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DORAL FINANCIAL CORPORATION
TO
BANKERS TRUST COMPANY,
TRUSTEE
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FIRST SUPPLEMENTAL INDENTURE
DATED AS OF OCTOBER 19, 1998
TO INDENTURE DATED AS OF OCTOBER 10, 1996
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FIRST SUPPLEMENTAL INDENTURE, dated as of October 19, 1998 between
Doral Financial Corporation (formerly First Financial Caribbean Corporation), a
Puerto Rico corporation (the "Company"), and Bankers Trust Company, a New York
banking corporation, as Trustee (the "Trustee").
RECITALS
WHEREAS, the Company and the Trustee are parties to an Indenture,
dated as of October 10, 1996 (the "Original Indenture"), which provided for the
issuance of 7.84% Senior Notes due 2006 of the Company; and
WHEREAS, Section 902 of the Original Indenture provides that with the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities, the Company, when authorized by Board Resolution, and
the Trustee may enter into an indenture or indentures supplemental to the
Original Indenture for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of the Original Indenture or of
modifying in any manner the rights of the Holders under the Original Indenture,
provided that no such supplement shall change, reduce or modify certain items,
or impair certain rights, set forth in said Section 902; and
WHEREAS, the Company believes that the Original Indenture should be
amended to (i) eliminate the covenant contained in Section 1008 limiting the
incurrence of Indebtedness or issuance of Disqualified Stock by the Company or
any of its Subsidiaries, (ii) eliminate the covenant contained in Section 1010
limiting the creation of Liens on any Property, shares of Capital Stock or
Indebtedness of the Company or of any Subsidiary; (iii) modify the covenant
limiting the issuance of securities by subsidiaries of the Company; (iv)
eliminate certain definitions that are no longer required as a result of the
foregoing
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modifications; (v) modify the covenant contained in Section 801 restricting
mergers and similar transactions to eliminate the reference to compliance with
the debt incurrence test contained in Section 1008 that is being eliminated;
(vi) add an additional covenant to the Indenture that would require the Company
to maintain a minimum Consolidated Net Worth; (vii) modify the definition of
the term "Indebtedness" to eliminate the references to Permitted Indebtedness
contained therein and (viii) modify the definition of the term "Company" to
reflect the change in the Company's name from First Financial Caribbean
Corporation to Doral Financial Corporation.
WHEREAS, the Board of Directors of the Company has duly authorized the
execution and delivery by the Company of this First Supplemental Indenture; and
WHEREAS, the holders of more than fifty percent (50%) in aggregate
principal amount of the Outstanding Securities have specifically consented in
writing to and approved the execution hereof;
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH: For and
in consideration of the premises and the other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the Company and
the Trustee mutually agree as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. DEFINITIONS.
Except as otherwise expressly provided or unless the context otherwise
requires, all terms used in this First Supplemental Indenture
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which are defined in the Original Indenture shall have the meanings ascribed to
them by the Original Indenture.
SECTION 102. EFFECT OF HEADINGS.
The Article and Section headings herein are for convenience only and
shall not affect the construction hereof.
SECTION 103. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this First Supplemental Indenture by
the parties hereto shall bind their respective successors and assigns, whether
so expressed or not.
SECTION 104. SEPARABILITY CLAUSE.
In case any provision in this First Supplemental Indenture shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 105. BENEFITS OF INSTRUMENT.
Nothing in this First Supplemental Indenture, 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 First Supplemental Indenture or the Original Indenture.
SECTION 106. GOVERNING LAW.
This First Supplemental Indenture shall be governed by and construed
in accordance with the law of the State of New York.
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ARTICLE TWO
AMENDMENT OF THE ORIGINAL INDENTURE
SECTION 201. AMENDMENT OF SECTION 101 OF THE ORIGINAL INDENTURE.
(a) The definition of the term "Company" contained in Section 101 of
the Indenture is hereby amended to read in its entirety as follows:
"'Company' means Doral Financial Corporation until a successor
Person shall have become such pursuant to the applicable provisions
of this Indenture and thereafter "Company" shall mean such successor
Person."
(b) The following definitions in Section 101 of the Original Indenture
are hereby deleted in their entirety: "Consolidated EBITDA," "Consolidated
Income Tax Expense," "Consolidated Interest Coverage Ratio," "Consolidated
Interest Expense," "Consolidated Non-Cash Charges," "Consolidated Non-cash Net
Income Contributions," "Permitted Indebtedness," "Permitted Liens," and
"Restricted Indebtedness."
(c) Subclause (g) and (h) of clause (i) of the definition of
"Indebtedness" in Section 101 of the Original Indenture are hereby amended and
restated in their entirety as follows:
"(g) for reimbursement in respect of letters of credit but only to the
extent that the letters of credit do not support an obligation of such
Person already included in Indebtedness, or (h) under Interest Rate
Protection Agreements;"
SECTION 202. AMENDMENT OF SECTION 801 OF THE ORIGINAL INDENTURE.
The text of Section 801 of the Original Indenture is hereby amended to
read in its entirety as follows:
"The Company shall not consolidate with or merge into any other
Person or convey, transfer or lease all or substan-
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tially all of its Property to any Person, and the Company shall not
permit any Person to consolidate with or merge into the Company or
convey, transfer or lease all or substantially all of its Property to
the Company, unless:
(1) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease all or substantially all
of its Property to any Person, the Person formed by such consolidation
or into which the Company is merged or the Person which acquires by
conveyance or transfer, or which leases, all or substantially all of
the Property of the Company shall be a corporation, partnership or
trust, shall be organized and validly existing under the laws of the
United States of America, any State thereof, the Commonwealth of
Puerto Rico or the District of Columbia and shall expressly assume, by
an indenture supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the due and punctual
payment of the principal of (and premium, if any) and interest on all
the Securities and the performance of every covenant of this Indenture
on the part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time or
both, would become an Event of Default, shall have occurred and be
continuing;
(3) immediately after giving effect to such transaction, the
Company or such surviving entity shall have a Consolidated Net Worth
equal to or greater than the Consolidated Net Worth of the Company
immediately prior to such transaction; and
(4) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article and
that all conditions precedent herein provided for relating to such
transaction have been complied with."
SECTION 203. AMENDMENT OF SECTION 1008 OF THE ORIGINAL INDENTURE.
Section 1008 of the Original Indenture is hereby amended to read in
its entirety as follows:
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"Section 1008. Maintenance of Consolidated Net Worth.
The Company shall not permit its Consolidated Net Worth as of the end
of each fiscal quarter to be less than $185,000,000."
SECTION 204. AMENDMENT OF SECTION 1010 OF THE ORIGINAL INDENTURE.
Section 1010 of the Original Indenture is hereby deleted in its
entirety and replaced with the caption "[RESERVED]."
SECTION 205. AMENDMENT TO SECTION 1014 OF THE ORIGINAL INDENTURE.
The text of Section 1014 of the Original Indenture is hereby amended
to read in its entirety as follows:
"The Company will not (i) sell, pledge, hypothecate or otherwise
convey or dispose of any Capital Stock of a Subsidiary or (ii)
permit a Subsidiary to issue or sell any Capital Stock or other
equity interest to any person (other than to the Company or to a
Wholly-Owned Subsidiary of the Company); provided that the foregoing
restrictions shall not apply (w) to any such sale, disposition or
issuance which does not exceed $5,000,000 in fair market value (as
determined in good faith by the Company), (x) to the issuance and
sale of nonvoting, nonconvertible preferred stock of any Subsidiary,
provided that the aggregate liquidation or stated value of all such
nonvoting, nonconvertible preferred stock does not exceed 5% of the
Consolidated Net Tangible Assets of the Company, (y) to the issuance
or sale of qualifying shares to a director, and (z) to the issuance
and sale of preferred securities by a business trust or other entity
that qualifies as a Subsidiary for purposes of Section 101 hereof,
to the extent that the proceeds of the sale of such preferred
securities (less related expenses of the offering) are used to
purchase junior subordinated deferred interest securities of the
Company or a Subsidiary thereof that qualify as Tier 1 capital for
bank holding companies."
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SECTION 206. REAFFIRMATION OF ORIGINAL INDENTURE.
Each of the Company and the Trustee hereby confirms, reaffirms and
agrees to the Original Indenture in every particular, as amended by this First
Supplemental Indenture.
SECTION 207. TRUSTEE NOT RESPONSIBLE FOR RECITALS. The recitals herein
contained are made by the Company and not by the Trustee, and the Trustee
assumes no responsibility for the correctness thereof. The Trustee makes no
representation as to the validity or sufficiency of this First Supplemental
Indenture.
SECTION 208. TRUST INDENTURE ACT.
If any provision of this First Supplemental Indenture limits,
qualifies or conflicts with a provision of the Trust Indenture Act of 1939, as
it may be amended from time to time, that is required under such Act to be a
part of and govern this First Supplemental Indenture, the latter provision
shall control. If any provision hereof modifies or excludes any provision of
such Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this First Supplemental Indenture as so modified or
excluded, as the case may be.
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This First Supplemental 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.
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IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed, and their respective corporate
seals to be hereunto affixed and attested, all as of the day and year first
above written.
DORAL FINANCIAL CORPORATION
(formerly First Financial
Caribbean Corporation)
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: Chairman of the Board
Attest:
/s/Xxxxxxx X. Xxxxxx
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Secretary
BANKERS TRUST COMPANY
By: /s/Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx
Title: Assistant Vice President
Attest:
/s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx
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STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
On the 19th day of October, 1998, before me personally came Xxxxxxx
Xxxxx, to me known, who, being by me duly sworn, did depose and say that he is
the Chairman of the Board of Doral Financial Corporation, one of the entities
described in and which executed the foregoing instrument; that he knows the
corporate seal of such corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of such corporation, and that he signed his name thereto by like
authority.
/s/ Xxxxxxx Xxxxxx
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Notary Public, State of New York
No. 01GO5016739
Qualified in New York County
Commission Expires Aug. 23, 0000
XXXXX XX XXX XXXX )
) ss.
COUNTY OF NEW YORK )
On the 19th day of October, 1998, before me personally came Xxxxx
Xxxxxxx, to me known, who, being by me duly sworn, did depose and say that he
is an Assistant Vice President of Bankers Trust Company, the banking
corporation described in and which executed the foregoing instrument; that he
knows the seal of said banking corporation; that the seal affixed to said
instrument is such seal; that it was so affixed by authority of the Board of
Directors of said banking corporation, and that he signed his name thereto by
like authority.
/s/ Xxxxxxxx Xxxxxx
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Xxxxxxxx Xxxxxx
Notary Public, State of New York
No. 315023900
Qualified in New York County
Commission Expires 2/22/2000
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