Form of Senior Unsecured Note]
Exhibit
d.3
[Form of
Senior Unsecured Note]
THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
THE
HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS THAT IT IS AN
“ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501 UNDER THE SECURITIES ACT,
AND (2) AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY ONLY (A) TO
THE COMPANY, (B) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A
“QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (C) PURSUANT TO OFFERS AND SALES TO NON-U.S. PURCHASERS
THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER
THE SECURITIES ACT, (D) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE
MEANING OF SUBPARAGRAPH (a)(1),(2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH
A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT, (E) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
THE SECURITIES LAWS OF ANY OTHER JURISDICTION, INCLUDING ANY STATE OF THE UNITED
STATES, SUBJECT TO THE COMPANY’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (C), (D) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO THE COMPANY AND
IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING
ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR
TO THE COMPANY.
FULL
CIRCLE CAPITAL CORPORATION
8%
Senior Subordinated Note
| No. ___ |
$____________
|
Dated: _______________,
20__
Capitalized terms used herein have the
meanings assigned to them in the Note Agreement referred to below unless
otherwise indicated.
1. PRINCIPAL
AND INTEREST
FULL
CIRCLE CAPITAL CORPORATION, a Maryland corporation (the “Company”), promises to pay to
________________ or
registered assigns, the principal sum of _________________DOLLARS on
_____________, 2014.
Interest
Payment Dates: ____________ , ____________, ____________, and
____________
Record Dates: ____________,
____________, ____________, and ____________
The
Company promises to pay interest on the principal amount of this Note at 8% per
annum from ________________, 20__ until maturity payable quarterly in arrears on
___________, ___________, ___________ and ____________ of each year, or if any
such day is not a Business Day, on the next succeeding Business Day (each, an
“Interest Payment
Date”). Interest on the Notes will accrue from the most recent
date to which interest has been paid or, if no interest has been paid, from the
date of issuance; provided that if there is no
existing default in the payment of interest, and if this Note is issued between
a record date referred to on the face hereof and the next succeeding Interest
Payment Date, interest shall accrue from such next succeeding Interest Payment
Date; provided,
further, that the first Interest Payment Date shall be _____________,
20__. The Company will pay interest on overdue principal and premium,
if any, from time to time on demand at a rate that is equal to the rate then in
effect to the extent lawful; it will pay interest on overdue installments of
interest (without regard to any applicable grace periods) from time
to time on demand at the same rate to the extent lawful. Interest
will be computed on the basis of a 360-day year of twelve 30-day
months. During the continuance of an Event of Default (as such term
is defined below), additional interest of 2.00% per annum payable in kind
will accrue on the Notes. The Company may withhold from any amounts
payable under this Note such U.S. Federal, state, local and foreign taxes as
shall be required to be withheld pursuant to any applicable law or
regulation.
2. METHOD
OF PAYMENT.
The
Company will pay interest on this Note (except defaulted interest) to the person
who is the registered Holder of this Note at the close of business on the
__________, __________, ___________ and __________ next preceding the Interest
Payment Date. Interest not punctually paid will be paid to the
persons who are registered Holders as of the close of business on a record date
so designated by the Company. The Holder must surrender this Note to
the Company to collect payment of principal. The Company may pay
principal and interest by a check and mailed to the Holder’s registered address;
provided that payment
by wire transfer of immediately available funds may be paid by the Company with
respect to principal of and interest and premium, if any, on all Notes the
Holders of which will have provided wire transfer instructions to the
Company.
3. NOTE
AGREEMENT.
This Note
is one of a duly authorized issue of Notes of the Company designated as its 8%
Senior Subordinated Notes (the “Notes”), issued under a Note
Agreement dated as of ___________, 2010 (the “Note Agreement”), among the
Company and the several investors party thereto. This Note is subject
to all such terms, and the Holder of this Note is referred to the Note
Agreement. Capitalized terms used herein without definition have the
respective meanings ascribed to them in the Note Agreement. The Notes
are senior unsecured obligations of the Company limited to $[ ] aggregate
principal amount.
4. SUBORDINATION
PROVISIONS.
(a) Definitions. The following terms when used in this
Note shall have the meaning as assigned to them below:
“Lender” means, initially, FCC, LLC,
d/b/a First Capital, and, following repayment in full in cash of all Senior Debt
owing to FCC, LLC, d/b/a First Capital, the lender from time to time party to
the Loan Agreement (or, if there is more than one lender party to the Loan
Agreement, the administrative agent for such lenders).
“Loan Agreement” means that certain
Second Amended and Restated Loan and Security Agreement, dated as of July
[__], 2010, by and between Company and FCC,
LLC, d/b/a First Capital, and any agreement, instrument or document providing
for the refinancing or refunding thereof, in each case as amended, restated,
modified or supplemented through the date hereof and hereafter and in effect
from time to time.
“Permitted Payment” means a regularly
scheduled payment of interest with respect to this Note at the stated,
non-default interest rate provided for herein (but not any prepayment and not
any payment with respect to principal), but only to the extent that, both before
and after giving effect to such payment, no default or event of default exists
under the Loan Agreement.
“Senior Debt” means as all loans,
advances, debts, liabilities, debit balances, covenants and duties at any time
or times owed by Company to Lender, whether direct or indirect, absolute or
contingent, secured or unsecured, primary or secondary, joint or several,
liquidated or unliquidated, due or to become due, now existing or hereafter
arising, including (i) all debts, liabilities and obligations now or hereafter
owing by Company to Lender under the Loan Agreement, (ii) all debts, liabilities
or obligations owing by Company to others which Lender may have obtained by
assignment, pledge, purchase or otherwise, (iii) all loans made or credit
extended by Lender to Company during the pendency of any bankruptcy or other
insolvency proceeding of Company, (iv) all interest, fees, charges, expenses,
indemnity obligations and attorneys’ fees for which Company is now or hereafter
becomes liable to pay to Lender under any agreement or by law (including, all
interest, legal fees and other charges that accrue or are incurred in connection
with any of the Senior Debt during the pendency of any bankruptcy case or other
insolvency proceeding of Company, whether or not Lender is authorized by 11
U.S.C. § 506 or otherwise to claim or collect any such interest, legal fees or
other charges from Company), and (v) any renewals, extensions or refinancings of
any of the foregoing.
“Subordinated Debt” means all amounts
payable pursuant to this Note and/or the Note Agreement.
(b) Subordination to Senior
Debt. Notwithstanding anything in this Note or the Note Agreement to
the contrary, the Holder hereby agrees and covenants that, to the extent set
forth herein and on the terms and conditions set forth herein, the Subordinated
Debt is and shall be subordinate in right of order and payment to the repayment
in full, in cash, of the Senior Debt. Each holder of Senior Debt,
either now existing or hereafter arising, shall be deemed to have acquired such
Senior Debt in reliance upon the provisions contained in this Section
4.
(c) Limitations on Payments and Remedies
with respect to the Subordinated Debt. Xxxxxx hereby agrees as
follows:
(i) Except for Permitted Payments, Holder
shall not take or receive, directly or indirectly (including via any right of
offset or setoff), any payments with respect to any Subordinated
Debt;
(ii) Holder shall not accelerate, demand, sue
for, commence any collection, litigation or enforcement action or exercise any
remedy with respect to the Subordinated Debt until the prior payment in full, in
cash, of the Senior Debt; and
(iii) in the event that, notwithstanding the
foregoing provisions of this Section 4(c), any payment with respect to any
Subordinated Debt other than a Permitted Payment, either directly or indirectly,
shall be made by or on behalf of the Company, and received by the Holder, then
such payment shall be held in trust for the benefit of, and shall be promptly
paid over to, Lender.
(d) Subordination upon Dissolution,
Liquidation or Reorganization of Company. Upon any distribution by
the Company of assets of any kind or character, whether in cash, property or
securities, to creditors upon any dissolution, winding up, liquidation or
reorganization of the Company, whether in a voluntary or involuntary bankruptcy,
insolvency or receivership proceedings or upon any assignment for the benefit of
creditors or otherwise or any other marshalling of assets and liabilities of the
Company:
(i) Lender shall first receive payment in
full in cash of all Senior Debt (or have such payments duly provided for in a
manner satisfactory to Lender) before the Holder is entitled to receive any
payment on account of or accrued or incurred in connection with any Subordinated
Debt;
(ii) any payment or distribution of assets of
the Company of any kind or character, whether in cash, property or securities to
which the Holder would be entitled except for the provisions of this Section 4
shall be paid by the Company, the liquidating trustee or agent or other person
making such a payment or distribution, directly to Lender to the extent
necessary to make payment in full of all Senior Debt remaining unpaid;
and
(iii) 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, shall be received by the
Holder on account of, or accrued or incurred in connection with, any
Subordinated Debt before all Senior Debt is paid in full in cash, then such
payment or distribution shall be received and held in trust for the benefit of
and shall be promptly paid over to Lender for application to the payment of all
Senior Debt until such Senior Debt shall have been paid in
full.
(e) Subordination Rights Not
Impaired.
(i) No right of Lender to enforce the
subordination provisions herein 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 Xxxxxx, or by any noncompliance by the
Company with the terms of any Subordinated Debt, regardless of any knowledge
thereof which Lender may have or be otherwise charged with. Lender
may extend, renew, modify or amend the Loan Agreement, the related loan
documents and the terms of any Senior Debt or any security therefor and release,
sell or exchange such security and otherwise deal freely with the Company, all
without affecting rights of Xxxxxx xxxxxxxxx.
(ii) All rights and interests hereunder of
Lender, and all agreements and obligations of the Holder under this Section 4,
shall remain in full force and effect irrespective of (1) any lack of validity
or enforceability of the Loan Agreement or any other loan document executed in
connection therewith, or of any provision of such agreements, or (2) any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Company in respect of the Senior Debt.
(f) Authorization to Effect
Subordination. The Holder, by its acceptance hereof, (i)
irrevocably authorizes and empowers (but without imposing any obligation on)
Lender (through its authorized representatives), to demand, sue for, collect and
receive Holder’s ratable share of payments or distributions with respect to
Subordinated Debt and take all such other action, in the name of Holder or
otherwise, as such authorized representatives may determine to be necessary or
appropriate for the enforcement of the provisions of this Section 4, including
without limitation, that (1) such representatives shall have the right to vote
Xxxxxx’s interest in any proceeding under applicable insolvency laws as such
vote relates to any Subordinated Debt and (2) in any such proceeding such
representatives may, as attorney-in-fact for Holder, file any claim, proof of
claim or such other instrument of similar character; and (ii) agrees to execute
and deliver to such representatives, all such further instruments confirming the
authorization hereinabove set forth, and all such powers of attorney, proofs of
claim, assignments of claim and other instruments as may reasonably be requested
by Xxxxxx.
(g) Amendments and Modifications to
Note. Under no circumstance shall the Holder or Company amend or
modify, or permit the amendment or modification of, any provision of this Note,
including without limitation any amendment to shorten the maturity date, change
the amortization schedule or increase the interest rate, in any way adverse to
the interests of Lender.
(h) Security for Subordinated
Debt. Except with the prior written consent of Lender, in no event
shall the Holder take, accept or receive any lien or security interest on any
asset of the Company or its subsidiaries or any other collateral or security for
the Subordinated Debt.
(i) Further
Subordination. Neither the Holder nor any obligor with respect to the
Subordinated Debt shall agree to any further subordination of the Subordinated
Debt.
5. OPTIONAL
REDEMPTION.
Subject
to the subordination provisions set forth herein, the Company may, at its
option, at any time and from time to time redeem all or any part of the Notes
(in a minimum principal amount of $100,000 and otherwise in multiples of $10,000
in excess thereof) on any date prior to maturity upon delivery of the notice as
set forth in Section 3.03 of the Note Agreement at a redemption price of 100% of
the principal amount thereof, plus accrued and unpaid interest to the redemption
date.
6. NOTICE
OF REDEMPTION.
Notice of redemption will be delivered
at least five days but not more than 60 days before the redemption date to each
Holder whose Notes are to be redeemed.
7. TRANSFER,
EXCHANGE.
A Holder
may register the transfer of or exchange Notes in accordance with the Note
Agreement. The Company may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and to pay any taxes or
other governmental charges that may be imposed by law or permitted by the Note
Agreement.
8. PERSONS
DEEMED OWNERS.
The
registered Holder of a Note may be treated as the owner of such Note for all
purposes.
9. UNCLAIMED
MONEY.
If money
for the payment of principal or interest remains unclaimed for two years, the
Holders entitled to money must look to the Company for payment as general
creditors unless an abandoned property law designates another
person.
10. AMENDMENT,
SUPPLEMENT, WAIVER.
Subject
to certain exceptions set forth in the Note Agreement, the Note Agreement or the
Notes may be amended or supplemented with the consent of the Majority Holders
and any past default or compliance with any provision may be waived in a
particular instance with the consent of the Majority Holders.
11. DEFAULTS
AND REMEDIES.
An “Event of Default” shall mean one of
the following events (provided that any such event
that is cured by or on behalf of the Company shall cease to constitute an Event
of Default under this Agreement): (i) default in the payment of interest on the
Notes when it becomes due and payable, and continuance of such default for a
period of 30 days; (ii) default in the payment of principal of, or premium, if
any, on the Notes, as and when the same become due, either at stated maturity,
upon redemption, or otherwise; (iii) default or breach in the performance or
breach of any covenant in the Notes or the Note Agreement, and continuation of
such default or breach for a period of 60 days after Holders of at least 25% in
principal amount of the Notes have given written notice to the Company
specifying such default or breach and requiring it to be remedied and stating
that such notice is a “Notice of Default”; (iv) a default on any Indebtedness
(including judgment debt), either pursuant to a loan agreement with FCC, LLC
d/b/a First Capital as the lender, or which default results in the acceleration
of Indebtedness in an amount in excess of $35.0 million; without such
Indebtedness having been discharged or the acceleration having been cured,
waived, rescinded or annulled, for a period of 30 days or more after the Holders
of at least 25% in aggregate principal amount of the outstanding Notes have
given written notice to the Company specifying such default or breach and
requiring it to be remedied and stating that such notice is a “Notice of
Default”; (v) the entry of an order for relief against the Company or any of its
Subsidiaries under Bankruptcy Law by a court having jurisdiction in the premises
or a decree or order by a court having jurisdiction in the premises adjudging
the Company or such Subsidiary a bankrupt or insolvent under any other
applicable federal or state law, or the entry of a decree or order approving as
properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company or any of its Subsidiaries under
Bankruptcy Law or any other applicable federal or state law, or appointing a
receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company or any of its Subsidiaries, or of any substantial part
of their respective property, or ordering the winding up or liquidation of its
affairs, and the continuance of any such decree or order unstayed and in effect
for a period of 60 consecutive days; (vi) the consent by the Company or any of
its Subsidiaries to the institution of bankruptcy or insolvency proceedings
against it, or the filing by the Company or any of its Subsidiaries of a
petition or answer or consent seeking reorganization or relief under Bankruptcy
Law or any other applicable federal or state law, or the consent by them to the
filing of any such petition or to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or other similar official) of the Company or
such Subsidiary or of any substantial part of their respective property, or the
making by it of an assignment for the benefit of creditors, or the admission by
them in writing of their inability to pay their debts generally as they become
due, or the taking of corporate action by the Company or such Subsidiary in
furtherance of any such action; or (vii) Full Circle Advisors no longer is the
investment manager of the Company.
Subject to the subordination provisions
set forth herein, if an Event of Default, other than an Event of Default
pursuant to clause (v) or (vi) has occurred and has not been cured or waived,
then the Holders of not less than 50% in principal amount of the Notes may
declare the entire principal amount of, and any accrued and unpaid interest on,
the Notes to be immediately due and payable. Any such acceleration
may be cancelled by Majority Holders if all Events of Default have been cured or
waived. If an Event of Default of the type described in clause (v) or
(vi) has occurred, the entire principal amount of, and any accrued and unpaid
interest on, the Notes shall become immediately due and payable without any
declaration or any act of any Holder.
12. NO
RECOURSE AGAINST OTHERS.
A
director, officer, employee or stockholder, as such, of the Company shall not
have any liability for any obligations of the Company under the Notes or the
Note Agreement or for any claim based on, in respect or by reason of, such
obligations or their creation. The Holder of this Note, by accepting
this Note, waives and releases all such liability. The waiver and
release are part of the consideration for the issuance of this
Note.
13. NOTE
AGREEMENT TO CONTROL.
In the
case of any conflict between the provisions of this Note and the Note Agreement,
the provisions of the Note Agreement shall control.
14. GOVERNING
LAW.
THE
INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THE
NOTE AGREEMENT AND THIS NOTE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY.
The Company will furnish to any Holder
upon written request and without charge a copy of the Note
Agreement. Requests may be made to:
Full
Circle Capital Corporation
000
Xxxxxxxxxxx Xxx., Xxxxx X-000
Rye
Brook, New York 10573
Attention: [
]
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FULL CIRCLE CAPITAL
CORPORATION
By: _____________________________
Name:
_______________________
Title: ________________________
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TRANSFER
NOTICE
This
Transfer Notice relates to $__________ principal amount of the 8% Senior
Subordinated Notes of Full Circle Capital Corporation, a Maryland corporation,
held by ______________________________ (the “Transferor”).
(I) or
(we) assign and transfer this Note to
(Print or
type assignee’s name, address and zip code)
(Insert
assignee’s social security or tax I.D. no.)
and
irrevocably appoint _______________________________ agent to transfer this Note
on the books of the Company. The agent may substitute another to act
for him.
Your
Signature:
(Sign
exactly as your name appears on the other side of this Note)
Date:
Signature
Guarantee**:
In
connection with any transfer of any of the Notes evidenced by this certificate,
the undersigned confirms that such Notes are being transferred:
CHECK
ONE BOX BELOW
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(1)
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[ ]
to the Company; or
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(2)
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pursuant to and in compliance with Rule 144A under the Securities Act of
1933, as amended; or
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(3)
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pursuant to and in compliance with Regulation S under the Securities Act
of 1933, as amended; or
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(4)
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to an institutional “accredited investor” (as defined in Rule 501(a)(1),
(2), (3) or (7) under the Securities Act of 1933, as amended, that has
furnished to the Company a signed letter containing certain
representations and agreements (the form of which letter can be obtained
from the Company)); or
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(5)
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pursuant to another available exemption from the registration requirements
of the Securities Act of 1933; or
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(6)
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pursuant to an effective registration statement under the Securities Act
of 1933.
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Unless
one of the boxes is checked, the Company will refuse to register any of
the Notes evidenced by this certificate in the name of any person other
than the registered holder thereof; provided, however, that if
box (3), (4) or (5) is checked, the Company may require, prior
to registering any such transfer of the Notes such legal opinions,
certifications and other information as the Company has reasonably
requested to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption provided
by Rule 144 under such Act.
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Unless
the box below is checked, the undersigned confirms that such Note is not
being transferred to an “affiliate” of the Company as defined in Rule 144
under the Securities Act of 1933, as amended (an
“Affiliate”):
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(7)
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The transferee is an Affiliate of the
Company.
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______________________________
Signature
______________________________
Date
______________________________
Signature
Guarantee**
**
Signature must be guaranteed by a commercial bank, trust company or member firm
of the New York Stock Exchange.
TO
BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
The
undersigned represents and warrants that it is purchasing this Note for its own
account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a “qualified institutional buyer”
within the meaning of Rule 144A under the Securities Act of 1933, and is aware
that the sale to it is being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Company as the undersigned has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon the
undersigned’s foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
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Date:_________________________
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______________________________________
[Signature
of executive officer of purchaser]
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Name:
_______________________________________
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Title:
________________________________________
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