restored respectively to their former positions and rights
hereunder, and all rights, remedies and powers of the Company, the Trustee and
the Holders shall continue as though no such proceedings had been taken.
Section 5.10 Rights and Remedies Cumulative.
Except as provided in Section 5.07 and except as otherwise provided
with respect to the replacement or payment of mutilated, destroyed, lost or
stolen Securities in the last paragraph of Section 3.06, 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. 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 5.11 Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder to exercise any
right, power or remedy accruing upon any Event of Default occurring and
continuing as aforesaid shall impair any such right, power or remedy or shall be
construed to be a waiver of any such Event of Default or an acquiescence
therein. Subject to Section 5.07, every power and remedy given by this Indenture
or by law to the Trustee or to the Holders of any or all series, as the case may
be, may be exercised from time to time, and as often as shall be deemed
expedient, by the Trustee or by the Holders of such series or all series, as the
case may be.
Section 5.12 Control by Holders.
The Holders of not less than a majority in aggregate principal amount
of the Outstanding Securities of any series shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the Trustee by this
Indenture with respect to Securities of such series; provided, however, that
(a) such direction shall not be in conflict with any rule of law or
with this Indenture, and
(b) the Trustee (subject to the requirements of the Trust Indenture
Act) shall have the right to decline to follow any such direction if the
Trustee, being advised by counsel, shall determine that the action or proceeding
so directed may not lawfully be taken or if the Trustee shall determine that the
action or proceedings so directed would involve the Trustee in personal
liability or be unduly prejudicial to the Holders not joining therein.
Nothing in this Indenture shall impair the right of the Trustee in its
discretion to take any action deemed proper by the Trustee and which is not
inconsistent with such direction or directions by Holders.
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Section 5.13 Waiver of Past Defaults.
Prior to the declaration of the acceleration of the Maturity of the
Securities of any particular series, the Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities of any series may on
behalf of the Holders of all the Securities of such series waive any past
default or Event of Default with respect to such series and its consequences,
except a default not theretofore cured
(a) in the payment of the principal of or any premium or interest on
any Security of such series, or
(b) in respect of a covenant or provision hereof which cannot be
modified or amended without the consent of the Holder of each Outstanding
Security of such series affected as provided in Section 9.02.
In the case of any such waiver, the Company, the Trustee and the
Holders of the Securities of each series affected shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other default or Event of Default or impair any
right consequent thereon.
Upon any such waiver, such default shall cease to exist and be deemed
to have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured, and not to have occurred 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 5.14 Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereby shall be deemed to have agreed, that 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 (including reasonable legal fees and expenses) and
may assess costs against any such party litigant, in the manner and to the
extent provided in the Trust Indenture Act, having due regard to the merits and
good faith of the claims or defenses made by the party litigant. This Section
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
5.08, a suit by Holders of more than 10% in principal amount of the Securities
of any series or a suit by the Company.
Section 5.15 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 it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
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ARTICLE SIX
The Trustee
Section 6.01 Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default with respect
to any series of Securities,
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture with respect to the
Securities of such series, and no implied covenants or obligations shall be
read into this Indenture against the Trustee or any predecessor Trustee;
and
(2) in the absence of bad faith on its part, the Trustee may,
with respect to Securities of such series, conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions (whether in their original or
facsimile form) furnished to the Trustee and conforming to the requirements
of this Indenture; but in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished to
the Trustee, the Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this Indenture
(but need not confirm or investigate the accuracy of any facts or
mathematical calculations made therein).
(b) In case an Event of Default with respect to any series of
Securities has occurred and is continuing, the Trustee shall exercise with
respect to the Securities of such series 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 man would exercise or use under the circumstances in the
conduct of his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
(1) this subsection (c) shall not be construed to limit the
effect of subsection (a) of this Section 6.01;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved that
the Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in principal amount of the
Outstanding Securities of any series relating to the time, method and place
of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Indenture with respect to the Securities of such series; and
(4) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any
of its rights or powers, if it shall have
53
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section 6.01.
Section 6.02 Notice of Defaults.
The Trustee shall transmit notices of default to the Holders in
accordance with Section 315(b) of the Trust Indenture Act and other provisions
therein related thereto. For the purpose of this Section 6.02, the term
"default" means any event which is, or after notice or lapse of time or both
would become, an Event of Default with respect to Securities of such series;
provided, however, that, except in the case of a default in the payment of the
principal of (or premium, if any, on) or interest, if any, on any Security of
such series or in the payment of any sinking fund installment with respect to
Securities of such series, the Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive committee or a
trust committee of directors or Responsible Officers of the Trustee in good
faith determine that the withholding of such notice is in the interest of the
Holders of Securities of such series.
Section 6.03 Certain Rights of the Trustee.
Subject to the provisions of the Trust Indenture Act:
(a) the Trustee may conclusively rely and shall be protected in
acting or refraining from acting upon any resolution, Officers' Certificate or
any other certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, or other paper or document (whether in its original
or facsimile form) believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by a Company Order or Company Request
(unless other evidence in respect thereof be herein specifically prescribed) 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 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 any nationally recognized counsel
with expertise in trust indenture matters of its selection and any 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 to be taken
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 this Indenture at the request, order or
direction of any of the Holders pursuant to this Indenture, unless such Holders
shall have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance with
such request, order or direction;
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(f) prior to the occurrence of an Event of Default hereunder and after
the curing or waiving of all Events of Default, 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 unless requested in writing to do so by the Holders of not
less than a majority in aggregate principal amount of the Outstanding Securities
of any series affected; 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 not regularly in its employ and the Trustee shall not be responsible
for any misconduct or negligence on the part of any such agent or attorney
appointed with due care by it hereunder; and
(h) the Trustee shall not be liable for any action taken or omitted by
it in good faith and believed by it to be authorized or within the discretion,
rights or powers conferred upon it by this Indenture.
Section 6.04 Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee or any Authenticating Agent assumes no
responsibility for their correctness. The Trustee makes no representation as to
the validity or sufficiency of this Indenture or of the Securities, provided
that the Trustee shall not be relieved of its duty to authenticate Securities
only as authorized by this Indenture. The Trustee or any Authenticating Agent
shall not be accountable for the use or application by the Company of any of the
Securities or the proceeds thereof.
Section 6.05 May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company or the Trustee, in its individual or
any other capacity, may become the owner or pledgee of Securities of any series
with the same rights it would have if it were not the Trustee, Authenticating
Agent, Paying Agent, Security Registrar or such other agent and, subject to the
provisions of the Trust Indenture Act, may otherwise deal with the Company and
receive, collect, hold and retain collections from the Company with the same
rights it would have if it were not the Trustee, Authenticating Agent, Paying
Agent, Security Registrar or such other agent.
Section 6.06 Money Held in Trust.
Subject to the provisions of Section 10.03, all money received by the
Trustee or any Paying Agent, all money and Government Obligations deposited with
the Trustee pursuant to Section 13.02 or Section 13.03 and all money received by
the Trustee in respect of Government Obligations deposited with the Trustee
pursuant to Section 13.02 or Section 13.03, shall, until used or applied as
herein provided, be held in trust for the purposes for which they were received,
but need not be segregated from other funds except to the extent required by
mandatory provisions of law. Neither the Trustee nor any Paying Agent shall be
under any liability for interest on any money received by it hereunder except as
otherwise agreed by the Company. So
55
long as no Event of Default shall have occurred and be continuing, all interest
allowed on any such money shall be paid from time to time in accordance with a
Company Order.
Section 6.07 Compensation and Reimbursement.
The Company covenants and agrees
(a) to pay to the Trustee from time to time as agreed in writing
between the Company and the Trustee, and the Trustee shall be entitled to,
reasonable compensation for all services rendered by it hereunder (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and advances
incurred or made by or on behalf of the Trustee in accordance with any of the
provisions 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 own negligence or bad
faith; and
(c) to indemnify each of the Trustee and any predecessor Trustee for,
and to hold it harmless against, any and all loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in connection
with the acceptance or administration of this Indenture or the 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.
The Trustee shall notify the Company promptly of any claim for which
it may seek indemnity. Failure by the Trustee to so promptly notify the Company,
however, shall not relieve the Company of its obligations under this paragraph
except to the extent such failure shall have materially prejudiced the Company.
The Company may at its option defend the claim and, if it so defends, then the
Trustee shall cooperate in the defense and the Company shall not be responsible
for any expenses of the Trustee's counsel thereafter. The Company need not pay
for any settlement made without its consent.
The obligations of the Company under this Section 6.07 to compensate
and indemnify the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness hereunder
and shall survive the satisfaction and discharge of this Indenture. Such
additional indebtedness shall be secured by a lien prior to that of the
Securities 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
Securities.
When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 5.01(e) or (f), the expenses and
the compensation for the services are intended to constitute expenses of
administration under any bankruptcy law.
Section 6.08 Right to Rely on Officers' Certificate.
Subject to the requirements of the Trust Indenture Act, whenever in
the administration of the trusts of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
suffering or omitting any action to be taken hereunder, such matter (unless
other evidence in respect thereof be herein specifically prescribed) may, in the
absence of actual knowledge to the contrary, willful misconduct or bad faith on
the
56
part of the Trustee, be deemed to be conclusively proved and established by an
Officers' Certificate delivered to the Trustee, and such certificate, in the
absence of actual knowledge to the contrary, willful misconduct or bad faith on
the part of the Trustee, shall be full warrant to the Trustee for any action
taken, suffered or omitted by it under the provisions of this Indenture upon the
faith thereof.
Section 6.09 Eligibility.
The Trustee for each series of Securities hereunder shall at all times
be a Person organized and doing business under the laws of the United States of
America or of any State or the District of Columbia, having a combined capital
and surplus of at least $50,000,000, and eligible under the provisions of the
Trust Indenture Act. If such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such Person at any time shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, the Trustee shall resign
immediately in the manner and with the effect specified in this Article.
Section 6.10 Resignation and Removal; Appointment of Successor.
(a) Any resignation or removal of the Trustee with respect to any
series and any appointment of a successor Trustee with respect to such series
pursuant to any of the provisions of this Section 6.10 shall become effective
upon acceptance of appointment by the successor Trustee as provided in Section
6.11.
(b) The Trustee may resign at any time with respect to one or more or
all series of Securities by giving 60 days written notice of resignation to the
Company. Upon receiving such notice of resignation, the Company shall promptly
appoint a successor Trustee with respect to the applicable series by written
instrument in duplicate, executed by authority of the Board of Directors, one
copy of which instrument shall be delivered to the resigning Trustee and one
copy to the successor Trustee. If no successor Trustee shall have been so
appointed with respect to any series and have accepted appointment within 30
days after the mailing of such notice of resignation, the resigning Trustee may,
at the expense of the Company, petition any court of competent jurisdiction for
the appointment of a successor Trustee, or any Holder who has been a bona fide
Holder of a Security of the applicable series for at least six months may, at
the expense of the Company, subject to the requirements of the Trust Indenture
Act, on behalf of itself and all others similarly situated, petition any such
court for the appointment of a successor Trustee. Such court may thereupon,
after such notice, if any, as it may deem proper and prescribe, appoint a
successor Trustee.
(c) The Holders of a majority in aggregate principal amount of the
Outstanding Securities of any series may at any time remove the Trustee with
respect to Securities of such series and appoint a successor Trustee with
respect to the Securities of such series by delivering to the Trustee so
removed, to the successor Trustee so appointed and to the Company the evidence
provided for in Section 1.04 of the action in that regard taken by the Holders.
(d) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with the provisions of
Section 310(b) of the Trust Indenture Act after written request therefor by
the Company or by any
57
Holder who has been a bona fide Holder of a Security of a relevant series
for at least six months; or
(2) the Trustee shall cease to be eligible in accordance with the
provisions of Section 6.09 with respect to any series of Securities and
shall fail to resign after written request therefor by the Company or by
any Holder who has been a bona fide Holder of a Security of a relevant
series for at least six months; or
(3) the Trustee shall become incapable of acting with respect to
any series of Securities, or shall be adjudged a bankrupt or insolvent, or
a receiver or liquidator 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 may remove the Trustee with respect to
the applicable series of Securities (or all series, if required) and appoint a
successor Trustee for such series by written instrument, in duplicate, executed
by authority of the Board of Directors, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor Trustee, or
(ii) subject to the requirements of the Trust Indenture Act, any Holder who has
been a bona fide Holder of a Security of such series for at least six months may
on behalf of itself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee with respect to such series. Such court may thereupon, after
such notice, if any, as it may deem proper and prescribe, remove the Trustee and
appoint a successor Trustee with respect to such series.
(e) If the Trustee shall resign, be removed or become incapable of
acting with respect to any series of Securities, or if a vacancy shall occur in
the office of the Trustee with respect to any series of Securities for any
cause, the Company, by a Board Resolution, shall promptly appoint a successor
Trustee for that series of Securities. If, within one year after such
resignation, removal or incapacity, or the occurrence of such vacancy, a
successor Trustee with respect to such series of Securities shall be appointed
by the Holders of a majority in principal amount of the Outstanding Securities
of such series by written instrument delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment, become the successor Trustee with respect to such series
and supersede the successor Trustee appointed by the Company with respect to
such series. If no successor Trustee with respect to such series shall have been
so appointed by the Company or the Holders of such series and accepted
appointment in the manner hereinafter provided, subject to Section 5.14, any
Holder who has been a bona fide Holder of a Security of that series for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to such series.
Section 6.11 Acceptance of Appointment by Successor.
Any successor Trustee appointed as provided in Section 6.10 shall
execute, acknowledge and deliver to the Company and to its predecessor Trustee
an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor Trustee with respect to all or any
applicable series shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, duties and obligations with respect to such series of its predecessor
Trustee hereunder, with like effect as if originally named as Trustee for such
series hereunder; but, nevertheless, on the written request of the Company or of
the successor Trustee, upon payment (or due provision therefor) of
58
any amounts then due it pursuant to Section 6.07, the Predecessor Trustee
ceasing to act shall, subject to Section 10.03, pay over to the successor
Trustee all money at the time held by it hereunder and shall execute and deliver
an instrument transferring to such successor Trustee all such rights, powers,
duties and obligations. Upon request of any such successor Trustee, the Company
shall execute any and all instruments in writing for more fully and certainly
vesting in and confirming to such successor Trustee all such rights and powers.
Any Trustee ceasing to act shall, nevertheless, retain a lien upon all property
or funds held or collected by such Trustee to secure any amounts then due it
pursuant to the provisions of Section 6.07.
If a successor Trustee is appointed with respect to the Securities of
one or more (but not all) series, the Company, the predecessor Trustee and each
successor Trustee with respect to the Securities of any applicable series shall
execute and deliver an indenture supplemental hereto which shall contain such
provisions as shall be deemed necessary or desirable to confirm that all the
rights, powers, trusts and duties of the predecessor Trustee with respect to the
Securities of any series as to which the predecessor Trustee is not retiring
shall continue to be vested in the predecessor Trustee, and shall add to or
change any of the provisions of this Indenture as shall be necessary to provide
for or facilitate the administration of the trusts hereunder by more than one
Trustee, it being understood that nothing herein or in such supplemental
indenture shall constitute such Trustees co-trustees of the same trust and that
each such Trustee shall be Trustee of a trust or trusts hereunder separate and
apart from any trust or trusts hereunder administered by any other such Trustee.
No successor Trustee with respect to any series of Securities shall
accept appointment as provided in this Section unless at the time of such
acceptance such successor Trustee shall, with respect to such series, be
qualified under the requirements of the Trust Indenture Act and eligible under
the provisions of Section 6.09.
Upon acceptance of appointment by any successor Trustee as provided in
this Section 6.11, the Company shall give notice thereof to the Holders of
Securities of any series for which such successor Trustee is acting as Trustee
in the manner provided for notices to the Holders of Securities in Section 1.06.
If the Company fails to give such notice within ten days after acceptance of
appointment by the successor Trustee, the successor Trustee shall cause such
notice to be given at the expense of the Company.
Section 6.12 Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Trustee may be merged or converted or with
which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided that
such Person shall be qualified under the requirements of the Trust Indenture Act
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, anything herein to the
contrary notwithstanding.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Securities of any series shall have
been authenticated but not delivered, any such successor to the Trustee by
merger, conversion or consolidation may adopt the certificate of authentication
of any predecessor Trustee and deliver such Securities so authenticated; and, in
case at that time any of the Securities of any series shall not have been
authenticated, any successor to the Trustee may authenticate such Securities
either in the name of such successor to the Trustee or, if such successor to the
Trustee is a successor by merger,
59
conversion or consolidation, in the name of any predecessor hereunder; provided,
however, that such successor shall use the predecessor's name only in such
circumstances set forth in this Section 6.12 and in all such cases such
certificate shall have the full force which it is anywhere in the Securities of
such series or in this Indenture provided that the certificate of the Trustee
shall have.
Section 6.13 Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of Sections 311(a) and 311(b) of the Trust Indenture Act regarding
the collection of claims against the Company (or any such other obligor).
Section 6.14 Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect
to one or more series of Securities which shall be authorized to act on behalf
of the Trustee to authenticate Securities of such series issued upon original
issue and upon exchange, registration of transfer or partial redemption thereof
or pursuant to Section 3.06, and Securities so authenticated shall be entitled
to the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not 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 such supervising or examining authority, then
for the purposes of this Section 6.14, 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 6.14, such Authenticating Agent shall resign
immediately in the manner and with the effect specified in this Section 6.14.
Any Person into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which such Authenticating Agent shall be
a party, or any Person succeeding to the corporate agency or corporate trust
business of an Authenticating Agent, shall continue to be an Authenticating
Agent, provided such Person shall be otherwise eligible under this Section 6.14,
without the execution or filing of any paper or any further act on the part of
the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and 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 6.14, the Trustee may appoint a successor
Authenticating Agent which shall be
60
acceptable to the Company and shall give notice of such appointment to all
Holders of Securities of the series with respect to which such Authenticating
Agent will serve in the manner set forth in Section 1.06. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless eligible under the provisions of
this Section 6.14.
The Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section 6.14.
If an appointment with respect to one or more series is made pursuant
to this Section 6.14, the Securities of such series 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 Securities of the series designated therein and
referred to in the within-mentioned Indenture.
The Bank of New York,
as Trustee
By:
------------------------------------
As Authenticating Agent
By:
------------------------------------
Authorized Signatory
ARTICLE SEVEN
Holders' List and Reports by Trustee and Company
Section 7.01 Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not later than 15 days after each Record Date for
the Securities of any series (and on dates as specified as contemplated in
Section 3.01 for any series of Original Issue Discount Securities which by their
terms bear interest only after Maturity), a list, in such form as the Trustee
may reasonably require, of the names and addresses of the Holders of the
Securities of such series as of each such Record Date (and as of dates as
specified as contemplated in Section 3.01 of this Indenture), and
(b) at such other times as the Trustee may request in writing, within
15 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 is
furnished;
provided, however, that if and so long as the Trustee shall be the Security
Registrar for Securities of a series, no such list need be furnished with
respect to such series of Securities.
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Section 7.02 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 7.01 and the names and
addresses of Registered Holders received by the Trustee in its capacity as
Security Registrar. The Trustee may destroy any list furnished to it as provided
in Section 7.01 upon receipt of a new list so furnished.
(b) The rights of the Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either 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 7.03 Reports by Trustee.
(a) Within 60 days after each May 15, beginning with the May following
the date of this Indenture, and in any event prior to July 15 in each year, so
long as any Securities are Outstanding hereunder, the Trustee shall transmit by
mail to Holders of Securities of any series such reports concerning the Trustee
and its actions under this Indenture as may be required pursuant to the Trust
Indenture Act, including Section 313 thereof, 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
Securities of such series are listed, with the Commission and also with the
Company. The Company will promptly notify the Trustee when any series of
Securities are listed on any stock exchange or automatic quotation series or
delisted therefrom.
Section 7.04 Reports by Company.
The Company will:
(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 said 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 required 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
62
covenants of this Indenture as may be required from time to time by such rules
and regulations; and
(c) transmit to all Holders of Securities, in the manner and to the
extent provided in Section 7.03, 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 paragraphs (a) and (b) of this Section
7.04 as may be required by rules and regulations prescribed from time to time by
the Commission.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 8.01 Company May Consolidate, Etc., Only on Certain Terms.
Nothing contained in this Indenture or in any of the Securities shall
prevent any consolidation or merger of the Company with or into any other Person
(whether or not affiliated with the Company), or successive consolidations or
mergers in which the Company or its successor or successors shall be a party or
parties, or shall prevent any conveyance, transfer or lease of all or
substantially all the property or assets of the Company, to any other Person
(whether or not affiliated with the Company) authorized to acquire and operate
the same; provided, however, and the Company hereby covenants and agrees, that
upon any such consolidation, merger, transfer, conveyance or lease:
(a) the resulting, surviving or transferee Person (the "Successor
Company") shall be a Person organized and existing under the laws of the United
States of America, any State thereof or the District of Columbia and the
Successor Company (if not the Company) shall expressly assume, by an indenture
supplemental hereto, executed and delivered to a Responsible Officer of the
Trustee, in form satisfactory to the Trustee, all the obligations of the Company
under the Securities and this Indenture;
(b) immediately after giving effect to such transaction (and treating
any Indebtedness which becomes an obligation of the Successor Company or any
Subsidiary as a result of such transaction as having been Incurred by the
Successor Company or such Subsidiary at the time of such transaction), no
Default shall have occurred and be continuing;
(c) immediately after giving effect to such transaction, the Successor
Company would be able to incur an additional $1.00 of Indebtedness pursuant to
Section 10.04(a);
(d) immediately after giving effect to such transaction, the Successor
Company shall have Consolidated Net Worth in an amount which is not less than
the Consolidated Net Worth of the Company immediately prior to such transaction;
and
(e) the Trustee, subject to the requirements of the Trust Indenture
Act and Section 6.03, shall receive an Opinion of Counsel and Officers'
Certificate from the Company
63
stating that such consolidation, merger, conveyance, transfer or lease and any
supplemental indenture comply with the provisions of this Article and that all
conditions precedent herein provided for relating to such transaction have been
complied with.
Notwithstanding the foregoing clauses (b), (c) and (d), any Restricted
Subsidiary may consolidate with, merge into or transfer all or part of its
properties and assets to the Company.
Section 8.02 Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of all or
substantially all the property or assets of the Company in accordance with
Section 8.01, the Successor Company 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 Company had been named as the Company
herein, and thereafter, except in the case of a lease of all or substantially
all of its assets, the predecessor Person shall be relieved of all obligations
and covenants under this Indenture and the Securities.
In case of any such consolidation, merger, conveyance, transfer or
lease, such changes in phraseology and form (but not in substance) may be made
in the Securities thereafter to be issued as may be appropriate.
ARTICLE NINE
Supplemental Indentures
Section 9.01 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:
(a) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants, agreements and
obligations of the Company contained herein and in the Securities; or
(b) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be for
the benefit of less than all series of Securities, stating that such covenants
are expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company; or
(c) to add any additional Events of Default (and if such Events of
Default are to be applicable to less than all series, stating that such Events
of Default are expressly being included solely to be applicable to such series);
or
(d) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities; provided, however,
that any such addition, change or elimination (i) shall neither (A) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (B) modify the
64
rights of the Holder of any such Security with respect to such provision or (ii)
shall become effective only when there is no such Security Outstanding; or
(e) to convey, transfer, assign, mortgage or pledge to the Trustee as
security for the Securities of one or more series any property or assets; or
(f) to establish the form or terms of Securities of any series as
permitted by Sections 2.01 and 3.01; or
(g) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or more
series and to add to or change any of the provisions of this Indenture as shall
be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the requirements of Section
6.11; or
(h) to cure any ambiguity, to correct or supplement any provision
herein or in any supplemental indenture which may be defective or inconsistent
with any other provision contained herein or in any supplemental indenture; or
to change or eliminate any provision or to make any other provisions with
respect to matters or questions arising under this Indenture or under any
supplemental indenture as the Company may deem necessary or desirable; provided,
however, that such action shall not adversely affect the interests of the
Holders of the Outstanding Securities of any series.
Section 9.02 Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities of each series affected
by such supplemental indenture (each such series voting as a single class), by
act of such 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 any supplemental indenture or of modifying in any manner the rights and
obligations of the Company and the rights of the Holders of the Securities of
such series under this Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Security
affected thereby,
(a) change the Stated Maturity of the principal of, or any installment
of principal of or interest on, any Security, or reduce the principal amount
thereof, or reduce any premium thereof or change the time of payment of any
premium thereon, or reduce the rate or change the time of payment of interest
thereon, if any, or reduce any amount payable on redemption or reduce the
Overdue Rate thereof or make the principal thereof or any premium or interest
thereon, payable at any place of payment or in any Currency other than as
provided in the Security or reduce the amount of the principal of an Original
Issue Discount Security that would be due and payable upon an acceleration of
the Maturity thereof pursuant to Section 5.02 or the amount thereof provable in
bankruptcy pursuant to Section 5.04, or impair, if the Securities provide
therefor, any right of repayment at the option of the Holder, or impair the
right to institute a suit for the enforcement of any payment on or with respect
to any Security pursuant to Section 5.07; or
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(b) reduce the aforesaid percentage of Outstanding Securities the
consent of the Holders of which is required for any such supplemental indenture
or for waiver of compliance with certain provisions of the Indenture or for
waiver of certain defaults.
A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture which has expressly been included solely for
the benefit of one or more particular series of Securities, or which modifies
the rights of the Holders of Securities of such series with respect to such
covenant or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series. The preceding
sentence shall not, however, raise any inference as to whether or not a
particular series is affected by any supplemental indenture not referred to in
such sentence.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section 9.02, the
Company shall give notice thereof to the Holders of Securities of each series
affected thereby in the manner provided for notices to the Holders of Securities
in Section 1.06, setting forth in general terms the substance of such
supplemental indenture. Any failure of the Company to give such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any such supplemental indenture.
Section 9.03 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 6.01) shall be fully protected in conclusively 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.
Section 9.04 Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitations of rights, obligations, duties
and immunities under this Indenture of the Trustee, the Company and the Holders
of Securities of each series affected thereby shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such modifications
and amendments, and any such supplemental indenture shall form a part of this
Indenture for all purposes and every Holder of Securities theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.
Section 9.05 Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as in effect at the date
such supplemental indenture is executed.
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Section 9.06 Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may bear a
notation in form approved by the Trustee for such series as to any matter
provided for by such supplemental indenture. If the Company or the Trustee shall
so determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company, and, upon a Company Request,
authenticated and delivered by the Trustee in exchange for the Outstanding
Securities of such series.
ARTICLE TEN
Covenants
Section 10.01 Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay or cause to be paid the
principal of, and any premium and interest on, the Securities of that series in
accordance with the terms of the Securities and this Indenture.
Section 10.02 Maintenance of Office or Agency.
The Company will designate and maintain in the Borough of Manhattan,
the City of New York, for any series of Securities an office or agency where
Securities of that series may be presented or surrendered for payment (the
"Paying Agent"), where Securities of that series may be surrendered for
registration of transfer or exchange, where notices and demands to or upon the
Company in respect of the Securities of that series and this Indenture may be
served. The Company may have one or more Paying Agents. The Company or any of
its domestic Subsidiaries may act as Paying Agent. The Company will give prompt
written notice to a Responsible Officer of 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, and the
Company hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies where the Securities of one or more series may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations. The Company will 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.
Section 10.03 Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of or any premium or interest on any of the Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal or any premium or interest so becoming due
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
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Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, prior to each due date of the principal of and
any premium or interest on any Securities of that series, deposit with a Paying
Agent a sum sufficient to pay the principal and any premium or interest so
becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal, premium or interest, and (unless such Paying Agent
is the Trustee) the Company will promptly notify the Trustee of its action or
failure so to act.
The Company will cause each Paying Agent 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
(a) hold all sums held by it for the payment of the principal of and
any premium or interest on the Securities of that series in trust for the
benefit of the Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided;
(b) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities of that series) in the making of any payment
of the principal of or any premium or interest on the Securities of that series;
and
(c) at any time during the continuance of any such default referred to
in clause (2) above, upon the written request of the Trustee, forthwith pay to
the Trustee all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same 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.
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 and any premium or
interest on any Security of any series and remaining unclaimed for two years
after such principal and any premium or interest 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 Security
shall thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in an Authorized Newspaper in
the City of New York or other place of payment, 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, any unclaimed balance of such money
then remaining will be repaid to the Company.
Section 10.04 Limitation on Indebtedness.
(a) The Company shall not Incur, directly or indirectly, any
Indebtedness if, on the date of such Incurrence and after giving effect thereto,
the Consolidated Leverage Ratio exceeds 2.5 to 1.0.
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(b) Notwithstanding Section 10.04(a), the Company may Incur any or all
of the following Indebtedness:
(1) Permitted Warehouse Indebtedness;
(2) Indebtedness owed to and held by the Company or a
Consolidated Restricted Subsidiary; provided, however, that any subsequent
issuance or transfer of any Capital Stock which results in any such
Consolidated Restricted Subsidiary ceasing to be a Consolidated Restricted
Subsidiary or any subsequent transfer of such Indebtedness (other than to
the Company or another Consolidated Restricted Subsidiary) shall be deemed,
in each case, to constitute the Incurrence of such Indebtedness by the
Company;
(3) with respect to any series of Securities, the Securities of
such series and all Securities of any prior series Outstanding as of the
Issue Date of such series of Securities;
(4) Indebtedness outstanding on the Issue Date of a series of
Securities (other than Indebtedness described in clause (1), (2) or (3) of
this Section 10.04(b));
(5) Refinancing Indebtedness in respect of Indebtedness Incurred
pursuant to Section 10.04(a) or pursuant to clause (3) or (4) or this
clause (5) of this Section 10.04(b);
(6) Hedging Obligations directly related to: (i) Indebtedness
Incurred (or reasonably expected to be Incurred) and permitted to be
Incurred by the Company or the Restricted Subsidiaries pursuant to this
Indenture; (ii) Receivables held by the Company or its Restricted
Subsidiaries pending sale or securitization; (iii) Receivables of the
Company or its Restricted Subsidiaries that are subject to a Warehouse
Facility; (iv) Receivables with respect to which the Company reasonably
expects to purchase or commit to purchase, finance or accept as collateral;
or (v) Excess Spread Receivables and other assets owned or financed by the
Company or its Restricted Subsidiaries in the ordinary course of business;
provided, however, that such Hedging Obligations are eligible to receive
hedge accounting treatment in accordance with GAAP as applied by the
Company as of the Issue Date of a series of Securities; and
(7) Indebtedness in an aggregate principal amount which, together
with the principal amount of all other Indebtedness of the Company
outstanding on the date of such Incurrence (other than Indebtedness
permitted by clauses (1) through (6) of this Section 10.04(b) or Section
10.04(a)) does not exceed $40.0 million.
(c) Notwithstanding Section 10.04(a) and Section 10.04(b), the Company
shall not Incur any Indebtedness if the proceeds thereof are used, directly or
indirectly, to Refinance any Subordinated Obligations unless such Indebtedness
shall be subordinated to the Securities to at least the same extent as such
Subordinated Obligations.
(d) For purposes of determining compliance with this Section 10.04, in
the event that an item of Indebtedness meets the criteria of more than one of
the types of Indebtedness described above, the Company, in its sole discretion,
may (i) classify such item of Indebtedness and only be required to include the
amount and type of such Indebtedness in one of the above
69
clauses or (ii) divide and classify such item of Indebtedness in more than one
of the types of Indebtedness described in this Section 10.04.
Section 10.05 Limitation on Indebtedness and Preferred Stock of Restricted
Subsidiaries.
The Company shall not permit any Restricted Subsidiary to Incur,
directly or indirectly, any Indebtedness or Preferred Stock except:
(a) Permitted Warehouse Indebtedness;
(b) Warehouse Margin Indebtedness; provided that such Warehouse Margin
Indebtedness has remained unpaid for five or fewer Business Days; provided,
further, however, that the amount of such Warehouse Margin Indebtedness, when
taken together with the aggregate amount of all other Warehouse Margin
Indebtedness Incurred pursuant to this clause (b) and outstanding on the date of
such Incurrence, does not exceed 5% of Consolidated Net Worth;
(c) Indebtedness or Preferred Stock issued to and held by the Company
or a Consolidated Restricted Subsidiary; provided, however, that any subsequent
issuance or transfer of any Capital Stock which results in any such Consolidated
Restricted Subsidiary ceasing to be a Consolidated Restricted Subsidiary or any
subsequent transfer of such Indebtedness or Preferred Stock (other than to the
Company or a Consolidated Restricted Subsidiary) shall be deemed, in each case,
to constitute the Incurrence such Indebtedness or Preferred Stock by the issuer
thereof;
(d) Indebtedness or Preferred Stock of a Subsidiary Incurred and
outstanding on or prior to the date on which such Subsidiary was acquired by the
Company (other than Indebtedness or Preferred Stock Incurred in connection with,
or to provide all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant to which
such Subsidiary became a Subsidiary or was acquired by the Company); provided,
however, that on the date of such acquisition and after giving effect thereto,
the Company would have been able to Incur at least $1.00 of Indebtedness
pursuant to Section 10.04(a);
(e) Indebtedness or Preferred Stock outstanding on the Issue Date of a
series of Securities (other than Indebtedness described in clause (a), (b), (c)
or (d) of this Section 10.05); and
(f) Refinancing Indebtedness Incurred in respect of Indebtedness or
Preferred Stock referred to in clause (d) or (e) of this Section 10.05 or this
clause (f); provided, however, that to the extent such Refinancing Indebtedness
directly or indirectly Refinances Indebtedness or Preferred Stock of a
Subsidiary described in clause (d) of this Section 10.05, such Refinancing
Indebtedness shall be Incurred only by such Subsidiary.
Section 10.06 Limitation on Restricted Payments.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary, directly or indirectly, to make a Restricted Payment if at the time
the Company or such Restricted Subsidiary makes such Restricted Payment: (i) a
Default shall have occurred and be continuing (or would result therefrom); (ii)
the Company is not able to Incur an additional $1.00 of Indebtedness pursuant to
Section 10.04(a); or (iii) the aggregate amount of such Restricted Payment and
all other Restricted Payments since March 12, 1997 would exceed the sum of: (A)
25% of the Consolidated Net Income accrued during the period (treated as one
accounting period)
70
from January 1, 1997 to the end of the most recent fiscal quarter prior to the
date of such Restricted Payment for which financial statements are available
(or, in case such Consolidated Net Income shall be a deficit, minus 100% of such
deficit); (B) the aggregate Net Cash Proceeds received by the Company from the
issuance or sale of its Capital Stock (other than Disqualified Stock) subsequent
to January 1, 1997 (other than an issuance or sale to a Subsidiary of the
Company and other than an issuance or sale to an employee stock ownership plan
or to a trust established by the Company or any of its Subsidiaries for the
benefit of their employees); (C) the amount by which Indebtedness of the Company
is reduced on the Company's balance sheet upon the conversion or exchange (other
than by a Subsidiary of the Company) subsequent to March 12, 1997, of any
Indebtedness of the Company convertible or exchangeable for Capital Stock (other
than Disqualified Stock) of the Company (less the amount of any cash, or the
fair value of any other property, distributed by the Company upon such
conversion or exchange); (D) an amount equal to the sum of (i) the net reduction
in Investments in any Person resulting from dividends or repayments of loans or
advances, in each case to the Company or any Restricted Subsidiary from such
Person, and (ii) the portion (proportionate to the Company's equity interest in
such Subsidiary) of the fair market value of the net assets of an Unrestricted
Subsidiary at the time such Unrestricted Subsidiary is designated a Restricted
Subsidiary; provided, however, that the foregoing sum in this clause (D) shall
not exceed, in the case of any Person, the amount of Investments made since
March 12, 1997 by the Company or any Restricted Subsidiary in such Person and
treated as a Restricted Payment; and (E) $15 million.
(b) The provisions of Section 10.06(a) shall not prohibit: (i) any
purchase or redemption of Capital Stock or Subordinated Obligations of the
Company made by exchange for, or out of the proceeds of the substantially
concurrent sale of, Capital Stock of the Company (other than Disqualified Stock
and other than Capital Stock issued or sold to a Subsidiary of the Company or an
employee stock ownership plan or to a trust established by the Company or any of
its Subsidiaries for the benefit of their employees); provided, however, that
(A) such purchase or redemption shall be excluded in the calculation of the
amount of Restricted Payments and (B) the Net Cash Proceeds from such sale shall
be excluded from the calculation of amounts under clause (iii)(B) of Section
10.06(a); (ii) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Obligations made by exchange
for, or out of the proceeds of the substantially concurrent sale of,
Indebtedness of the Company which is permitted to be Incurred pursuant to
Section 10.04; provided, however, that such purchase, repurchase, redemption,
defeasance or other acquisition or retirement for value shall be excluded in the
calculation of the amount of Restricted Payments; (iii) any purchase or
redemption of Subordinated Obligations from Net Available Cash to the extent
permitted under Section 10.08; provided, however, that such purchase or
redemption shall be excluded in the calculation of the amount of Restricted
Payments; (iv) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividend would have complied with
this Section 10.06; provided, however, that at the time of payment of such
dividend, no other Default shall have occurred and be continuing (or result
therefrom); provided, further, however, that such dividend shall be included in
the calculation of the amount of Restricted Payments; (v) any purchase of
Capital Stock of the Company made from time to time to meet the Company's
obligations under its employee stock ownership and option plans; provided,
however, that such purchase shall be excluded in the calculation of the amount
of Restricted Payments; (vi) the exercise or conversion of an option, warrant or
other security convertible or exchangeable for an equity security of a Strategic
Alliance Client in connection with a substantially simultaneous sale or other
disposition by the Company or a Restricted Subsidiary of such equity security;
provided, however, that the exercise price or other consideration paid by the
Company or a Restricted Subsidiary in connection with such exercise or
conversion shall be excluded from the calculation of the amount of Restricted
Payments; and (vii) the making of an Investment by the Company or a Restricted
71
Subsidiary in another Person to the extent that the amount of such Investment,
when added together with the aggregate amount of all other Investments made
pursuant to this clause (vii) and then outstanding, does not exceed 10% of
Consolidated Net Tangible Assets; provided, however, that such Person's primary
business is a Related Business; provided, further, however, that (I) at the time
of such Investment, no Default shall have occurred and be continuing and (II)
the amount of such Investment shall be included in the calculation of the amount
of Restricted Payments.
Section 10.07 Limitation on Restrictions on Distributions from Restricted
Subsidiaries.
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create or otherwise cause or permit to exist or
become effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary (a) to pay dividends or make any other distributions on
its Capital Stock to the Company or a Restricted Subsidiary or pay any
Indebtedness owed to the Company, (b) to make any loans or advances to the
Company or (c) transfer any of its property or assets to the Company, except:
(i) with respect to any series of Securities, any encumbrance or restriction
pursuant to an agreement in effect at or entered into on the Issue Date with
respect to such series; (ii) any encumbrance or restriction with respect to a
Restricted Subsidiary pursuant to an agreement applicable to such Restricted
Subsidiary on or prior to the date on which such Restricted Subsidiary was
acquired by the Company (other than an agreement entered into in connection
with, or in anticipation of, the transaction or series of related transactions
pursuant to which such Restricted Subsidiary became a Restricted Subsidiary or
was acquired by the Company) and outstanding on such date; (iii) any encumbrance
or restriction with respect to a Restricted Subsidiary pursuant to any other
agreement contained in any amendment to an agreement referred to in clause (i)
or (ii) of this Section 10.07 or this clause (iii); provided, however, that the
encumbrances and restrictions with respect to such Restricted Subsidiary
contained in any such agreement or amendment are no less favorable to the
Holders of Securities than encumbrances and restrictions with respect to such
Restricted Subsidiary contained in the agreements referred to in clauses (i) or
(ii) of this Section 10.07, as the case may be; (iv) any such encumbrance or
restriction consisting of customary non-assignment provisions in leases
governing leasehold interests to the extent such provisions restrict the
transfer of the lease or the property leased thereunder; (v) in the case of
clause (c) above, restrictions contained in security agreements or mortgages
securing Indebtedness of a Restricted Subsidiary to the extent such restrictions
restrict the transfer of the property subject to such security agreements or
mortgages; and (vi) any restriction with respect to a Restricted Subsidiary
imposed pursuant to an agreement entered into for the sale or disposition of all
or substantially all the Capital Stock or assets of such Restricted Subsidiary
pending the closing of such sale or disposition.
Section 10.08 Limitation on Sales of Assets and Subsidiary Stock.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, consummate any Asset Disposition unless
(i) the Company or such Restricted Subsidiary receives consideration at the time
of such Asset Disposition at least equal to the fair market value (including as
to the value of all non-cash consideration), as determined in good faith by the
Board of Directors, of the shares and assets subject to such Asset Disposition
and at least 85% of the consideration thereof received by the Company or such
Restricted Subsidiary is in the form of cash or cash equivalents; (ii) an amount
equal to 100% of the Net Available Cash from such Asset Disposition is applied
by the Company (or such Restricted Subsidiary, as the case may be) (A) first, to
the extent the Company elects, either to (x) acquire Additional Assets, either
directly or through a Restricted Subsidiary, or (y) prepay, repay, redeem
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or purchase Senior Indebtedness of the Company or any Indebtedness of a
Restricted Subsidiary, as the case may be (other than in either case
Indebtedness owed to the Company or an Affiliate of the Company), in either case
within 180 days from the later of the date of such Asset Disposition or the
receipt of such Net Available Cash; (B) second, to the extent of the balance of
such Net Available Cash after application in accordance with clause (A), to make
an offer to the Holders of a series of Securities (and to Holders of other
Indebtedness which ranks pari passu with such series of Securities designated by
the Company) to purchase Securities of such series (and such other pari passu
Indebtedness) pursuant to and subject to the conditions contained in this
Section 10.08; and (C) third, to the extent of the balance of such Net Available
Cash after application in accordance with clauses (A) and (B) to (x) the
acquisition by the Company or any Restricted Subsidiary of Additional Assets or
(y) the prepayment, repayment or purchase of Indebtedness (other than any
Disqualified Stock) of the Company (other than Indebtedness owed to an Affiliate
of the Company), in each case within 180 days from the later of the receipt of
such Net Available Cash and the date the offer described in Section 10.08(b) is
consummated; provided, however, that in connection with any prepayment,
repayment or purchase of Indebtedness pursuant to clause (A), (B) or (C) above,
the Company or such Restricted Subsidiary shall retire such Indebtedness and
shall cause the related loan commitment (if any) to be permanently reduced in an
amount equal to the principal amount so prepaid, repaid or purchased; and (iii)
at the time of such Asset Disposition no Default shall have occurred and be
continuing (or would result therefrom). Notwithstanding the foregoing provisions
of this Section 10.08(a), the Company and the Restricted Subsidiaries shall not
be required to apply any Net Available Cash in accordance with this Section
10.08(a) except to the extent that the aggregate Net Available Cash from all
Asset Dispositions which is not applied in accordance with this Section 10.08(a)
exceeds $10 million. Pending application of Net Available Cash pursuant to this
Section 10.08(a), such Net Available Cash shall be invested in Temporary Cash
Investments.
For the purposes of this Section 10.08(a), the following are deemed to
be cash or cash equivalents: (x) the assumption of Indebtedness of the Company
or any Restricted Subsidiary, and the release of the Company and its continuing
Restricted Subsidiaries from all liability on such Indebtedness, in connection
with such Asset Disposition and (y) securities received by the Company or any
Restricted Subsidiary from the transferee that are promptly converted by the
Company or such Restricted Subsidiary into cash.
(b) In the event of an Asset Disposition that requires the purchase
of the Securities of a series (and other pari passu Indebtedness) pursuant to
Section 10.08(a)(ii)(B) above, the Company will be required to purchase
Securities of such series tendered pursuant to an offer (the "Offer") by the
Company for such Securities (and other pari passu Indebtedness) at a purchase
price of 100% of their principal amount (without premium) plus accrued but
unpaid interest (or, in respect of such other pari passu Indebtedness, such
lesser price, if any, as may be provided for by the terms of such pari passu
Indebtedness) in accordance with the procedures (including prorating in the
event of oversubscription) set forth in this Section 10.08. If the aggregate
purchase price of Securities of such series (and any other pari passu
Indebtedness) tendered pursuant to such offer is less than the Net Available
Cash allotted to the purchase thereof, the Company will be required to apply the
remaining Net Available Cash in accordance with Section 10.08(a)(ii)(C). The
Company shall not be required to make such an offer to purchase Securities (and
other pari passu Indebtedness) pursuant to this Section 10.08 if the Net
Available Cash available therefor is less than $10 million (which lesser amount
shall be carried forward for purposes of determining whether such an offer is
required with respect to any subsequent Asset Disposition).
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(c)(1) Promptly, and in any event within 10 days after the Company
becomes obligated to make an Offer to Holders of Securities of a series, the
Company shall be obligated to deliver to the Trustee and send, by first-class
mail to each Holder of Securities of such series, a written notice stating that
such Holder may elect to have his Securities of such series purchased by the
Company either in whole or in part (subject to prorationing as hereinafter
described in the event the Offer is oversubscribed) in integral multiples of
$1,000 of principal amount, at the applicable purchase price. The notice shall
specify a purchase date not less than 30 days nor more than 60 days after the
date of such notice (the "Purchase Date") and shall contain such information
concerning the business of the Company which the Company in good faith believes
will enable such Holders to make an informed decision (which at a minimum will
include (i) the most recently filed Annual Report on Form 10-K (including
audited consolidated financial statements) of the Company, the most recent
subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form
8-K of the Company filed subsequent to such Quarterly Report, other than Current
Reports describing Asset Dispositions otherwise described in the offering
materials (or corresponding successor reports), (ii) a description of material
developments in the Company's business subsequent to the date of the latest of
such Reports, and (iii) if material, appropriate pro forma financial
information) and all instructions and materials necessary to tender such
Securities pursuant to the Offer, together with the information contained in
clause (3).
(2) Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided below, the Company shall deliver to the
Trustee for the applicable series an Officers' Certificate as to (i) the amount
of the Offer (the "Offer Amount"), (ii) the allocation of the Net Available Cash
from the Asset Dispositions pursuant to which such Offer is being made and (iii)
the compliance of such allocation with the provisions of Section 10.08(a). On
such date, the Company shall also irrevocably deposit with the Trustee or with a
Paying Agent for such series (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust) in cash an amount equal to the Offer Amount
to be held for payment in accordance with the provisions of this Section. Upon
the expiration of the period for which the Offer remains open (the "Offer
Period"), the Company shall deliver to the Trustee for cancellation the
Securities of such series or portions thereof which have been properly tendered
to and are to be accepted by the Company. The Trustee shall, on the Purchase
Date, mail or deliver payment to each tendering Holder in the amount of the
purchase price. In the event that the aggregate purchase price of the Securities
of such series delivered by the Company to the Trustee is less than the Offer
Amount, the Trustee shall deliver the excess to the Company immediately after
the expiration of the Offer Period for application in accordance with this
Section.
(3) Holders electing to have a Security purchased will be required to
surrender the Security, with an appropriate form duly completed, to the
Company at the address specified in the notice at least three Business Days
prior to the Purchase Date. Holders will be entitled to withdraw their
election if the Trustee or the Company receives not later than one Business
Day prior to the Purchase Date, a facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Security which
was delivered by the Holder for purchase by the Company and a statement
that such Holder is withdrawing his election to have such Security
purchased. If at the expiration of the Offer Period the aggregate
principal amount of Securities surrendered by Holders exceeds the Offer
Amount, the Company shall select the Securities to be purchased on a pro
rata basis (with such adjustments as may be deemed appropriate by the
Company).
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Holders whose Securities are purchased only in part will be issued new
Securities equal in principal amount to the unpurchased portion of the
Securities surrendered.
(4) At the time the Company delivers Securities to the Trustee
which are to be accepted for purchase, the Company will also deliver an
Officers' Certificate stating that such Securities are to be accepted by
the Company pursuant to and in accordance with the terms of this Section
and confirming that the Company has complied with all the provisions of
this Section 10.08. A Security shall be deemed to have been accepted for
purchase at the time the Trustee, directly or through an agent, mails or
delivers payment therefor to the surrendering Holder.
(d) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section 10.08. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 10.08, the Company shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section by virtue thereof.
Section 10.09 Limitation on Affiliate Transactions.
(a) The Company shall not, and shall not permit any Restricted Subsidiary
to, enter into or permit to exist any transaction (including the purchase, sale,
lease or exchange of any property, employee compensation arrangements or the
rendering of any service) with any Affiliate of the Company (an "Affiliate
Transaction") unless the terms thereof (1) are no less favorable to the Company
or such Restricted Subsidiary than those that could be obtained at the time of
such transaction in arm's-length dealings with a Person who is not such an
Affiliate, (2) if such Affiliate Transaction involves an amount in excess of
$2.0 million, (i) are set forth in writing and (ii) have been approved by a
majority of the members of the Board of Directors having no personal stake in
such Affiliate Transaction and (3) if such Affiliate Transaction involves an
amount in excess of $10.0 million, have been determined by a nationally
recognized investment banking firm to be fair, from a financial standpoint, to
the Company and its Restricted Subsidiaries.
(b) The provisions of Section 10.09(a) shall not prohibit (i) any
Permitted Investment or any Restricted Payment permitted to be made pursuant to
Section 10.06, (ii) any issuance of securities, or other payments, awards or
grants in cash, securities or otherwise pursuant to, or the funding of,
employment arrangements, stock options and stock ownership plans approved by the
Board of Directors, (iii) the grant of stock options or similar rights to
employees and directors of the Company pursuant to plans approved by the Board
of Directors, (iv) loans or advances to employees in the ordinary course of
business in accordance with the past practices of the Company or its Restricted
Subsidiaries, but in any event not to exceed $10 million in aggregate principal
amount outstanding at any one time, (v) the payment of reasonable fees to
directors of the Company and its Restricted Subsidiaries who are not employees
of the Company or its Restricted Subsidiaries, (vi) any Affiliate Transaction
between the Company and a Consolidated Restricted Subsidiary or between
Consolidated Restricted Subsidiaries and (vii) with respect to any series of
Securities transactions pursuant to any agreement as in existence as of the
Issue Date of such series between the Company or its Restricted Subsidiaries and
Continental Grain or one of its Subsidiaries.
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Section 10.10 Change of Control.
(a) Upon a Change of Control, each Holder shall have the right to
require that the Company repurchase such Holder's Securities at a purchase price
in cash equal to 100% of the principal amount thereof plus accrued and unpaid
interest, if any, to the date of purchase (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
interest payment date), in accordance with the terms contemplated in Section
10.10(b).
(b) Within 30 days following any Change of Control, the Company shall
mail a notice to each Holder with a copy to the Trustee stating:
(1) that a Change of Control has occurred and that such Holder
has the right to require the Company to purchase such Holder's Securities
at a purchase price in cash equal to 100% of the principal amount thereof
plus accrued and unpaid interest, if any, to the date of purchase (subject
to the right of Holders of record on the relevant record date to receive
interest on the relevant interest payment date);
(2) the circumstances and relevant facts regarding such Change
of Control (including information with respect to pro forma results of
operations, cash flow and capitalization after giving effect to such Change
of Control);
(3) the repurchase date (which shall be no earlier than 30 days
nor later than 60 days from the date such notice is mailed); and
(4) the instructions determined by the Company, consistent with
this Section 10.10, that a Holder must follow in order to have its
Securities purchased.
(c) Holders electing to have a Security purchased will be required to
surrender the Security, with an appropriate form duly completed, to the
Company at the address specified in the notice at least three Business Days
prior to the purchase date. Holders will be entitled to withdraw their
election if the Trustee or the Company receives not later than one Business
Day prior to the purchase date, a facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Security which
was delivered by the Holder for purchase by the Company and a statement
that such Holder is withdrawing his election to have such Security
purchased.
(d) On the purchase date, all Securities purchased by the Company
under this Section shall be delivered by the Trustee for cancellation, and the
Company shall pay the purchase price plus accrued and unpaid interest, if any,
to the Holders entitled thereto.
(e) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section 10.10. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section, the Company shall comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations under this Section 10.10 by virtue thereof.
Section 10.11 Limitation on Liens.
With respect to any series of Securities, the Company shall not, and
shall not permit any Restricted Subsidiary to, directly or indirectly, Incur or
permit to exist any Lien of any
76
nature whatsoever on any of its properties (including Capital Stock of a
Restricted Subsidiary), whether owned at the Issue Date of such series or
thereafter acquired, other than Permitted Liens, without effectively providing
that the Securities of such series shall be secured equally and ratably with (or
prior to) the obligations so secured for so long as such obligations are so
secured.
Section 10.12 Limitation on Investment Company Status.
The Company shall not take any action, or otherwise permit to exist
any circumstance, that would require the Company to register as an "investment
company" under the Investment Company Act of 1940, as amended.
Section 10.13 SEC Reports.
Notwithstanding that the Company may not be required to remain subject
to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the
Company shall file with the SEC and provide the Trustee with such annual reports
and such information, documents and other reports as are specified in Sections
13 and 15(d) of the Exchange Act and applicable to a U.S. corporation subject to
such Sections, such information, documents and other reports to be so filed and
provided at the time specified for the filing of such information, documents and
reports under such Sections. The Company also shall comply with the other
provisions of Section 314(a) of the Trust Indenture Act. Delivery of such
reports, information and documents to the Trustee is for informational purposes
only and the Trustee's receipt of such shall not constitute constructive notice
of any information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).
Section 10.14 Certificate of Compliance.
The Company shall deliver a certificate of compliance of the Company
to the Trustee within 120 days after the end of each fiscal year pursuant to
section 314(a)(4) of the Trust Indenture Act, stating, as to each signer
thereof, that,
(a) a review of the activities of the Company during such year and of
the performance under this Indenture has been made under such signer's
supervision, and
(b) to the best of such signer's knowledge, based on such review, the
Company has fulfilled all its obligations under this Indenture throughout such
year, or, if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such signer and the nature and status
thereof.
Section 10.15 Certain Covenants Suspended.
The covenants set forth above in this Article Ten will be applicable
to the Company, except that in the event that at any time (i) the ratings
assigned to a particular series of the Securities by either of the Rating
Agencies are Investment Grade Ratings and (ii) no Default has occurred and is
continuing under this Indenture with respect to such series, the Company and its
Restricted Subsidiaries will no longer be subject to the provisions of Sections
10.04, 10.05, 10.06, 10.07, 10.08, 10.09, and 10.11 and clause (iii) of Section
8.01 (the permanent termination of such Sections being herein called the
"Covenant Termination"). The Company will deliver to the Trustee an Officers'
Certificate confirming the occurrence of the Covenant Termination.
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Section 10.16 Calculation of Original Issue Discount.
To the extent applicable, the Company shall file with the Trustee
promptly at the end of each calendar year (i) a written notice specifying the
amount of original issue discount (including daily rates and accrual periods)
accrued on Outstanding Securities as of the end of such year and (ii) such other
specific information relating to such original issue discount as may then be
relevant under the Internal Revenue Code of 1986, as amended from time to time.
ARTICLE ELEVEN
Redemption of Securities
Section 11.01 Applicability of Article.
------------------------
Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified as contemplated in Section 3.01 for Securities of any
series) in accordance with this Article.
Section 11.02 Election to Redeem; Notice to Trustee.
-------------------------------------
The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution. In case of the redemption at the election of
the Company of the Securities of any series, the Company shall, at least 60 days
prior to the Redemption Date fixed by the Company (unless a shorter notice shall
be satisfactory to the Trustee), notify the Trustee of such Redemption Date, of
the principal amount of Securities of such series to be redeemed at the
Redemption Price and, if applicable, of the tenor of the Securities to be
redeemed. In the case of any redemption of Securities prior to the expiration of
any restriction on such redemption provided in the terms of such Securities or
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction.
Section 11.03 Selection by Trustee of Securities to Be Redeemed.
-------------------------------------------------
If less than all the Securities of any series are to be redeemed
(unless all of the Securities of such series and of a specified tenor are to be
redeemed), the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to the minimum authorized
denomination for Securities of that series or any integral multiple thereof) of
the principal amount of Securities of such series of a denomination larger than
the minimum authorized denomination for Securities of that series. If less than
all of the Securities of such series and of a specified tenor are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series and specified tenor not previously called for
redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Securities selected
for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities
78
redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
Section 11.04 Notice of Redemption.
--------------------
Notice of redemption shall be given in the manner provided in Section
1.06 not less than 30 nor more than 60 days prior to the Redemption Date, unless
a shorter period is specified in the Securities to be redeemed, to each Holder
of Securities to be redeemed.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all the Outstanding Securities of any series are to
be redeemed, the identification (and, in the case of partial redemption of any
Securities, the principal amounts) of the particular Securities to be redeemed;
(d) that on the Redemption Date the Redemption Price
will become due and payable upon each such Security to be redeemed and, if
applicable, that, unless the Company defaults in making such redemption
payment, interest thereon, if any, or in the case of Original Issue
Discount Securities, the original issue discount, shall cease to accrue on
and after such date;
(e) the place or places where such Securities are to
be surrendered for payment of the Redemption Price;
(f) that the redemption is for a sinking fund, if such is the case;
(g) the applicable CUSIP Numbers.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at Company Request, by the Trustee
in the name and at the expense of the Company.
Section 11.05 Deposit of Redemption Price.
---------------------------
On or prior to 10:00 A.M. New York City time on any Redemption Date,
the Company shall deposit in immediately available funds 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 10.03 and as required by the
Trust Indenture Act) an amount of money (in the currency or units of currency in
which the Securities so called for redemption are denominated or an appropriate
equivalent thereof) sufficient to pay the Redemption Price of, and (except if
the Redemption Date shall be an Interest Payment Date) accrued interest on, all
the Securities which are to be redeemed on that date.
Section 11.06 Securities Payable on Redemption Date.
-------------------------------------
Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment
79
of the Redemption Price and accrued interest) such Securities shall cease to
bear interest. On presentation and surrender of such Securities for redemption
in accordance with such notice, such Securities shall be paid and redeemed by
the Company at the Redemption Price, together with accrued interest to the
Redemption Date; provided, however, that, unless otherwise specified as
contemplated in Section 3.01, installments of interest whose Stated Maturity is
on or prior to the Redemption Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such at the
close of business on the relevant Record Dates according to their terms and the
provisions of Section 3.07.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal thereof so to be redeemed shall,
until paid, bear interest from the Redemption Date at the Overdue Rate
applicable to such Security. The Company shall be responsible for the payment,
if any, of the Overdue Rate.
Section 11.07 Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered
at the place specified in the notice of redemption (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer in
form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or his attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Security or Securities of the same series
and of like tenor, of any authorized denomination as requested by such Holder,
in aggregate principal amount equal to and in exchange for the unredeemed
portion of the principal of the Security so surrendered.
ARTICLE TWELVE
Sinking Funds
Section 12.01 Applicability of Article.
Securities of any series which are subject to a sinking fund for the
retirement of Securities of a series shall be subject to such sinking fund in
accordance with their terms and (except as otherwise specified as contemplated
in Section 3.01 for Securities of such series) in accordance with this Article.
The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment", and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Securities of any series,
the cash amount of any sinking fund payment may be subject to reduction as
provided in Section 12.02. Each sinking fund payment shall be applied to the
redemption of Securities of any series as provided for by the terms of
Securities of such series.
Section 12.02 Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a series (other
than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities in satisfaction of all or any part of any sinking fund payment with
respect to the
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Securities of such series required to be made pursuant to the terms of such
Securities as provided for by the terms of such series; provided, however, that
such Securities have not been previously so credited. Such Securities shall be
received and credited for such purpose by the Trustee at the Redemption Price
specified in such Securities for redemption through operation of the sinking
fund and the amount of such sinking fund payment shall be reduced accordingly.
Section 12.03 Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for any
series of Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment for
that series pursuant to the terms of that series, the portion thereof, if any,
which is to be satisfied by payment of cash and the portion thereof, if any,
which is to be satisfied by delivering and crediting Securities of that series
pursuant to Section 12.02 and will also deliver to the Trustee any Securities to
be so delivered. Not less than 30 days before each such sinking fund payment
date the Trustee shall select the Securities to be redeemed upon such sinking
fund payment date in the manner specified in Section 11.03 and cause notice of
the redemption thereof to be given in the name of and at the expense of the
Company in the manner provided in Section 11.04. Such notice having been duly
given, the redemption of such Securities shall be made upon the terms and in the
manner stated in Sections 11.06 and 11.07.
ARTICLE THIRTEEN
Defeasance
Section 13.01 Applicability of Article; Company's Option to Effect Defeasance or
Covenant Defeasance.
If pursuant to Section 3.01 provision is made for either or both of
(1) defeasance of the Securities of a series under Section 13.02 or (2) covenant
defeasance of the Securities of a series under Section 13.03, then the
provisions of such Section or Sections, as the case may be, together with the
other provisions of this Article, shall be applicable to the Securities of such
series, and the Company may at its option by or pursuant to a Board Resolution,
at any time, with respect to the Securities of such series, elect to have either
Section 13.02 (if applicable) or Section 13.03 (if applicable) be applied to the
Outstanding Securities of such series upon compliance with the conditions set
forth below in this Article.
Section 13.02 Defeasance and Discharge.
Upon the Company's exercise of the option provided in Section 13.01 to
have this Section 13.02 applied to the Outstanding Securities of a defeasible
series, the Company shall be deemed to have been discharged from its obligations
with respect to the Outstanding Securities of such series on the date the
conditions set forth in Section 13.04 are satisfied (hereinafter, "defeasance").
For this purpose, such defeasance means that the Company shall be deemed to have
paid and discharged the entire indebtedness represented by the Outstanding
Securities of such series and to have satisfied all its other obligations under
such Securities and this Indenture insofar as such Securities 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 Securities of such series to receive, solely from the trust fund
described in Section 13.04 and as more fully set forth in such Section, payments
in respect of the principal of and any premium or interest on such Securities
when such payments are due, (2) the Company's
81
obligations with respect to such Securities under Sections 3.04, 3.05, 3.06,
10.02 and 10.03 and, with respect to the Trustee, under Section 6.07, (3) the
rights, powers, trusts, duties, and immunities of the Trustee under Sections
3.04, 3.05, 3.06, 3.08, 3.09, 5.06 and 10.03, and otherwise the duty of the
Trustee to authenticate Securities of such series issued on registration of
transfer or exchange and (4) this Article. Subject to compliance with this
Article, the Company may exercise its option provided in Section 13.01 to have
this Section 13.02 applied to the Outstanding Securities of any defeasible
series notwithstanding the prior exercise of its option provided in Section
13.01 to have Section 13.03 applied to the Outstanding Securities of such
series.
Section 13.03 Covenant Defeasance.
Upon the Company's exercise of the option provided in Section 13.01 to
have this Section 13.03 applied to the Outstanding Securities of any defeasible
series, the Company shall be released from (i) in the case of Senior Securities
of any series, its obligations under Sections 10.04, 10.05, 10.06, 10.07, 10.08,
10.09, 10.10, 10.11 and 10.12 hereof or (ii) in the case of Senior Securities or
Subordinated Securities of any series, its obligations with respect to any other
restrictive covenant with respect to the Outstanding Securities of such series
on and after the date the conditions set forth in Section 13.04 are satisfied
(hereinafter, "covenant defeasance"). For this purpose, such covenant defeasance
means that, with respect to the Outstanding Securities of such series, 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 such other
covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such Section or such other covenant to any other provision herein
or in any other document and such omission to comply shall not constitute an
Event of Default under Section 5.01(d) or 5.01(g) (except to the extent
covenants or agreements referenced in such Sections remain applicable) but,
except as specified above, the remainder of this Indenture and such Securities
shall be unaffected thereby. Notwithstanding the foregoing, if the Company
exercises its covenant defeasance option and an Event of Default under the
provisions of this Indenture relating to certain events of bankruptcy or
insolvency or event which with the giving of notice or lapse of time, or both,
would become an Event of Default under such bankruptcy or insolvency provisions
shall have occurred and be continuing on the 123rd day after the date of the
deposit of funds with the Trustee pursuant to Section 13.04(a) below, the
obligations of the Company referred to under the definition of covenant
defeasance with respect to such Securities shall be reinstated in full.
Section 13.04 Conditions to Defeasance or Covenant Defeasance.
Except as expressly provided below, the following shall be the
conditions to application of either Section 13.02 or Section 13.03 to the
Outstanding Securities of such series:
(a) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another Trustee satisfying the requirements of
Section 6.09 who shall agree to comply with the provisions of this Article
applicable to it) 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 Securities, (A) money in an amount, or
(B) Government Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide, not
later than one day before the due date of any payment, money in an amount, or
(C) a combination thereof, sufficient without reinvestment, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and discharge,
and which shall be applied by the Trustee (or other qualifying Trustee) to pay
and discharge, (i) the principal of and
82
any premium on and each installment of principal of and any premium and interest
on the Outstanding Securities of such series on the Stated Maturity of such
principal or installment of principal or interest and (ii) any mandatory sinking
fund payments or analogous payments applicable to the Outstanding Securities of
such series on the day on which such payments are due and payable in accordance
with the terms of this Indenture and of such Securities. For this purpose,
"Government Obligations" means securities that are (x) direct obligations of the
United States of America or, if specified as contemplated in Section 3.01, the
government which issued the currency in which the Securities of such series are
payable, for the payment of which its full faith and credit is pledged or (y)
obligations of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America or, if specified as contemplated
in Section 3.01, such government which issued the currency in which the
Securities of such series are payable, the payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of America
or such other government, which, in either case, are not callable or redeemable
at the option of the obligor thereof, and shall also include a depository
receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act of
1933, as amended) as custodian with respect to any such Government Obligation or
a specific payment of principal of or interest on any such Government Obligation
held by such custodian for the account of the holder of such depository receipt;
provided, however, that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the holder of such
depository receipt from any amount received by the custodian in respect of the
Government Obligation or the specific payment of principal of or interest on the
Government Obligation evidenced by such depository receipt;
(b) No Event of Default or event which, with notice or lapse of time
or both, would become an Event of Default with respect to the Securities of such
series shall have occurred and be continuing on the date of such deposit and in
the case of an election under Section 13.02 only, no Event of Default under the
provisions herein relating to certain events of bankruptcy or insolvency
provisions shall have occurred and be continuing on the 123rd day after such
date;
(c) Such defeasance or covenant defeasance shall not cause the Trustee
for the Securities of such series to have a conflicting interest for purposes of
the Trust Indenture Act with respect to any securities of the Company;
(d) Such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a default under, this Indenture or any
other agreement or instrument to which the Company is a party or by which it is
bound;
(e) In the case of an election under Section 13.02, the Company shall
have delivered to the Trustee an Opinion of Counsel stating that (i) the Company
has received from, or there has been published by, the Internal Revenue Service
a ruling, or (ii) since the date of execution 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 shall confirm that, the Holders of such
Outstanding Securities will not recognize income, gain or loss for Federal
income tax purposes as a result of such 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 defeasance had not occurred;
(f) Such defeasance or covenant defeasance shall not cause any
Securities of such series then listed on any registered national securities
exchange under the Securities Exchange Act of 1934, as amended, to be delisted;
83
(g) Such defeasance or covenant defeasance shall be effected in
compliance with any additional terms, conditions or limitations which may be
imposed on the Company in connection therewith pursuant to Section 3.01; and
(h) 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 defeasance under Section 13.02 or
the covenant defeasance under Section 13.03 (as the case may be) have been
complied with.
Section 13.05 Deposited Money and Government Obligations to Be Held in Trust;
Other Miscellaneous Provisions.
Subject to the provisions of Section 10.03, all money and Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying Trustee--collectively, for purposes of this Section 13.05, the
"Trustee") pursuant to Section 13.04 in respect of the Outstanding Securities of
such series shall be held in trust and applied by the Trustee, in accordance
with the provisions of such Securities and this Indenture, to the payment,
either directly or through a Paying Agent (including the Company acting as its
own Paying Agent) as the Trustee may determine, to the Holders of such
Securities, of all sums due and to become due thereon in respect of principal
and any premium and interest, but such money need not be segregated from other
funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the Government Obligations
deposited pursuant to Section 13.04 or the principal and any premium and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the Outstanding
Securities of such series.
Anything in this Article to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request any
money or Government Obligations held by it as provided in Section 13.04 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 defeasance or covenant defeasance.
Section 13.06 Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or
Government Obligations in accordance with this Article by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's obligations under this Indenture and each series of Securities shall
be revived and reinstated as though no deposit had occurred pursuant to this
Article until such time as the Trustee or the Paying Agent is permitted to apply
all such money or Governmental Obligations in accordance with this Article;
provided, however, that, if the Company has made any payment of interest on or
principal of any series of Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such series of Securities to receive such payment from the money or Government
Obligations held by the Trustee or the Paying Agent.
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ARTICLE FOURTEEN
Subordination
Section 14.01 Agreement to Subordinate.
The Company covenants and agrees, and each Holder of a Subordinated
Security issued hereunder, by his acceptance thereof, likewise covenants and
agrees, that all Subordinated Securities shall be issued subject to the
provisions of this Article; and each Person holding any Subordinated Security,
whether upon original issue or upon transfer, assignment or exchange thereof,
accepts and agrees that the principal of and interest (and premium, if any) on
all Subordinated Securities issued hereunder shall, to the extent and in the
manner herein set forth, be subordinated and subject in right of payment to the
prior payment in full of all Senior Indebtedness, and that the subordination is
for the benefit of the holders of the Senior Indebtedness.
Section 14.02 Payments to Holders of Subordinated Securities.
In the event of (i) any insolvency or bankruptcy case or proceeding,
or any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, relative to the Company or to its creditors,
as such, or to its assets; or (ii) any liquidation, dissolution or other winding
up of the Company, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy; or (iii) any assignment for the benefit of creditors
or any other marshalling of assets or liabilities of the Company, then and in
any such event specified in clause (i), clause (ii) or clause (iii) above (each
such event, if any, herein sometimes referred to as a "Proceeding"):
(a) the holders of Senior Indebtedness will be entitled to receive
payment of such Senior Indebtedness in full (including interest accrued
subsequent to the commencement of any Proceeding) before the Holders of
Subordinated Securities are entitled to receive any payment or distribution of
cash, securities or other property with respect to the principal of, premium,
(if any), or interest on or other obligations in respect of the Subordinated
Securities, or on account of any purchase or other acquisition of Subordinated
Securities by the Company (all such payments, distributions, purchases and
acquisitions herein referred to, individually and collectively, as a
"Subordinated Securities Payment"), and to that end the holders of Senior
Indebtedness of the Company shall be entitled to receive, for application to the
payment thereof, any Subordinated Securities Payment which may be payable or
deliverable in respect of the Subordinated Securities in any such Proceeding;
and
(b) until the Senior Indebtedness is paid in full (including interest
accrued subsequent to the commencement of any Proceeding), any Subordinated
Securities Payment to which Holders of Subordinated Securities would be entitled
but for this Article Fourteen will be made to Holders of such Senior
Indebtedness as their interests may appear. If a Subordinated Securities Payment
is made to holders of Subordinated Securities that, due to this Article Fourteen
should not have been made to them, such Holders of Subordinated Securities are
required to hold it in trust for the holders of Senior Indebtedness and pay it
over to them as their interests may appear.
In the event that, notwithstanding the foregoing provisions of this
Section 14.02, the Trustee, in respect of a series of Subordinated Securities,
receives payment or distribution of assets of the Company of any kind or
character, before all the Senior Indebtedness of the
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Company is paid in full, then and in such event, such Subordinated Securities
Payment shall be paid over or delivered forthwith to the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee, agent or other person making
payment or distribution of assets of the Company for application to the payment
of all Senior Indebtedness of the Company remaining unpaid, to the extent
necessary to pay the Senior Indebtedness of the Company in full, after giving
effect to any concurrent payment or distribution to or for the holders of Senior
Indebtedness of the Company.
The consolidation of the Company with, or the merger of the Company
into, another person or the liquidation or dissolution of the Company following
the conveyance or transfer of all or substantially all of its properties and
assets as an entirety to another person upon the terms and conditions set forth
in Article Eight shall not be deemed a Proceeding for the purposes of this
Section 14.02 if the person formed by such consolidation or into which the
Company is merged or the person which acquires by conveyance or transfer such
properties and assets as an entirety, as the case may be, shall, as part of such
consolidation, merger, conveyance or transfer, comply with the conditions set
forth in Article Eight.
Section 14.03 No Payment When Designated Senior Debt in Default.
The Company will not make any Subordinated Securities Payment or make
any deposit pursuant to the provisions described under Article Thirteen hereof
if (i) any Designated Senior Debt is not paid when due (after giving effect to
any applicable grace periods) or (ii) any other default on Designated Senior
Debt occurs and the maturity of such Designated Senior Debt is accelerated in
accordance with its terms unless, in either case, the default has been cured or
waived or has ceased to exist and any such acceleration has been rescinded or
such Designated Senior Debt has been discharged or paid in full.
Notwithstanding the foregoing, the Company may make any Subordinated Securities
Payment if the Company and the Trustee receive written notice approving such
payment from the representative of the Designated Senior Debt with respect to
which either of the events set forth in clause (i) or (ii) of the immediately
preceding sentence has occurred and is continuing.
In the event that, notwithstanding the foregoing, the Company shall
make any Subordinated Securities Payment to the Trustee or any Holder prohibited
by the foregoing provisions of this Section 14.03, then and in such event, such
Subordinated Securities Payment shall be paid over and delivered forthwith to
the holders of the Senior Indebtedness of the Company remaining unpaid, to the
extent necessary to pay in full all the Senior Indebtedness of the Company.
If payment of the Securities is accelerated because of an Event of
Default, the Company or the Trustee shall promptly notify the holders of
Designated Senior Debt or the representative of such holders of the
acceleration.
The provisions of this Section 14.03 shall not apply to any
Subordinated Securities Payment with respect to which Section 14.02 would be
applicable.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing provisions of this Section
14.03, shall be received by the Trustee, in respect of a series of Subordinated
Securities, under this Indenture or the Holders of the Subordinated Securities
before all Senior Indebtedness is paid in full or provision is made for such
payment in accordance with its terms, and if such fact shall, at or prior to the
time of such payment or
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distribution, have been actually known to the Trustee, then such payment or
distribution shall be held in trust for the benefit of and shall be paid over or
delivered to the representative of the holders of such Senior Indebtedness, or
to the trustee or trustees under any indenture pursuant to which any instruments
evidencing any of such Senior Indebtedness may have been issued, as their
respective interest may appear, for application to the payment of all Senior
Indebtedness remaining unpaid until all such Senior Indebtedness shall have been
paid in full in accordance with its distribution to or for the holders of such
Senior Indebtedness.
For purposes of this Article only, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of arrangement, reorganization or readjustment, the
payment of which is subordinated (at least to the extent provided in this
Article with respect to the Subordinated Securities) to the payment of all
Senior Indebtedness which may at the time be outstanding; provided that (i) the
Senior Indebtedness is assumed by the new corporation, if any, resulting from
any such arrangement, reorganization or readjustment, and (ii) the rights of the
holders of the Senior Indebtedness are not, without the consent of such holders,
altered by such arrangement, reorganization or readjustment. The consolidation
of the Company with, or the merger of the Company with or into, another
corporation or the liquidation or dissolution of the Company following the
conveyance or transfer of all or substantially all of its assets to another
corporation upon the terms and conditions provided in Article Eight shall not be
deemed a dissolution, winding-up, liquidation or reorganization for the purposes
of this Section 14.03 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the conditions stated
in Article Eight. Nothing in this Section shall apply to claims of, or payments
to, the Trustee under or pursuant to Article Six, except as expressly provided
therein. This Section 14.03 shall be subject to the further provisions of
Section 14.06.
Section 14.04 Subrogation.
Subject to the payment in full of all Senior Indebtedness, the Holders
of the Subordinated Securities subject to the provisions of Sections 14.02 and
14.03 shall be subrogated (equally and ratably with the holders of all
obligations of the Company which by their express terms are subordinated to
Senior Indebtedness of the Company to the same extent as the Subordinated
Securities are subordinated and which are entitled to like rights of
subrogation) to the rights of the holders of Senior Indebtedness to receive
payments or distributions of cash, property or securities of the Company
applicable to the Senior Indebtedness until the principal of and interest on
such Subordinated Securities shall be paid in full; and for the purpose of such
subrogation, no payments of distributions to the holders of the Senior
Indebtedness of any cash, property or securities to which the Holders of such
Subordinated Securities or the Trustee on their behalf would be entitled except
for the provisions of this Article, and no payment over pursuant to the
provisions of this Article to the holders of Senior Indebtedness by Holders of
such Subordinated Securities or the Trustee on their behalf shall, as between
the Company, its creditors other than holders of Senior Indebtedness and the
Holders of such Subordinated Securities, be deemed to be a payment by the
Company to or on account of the Senior Indebtedness; and no payments or
distributions of cash, property or securities to or for the benefit of the
Holders pursuant to the subrogation provision of this Article, which would
otherwise have been paid to the holders of Senior Indebtedness, shall be deemed
to be a payment by the Company to or for the account of such Securities. The
provisions of this Article are intended solely for the purpose of defining the
relative rights of the Holders of the Securities, on the one hand, and the
holders of the Senior Indebtedness, on the other hand.
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Nothing contained in this Article or elsewhere in this Indenture or in
the Subordinated Securities is intended to or shall impair, as between the
Company, its creditors other than the holders of Senior Indebtedness, and the
Holders of the Subordinated Securities, the obligation of the Company, which is
absolute and unconditional, to pay to the Holders of the Subordinated Securities
the principal of and interest on the Subordinated Securities and the amounts
owed as and when the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights against the Company
of the Holders of the Subordinated Securities and creditors of the Company other
than the holders of Senior Indebtedness, nor shall anything herein or therein
prevent the Holder of any Subordinated Security or the Trustee on his behalf
from exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article of the
holders of Senior Indebtedness in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee, subject to the provisions of Sections 6.01 and
6.03, and the Holders of the Subordinated Securities shall be entitled to rely
upon any order or decree made by any court of competent jurisdiction in which
such insolvency, bankruptcy, dissolution, winding-up, liquidation, arrangement
or reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidating trustee, agent or other Person making such
payment or distribution, delivered to the Trustee or to the Holders of the
Subordinated Securities for the purpose of ascertaining the Persons entitled to
participate in such distribution, the holders of the Senior Indebtedness and
other indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article.
Section 14.05 Authorization by Holders of Subordinated Securities.
Each Holder of a Subordinated Security by his acceptance thereof
authorizes the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes.
Section 14.06 Notice to Trustee.
The Company shall give prompt written notice to the Trustee and to any
Paying Agent of any fact known to the Company which would prohibit the making of
any payment of moneys to or by the Trustee or any paying agent in respect of any
series of Subordinated Securities pursuant to the provisions of this Article.
Regardless of anything to the contrary contained in this Article or elsewhere in
this Indenture, the Trustee shall not be charged with knowledge of the existence
of any Senior Indebtedness or of any default or event of default with respect to
any Senior Indebtedness or of any other facts which would prohibit the making of
any payment of moneys to or by the Trustee in respect of any series of
Subordinated Securities unless and until a Responsible Officer of the Trustee
shall have received notice in writing at its Corporate Trust Office to that
effect signed by an officer of the Company, or by a holder or agent of a holder
of Senior Indebtedness who shall have been certified by the Company or otherwise
established to the reasonable satisfaction of the Trustee to be such holder or
agent, or by the trustee under any indenture pursuant to which Senior
Indebtedness shall be outstanding, and, prior to the receipt of any such written
notice, the Trustee shall, subject to Sections 6.01 and 6.03, be entitled to
assume that no such facts exist; provided, that if on a date at least two
Business Days prior to the date upon which by the terms hereof any such moneys
shall become payable for
88
any purpose (including the payment of the principal of or interest on any
Security) the Trustee shall not have received with respect to such moneys the
notice provided for in this section, then, regardless of anything herein to the
contrary, the Trustee shall have full power and authority to receive such moneys
and to apply the same to the purpose for which they were received, and shall not
be affected by any notice to the contrary which may be received by it on or
after such prior date.
Subject to Sections 6.01 and 6.03, the Trustee shall be entitled to
rely on the delivery to it of a written notice by a Person representing himself
to be a holder of Senior Indebtedness (or a trustee or other representative on
behalf of such holder) to establish that such notice has been given by a holder
of Senior Indebtedness or a trustee or other representative on behalf of any
such holder. In the event that the Trustee determines in good faith that
further evidence is required with respect to the right of any Person as a holder
of Senior Indebtedness to participate in any payment or distribution pursuant to
this Article, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under this Article, and, if such evidence is not furnished, the
Trustee may defer any Payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
Section 14.07 Trustee's Relation to Senior Indebtedness.
The Trustee and any agent of the Company or the Trustee shall be
entitled to all the rights set forth in this Article with respect to any Senior
Indebtedness which may at any time be held by it in its individual or any other
capacity to the same extent as any other holder of Senior Indebtedness and
nothing in the Trust Indenture Act or in this Indenture shall deprive the
Trustee or any such agent of any of its rights as such holder. Nothing in this
Article shall apply to claims of, or payments to, the Trustee under or pursuant
to Section 6.07.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness and, subject to the
provisions of Sections 6.01 and 6.03, the Trustee shall not be liable to any
holder of Senior Indebtedness if it shall in good faith pay over or deliver to
Holders of Subordinated Securities, the Company or any other Person moneys or
assets to which any holder of Senior Indebtedness shall be entitled by virtue of
this Article or otherwise.
Section 14.08 No Impairment of Subordination.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof which any such holder may have or
otherwise be charged with.
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Section 14.09 Trust Moneys Not Subordinated.
Notwithstanding anything contained herein to the contrary, payments
from money or the proceeds of U.S. Government Obligations held in trust under
Article Thirteen by the Trustee for the payment of principal of, premium, if
any, and interest on the Subordinated Securities shall not be subordinated to
the prior payment of any Senior Indebtedness or subject to the restrictions on
this Article Fourteen, and none of the Trustee or the Holders of the
Subordinated Securities shall be obligated to pay over any such amount to the
Company or any holder of Senior Indebtedness of the Company or any other
creditor of the Company.
ARTICLE FIFTEEN
Amendments
Section 15.01 Without Consent of Holders.
The Company and the applicable Trustee may amend this Indenture, the
Securities or any Coupons without the consent of any Holder:
(a) to evidence the succession of another corporation to the rights
of the Company and the assumption by such successor of the covenants and
obligations of the Company in this Indenture and in the Securities and Coupons,
if any, issued hereunder;
(b) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities and the Coupons, if any, appertaining
thereto (and if such covenants are to be for the benefit of less than all
series, stating that such covenants are expressly being included solely for the
benefit of such series), or to surrender any right or power conferred in this
Indenture upon the Company;
(c) to add any additional Events of Default (and if such Events of
Default are to be applicable to less than all series, stating that such Events
of Default are expressly being included solely to be applicable to such series);
(d) to add or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance hereunder of
Securities of any series in bearer form, registrable or not registrable, and
with or without Coupons, to permit Bearer Securities to be issued in exchange
for Registered Securities, to permit Bearer Securities to be issued in exchange
for Bearer Securities of other authorized denominations or to permit the
issuance of Securities of any series in uncertificated form, provided that any
such action shall not adversely affect the interests of the Holders of
Securities of any series or any related Coupons in any material respect;
(e) to change or eliminate any of the provisions of this Indenture;
provided, that any such change or elimination will become effective only when
there is no Outstanding Security issued hereunder or Coupon of any series
created prior to such modification which is entitled to the benefit of such
provision and as to which such modification would apply;
(f) to secure the Securities issued hereunder;
(g) to supplement any of the provisions of this Indenture to such
extent as is necessary to permit or facilitate the defeasance and discharge of
any series of Securities, provided
90
that any such action will not adversely affect the interests of the Holders of
Securities of such series or any other series of Securities issued under such
Indenture or any related Coupons in any material respect;
(h) to establish the form or terms of Securities and Coupons, if any,
as permitted by Sections 2.01 and 3.01 hereof;
(i) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to one or more series of
Securities and to add to or change any of the provisions of this Indenture as is
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee pursuant to the requirements of Section 6.11
hereof; or
(j) to cure any ambiguity, to correct or supplement any provision in
this Indenture which may be defective or inconsistent with any other provision
herein, to eliminate any conflict between the terms of this Indenture and the
Securities issued hereunder and the Trust Indenture Act or to make any other
provisions with respect to matters or questions arising under this Indenture
which will not be inconsistent with any provision of this Indenture; provided,
that such other provisions shall not adversely affect the interests of the
Holders of Outstanding Securities or Coupons, if any, of any series created
hereunder prior to such modification in any material respect.
Section 15.02 With Consent of Holders.
With the written consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
modification voting together as one class, the Company and the applicable
Trustee may amend this Indenture, the Securities and any Coupons 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 Securities and Coupons, if any, under this Indenture. However,
without the consent of each Holder affected, an amendment under this Section may
not:
(a) change the Stated Maturity of the principal of, or any
installment of interest on, any Security, or reduce the principal amount thereof
or the interest thereon or any premium payable upon redemption thereof, or
change the Stated Maturity of or reduce the amount of any payment to be made
with respect to any Coupon, or change the currency or currencies in which the
principal of (and premium, if any) or interest on such Security is denominated
or payable, or reduce the amount of the principal of an Original Issue Discount
Security that would be due and payable upon a declaration of acceleration of the
Maturity thereof, or adversely affect the right of repayment or repurchase, if
any, at the option of the Holder, or reduce the amount of, or postpone the date
fixed for, any payment under any sinking fund or analogous provisions for any
Security, or impair the right to institute suit for the enforcement of any
payment on or after the Stated Maturity thereof (or, in the case of redemption,
on or after the Redemption Date), or limit the obligation of the Company to
maintain a paying agency outside the United States for payments on Bearer
Securities, or adversely affect the right to convert any Subordinated Security
into shares of Common Stock as may be set forth in the Prospectus Supplement;
(b) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any such
modification, or the consent of whose Holders is required for any waiver of
compliance with certain provisions of this Indenture or certain defaults or
Events of Default hereunder and their consequences provided for in such
Indenture;
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(c) modify any of the provisions of this Indenture relating to
modifications and waivers of defaults and covenants, except to increase any such
percentage or to provide that certain other provisions of this Indenture cannot
be modified or waived without the consent of the Holder of each Outstanding
Security of each series affected thereby; provided, however, that certain of
such modifications may be made without the consent of any Holder of any Security
as provided in the preceding paragraph; or
(d) modify any of the provisions relating to the subordination of the
Subordinated Securities in a manner adverse to the Holders thereof.
(e) In the case of the Subordinated Securities, no modification may
adversely affect the rights of any holder of Senior Indebtedness under the
subordination provisions without the consent of such Holder.
An amendment of a provision included solely for the benefit of one or
more series does not affect Holders of any other series.
Holders need not consent to the exact text of a proposed amendment or
waiver; it is sufficient if they consent to the substance thereof.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of any such series waive, by notice to the applicable Trustee and the
Company, any past default or Event of Default under this Indenture with respect
to such series and its consequences, except a default (1) in the payment of the
principal of (or premium, if any) or interest on any Security of such series, or
in the payment of any sinking fund installment or analogous obligation with
respect to the Securities of such series or (2) in respect of a covenant or
provision hereof which pursuant to this Section 15.02 cannot be modified or
amended without the consent of the Holder of each Outstanding Security of such
series affected. Upon any such waiver, such default will cease to exist, and any
Event of Default arising therefrom will be deemed to have been cured, for every
purpose of the Securities of such series under this Indenture, but no such
waiver will extend to any subsequent or other default or Event of Default or
impair any right consequent thereon.
The Company may omit in any particular instance to comply with certain
covenants in this Indenture, if before the time for such compliance the Holders
of at least a majority in principal amount of the Outstanding Securities
affected either waive such compliance in such instance or generally waive
compliance with such provisions, but no such waiver may extend to or affect any
term, provision or condition except to the extent expressly so waived, and,
until such waiver becomes effective the obligations of the Company and the
duties of the applicable Trustee in respect of any such provision will remain in
full force and effect.
Section 15.03 Compliance with Trust Indenture Act.
Every amendment pursuant to Section 15.01 or 15.02 shall be set forth
in a supplemental indenture that complies with the Trust Indenture Act as then
in effect.
If a provision of the Trust Indenture Act requires or permits a
provision of this Indenture and the Trust Indenture Act provision is amended,
then this Indenture provision shall be automatically amended to like effect.
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Section 15.04 Effect of Consents.
An amendment or waiver becomes effective in accordance with its terms
and thereafter binds every Holder entitled to consent to it.
A consent to an amendment or waiver by a Holder of a Security is a
continuing consent by the Holder and every subsequent Holder of a Security that
evidences the same debt as the consenting Holder's Security. Any Holder or
subsequent Holder may revoke the consent as to his Security if the Trustee
receives notice of the revocation before the amendment or waiver becomes
effective.
The Company may fix a record date for the determination of Holders of
Registered Securities entitled to give a consent. The record date shall not be
less than 10 nor more than 60 days prior to the first written solicitation of
Holders.
Section 15.05 Notation on or Exchange of Securities.
The Company or the Trustee may place an appropriate notation about an
amendment or waiver on any Security thereafter authenticated. The Company may
issue in exchange for affected Securities new Securities that reflect the
amendment or waiver.
Section 15.06 Trustee Protected.
The Trustee need not sign any supplemental indenture that adversely
affects its rights. The Trustee shall be entitled to receive, and shall be
fully protected in relying upon, an Opinion of Counsel and an Officers'
Certificate each stating that the execution of any amendment or supplement or
waiver authorized pursuant to this Article is authorized or permitted by this
Indenture, and that such amendment or supplement or waiver constitutes the
legal, valid and binding obligation of the Company.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the day and year first above written.
CONTIFINANCIAL CORPORATION
By: /s/ Xxxxxx Xxxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Chief Financial Officer
By: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
Title: Treasurer
THE BANK OF NEW YORK, as Trustee
By: /s/ Xxxxx Xxxxxxxx
-------------------------------------
Name: Xxxxx Xxxxxxx
Title: Assistant Treasurer
