SAXON CAPITAL, INC., AS ISSUER, THE GUARANTORS NAMED ON THE SIGNATURE PAGES HERETO AND DEUTSCHE BANK TRUST COMPANY AMERICAS, AS TRUSTEE INDENTURE DATED AS OF MAY 4, 2006 12% SENIOR NOTES DUE 2014
EXHIBIT
4.01
EXECUTION
VERSION
SAXON
CAPITAL, INC.,
AS
ISSUER,
THE
GUARANTORS NAMED ON THE SIGNATURE PAGES HERETO
AND
DEUTSCHE
BANK TRUST COMPANY AMERICAS,
AS
TRUSTEE
DATED
AS OF MAY 4, 2006
12%
SENIOR NOTES DUE 2014
TABLE
OF CONTENTS
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ARTICLE
I
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Page
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DEFINITIONS
AND INCORPORATION BY REFERENCE
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SECTION
1.01.
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Definitions
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1
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SECTION
1.02.
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Other
Definitions
|
33
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SECTION
1.03.
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Incorporation
by Reference of Trust Indenture Act
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34
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SECTION
1.04.
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Rules
of Construction
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35
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SECTION
1.05.
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Acts
of Holders
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36
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ARTICLE
II
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THE
NOTES
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SECTION
2.01.
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Form
and Dating
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37
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SECTION
2.02.
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Execution
and Authentication
|
38
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|
SECTION
2.03.
|
Registrar
and Paying Agent
|
39
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SECTION
2.04.
|
Paying
Agent to Hold Money in Trust
|
39
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|
SECTION
2.05.
|
Holder
Lists
|
40
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|
SECTION
2.06.
|
Transfer
and Exchange
|
40
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SECTION
2.07.
|
Replacement
Notes
|
41
|
|
SECTION
2.08.
|
Outstanding
Notes
|
44
|
|
SECTION
2.09.
|
Treasury
Notes
|
44
|
|
SECTION
2.10.
|
Temporary
Notes
|
45
|
|
SECTION
2.11.
|
Cancellation
|
45
|
|
SECTION
2.12.
|
Defaulted
Interest
|
45
|
|
SECTION
2.13.
|
Record
Date
|
46
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|
SECTION
2.14.
|
Computation
of Interest
|
46
|
|
SECTION
2.15.
|
CUSIP
Number
|
46
|
|
SECTION
2.16.
|
Special
Transfer Provisions
|
46
|
|
SECTION
2.17.
|
Issuance
of Additional Notes
|
49
|
|
ARTICLE
III
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REDEMPTION
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|
SECTION
3.01.
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Notices
to Trustee
|
49
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|
SECTION
3.02.
|
Selection
of Notes to Be Redeemed
|
50
|
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SECTION
3.03.
|
Notice
of Redemption
|
5
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SECTION
3.04.
|
Effect
of Notice of Redemption
|
51
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SECTION
3.05.
|
Deposit
of Redemption Price
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51
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|
SECTION
3.06.
|
Notes
Redeemed in Part
|
51
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|
SECTION
3.07.
|
Optional
Redemption
|
51
|
|
SECTION
3.08.
|
Mandatory
Redemption or Xxxxxxxxxx
|
00
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|
SECTION
3.09.
|
Offer
to Purchase by Application of Net Proceeds
|
52
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ARTICLE
IV
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COVENANTS
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SECTION
4.01.
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Payment
of Notes
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54
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SECTION
4.02.
|
Maintenance
of Office or Agency
|
54
|
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SECTION
4.03.
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Reports
|
55
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|
SECTION
4.04.
|
Compliance
Certificate
|
56
|
|
SECTION
4.05.
|
Taxes
|
56
|
|
SECTION
4.06.
|
Stay,
Extension and Usury Laws
|
56
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|
SECTION
4.07.
|
Restricted
Payments
|
56
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SECTION
4.08.
|
Maintenance
of Total Unencumbered Assets
|
61
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SECTION
4.09.
|
Dividend
and Other Payment Restrictions Affecting Restricted
Subsidiaries
|
61
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|
SECTION
4.10.
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Limitation
on Incurrence of Additional Non-Funding Indebtedness
|
63
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|
SECTION
4.11.
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Limitation
on Asset Sales
|
64
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|
SECTION
4.12.
|
Additional
Restricted Subsidiary Guarantees
|
66
|
|
SECTION
4.13.
|
Transactions
with Affiliates
|
66
|
|
SECTION
4.14.
|
Liens
|
68
|
|
SECTION
4.15.
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Existence;
Conduct of Business
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68
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|
SECTION
4.16.
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Repurchase
at the Option of Holders upon a Change of Control
|
69
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SECTION
4.17.
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Excess
Cash Flow Offer
|
71
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SECTION
4.18.
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[Reserved]
|
72
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SECTION
4.19.
|
Application
of Suspension Covenants
|
72
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ARTICLE
V
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SUCCESSORS
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|
SECTION
5.01.
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Merger,
Consolidation, or Sale of Assets
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73
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|
SECTION
5.02.
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Successor
Corporation Substituted
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74
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SECTION
5.03.
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Merger
of Guarantors
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75
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ARTICLE
VI
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DEFAULTS
AND REMEDIES
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SECTION
6.01.
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Events
of Default
|
75
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SECTION
6.02.
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Acceleration
|
77
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SECTION
6.03.
|
Other
Remedies
|
77
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|
SECTION
6.04.
|
Waiver
of Existing Defaults
|
77
|
|
SECTION
6.05.
|
Control
by Majority
|
78
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|
SECTION
6.06.
|
Limitation
on Suits
|
78
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SECTION
6.07.
|
Rights
of Holders of Notes to Receive Payment
|
78
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SECTION
6.08.
|
Collection
Suit by Trustee
|
78
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SECTION
6.09.
|
Trustee
May File Proofs of Claim
|
79
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SECTION
6.10.
|
Priorities
|
79
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SECTION
6.11.
|
Undertaking
for Costs
|
80
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|
SECTION
6.12.
|
Restoration
of Rights and Remedies
|
80
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SECTION
6.13.
|
Rights
and Remedies Cumulative
|
80
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SECTION
6.14.
|
Delay
and Omission Not Waiver
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80
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ARTICLE
VII
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TRUSTEE
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SECTION
7.01.
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Duties
of Trustee
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80
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SECTION
7.02.
|
Rights
of Trustee
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82
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SECTION
7.03.
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Individual
Rights of Trustee
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83
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SECTION
7.04.
|
Trustee’s
Disclaimer
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83
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SECTION
7.05.
|
Notice
of Defaults
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83
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SECTION
7.06.
|
Reports
by Trustee to Holders of the Notes
|
83
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|
SECTION
7.07.
|
Compensation
and Indemnity
|
84
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|
SECTION
7.08.
|
Replacement
of Trustee
|
85
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SECTION
7.09.
|
Successor
Trustee by Merger, etc.
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85
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SECTION
7.10.
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Eligibility;
Disqualification
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86
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SECTION
7.11.
|
Preferential
Collection of Claims Against the Company
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86
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ARTICLE
VIII
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LEGAL
DEFEASANCE AND COVENANT DEFEASANCE
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SECTION
8.01.
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Option
to Effect Legal Defeasance or Covenant Defeasance
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86
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SECTION
8.02.
|
Legal
Defeasance and Discharge
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86
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SECTION
8.03.
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Covenant
Defeasance
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87
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SECTION
8.04.
|
Conditions
to Legal or Covenant Defeasance
|
87
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|
SECTION
8.05.
|
Deposited
Money and Government Securities to Be Held in Trust; Other Miscellaneous
Provisions
|
89
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SECTION
8.06.
|
Repayment
to Company
|
89
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|
SECTION
8.07.
|
Reinstatement
|
90
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ARTICLE
IX
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AMENDMENT,
SUPPLEMENT AND WAIVER
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|
SECTION
9.01.
|
Without
Consent of Holders of Notes
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90
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SECTION
9.02.
|
With
Consent of Holders of Notes
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91
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SECTION
9.03.
|
Compliance
with Trust Indenture Act
|
93
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|
SECTION
9.04.
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Revocation
and Effect of Consents
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93
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|
SECTION
9.05.
|
Notation
on or Exchange of Notes
|
93
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|
SECTION
9.06.
|
Trustee
to Sign Amendments, etc.
|
93
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SECTION
9.07.
|
Payments
for Consent
|
93
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ARTICLE
X
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|
GUARANTEE
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SECTION
10.01.
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Unconditional
Guarantee
|
94
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SECTION
10.02.
|
Severability
|
95
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|
SECTION
10.03.
|
Waiver
of Subrogation
|
95
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|
SECTION
10.04.
|
Execution
of Guarantee
|
96
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|
SECTION
10.05.
|
Waiver
of Stay, Extension or Usury Laws
|
96
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|
SECTION
10.06.
|
Release
of Guarantors
|
97
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ARTICLE
XI
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MISCELLANEOUS
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|
SECTION
11.01.
|
Trust
Indenture Act Controls
|
97
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|
SECTION
11.02.
|
Notices
|
97
|
|
SECTION
11.03.
|
Communication
by Holders of Notes with Other Holders of Notes
|
99
|
|
SECTION
11.04.
|
Certificate
and Opinion as to Conditions Precedent
|
99
|
|
SECTION
11.05.
|
Statements
Required in Certificate or Opinion
|
99
|
|
SECTION
11.06.
|
Rules
by Trustee and Agents
|
100
|
|
SECTION
11.07.
|
No
Personal Liability of Directors, Officers, Employees, Incorporators,
Members and Stockholders
|
100
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|
SECTION
11.08.
|
Governing
Law
|
100
|
|
SECTION
11.09.
|
No
Adverse Interpretation of Other Agreements
|
100
|
|
SECTION
11.10.
|
Successors
|
100
|
|
SECTION
11.11.
|
Severability
|
100
|
|
SECTION
11.12.
|
Counterpart
Originals
|
100
|
|
SECTION
11.13.
|
Table
of Contents, Headings, etc.
|
100
|
|
SECTION
11.14.
|
Qualification
of Indenture
|
100
|
|
ARTICLE
XII
|
||
|
SATISFACTION
AND DISCHARGE
|
||
|
SECTION
12.01.
|
Satisfaction
and Discharge of Indenture
|
101
|
|
SECTION
12.02.
|
Application
of Trust Money
|
102
|
|
|
||
|
ARTICLE
XIII
|
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|
SUBORDINATION
OF CERTAIN GUARANTEES
|
||
|
SECTION
13.01.
|
Agreement
to Subordinate
|
102
|
|
SECTION
13.02.
|
Liquidation,
Dissolution, Bankruptcy
|
102
|
|
SECTION
13.03.
|
Default
on Senior Indebtedness of a Servicing Guarantor
|
103
|
|
SECTION
13.04.
|
Demand
for Payment
|
104
|
|
SECTION
13.05.
|
When
Distribution Must Be Paid Over
|
104
|
|
SECTION
13.06.
|
Subrogation
|
104
|
|
SECTION
13.07.
|
Relative
Rights
|
104
|
|
SECTION
13.08.
|
Subordination
May Not Be Impaired by a Servicing Guarantor
|
105
|
|
SECTION
13.09.
|
Rights
of Trustee and Paying Agent
|
105
|
|
SECTION
13.10.
|
Distribution
or Notice to Representative
|
105
|
|
SECTION
13.11.
|
Article
XIII Not to Prevent Events of Default or Limit Right To Demand
Payment
|
105
|
|
SECTION
13.12.
|
Trust
Moneys Not Subordinated
|
105
|
|
SECTION
13.13.
|
Trustee
Entitled to Rely
|
106
|
|
SECTION
13.14.
|
Trustee
to Effectuate Subordination
|
106
|
|
SECTION
13.15.
|
Trustee
Not Fiduciary for Holders of Senior Indebtedness of Servicing
Guarantors
|
106
|
|
SECTION
13.16.
|
Reliance
by Holders of Senior Indebtedness of a Servicing Guarantor on
Subordination Provisions
|
106
|
Exhibits:
Exhibit
A Form
of
Note
Exhibit
B Form
of
Certificate to Be Delivered in Connection with Transfers Pursuant to Rule
144A
Exhibit
C Form
of
Certificate to Be Delivered in Connection with Transfers Pursuant to
Regulation S
Exhibit
D Form
of
Certificate from Acquiring Accredited Investor
CROSS-REFERENCE
TABLE
|
TIA
Section
|
Indenture
Section
|
|
|
310
|
(a)(1)
|
7.10
|
|
(a)(2)
|
7.10
|
|
|
(a)(3)
|
N/A
|
|
|
(a)(4)
|
N/A
|
|
|
(b)
|
7.08;
7.10
|
|
|
(c)
|
N/A
|
|
|
311
|
(a)
|
7.11
|
|
(b)
|
7.11
|
|
|
(c)
|
N/A
|
|
|
312
|
(a)
|
2.05
|
|
(b)
|
11.03
|
|
|
(c)
|
11.03
|
|
|
313
|
(a)
|
7.06
|
|
(b)(1)
|
N/A
|
|
|
(b)(2)
|
7.06
|
|
|
(c)
|
11.02
|
|
|
(d)
|
7.06
|
|
|
314
|
(a)
|
4.03;
4.04
|
|
(b)
|
N/A
|
|
|
(c)(1)
|
11.04
|
|
|
(c)(2)
|
11.04
|
|
|
(c)(3)
|
11.04
|
|
|
(d)
|
N/A
|
|
|
(e)
|
11.05
|
|
|
(f)
|
N/A
|
|
|
315
|
(a)
|
7.01
|
|
(b)
|
7.05;
12.02
|
|
|
(c)
|
7.01
|
|
|
(d)
|
7.01
|
|
|
(e)
|
6.11
|
|
|
316
|
(a)
(last sentence)
|
2.09
|
|
(a)(1)(A)
|
6.05
|
|
|
(a)(1)(B)
|
6.04
|
|
|
(a)(2)
|
N/A
|
|
|
(b)
|
6.07
|
|
|
317(a)(1)
|
6.08
|
|
|
(a)(2)
|
6.09
|
|
|
(b)
|
2.04
|
|
|
318
|
(a)
|
1.01
|
N/A
means
Not Applicable
|
Note:
|
This
Cross-Reference Table shall not, for any purpose, be deemed to
be part of
this Indenture.
|
INDENTURE
dated as of May 4, 2006 among Saxon Capital, Inc., a Maryland corporation
(as
further defined below, the “Company”),
the
Guarantors (the “Guarantors”)
and
Deutsche Bank Trust Company Americas, as trustee (the “Trustee”).
The
Company, the Guarantors and the Trustee agree as follows for the benefit
of each
other and for the equal and ratable benefit of the Holders of the
Notes:
ARTICLE
I
DEFINITIONS
AND INCORPORATION BY REFERENCE
SECTION
1.01. Definitions.
“Accredited
Investor”
means
an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3)
or (7) under the Securities Act).
“Acquired
Indebtedness”
means
Indebtedness of a Person or any of its Restricted Subsidiaries existing at
the
time such Person becomes a Restricted Subsidiary of the Company or at the
time
it merges or consolidates with the Company or any of its Restricted Subsidiaries
or assumed in connection with the acquisition of assets from such Person
and in
each case not incurred by such Person in connection with, or in anticipation
or
contemplation of, such Person becoming a Restricted Subsidiary of the Company
or
such acquisition, merger or consolidation.
“Additional
Notes”
means
any Notes issued under this Indenture (including Initial Additional Notes)
in
addition to the Initial Notes (other than any Notes issued in respect of
Initial
Notes pursuant to Section 2.06, 2.07, 2.10, 3.06, 3.09, 4.11, 4.16, 4.17
or
9.05).
“Affiliate”
means,
with respect to any specified Person, any other Person who directly or
indirectly through one or more intermediaries, controls, or is controlled
by, or
is under common control with, such specified Person. The term “control” means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise; and the terms
“controlling” and “controlled” have meanings correlative of the
foregoing.
“Agent”
means
any Registrar or Paying Agent.
“Applicable
Premium”
means,
with respect to any Note on any applicable redemption date, the greater
of:
(1) 1.0%
of
the principal amount of such Note; and
(2) the
excess, if any, of:
(a) the
present value at such redemption date of (i) the outstanding principal amount
of
such Note at its final maturity plus (ii) all required interest payments
(excluding accrued and unpaid interest to such redemption date) due on such
Note
through its final maturity, computed using a discount rate equal to the Treasury
Rate as of such redemption date plus 50 basis points; over
(b) the
principal amount of such Note.
“Asset
Acquisition”
means:
(1) an Investment by the Company or any Restricted Subsidiary of the Company
in
any other Person pursuant to which such Person shall become a Restricted
Subsidiary of the Company or of any Restricted Subsidiary of the Company,
or
shall be merged with or into the Company or any Restricted Subsidiary of
the
Company; or (2) the acquisition by the Company or any Restricted Subsidiary
of
the Company of the assets of any Person (other than a Restricted Subsidiary
of
the Company) that constitute all or substantially all of the assets of such
Person or comprise any division or line of business of such Person or any
other
properties or assets of such Person other than in the ordinary course of
business.
“Asset
Sale”
means
any direct or indirect sale, issuance, conveyance, transfer, lease, assignment
or other transfer for value by the Company or any of its Restricted Subsidiaries
(including any sale and leaseback transaction) to any Person of (A) shares
of
Capital Stock of a Restricted Subsidiary, (B) all or substantially all the
assets of any division or line of operating business of the Company or any
Restricted Subsidiary or (C) any other assets of the Company or any Restricted
Subsidiary.
Notwithstanding
the preceding, the following items shall not be deemed to be Asset
Sales:
(1) the
sale,
lease, conveyance, disposition or other transfer of all or substantially
all of
the assets of the Company as permitted by Section 5.01 hereof;
(2) a
transfer of assets or an issuance of Capital Stock by a Restricted Subsidiary
to
the Company or to another Restricted Subsidiary or a transfer of assets by
the
Company to a Restricted Subsidiary;
(3) solely
for purposes of Section 4.11, a Permitted Investment or a Restricted Payment
that is permitted by Section 4.07 (including any formation of or contribution
of
assets to a Subsidiary or a joint venture);
(4) leases
or
subleases to third parties, of real property owned in fee or leased by the
Company or its Subsidiaries or a disposition or assignment (as lessor) of
a
lease of real property, or a license of intellectual property, in each case,
in
the ordinary course of business;
(5) any
disposition of property or assets (including inventory and accounts receivable)
of the Company or any of its Subsidiaries in the ordinary course of business,
or
that in the reasonable judgment of the Company, have become uneconomic, obsolete
or worn out;
(6) the
disposition of Cash Equivalents or cash;
(7) the
sale
or other disposition of Capital Stock of, or other Investments in, any
Unrestricted Subsidiary;
(8) the
sale
or
other disposition of Receivables, Residual Interests, net interest margin
securities, Securitization Securities and other direct or indirect interests
in
Securitization Vehicles and related assets, in each case in the ordinary
course
of business (including by way of a Securitization);
(9) Permitted
Liens;
(10) without
limitation of clause (8), the sale of delinquent loans to unaffiliated third
parties;
and
(11) the
disposition of assets with a Fair Market Value of less than $2.5
million.
“Bankruptcy
Law”
means
Title 11, U.S. Code or any federal or state law of any jurisdiction relating
to
bankruptcy, insolvency, winding up, liquidation, reorganization or relief
of
debtors.
“Beneficial
Owner”
has
the
meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the
Exchange Act.
“Board
of Directors”
means,
as to any Person, the board of directors (or similar governing body) of such
Person or any duly authorized committee thereof. Unless otherwise specified,
“Board of Directors” means the Board of Directors of the Company.
“Board
Resolution”
means,
with respect to any Person, a copy of a resolution certified by the Secretary
or
an Assistant Secretary of such Person to have been duly adopted by the Board
of
Directors of such Person and to be in full force and effect on the date of
such
certification. Unless otherwise specified “Board Resolution” means a Board
Resolution of the Company.
“Business
Day”
means
any day other than a Legal Holiday.
“Capital
Stock”
means:
(1) with
respect to any Person that is a corporation, any and all shares, interests,
participations or other equivalents (however designated and whether or not
voting) of corporate stock, including each class of Common Stock and Preferred
Stock of such Person; and
(2) with
respect to any Person that is not a corporation, any and all partnership,
membership or other equity interests of such Person.
“Capitalized
Lease Obligation”
means,
as to any Person, the obligations of such Person under a lease that are required
to be classified and accounted for as capital lease obligations under GAAP
and,
for purposes of this definition, the amount of such obligations at any date
shall be the capitalized amount of such obligations at such date, determined
in
accordance with GAAP and the final maturity thereof will be the date of the
last
payment of rent or any other amount due under such lease prior to the first
date
such lease may be terminated without penalty.
“Cash
Equivalents”
means:
(1) marketable
direct obligations issued by, or unconditionally guaranteed by, the United
States government or issued by any agency thereof and backed by the full
faith
and credit of the United States, in each case maturing within one year from
the
date of acquisition thereof;
(2) marketable
direct obligations issued by any state of the United States of America or
any
political subdivision of any such state or any public instrumentality thereof
maturing within one year from the date of acquisition thereof and, at the
time
of acquisition, having one of the two highest ratings obtainable from either
S&P or Xxxxx’x;
(3) commercial
paper maturing no more than one year from the date of creation thereof and,
at
the time of acquisition, having a rating of at least A-1 from S&P or at
least P-1 from Xxxxx’x;
(4) certificates
of deposit or bankers’ acceptances maturing within one year from the date of
acquisition thereof issued by any bank organized under the laws of the United
States of America or any state thereof or the District of Columbia or any
U.S.
branch of a foreign bank having at the date of acquisition thereof combined
capital and surplus of not less than $250.0 million;
(5) repurchase
obligations with a term of not more than seven days for underlying securities
of
the types described in clause (1) above entered into with any bank meeting
the qualifications specified in clause (4) above; and
(6) investments
in money market funds that invest substantially all their assets in securities
of the types described in clauses (1) through (5) above.
“Change
of Control”
means
the occurrence of one or more of the following events:
(1) any
sale,
lease, exchange or other transfer (in one transaction or a series of related
transactions) of all or substantially all of the assets of the Company to
any
Person or group of related Persons for purposes of Section 13(d) of the Exchange
Act (a “Group”),
together with any Affiliates thereof (whether or not otherwise in compliance
with the provisions of this Indenture), unless more than 65% of the aggregate
ordinary voting power represented by the issued and outstanding Capital Stock
of
such transferee Person is owned, immediately following such transaction,
by
Persons who owned ordinary voting stock of the Company immediately prior
to such
transaction;
(2) the
approval by the holders of Capital Stock of the Company of any plan or proposal
for the liquidation or dissolution of the Company (whether or not otherwise
in
compliance with the provisions of this Indenture);
(3) any
Person or Group shall become the owner, directly or indirectly, beneficially
or
of record, of shares representing more than 35% of the aggregate ordinary
voting
power represented by the issued and outstanding Capital Stock of the Company;
or
(4) the
replacement of a majority of the Board of Directors over a two-year period
from
the directors who constituted the Board of Directors at the beginning of
such
period, and such replacement shall not have been approved by a vote of at
least
a majority of the Board of Directors then still in office who either were
members of such Board of Directors at the beginning of such period or whose
election as a member of such Board of Directors was previously so
approved.
“Clearstream”
means
Clearstream Banking, société anonyme (formerly Cedelbank).
“Code”
means
the Internal Revenue Code of 1986, as amended.
“Common
Stock”
of
any
Person means any and all shares, interests or other participations in, and
other
equivalents (however designated and whether voting or non-voting) of such
Person’s common stock, whether outstanding on the Measurement Date or issued
after the Measurement Date, and includes, all series and classes of such
common
stock.
“Company”
means
Saxon Capital, Inc., a Maryland corporation, and any successor Person
thereto.
“Consolidated
Depreciation of Fixed Assets”
means,
with respect to any Person for any period depreciation of fixed assets expense
of such Person and its Restricted Subsidiaries for such period determined
on a
consolidated basis in accordance with GAAP.
“Consolidated
EBITDA”
means,
with respect to any Person, for any period, the sum (without duplication)
of:
(1) Consolidated
Net Income; plus
(2) to
the
extent Consolidated Net Income has been reduced thereby:
(a) all
income taxes, franchise and similar taxes of such Person and its Restricted
Subsidiaries paid or accrued in accordance with GAAP for such
period;
(b) Consolidated
Interest Expense;
(c) Consolidated
Depreciation of Fixed Assets for such period;
(d) amortization
expense, including the amortization of Mortgage Servicing Rights and
amortization of deferred financing costs, but excluding (i) amortization
of loan
origination and acquisition costs and (ii) amortization of deferred financing
costs related to Funding Indebtedness;
(e) the
amount of any severance or restructuring charge or reserve deducted (and
not
added back) in such period in computing Consolidated Net Income;
(f) any
other
non-cash charges (including any write-offs or write-downs of goodwill, deferred
financing costs (other than related to Funding Indebtedness) and other assets)
reducing Consolidated Net Income for such period (provided
that if
any such non-cash charges represent an accrual or reserve for potential cash
items in any future period, the cash payment in respect thereof in such future
period shall be subtracted from Consolidated EBITDA to such extent during
such
future period, and excluding amortization of a prepaid cash item that was
paid
in a prior period); and
(g) expenses
and charges related to any equity offering, incurrence of Indebtedness,
Permitted Investment or acquisition or divestiture permitted to be incurred
or
made under this Indenture (including any such expenses or charges relating
to
the success and transition bonuses); plus (minus)
(3) to
the
extent Consolidated Net Income has been reduced (increased) thereby, items
classified as non-recurring losses (gains); provided
that
such losses (gains) are not reasonably likely to recur within two years or
there
was a similar loss (gain) within the prior two years;
all
as
determined on a consolidated basis for such Person and its Restricted
Subsidiaries in accordance with GAAP.
“Consolidated
Interest Expense”
means,
with respect to any Person for any period, the sum of, without
duplication:
(1) the
aggregate of the interest expense of such Person and its Restricted Subsidiaries
for such period determined on a consolidated basis in accordance with GAAP
(other than interest expense with respect to Funding Indebtedness), including
(a) any amortization of debt discount; (b) the net costs under
Interest Swap Obligations (whether or not related to Funding Indebtedness);
(c) all capitalized interest; and (d) the interest portion of any
deferred payment obligation;
(2) to
the
extent not already included in clause (1), the interest component of
Capitalized Lease Obligations paid, accrued and/or scheduled to be paid or
accrued by such Person and its Restricted Subsidiaries during such period
as
determined on a consolidated basis in accordance with GAAP; and
(3) the
amount of all dividend payments on any series of Disqualified Capital Stock
or
Preferred Stock of such Person (other than Preferred Stock of the Company)
and,
to the extent permitted under this Indenture, its Restricted Subsidiaries
(other
than dividends paid in Qualified Capital Stock) paid, accrued or scheduled
to be
paid or accrued during such period.
“Consolidated
Net Income”
means,
with respect to any Person, for any period, the aggregate net income (or
loss)
of such Person and its Restricted Subsidiaries before the payment of dividends
on Preferred Stock of such Person for such period on a consolidated basis,
determined in accordance with GAAP; provided
that
there shall be excluded therefrom:
(1) gains
or
losses from Asset Sales or abandonments or reserves relating
thereto;
(2) items
classified as extraordinary gains or losses and direct impairment charges
or the
reversal of such charges on the Company’s assets;
(3) the
net
income (but not loss) of any Restricted Subsidiary of such Person to the
extent
that the declaration of dividends or similar distributions by that Restricted
Subsidiary of that income is restricted by a contract, operation of law or
otherwise, except (x) for such restrictions permitted by clauses (b), (f),
(g),
(h), (i) (to the extent relating to such clause (b)) or clause (m) of Section
4.09, whether such permitted restrictions exist on the Measurement Date or
are
created thereafter, and (y) to the extent distributions are actually made
during
such period or after such period and prior to the relevant date of
determination;
(4) the
net
income or loss of any other Person, other than a Consolidated Restricted
Subsidiary of the referent Person, except:
(a) to
the
extent (in the case of net income) of cash dividends or distributions paid
to
the referent Person, or to a Restricted Subsidiary of the referent Person
(subject, however, to clause (3) above), by such other Person;
or
(b) that
the
referent Person’s share of any net income or loss of such other Person under the
equity method of accounting for Affiliates shall not be excluded;
(5) any
restoration to income of any contingency reserve of an extraordinary,
nonrecurring or unusual nature, except to the extent that provision for such
reserve was made out of Consolidated Net Income accrued at any time following
the Measurement Date;
(6) income
or
loss attributable to discontinued operations (including operations disposed
of
during such period whether or not such operations were classified as
discontinued);
(7) any
unrealized non-cash gains or losses or charges in respect of Hedging Obligations
(including those resulting from the application of SFAS 133);
(8) any
non-cash compensation charge arising from any grant of stock, stock options
or
other equity-based awards; provided
that the
proceeds resulting from any such grant will be excluded from clause (iii)(v)
of
the first paragraph of Section 4.07; and
(9) the
cumulative effect of a change in accounting principles (effected either through
cumulative effect adjustment or a retroactive application, in each case,
in
accordance with GAAP).
“Consolidated
Net Worth”
of
any
Person means the consolidated stockholders’ equity of such Person, as of the
specified date (in the case of Section 4.08) or otherwise as of the end of
the
last completed fiscal quarter ending on or prior to the date of the transaction
giving rise to the need to calculate Consolidated Net Worth for which internal
financial statements are available, determined on a consolidated basis in
accordance with GAAP, less (without duplication) amounts attributable to
Disqualified Capital Stock of such Person and interests in such Person’s
Consolidated Restricted Subsidiaries not owned, directly or indirectly, by
such
Person, as of such date.
“Consolidated
Non-Funding Indebtedness Interest Coverage Ratio”
means,
with respect to any Person, the ratio of (i) Consolidated EBITDA of such
Person
during the four full fiscal quarters (the “Four
Quarter Period”)
ended
most recently prior to the date of the transaction giving rise to the need
to
calculate the Consolidated Non-Funding Indebtedness Interest Coverage Ratio
(the
“Transaction
Date”)
for
which internal financial statements are available to (ii) Consolidated Interest
Expense of such Person for the Four Quarter Period. In addition to the
foregoing, for purposes of this definition, “Consolidated EBITDA” and
“Consolidated Interest Expense” shall be calculated after giving effect on a
pro
forma
basis
for the period of such calculation to:
(1) the
incurrence or repayment of any Non-Funding Indebtedness of such Person or
any of
its Restricted Subsidiaries (and the application of the proceeds thereof)
giving
rise to the need to make such calculation and any incurrence or repayment
of
other Non-Funding Indebtedness (and the application of the proceeds thereof),
other than (i) the incurrence or repayment of Non-Funding Indebtedness in
the
ordinary course of business for working capital purposes pursuant to working
capital facilities, occurring during the Four Quarter Period or at any time
subsequent to the last day of the Four Quarter Period and on or prior to
the
Transaction Date and (ii) the incurrence of Permitted Indebtedness on (but
not
prior to) the Transaction Date, in each case as if such incurrence or repayment,
as the case may be (and the application of the proceeds thereof), occurred
on
the first day of the Four Quarter Period; and
(2) any
Asset
Sales or Asset Acquisitions (including any Asset Acquisition giving rise
to the
need to make such calculation as a result of such Person or one of its
Restricted Subsidiaries (including any Person who becomes a Restricted
Subsidiary as a result of the Asset Acquisition) incurring, assuming or
otherwise being liable for Acquired Indebtedness and also including any
Consolidated EBITDA (including any pro
forma
expense
and cost reductions determined in good faith by the Board of Directors to
be
(x) reasonably expected to be realized within six months of the Asset
Acquisition; provided
that if
such expense or cost reductions are not actually achieved within such six
month
period, only the amount actually realized shall be taken in to account after
such six month period or (y) calculated on a basis consistent with
Regulation S-X under the Exchange Act) attributable to the assets which are
the subject of the Asset Acquisition or
Asset
Sale during the Four Quarter Period) occurring during the Four Quarter Period
or
at any time subsequent to the last day of the Four Quarter Period and on
or
prior to the Transaction Date, as if such Asset Sale or Asset Acquisition
(including the incurrence, assumption or liability for any such Acquired
Indebtedness) occurred on the first day of the Four Quarter Period.
If
such
Person or any of its Restricted Subsidiaries directly or indirectly guarantees
Indebtedness of a third Person, the preceding sentence shall give effect
to the
incurrence of such guaranteed Indebtedness as if such Person or any Restricted
Subsidiary of such Person had directly incurred or otherwise assumed such
guaranteed Indebtedness.
Furthermore,
in calculating “Consolidated Interest Expense” for purposes of determining the
denominator of this “Consolidated Non-Funding Indebtedness Interest Coverage
Ratio”:
(1) interest
on outstanding Indebtedness determined on a fluctuating basis as of the
Transaction Date and which will continue to be so determined thereafter shall
be
deemed to have accrued at a fixed rate per annum equal to the rate of interest
on such Indebtedness in effect on the Transaction Date; and
(2) notwithstanding
clause (1) above, interest on Indebtedness determined on a fluctuating
basis, to the extent such interest is covered by agreements relating to Interest
Swap Obligations, shall be deemed to accrue at the rate per annum resulting
after giving effect to the operation of such agreements.
“Consolidated
Restricted Subsidiary”
means,
with respect to any Person, a Restricted Subsidiary of such Person, the
financial statements of which are consolidated with the financial statements
of
such Person in accordance with GAAP.
“Consolidated
Tangible Net Worth”
of
any
Person means the Consolidated Net Worth of such Person, excluding goodwill
as of
the date used to calculate Consolidated Net Worth.
“Corporate
Trust Office of the Trustee”
shall
be at the address of the Trustee specified in Section 11.02 or such other
address as to which the Trustee may give notice to the Company.
“Credit
Enhancement Agreements”
means,
collectively, any documents, instruments, guarantees or agreements entered
into
by the Company or any of its Restricted Subsidiaries for the purpose of
providing credit support (that is reasonably customary as determined by Company
senior management) with respect to any Funding Indebtedness.
“Currency
Agreement”
means
any foreign exchange contract, currency swap agreement, future contract,
options
on future contracts or other similar agreement or arrangement designed to
protect the Company or any Restricted Subsidiary of the Company against
fluctuations in currency values.
“Default”
means
an event or condition the occurrence of which is, or with the lapse of time
or
the giving of notice or both would be, an Event of Default.
“Definitive
Note”
means
a
certificated Note registered in the name of the Holder thereof and issued
in
accordance with Section 2.06, substantially in the form of Exhibit A
hereto, except that such Note shall not bear the Global Note Legend and shall
not have the “Schedule of Exchanges of Interests in the Global Note” attached
thereto.
“Depositary”
means,
with respect to the Global Notes, the Person specified in Section 2.03 as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
“Disqualified
Capital Stock”
means
that portion of any Capital Stock that, by its terms (or by the terms of
any
security into which it is convertible or for which it is exchangeable at
the
option of the holder thereof), or upon the happening of any event (other
than an
event which would constitute a Change of Control), matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the sole option of the holder thereof (except, in each case, upon the
occurrence of a Change of Control) on or prior to the final maturity date
of the
Notes.
“Domestic
Restricted Subsidiary”
means
a
Restricted Subsidiary incorporated or otherwise organized or existing under
the
laws of the United States, any state thereof or any territory or possession
of
the United States.
“Equity
Offering”
means
an underwritten public offering of Qualified Capital Stock of the Company
pursuant to a registration statement filed with the SEC in accordance with
the
Securities Act.
“Euroclear”
means
Xxxxxx Guaranty Trust Company of New York, Brussels office, as operator of
the
Euroclear system.
“Excess
Cash Flow”
means,
for any Excess Cash Flow Period, net income (or loss) of the Taxable REIT
Subsidiaries calculated on a consolidated basis in accordance with GAAP
plus,
in each
case to the extent subtracted in calculating such net income and without
duplication, the sum of the following, in each case for such Excess Cash
Flow
Period (except to the extent otherwise expressly provided) and determined
for
the Taxable REIT Subsidiaries on a consolidated basis in accordance with
GAAP:
(a) provision
for mortgage loan losses;
(b) Consolidated
Depreciation of Fixed Assets;
(c) any
unrealized non-cash losses or charges in respect of Hedging Obligations
(including those resulting from the application of SFAS 133);
(d) non-cash
losses from the sale, conveyance, transfer or other disposition of loans
and
other mortgage-related receivables (including Servicing Receivables, Mortgage
Servicing Rights, Residual Interests and net interest margin
securities);
(e) if
deducted in calculating net income of the Taxable REIT Subsidiaries, the
cumulative effect of a change in accounting principles (effected either through
cumulative effect adjustment or a retroactive application);
(f) any
non-cash compensation charge arising from any grant of stock, stock options
or
other equity-based awards;
(g) the
amount of any non-cash severance or restructuring charge or
reserve;
(h) all
income taxes, franchise and similar taxes of the Taxable REIT Subsidiaries
paid
or accrued in accordance with GAAP; and
(i) amortization
expense, including the amortization of Mortgage Servicing Rights and
amortization of deferred financing costs, but excluding (x) amortization
of loan
origination and acquisition costs and (y) amortization of deferred financing
costs related to Funding Indebtedness;
minus
in each
case to the extent not subtracted in calculating net income and without
duplication, the sum of the following, in each case for such Excess Cash
Flow
Period (except to the extent otherwise expressly provided) and determined
for
the Taxable REIT Subsidiaries on a consolidated basis in accordance with
GAAP:
(i)any
unrealized non-cash gains in respect of Hedging Obligations (including those
resulting from the application of SFAS 133);
(ii)non-cash
gains from the sale, conveyance, transfer or other disposition of loans and
other mortgage-related receivables (including Servicing Receivables, Mortgage
Servicing Rights, Residual Interests and net interest margin
securities);
(iii)if
an
addition in calculating net income of the Taxable REIT Subsidiaries, the
cumulative effect of a change in accounting principles (effected either through
cumulative effect adjustment or a retroactive application, in each case,
in
accordance with GAAP);
(iv)(x)
the
value of Receivables (including Servicing Receivables, Residual Interests
and
net interest margin securities, but excluding Mortgage Servicing Rights)
acquired during such Excess Cash Flow Period less the aggregate principal
amount
of Indebtedness incurred solely to finance such acquisitions and (y) the
value
of Receivables (including Servicing Receivables, Residual Interests and net
interest margin securities, but excluding Mortgage Servicing Rights) that
the
Taxable REIT Subsidiaries have become contractually obligated during such
Excess
Cash Flow Period to acquire within 90 days after the last day of such Excess
Cash Flow Period less the aggregate principal
amount
of
Indebtedness senior management of the Company expects, in its good faith
judgment, to incur solely to finance such acquisitions;
(v)(x)
the
value of Mortgage Servicing Rights acquired during such Excess Cash Flow
Period
less the aggregate principal amount of Indebtedness incurred solely to finance
such acquisitions and (y) the value of Mortgage Servicing Rights that the
Taxable REIT Subsidiaries have become contractually obligated during such
Excess
Cash Flow Period to acquire within 90 days after the last day of such Excess
Cash Flow Period less the aggregate principal amount of Indebtedness senior
management of the Company expects, in its good faith judgment, to incur solely
to finance such acquisitions;
(vi)(x)
capital expenditures made during such Excess Cash Flow Period less the proceeds
received during such Excess Cash Flow Period of any Indebtedness incurred
to
finance such capital expenditures and (y) the amount of capital expenditures
that the Taxable REIT Subsidiaries have become contractually obligated during
such Excess Cash Flow Period to make within 90 days after the last day of
such
Excess Cash Flow Period less the aggregate principal amount of Indebtedness
senior management of the Company expects, in its good faith judgment, to
incur
solely to finance such capital expenditures;
(vii)all
income taxes, franchise and similar taxes of the Taxable REIT Subsidiaries
paid
in cash during such Excess Cash Flow Period;
(viii)amounts
paid (including by way of funding any intercompany Indebtedness) to the Company
or any of its Subsidiaries that are qualified REIT subsidiaries which, in
the
good faith judgment of senior management of the Company, were used or will
be
used within 90 days after the last day of such Excess Cash Flow Period to
(x)
make interest payments on the Notes or (y) make the dividends or distributions
referred to in clause (5) of the second paragraph of Section 4.07; provided
that to
the extent such dividends or distributions are to be made within 90 days
after
the last day of such Excess Cash Flow Period, such dividends or distributions
shall have been declared during such Excess Cash Flow Period;
(ix)the
amount of Investments made pursuant to (A) clause (1) of the definition of
Permitted Investments in a Person that becomes a Restricted Subsidiary as
a
result of such Investment, or (B) clause (2) of the definition of Permitted
Investments, in each case except and solely to the extent that such Investment
is funded with non-cash consideration or the cash proceeds from the incurrence
of Indebtedness or the issuance of Capital Stock; and
(x)the
amount used to repurchase or otherwise redeem Notes pursuant to Section 3.07(2),
4.11, 4.16 or 4.17 in each case solely to the extent that such repurchases
or
redemptions are not financed with the cash proceeds from the incurrence of
Indebtedness or the issuance of Capital Stock.
“Exchange
Act”
means
the Securities Exchange Act of 1934, as amended.
“Exchange
Notes”
means
Notes containing terms substantially identical to the Initial Notes or any
Initial Additional Notes (except that (i) such Exchange Notes shall not
contain terms with respect to transfer restrictions and shall be registered
under the Securities Act and (ii) certain provisions relating to an
increase in the stated rate of interest thereon shall be eliminated), that
are
issued and exchanged for (a) the Initial Notes, as provided for in the
Registration Rights Agreement relating to such Initial Notes and this Indenture
or (b) such Initial Additional Notes, as may be provided in any
Registration Rights Agreement relating to such Initial Additional Notes and
this
Indenture (including any amendment or supplement thereto).
“Excluded
Subsidiary”
means
Saxon Securities and Certificates, Inc., a Maryland corporation, and TRS
Securities and Certificates, Inc., a Maryland corporation, and any other
bankruptcy remote subsidiaries principally engaged in holding Residual
Interests.
“Fair
Market Value”
means,
with respect to any asset or property, the price which could be negotiated
in an
arm’s-length, free market transaction, for cash, between a willing seller and
a
willing and able buyer, neither of whom is under undue pressure or compulsion
to
complete the transaction. Other than with respect to the Intangible Valuation
Report, Fair Market Value shall be determined by the senior management of
the
Company when the fair market value of any asset other than cash is estimated
in
good faith to be below $20.0 million and by the Board of Directors acting
reasonably and in good faith in each other case in which case Fair Market
Value
shall be evidenced by a Board Resolution of the Board of Directors delivered to
the Trustee.
"Four
Quarter Period"
has the
meaning ascribed to such term in the definition of Consolidated Non-Funding
Indebtedness Interest Coverage Ratio.
“Funding
Indebtedness”
means
(i) any Permitted Warehouse Indebtedness and any Permitted Securitization
Indebtedness of the Company or any of its Restricted Subsidiaries, (ii) any
Residual or Servicing Interests Funding Indebtedness and (iii) any Indebtedness
Refinancing any of the Indebtedness under clause (i) or (ii) and advanced
to the
Company or any of its Restricted Subsidiaries based upon, and secured by,
Receivables, REO Assets, Residual or Servicing Interests or net interest
margin
securities; provided,
however
that the
excess (determined as of the most recent date for which internal financial
statements are available), if any, of (x) the amount of any Indebtedness
advanced in accordance with this clause (iii) for which the holder thereof
has
contractual recourse to the Company or its Restricted Subsidiaries to satisfy
claims with respect thereto over (y) the aggregate (without duplication of
amounts) Realizable Value of the assets which secure such Indebtedness shall
not
be Funding Indebtedness (but shall not be deemed to be a new incurrence of
Non-Funding Indebtedness except with respect to, and solely to the extent
of,
any such excess that exists upon the initial incurrence of such Indebtedness
advanced under this clause (iii)). The amount of any Funding Indebtedness
shall
be determined in accordance with the definition of “Indebtedness.”
“GAAP”
means
generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute
of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other entity
as
may be approved by a significant segment of the accounting profession of
the
United States, which are in effect from time to time.
“Global
Note Legend”
means
the legend set forth in Section 2.06(f)(ii), which is required to be placed
on all Global Notes issued under this Indenture.
“Global
Notes”
means,
individually and collectively, each of the Restricted Global Notes and the
Unrestricted Global Notes.
“Government
Securities”
means
direct obligations of, or obligations guaranteed by, the United States of
America, and the payment for which the United States pledges its full faith
and
credit.
“Guarantee”
means
a
guarantee of the Notes by a Guarantor.
“Guarantor”
means
(1) each of the Company’s Domestic Restricted Subsidiaries in existence on the
Measurement Date (other than Securitization Vehicles and Excluded Subsidiaries)
and (2) each of the Company’s Domestic Restricted Subsidiaries (other than
Securitization Vehicles and Excluded Subsidiaries) that in the future executes
a
supplemental indenture in which such Restricted Subsidiary agrees to be bound
by
the terms of this Indenture as a Guarantor in accordance with the terms of
this
Indenture; provided
that any
Person constituting a Guarantor as described above shall cease to constitute
a
Guarantor when its respective Guarantee is released in accordance with the
terms
of this Indenture.
“Hedging
Obligations”
means,
with respect to any Person, the Obligations of such Person under any Interest
Swap Obligations, Currency Agreements or similar agreements providing for
the
transfer or mitigation of interest rate or currency risks either generally
or
under specific contingencies.
“Holder”
means
a
holder of the Notes.
“IAI
Global Note”
means
a
global note substantially in the form of Exhibit A hereto bearing the
Global Note Legend and the Private Placement Legend and deposited with or
on
behalf of, and registered in the name of, the Depositary or its nominee that
will be issued (or the principal amount of which will be increased) in
connection with a transfer to Accredited Investors pursuant to Section
2.06(c).
“Indebtedness”
means
with respect to any Person, without duplication:
(1) all
Obligations of such Person for borrowed money;
(2) all
Obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;
(3) all
Capitalized Lease Obligations of such Person;
(4) all
Obligations of such Person issued or assumed as the deferred purchase price
of
property, all conditional sale obligations and all Obligations under any
title
retention agreement (but excluding trade accounts payable and other accrued
liabilities arising in the ordinary course of business that are not overdue
by
90 days or more or are being
contested
in good faith by appropriate proceedings promptly instituted and diligently
conducted);
(5) all
Obligations 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 (other than obligations described in clauses
(1),
(2) and (4) above) securing obligations 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 payment on the letter of credit);
(6) guarantees
and other contingent obligations in respect of Indebtedness referred to in
clauses (1) through (5) above and clause (8) below;
(7) all
Obligations of any other Person of the type referred to in clauses (1)
through (6) above which are secured by any Lien on any property or asset
of the
first Person, the amount of such Obligation being deemed to be the lesser
of the
Fair Market Value of such property or asset and the amount of the Obligation
so
secured;
(8) all
Obligations under Currency Agreements and Interest Swap Obligations of such
Person; and
(9) all
Disqualified Capital Stock issued by such Person and all Preferred Stock
issued
by a Subsidiary of such Person with the amount of Indebtedness represented
by
such Disqualified Capital Stock or Preferred Stock being equal to the greater
of
its voluntary or involuntary liquidation preference and its maximum fixed
repurchase price, but excluding accrued dividends, if any.
For
purposes hereof, the “maximum fixed repurchase price” of any Disqualified
Capital Stock or Preferred Stock which does not have a fixed repurchase price
shall be calculated in accordance with the terms of such Disqualified Capital
Stock or Preferred Stock as if such Disqualified Capital Stock or Preferred
Stock were purchased on any date on which Indebtedness shall be required
to be
determined pursuant to this Indenture, and if such price is based upon, or
measured by, the Fair Market Value of such Disqualified Capital Stock or
Preferred Stock.
Except
as
otherwise expressly provided in this definition or in the definition of
“Capitalized Lease Obligation,” the amount of any Indebtedness outstanding as of
any date shall be:
(1) with
respect to contingent obligations, the maximum liability upon the occurrence
of
the contingency giving rise to the obligation;
(2) with
respect to any Hedging Obligation, the net amount payable if such Hedging
Obligation terminated at that time due to default by such Person;
(3) the
accreted value thereof, in the case of any Indebtedness issued at a discount
to
par; or
(4) except
as
provided above, the principal amount or liquidation preference thereof, in
the
case of any other Indebtedness.
“Indenture”
means
this Indenture, as amended or supplemented from time to time.
“Initial
Additional Notes”
means
Additional Notes issued in an offering not registered under the Securities
Act.
“Initial
Notes”
means
the Notes issued on the Measurement Date (and any Notes issued in respect
thereof pursuant to Section 2.06, 2.07, 2.10, 3.06, 3.09, 4.11, 4.16, 4.17
or 9.05).
“Intangible
Valuation Report”
means
a
report by an independent investment banking, appraisal or accounting firm,
in
each case of national standing in the Company’s industry, providing an opinion
as to the Fair Market Value of Residual Interests or Mortgage Servicing Rights,
in each case that are not required to appear on the Company’s consolidated
balance sheet in accordance with GAAP.
“Interest
Swap Obligations”
means
the obligations of any Person pursuant to any arrangement with any other
Person,
whereby, directly or indirectly, such Person is entitled to receive from
time to
time periodic payments calculated by applying either a floating or a fixed
rate
of interest on a stated notional amount in exchange for periodic payments
made
by such other Person calculated by applying a fixed or a floating rate of
interest on the same notional amount and shall include interest rate swaps,
caps, floors, collars and similar agreements, “interest only” mortgage
derivative assets or other mortgage derivative products, futures contracts
and
options on futures contracts on the Eurodollar, Federal Funds, Treasury bills
and Treasury rates and similar financial instruments, but shall exclude forward
loan sales.
“Investment”
means,
with respect to any Person, any direct or indirect loan or other extension
of
credit (including a guarantee) 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
by
such Person of any Capital Stock, bonds, notes, debentures or other securities
or evidences of Indebtedness issued by, any Person. “Investment” shall exclude
extensions of trade credit by the Company and its Restricted Subsidiaries
on
commercially reasonable terms in accordance with normal trade practices of
the
Company or such Restricted Subsidiary, as the case may be.
“Investment
Grade”
means
a
rating of the Notes by both S&P and Xxxxx’x, each such rating being one of
such agency’s four highest generic rating categories that signifies investment
grade (i.e.,
BBB-
(or the equivalent) or higher by S&P and Baa3 (or the equivalent) or higher
by Xxxxx’x); provided,
in each
case, such ratings are publicly available; provided,
further,
that in
the event Xxxxx’x or S&P is no longer in existence for purposes of
determining whether the Notes are rated “Investment Grade,” such organization
may be replaced by a nationally recognized statistical rating organization
(as
defined in Rule 436 under the Securities Act) designated by the Company,
notice
of which shall be given to the Trustee.
“Legal
Holiday”
means
a
Saturday, a Sunday or a day on which commercial banking institutions in New
York
State or The City of New York or at a place of payment are authorized by
law,
regulation or executive order to remain closed. If a payment date is a Legal
Holiday at a place of payment, payment may be made at that place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue
on such
payment for the intervening period.
“Lien”
means
any lien, mortgage, deed of trust, pledge, security interest, charge or
encumbrance of any kind (including any conditional sale or other title retention
agreement or any lease in the nature thereof).
“Measurement
Date”
means
May 4, 2006.
“Moody’s”
means
Xxxxx’x Investors Service, Inc. or any successor to the rating agency business
thereof.
“Mortgage
Servicing Rights”
means,
with respect to any Person, the mortgage servicing rights of such Person
and its
Restricted Subsidiaries that are either (a) capitalized on such Person’s
consolidated balance sheet or (b) not required to appear on such Person’s
consolidated balances sheet, in each case as of the most recent date for
which
internal financial statements are available, determined in accordance with
GAAP.
“MSR
Advances”
means
advances made to the Company or any of its Restricted Subsidiaries under
a
Warehouse Facility to finance the purchase of, and that are secured by, Mortgage
Servicing Rights.
“Net
Cash Proceeds”
means,
with respect to any Asset Sale, the proceeds in the form of cash or Cash
Equivalents including payments in respect of deferred payment obligations
when
received in the form of cash or Cash Equivalents (other than the portion
of any
such deferred payment constituting interest) received by the Company or any
of
its Restricted Subsidiaries from such Asset Sale net of:
(1) out-of-pocket
expenses and fees relating to such Asset Sale (including legal, accounting
and
investment banking fees and sales commissions);
(2) taxes
paid or payable after taking into account any reduction in consolidated tax
liability due to available tax credits or deductions and any tax sharing
arrangements;
(3) repayment
of Indebtedness that is secured by the property or assets that are the subject
of such Asset Sale;
(4) appropriate
amounts to be provided by the Company or any Restricted Subsidiary, as the
case
may be, as a reserve, in accordance with GAAP, against any liabilities
associated with such Asset Sale and retained by the Company or any Restricted
Subsidiary, as the case may be, after such Asset Sale, including pension
and
other post
employment
benefit liabilities, liabilities related to environmental matters and
liabilities under any indemnification obligations associated with such Asset
Sale; and
(5) all
distributions and other payments required to be made to minority interest
holders in Subsidiaries or joint ventures as a result of such Asset
Sale.
“Net
Interest Margin Securitizations”
means
any funding arrangement pursuant to which advances are made to the Company
or
any of its Restricted Subsidiaries in exchange for or secured by net interest
margin securities or other similar direct or indirect interests in
Securitization Vehicles.
“Non-Funding
Credit Facilities”
means,
with respect to the Company or any of its Restricted Subsidiaries, one or
more
debt facilities with banks or other institutional lenders providing for
revolving credit loans, term loans, or letters of credit or other credit
facilities; provided
that in
no event will any such facility that constitutes a Warehouse Facility be
deemed
to qualify as a Non-Funding Credit Facility.
“Non-Funding
Indebtedness”
means
all Indebtedness of the Company and its Restricted Subsidiaries (other than
Funding Indebtedness). The amount of any Non-Funding Indebtedness shall be
determined in accordance with the definition of “Indebtedness.”
“Note”
or
“Notes”
means
the Initial Notes, any Additional Notes and the Exchange Notes.
“Note
Custodian”
means
the Trustee when serving as custodian for the Depositary with respect to
the
Global Notes, or any successor entity thereto.
“Obligations”
means
all obligations for principal, premium, interest, penalties, fees,
indemnification, reimbursements, damages and other liabilities payable under
the
documentation governing any Indebtedness.
“Officer”
means,
with respect to any Person, the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Operating Officer, the Chief Financial
Officer, the Treasurer, any Assistant Treasurer, the Controller, the Secretary
or any Executive Vice President, Senior Vice President or Vice President
of such
Person.
“Officers’
Certificate”
means
a
certificate signed on behalf of the Company by two Officers of the Company,
one
of whom must be the principal executive officer, the chief financial officer
or
the treasurer of the Company, that meets the requirements of
Section 11.05.
“Opinion
of Counsel”
means
an opinion from legal counsel that meets the requirements of Section 11.05.
The counsel may be an employee of or counsel to the Company or any Subsidiary
of
the Company.
“Other
Global Note”
means
a
global note substantially in the form of Exhibit A hereto bearing the
Global Note Legend and the Private Placement Legend and deposited with or
on
behalf of, and registered in the name of, the Depositary or its nominee that
will be issued (or
the
principal amount of which will be increased) in connection with a transfer
pursuant to Section 2.16(e).
“Pari
Passu Indebtedness”
means
any Indebtedness of the Company or any Guarantor that ranks equally in right
of
payment with the Notes or the Guarantee of such Guarantor, as
applicable.
“Participant”
means,
with respect to the Depositary, Euroclear or Clearstream, a Person who has
an
account with the Depositary, Euroclear or Clearstream, respectively (and,
with
respect to DTC, shall include Euroclear and Clearstream).
“Permitted
Indebtedness”
means,
without duplication, each of the following:
(1) Indebtedness
under the Notes issued on the Measurement Date and the related Guarantees
and
Notes issued in exchange for such Notes and the related Guarantees in accordance
with the Registration Rights Agreement;
(2) Non-Funding
Indebtedness of the Company and its Restricted Subsidiaries outstanding on
the
Measurement Date (other than Indebtedness described in clause (1)) reduced
by
the amount of any scheduled amortization payments or mandatory prepayments
when
actually paid or permanent reductions thereon;
(3) Hedging
Obligations of the Company or any of its Restricted Subsidiaries; provided,
however,
that
such Hedging Obligations are entered into for good faith hedging and not
entered
into for speculative purposes;
(4) Indebtedness
of a Restricted Subsidiary of the Company to the Company or to a Restricted
Subsidiary of the Company for so long as such Indebtedness is held by the
Company or a Restricted Subsidiary of the Company; provided
that:
(a) any Indebtedness of a Restricted Subsidiary that is a Guarantor to any
other Restricted Subsidiary of the Company that is not a Guarantor is unsecured
and subordinated, pursuant to a written agreement, to such Guarantor’s
obligations under this Indenture and the Notes; and (b) if as of any date
any Person other than the Company or a Restricted Subsidiary of the Company
owns
or holds, directly or indirectly, any such Indebtedness, such date shall
be
deemed the incurrence by the Company of Indebtedness not constituting Permitted
Indebtedness under this clause (4);
(5) Indebtedness
of the Company to a Restricted Subsidiary of the Company for so long as such
Indebtedness is held by a Restricted Subsidiary of the Company; provided
that:
(a) any Indebtedness of the Company to any Restricted Subsidiary of the
Company that is not a Guarantor is unsecured and subordinated, pursuant to
a
written agreement, to the Company’s obligations under this Indenture and the
Notes; and (b) if as of any date any Person other than a Restricted
Subsidiary of the Company owns or holds, directly or indirectly, any such
Indebtedness, such date shall be deemed the incurrence by the Company of
Indebtedness not constituting Permitted Indebtedness under this clause
(5);
(6) Indebtedness
arising from the honoring by a bank or other financial institution of a check,
draft or similar instrument inadvertently (except in the case of daylight
overdrafts) drawn against insufficient funds in the ordinary course of business;
provided,
however,
that
such Indebtedness is extinguished within two business days of
incurrence;
(7) Indebtedness
of the Company or any of its Restricted Subsidiaries represented by letters
of
credit for the account of the Company or such Restricted Subsidiary, as the
case
may be, in order to provide security for workers’ compensation claims, payment
obligations in connection with self-insurance or similar requirements in
the
ordinary course of business;
(8) Refinancing
Indebtedness;
(9) Funding
Indebtedness;
(10) to
the
extent otherwise constituting Indebtedness, obligations arising from agreements
providing for indemnification, adjustment of purchase price or similar
obligations, in each case, incurred or assumed in connection with the
disposition of Receivables, Residual Interests or other receivables in the
ordinary course of business;
(11) Standard
Securitization Undertakings and Credit Enhancement Agreements relating to
any
Securitization;
(12) Guarantees
by the Company and its Restricted Subsidiaries of Indebtedness that is otherwise
Permitted Indebtedness; and
(13) Indebtedness
of the Company and its Restricted Subsidiaries in an aggregate principal
amount
not to exceed $35.0 million at any one time outstanding.
“Permitted
Investments”
means
an Investment by the Company or any Restricted Subsidiary of the Company
in:
(1) a
Restricted Subsidiary of the Company or a Person that will, upon the making
of
such Investment, become a Restricted Subsidiary of the Company;
(2) 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, a Restricted Subsidiary of the Company;
(3) cash
and
Cash Equivalents;
(4) 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; provided,
however,
that
such trade terms may include such concessionary trade terms as the Company
or
any Restricted Subsidiary deems reasonable under the circumstances;
(5) 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;
(6) loans
or
advances to employees made in the ordinary course of business consistent
with
past practices of the Company or such Restricted Subsidiary not to exceed
$2.0
million at the time of such Investment;
(7) 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 of the Company or in satisfaction of judgments;
(8) any
Person to the extent such Investment represents the non-cash portion of the
consideration received for (A) an Asset Sale as permitted pursuant to Section
4.11 or (B) a disposition of assets not constituting an Asset Sale;
(9) Receivables,
including Servicing Advances;
(10) Residual
or Servicing Interests, net interest margin securities, or otherwise in
Securitization Vehicles in the ordinary course of business (including by
way of
transfers of Receivables to Securitization Vehicles);
(11) any
Person where such Investment was acquired by the Company or any Restricted
Subsidiary (A) in exchange for any other Investment or accounts receivable
held
by the Company or any Restricted Subsidiary in connection with or as a result
of
a bankruptcy, workout, reorganization or recapitalization of the issuer of
such
other Investment or accounts receivable or (B) as a result of a foreclosure
by
the Company or any Restricted Subsidiary with respect to any secured Investment
or other transfer of title with respect to any secured Investment in
default;
(12) any
Person to the extent such Investments consist of prepaid expenses, negotiable
instruments held for collection and lease, utility and workers’ compensation,
performance and other similar deposits made in the ordinary course of business
by the Company or any Restricted Subsidiary;
(13) any
Person to the extent such Investments consist of Interest Swap Obligations
and
Currency Agreements or similar obligations otherwise permitted under this
Indenture;
(14) any
Person, which Investments were existing on the Measurement Date, and any
extension, modification or renewal of any such Investments existing on the
Measurement Date, but only to the extent not involving additional advances,
contributions or other Investments of cash or other assets or other increases
thereof (other than as a result of the accrual or accretion of interest or
original issue discount or the issuance of pay-in-kind securities, in each
case,
pursuant to the terms of such Investment as in effect on the Measurement
Date);
and
(15) Persons
to the extent such Investments, when taken together with all other Investments
made pursuant to this clause (15) outstanding on the date such Investment
is
made, do not exceed $25.0 million; provided
that if
an Investment pursuant to this clause (15) is made in any Person that is
not a
Restricted Subsidiary of the Company at the date of the making of the
Investment, and such Person becomes a Restricted Subsidiary of the Company
after
such date, such Investment shall thereafter be deemed to have been made pursuant
to clause (1) above and shall cease to have been made pursuant to this clause
(15).
“Permitted
Junior Securities”
means:
(1) Capital
Stock in the Company; or
(2) unsecured
debt securities that are subordinated to all Senior Indebtedness (and any
debt
securities issued in exchange for Senior Indebtedness) to substantially the
same
extent as, or to a greater extent than, the applicable Guarantees are
subordinated to Senior Indebtedness under this Indenture.
“Permitted
Liens”
means,
without duplication, each of the following:
(1) Liens
securing Non-Funding Indebtedness (other than Permitted Indebtedness that
is not
referenced in clauses (2), (3) of the definition thereof) incurred pursuant
to
Section 4.10 to the extent that after giving effect to the creation of any
such
Lien and the incurrence of such Non-Funding Indebtedness as of the last day
of
the most recently ended fiscal quarter for which internal financial statements
are available (the “Test
Date”)
and
the incurrence and repayment of any other Indebtedness (but excluding any
Permitted Indebtedness incurred on, but not prior to, the Test Date) incurred
after the Test Date and on or prior to the date of incurrence of such
Non-Funding Indebtedness, the Total Unencumbered Assets of the Company and
its
Consolidated Restricted Subsidiaries are at least 250% of the aggregate amount
of the Unsecured Indebtedness of the Company and its Consolidated Restricted
Subsidiaries outstanding on a consolidated basis;
(2) Liens
for
taxes, assessments or governmental charges or claims either: (a) not
delinquent; or (b) contested in good faith by appropriate proceedings and
as to which the Company or its Restricted Subsidiaries shall have set aside
on
its books such reserves as may be required pursuant to GAAP;
(3) statutory
Liens of landlords and Liens of carriers, warehousemen, mechanics, suppliers,
materialmen, repairmen and other Liens imposed by law incurred in the ordinary
course of business for sums not yet delinquent or being contested in good
faith,
if such reserve or other appropriate provision, if any, as shall be required
by
GAAP shall have been made in respect thereof;
(4) Liens
incurred or deposits made in the ordinary course of business in connection
with
workers’ compensation, unemployment insurance and other types of social
security, including any Lien securing letters of credit issued in the ordinary
course of business, or to secure the performance of tenders, statutory
obligations, surety and appeal
bonds,
bids, leases, government contracts, performance and return-of-money bonds
and
other similar obligations (exclusive of obligations for the payment of borrowed
money);
(5) judgment
Liens not giving rise to an Event of Default so long as such Lien is adequately
bonded and any appropriate legal proceedings which may have been duly initiated
for the review of such judgment shall not have been finally terminated or
the
period within which such proceedings may be initiated shall not have
expired;
(6) easements,
rights-of-way, zoning restrictions and other similar charges or encumbrances
in
respect of real property not interfering in any material respect with the
ordinary conduct of the business of the Company or any of its Restricted
Subsidiaries;
(7) any
interest or title of a lessor under any Capitalized Lease Obligation;
provided
that
such Liens do not extend to any property or assets which is not leased property
subject to such Capitalized Lease Obligation and the proceeds
thereof;
(8) Liens
securing Purchase Money Indebtedness; provided,
however,
that
(a) such Purchase Money Indebtedness shall not exceed the purchase price or
other cost of such property or equipment and shall not be secured by any
property or equipment of the Company or any Restricted Subsidiary of the
Company
other than the equipment so acquired, constructed or improved and proceeds
thereof and (b) the Lien securing such Purchase Money Indebtedness shall be
created within 90 days of such acquisition or completion of installation,
construction or improvement of the relevant property or equipment;
(9) Liens
upon specific items of inventory or other goods and proceeds of any Person
securing such Person’s obligations in respect of bankers’ acceptances issued or
created for the account of such Person to facilitate the purchase, shipment
or
storage of such inventory or other goods;
(10) Liens
securing reimbursement obligations with respect to commercial letters of
credit
which encumber documents and other property relating to such letters of credit
and products and proceeds thereof;
(11) Liens
encumbering deposits made to secure obligations arising from statutory,
regulatory, contractual, or warranty requirements of the Company or any of
its
Restricted Subsidiaries, including rights of offset and set-off;
(12) Liens
securing Acquired Indebtedness incurred in accordance with Section 4.10;
provided
that
(a) such Liens secured such Acquired Indebtedness at the time of and prior
to the incurrence of such Acquired Indebtedness by the Company or a Restricted
Subsidiary of the Company and were not granted in connection with, or in
anticipation of, the incurrence of such Acquired Indebtedness by the Company
or
a Restricted Subsidiary of the Company; and (b) such Liens do not extend to
or cover any property or assets of the Company or of any of its Restricted
Subsidiaries other than the property or assets (including proceeds thereof)
that
secured the Acquired Indebtedness prior to the time such
Indebtedness
became Acquired Indebtedness of the Company or a Restricted Subsidiary of
the
Company;
(13) Liens
on
Receivables, Residual or Servicing Interests, net interest margin securities,
the proceeds thereof and other, related documents, records and assets (including
REO Assets) to secure Funding Indebtedness (including under more than one
facility);
(14) Liens
securing Hedging Obligations; and
(15) Liens
securing Permitted Indebtedness incurred under clause (13) of the definition
thereof.
“Permitted
Securitization Indebtedness”
means
Securitization Indebtedness; provided
that (i)
in connection with any Securitization, any Warehouse Indebtedness used to
finance the purchase, origination or pooling of any Receivables subject to
such
Securitization is repaid in connection with such Securitization to the extent
of
the net proceeds received by the Company and its Restricted Subsidiaries
from
the applicable Securitization Vehicle, and (ii) the excess (determined as
of the
most recent date for which internal financial statements are available),
if any,
of (x) the amount of any such Securitization Indebtedness for which the holder
thereof has contractual recourse to the Company or its Restricted Subsidiaries
to satisfy claims with respect to such Securitization Indebtedness (excluding
Standard Securitization Undertakings) over (y) the aggregate (without
duplication of amounts) Realizable Value of the assets which secure such
Securitization Indebtedness shall not be Permitted Securitization Indebtedness
(but shall not be deemed to be a new incurrence of Non-Funding Indebtedness
except with respect to, and solely to the extent of, any such excess that
exists
upon the initial incurrence of such Securitization Indebtedness).
“Permitted
Warehouse Indebtedness”
means
Warehouse Indebtedness; provided,
however,
that
the excess (determined as of the most recent date for which internal financial
statements are available), 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 (but shall not be deemed to be a
new
incurrence of Non-Funding Indebtedness except with respect to, and solely
to the
extent of, any such excess that exists upon the initial incurrence of such
Warehouse Indebtedness).
“Person”
means
an individual, partnership, limited liability company, corporation,
unincorporated organization, trust or joint venture, or a governmental agency
or
political subdivision thereof.
“Preferred
Stock,”
of
any
Person means any Capital Stock of such Person that has preferential rights
to
any other Capital Stock of such Person with respect to dividends or redemptions
or upon liquidation.
“Private
Placement Legend”
means
the legend set forth in Section 2.06(f)(i) to be placed on all Notes issued
under this Indenture except where otherwise permitted by the provisions of
this
Indenture.
“Purchase
Money Indebtedness”
means
Indebtedness of the Company and its Restricted Subsidiaries incurred in the
normal course of business for the purpose of financing all or any part of
the
purchase price, or the cost of installation, construction or improvement,
of
tangible property or equipment.
“QIB”
means
a
“qualified institutional buyer” as defined in Rule 144A.
“QIB
Global Note”
means
a
global note substantially in the form of Exhibit A hereto bearing the
Global Note Legend and the Private Placement Legend and deposited with or
on
behalf of, and registered in the name of, the Depositary or its nominee that
will be issued in an initial denomination equal to the outstanding principal
amount of the Initial Notes or any Initial Additional Notes, in each case
initially sold to QIBs in reliance on Rule 144A or Section 4(2) of the
Securities Act.
“Qualified
Capital Stock”
means
any Capital Stock that is not Disqualified Capital Stock.
“Realizable
Value”
of
an
asset means (i) with respect to any REO Asset, the value realizable upon
the
disposition of such asset as determined by the Company in its reasonable
discretion and consistent with customary industry practice and (ii) with
respect
to any other asset, the lesser of (x) the face value of such asset and (y)
the
market value of such asset as determined by the Company in accordance with
the
agreement governing the applicable Warehouse Indebtedness, Securitization
Indebtedness or Residual or Servicing Interests Funding Indebtedness (or,
if
such agreement does not contain any related provision, as determined by senior
management of the Company in good faith); provided,
however,
that
the realizable value of any asset described in clause (i) or (ii) above which
an
unaffiliated third party has a binding contractual commitment to purchase
from
the Company or any of its Restricted Subsidiaries shall be the minimum price
payable to the Company or such Restricted Subsidiary for such asset pursuant
to
such contractual commitment.
“Receivables”
means
loans and other mortgage-related receivables (including Servicing Receivables
and Mortgage Servicing Rights but excluding Residual Interests and net interest
margin securities) purchased or originated by the Company or any Restricted
Subsidiary of the Company or, with respect to Servicing Receivables and Mortgage
Servicing Rights, otherwise arising 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.
“Reference
Date”
has
the
meaning ascribed to such term in Section 4.07(iii)(u) of this Indenture.
“Refinance”
means,
in respect of any security or Indebtedness, to refinance, extend, renew,
refund,
repay, prepay, redeem, defease or retire, or to issue a security or
Indebteness
in exchange or replacement for, such security or Indebtedness in whole or
in
part. “Refinanced”
and
“Refinancing”
shall
have correlative meanings.
“Refinancing
Indebtedness”
means
any Refinancing by the Company or any Restricted Subsidiary of the Company
of
Indebtedness (including Permitted Indebtedness) incurred in accordance with
the
Section 4.10 (other than pursuant to clauses (3), (4), (5), (6), (7), (10)
or
(11) of the definition of Permitted Indebtedness), in each case that does
not:
(1) result
in
an increase in the aggregate principal amount of Indebtedness of such Person
as
of the date of such proposed Refinancing (plus the amount of any accrued
interest or premium required to be paid under the terms of the instrument
governing such Indebtedness and plus the amount of reasonable expenses incurred
by the Company or any Restricted Subsidiary in connection with such
Refinancing); or
(2) create
Indebtedness with (a) a Weighted Average Life to Maturity that is less than
the Weighted Average Life to Maturity of the Indebtedness being Refinanced;
or
(b) a final maturity earlier than the final maturity of the Indebtedness
being Refinanced; provided
that
(i) if such Indebtedness being Refinanced is Indebtedness of the Company,
then such Refinancing Indebtedness shall be Indebtedness solely of the Company,
(ii) if such Indebtedness being Refinanced is Indebtedness of the Company
guaranteed by a Subsidiary, then such Refinancing Indebtedness shall be
Indebtedness solely of the Company and such Subsidiary or any Guarantor,
and
(iii) if such Indebtedness being Refinanced is subordinate or junior to the
Notes or any Guarantee, then such Refinancing Indebtedness shall be subordinate
to the Notes or such Guarantee, as the case may be, at least to the same
extent
and in the same manner as the Indebtedness being Refinanced.
“Registered
Exchange Offer”
means
an offer to exchange Initial Notes or Initial Additional Notes, if any, for
Exchange Notes pursuant to a Registration Rights Agreement.
“Registration
Rights Agreement” means
the
registration rights agreement dated as of May 4, 2006 among the Company,
the
Guarantors and X.X. Xxxxxx Securities Inc. and any subsequent Registration
Rights Agreements for Exchange Notes issued hereunder.
“Regulation S”
means
Regulation S promulgated under the Securities Act.
“Regulation S
Global Note”
means
a
global note substantially in the form of Exhibit A hereto bearing the
Global Note Legend and the Private Placement Legend and deposited with or
on
behalf of, and registered in the name of, the Depositary or its nominee that
will be issued in an initial denomination that, when aggregated with any
other
Regulation S Global Notes, will equal the outstanding principal amount of
the Initial Notes or any Initial Additional Notes, in each case, initially
sold
in reliance on Rule 903 of Regulation S.
“REIT”
means
any entity that qualifies as a “real estate investment trust” under Section
856(a) of the Code.
“Related
Business”
means
any business in which the Company or any of the Restricted Subsidiaries was
engaged on the Measurement Date and any business activities that are the
same,
substantially similar, reasonably ancillary or complementary
thereto.
“REO
Asset”
of
a
Person means a real estate asset owned by such Person and acquired as a result
of the foreclosure or other enforcement of a lien on such asset securing
a
Receivable or Servicing Advance.
“Residual
Interests”
means
(i) any residual interests in Securitizations, Securitization Securities,
net
interest margin securities or any other interests in Securitization Vehicles
or
(ii) the residual value of any assets that are financed through Securitization
Indebtedness or Warehouse Indebtedness, regardless of whether required to
appear
on the face of the consolidated financial statements of such Person and its
Consolidated Restricted Subsidiaries in accordance with GAAP.
“Residual
or Servicing Interests”
means
any Mortgage Servicing Rights and any Residual Interests, in each case of
the
Company and its Restricted Subsidiaries.
“Residual
or Servicing Interests Funding Facility”
means
any funding arrangement (including Securitization) with lenders under which
advances are made to the Company or any of its Restricted Subsidiaries based
upon Residual or Servicing Interests.
“Residual
or Servicing Interests Funding Indebtedness”
means
any Indebtedness of the Company or any of its Restricted Subsidiaries under
a
Residual or Servicing Interests Funding Facility or a Net Interest Margin
Securitization; provided
that the
excess (determined as of the most recent date for which internal financial
statements are available), if any of (x) the amount of any such Residual
or
Servicing Interests Funding Indebtedness for which the holder thereof has
contractual recourse (other than any Standard Securitization Undertaking)
to the
Company or its Restricted Subsidiaries to satisfy claims with respect to
such
Residual or Servicing Interests Funding Indebtedness over (y) the aggregate
(without duplication of amounts) Realizable Value of the assets that secure
such
Residual or Servicing Interests Funding Indebtedness shall be deemed not
to be
Residual or Servicing Interests Funding Indebtedness and the portion of such
Indebtedness that ceases to constitute Residual or Servicing Interests Funding
Indebtedness shall be deemed outstanding Non-Funding Indebtedness (but shall
not
be deemed to be a new incurrence except with respect to, and solely to the
extent of, any such excess that exists upon the initial incurrence of such
Indebtedness under a Residual or Servicing Interests Funding Facility or
a Net
Interest Margin Securitization) of the Company or such Restricted Subsidiary,
as
the case may be, at such time.
“Responsible
Officer”
means,
when used with respect to the Trustee, any officer assigned to the Corporate
Trust Office of the Trustee, including any managing director, director, vice
president, assistant vice president, assistant treasurer, or any other officer
of the Trustee customarily performing functions similar to those performed
by
any of the above designated officers and having direct responsibility for
the
administration of this Indenture, and also, with respect to a particular
matter,
any other officer to whom such matter is referred because of such officer’s
knowledge of and familiarity with the particular subject.
“Restricted
Definitive Note”
means
a
Definitive Note bearing the Private Placement Legend.
“Restricted
Global Note”
means
a
Global Note bearing the Private Placement Legend.
“Restricted
Investment”
means
an Investment other than a Permitted Investment.
“Restricted
Period”
means
the relevant 40-day distribution compliance period as defined in
Regulation S.
“Restricted
Subsidiary”
of
a
Person means any Subsidiary of the referent Person that is not an Unrestricted
Subsidiary.
“Reversion
Date”
has
the
meaning ascribed to such term in the definition of “Suspension
Period.”
“Rule
144”
means
Rule 144 promulgated under the Securities Act.
“Rule
144A”
means
Rule 144A promulgated under the Securities Act.
“Rule
903”
means
Rule 903 promulgated under the Securities Act.
“Rule
904”
means
Rule 904 promulgated under the Securities Act.
“S&P”
means
Standard & Poor’s Ratings Service, a division of the XxXxxx-Xxxx Companies,
Inc., or any successor to the rating agency business thereof.
“SEC”
means
the Securities and Exchange Commission.
“Secured
Indebtedness”
means
any Indebtedness secured by a Lien upon the property of the Company or any
of
its Restricted Subsidiaries (regardless of the Realizable Value of such
property).
“Securities
Act”
means
the Securities Act of 1933, as amended, or any successor statute or statutes
thereto.
“Securitization”
means
a
public or private transfer or financing of Receivables, Residual Interests
or
REO Assets in the ordinary course of business by which the Company or any
of its
Restricted Subsidiaries directly or indirectly securitizes a pool of specified
Receivables, Residual Interests or REO Assets.
“Securitization
Indebtedness”
means
(i) Indebtedness of the Company or any of its Restricted Subsidiaries incurred
pursuant to on-balance sheet Securitizations treated as financings and (ii)
any
Indebtedness consisting of advances made to the Company or any of its Restricted
Subsidiaries based upon securities issued by a Securitization Vehicle rating
issued pursuant to a Securitization and acquired or retained by the Company
or
any of its Restricted Subsidiaries.
“Securitization
Securities”
has
the
meaning ascribed to such term in the definition of “Securitization
Vehicle.”
“Securitization
Vehicle”
means
(i) any Person (whether or not a Restricted Subsidiary of the Company)
established for the purpose of issuing asset-backed, mortgage backed or mortgage
pass-through securities of any kind (including collaterized mortgage obligations
and net interest margin securities) or issuing any other Indebtedness (whether
or not in the form of securities) backed by Receivables or Residual Interests
(“Securitization
Securities”)
and
(ii) any special purpose, bankruptcy remote Restricted Subsidiary of the
Company
or any of its Restricted Subsidiaries established in connection with the
issuance of Securitization Securities including Saxon Asset Securities Company
and any other entity (or several entities) that serves as an intermediate
entity
between a Restricted Subsidiary that initially purchases or originates
Receivables or Residual Interests and an entity referred to in clause (i)
regardless of whether such Restricted Subsidiary is an issuer of Securitization
Securities; provided
that
such Person is not an obligor with respect to any Indebtedness of the Company
or
any Restricted Subsidiary of the Company other than under Securitization
Securities, Standard Securitization Undertakings, Credit Enhancement Agreements
and related Hedging Obligations, as the case may be.
“Senior
Indebtedness”
has
the
meaning provided in Section 13.01.
“Senior
Subordinated Indebtedness”
means,
with respect to any Servicing Guarantor, Indebtedness that ranks equal in
right
of payment to the Guarantee of such Servicing Guarantor.
“Servicing
Advances”
means
advances made by the Company or any of its Restricted Subsidiaries in its
capacity as servicer of any mortgage-related receivables to fund principal,
interest, escrow, foreclosure, insurance, tax or other payments or advances
when
the borrower on the underlying receivable is delinquent in making payments
on
such receivable; to enforce remedies, manage and liquidate REO Assets; or
that
the Company or any of its Restricted Subsidiaries otherwise advances in its
capacity as servicer.
“Servicing
Guarantor”
means
each Guarantor that is required by the terms of a Warehouse Facility to
subordinate its Guarantee in right of payment to its obligations under such
Warehouse Facility with respect to (and to the extent of) MSR
Advances.
“Servicing
Receivables”
means
rights to collections under mortgage-related receivables, or other rights
to
reimbursement of Servicing Advances that the Company or a Restricted Subsidiary
of the Company has made in the ordinary course of business and on customary
industry terms.
“Significant
Subsidiary”
with
respect to any Person at any time of determination, means any Restricted
Subsidiary of such Person that satisfies at such time of determination the
criteria for a “Significant Subsidiary” set forth in Rule 1.02(w) of
Regulation S-X under the Exchange Act; provided
that
“Significant Subsidiary” shall not include any Securitization Vehicle that does
not have outstanding any Indebtedness other than Funding Indebtedness and
related Hedging Obligations. On the Measurement Date, Saxon Capital Holdings,
Inc. is a Significant Subsidiary.
“Special
Interest”
means
special or additional interest in respect of Notes that is payable by the
Company as liquidated damages upon specified registration defaults pursuant
to
any Registration Rights Agreement.
“Standard
Securitization Undertakings”
means
representations, warranties, covenants and indemnities entered into by the
Company or a Restricted Subsidiary which are reasonably customary in a rated
receivables securitization transaction, as determined by Company senior
management, including recourse for matters such as fraud, misappropriation
and
misapplication.
“Subordinated
Indebtedness”
means
all of the Company’s and its Restricted Subsidiaries’ Indebtedness that
expressly provides that such Indebtedness shall be subordinated in right
of
payment to the Notes or the relevant Guarantees.
“Subsidiary”
with
respect to any Person at any time of determination, means:
(1) any
corporation of which the outstanding Capital Stock having at least a majority
of
the votes entitled to be cast in the election of directors under ordinary
circumstances is, at such time of determination, owned, directly or indirectly,
by such Person; or
(2) any
other
Person of which at least a majority of the voting interest under ordinary
circumstances is at the time, directly or indirectly, owned by such
Person.
“Suspension
Period” means
the
period (a) beginning on the date that: (1) the Notes are rated Investment
Grade;
provided
that,
prior to the assignment of the Investment Grade ratings, the Company has
advised
the applicable rating agencies that the Suspendable Covenants will not apply
during the Suspension Period; (2) no Default or Event of Default has occurred
and is continuing; and (3) the Company has delivered an Officers’ Certificate to
the Trustee certifying that the conditions set forth in clauses (1) and (2)
above are satisfied; and (b) ending on the date (the “Reversion
Date”)
that
Notes are no longer rated Investment Grade.
“Taxable
REIT Subsidiary”
means
any Restricted Subsidiary which qualifies as a “taxable REIT subsidiary”
pursuant to Section 856(l) of the Code.
“Test
Date”
has
the
meaning ascribed to such term in the definition of “Permitted Liens.”
“TIA”
or
“Trust
Indenture Act”
means
the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) as in effect
on the date on which this Indenture is qualified under the TIA; provided,
however,
that in
the event the Trust Indenture Act of 1939 is amended after such date, then
“TIA”
means, to the extent required by such amendment, the Trust Indenture Act
of 1939
as so amended.
“Total
Unencumbered Assets”
as
of
any date means the sum (without duplication) of
(a) all
assets on the consolidated balance sheet of the Company and its Consolidated
Restricted Subsidiaries (but excluding intangibles (it being understood that
Residual or Servicing Interests are not intangibles for this purpose and
that
capitalized debt issuance costs are intangibles), any deferred tax assets
and
accounts receivable (other than Receivables)) plus
(b) the
value, as stated in an Intangibles Valuation Report dated within 90 days
of such
date of determination of Total Unencumbered Assets, of Residual or Servicing
Interests, in each case of the Company and its Restricted Subsidiaries that
are
not required to appear on the Company’s consolidated balance sheet as of such
date and
in
the
case of (a) or (b), on such date either (x) not securing any portion of
Secured Indebtedness determined on a consolidated basis in accordance with
GAAP
or (y) securing Funding Indebtedness, but in the case of clause (y) solely
to the extent of the excess (determined as of the most recent date for which
internal financial statements are available), if any, of (i) the aggregate
(without duplication of amounts) Realizable Value of the assets which secure
such Funding Indebtedness over (ii) the amount of any such Funding Indebtedness
for which the holder thereof has contractual recourse to the Company or its
Restricted Subsidiaries to satisfy claims with respect to such Funding
Indebtedness (other than Standard Securitization Undertaking).
“Transaction
Date”
has
the
meaning ascribed to such term in the definition of “Consolidated Non-Funding
Indebtedness Interest Coverage Ratio.”
“Transfer
Restricted Notes”
means
Notes that bear or are required to bear the Private Placement
Legend.
“Treasury
Rate”
means,
as of any redemption date, the yield to maturity at the time of computation
of
United States Treasury securities with a constant maturity (as compiled and
published in the most recent Federal Reserve Statistical Release H.15 (519)
which has become publicly available at least two Business Days prior to the
redemption date (or, if such Statistical Release is no longer published,
any
publicly available source or similar market data)) most nearly equal to the
period from the redemption date to May 1, 2014; provided,
however,
that if
the period from the redemption date to May 1, 2014 is not equal to the constant
maturity of a United States Treasury security for which a weekly average
yield
is given, the Treasury Rate shall be obtained by linear interpolation
(calculated to the nearest one-twelfth of a year) from the weekly average
yields
of United States Treasury securities for which such yields are given, except
that if the period from the redemption date to May 1, 2014 is less than one
year, the weekly average yield on actually traded United States Treasury
securities adjusted to a constant maturity of one year shall be
used.
“Trustee”
means
Deutsche Bank Trust Company Americas until a successor replaces Deutsche
Bank
Trust Company Americas in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
“Unrestricted
Global Note”
means
a
permanent global note substantially in the form of Exhibit A hereto that
bears the Global Note Legend and that has the “Schedule of Exchanges of
Interests in the Global Note” attached thereto, and that is deposited with or on
behalf of and registered in the name of the Depositary, representing Notes
that
do not bear the Private Placement Legend.
“Unrestricted
Subsidiary”
of
any
Person means:
(1) any
Subsidiary of such Person that at the time of determination shall be or continue
to be designated an Unrestricted Subsidiary by the Board of Directors of
such
Person in the manner provided below; and
(2) any
Subsidiary of an Unrestricted Subsidiary.
The
Board
of Directors may designate any Restricted Subsidiary (including any newly
acquired or newly formed Restricted Subsidiary) to be an Unrestricted Subsidiary
unless such Restricted Subsidiary owns any Capital Stock of, or owns or holds
any Lien on any property of, the Company or any other Restricted Subsidiary
of
the Company that is not a Restricted Subsidiary of the Restricted Subsidiary
to
be so designated; provided
that:
(1) the
Company certifies to the Trustee that such designation complies with Section
4.07; and
(2) each
Restricted Subsidiary to be so designated and each of its Subsidiaries has
not
at the time of designation, and does not thereafter, create, incur, issue,
assume, guarantee or otherwise become directly or indirectly liable with
respect
to any Indebtedness pursuant to which the lender has recourse to any of the
assets of the Company or any of its Restricted Subsidiaries.
For
purposes of making the determination of whether any such designation of a
Restricted Subsidiary as an Unrestricted Subsidiary complies with Section
4.07
the portion of the Fair Market Value of the net assets of such Restricted
Subsidiary of the Company at the time that such Restricted Subsidiary is
designated as an Unrestricted Subsidiary that is represented by the interest
of
the Company and its Restricted Subsidiaries in such Restricted Subsidiary,
in
each case as determined in good faith by the Board of Directors, shall be
deemed
to be an Investment. Such designation will be permitted only if such Investment
would be permitted at such time under Section 4.07.
The
Board
of Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary only if:
(1) immediately
after giving effect to such designation, the Company is able to incur at
least
$1.00 of additional Indebtedness (other than Permitted Indebtedness) in
compliance with Section 4.10; and
(2) immediately
before and immediately after giving effect to such designation, no Default
or
Event of Default shall have occurred and be continuing. Any such
designation
by the Board of Directors shall be evidenced 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.
As
of the
Measuring Date, no Subsidiaries shall be deemed to be Unrestricted
Subsidiaries.
“Unsecured
Indebtedness”
means
any Indebtedness of the Company or any of its Restricted Subsidiaries that
is
not Secured Indebtedness.
“Warehouse
Facility”
means
any financing arrangement of any kind, including, but not limited to, financing
arrangements in the form of repurchase facilities, loan agreements, note
issuance facilities and commercial paper facilities (and excluding, in all
cases, Securitizations), with a financial institution or other lender or
purchaser exclusively to (i) finance or refinance the purchase or origination
or
finance the pooling of Receivables by the Company or a Restricted Subsidiary
of
the Company, (ii) finance the funding of or refinance Servicing Advances;
(iii)
finance or refinance the carrying of REO Assets related to Receivable or
(iv)
finance or refinance the purchase or origination or finance the pooling of
Residual Interests; provided
that
such purchase, origination, pooling, funding, refinancing and carrying is
in the
ordinary course of business.
“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
calculated in accordance with GAAP.
“Weighted
Average Life to Maturity”
means,
when applied to any Indebtedness at any date, the number of years obtained
by
dividing: (1) the then outstanding aggregate principal amount of such
Indebtedness into (2) the sum of the total of the products obtained by
multiplying (i) the amount of each then remaining installment, sinking
fund, serial maturity or other required payment of principal, including payment
at final maturity, in respect thereof, by (ii) the number of years
(calculated to the nearest one-twelfth) which will elapse between such date
and
the making of such payment.
“Wholly
Owned Restricted Subsidiary”
of
any
Person means any Subsidiary of such Person of which all the outstanding voting
securities (other than in the case of a foreign Subsidiary, directors’
qualifying shares or an immaterial amount of shares required to be owned
by
other Persons pursuant to applicable law) are owned by such Person or any
Wholly
Owned Restricted Subsidiary of such Person.
SECTION
1.02. Other
Definitions
|
Term
|
Definedin
Section
|
|
Affiliate
Transaction
|
4.13
|
|
Agent
Members
|
2.06(a)
|
|
Authentication
Order
|
2.02
|
|
Change
of Control Offer
|
4.16
|
|
Change
of Control Payment
|
4.16
|
|
Change
of Control Payment Date
|
4.16
|
|
Company
|
Preamble
|
|
Covenant
Defeasance
|
8.03
|
|
DTC
|
2.03
|
|
Event
of Default
|
6.01
|
|
Excess
Cash Flow Offer
|
4.17
|
|
Excess
Cash Flow Offer Date
|
4.17
|
|
Excess
Cash Flow Offer Amount
|
4.17
|
|
Excess
Cash Flow Period
|
4.17
|
|
Guarantee
Blockage Notice
|
13.03
|
|
Guarantee
Payment Blockage Period
|
13.03
|
|
Guarantor
Payment Default
|
13.03
|
|
incur
|
4.10
|
|
Net
Proceeds Offer
|
4.11
|
|
Net
Proceeds Offer Amount
|
3.09
|
|
Net
Proceeds Offer Trigger Date
|
4.11
|
|
Non-Guarantor
Payment Default
|
13.03
|
|
Offer
Period
|
3.09
|
|
pay
its Guarantee
|
13.03
|
|
Paying
Agent
|
2.03
|
|
Purchase
Date
|
3.09
|
|
Registrar
|
2.03
|
|
Restricted
Payments
|
4.07
|
|
Suspendable
Covenants
|
4.19
|
|
Trigger
Date
|
4.17
|
SECTION
1.03. Incorporation
by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
“indenture
securities” means the Notes;
“indenture
security holder” means a Holder of a Note;
“indenture
to be qualified” means this Indenture;
“indenture
trustee” or “institutional trustee” means the Trustee; and
“obligor”
on the Notes and the Guarantees means the Company and the Guarantors,
respectively, and any successor obligor upon the Notes and the Guarantees,
respectively.
All
other
terms used in this Indenture that are defined by the TIA, defined by TIA
reference to another statute or defined by SEC rule under the TIA have the
meanings so assigned to them.
SECTION
1.04. Rules
of Construction.
Unless
the context otherwise requires:
(1) a
term
has the meaning assigned to it;
(2) an
accounting term not otherwise defined has the meaning assigned to it, and
all
accounting determinations shall be made, in accordance with GAAP;
(3) “or”
is
not exclusive and “including” means “including without limitation”;
(4) words
in
the singular include the plural, and in the plural include the
singular;
(5) all
exhibits and the terms and provisions contained in the Notes are incorporated
by
reference herein and expressly made a part of this Indenture; however, to
the
extent any provision of any Note conflicts with the express provisions of
this
Indenture, the provisions of this Indenture shall govern and be
controlling;
(6) Indebtedness
that is unsecured shall not be deemed to be subordinate or junior to Secured
Indebtedness merely because it is unsecured, and Senior Indebtedness is not
deemed to be subordinated or junior to any other Senior Indebtedness merely
because it has a junior priority with respect to the same
collateral;
(7) references
to sections of or rules under the Securities Act shall be deemed to include
substitute, replacement or successor sections or rules adopted by the SEC
from
time to time;
(8) references
to any statute, law, rule or regulation shall be deemed to refer to the same
as
from time to time amended and in effect and to any successor statute, law,
rule
or regulation;
(9) any
transaction or event shall be considered “permitted by” or made “in accordance
with” or “in compliance with” this Indenture or any particular provision thereof
if such transaction or event is not expressly prohibited by this Indenture
or
such provision, as the case may be; and
(10) “will”
is
interpreted to express a command.
(11) Acts
of
Holders
(12) Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by Holders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in writing.
Except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments or record or both are delivered
to
the Trustee and, where it is hereby expressly required, to the Company. Proof
of
execution of any such instrument or of a writing appointing any such agent,
or
the holding by any Person of a Note, shall be sufficient for any purpose
of this
Indenture and (subject to Section 7.01) conclusive in favor of the Trustee
and
the Company, if made in the manner provided in this Section 1.05.
(13) The
fact
and date of the execution by any Person of any such instrument or writing
may be
proved by the affidavit of a witness of such execution or by the certificate
of
any notary public or other officer authorized by law to take acknowledgments
of
deeds, certifying that the individual signing such instrument or writing
acknowledged to him the execution thereof. Where such execution is by or
on
behalf of any legal entity other than an individual, such certificate or
affidavit shall also constitute proof of the authority of the Person executing
the same. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in
any
other manner that the Trustee deems sufficient.
(14) Any
request, demand, authorization, direction, notice, consent, waiver or other
action by the Holder of any Note shall bind every future Holder of the same
Note
and the Holder of every Note issued upon the registration of transfer thereof
or
in exchange therefor or in lieu thereof, in respect of any action taken,
suffered or omitted by the Trustee or the Company in reliance thereon, whether
or not notation of such action is made upon such Note.
(15) The
Company may, in the circumstances permitted by the Trust Indenture Act, set
a
record date for purposes of determining the identity of Holders entitled
to give
any request, demand, authorization, direction, notice, consent, waiver or
take
any other act, or to vote or consent to any action by vote or consent authorized
or permitted to be given or taken by Holders. Unless otherwise specified,
if not
set by the Company prior to the first solicitation of a Holder made by any
Person in respect of any such action, or in the case of any such vote, prior
to
such vote, any such record date shall be the later of 30 days prior to the
first
solicitation of such consent or the date of the most recent list of Holders
furnished to the Trustee prior to such solicitation.
(16) Without
limiting the foregoing, a Holder entitled to take any action hereunder with
regard to any particular Note may do so with regard to all or any part of
the
principal amount of such Note or by one or more duly appointed agents, each
of
which may do so pursuant to such appointment with regard to all or any part
of
such principal amount. Any notice given or action taken by a Holder or its
agents with regard to different parts of such principal amount pursuant to
this
paragraph shall have the same effect as if given or taken by separate Holders
of
each such different part.
(17) Without
limiting the generality of the foregoing, a Holder, including DTC that is
the
Holder of a Global Note, may make, give or take, by a proxy or proxies duly
appointed in writing, any request, demand, authorization, direction, notice,
consent, waiver or other action provided in this Indenture to be made, given
or
taken by Holders, and DTC that is the Holder of a Global Note may provide
its
proxy or proxies to the Beneficial Owners of interests in any such Global
Note
through such depositary’s standing instructions and customary
practices.
(18) The
Company may fix a record date for the purpose of determining the Persons
who are
Beneficial Owners of interests in any Global Note held by DTC entitled under
the
procedures of such depositary to make, give or take, by a proxy or proxies
duly
appointed in writing, any request, demand, authorization, direction, notice,
consent, waiver or other action provided in this Indenture to be made, given
or
taken by Holders. If such a record date is fixed, the Holders on such record
date or their duly appointed proxy or proxies, and only such Persons, shall
be
entitled to make, give or take such request, demand, authorization, direction,
notice, consent, waiver or other action, whether or not such Holders remain
Holders after such record date. No such request, demand, authorization,
direction, notice, consent, waiver or other action shall be valid or effective
if made, given or taken more than 90 days after such record date.
ARTICLE
II
THE
NOTES
SECTION
2.01. Form
and Dating.
(a) General.
The
Notes and the Trustee’s certificate of authentication shall be substantially in
the form of Exhibit A hereto. The Notes may have notations, legends or
endorsements required by law, stock exchange rule or usage. Each Note shall
be
dated the date of its authentication. The Notes shall be in minimum
denominations of $2,000 and integral multiples of $1,000.
The
Global Notes shall be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee as custodian for the Depositary, and
registered in the name of the Depositary or a nominee of the Depositary,
duly
executed by the Company and authenticated by the Trustee as hereinafter
provided.
Each
Global Note shall represent such of the outstanding Notes as shall be specified
therein and each shall provide that it shall represent the aggregate amount
of
outstanding Notes from time to time endorsed thereon and that the aggregate
amount of outstanding Notes represented thereby may from time to time be
reduced
or increased, as appropriate, to reflect exchanges, redemptions and transfers
of
interests. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the amount of outstanding Notes represented thereby
shall be made by the Trustee as the Note Custodian, or if the Trustee is
not the
Note Custodian, the Note Custodian at the direction of the Trustee, in
accordance with instructions given by the Holder thereof as required by Section
2.06 hereof.
(b) The
Initial Notes are being issued by the Company only (i) to QIBs and
(ii) in reliance on Regulation S. After such initial offers, Initial
Notes that are Transfer R
(c) stricted
Notes may be transferred (i) to QIBs in reliance on Rule 144A, (ii) to
Accredited Investors in accordance with the Private Placement Legend,
(iii) outside the United States pursuant to Regulation S, (iv) to
the Company, in each case, in accordance with the terms of this Indenture
and
the Notes or (v) pursuant to other transfers that do not require registration
under the Securities Act. Initial Notes that are offered to QIBs in reliance
on
Section 4(2) of the Securities Act shall be issued in the form of one or
more
permanent QIB Global Notes deposited with the Trustee, as Note Custodian,
duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. Initial Notes that are transferred to Accredited Investors in
accordance with the Private Placement Legend shall be in the form of one
or more
permanent IAI Global Notes deposited with the Trustee, as Note Custodian,
duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. Initial Notes that are offered in offshore transactions in reliance
on
Regulation S shall be issued in the form of one or more Regulation S
Global Notes deposited with the Trustee, as Note Custodian, duly executed
by the
Company and authenticated by the Trustee as hereinafter provided. The QIB
Global
Notes, IAI Global Notes and the Regulation S Global Notes shall each be
issued with separate CUSIP numbers. The aggregate principal amount of each
Global Note may from time to time be increased or decreased by adjustments
made
on the records of the Trustee, as Note Custodian. Transfers of Notes between
or
among QIBs and Accredited Investors and to or by purchasers pursuant to
Regulation S shall be represented by appropriate increases and decreases to
the respective amounts of the appropriate Global Notes, as more fully provided
in Sections 2.06 and 2.16.
Section
2.01(b) shall apply only to Global Notes deposited with or on behalf of the
Depositary.
(d) The
Trustee shall have no responsibility or obligation to any Holder that is
a
member of (or a participant in) DTC or any other Person with respect to the
accuracy of the records of DTC (or its nominee) or of any participant or
member
thereof, with respect to any ownership interest in the Notes or with respect
to
the delivery of any notice (including any notice of redemption) or the payment
of any amount or delivery of any Notes (or other security or property) under
or
with respect to the Notes. The Trustee may rely (and shall be fully protected
in
relying) upon information furnished by DTC with respect to its members,
participants and any Beneficial Owners in the Notes.
(e) Definitive
Notes shall be substantially in the form of Exhibit A, attached hereto (but
without including the text referred to in footnotes 2, 3 and 4
thereto).
(f) Euroclear
and Clearstream Procedures Applicable.
The
provisions of the “Operating Procedures of the Euroclear System” and “Terms and
Conditions Governing Use of Euroclear” and the “General Terms and Conditions of
Clearstream Banking” and “Customer Handbook” of Clearstream shall be applicable
to transfers of beneficial interests in Regulation S Global Notes that are
held
by Participants through Euroclear or Clearstream.
SECTION
2.02. Execution
and Authentication.
An
Officer shall sign the Notes for the Company by manual or facsimile
signature.
If
an
Officer whose signature is on a Note no longer holds that office at the time
a
Note is authenticated, the Note shall nevertheless be valid.
A
Note
shall not be valid until authenticated by the manual signature (which may
be by
facsimile) of the Trustee. The signature shall be conclusive evidence that
the
Note has been authenticated under this Indenture. At any time and from time
to
time after the execution and delivery of this Indenture, the Company may
deliver
Notes executed by the Company to the Trustee for authentication; and the
Trustee
shall authenticate and deliver (i) Initial Notes for original issue in the
aggregate principal amount of $150,000,000, (ii) Additional Notes from time
to
time for original issue in aggregate principal amount specified by the Company
and (iii) Exchange Notes from time to time for issue in exchange for a like
principal amount of Initial Notes or Initial Additional Notes, in each case
specified in clauses (i) through (iii) above, upon a written order of the
Company signed by an Officer of the Company (an “Authentication
Order”).
Such
Authentication Order shall specify the amount of the Notes to be authenticated
and the date on which the Notes are to be authenticated, whether such notes
are
to be Initial Notes, Additional Notes or Exchange Notes and whether the Notes
are to be issued as one or more Global Notes and such other information as
the
Company may include or the Trustee may reasonably request. The aggregate
principal amount of Notes which may be authenticated and delivered under
this
Indenture is unlimited.
The
Trustee may appoint an authenticating agent acceptable to the Company to
authenticate Notes. An authenticating agent may authenticate Notes 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 an Agent to deal with Holders or an Affiliate of the
Company.
SECTION
2.03. Registrar
and Paying Agent.
The
Company shall maintain an office or agency where Notes may be presented for
registration of transfer or for exchange (“Registrar”)
and an
office or agency where Notes may be presented for payment (“Paying
Agent”).
The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term “Registrar” includes any co-registrar and the term
“Paying Agent” includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall
notify
the Trustee in writing of the name and address of any Agent not a party to
this
Indenture. Until the Company notifies the Trustee in writing that it has
appointed or maintained another entity as Registrar or Paying Agent, the
Trustee
shall act as such. The Company or any of its Restricted Subsidiaries may
act as
Paying Agent or Registrar.
The
Company initially appoints The Depository Trust Company (“DTC”)
to act
as Depositary with respect to the Global Notes.
The
Company initially appoints the Trustee to act as the Registrar and Paying
Agent
and to act as Note Custodian with respect to the Global Notes.
SECTION
2.04. Paying
Agent to Hold Money in Trust.
The
Company shall require each Paying Agent other than the Trustee to agree in
writing that the Paying Agent shall hold in trust for the Trustee for the
benefit of Holders of Notes or the Trustee all money held by the Paying Agent
for the payment of principal, premium, if any, or interest on the Notes and
shall notify the Trustee of any default by the Company in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the
Trustee.
The Company at any time may require a Paying Agent to pay all money held
by it
to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other
than the Company or a Subsidiary) shall have no further liability for the
money.
If the Company or a Subsidiary acts as Paying Agent, it shall segregate and
hold
in a separate trust fund for the benefit of the Holders of Notes all money
held
by it as Paying Agent. Upon any bankruptcy or reorganization proceedings
relating to the Company, the Trustee shall serve as Paying Agent for the
Notes.
SECTION
2.05. Holder
Lists.
The
Trustee shall preserve in as current a form as is reasonably practicable
the
most recent list available to it of the names and addresses of all Holders
and
shall otherwise comply with TIA Section 312(a). If the Trustee is not the
Registrar, the Company shall furnish to the Trustee at least seven Business
Days
before each interest payment date and at such other times as the Trustee
may
request in writing, a list in such form and as of such date as the Trustee
may
reasonably require of the names and addresses of the Holders of Notes and
the
Company shall otherwise comply with TIA Section 312(a).
SECTION
2.06. Transfer
and Exchange.
(a) Each
Global Note shall (i) be registered in the name of the Depositary for such
Global Notes or the nominee of such Depositary, (ii) be delivered to the
Trustee
as custodian for such Depositary and (iii) bear legends as set forth in Section
2.06(f).
Members
of, or participants in, the Depositary (“Agent
Members”)
shall
have no rights under this Indenture with respect to any Global Note held
on
their behalf by the Depositary, or the Trustee as its custodian, or under
such
Global Note, and the Depositary may be treated by the Company, the Trustee
and
any agent of the Company or the Trustee as the absolute owner of such Global
Note for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein
shall prevent the Company, the Trustee or any agent of the Company or the
Trustee, from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the Depositary
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a Holder of any Note.
(b) Transfers
of a Global Note shall be limited to transfers of such Global Note in whole,
but
not in part, to the Depositary, its successors or their respective nominees.
Interests of Beneficial Owners in a Global Note may be transferred in accordance
with Section 2.16 and the rules and procedures of the Depositary. In addition,
Definitive Notes shall be transferred to all Beneficial Owners in exchange
for
their beneficial interests only if (i) the Depositary notifies the Company
that
the Depositary is unwilling or unable to continue as Depositary for the Global
Notes or the Depositary ceases to be registered as a “clearing agency”
registered under the Exchange Act and a successor depositary is not appointed
by
the Company within ninety (90) days of such notice, (ii) the Company at its
sole
discretion, notifies the Trustee in writing that it elects to cause the issuance
of Definitive Notes under this Indenture or (iii) an Event of Default of
which a
Responsible Officer of the Trustee has actual notice has occurred and is
continuing and the Registrar has received a request from the Depositary to
issue
such Definitive Notes.
(c) In
connection with the transfer of the entire Global Note to Beneficial Owners
pursuant to clause (b) of this Section, such Global Note shall be deemed
to be
surre
(d) dered
to
the Trustee for cancellation, and the Company shall execute, and the Trustee
shall authenticate and deliver, to each Beneficial Owner identified by the
Depositary in exchange for its beneficial interest in such Global Note an
equal
aggregate principal amount of Definitive Notes of authorized
denominations.
(e) The
registered holder of a Global Note may grant proxies and otherwise authorize
any
person, including Agent Members and persons that may hold interests through
Agent Members, to take any action which a Holder is entitled to take under
this
Indenture or the Notes.
(f) A
Definitive Note may not be transferred or exchanged for a beneficial interest
in
a Global Note.
(g) Legends.
The
following legends shall appear on the face of all Global Notes and Definitive
Notes issued under this Indenture unless specifically stated otherwise in
the
applicable provisions of this Indenture.
(i) Private
Placement Legend.
Except
as permitted by Section 2.16, each Global Note and each Definitive Note (and
all
Notes issued in exchange therefor or substitution thereof) shall bear the
legend
in substantially the following form:
THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION. 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, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY,
BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR
ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE
TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION
DATE”) THAT IS IN
THE CASE OF NOTES OFFERED AND SOLD UNDER RULE 144A:
TWO
YEARS AND IN
THE CASE OF NOTES OFFERED AND SOLD UNDER REGULATION S:
40 DAYS
AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH
THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR
ANY
PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) 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 WHOM NOTICE
IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D)
PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN
THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1),
(2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED
INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
SUCH
AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL
AMOUNT
OF THE SECURITIES OF $250,000, 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, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S AND
THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSES (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS
LEGEND
WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE.
(ii) Global
Note Legend.
Each
Global Note shall bear a legend in substantially the following
form:
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OR TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUIRED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER REPRESENTATIVE
OF
THE DEPOSITORY TRUST COMPANY OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS
MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY) ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL
SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS
OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART,
TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S
NOMINEE.
(h) Cancellation
and/or Adjustment of Global Notes.
At such
time as all beneficial interests in a particular Global Note have been exchanged
for Definitive Notes or a particular Global Note has been redeemed, repurchased
or canceled in whole and not in part, each such Global Note shall be returned
to
or retained and canceled by the Trustee in accordance with Section 2.11. At
any time prior to such cancellation, if any beneficial interest in a Global
Note
is exchanged for or transferred to a Person who will take delivery thereof
in
the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall
be
reduced accordingly and an endorsement shall be made on such Global Note
by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by
the
Depositary at the direction of the Trustee to reflect such
increase.
(i) General
Provisions Relating to Transfers and Exchanges.
(i) To
permit
registrations of transfers and exchanges, the Company shall execute and the
Trustee shall authenticate Global Notes and Definitive Notes upon the Company’s
order or at the Registrar’s request.
(ii) No
service charge shall be made to a holder of a beneficial interest in a Global
Note or to a Holder of a Definitive Note for any registration of transfer
or
exchange, but the Company may require payment of a sum sufficient to cover
any
transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer taxes or similar governmental charge payable
upon
exchange or transfer pursuant to Sections 2.02, 2.10, 3.06, 4.11, 4.16,
4.17 and 9.05).
(iii) The
Registrar shall not be required to register the transfer of or exchange any
Note
or portion of a Note selected for redemption or repurchase in whole or in
part,
except the unredeemed or unrepurchased portion of any Note being redeemed
or
repurchased in part.
(iv) All
Global Notes and Definitive Notes issued upon any registration of transfer
or
exchange of Global Notes or Definitive Notes shall be the valid obligations
of
the Company, evidencing the same debt, and entitled to the same benefits
under
this Indenture, as the Global Notes or Definitive Notes surrendered upon
such
registration of transfer or exchange.
(v) The
Company shall not be required to register the transfer of or to exchange
a Note
for a period of 15 days before a selection of Notes to be redeemed or
repurchased or during the period between a record date and the next succeeding
interest payment date.
(vi) Prior
to
due presentment for the registration of a transfer of any Note, the Trustee,
any
Agent and the Company may deem and treat the Person in whose name any Note
is
registered as the absolute owner of such Note for the purpose of receiving
payment of principal of and interest on such Notes and for all other purposes,
and none of the Trustee, any Agent or the Company shall be affected by notice
to
the contrary.
(vii) The
Trustee shall authenticate Global Notes and Definitive Notes in accordance
with
the provisions of Section 2.02.
(viii) All
certifications, certificates and Opinions of Counsel required to be submitted
to
the Registrar pursuant to this Section 2.06 or Section 2.16 to effect a
registration of transfer or exchange may be submitted by facsimile.
SECTION
2.07. Replacement
Notes.
If any
mutilated Note is surrendered to the Trustee or the Company and the Trustee
receives evidence to its satisfaction of the destruction, loss or theft of
any
Note, the Company shall issue and the Trustee, upon receipt of an Authentication
Order, shall authenticate a replacement Note if the Trustee’s requirements are
met. If required by the Trustee or the Company, an indemnity bond must be
supplied by the Holder that is sufficient in the judgment of the Trustee
and the
Company to protect the Company, the Trustee, any Agent and any authenticating
agent from any loss that any of them may suffer if a Note is replaced. The
Company may charge for its expenses in replacing a Note.
Every
replacement Note is an additional legally binding obligation of the Company
and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
SECTION
2.08. Outstanding
Notes.
The
Notes outstanding at any time are all the Notes authenticated by the Trustee
except for those canceled by it, those delivered to it for cancellation,
those
reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions of this Indenture, and those described in
this
Section 2.08 as not outstanding. Except as set forth in Section 2.09, a
Note does not cease to be outstanding because the Company or an Affiliate
of the
Company holds the Note.
If
a Note
is replaced pursuant to Section 2.07, it ceases to be outstanding unless
the Trustee receives proof satisfactory to it that the replaced Note is held
by
a bona fide purchaser.
If
the
principal amount of any Note is considered paid under Section 4.01, it
ceases to be outstanding and interest on it ceases to accrue.
If
the
Paying Agent (other than the Company or a Subsidiary or an Affiliate of any
thereof) holds, on a redemption date or maturity date, money sufficient to
pay
Notes payable on
that
date plus accrued and unpaid interest to such date, then on and after that
date
such Notes shall be deemed to be no longer outstanding and shall cease to
accrue
interest.
SECTION
2.09. Treasury
Notes.
In
determining whether the Holders of the required principal amount of Notes
have
concurred in any direction, waiver or consent, Notes owned by the Company,
or by
any Person directly or indirectly controlling or controlled by or under direct
or indirect common control with the Company, shall be considered as though
not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes that a Responsible Officer of the Trustee knows are so owned shall
be so
disregarded.
SECTION
2.10. Temporary
Notes.
Until
certificates representing Notes are ready for delivery, the Company may prepare
and the Trustee, upon receipt of an Authentication Order, shall authenticate
temporary Notes. Temporary Notes shall be substantially in the form of
certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as shall be reasonably acceptable to
the
Trustee. Without unreasonable delay, the Company shall prepare and the Trustee
shall authenticate, upon receipt of an Authentication Order, definitive Notes
in
exchange for temporary Notes.
Holders
of temporary Notes shall be entitled to all of the benefits of this
Indenture.
SECTION
2.11. Cancellation.
The
Company at any time may deliver Notes and by written notice direct the Trustee
to cancel such Notes. The Registrar and Paying Agent shall forward to the
Trustee any Notes surrendered to them for registration of transfer, exchange
or
payment. The Trustee and no one else shall cancel all Notes surrendered for
registration of transfer, exchange, payment, replacement or cancellation
and
shall dispose of such canceled Notes in its customary manner. The Company
may
not issue new Notes to replace Notes that it has paid or that have been
delivered to the Trustee for cancellation.
SECTION
2.12. Defaulted
Interest.
If the
Company defaults in a payment of interest on the Notes, it shall pay the
defaulted interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted interest, to the Persons who are Holders of Notes
on a
subsequent special record date, in each case at the rate provided in such
Notes
and in Section 4.01. The Company shall notify the Trustee in writing of the
amount of defaulted interest proposed to be paid on each such Note and the
date
of the proposed payment and at the same time the Company shall deposit with
the
Trustee an amount of money equal to the aggregate amount proposed to be paid
in
respect of such defaulted interest or shall make arrangements satisfactory
to
the Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons entitled
to such defaulted interest as provided in this Section 2.12. The Company
shall
fix or cause to be fixed each such special record date and payment date;
provided
that no
such special record date shall be less than 10 days prior to the related
payment
date for such defaulted interest. At least 15 days before the special record
date, the Company (or, upon the written request of the Company, the Trustee
in
the name and at the expense of the Company) shall mail or cause to be mailed
to
Holders of such Notes a notice that states the special record date, the related
payment date and the amount of such interest to be paid.
Subject
to the foregoing provisions of this Section 2.12 and for greater certainty,
each
Note delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Note shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other
Note.
SECTION
2.13. Record
Date.
The
record date for purposes of determining the identity of Holders entitled
to vote
or consent to any action by vote or consent authorized or permitted under
this
Indenture shall be determined as provided for in TIA § 316(c) and Section
1.05.
SECTION
2.14. Computation
of Interest.
Interest on the Notes shall be computed on the basis of a 360-day year comprised
of twelve 30-day months.
SECTION
2.15. CUSIP
Number.
The
Company in issuing the Notes may use “CUSIP” numbers, and if it does so, the
Trustee shall use such CUSIP numbers in notices of redemption or exchange
as a
convenience to Holders; provided
that any
such notice may state that no representation is made as to the correctness
or
accuracy of the CUSIP numbers printed in the notice or on the Notes and that
reliance may be placed only on the other identification numbers printed on
the
Notes. The Company shall promptly notify the Trustee of any change in the
CUSIP
numbers.
SECTION
2.16. Special
Transfer Provisions.
Unless
and until a Transfer Restricted Note is transferred or exchanged under an
effective registration statement under the Securities Act, the following
provisions shall apply:
(a) Transfers
to QIBs.
The
following provisions shall apply with respect to the registration of any
proposed transfer of a Transfer Restricted Note to a QIB:
(i) The
Registrar shall register the transfer of a Transfer Restricted Note by a
Holder
to a QIB if such transfer is being made by a proposed transferor who has
provided the Registrar with (a) an appropriately completed certificate of
transfer in the form attached to the Note and (b) a letter substantially
in the
form set forth in Exhibit B
hereto.
(ii) If
the
proposed transferee is an Agent Member and the Transfer Restricted Note to
be
transferred consists of an interest in either a Regulation S Global Note,
an IAI Global Note or an Other Global Note, upon receipt by the Registrar
of
(x) the items required by paragraph (i) above and (y) instructions given in
accordance with the Depositary’s and the Registrar’s procedures therefor, the
Registrar shall reflect on its books and records the date and an increase
in the
principal amount of the QIB Global Note in an amount equal to the principal
amount of the beneficial interest in the Regulation S Global Note, IAI
Global Note or Other Global Note, as applicable, to be so transferred, and
the
Registrar shall reflect on its books and records the date and an appropriate
decrease in the principal amount of such Regulation S Global Note, IAI
Global Note or Other Global Note, as applicable.
(iii) Transfers
Pursuant to Regulation S.
The
following provisions shall apply with respect to the registration of any
proposed transfer of a Transfer Restricted Note pursuant to Regulation S:
(iv) The
Registrar shall register any proposed transfer of a Transfer Restricted Note
pursuant to Regulation S by a Holder upon receipt of (a) an appropriately
completed certificate of transfer in the form attached to the Note and (b)
a
letter substantially in the form set forth in Exhibit C
hereto
from the proposed transferor.
(v) If
the
proposed transferee is an Agent Member and the Transfer Restricted Note to
be
transferred consists of an interest in a QIB Global Note, an IAI Global Note
or
an Other Global Note, upon receipt by the Registrar of (x) the items
required by paragraph (i) above and (y) instructions given in
accordance with the Depositary’s and the Registrar’s procedures therefor, the
Registrar shall reflect on its books and records the date and an increase
in the
principal amount of the Regulation S Global Note in an amount equal to the
principal amount of the beneficial interest in the QIB Global Note, IAI Global
Note or Other Global Note, as applicable, to be transferred, and the Registrar
shall reflect on its books and records the date and an appropriate decrease
in
the principal amount of the QIB Global Note, IAI Global Note or Other Global
Note, as applicable.
(b) Transfers
to Non-QIB Accredited Investors.
The
following provisions shall apply with respect to the registration of any
proposed transfer of a Transfer Restricted Note to any Accredited Investor
which
is not a QIB:
(i) The
Registrar shall register any proposed transfer of a Transfer Restricted Note
to
an Accredited Investor which is not a QIB if (a) the requested transfer is
after
the second anniversary of the Measurement Date; provided,
however,
that
neither the Company nor any Affiliate of the Company has held any beneficial
interest in such Note, or portion thereof, at any time on or prior to the
second
anniversary of the Measurement Date or (b) the proposed transferee has
delivered to the Registrar a certificate substantially in the form set forth
in
Exhibit
D
hereto,
together with the legal opinion, if any, required thereby.
(ii) If
the
proposed transferee is an Agent Member and the Transfer Restricted Note to
be
transferred consists of an interest in a QIB Global Note, a Regulation S
Global Note or an Other Global Note, upon receipt by the Registrar of
(x) the items required by paragraph (i) above and
(y) instructions given in accordance with the Depositary’s and the
Registrar’s procedures therefor, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the IAI Global
Note
in an amount equal to the principal amount of the beneficial interest in
the QIB
Global Note, Regulation S Global Note or Other Global Note, as applicable,
to be transferred, and the Registrar shall reflect on its books and records
the
date and an appropriate decrease in the principal amount of the QIB Global
Note,
Regulation S Global Note or Other Global Note, as applicable.
(iii) Exchange
Offer.
Upon
the occurrence of the applicable Registered Exchange Offer in accordance
with
the applicable Registration Rights Agreement, the Company shall issue and,
upon
receipt of an Authentication Order in accordance with Section 2.02, the Trustee
shall authenticate one or more Global Notes not bearing the Private Placement
Legend in an aggregate principal amount equal to the principal amount of
the
beneficial interests in the Global Notes that are Transfer Restricted Notes
tendered for acceptance in accordance with the Registered Exchange Offer
and
accepted for exchange in the Registered Exchange Offer.
Concurrently
with the issuance of such Global Notes, the Registrar shall cause the aggregate
principal amount of the applicable Transfer Restricted Notes to be reduced
accordingly, and the Registrar shall deliver to the Persons designated by
the
Holders of Transfer Restricted Notes Global Notes not bearing the Private
Placement Legend in the appropriate principal amount.
(c) Other
Transfers.
The
following provisions shall apply with respect to the registration by the
Registrar of any other proposed transfer of a Transfer Restricted Note that
does
not require registration under the Securities Act:
(i) The
Registrar shall register such transfer if it is being made by a proposed
transferor who has provided the Registrar with (a) an appropriately completed
certificate of transfer in the form attached to the Note and (b) a legal
opinion
from a law firm of nationally recognized standing to the effect that such
transfer does not require registration under the Securities Act.
(ii) Subject
to clause (iii) below, if the proposed transferee is an Agent Member and
the
Transfer Restricted Note to be transferred consists of an interest in either
a
QIB Global Note, a Regulation S Global Note or an IAI Global Note, upon
receipt by the Registrar of (x) the items required by paragraph (i) above
and (y) instructions given in accordance with the Depositary’s and the
Registrar’s procedures therefor, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the Other Global
Note in an amount equal to the principal amount of the beneficial interest
in
the QIB Global Note, the Regulation S Global Note or the IAI Global Note,
as applicable, to be so transferred, and the Registrar shall reflect on its
books and records the date and an appropriate decrease in the principal amount
of such QIB Global Note, Regulation S Global Note or IAI Global Note, as
applicable.
(iii) In
connection with the first transfer pursuant to this Section 2.16(e), an Other
Global Note shall be issued in the form of a permanent Global Note substantially
in the form set forth in Exhibit A hereto, deposited with the Trustee, as
Note Custodian, duly executed by the Company and authenticated by the Trustee
as
herein provided. Each Other Global Note shall be issued with its own CUSIP
number. The aggregate principal amount of the Other Global Note may from
time to
time be increased or decreased by adjustments made on the records of the
Trustee, as Note Custodian.
(iv) Private
Placement Legend.
Upon
the transfer, exchange or replacement of Notes not bearing the Private Placement
Legend, the Registrar shall deliver Notes that do not bear the Private Placement
Legend. Upon the transfer, exchange or replacement of Transfer Restricted
Notes,
the Registrar shall deliver only Transfer Restricted Notes unless either
(i) such transfer or exchange is made in connection with a Registered
Exchange Offer, (ii), or (ii) there is delivered to the Registrar an
Opinion of Counsel reasonably satisfactory to the Company and the Trustee
to the
effect that neither such legend nor the related restrictions on transfer
are
required in order to maintain compliance with the provisions of the Securities
Act.
(d) General.
By its
acceptance of any Transfer Restricted Note, each Holder of such a Note
acknowledges the restrictions on transfer of such Note set forth in this
Indenture and in the Private Placement Legend and agrees that it shall transfer
such Note only as provided in this Indenture.
The
Registrar shall retain copies of all letters, notices and other written
communications received pursuant to this Section 2.16.
SECTION
2.17. Issuance
of Additional Notes.
Subject
to the Company’s compliance with Section 4.10 hereof, the Company shall be
entitled to issue Additional Notes under this Indenture that shall have
identical terms as the Initial Notes, other than with respect to the date
of
issuance, issue price and amount of interest payable on the first interest
payment date applicable thereto (and other than with respect to transfer
restrictions, any Registration Rights Agreement and additional interest with
respect thereto). The Initial Notes, any Additional Notes and all Exchange
Notes
shall be treated as a single class for all purposes under this
Indenture.
With
respect to any Additional Notes, the Company shall set forth in a resolution
of
its Board of Directors and in an Officers’ Certificate, a copy of each of which
shall be delivered to the Trustee, the following information:
(i) the
aggregate principal amount of such Additional Notes to be authenticated and
delivered pursuant to this Indenture;
(ii) the
issue
price and the date on which such Additional Notes shall be issued, the CUSIP
number, the first interest payment date and the amount of interest payable
on
such first interest payment date applicable thereto and the date from which
interest shall accrue; and
(iii) whether
such Additional Notes shall be Transfer Restricted Notes and whether they
will
be QIB Global Notes or Regulation S Global Notes.
(iv)
REDEMPTION
SECTION
2.18. Notices
to Trustee.
If the
Company elects to redeem Notes pursuant to the optional redemption provisions
of
Section 3.07, it shall furnish to the Trustee, at least 30 days but not
more than 60 days before a redemption date, an Officers’ Certificate setting
forth (i) the clause of this Indenture pursuant to which the redemption
shall occur, (ii) the redemption date, (iii) the principal amount of
Notes to be redeemed and (iv) the redemption price.
SECTION
2.19. Selection
of Notes to Be Redeemed.
If less
than all of the Notes are redeemed or purchased in an offer to purchase at
any
time, the Trustee shall select the Notes to be redeemed or purchased among
the
Holders of the Notes in compliance with the requirements of the principal
national securities exchange, if any, on which the Notes are listed or, if
the
Notes are not so listed, on a pro rata basis, by lot or in accordance with
any
other method the Trustee shall deem fair and appropriate. In the event of
partial redemption by lot, the particular Notes to be redeemed shall be
selected, unless otherwise provided herein, not less than 30 nor more than
60
days prior to the redemption date by the Trustee from the outstanding Notes
not
previously called for redemption.
The
Trustee shall promptly notify the Company in writing of the Notes selected
for
redemption and, in the case of any Note selected for partial redemption,
the
principal amount thereof to be redeemed. Notes and portions of Notes selected
shall be in minimum amounts of $2,000 or whole multiples of $1,000; no Notes
of
$2,000 or less can be redeemed in part, except that if all of the Notes of
a
Holder are to be redeemed, the entire outstanding amount of Notes held by
such
Holder, even if not a multiple of $1,000, shall be redeemed. Except as provided
in the preceding sentence, provisions of this Indenture that apply to Notes
called for redemption also apply to portions of Notes called for redemption.
If
a partial redemption is made with the proceeds of an Equity Offering, the
Trustee will select the Notes only on a pro
rata
basis or
on as nearly a pro
rata
basis as
is practicable (subject to DTC procedures).
SECTION
2.20. Notice
of Redemption.
Subject
to the provisions of Section 3.09, at least 30 days but not more than 60
days before a redemption date, the Company shall mail or cause to be mailed,
by
first class mail, a notice of redemption to each Holder whose Notes are to
be
redeemed at its registered address.
The
notice shall identify the Notes to be redeemed and shall state:
(a) the
redemption date;
(b) the
redemption price;
(c) if
any
Note is being redeemed in part, the portion of the principal amount of such
Note
to be redeemed and that, after the redemption date upon surrender of such
Note,
a new Note or Notes in principal amount equal to the unredeemed portion shall
be
issued upon cancellation of the original Note;
(d) the
name
and address of the Paying Agent;
(e) that
Notes called for redemption must be surrendered to the Paying Agent to collect
the redemption price;
(f) that,
unless the Company defaults in making such redemption payment, interest on
Notes
called for redemption ceases to accrue on and after the redemption
date;
(g) the
paragraph of the Notes and/or Section of this Indenture pursuant to which
the
Notes called for redemption are being redeemed; and
(h) that
no
representation is made as to the correctness or accuracy of the CUSIP number,
if
any, listed in such notice or printed on the Notes.
At
the
Company’s request, the Trustee shall give the notice of redemption in the
Company’s name and at its expense; provided,
however,
that
the Company shall have delivered to the Trustee, at least 45 days prior to
the
redemption date, an Officers’ Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.
SECTION
2.21. Effect
of Notice of Redemption.
Once
notice of redemption is mailed in accordance with Section 3.03, Notes
called for redemption become irrevocably due and payable on the redemption
date
at the redemption price. A notice of redemption may not be
conditional.
SECTION
2.22. Deposit
of Redemption Price.
At or
prior to 10:00 a.m., New York City time, on the redemption date, the Company
shall deposit with the Trustee or with the Paying Agent money sufficient
to pay
the redemption price of and accrued interest on all Notes to be redeemed
on that
date. The Trustee or the Paying Agent shall promptly return to the Company
any
money deposited with the Trustee or the Paying Agent by the Company in excess
of
the amounts necessary to pay the redemption price of, and accrued interest
on,
all Notes to be redeemed.
If
the
Company complies with the provisions of the preceding paragraph, on and after
the redemption date, interest shall cease to accrue on the Notes or the portions
of Notes called for redemption. Notwithstanding anything herein to the contrary,
if a Note is redeemed on or after an interest record date but on or prior
to the
related interest payment date, then any accrued and unpaid interest shall
be
paid to the Person in whose name such Note was registered on the redemption
date. If any Note called for redemption shall not be so paid upon surrender
for
redemption because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal, from the redemption
date until such principal is paid, and to the extent lawful on any interest
not
paid on such unpaid principal, in each case at the rate provided in the Notes
and in Section 4.01.
SECTION
2.23. Notes
Redeemed in Part.
Upon
surrender of a Note that is redeemed in part, the Company shall issue and,
upon
the Company’s written request, the Trustee shall authenticate for the Holder at
the expense of the Company a new Note equal in principal amount
to
the unredeemed portion of the Note surrendered;
provided
that
each new Note will be in a minimum principal amount of $2,000 and an integral
multiple of $1,000.
SECTION
2.24. Optional
Redemption.
(1) At
any
time, or from time to time, on or prior to May 1, 2009, the Company may, at
its option, use the net cash proceeds of one or more Equity Offerings to
redeem
up to 35% of the aggregate principal amount of the Initial Notes and Additional
Notes initially issued under this Indenture at a redemption price of 112.000%
of
the principal amount thereof plus accrued and unpaid interest thereon, if
any,
to the date of redemption; provided
that the
Company makes such redemption not more than 90 days after the consummation
of
any such Equity Offering.
(2) In
addition, the Notes may be redeemed, in whole or in part, at any time prior
to
the maturity date at the option of the Company at a redemption price equal
to
100% of the principal amount of the Notes redeemed plus the Applicable Premium
as of, and accrued and unpaid interest to, the applicable redemption
date.
(3) Any
redemption pursuant to this Section 3.07 shall be made pursuant to the
provisions of Sections 3.01 through 3.06.
SECTION
2.25. Mandatory
Redemption or Repurchase.
Except
as otherwise provided in Section 4.11, Section 4.16 or Section 4.17
below, the Company shall not be required to make mandatory redemption or
sinking
fund payments with respect to the Notes or be required to repurchase any
Notes.
SECTION
2.26. Offer
to Purchase by Application of Net Proceeds.
In the
event that the Company shall be required to commence an offer to all Holders
to
purchase Notes pursuant to Section 4.11 (a “Net
Proceeds Offer”),
it
shall follow the procedures specified below.
The
Net
Proceeds Offer shall remain open for a period of 20 Business Days following
its
commencement and no longer, except to the extent that a longer period is
required by applicable law (the “Offer
Period”).
No
later than five Business Days after the termination of the Offer Period (any
such date of purchase, the “Purchase
Date”)
(which
shall not be less than 30 nor more than 45 days following the applicable
Net
Proceeds Offer Trigger Date), the Company shall purchase the principal amount
of
Notes required to be purchased pursuant to Section 4.11 (the “Net
Proceeds Offer Amount”)
or, if
less than the Net Proceeds Offer Amount has been tendered, all Notes tendered
in
response to the Net Proceeds Offer. Payment for any Notes so purchased shall
be
made in the same manner as interest payments are made. Unless the Company
defaults in making such payment, any Note accepted for payment pursuant to
the
Net Proceeds Offer shall cease to accrue interest after the Purchase Date.
If
any Net Cash Proceeds remain after the consummation of any Net Proceeds Offer,
the Company may use those Net Cash Proceeds for any purpose not otherwise
prohibited by this Indenture. Upon completion of each Net Proceeds Offer,
the
amount of Net Cash Proceeds will be reset at zero.
The
Company shall comply with the requirements of Rule 14e-1 under the Exchange
Act (or any successor rules) and any other securities laws and regulations
thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of the Notes pursuant to a Net Proceeds Offer. To the extent that
the
provisions of any securities laws or regulations conflict with the provisions
of
this Section 3.09, the Company shall comply with such laws and regulations
shall not be deemed to have breached its obligations under this
Section 3.09.
Notwithstanding
anything to the contrary in this Indenture, if the Purchase Date is on or
after
an interest record date and on or before the related interest payment date,
any
accrued and unpaid interest shall be paid to the Person in whose name a Note
is
registered on the Purchase Date.
Within
25
days following the Net Proceeds Offer Trigger Date, the Company shall send,
by
first class mail, a notice to each of the Holders, with a copy to the Trustee.
The notice shall contain all instructions and materials necessary to enable
such
Holders to tender Notes pursuant to the Net Proceeds Offer. The Net Proceeds
Offer shall be made to all Holders. The notice, which shall govern the terms
of
the Net Proceeds Offer, shall state:
(a) that
the
Net Proceeds Offer is being made pursuant to this Section 3.09 and
Section 4.11 and the length of time the Net Proceeds Offer shall remain
open;
(b) the
Net
Proceeds Offer Amount, the purchase price and the Purchase Date;
(c) that
any
Note not tendered or accepted for payment shall continue to accrue
interest;
(d) that,
unless the Company defaults in making such payment, any Note accepted for
payment pursuant to the Net Proceeds Offer shall cease to accrue interest
after
the Purchase Date;
(e) that
Holders electing to have a Note purchased pursuant to a Net Proceeds Offer
may
elect to have Notes purchased in minimum denominations of $2,000 and integral
multiples of $1,000 only;
(f) that
Holders electing to have a Note purchased pursuant to any Net Proceeds Offer
shall be required to surrender the Note, with the form entitled “Option of
Holder to Elect Purchase” on the reverse of the Note completed, or transfer by
book-entry transfer, to the Company, a depositary, if appointed by the Company,
or a Paying Agent at the address specified in the notice at least three Business
Days before the Purchase Date;
(g) that
Holders shall be entitled to withdraw their election if the Company, the
depositary or the Paying Agent, as the case may be, receives, not later than
the
expiration of the Offer Period, a telegram, telex, facsimile transmission
or
letter setting forth the name of the Holder, the principal amount of the
Note
the Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have such Note purchased;
(h) that,
if
the aggregate principal amount of Notes surrendered by Holders exceeds the
Offer
Amount, the Company shall select the Notes to be purchased on a pro rata
basis
(with such adjustments as may be deemed appropriate by the Company so that
only
Notes in minimum denominations of $2,000 and integral multiples of $1,000,
shall
be purchased); and
(i) that
Holders whose Notes were purchased only in part shall be issued new Notes
equal
in principal amount to the unpurchased portion of the Notes surrendered (or
transferred by book-entry transfer).
On
or
before the Purchase Date, the Company shall, to the extent lawful, accept
for
payment, on a pro rata basis to the extent necessary, the Net Proceeds Offer
Amount of Notes or portions thereof tendered pursuant to the Net Proceeds
Offer
or if less than the Net Proceeds Offer Amount has been tendered, all Notes
tendered, and shall deliver to the Trustee an Officers’ Certificate stating that
such Notes or portions thereof were accepted for payment by the Company in
accordance with the terms of this Section 3.09. The Company, the Depositary
or the Paying Agent, as the case may be, shall promptly (but in any case
not
later than five days after the Purchase Date) mail or deliver to each tendering
Holder an amount equal to the purchase price of the Notes tendered by such
Holder and accepted by the Company for purchase, and the Company shall promptly
issue a new Note, and the Trustee, upon written request from the Company,
shall
authenticate and mail or deliver such new Note to such Holder, in a principal
amount equal to any unpurchased portion of the Note surrendered; provided
that
each such new Note shall be in a minimum principal amount of $2,000 and integral
multiples of $1,000. Any Note not so accepted shall be promptly mailed or
delivered by the Company to the Holder thereof. The Company shall publicly
announce the results of the Net Proceeds Offer on the Purchase
Date.
ARTICLE
III
COVENANTS
SECTION
3.01. Payment
of Notes.
The
Company shall pay or cause to be paid the principal, premium, if any, and
interest on the Notes on the dates and in the manner provided in the Notes.
Principal, premium, if any, and interest shall be considered paid on the
date
due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 10:00 a.m. New York City time on the due date money deposited
by the
Company in immediately available funds and designated for and sufficient
to pay
all principal, premium, if any, and interest then due. The Company shall
pay all
Special Interest, if any, in the same manner on the dates and in the amounts
set
forth in any Registration Rights Agreement.
The
Company shall pay interest (including post-petition interest in any proceeding
under any Bankruptcy Law) on overdue principal at the then applicable interest
rate on the Notes; it shall pay interest (including post-petition interest
in
any proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
Maintenance
of Office or Agency.
The
Company shall maintain an office or agency (which may be an office of the
Trustee or an affiliate of the Trustee, Registrar or co-registrar) where
Notes
may be surrendered for registration of transfer or for exchange and where
notices and demands to or upon the Company in respect of the Notes and this
Indenture may be served. The Company shall give prompt written notice to
the
Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served
at the
Corporate Trust Office of the Trustee.
The
Company may also from time to time designate one or more other offices or
agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations. The Company
shall
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or
agency.
The
Company hereby designates Deutsche Bank Trust Company Americas, at 00 Xxxx
Xxxxxx - 27th
floor,
New York, New York 10005, Attn: Trust and Securities Services, as one such
office or agency of the Company in accordance with
Section 2.03.
SECTION
3.02. Reports.
(a) Whether
or not required by the rules and regulations of the SEC, so long as any Notes
are outstanding, the Company will furnish the record Holders of
Notes:
(1) all
quarterly and annual financial information that would be required to be
contained in a filing with the SEC on Forms 10-Q and 10-K if the Company
were
required to file such Forms, including a “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” that describes the financial
condition and results of operations of the Company and its consolidated
Subsidiaries and, with respect to the annual information only, a report thereon
by the Company’s certified independent accountants; and
(2) all
current reports that would be required to be filed with the SEC on Form 8-K
if
the Company were required to file such reports,
in
each
case within the time periods specified in the SEC’s rules and
regulations.
(b) If
the
Company has designated any of its Subsidiaries as an Unrestricted Subsidiary,
then the quarterly and annual financial information required by the preceding
paragraph shall include a reasonably detailed presentation, either on the
face
of the financial statements or in the footnotes to the financial statements
and
in Management’s Discussion and Analysis of Financial Condition and Results of
Operations, of the financial condition and results of operations of the Company
and its Restricted Subsidiaries.
(c) In
addition, whether or not required by the rules and regulations of the SEC,
the
Company will file a copy of all such information and reports with the SEC
for
public
(d) availability
within the time periods specified in the SEC’s rules and regulations (unless the
SEC will not accept such a filing) and make such information available to
prospective investors upon request. In addition, the Company has agreed that,
for so long as any Notes remain outstanding, it will furnish to the Holders
and
to prospective investors, upon their request, the information required to
be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
(e) Notwithstanding
anything to the contrary, the Company will be deemed to have complied with
its
obligations in the preceding three paragraphs if it has timely filed
electronically with the SEC’s Electronic Data Gathering, Analysis and Retrieval
System (or any successor system) the reports and information described
above.
SECTION
3.03. Compliance
Certificate.
(1) The
Company and each Guarantor (to the extent that such Guarantor is required
under
the TIA) shall deliver to the Trustee, within 120 days after the end of each
fiscal year of the Company, an Officers’ Certificate stating that in the course
of the performance by the signers of their duties as Officers of the Company
they would normally have knowledge of any Default and whether or not the
signers
know of any Default that occurred during such period. If they do have such
knowledge, the certificate shall describe the Default, its status and what
action the Company is taking or proposes to take with respect thereto. The
Company also shall comply with Section 314(a)(4) of the TIA.
(2) The
Company shall deliver to the Trustee, as soon as possible and in any event
within five days after any Officer becomes aware of any Default or Event
of
Default, an Officers’ Certificate specifying such Default or Event of Default
and what action the Company is taking or propose to take with respect
thereto.
SECTION
3.04. Taxes.
The
Company shall pay, and shall cause each of its Restricted Subsidiaries to
pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings
or
where the failure to effect such payment is not likely to result in a material
adverse effect on the Company and its Restricted Subsidiaries taken as a
whole.
SECTION
3.05. Stay,
Extension and Usury Laws.
The
Company and each of the Guarantors covenant (to the extent that they may
lawfully do so) that they shall not at any time insist upon, plead, or in
any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law wherever enacted, now or at any time hereafter in force, that
may
affect the covenants or the performance of this Indenture; and the Company
and
each of the Guarantors (to the extent that they may lawfully do so) hereby
expressly waive all benefit or advantage of any such law, and covenant that
they
shall not, by resort to any such law, hinder, delay or impede the execution
of
any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law has been
enacted.
SECTION
3.06. Restricted
Payments.
The
Company shall not, and shall not cause or permit any of its Restricted
Subsidiaries to, directly or indirectly:
declare
or pay any dividend or make any distribution (other than dividends or
distributions payable solely in Qualified Capital Stock of the Company) on
or in
respect of shares of the Company’s Capital Stock to holders of such Capital
Stock (including any payment or distribution in connection with any merger
or
acquisition);
(1) purchase,
redeem or otherwise acquire or retire for value any Capital Stock of the
Company
or any warrants, rights or options to purchase or acquire shares of any class
of
such Capital Stock (other than in exchange for Qualified Capital Stock of
the
Company);
(2) make
any
principal payment on, purchase, defease, redeem, prepay, decrease or otherwise
acquire or retire for value, prior to any scheduled final maturity, scheduled
repayment or scheduled sinking fund payment, any Subordinated Indebtedness
(other than Indebtedness owed by the Company or any Restricted Subsidiary
to
another Restricted Subsidiary or the Company) of the Company or any of its
Restricted Subsidiaries (other than principal payments on, purchases,
defeasance, redemption, prepayment, decreases or other acquisition or retirement
for value of such Subordinated Indebtedness due within one year of the date
of
such principal payment, purchase, defeasance, redemption, prepayment, decrease
or other acquisition or retirement for value); or
(3) make
any
Restricted Investment;
if
at the
time of such action (each, a “Restricted
Payment”)
or
immediately after giving effect thereto:
(i) a
Default
or an Event of Default shall have occurred and be continuing or would result
therefrom;
(ii) the
Company is not able to incur at least $1.00 of additional Non-Funding
Indebtedness (other than Permitted Indebtedness) in compliance with Section
4.10; or
(iii) the
aggregate amount of Restricted Payments (including such proposed Restricted
Payment) made subsequent to the Measurement Date (the amount expended for
such
purposes, if other than in cash, being the Fair Market Value of the property
comprising such Restricted Payment) shall exceed the sum of:
(u) the
sum
of (A) 95% of the cumulative Consolidated Net Income of the Company (or,
while
the Company is not a REIT, 50% of the cumulative Consolidated Net Income
of the
Company) (or if cumulative Consolidated Net Income shall be a loss, minus
100%
of such loss) earned during the period from April 1, 2006 through the last
day of the Company’s most recent fiscal quarter which ends prior to the date
(the “Reference
Date”)
on
which the Restricted Payment occurs (treating such period as a single accounting
period) plus
(B)
while the Company is a REIT, amortization expense associated with Mortgage
Servicing Rights of the Company for such period which amount under this clause
(B) shall not exceed, together with the amount in clause (A), the amount
that
the senior management of the Company determines in good faith to be necessary
to
be paid as a dividend or distribution for the Company to maintain its status
as
a REIT under the Code; plus
(v) 100%
of
the aggregate net cash proceeds and 100% of the aggregate Fair Market Value
of
property other than cash, in each case received by the Company from any Person
(other than a Subsidiary of the Company) from the issuance and sale subsequent
to the Measurement Date and on or prior to the Reference Date of Qualified
Capital Stock of the Company (other than net cash proceeds received from
the
issuance or sale of such Qualified Capital Stock to (a) a Subsidiary of the
Company or (b) an employee stock ownership plan, option plan or similar trust
(to the extent such sale to an employee stock ownership plan, option plan
or
similar trust is financed by loans from or is guaranteed by the Company or
any
Restricted Subsidiary unless such loans have been repaid with cash on or
prior
to the Reference Date); plus
(w) without
duplication of any amounts included in clause (iii)(v) above, 100% of the
aggregate net cash proceeds of any equity contribution received by the Company
from a holder of the Company’s Capital Stock subsequent to the Measurement Date;
plus
(x) without
duplication of any amounts included in clause (iii)(v) above, the amount
by
which Indebtedness of the Company or any Restricted Subsidiary of the Company
(other than Subordinated Indebtedness) is reduced on the Company’s consolidated
balance sheet upon the conversion or exchange of such Indebtedness into
Qualified Capital Stock of the Company subsequent to the Measurement Date;
plus
(y) 100%
of
the aggregate amount of net reduction in Restricted Investments made by the
Company or any of its Restricted Subsidiaries in any Person resulting
from:
(A) repurchases,
repayments or redemptions of such Restricted Investments by such Person,
proceeds realized upon the sale of such Restricted Investment (other than
a sale
to a Restricted Subsidiary of the Company), repayments of loans or advances
or
other transfers of assets (including by way of dividend, interest payment
or
distribution) by such Person to the Company or any Restricted Subsidiary;
and
(B) the
sale
(other than to the Company or a Restricted Subsidiary) of the Capital Stock
of
an Unrestricted Subsidiary or a distribution or a dividend from an Unrestricted
Subsidiary or an interest payment by an Unrestricted Subsidiary;
plus
(z) upon
the
redesignation of any Unrestricted Subsidiary as a Restricted Subsidiary,
the
Fair Market Value of the Investments of the Company or a Restricted Subsidiary
(other than such Restricted Subsidiary) in such Unrestricted Subsidiary as
of
the date of such redesignation.
The
preceding provisions do not prohibit:
(1) the
payment of any dividend (i) within 60 days after the date of declaration
of such
dividend if the dividend would have been permitted on the date of declaration
or
(ii) to the extent such dividend was declared prior to the Measurement
Date;
(2) the
acquisition of any shares of Capital Stock of the Company, either (i) solely
in
exchange for shares of Qualified Capital Stock of the Company or (ii) through
the application of net proceeds of a substantially concurrent sale for cash
(other than to a Subsidiary of the Company or an employee stock ownership
plan
or similar trust to the extent such sale to an employee stock ownership plan
or
similar trust is financed by loans from or is guaranteed by the Company or
any
Restricted Subsidiary (unless such loans have been repaid with cash on or
prior
to the Reference Date)) of shares of Qualified Capital Stock of the Company;
provided
that the
net cash proceeds from such sale of Qualified Capital Stock shall be excluded
from clause (iii)(v) above;
(3) the
acquisition of any Subordinated Indebtedness of the Company or any of its
Restricted Subsidiaries either (i) solely in exchange for shares of Qualified
Capital Stock of the Company, or (ii) through the application of net proceeds
of
a substantially concurrent sale for cash (other than to a Subsidiary of the
Company or an employee stock ownership plan or similar trust to the extent
such
sale to an employee stock ownership plan or similar trust is financed by
loans
from or is guaranteed by the Company or any Restricted Subsidiary (unless
such
loans have been repaid with cash on or prior to the Reference Date)) of (a)
shares of Qualified Capital Stock of the Company; provided
that the
net cash proceeds from such sale of Qualified Capital Stock will be excluded
from clause (iii)(v) above, or (b) Refinancing Indebtedness;
(4) repurchases
by the Company of Common Stock of the Company from current or former employees,
officers and directors or consultant of the Company or any of its Restricted
Subsidiaries or their authorized representatives (a) upon the death,
disability or termination of employment of such employees, officers or directors
or (b) pursuant to any management equity subscription agreement, stock
option agreement, stock ownership plan, put agreement, stockholder agreement
or
similar agreement that may be in effect from time to time, in an aggregate
amount for clauses (a) and (b) not to exceed $2.0 million in any calendar
year
(with unused amounts in any calendar year (before giving effect to any
carryforward) being carried over to the next succeeding (but not any other)
calendar year);
(5) if
no
Event of Default or payment Default shall have occurred and be
continuing,
the
declaration or payment,
from
time to time,
by the
Company of any dividend or distribution so
long
as the amount of such dividends and distributions (taken together with all
other
dividends and distributions made by the Company with respect to the applicable
taxable year) does not exceed the amount that
the
senior management of the Company determines in good faith to be necessary
for
the
Company to
(x)
maintain its status as a REIT under
the
Code and
(y)
reduce excise taxes (in
an
amount not to exceed the amount of such excise taxes that would have been
imposed for such taxable year if no such dividend or distribution had been
made); provided
that the
senior management’s d
(6) termination
of such amount shall be based on senior management’s estimates of the Company’s
REIT taxable income for the taxable year to which such dividend or distribution
relates; and
(7) repurchases
of (A) Capital Stock deemed to occur upon exercise of stock options if such
Capital Stock represents a portion of the exercise price of such options,
(B) Capital Stock from directors, officers, and employees in connection
with the vesting of such person’s restricted stock to the extent necessary to
allow such employees to pay taxes in connection with restricted stock that
has
vested and (C) Capital Stock or options to purchase Capital Stock deemed
to
occur in connection with the exercise of stock options to the extent necessary
to pay applicable withholding taxes;
(8) cash
payments in lieu of the issuance of fractional shares in connection with
the
exercise of warrants, options or other securities convertible into or
exchangeable for Capital Stock of the Company;
(9) Restricted
Payments in an amount not to exceed $35.0 million; and
(10) the
purchase, repurchase, redemption, defeasance or other acquisition or retirement
for value of any Subordinated Indebtedness (i) at a purchase price not greater
than 101% of the principal amount of such Subordinated Indebtedness in the
event
of a Change of Control in accordance with provisions similar to Section 4.16
or
(ii) at a purchase price not greater than 100% of the principal amount thereof
in accordance with provisions similar to Section 4.11; provided
that
prior to or simultaneously with such purchase, repurchase, redemption,
defeasance or other acquisition or retirement for value, the Company has
made
the Change of Control Offer or Net Proceeds Offer, as applicable, as provided
in
Section 4.11 with respect to the Notes and has completed the repurchase or
redemption of all Notes validly tendered for payment in connection with such
Change of Control Offer or Net Proceeds Offer.
In
determining the aggregate amount of Restricted Payments made subsequent to
the
Measurement Date in accordance with clause (iii) of the immediately preceding
paragraph, amounts expended pursuant to clauses (1)(i), (2)(ii), (4), (5),
(6)(B), (8) and (9) shall be included in such calculation and the amounts
under
(1)(ii), 2(i), 3, 6(A), 6(C) and (7) and the dividend declared by the Company
on
March 24, 2006 to be paid on or about April 28, 2006 shall be excluded.
The
amount of all Restricted Payments (other than cash) shall be the Fair Market
Value on the date of such Restricted Payment of the asset(s) or securities
proposed to be paid, transferred or issued by the Company or such Restricted
Subsidiary, as the case may be, pursuant to such Restricted Payment. Not
later
than the date on which the Company is required to deliver financial statements
pursuant to Section 4.03 with respect to the fiscal quarter during which
any
Restricted Payment is made, the Company shall deliver to the Trustee an
officers’ certificate stating that such Restricted Payment is permitted and
setting forth the basis upon which the calculations required by this Section
4.07 were computed, together with a copy of any fairness opinion or appraisal
required by this Indenture.
In
making
the computations required by clause (iii)(u) of the first paragraph of this
Section 4.07, the Company may rely on projections prepared in good faith
by
senior management of the Company for the fiscal quarter ending on the Reference
Date, whether or not financial statements for such period are internally
available.
SECTION
3.07. Maintenance
of Total Unencumbered Assets.
The
Total
Unencumbered Assets of the Company and its Consolidated Restricted Subsidiaries
shall be at least 200% of the aggregate principal amount of the Unsecured
Indebtedness of the Company and its Consolidated Restricted Subsidiaries,
in
each case as of the last day of any fiscal quarter of the Company during
the
term of the Notes (it being understood that compliance with this Section
shall
be determined on the date financial statements are required to be delivered
with
respect to such fiscal quarter pursuant to Section 4.03 or, if earlier, the
date
such financial statements are actually delivered).
SECTION
3.08. Dividend
and Other Payment Restrictions Affecting Restricted Subsidiaries.
The
Company will not, and will not cause or permit any of its Restricted
Subsidiaries 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 of its Restricted Subsidiaries to:
(1) pay
dividends or make any other distributions on or in respect of its Capital
Stock
(it being understood that the priority of any Preferred Stock in receiving
dividends or liquidating distributions prior to dividends or liquidating
distributions being paid on Common Stock shall not be deemed a restriction
on
the ability to make distributions on Capital Stock);
(2) make
loans or advances or to pay any Indebtedness or other obligation owed to
the
Company or any other Restricted Subsidiary of the Company (it being understood
that the subordination of loans or advances made to the Company or any
Restricted Subsidiary to other Indebtedness Incurred by the Company or any
Restricted Subsidiary shall not be deemed a restriction on the ability to
make
loans or advances); or
(3) transfer
any of its property or assets to the Company or any other Restricted Subsidiary
of the Company,
except
for such encumbrances or restrictions existing under or by reason
of:
(a) applicable
law, rule, regulation or order (including any restrictions imposed by Xxxxxx
Xxx
or Xxxxxx Xxx or similar organizations);
(b) this
Indenture and the Notes;
(c) customary
non-assignment provisions of any contract or any lease governing a leasehold
interest of any Restricted Subsidiary of the Company;
(d) any
instrument governing Acquired Indebtedness, which encumbrance or restriction
is
not applicable to any Person, or the properties or assets of any Person,
other
than the Person or the properties or assets of the Person so
acquired;
(e) (i)
agreements existing on the Measurement Date including each Warehouse Facility
and agreements governing other Indebtedness existing on the Measurement Date
to
the extent and in the manner such agreements are in effect on the Measurement
Date and (ii) any new Indebtedness incurred after the Measurement Date in
accordance with this Indenture on terms that (A) are not less favorable to
the
Company than the Warehouse Facility and agreements governing other Indebtedness
existing on the Measurement Date in any material respect as determined by
the
senior management in their reasonable and good faith judgment or (B) are
not
materially more restrictive, taken as a whole, than customary provisions
in
comparable financings and that the Board of Directors determines (as evidenced
by a resolution of the Board of Directors) in good faith would not reasonably
be
expected to impair the ability of the Company to make scheduled payments
of
interest on and principal of the Notes as and when due;
(f) provisions
of any agreement governing Indebtedness incurred in accordance with this
Indenture that impose such encumbrances or restrictions upon the occurrence
of a
default or failure to meet financial covenants or conditions under the
agreement;
(g) restrictions
on the transfer of assets (other than cash) held in a Restricted Subsidiary
of
the Company imposed under any agreement governing Indebtedness incurred in
accordance with this Indenture;
(h) provisions
of any agreement governing Indebtedness incurred in accordance with this
Indenture that require a Restricted Subsidiary to service its debt obligations
before making dividends, distributions or advancements in respect of its
Capital
Stock;
(i) an
agreement governing Indebtedness incurred to Refinance all or part of the
Indebtedness issued, assumed or incurred pursuant to an agreement referred
to in
clause (b), (d) or (e) above; provided,
however,
that
the provisions relating to such encumbrance or restriction contained in any
such
Indebtedness are not materially less favorable to the Company in any material
respect as determined by the senior management of the Company in their
reasonable and good faith judgment than the provisions relating to such
encumbrance or restriction contained in agreements referred to in such clause
(b), (d) or (e);
(j) agreements
governing any Securitization Vehicle or group of Securitization Vehicles
(and
limited to such Securitization Vehicle or group of Securitization Vehicles)
that, in the good faith determination of the Board of Directors or senior
management of the Company, are necessary or advisable to effect a Securitization
after the Measurement Date;
(k) with
respect to clause (3) only, (i) any security agreements or mortgages securing
Indebtedness of a Restricted Subsidiary to the extent such encumbrance or
restriction restricts the transfer of the property subject to such security
agreements or mortgages or (ii) any transfer of, agreement to transfer, option
or right with respect to, or Lien
(l) on,
any
property or assets of the Company or any Restricted Subsidiary not otherwise
prohibited by this Indenture;
(m) contracts
for the sale of assets, including 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 of the Capital Stock or assets of
such
Restricted Subsidiary pending the closing of such sale or disposition;
or
(n) any
requirement to obtain Board of Directors or independent board member approval
prior to payment of any dividend or other distribution.
SECTION
3.09. Limitation
on Incurrence of Additional Non-Funding Indebtedness.
The
Company will not, and will not permit any of its Restricted Subsidiaries
to,
directly or indirectly, create, incur, assume, guarantee, become liable,
contingently or otherwise, with respect to, or otherwise become responsible
for
payment of (collectively, “incur”)
any
Non-Funding Indebtedness (including Acquired Indebtedness) other than Permitted
Indebtedness.
Notwithstanding
the foregoing, if no Default or Event of Default shall have occurred and
be
continuing at the time of or as a consequence of the incurrence of any such
Non-Funding Indebtedness (including Acquired Indebtedness), the Company or
any
of its Restricted Subsidiaries may incur Non-Funding Indebtedness (including
Acquired Indebtedness), in each case if on the date of the incurrence of
such
Non-Funding Indebtedness (including Acquired Indebtedness), after giving
effect
to the incurrence thereof and the use of proceeds thereof:
(a) the
Consolidated Non-Funding Indebtedness Interest Coverage Ratio of the Company
is
greater than 3.25 to 1.0; and
(b) the
ratio
of Consolidated Tangible Net Worth of the Company to the aggregate amount
of
Non-Funding Indebtedness outstanding on a consolidated basis is greater than
2.0
to 1.0.
If
the
Company or any Restricted Subsidiary incurs any Non-Funding Indebtedness
on any
date and also incurs any Permitted Indebtedness on such date, such Permitted
Indebtedness shall be disregarded for purposes of calculating the ratios
described above on such date.
For
purposes of determining compliance with this Section 4.10, in the event that
an
item of Indebtedness meets the criteria of more than one of the categories
of
Permitted Indebtedness described in clauses (1) through (13) of the
definition thereof or is entitled to be incurred pursuant to the second
paragraph of this Section 4.10, the Company shall, in its sole discretion,
classify (and from time to time reclassify) such item of Indebtedness in
any
manner that complies with this Section 4.10. The Company will be entitled
to
divide and classify (and from time to time reclassify) an item of Indebtedness
in more than one of the types of Indebtedness described in clauses (1) through
(13) of the definition thereof and the second paragraph of this Section 4.10.
Accrual of interest, accretion or amortization of original issue discount,
the
payment of interest on any Indebtedness in the form of additional Indebtedness
with the same terms, and the payment of dividends on Disqualified Capital
Stock
or other Preferred Stock in the form
of
additional shares of the same class of Disqualified Capital Stock or other
Preferred Stock will not be deemed to be an incurrence of Indebtedness or
an
issuance of Disqualified Capital Stock for purposes of this Section
4.10.
For
purposes of determining compliance with any U.S. dollar-denominated restriction
on the incurrence of Indebtedness, the U.S. dollar-equivalent principal amount
of Indebtedness denominated in a foreign currency shall be calculated based
on
the relevant currency exchange rate in effect on the date such Indebtedness
was
incurred, in the case of term Indebtedness, or first committed, in the case
of
revolving credit Indebtedness; provided
that if
such Indebtedness is incurred to refinance other Indebtedness denominated
in a
foreign currency, and such refinancing would cause the applicable U.S.
dollar-denominated restriction to be exceeded if calculated at the relevant
currency exchange rate in effect on the date of such refinancing, such U.S.
dollar-denominated restriction shall be deemed not to have been exceeded
so long
as the principal amount of such refinancing Indebtedness does not exceed
the
principal amount of such Indebtedness being refinanced. Notwithstanding any
other provision of this Section 4.10, the maximum amount of Indebtedness
that
the Company may incur shall not be deemed to be exceeded solely as a result
of
fluctuations in the exchange rate of currencies. The principal amount of
any
Indebtedness incurred to refinance other Indebtedness, if incurred in a
different currency from the Indebtedness being refinanced, shall be calculated
based on the currency exchange rate applicable to the currencies in which
such
Refinancing Indebtedness is denominated that is in effect on the date of
such
refinancing.
SECTION
3.10. Limitation
on Asset Sales.
The
Company will not, and will not permit any of its Restricted Subsidiaries
to,
consummate an Asset Sale unless:
(1) the
Company or such Restricted Subsidiary receives consideration at the time
of such
Asset Sale at least equal to the Fair Market Value of the assets sold or
otherwise disposed of;
(2) at
least
75% of the consideration received by the Company or the Restricted Subsidiary,
as the case may be, from such Asset Sale shall be in the form of cash, Cash
Equivalents and/or Replacement Assets (as defined in clause 3(b) below) and/or
any securities, notes or other obligations received by the Company or any
such
Restricted Subsidiary from such transferee that are converted by the Company
or
such Restricted Subsidiary into cash (to the extent of the cash received)
within
60 days after receipt and is received at the time of such disposition;
provided
that the
amount of any liabilities of the Company or any such Restricted Subsidiary
as
shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet
(other than liabilities that are by their terms subordinated to the Notes
or any
Guarantee of a Guarantor) that are assumed by the transferee of any such
assets
shall be deemed to be cash for purposes of this provision; and
(3) except
as
provided in the next paragraph upon the consummation of an Asset Sale, the
Company shall apply, or cause such Restricted Subsidiary to apply, the Net
Cash
Proceeds relating to such Asset Sale within 360 days of receipt
thereof:
(4) to
permanently reduce Indebtedness under any Non-Funding Credit Facility (including
revolving and/or term Indebtedness) and, in the case of any such Indebtedness
under any revolving credit facility, effect a dollar-for-dollar reduction
in the
commitments under such revolving credit facility;
(a) to
make
an investment in properties and assets that replace the properties and assets
that were the subject of such Asset Sale or in properties and assets (including
Capital Stock) that will be used in any Related Business (“Replacement
Assets”);
and/or
(b) a
combination of prepayment and investment permitted by the foregoing
clauses(3)(a) and (b).
On
the
361st day after an Asset Sale or such earlier date, if any, as the Board
of
Directors of the Company or of such Restricted Subsidiary determines not to
apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses
(3)(a), (3)(b) and/or (3)(c) of the preceding paragraph (each, a “Net
Proceeds Offer Trigger Date”),
such
aggregate amount of Net Cash Proceeds which have not been applied on or before
such Net Proceeds Offer Trigger Date as permitted in clauses (3)(a), (3)(b)
and/or (3)(c) of the preceding paragraph (each a “Net
Proceeds Offer Amount”)
shall
be applied by the Company or such Restricted Subsidiary to make an offer
to
purchase to all Holders (the “Net
Proceeds Offer”)
on a
date (the “Net
Proceeds Offer Payment Date”)
not
less than 30 nor more than 45 days following the applicable Net Proceeds
Offer
Trigger Date, and to all holders of Pari Passu Indebtedness in accordance
with
provisions governing any Pari Passu Indebtedness requiring the Company or
such
Restricted Subsidiary to prepay, purchase or redeem such Pari Passu Indebtedness
with the proceeds from any Asset Sales (or offer to do so), from all Holders
(and holders of any such Pari Passu Indebtedness) on a pro rata basis, that
amount of Notes (and Pari Passu Indebtedness) equal to the Net Proceeds Offer
Amount at a price (the “Net
Proceeds Offer Price”)
equal
to 100% of the principal amount of the Notes (and Pari Passu Indebtedness)
to be
purchased, plus accrued and unpaid interest thereon, if any, to the date
of
purchase; provided,
however,
that
(i) if at any time any non-cash consideration received by the Company or
any
Restricted Subsidiary of the Company, as the case may be, in connection with
any
Asset Sale is converted into or sold or otherwise disposed of for cash (other
than interest received with respect to any such non cash consideration),
then
such conversion or disposition shall be deemed to constitute an Asset Sale
hereunder and the Net Cash Proceeds thereof shall be applied in accordance
with
this Section 4.11 and (ii) the Net Proceeds Offer Price for any such Pari
Passu
Indebtedness may exceed 100% of principal amount plus accrued and unpaid
interest thereon to the date of purchase if so provided under the relevant
documentation, in which case the Company shall use other funds to pay such
excess, including any Net Cash Proceeds that would otherwise remain after
consummation of the Net Proceeds Offer.
The
Company may defer the Net Proceeds Offer until there is an aggregate unutilized
Net Proceeds Offer Amount equal to or in excess of $15.0 million resulting
from
one or more Asset Sales (at which time, the entire unutilized Net Proceeds
Offer
Amount, and not just the amount in excess of $15.0 million, shall be applied
as
required pursuant to this paragraph). Pending the final application of any
Net
Cash Proceeds, the Company or any Restricted Subsidiary may temporarily reduce
borrowings under any revolving credit facility, including any Warehouse
Facility, or otherwise temporarily invest such Net Cash Proceeds in any manner
that is not prohibited by this Indenture.
To
the
extent Holders properly tender Notes and holders of Pari Passu Indebtedness
properly tender such Pari Passu Indebtedness in an aggregate principal amount
exceeding the Net Proceeds Offer Amount, the tendered Notes and Pari Passu
Indebtedness will be purchased, repaid or redeemed out of Net Cash Proceeds
on a
pro rata basis based on the aggregate principal amounts of Notes and Pari
Passu
Indebtedness tendered (and the Trustee shall select the tendered Notes of
tendering Holders on a pro rata basis based on the amount of Notes tendered),
provided
that the
Net Proceeds Offer Price of any Pari Passu Indebtedness for this purpose
shall
be deemed equal to 100% of principal amount plus accrued and unpaid interest
thereon to the date of purchase. A Net Proceeds Offer shall remain open for
a
period of 20 business days or such longer period as may be required by law.
If
any Net Cash Proceeds remain after the consummation of any Net Proceeds Offer,
the Company may use those Net Cash Proceeds for any purpose not otherwise
prohibited by this Indenture. Upon completion of each Net Proceeds Offer,
the
amount of Net Cash Proceeds will be reset at zero.
In
the
event that the Company shall be required to commence an offer to Holders
to
purchase Notes pursuant to this Section 4.11, it shall follow the
procedures specified in Section 3.09.
SECTION
3.11. Additional
Restricted Subsidiary Guarantees.
If
the
Company or any of its Restricted Subsidiaries transfers or causes to be
transferred, in one transaction or a series of related transactions, any
property to any Domestic Restricted Subsidiary (other than a Securitization
Vehicle or an Excluded Subsidiary) that is not a Guarantor, or if the Company
or
any of its Restricted Subsidiaries shall organize, acquire or otherwise invest
in another Domestic Restricted Subsidiary (other than a Securitization Vehicle
or an Excluded Subsidiary) having total assets with a book value in excess
of
$500,000, then such transferee, acquired or other Domestic Restricted Subsidiary
shall:
(1) execute
and deliver to the Trustee a supplemental indenture in form reasonably
satisfactory to the Trustee pursuant to which such Domestic Restricted
Subsidiary shall unconditionally guarantee all of the Company’s obligations
under the Notes and the Indenture on the terms set forth in the Indenture;
and
(2) deliver
to the Trustee an opinion of counsel that such supplemental indenture has
been
duly authorized, executed and delivered by such Domestic Restricted Subsidiary
and constitutes a legal, valid, binding and enforceable obligation of such
Domestic Restricted Subsidiary subject to customary exceptions.
Thereafter,
such Domestic Restricted Subsidiary shall be a Guarantor for all purposes
of the
Indenture until released from its Guarantee in accordance with the provisions
of
the Indenture.
SECTION
3.12. Transactions
with Affiliates.
The
Company will not, and will not permit any of its Restricted Subsidiaries
to,
directly or indirectly, enter into or permit to exist any transaction (including
the purchase, sale, lease or exchange of any property or the
rendering
of
any
service) with, or for the benefit of, any of its Affiliates (each an
“Affiliate
Transaction”),
other
than:
(1) Affiliate
Transactions otherwise permitted in this Section 4.13; and
(2) Affiliate
Transactions on terms that are no less favorable to the Company or such
Restricted Subsidiary than those that might reasonably have been obtained
in a
comparable transaction at such time on an arm’s-length basis from a Person that
is not an Affiliate of the Company or such Restricted Subsidiary.
All
Affiliate Transactions (and each series of related Affiliate Transactions
which
are part of a common plan) involving aggregate payments or other property
with a
fair market value in excess of $5.0 million shall be approved by the Board
of
Directors of the Company or of such Restricted Subsidiary, as the case may
be,
such approval to be evidenced by a Board Resolution stating that such Board
of
Directors has determined that such transaction complies with the foregoing
provisions. If the Company or any Restricted Subsidiary of the Company enters
into an Affiliate Transaction (or a series of related Affiliate Transactions
which are part of a common plan) that involves an aggregate fair market value
of
more than $15.0 million, the Company or such Restricted Subsidiary, as the
case
may be, shall, prior to the consummation thereof, obtain a favorable opinion
as
to the fairness of such transaction or series of related transactions to
the
Company or the relevant Restricted Subsidiary, as the case may be, from a
financial point of view, from an investment banking, appraisal or accounting
firm, in each case of national standing, and file the same with the
Trustee.
The
restrictions set forth in the first two paragraphs of this Section 4.13 shall
not apply to:
(1) reasonable
fees and compensation paid to and employee benefits plans or arrangements
and
indemnity provided to or on behalf of, officers, directors, employees or
consultants of the Company or any Restricted Subsidiary of the Company as
determined in good faith by the Company’s Board of Directors or senior
management;
(2) transactions
between or among the Company and any of its Restricted Subsidiaries or between
or among such Restricted Subsidiaries; provided
such
transactions are not otherwise prohibited by this Indenture;
(3) any
agreement as in effect as of the Measurement Date or any amendment thereto
or
any transaction contemplated thereby (including pursuant to any amendment
thereto) in any replacement agreement thereto so long as any such amendment
or
replacement agreement is not more disadvantageous to the Holders in any material
respect than the original agreement as in effect on the Measurement Date
as
determined in good faith by the Board of Directors or senior management of
the
Company;
(4) Restricted
Payments and Permitted Investments permitted by this Indenture;
(5) transactions
between the Company or one of its Restricted Subsidiaries and any Person
in
which the Company or one of its Restricted Subsidiaries has made an Investment
and such Person is an Affiliate solely because of such Investment;
(6) any
issuance of Capital Stock of or capital contributions to the
Company;
(7) transactions
with customers, clients, suppliers, or purchasers or sellers of goods or
services, in each case in the ordinary course of business and otherwise in
compliance with the terms of this Indenture, which are fair to the Company
or
its Restricted Subsidiaries, or are on terms at least as favorable as might
reasonably have been obtained at such time from an unaffiliated party, in
each
case in the reasonable determination of the Board of Directors or the senior
management thereof; and
(8) transactions
between the Company or one of its Restricted Subsidiaries and any Securitization
Vehicle in the ordinary course of business.
SECTION
3.13. Liens.
The
Company will
not,
and will not cause or permit any of its Restricted Subsidiaries to, directly
or
indirectly, create, incur, assume or permit or suffer to exist any Lien of
any
kind on the assets of the Company or any of its Restricted Subsidiaries securing
Indebtedness of the Company or any of its Restricted Subsidiaries
unless:
(1) in
the
case of Liens securing Indebtedness of the Company or any Guarantor that
is
expressly subordinate or junior in right of payment to the Notes, or the
Guarantee of such Guarantor, as the case may be, the Notes or the Guarantee
of
such Guarantor, as the case may be, are secured by a Lien on such property,
assets or proceeds that is senior in priority to such Liens; and
(2) in
all
other cases, the Notes or the Guarantee of such Guarantor, as the case may
be,
are equally and ratably secured except for:
(a) Liens
existing as of the Measurement Date to the extent and in the manner such
Liens
are in effect on the Measurement Date;
(b) Liens
securing the Notes and the Guarantees;
(c) Liens
securing Refinancing Indebtedness that is incurred to Refinance any Indebtedness
that has been secured by a Lien permitted under this Indenture and that has
been
incurred in accordance with the provisions of this Indenture; provided,
however,
that
such Liens do not extend to or cover any property or assets of the Company
not
securing the Indebtedness so Refinanced; and
(d) Permitted
Liens.
SECTION
3.14. Existence;
Conduct of Business.
(1) Subject
to Article V, the Company shall do or cause to be done all things necessary
to preserve and keep in full force and effect (i) its corporate existence,
and the corp
(2) rate,
partnership or other existence of each of its Subsidiaries, in accordance
with
the respective organizational documents (as the same may be amended from
time to
time) of the Company or any such Restricted Subsidiary and (ii) the rights
(charter and statutory), licenses and franchises of the Company and its
Restricted Subsidiaries; provided,
however,
that
the Company shall not be required to preserve any such right, license or
franchise, or the corporate, partnership or other existence of any of its
Restricted Subsidiaries, if the senior management of the Company determines
in
good faith that the preservation thereof is no longer desirable in the conduct
of the business of the Company and its Restricted Subsidiaries, taken as
a
whole, and that the loss thereof is not likely to result in a material adverse
effect on the Company and its Restricted Subsidiaries taken as a whole;
provided,
further,
that
the Company shall not be required to maintain its status as a REIT.
(3) The
Company and its Restricted Subsidiaries will engage primarily in the business
of
originating, purchasing, retaining, selling and servicing loans and other
activities related, ancillary or complementary to or arising out of those
activities.
SECTION
3.15. Repurchase
at the Option of Holders upon a Change of Control.
Upon
the
occurrence of a Change of Control and unless the Company has previously
exercised its right to redeem all of the outstanding Notes pursuant to Section
3.07, each Holder shall have the right to require that the Company purchase
all
or a portion of such Holder’s Notes pursuant to the offer described below (the
“Change
of Control Offer”),
at a
purchase price equal to (i) 101% of the principal amount thereof plus (ii)
accrued and unpaid interest to the date of purchase (such sum, the “Change
of Control Payment”).
Within
30
days following the date upon which the Change of Control occurred, the Company
must send, by first class mail, a notice to each Holder, with a copy to the
Trustee, which notice shall govern the terms of the Change of Control Offer.
Such notice shall state:
(1) that
a
Change of Control Offer is being made pursuant to this Section 4.16 and that
all
Notes validly tendered and not withdrawn pursuant to such Change of Control
Offer will be accepted for payment by the Company;
(2) the
purchase price and the purchase date, which must be no earlier than 30 days
nor
later than 60 days from the date such notice is mailed, other than as may
be
required by law (the “Change
of Control Payment Date”);
(3) that
any
Note not tendered or accepted for payment shall continue to accrue
interest;
(4) that,
unless the Company defaults in the payment of the Change of Control Payment,
all
Notes accepted for payment pursuant to the Change of Control Offer shall
cease
to accrue interest after the Change of Control Payment Date;
(5) that
Holders electing to have a Note purchased pursuant to a Change of Control
Offer
shall be required to surrender the Note, with the form entitled “Option of
Holder to Elect Purchase” on the reverse of the Note completed, to the Paying
Agent at
(6) the
address specified in the notice prior to the close of business on the third
business day prior to the Change of Control Payment Date;
(7) that
Holders shall be entitled to withdraw their election if the Paying Agent
receives, not later than the close of business on the second Business Day
preceding the Change of Control Payment Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of Notes delivered for purchase, and a statement that such Holder
is
withdrawing his election to have the Notes purchased;
(8) that
Holders whose Notes are being purchased only in part shall be issued new
Notes
equal in principal amount to the unpurchased portion of the Notes surrendered,
which unpurchased portion must be equal to at least $2,000 in principal amount
and integral multiple of $1,000.
The
Company will comply with the requirements of Rule 14e-1 under the Exchange
Act (or any successor rules) and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in connection
with the repurchase of the Notes pursuant to a Change of Control Offer. To
the
extent that the provisions of any securities laws or regulations conflict
with
the provisions of this Section 4.16, the Company shall comply with such
securities laws and regulations and shall not be deemed to have breached
its
obligations under this Section 4.16.
On
the
Change of Control Payment Date, the Company shall, to the extent
lawful:
(1) accept
for payment all Notes or portions thereof properly tendered pursuant to the
Change of Control Offer;
(2) deposit
with the Paying Agent an amount equal to the Change of Control Payment in
respect of all Notes or portions thereof so tendered; and
(3) deliver
or cause to be delivered to the Trustee the Notes so accepted together with
an
Officers’ Certificate stating the aggregate principal amount of Notes or
portions thereof being purchased by the Company.
Notwithstanding
anything to the contrary in this Indenture, if the Change of Control Payment
Date is on or after an interest record date and on or before the related
interest payment date, any accrued and unpaid interest shall be paid to the
Person in whose name a Note is registered on the Change of Control Payment
Date.
The
Paying Agent shall promptly mail to each Holder of Notes so tendered the
Change
of Control Payment for such Notes, and the Trustee shall promptly authenticate
and mail (or cause to be transferred by book entry) to each Holder a new
Note
equal in principal amount to any unpurchased portion of the Notes surrendered,
if any; provided
that
each such new Note shall be in a minimum principal amount of $2,000 and an
integral multiple of $1,000. The Company shall publicly announce the results
of
the Change of Control Offer on or as soon as practicable after the Change
of
Control Payment Date.
The
provisions described above that require the Company to make a Change of Control
Offer following a Change of Control shall be applicable regardless of whether
or
not any other provisions in this Indenture are applicable.
Notwithstanding
any other provision of this Section 4.16, the Company shall not be required
to make a Change of Control Offer upon a Change of Control if a third party
makes the Change of Control Offer in the manner, at the times and otherwise
in
compliance with the requirements set forth in this Indenture applicable to
a
Change of Control Offer made by the Company and purchases all such Notes
validly
tendered and not withdrawn under such Change of Control Offer.
SECTION
3.16. Excess
Cash Flow Offer.
(a) If
the
Company’s Excess Cash Flow for the two consecutive fiscal quarter period ending
March 31, 2007 and any two fiscal quarter period thereafter (measured
semi-annually) (each such two fiscal quarter period, an “Excess
Cash Flow Period”)
exceeds zero, the Company will, on or before the 60th day (the “Trigger
Date”)
following the last day of such Excess Cash Flow Period (subject to paragraph
(e)
below), be required to make an offer to all Holders of Notes to purchase
the
principal amount of Notes equal to the lesser of the amount of Excess Cash
Flow
for such Excess Cash Flow Period and $10.0 million (the “Excess
Cash Flow Offer Amount”).
Each
offer to purchase Notes pursuant to this Section 4.17 (each, an “Excess
Cash Flow Offer”)
shall
be made to each Holder of Notes outstanding at the time of such offer, shall
offer to purchase Notes at a purchase price of 100% of the principal amount
thereof on the date of purchase, plus accrued and unpaid interest, if any,
to
the date of purchase and shall remain open for a period of not less than
20
Business Days (or any longer period as is required by law).
(b) If
the
Company is required to make an Excess Cash Flow Offer pursuant to this Section
4.17, the Company will mail a notice (the date on which such notice is mailed
being referred to as the “Excess
Cash Flow Offer Date”)
of
such Excess Cash Flow Offer, on or before the Trigger Date, to each Holder
with
a copy to the Trustee stating:
(1) that
the
Company is offering to purchase Notes in an amount equal to the Excess Cash
Flow
Offer Amount at a purchase price in cash equal to 100% of the principal amount
thereof on the date of purchase, plus accrued and unpaid interest, if any,
to
the date of purchase (subject to the right of Holders of record on the relevant
date to receive interest on the relevant interest payment date);
(2) the
purchase date (which shall be no earlier than 30 days nor later than 60 days
from the Excess Cash Flow Offer Date); and
(3) the
instructions, as determined by the Company, consistent with this Section
4.17,
that a Holder must follow in order to tender its Notes.
(4) If
the
aggregate purchase price of the Notes tendered exceeds the amount so offered,
the Company will select the Notes to be purchased on a pro
rata
basis
but in minimum denominations of $2,000 principal amount and integral multiples
of $1,000.
(c) Upon
surrender of a Note that is purchased in part, the Company shall issue and,
upon
the Company’s written request, the Trustee shall authenticate for the Holder at
the expense of the Company a new Note equal in principal amount to the
unredeemed portion of the Note surrendered; provided
that
each new Note will be in a minimum principal amount of $2,000 and an integral
multiple of $1,000.
(d) Notwithstanding
the foregoing, the Company may, upon providing the Trustee with an Officers’
Certificate so stating, suspend an Excess Cash Flow Offer or postpone making
an
Excess Cash Flow Offer, in each case for a period not to exceed 60 consecutive
days, if (1) an event or circumstance occurs and is continuing as a result
of
which the written materials distributed (or any document incorporated by
reference therein) to Holders of Notes in connection with an Excess Cash
Flow
Offer would, in the good faith judgment of the Board of Directors contain
an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading and (2) (i) the Board of Directors
determines in its good faith judgment that the disclosure of such event or
circumstance at such time would constitute material non-public information,
is
not otherwise required to be filed with or furnished to the SEC and would
have a
material adverse effect on the Company’s business, operations or prospects or
(ii) the Board of Directors otherwise determines, in its good faith judgment,
that the disclosure would constitute material non-public information, is
not
otherwise required to be filed with or furnished to with the SEC and would
relate to a material business transaction or development.
(e) The
Company will comply with the requirements of Section 14(e) under the Exchange
Act and any other securities laws and regulations thereunder to the extent
such
laws and regulations are applicable in connection with the repurchase of
Notes
pursuant to this Section 4.17. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Section 4.17,
the Company shall comply with the applicable securities laws and regulations
and
shall not be deemed to have breached its obligations under this Section 4.17
by
virtue thereof.
SECTION
3.17. [Reserved]
SECTION
3.18. Application
of Suspension Covenants.
Notwithstanding anything to the contrary in this Indenture, during the
Suspension Period, the Company and its Restricted Subsidiaries will not be
subject to the provisions of Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.13,
4.14, 4.15(2), 4.17 and clause (2) of Section 5.01 (collectively, the
“Suspendable
Covenants”).
All
other covenants and provisions of this Indenture will apply at all times
so long
as any Notes remain outstanding.
For
purposes of calculating the amount available to be made as Restricted Payments
under clause (iii) of the first paragraph of Section 4.07 following a Suspension
Period, calculations under the applicable clause will be made with reference
to
such Measurement Date as set forth in that clause. Accordingly, subject to
the
third to last paragraph of Section 4.07, Restricted Payments made during
the
Suspension Period will reduce the amount available to be made as
Restricted
Payments under clause (iii) and the items specified in subclauses (u) through
(z) of clause (iii) that occur during the Suspension Period will increase
the
amount available to be made as Restricted Payments under clause (iii), in
each
case following the Reversion Date. Any Restricted Payments made during the
Suspension Period that are of the type described in clause (4) under the
second
paragraph of Section 4.07 shall reduce the amounts permitted to be incurred
under such clause (4) on the Reversion Date. In addition, during the Suspension
Period, all references herein to “Restricted Subsidiaries” or “Unrestricted
Subsidiaries” will be deemed to be references to “Subsidiaries” and the
definitions of “Restricted Subsidiary” and “Unrestricted Subsidiary” shall be
deemed deleted. Also, any encumbrance or restriction of the type referred
to in
Section 4.09 incurred during the Suspension Period shall not result in a
Default
when such covenant is reinstituted.
For
purposes of Section 4.11, on the Reversion Date, the Net Proceeds Offer Amount
will be reset at zero.
ARTICLE
IV
SUCCESSORS
SECTION
4.01. Merger,
Consolidation, or Sale of Assets.
The
Company will not, in a single transaction or series of related transactions,
consolidate or merge with or into any Person, or sell, assign, transfer,
lease,
convey or otherwise dispose of (or cause or permit any Restricted Subsidiary
of
the Company to sell, assign, transfer, lease, convey or otherwise dispose
of)
all or substantially all of the Company’s assets (determined on a consolidated
basis for the Company and the Company’s Restricted Subsidiaries) whether as an
entirety or substantially as an entirety to any Person unless:
(1) either:
(a) the
Company shall be the surviving or continuing entity; or
(b) the
Person (if other than the Company) formed by or surviving such consolidation
or
into which the Company is merged or the Person which acquires by sale,
assignment, transfer, lease, conveyance or other disposition the properties
and
assets of the Company and of the Company’s Restricted Subsidiaries substantially
as an entirety (the “Surviving
Entity”):
(i) shall
be
a corporation, limited partnership, trust or limited liability company organized
and validly existing under the laws of the United States or any State thereof
or
the District of Columbia; provided
that if
such surviving person is not a corporation, a corporate Wholly Owned Restricted
Subsidiary of such Person organized under the laws of the United States,
any
state or the District of Columbia becomes a co-issuer of the Notes in connection
therewith; and
(ii) shall
expressly assume, by supplemental indenture (in form and substance satisfactory
to the Trustee), executed and delivered to the Trustee, the due and punctual
payment of the principal of and premium, if any, and interest on all of the
Notes and the performance of every covenant of the Notes, the Indenture and
the
Registration Rights Agreement on the part of the Company to be performed
or
observed;
(2) immediately
after giving effect to such transaction and the assumption contemplated by
clause (1)(b)(ii) above (including giving effect to any Acquired
Indebtedness and other Indebtedness incurred in connection with or in respect
of
such transaction), the Company or such Surviving Entity, as the case may
be,
shall be able to incur at least $1.00 of additional Non-Funding Indebtedness
(other than Permitted Indebtedness) in compliance with Section
4.10;
(3) immediately
before and immediately after giving effect to such transaction and the
assumption contemplated by clause (1)(b)(ii) above (including giving effect
to any Acquired Indebtedness and other Indebtedness incurred and any Lien
granted in connection with or in respect of the transaction), no Default
or
Event of Default shall have occurred or be continuing; and
(4) the
Company or the Surviving Entity shall have delivered to the Trustee an officers’
certificate and an opinion of counsel, each stating that such consolidation,
merger, sale, assignment, transfer, lease, conveyance or other disposition
and,
if a supplemental indenture is required in connection with such transaction,
such supplemental indenture comply with the applicable provisions of this
Indenture and that all conditions precedent in this Indenture relating to
such
transaction have been satisfied.
For
purposes of the foregoing, the transfer (by lease, assignment, sale or
otherwise, in a single transaction or series of transactions) of all or
substantially all of the properties or assets of one or more Restricted
Subsidiaries of the Company the Capital Stock of which constitutes all or
substantially all of the properties and assets of the Company shall be deemed
to
be the transfer of all or substantially all of the properties and assets
of the
Company.
Notwithstanding
the foregoing:
(a) clauses
(2) and (4) of this Section 5.01 will not apply to the consolidation or merger
of the Company with or into a Restricted Subsidiary or the consolidation
or
merger of a Restricted Subsidiary with or into the Company; and
(b) clause
(2) of this Section 5.01 will not apply to any merger or consolidation of
the
Company with an Affiliate formed solely for the purpose of reforming the
Company
in another jurisdiction or solely for the purpose of facilitating the formation
of a holding company.
SECTION
4.02. Successor
Corporation Substituted.
Upon
any consolidation or merger, or any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets
of the
Company in accordance with Section 5.01, the successor Person
formed
by
such consolidation or into which the Company is merged or to which such transfer
is made shall succeed to and (except in the case of a lease) be substituted
for,
and may exercise every right and power of, such Company under this Indenture
and
the Notes with the same effect as if such successor Person had been named
therein as such Company, and
(except in the case of a lease) the Company, and in the case of a transfer
of
the Company’s assets (other than the Capital Stock of its Restricted
Subsidiaries), the Guarantors (except in the case of a transfer of less than
all
of the consolidated assets of the Company) shall be released from the
obligations under the Notes and the Guarantees.
SECTION
4.03. Merger
of Guarantors.
Each
Guarantor (other than any Guarantor whose Guarantee is to be released in
accordance with the terms of the Guarantee and the Indenture) will not, and
the
Company will not cause or permit any Guarantor to, consolidate with or merge
with or into any Person other than the Company, any other Guarantor or an
Affiliate incorporated solely for the purpose of reincorporating such Guarantor
in another jurisdiction unless:
(i) the
entity formed by or surviving any such consolidation or merger (if other
than
such Guarantor) is a corporation, limited partnership, trust or limited
liability company organized and existing under the laws of the United States
or
any State thereof or the District of Columbia;
(ii) subject
to Section 5.02, entity assumes by supplemental indenture all of the obligations
of the Guarantor on this Indenture, the Guarantee or the Registration Rights
Agreement; and
(iii) immediately
after giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing.
ARTICLE
V
SECTION
5.01. Events
of Default.
Each of
the following is an “Event
of Default”
with
respect to the Notes:
(1) the
failure to pay interest on any Notes when the same becomes due and payable
and
the default continues for a period of 30 days (whether or not prohibited
by
Article XIII);
(2) the
failure to pay the principal on any Notes when such principal becomes due
and
payable, at maturity, upon redemption or otherwise (including the failure
to
make a payment to purchase Notes tendered pursuant to a Change of Control
Offer
or a Net Proceeds Offer) (whether or not prohibited by Article
XIII);
(3) a
default
in the observance or performance of any other covenant or agreement contained
in
this Indenture and such default continues for a period of 30 days after the
Company receives written notice specifying the default (and demanding
that
(4) such
default be remedied) from the Trustee or the Holders of at least 25% of the
outstanding principal amount of the Notes (except in the case of a default
with
respect to Section 5.01 as it relates to the Company, which will constitute
an
Event of Default with such notice requirement but without such passage of
time
requirement);
(5) the
failure to pay at final maturity (giving effect to any applicable grace periods
and any extensions thereof) the principal amount of any Indebtedness (other
than
Funding Indebtedness) of the Company or any Restricted Subsidiary of the
Company, or the acceleration of the final stated maturity of any such
Indebtedness (which acceleration is not rescinded, annulled or otherwise
cured
within 20 days of receipt by the Company or such Restricted Subsidiary of
notice
of any such acceleration) if the aggregate principal amount of such
Indebtedness, together with the principal amount of any other such Indebtedness
in default for failure to pay principal at final maturity or which has been
accelerated, aggregates $5.0 million or more at any time;
(6) one
or
more judgments in an aggregate amount in excess of $5.0 million shall have
been
rendered against the Company or any of its Restricted Subsidiaries (other
than a
judgment or judgments in respect of Funding Indebtedness where the judgment
creditor (in its capacity as such) does not have rights against assets of
the
Company and its Restricted Subsidiaries other than those assets that secure
such
Funding Indebtedness) and such judgments remain undischarged, unpaid or unstayed
for a period of 60 days after such judgment or judgments become final and
non-appealable (other than any judgments to the extent covered by an insurance
company that has not contested coverage of such judgment or judgments in
writing);
(7) the
Company or any of its Significant Subsidiaries pursuant to or within the
meaning
of any Bankruptcy Law:
(a) commences
a voluntary case,
(b) consents
to the entry of an order for relief against it in an involuntary
case,
(c) consents
to the appointment of a custodian of it or for all or substantially all of
its
property, or
(d) makes
a
general assignment for the benefit of its creditors;
(8) a
court
of competent jurisdiction enters an order or decree under any Bankruptcy
Law
that:
(a) is
for
relief against the Company or any of its Significant Subsidiaries in an
involuntary case;
(b) appoints
a custodian of the Company or any of its Significant Subsidiaries or for
all or
substantially all of the property of the Company or any of its Significant
Subsidiaries; or
(c) orders
the liquidation of the Company or any of its Significant
Subsidiaries;
and
the
order or decree remains unstayed and in effect for 60 consecutive days;
or
(9) any
Guarantee of a Significant Subsidiary ceases to be in full force and effect
or
any Guarantee of a Significant Subsidiary is declared to be null and void
and
unenforceable or any Guarantee of a Significant Subsidiary is found to be
invalid or any Significant Subsidiary that is a Guarantor denies its liability
under its Guarantee (other than by reason of release of a Guarantor in
accordance with the terms of this Indenture).
SECTION
5.02. Acceleration.
(a) If
an
Event of Default (other than an Event of Default specified in clause (6)
or (7)
above with respect to the Company) shall occur and be continuing, the Trustee
or
the Holders of at least 25% in the then outstanding principal amount of the
Notes may declare the principal of and accrued interest on all the then
outstanding Notes to be due and payable by notice in writing to the Company
and
the Trustee specifying the respective Event of Default and that it is a “notice
of acceleration” (the “Acceleration
Notice”),
and
the same shall become immediately due and payable.
(b) At
any
time after a declaration of acceleration with respect to the Notes as described
in Section 6.02(a), the Holders of a majority in the then outstanding
principal amount of the Notes may rescind and cancel such declaration and
its
consequences: (i) if the rescission would not conflict with any judgment or
decree; (ii) if all existing Events of Default have been cured or waived
except nonpayment of principal or interest that has become due solely because
of
the acceleration; (iii) to the extent the payment of such interest is
lawful, interest on overdue installments of interest and overdue principal,
which has become due otherwise than by such declaration of acceleration,
has
been paid; and (iv) if the Company has paid the Trustee its reasonable
compensation and reimbursed the Trustee for its expenses, disbursements and
advances. No such rescission shall affect any subsequent Default or impair
any
right consequent thereto.
(c) If
an
Event of Default specified in clause (6) or (7) above with respect to the
Company occurs and is continuing, then all unpaid principal of, and premium,
if
any, and accrued and unpaid interest on all of the then outstanding Notes
shall
become and be immediately due and payable without any declaration or other
act
on the part of the Trustee or any Holder.
SECTION
5.03. Other
Remedies.
If an
Event of Default occurs and is continuing, the Trustee may pursue any available
remedy to collect the payment of principal, premium, if any, and interest
on the
Notes or to enforce the performance of any provision of the Notes or this
Indenture.
The
Trustee may maintain a proceeding even if it does not possess any of the
Notes
or does not produce any of them in the proceeding. A delay or omission by
the
Trustee or any Holder of a Note in exercising any right or remedy accruing
upon
an Event of Default shall not impair the right or remedy or constitute a
waiver
of or acquiescence in the Event of Default. All remedies are cumulative to
the
extent permitted by law.
Waiver
of
Existing Defaults.
Holders
of not less than a majority in aggregate principal amount of the then
outstanding Notes by notice to the Trustee may on behalf of the Holders of
all
of the Notes waive any existing Default or Event of Default and its consequences
under this Indenture except a continuing Event of Default in the payment
of
interest on, or the principal of, the Notes. Upon any such waiver, such Default
shall cease to exist, and any Event of Default arising therefrom shall be
deemed
to have been cured for every purpose of this Indenture; but no such waiver
shall
extend to any subsequent or other Default or impair any right consequent
thereon.
SECTION
5.04. Control
by Majority.
Holders
of a majority in principal amount of the then outstanding Notes may direct
the
time, method and place of conducting any proceeding for exercising any remedy
available to the Trustee or exercising any trust or power conferred on it.
However, the Trustee may refuse to follow any direction that conflicts with
law
or this Indenture that the Trustee determines may be prejudicial to the rights
of other Holders of Notes or that may involve the Trustee in personal liability.
The Trustee may take any other action which it deems proper that is not
inconsistent with any such directive.
SECTION
5.05. Limitation
on Suits.
Subject
to Section 6.07 a Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:
(a) the
Holder of a Note gives to the Trustee written notice of a continuing Event
of
Default;
(b) the
Holders of at least 25% in principal amount of the then outstanding Notes
make a
written request to the Trustee to pursue the remedy;
(c) such
Holder of a Note or Holders of Notes offer and, if requested, provide to
the
Trustee indemnity satisfactory to the Trustee against any loss, liability
or
expense;
(d) the
Trustee does not comply with the request within 60 days after receipt of
the
request and the offer and, if requested, the provision of indemnity;
and
(e) during
such 60-day period the Holders of a majority in principal amount of the then
outstanding Notes do not give the Trustee a direction inconsistent with the
request.
A
Holder
of a Note may not use this Indenture to prejudice the rights of another Holder
of a Note or to obtain a preference or priority over another Holder of a
Note.
SECTION
5.06. Rights
of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any Holder
of a Note to receive payment of principal, premium, if any, and interest
on the
Note, on or after the respective due dates expressed in the Note (including
in
connection with an offer to purchase), or to bring suit for the enforcement
of
any such payment on or after such respective dates, shall not be impaired
or
affected without the consent of such Holder.
Collection
Suit by Trustee.
If an
Event of Default specified in Section 6.01(1) or (2) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name
and as
trustee of an express trust against the Company for the whole amount of
principal of, premium, if any, and interest remaining unpaid on the Notes
and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements
and
advances of the Trustee, its agents and counsel.
SECTION
5.07. Trustee
May File Proofs of Claim.
The
Trustee is authorized to file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel) and the Holders of the
Notes allowed in any judicial proceedings relative to the Company (or any
other
obligor upon the Notes), its creditors or its property and shall be entitled
and
empowered to collect, receive and distribute any money or other property
payable
or deliverable on any such claims and any custodian in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee, and in the event that the Trustee shall consent to the making of
such
payments directly to the Holders, to pay to the Trustee any amount due to
it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel,
and
any other amounts due the Trustee under Section 7.07 out of the estate in
any such proceeding, shall be denied for any reason, payment of the same
shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any
plan
of reorganization or arrangement or otherwise. Nothing herein contained shall
be
deemed to authorize the Trustee to authorize or consent to or accept or adopt
on
behalf of any Holder any plan of reorganization, arrangement, adjustment
or
composition affecting the Notes or the rights of any Holder, or to authorize
the
Trustee to vote in respect of the claim of any Holder in any such
proceeding.
SECTION
5.08. Priorities.
If the
Trustee collects any money pursuant to this Article, it shall pay out the
money
in the following order:
First:
to
the Trustee, its agents and attorneys for amounts due under Section 7.07,
including payment of all compensation, expense and liabilities incurred,
and all
advances made, by the Trustee and the costs and expenses of
collection;
Second:
to Holders of Senior Indebtedness of a Servicing Guarantor to the extent
of such
Senior Indebtedness and to the extent required by Article XIII
hereof;
Third:
to
Holders of Notes for amounts due and unpaid on the Notes for interest, without
preference or priority of any kind, according to the amounts due and payable
on
the Notes for interest;
Fourth:
to Holders of Notes for amounts due and unpaid on the Notes for principal
and
premium, without preference or priority of any kind, according to the amounts
due and payable on the Notes for principal and premium, respectively;
and
Fifth:
to
the Company or to such party as a court of competent jurisdiction shall
direct.
The
Trustee may fix a record date and payment date for any payment to Holders
of
Notes pursuant to this Section 6.10 and Section 1.05.
SECTION
5.09. Undertaking
for Costs.
In any
suit for the enforcement of any right or remedy under this Indenture or in
any
suit against the Trustee for any action taken or omitted by it as a Trustee,
a
court in its discretion may require the filing by any party litigant in the
suit
of an undertaking to pay the costs of the suit, and the court in its discretion
may assess reasonable costs, including reasonable attorneys’ fees and expenses,
against any party litigant in the suit, 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 of a Note pursuant
to
Section 6.07, or a suit by Holders of more than 10% in principal amount of
the then outstanding Notes.
SECTION
5.10. Restoration
of Rights and Remedies.
If the
Trustee or any Holder has instituted any proceeding to enforce any right
or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee
or to
such Holder, then and in every such case, subject to any determination in
such
proceedings, the Company, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as
though
no such proceeding has been instituted.
SECTION
5.11. Rights
and Remedies Cumulative.
Except
as otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Notes in Section 2.07 hereof, 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
5.12. Delay
and Omission Not Waiver.
No
delay or omission of the Trustee or of any Holder of any Note to exercise
any
right or remedy accruing upon any Event of Default shall impair any such
right
or remedy or constitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Trustee
or to the Holders may be exercised from time to time, and as often as may
be
deemed expedient, by the Trustee or by the Holders, as the case may
be.
TRUSTEE
SECTION
5.13. Duties
of Trustee.
(1) If
an
Event of Default has occurred and is continuing, the Trustee shall exercise
such
of the rights and powers vested in it by this Indenture, and use the same
degree
of care and skill in its exercise, as a prudent person would exercise or
use
under the circumstances in the conduct of such person’s own
affairs.
(2) Except
during the continuance of an Event of Default:
(a) the
duties of the Trustee shall be determined solely by the express provisions
of
this Indenture and the Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, and no implied covenants
or obligations shall be read into this Indenture against the Trustee;
and
(b) in
the
absence of bad faith on its part, the Trustee may conclusively rely, as to
the
truth of the statements and the correctness of the opinions expressed therein,
upon certificates or opinions required to be furnished to the Trustee hereunder
and conforming to the requirements of this Indenture. However, the Trustee
shall
examine the certificates and opinions to determine whether or not they conform
to the requirements of this Indenture (but need not confirm or investigate
the
accuracy of any mathematical calculations or other facts stated
therein).
(3) The
Trustee may not be relieved from liabilities for its own gross negligent
action,
its own gross negligent failure to act, or its own willful misconduct, except
that:
(a) this
paragraph does not limit the effect of paragraph (2) of this
Section;
(b) the
Trustee shall not be liable for any error of judgment made in good faith
by a
Responsible Officer, unless it is proved that the Trustee was grossly negligent
in ascertaining the pertinent facts; and
(c) the
Trustee shall not be liable with respect to any action it takes or omits
to take
in good faith in accordance with a direction received by it pursuant to
Section 6.05.
(4) Whether
or not therein expressly so provided, every provision of this Indenture that
in
any way relates to the Trustee is subject to paragraphs (1), (2), and (3)
of this Section 7.01.
(5) No
provision of this Indenture shall require the Trustee to expend or risk its
own
funds or incur any liability. The Trustee shall be under no obligation to
exercise any of its rights and powers under this Indenture at the request
of any
Holders, unless such Holder shall
(6) have
offered to the Trustee security and indemnity satisfactory to it against
any
loss, liability, claim, damage or expense.
(7) The
Trustee shall not be liable for interest on any money received by it except
as
the Trustee may agree in writing with the Company. Money held in trust by
the
Trustee need not be segregated from other funds except to the extent required
by
law.
(8) 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 or other paper
or
documents.
SECTION
5.14. Rights
of Trustee.
(1) The
Trustee may conclusively rely upon any document (whether in its original
or
facsimile form) believed by it to be genuine and to have been signed or
presented by the proper Person. The Trustee need not investigate any fact
or
matter stated in the document but the Trustee, in its discretion, may make
such
further inquiry or investigation into such facts or matters as it may see
fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney at the sole cost of the
Company and shall incur no liability or additional liability of any kind
by
reason of such inquiry or investigation.
(2) Before
the Trustee acts or refrains from acting, it may require an Officers’
Certificate or an Opinion of Counsel or both. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on such
Officers’ Certificate or Opinion of Counsel. The Trustee may consult with
counsel of its own selection and the written advice or opinion of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection from liability in respect of any action taken, suffered or omitted
by
it hereunder in good faith and in reliance thereon.
(3) The
Trustee may act through its attorneys and agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due
care.
(4) The
Trustee shall not be liable for any action it takes or omits to take in good
faith that it believes to be authorized or within the rights or powers conferred
upon it by this Indenture.
(5) Unless
otherwise specifically provided in this Indenture, any demand, request,
direction or notice from the Company shall be sufficient if signed by an
Officer
of such Company.
(6) The
Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Indenture at the request or direction of any of the
Holders
unless such Holders shall have offered to the Trustee reasonable security
or
indemnity satisfactory to it against the costs, expenses and liabilities
that
might be incurred by it in compliance with such request or
direction.
(7) The
Trustee shall not be charged with knowledge of any Default or Event of Default
unless either (a) a Responsible Officer of the Trustee shall have actual
knowledge of such Default or Event of Default or (b) written notice of such
Default or Event of Default shall have been given to and received by a
Responsible Officer of the Trustee by the Company or any Holder.
(8) In
no
event shall the Trustee be responsible or liable for special, indirect or
consequential loss or damage of any kind whatsoever (including loss of profit)
irrespective of whether the Trustee has been advised of the likelihood of
such
loss or damage and regardless of the form of action.
(9) The
rights, privileges, protections, immunities and benefits given to the Trustee,
including its right to be indemnified, are extended to, and shall be enforceable
by, the Trustee in each of its capacities hereunder, and each agent, custodian
and other Person employed by the Trustee to act hereunder.
(10) In
the
event the Company is required to pay Special Interest, the Company will provide
written notice to the Trustee of the Company’s obligation to pay Special
Interest no later than 15 days prior to the next Interest Payment Date, which
notice shall set forth the amount of the Special Interest to be paid by the
Company. The Trustee shall not at any time be under any duty or responsibility
to any Holders to determine whether the Special Interest is payable and the
amount thereof.
SECTION
5.15. Individual
Rights of Trustee.
The
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Company or any Affiliate of the
Company
with the same rights it would have if it were not Trustee. However, in the
event
that the Trustee acquires any conflicting interest it must eliminate such
conflict within 90 days, apply to the SEC for permission to continue as trustee
or resign. Any Agent may do the same with like rights and duties. The Trustee
is
also subject to Sections 7.10 and 7.11.
SECTION
5.16. Trustee’s
Disclaimer.
The
Trustee shall not be responsible for and makes no representation as to the
validity or adequacy of this Indenture or the Notes, it shall not be accountable
for the Company’s use of the proceeds from the Notes or any money paid to the
Company or upon the Company’s direction under any provision of this Indenture,
it shall not be responsible for the use or application of any money received
by
any Paying Agent other than the Trustee, and it shall not be responsible
for any
statement or recital herein or any statement in the Notes or any other document
in connection with the sale of the Notes or pursuant to this Indenture other
than its certificate of authentication.
SECTION
5.17. Notice
of Defaults.
If a
Default or Event of Default occurs and is continuing and if it is known to
a
Responsible Officer of the Trustee, the Trustee shall mail to Holders of
Notes a
notice of the Default or Event of Default within 90 days after the Trustee
acquires knowledge thereof. Except in the case of a Default or Event of Default
in payment of principal of, premium, if any, or interest on any Note, the
Trustee may withhold the notice if and so long as a committee of its Responsible
Officers in good faith determines that withholding the notice is in the
interests of the Holders of the Notes.
Reports
by Trustee to Holders of the Notes.
By May
15th of each year, and for so long as Notes remain outstanding, the Trustee
shall mail to the Holders of the Notes a brief report dated as of such reporting
date that complies with TIA Section 313(a) (but if no event described in
TIA
Section 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with
TIA
Section 313(b)(2). The Trustee shall also transmit by mail all reports as
required by TIA Section 313(c).
A
copy of
each report at the time of its mailing to the Holders of Notes shall be mailed
to the Company and filed with the SEC and each stock exchange on which the
Notes
are listed in accordance with TIA Section 313(d). The Company shall promptly
notify the Trustee when the Notes are listed on any stock exchange.
SECTION
5.18. Compensation
and Indemnity.
The
Company, shall pay to the Trustee from time to time reasonable compensation
for
its acceptance of this Indenture, any Registration Rights Agreement and any
other document delivered in connection with any of such agreements and its
services under any of such agreements or other documents, as separately agreed
in writing. The Trustee’s compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse
the
Trustee promptly upon request for all reasonable disbursements, advances
and
expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee’s agents and counsel.
The
Company and Guarantors shall, jointly and severally, indemnify the Trustee
against any and all losses, liabilities, claims, damages or expenses (including
reasonable legal fees and expenses) incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture,
any
Registration Rights Agreement and any other document delivered in connection
therewith (including this Section 7.07) and defending itself against any
claim (whether asserted by the Company, any Guarantor or any Holder or any
other
person) or liability in connection with the exercise or performance of any
of
its powers or duties hereunder, except to the extent any such loss, liability
or
expense is determined to have been caused by its own gross negligence or
willful
misconduct. The Trustee shall notify the Company promptly of any claim for
which
it may seek indemnity. Failure by the Trustee to so notify the Company shall
not
relieve the Company of its obligations hereunder. The Company shall defend
the
claim and the Trustee shall cooperate in the defense. The Trustee may have
separate counsel and the Company shall pay the reasonable fees and expenses
of
such counsel. The Company need not pay for any settlement made without its
consent, which consent shall not be unreasonably withheld.
The
obligations of the Company under this Section 7.07 shall survive
resignation or removal of the Trustee and the satisfaction and discharge
of this
Indenture.
To
secure
the Company’s payment obligations in this Section, the Trustee shall have a Lien
prior to the Notes on all money or property held or collected by the Trustee,
except that held in trust to pay principal and interest on particular Notes.
Such Lien shall survive the resignation or removal of the Trustee and the
satisfaction and discharge of this Indenture.
When
the
Trustee incurs expenses or renders services after an Event of Default specified
in Section 6.01(7) or (8) occurs, the expenses and the compensation for the
services (including the fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under any Bankruptcy
Law.
The
Trustee shall comply with the provisions of TIA Section 313(b)(2) to the
extent
applicable.
SECTION
5.19. Replacement
of Trustee.
A
resignation or removal of the Trustee and appointment of a successor Trustee
shall become effective only upon the successor Trustee’s acceptance of
appointment as provided in this Section.
The
Trustee may resign in writing at any time and be discharged from the trust
hereby created by so notifying the Company. The Holders of a majority in
principal amount of the then outstanding Notes may remove the Trustee by
so
notifying the Trustee and the Company in writing. The Company may remove
the
Trustee if:
(a) the
Trustee fails to comply with Section 7.10;
(b) the
Trustee is adjudged a bankrupt or an insolvent or an order for relief is
entered
with respect to the Trustee under any Bankruptcy Law;
(c) a
custodian or public officer takes charge of the Trustee or its property;
or
(d) the
Trustee becomes incapable of acting.
If
the
Trustee resigns or is removed or if a vacancy exists in the office of Trustee
for any reason, the Company shall promptly appoint a successor Trustee. Within
one year after the successor Trustee takes office, the Holders of a majority
in
principal amount of the then outstanding Notes may appoint a successor Trustee
to replace the successor Trustee appointed by the Company.
If
a
successor Trustee does not take office within 60 days after the retiring
Trustee
resigns or is removed, the retiring Trustee, the Company, or the Holders
of at
least 10% in principal amount of the then outstanding Notes may petition
at the
expense of the Company any court of competent jurisdiction for the appointment
of a successor Trustee.
If
the
Trustee, after written request by any Holder who has been a Holder for at
least
six months, fails to comply with Section 7.10, such Holder may petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
A
successor Trustee shall deliver a written acceptance of its appointment to
the
retiring Trustee and to the Company. Thereupon, the resignation or removal
of
the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture.
The
successor Trustee shall mail a notice of its succession to Holders. The retiring
Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee; provided
all sums
owing to the Trustee hereunder have been paid and subject
to
the
Lien provided for in Section 7.07. Notwithstanding replacement of the
Trustee pursuant to this Section 7.08, the Company’s obligations under
Section 7.07 shall continue for the benefit of the retiring
Trustee.
SECTION
5.20. Successor
Trustee by Merger, etc.If
the
Trustee consolidates, merges or converts into, or transfers all or substantially
all of its corporate trust business to, another corporation, the successor
corporation without any further act shall be the successor Trustee.
SECTION
5.21. Eligibility;
Disqualification.
There
shall at all times be a Trustee hereunder that is a corporation organized
and
doing business under the laws of the United States of America or of any state
thereof that is authorized under such laws to exercise corporate trustee
power,
that is subject to supervision or examination by federal or state authorities
and that has a combined capital and surplus of at least $100 million as set
forth in its most recent published annual report of condition.
This
Indenture shall always have a Trustee who satisfies the requirements of TIA
Sections 310(a)(1), (2) and (5). The Trustee is subject to TIA Section
310(b).
SECTION
5.22. Preferential
Collection of Claims Against the Company.
The
Trustee is subject to TIA Section 311(a), excluding any creditor relationship
listed in TIA Section 311(b). A Trustee who has resigned or been removed
shall
be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE
VI
LEGAL
DEFEASANCE AND COVENANT DEFEASANCE
SECTION
6.01. Option
to Effect Legal Defeasance or Covenant Defeasance.
The
Company and the Guarantors may, at any time, elect to have either
Section 8.02 or 8.03 be applied to the outstanding Notes and the related
Guarantees upon compliance with the conditions set forth below in this
Article VIII.
SECTION
6.02. Legal
Defeasance and Discharge.
Upon
the
exercise by the Company and the Guarantors under Section 8.01 of the option
applicable to this Section 8.02, the Company and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.04, be
deemed to have been discharged from their obligations applicable to the
outstanding Notes and the related Guarantees on the date the conditions set
forth below are satisfied (hereinafter, “Legal
Defeasance”).
For
this purpose, Legal Defeasance means that the Company and the Guarantors
shall
be deemed to have paid and discharged the entire Indebtedness represented
by the
outstanding Notes and the Guarantees, which shall thereafter be deemed to
be
“outstanding” only for the purposes of Section 8.05 and the other Sections
of this Indenture referred to in (1) and (2) below, and to have satisfied
all
their other obligations under such Notes, this Indenture, the related Guarantees
and any Registration Rights Agreement (and the Trustee, on demand of and
at the
expense of the Company, shall execute proper instruments acknowledging the
same), except for the following provisions which shall survive until otherwise
terminated or discharged hereunder:
the
rights of Holders to receive payments in respect of the principal of, premium,
if any, and interest on the Notes when such payments are due from the trust
referred to below;
(1) the
Company’s obligations with respect to the Notes concerning issuing temporary
Notes, registration of Notes, mutilated, destroyed, lost or stolen Notes
and the
maintenance of an office or agency for payments held in trust;
(2) the
rights, powers, trust, duties and immunities of the Trustee and the Company’s
obligations in connection therewith; and
(3) the
Legal
Defeasance provisions of this Indenture.
Subject
to compliance with this Article VIII, the Company may exercise its option
under this Section 8.02 notwithstanding the prior exercise of its option
under Section 8.03.
SECTION
6.03. Covenant
Defeasance.
Upon
the
exercise by the Company and the Guarantors under Section 8.01 of the option
applicable to this Section 8.03, the Company and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.04, be
released from their obligations applicable to Notes under the covenants
contained in Sections 4.03, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14,
4.15(2), 4.16, 4.17, 5.01(2), 5.03 and with respect to outstanding Notes
and the
related Guarantees on and after the date the conditions set forth in
Section 8.04 are satisfied (hereinafter, “Covenant
Defeasance”),
and
the Notes shall thereafter be deemed not “outstanding” for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such Sections, but shall
continue to be deemed “outstanding” for all other purposes hereunder (it being
understood that such Notes may not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect
to the
outstanding Notes and the related Guarantees, 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, whether directly or indirectly, by reason
of any
reference elsewhere herein to any such Section or by reason of any reference
in
any such Section to any other provision herein or in any other document and
such
omission to comply shall not constitute a Default or an Event of Default
under
Section 6.01, but, except as specified above, the remainder of this
Indenture and such Notes shall be unaffected thereby. In addition, upon the
Company’s exercise under Section 8.01 of the option applicable to this
Section 8.03, subject to the satisfaction of the conditions set forth in
Section 8.04, Sections 6.01(3) through 6.01(8) shall not constitute
Events of Default. In addition, upon Covenant Defeasance, the applicable
Guarantees of each Guarantor shall be released.
SECTION
6.04. Conditions
to Legal or Covenant Defeasance.
The
following shall be the conditions to the application of either Section 8.02
or 8.03 to the outstanding Notes:
In
order
to exercise either Legal Defeasance or Covenant Defeasance:
(1) the
Company must irrevocably deposit with the Trustee (or another qualifying
trustee, collectively for purposes of this Section 8.04 and
Section 8.05, the "Trustee"),
in
trust, for the benefit of the Holders cash in U.S. dollars, non-callable
Government Securities or a combination thereof, in such amounts as will be
sufficient (without
(2) reinvestment),
in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and interest on the
outstanding Notes on the stated date for payment thereof or on the applicable
redemption date, as the case may be, and the Company and the Guarantors must
specify whether the Notes are being defeased to maturity or to a particular
redemption date;
(3) in
the
case of Legal Defeasance, the Company shall have delivered to the Trustee
an
Opinion of Counsel reasonably acceptable to the Trustee confirming that,
subject
to customary assumptions and exclusions:
(a) the
Company has received from, or there has been published by, the Internal Revenue
Service a ruling; or
(b) since
the
date of this Indenture, there has been a change in the applicable federal
income
tax law,
and,
in
either case to the effect that, the Holders of the outstanding Notes will
not
recognize income, gain or loss for federal income tax purposes as a result
of
such Legal Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the
case if
such Legal Defeasance had not occurred;
(4) in
the
case of Covenant Defeasance, the Company shall have delivered to the Trustee
an
Opinion of Counsel confirming that, subject to customary assumptions and
exclusions the Holders of the outstanding Notes will not recognize income,
gain
or loss for federal income tax purposes as a result of such Covenant Defeasance
and will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred;
(5) no
Default (other than a Default resulting from the borrowing of funds to be
applied to such deposit and grant of any Lien securing such borrowing) shall
have occurred and be continuing on the date of such deposit;
(6) such
Legal Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a default under any material agreement or instrument
(other than this Indenture) to which the Company or any of its Subsidiaries
is a
party or by which the Company or any of its Subsidiaries is bound;
(7) the
Company must have delivered to the Trustee an Opinion of Counsel to the effect
that after the 91st
day,
assuming no intervening bankruptcy, that no Holder is an insider of the Company
following the deposit and that such deposit would not be deemed by a court
of
competent jurisdiction a transfer for the benefit of the Company in its capacity
as issuer of the Notes, the trust funds will not be subject to the effect
of any
applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ rights generally;
(8) the
Company shall have delivered to the Trustee an Officers’ Certificate stating
that the deposit was not made by the Company with the intent of preferring
the
Holders over any other creditors of the Company or any Guarantor or with
the
intent of defeating, hindering, delaying or defrauding any other creditors
of
the Company, any Guarantor or others; and
(9) the
Company shall have delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel (which opinion of counsel may be subject to customary
assumptions and exclusions), each stating that all conditions precedent provided
for or relating to the Legal Defeasance or the Covenant Defeasance have been
complied with.
Notwithstanding
the foregoing, the Opinion of Counsel required by clause (2) above with
respect to a Legal Defeasance need not be delivered and the conditions set
forth
in clauses 4(b) and (6) shall not apply if all applicable Notes not
theretofore delivered to the Trustee for cancellation
(a) have
become due and payable or
(b) will
become due and payable on the maturity date or a redemption date 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.
SECTION
6.05. Deposited
Money and Government Securities to Be Held in Trust; Other Miscellaneous
Provisions.
Subject
to Section 8.06, all money and non-callable Government Securities
(including the proceeds thereof) deposited with the Trustee pursuant to
Section 8.04 in respect of the outstanding Notes shall be held in trust and
applied by the Trustee, in accordance with the provisions of such Notes and
this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as Paying Agent) as the Trustee may determine,
to
the Holders of such Notes of all sums due and to become due thereon in respect
of principal, premium, if any, and interest (including any Special Interest),
but such money need not be segregated from other funds except to the extent
required by law.
Money
and Government Securities so held in trust are not subject to Article
XIII.
The
Company shall pay and indemnify the Trustee against any tax, fee or other
charge
imposed on or assessed against the cash or non-callable Government Securities
deposited pursuant to Section 8.04 or the principal 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 Notes.
Anything
in this Article VIII to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon the request of the Company
any money or non-callable Government Securities held by it as provided in
Section 8.04 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under
Section 8.04(1)), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
Repayment
to Company.
Any
money deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of, premium, if any, or
interest on any Note and remaining unclaimed for two years after such principal,
and premium, if any, or interest has become due and payable shall be paid
to the
Company on its request or shall be discharged from such trust; and the Holder
of
such Note shall thereafter, as an unsecured general creditor, look only to
the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company
as
trustee thereof, shall thereupon cease; provided,
however,
that
the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once,
in
The
New York Times
and
The
Wall Street Journal
(national edition), 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 notification or publication, any unclaimed balance of such money then
remaining shall be repaid to the Company.
SECTION
6.06. Reinstatement.
If the
Trustee or Paying Agent is unable to apply any United States dollars or
non-callable Government Securities in accordance with Section 8.02 or 8.03,
as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company’s obligations under this Indenture and the Notes,
shall be revived and reinstated as though no deposit had occurred pursuant
to
Section 8.02 or 8.03 until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.02 or 8.03,
as the case may be; provided,
however,
that,
if the Company or any Guarantor makes any payment of principal of, premium,
if
any, or interest on any Note following the reinstatement of its obligations,
the
Company or any Guarantor, as the case may be, shall be subrogated to the
rights
of the Holders of such Notes to receive such payment from the money held
by the
Trustee or Paying Agent.
ARTICLE
VII
AMENDMENT,
SUPPLEMENT AND WAIVER
SECTION
7.01. Without
Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, from
time
to time, the Company, the Guarantors and the Trustee, without the consent
of, or
prior notice to, the Holders, may amend this Indenture:
(1) to
cure
any ambiguity, defect or inconsistency;
(2) to
provide for uncertificated Notes in addition to or in place of certificated
Notes;
(3) to
provide for or confirm the issuance of Additional Notes;
(4) to
provide for the assumption of the Company’s or any Guarantor’s obligations to
Holders of Notes in the case of a merger or consolidation or sale of all
or
substantially all of the assets of the Company pursuant to
Article V;
(5) to
add or
release any Guarantee in accordance with the provisions of this
Indenture;
(6) to
make
any change that would provide any additional rights or benefits to the Holders
of Notes or that does not materially adversely affect the legal rights under
this Indenture of any Holder;
(7) to
comply
with requirements of the SEC in order to effect or maintain the qualification
of
this Indenture under the TIA or otherwise as necessary to comply with applicable
law;
(8) to
evidence and provide for the acceptance and appointment under this Indenture
of
a successor Trustee thereunder pursuant to the requirements
thereof;
(9) to
provide for the issuance of (x) Exchange Notes or (y) private exchange notes
which are identical to Exchange Notes except that they are not freely
transferable;
(10) to
conform the text of this Indenture, Guarantees or the Notes to any provision
of
the “Description of notes” section of the Offering Memorandum to the extent that
such provision in such “Description of notes” section was intended to be a
verbatim recitation of a provision of this Indenture, Guarantee or Notes;
or
(11) making
any amendment to the provisions of this Indenture relating to the transfer
and
legending of Notes as permitted by this Indenture, including, without limitation
to facilitate the issuance and administration of the Notes; provided,
however,
that
(i) compliance with this Indenture as so amended would not result in Notes
being
transferred in violation of the Securities Act or any applicable securities
law
and (ii) such amendment does not materially and adversely affect the rights
of
Holders to transfer Notes.
Upon
the
request of the Company and the Guarantors accompanied by a Board Resolution
authorizing the execution of any such amended or supplemental Indenture,
Notes
or Guarantee (or an amendment or supplement of any of the foregoing), and
upon
receipt by the Trustee of the documents described in Section 7.02, the
Trustee shall join with the Company and the Guarantors in the execution of
any
amended or supplemental Indenture, Notes or Guarantee authorized or permitted
by
the terms of this Indenture and to make any further appropriate agreements
and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supplemental Indenture, Notes or
Guarantee that affects its own rights, duties or immunities under this
Indenture, Notes or Guarantee or otherwise. Notwithstanding the foregoing,
no
Opinion of Counsel shall be required in connection with the addition of a
Guarantor under this Indenture upon execution and delivery by such Guarantor
and
the Trustee of a supplemental indenture to this Indenture and delivery of
an
Officer’s Certificate.
SECTION
7.02. With
Consent of Holders of Notes.
Except
as provided below in this Section 9.02, this Indenture, the Notes or the
Guarantees may be amended or supplemented with the consent of the Holders
of at
least a majority in aggregate principal amount of the Notes then outstanding.
This includes consents obtained in connection with a purchase of, or a tender
offer or exchange offer for, Notes. Any existing Default or compliance with
any
provision of this Indenture,
the
Notes
or the Guarantees (other than any provision relating to the rights of any
Holder
to bring suit for the enforcement of any payment of principal, premium, if
any,
and interest on such Holder’s Notes, on or after the scheduled due dates
expressed in the Notes) may be waived with the consent of the Holders of
a
majority in aggregate principal amount of the then outstanding Notes (including
consents obtained in connection with a purchase of, or a tender offer or
exchange offer for, Notes). Sections 2.08 and 2.09 shall determine which
Notes are considered to be “outstanding” for purposes of this
Section 9.02.
Upon
the
request of the Company accompanied by a Board Resolution authorizing the
execution of any such amended or supplemental Indenture, Notes or Guarantee
(or
an amendment or supplement of any of the foregoing), and upon the filing
with
the Trustee of evidence satisfactory to the Trustee of the consent of the
Holders of Notes as aforesaid, and upon receipt by the Trustee of the documents
(if any) described in Section 7.02, the Trustee shall join with the Company
and the Guarantors in the execution of such amended or supplemental Indenture,
Notes or Guarantee (or such amendment or supplement) unless such amended
or
supplemental Indenture, Notes or Guarantee (or such amendment or supplement)
directly affects the Trustee’s own rights, duties or immunities under this
Indenture, Notes or Guarantee or otherwise, in which case the Trustee may
in its
discretion, but shall not be obligated to, enter into such amended or
supplemental Indenture, Notes or Guarantee (or such amendment or
supplement).
It
shall
not be necessary for the consent of the Holders of Notes under this
Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves
the
substance thereof.
After
an
amendment, supplement or waiver under this Section 9.02 becomes effective,
the Company shall mail to the Holders of Notes a notice briefly describing
the
amendment, supplement or waiver. Any failure of the Company to mail such
notice,
or any defect therein, shall not, however, in any way impair or affect the
validity of any such amended or supplemental Indenture, Notes or Guarantee
(or
such amendment) or waiver. Without the consent of each Holder affected thereby,
an amendment, supplement or waiver under this Section 9.02 may not (with
respect to any Notes held by such Holder):
(1) reduce
the principal amount of Notes whose Holders must consent to an
amendment;
(2) reduce
the rate of or change the time for payment of interest, including defaulted
interest, on any Notes;
(3) reduce
the principal of or change the fixed maturity of any Notes, or change the
date
on which any Notes may be subject to redemption or reduce the redemption
price
therefor;
(4) make
any
Notes payable in money other than that stated in the Notes;
(5) make
any
change in provisions of this Indenture that impairs the right of each Holder
to
receive payment of principal of and interest on such Note on or after
the
(6) due
date
thereof or to bring suit to enforce such payment, or permitting Holders of
a
majority in principal amount of Notes to waive payment Defaults or Events
of
Default;
(7) after
the
Company’s obligation to purchase Notes arises thereunder, amend, change or
modify in any material respect the obligation of the Company to make and
consummate a Change of Control Offer in the event of a Change of Control
or make
and consummate a Net Proceeds Offer with respect to any Asset Sale that has
been
consummated or modify any of the provisions or definitions with respect
thereto;
(8) modify
or
change any provision of this Indenture or the related definitions affecting
the
subordination or ranking of the Notes or any Guarantee in a manner which
adversely affects the Holders; or
(9) release
any Guarantor from any of its obligations under its Guarantee or this Indenture
otherwise than in accordance with the terms of this Indenture.
SECTION
7.03. Compliance
with Trust Indenture Act.
Every
amendment or supplement to this Indenture or the Notes shall be set forth
in an
amended or supplemental Indenture that complies with the TIA as then in
effect.
SECTION
7.04. Revocation
and Effect of Consents.
Until
an amendment, supplement or waiver becomes effective, a consent to it by
a
Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same
debt as
the consenting Holder’s Note, even if notation of the consent is not made on any
Note. However, any such Holder of a Note or subsequent Holder of a Note may
revoke the consent as to its Note if the Trustee receives written notice
of
revocation before the date the waiver, supplement or amendment becomes
effective. After an amendment, supplement or waiver becomes effective, it
shall
bind every Holder. An amendment, supplement or waiver becomes effective once
both (i) the requisite number of consents have been received by the Company
or
the Trustee and (ii) such amendment, supplement or waiver has been executed
by
the Company, the Guarantors and the Trustee.
The
Company may, but shall not be obligated to, fix a record date for the purpose
of
determining the Holders entitled to give their consent or take any other
action
described above or required or permitted to be taken pursuant to this Indenture.
If a record date is fixed, then notwithstanding the immediately preceding
paragraph, those Persons who were Holders at such record date (or their duly
designated proxies), and only those Persons, shall be entitled to give such
consent or to revoke any consent previously given or to take any such action,
whether or not such Persons continue to be Holders after such record
date.
SECTION
7.05. Notation
on or Exchange of Notes.
The
Trustee may place an appropriate notation about an amendment, supplement
or
waiver on any Note thereafter authenticated. The Company in exchange for
all
Notes may issue and the Trustee shall, upon receipt of an Authentication
Order,
authenticate new Notes that reflect the amendment, supplement or
waiver.
Failure
to make the appropriate notation or issue a new Note shall not affect the
validity and effect of such amendment, supplement or waiver.
SECTION
7.06. Trustee
to Sign Amendments, etc.
The
Trustee shall sign any amended or supplemental Indenture, Notes or Guarantee
(or
an amendment or supplement to any of the foregoing) authorized pursuant to
this
Article IX if the amendment or supplement does not adversely affect the
rights, duties, liabilities or immunities of the Trustee under this Indenture
or
otherwise. The Company and the Guarantors may not sign an amendment or
supplemental Indenture until their respective Boards of Directors approve
it. In
executing any amended or supplemental indenture, the Trustee shall be provided
with and (subject to Section 7.01) shall be fully protected in relying
upon, in addition to the documents required by Section 11.04, an Officer’s
Certificate and an Opinion of Counsel, in each case from the Company, stating
that the execution of such amended or supplemental indenture is authorized
or
permitted by this Indenture.
SECTION
7.07. Payments
for Consent.
The
Company will not, and will not permit any of its Subsidiaries to, directly
or
indirectly, pay or cause to be paid any consideration to or for the benefit
of
any Holder of Notes for or as an inducement to any consent, waiver or amendment
of any of the terms or provisions of this Indenture or the Notes unless such
consideration is offered to be paid and is paid to all Holders of Notes that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or amendment.
ARTICLE
VIII
GUARANTEE
SECTION
8.01. Unconditional
Guarantee.
Each of
the Guarantors hereby jointly and severally, unconditionally guarantees to
the
Holders of all Notes authenticated and delivered by the Trustee and to the
Trustee and its successors and assigns that: (i) the principal of,
interest, premium, if any, on the Notes will be promptly paid in full when
due,
subject to any applicable grace period, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal, if any, and
interest on any interest, to the extent lawful, of the Notes and all other
Obligations of the Company to the Holders or the Trustee hereunder or thereunder
will be promptly paid in full or performed, all in accordance with the terms
hereof and thereof; and (ii) in case of any extension of time of payment or
renewal of any Notes or of any such other Obligations, the same will be promptly
paid in full when due or performed in accordance with the terms of the extension
or renewal, subject to any applicable grace period, whether at stated maturity,
by acceleration or otherwise. Failing payment when due of any amount so
guaranteed or any performance so guaranteed for whatever reason, the Guarantors
shall be jointly and severally obligated to pay the same immediately. Each
Guarantor agrees that this is a guarantee of payment and not a guarantee
of
collection. Each of the Guarantors agrees that its obligations hereunder
shall
be unconditional, irrespective of the validity, regularity or enforceability
of
the Notes or this Indenture, the absence of any action to enforce the same,
any
waiver or consent by any Holder with respect to any provisions hereof or
thereof, the recovery of any judgment against the Company, and action to
enforce
the same or any other circumstance which might
otherwise
constitute a legal or equitable discharge or defense of a guarantor. Each
Guarantor waives diligence, presentment, demand of payment, filing of claims
with a court in the event of insolvency or bankruptcy of the Company, any
right
to require a proceeding first against the Company, protest, notice and all
demands whatsoever and covenants that this Guarantee will not be discharged
except by complete performance of the Obligations contained in the Notes,
this
Indenture and this Guarantee, and waives any and all defenses available to
a
surety (other than payment in full). Each Guarantor also agrees to pay any
and
all costs and expenses (including reasonable attorneys’ fees) incurred by the
Trustee or any Holder in enforcing any rights under this Section 10.01. If
any
Holder or the Trustee is required by any court or otherwise to return to
the
Company or the Guarantors, or any custodian, trustee, liquidator or other
similar official acting in relation to the Company or the Guarantors, any
amount
paid by the Company or the Guarantors to the Trustee or such Holder, this
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect. Each Guarantor further agrees that, as between the Guarantors,
on the one hand, and the Holders and the Trustee, on the other hand,
(x) the maturity of the obligations guaranteed hereby may be accelerated as
provided in Article VI for the purposes of this Guarantee, notwithstanding
any stay, injunction or other prohibition preventing such acceleration in
respect of the Obligations guaranteed hereby, and (y) in the event of any
acceleration of such obligations as provided in Article VI, such
Obligations (whether or not due and payable) shall forthwith become due and
payable by the Guarantors for the purpose of this Guarantee.
The
Guarantors shall have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights
of
the Holders under the Guarantees.
Each
Guarantee shall remain in full force and effect and continue to be effective
should any petition be filed by or against the Company for liquidation,
reorganization, should the Company become insolvent or make an assignment
for
the benefit of creditors or should a receiver or trustee be appointed for
all or
any significant part of the Company’s assets, and shall, to the fullest extent
permitted by law, continue to be effective or be reinstated, as the case
may be,
if at any time payment and performance of the Notes are, pursuant to applicable
law, rescinded or reduced in amount, or must otherwise be restored or returned
by any oblige on the Notes or Guarantees, whether as a “voidable preference,”
“fraudulent transfer” or otherwise, all as though such payment or performance
had not been made. In the event that any payment or any part thereof, is
rescinded, reduced, restored or returned, the Notes shall, to the fullest
extent
permitted by law, be reinstated and deemed reduced only by such amount paid
and
not so rescinded, reduced, restored or returned.
Except
to
the extent provided in Article XIII with respect to the Guarantees of Servicing
Guarantors, the Guarantee issued by any Guarantor shall be a general unsecured
obligation of such Guarantor.
Each
payment to be made by a Guarantor in respect of its Guarantee shall be made
without set-off, counterclaim, reduction or diminution of any kind or
nature.
SECTION
8.02. Severability.
In
case
any provision of this Guarantee 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.
Waiver
of
Subrogation.
Until
all Obligations under the Notes are paid in full, each Guarantor irrevocably
waives any claims or other rights which it may now or hereafter acquire against
the Company that arise from the existence, payment, performance or enforcement
of the Guarantors’ Obligations under its Guarantee and this Indenture, including
any right of subrogation, reimbursement, exoneration, indemnification, and
any
right to participate in any claim or remedy of any Holder against the Company,
whether or not such claim, remedy or right arises in equity, or under contract,
statute or common law, including the right to take or receive from the Company,
directly or indirectly, in cash or other property or by setoff or in any
other
manner, payment or security on account of such claim or other rights. If
any
amount shall be paid to the Guarantors in violation of the preceding sentence
and the Notes shall not have been paid in full, such amount shall have been
deemed to have been paid to the Guarantors for the benefit of, and held in
trust
for the benefit of, the Holders, and shall forthwith be paid to the Trustee
for
the benefit of the Holders to be credited and applied upon the Notes, whether
matured or unmatured, in accordance with the terms of this Indenture. Each
Guarantor acknowledges that it will receive direct and indirect benefits
from
the financing arrangements contemplated by this Indenture and that the waiver
set forth in this Section 10.03 is knowingly made in contemplation of such
benefits.
SECTION
8.03. Execution
of Guarantee.
To
evidence its Guarantee to the Holders set forth in this Article X, each
Guarantor agrees to execute the Guarantee endorsed on each Note ordered to
be
authenticated and delivered by the Trustee. Each Guarantor agrees that its
Guarantee set forth in this Article X shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of such
Guarantee. Each such Guarantee shall be signed on behalf of each Guarantor
by
one of its authorized Officers prior to the authentication of the Note on
which
it is endorsed, and the delivery of such Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of such
Guarantee on behalf of the Guarantors. Such signatures upon the Guarantee
may be
by manual or facsimile signature of such Officer and may be imprinted or
otherwise reproduced on the Guarantee, and in case any such Officer who shall
have signed the Guarantee shall cease to be such Officer before the Note
on
which such Guarantee is endorsed shall have been authenticated and delivered
by
the Trustee or disposed of by the Company, such Note nevertheless may be
authenticated and delivered or disposed of as though the Person who signed
the
Guarantee had not ceased to be such Officer of the Guarantors.
If
required by Section 4.12, the Company shall cause any newly created or acquired
Restricted Subsidiary to comply with the provisions of Section 4.12 hereof
and
this Article X, to the extent applicable.
SECTION
8.04. Waiver
of Stay, Extension or Usury Laws.
Each
Guarantor covenants (to the extent that it may lawfully do so) that it will
not
at any time insist upon, plead, or in any manner whatsoever claim or take
the
benefit or advantage of, any stay or extension law or any usury law or other
law
that would prohibit or forgive it from performing its Guarantee as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which
may
affect the covenants or the performance of this Indenture; and (to the extent
that it may lawfully do so) each Guarantor 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.
Each
Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that
it
is the intention of all such parties that the Guarantee of such Guarantor
not
constitute a fraudulent transfer or conveyance for purposes of Bankruptcy
Law,
the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act
or
any similar federal or state law to the extent applicable to any Guarantee.
To
effectuate the foregoing intention, the Trustee, the Holders and the Guarantors
hereby irrevocably agree that the obligations of each Guarantor shall be
limited
to the maximum amount as will, after giving effect to such maximum amount
and
all other contingent and fixed liabilities of such Guarantor that are relevant
under such laws and after giving effect to any collections from, rights to
receive contribution from or payments made by or on behalf of any other
Guarantor in respect of the obligations of such other Guarantor under this
Article X, result in the obligations of such Guarantor under its Guarantee
not
constituting a fraudulent conveyance or fraudulent transfer under applicable
law. Each Guarantor that makes a payment under its Guarantee shall be entitled
upon payment in full of all guaranteed obligations under this Indenture to
a
contribution from each other Guarantor in an amount equal to such other
Guarantor’s pro rata
portion
of such payment based on the respective net assets of all the Guarantors
at the
time of such payment determined in accordance with GAAP.
SECTION
8.05. Release
of Guarantors
(a) The
Guarantors shall be released from their obligations under the Guarantees
under
the circumstances described in Section 5.02.
(b) In
the
event that any of the Capital Stock of a Guarantor is sold by the Company
(including by way of a merger) and, as a result of such sale, such Guarantor
ceases to be a Subsidiary of the Company and the sale complies with Section
4.11, such Guarantor’s Guarantee shall be released (it being understood that
only such portion of the Net Cash Proceeds as is or is required to be applied
on
or before the date of such release in accordance with the terms of this
Indenture needs to be so applied). It is expressly acknowledged that the
application of the Net Cash Proceeds of any such sale or other disposition
following the date of such release shall not be a condition precedent to
such
release and any failure to make such application as required by such
Section 4.11 shall not cause the revocation of any such release (it being
understood that such failure shall constitute a Default or Event of Default,
as
applicable).
(c) Any
Guarantor that is designated as an Unrestricted Subsidiary in accordance
with
the provisions of this Indenture will be automatically released from its
Guarantee and the Indenture upon effectiveness of such designation.
(d) If
the
Guarantee of any Guarantor is released pursuant to the foregoing provisions
such
Person shall cease to be a Guarantor or otherwise a party to this Indenture
and,
upon the request by the Company, the Trustee shall execute appropriate
instruments acknowledging such termination and the release of such Person
from
its obligations hereunder and the Guarantee.
MISCELLANEOUS
SECTION
8.06. Trust
Indenture Act Controls.
If any
provision of this Indenture limits, qualifies or conflicts with the duties
imposed by TIA Section 318(c), the imposed duties shall control.
SECTION
8.07. Notices.
Any
notice or communication by the Company or the Trustee to the others is duly
given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others’
address:
If
to the
Company or the Guarantors:
Saxon
Capital, Inc.
0000
Xxx
Xxxx; Xxxxx 000
Xxxx
Xxxxx, XX 00000
Attention:
General Counsel and Corporate Secretary
With
a
copy to:
Xxxxxx,
Xxxx & Xxxxxxxx LLP
000
Xxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Telecopier
No.: (000) 000-0000
Attention:
Xxxxx Xxxxxx, Esq.
If
to the
Trustee:
Deutsche
Bank Trust Company Americas
00
Xxxx
Xxxxxx, 00xx
Xxxxx
XX:
NYC60-2710
Xxx
Xxxx,
XX 00000
Attention:
Trust and Securities Services
With
a
copy to:
Deutsche
Bank National Trust Company
for
Deutsche Bank Trust Company Americas
00
Xx
Xxxxxx Xxxxxx
Xxxxxx
Xxxxx, XX 50M01-0105
Xxxxxx,
Xxx Xxxxxx 00000
Attention:
Trust and Securities Services
Tel:
000-000-0000
Fax:
000-000-0000
The
Company, the Guarantors or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or
communications.
All
notices and communications (other than those sent to Holders) shall be deemed
to
have been duly given: at the time delivered by hand, if personally delivered;
five Business Days after being deposited in the mail, postage prepaid, if
mailed; when answered back, if telexed; when receipt acknowledged, if
telecopied; and the next Business Day after timely delivery to the courier,
if
sent by overnight air courier guaranteeing next day delivery.
Any
notice or communication to a Holder shall be mailed by first class mail,
certified or registered, return receipt requested, or by overnight air courier
guaranteeing next day delivery to its address shown on the register kept
by the
Registrar. Any notice or communication shall also be so mailed to any Person
described in TIA Section 313(c), to the extent required by the TIA. Failure
to
mail a notice or communication to a Holder or any defect in it shall not
affect
its sufficiency with respect to other Holders.
If
a
notice or communication is mailed in the manner provided above within the
time
prescribed, it is duly given, whether or not the addressee receives
it.
If
the
Company mails a notice or communication to Holders, it shall mail a copy
to the
Trustee and each Agent at the same time.
SECTION
8.08. Communication
by Holders of Notes with Other Holders of Notes.
Holders
may communicate pursuant to TIA Section 312(b) with other Holders with respect
to their rights under this Indenture or the Notes. The Company, the Guarantors,
the Trustee, the Registrar and anyone else shall have the protection of TIA
Section 312(c).
SECTION
8.09. Certificate
and Opinion as to Conditions Precedent. Upon
any
request or application by the Company to the Trustee to take any action under
this Indenture, the Company shall furnish to the Trustee:
(1) an
Officers’ Certificate in form and substance reasonably satisfactory to the
Trustee (which shall include the statements set forth in Section 11.05)
stating that, in the opinion of the signers, all conditions precedent and
covenants, if any, provided for in this Indenture relating to the proposed
action have been satisfied; and
(2) an
Opinion of Counsel in form and substance reasonably satisfactory to the Trustee
(which shall include the statements set forth in Section 11.05) stating
that, in the opinion of such counsel, all such conditions precedent and
covenants have been satisfied.
SECTION
8.10. Statements
Required in Certificate or Opinion.
Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (other than a certificate provided pursuant
to
TIA Section 314(a)(4)) shall comply with the provisions of TIA Section 314(e)
and shall include:
a
statement that the Person making such certificate or opinion has read such
covenant or condition;
(1) 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;
(2) a
statement that, in the opinion of such Person, he or she 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
satisfied (and in the case of an Opinion of Counsel, may be limited to reliance
on an Officer’s Certificate as to matters of fact); and
(3) a
statement as to whether or not, in the opinion of such Person, such condition
or
covenant has been satisfied.
SECTION
8.11. Rules
by Trustee and Agents.
The
Trustee may make reasonable rules for action by or at a meeting of Holders.
The
Registrar or Paying Agent may make reasonable rules and set reasonable
requirements for its functions.
SECTION
8.12. No
Personal Liability of Directors, Officers, Employees, Incorporators, Members
and
Stockholders.
No
past, present or future director, officer, employee, incorporator agent or
stockholder of the Company or any Guarantors, as such, will have any liability
for any obligations of the Company or the Guarantors under the Notes, this
Indenture, the Guarantees or for any claim based on, in respect of, or by
reason
of, such obligations or their creation. Each Holder of Notes by accepting
a Note
and a Guarantee waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes and the
Guarantees.
SECTION
8.13. Governing
Law.
THE
INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE
THIS
INDENTURE AND THE NOTES AND ANY GUARANTEE WITHOUT GIVING EFFECT TO THE
APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT THAT THE APPLICATION
OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. EACH OF THE PARTIES
HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF
NEW
YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE
OR
THE NOTES OR ANY GUARANTEE.
SECTION
8.14. No
Adverse Interpretation of Other Agreements.
This
Indenture may not be used to interpret any other indenture, loan or debt
agreement of the Company, its Subsidiaries or of any other Person. Any such
indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION
8.15. Successors.
All
agreements of the Company and the Guarantors in this Indenture and the Notes,
as
the case may be, shall bind their respective successors. All agreements of
the
Trustee in this Indenture shall bind its successors.
Severability.
In case
any provision in this Indenture or the Notes, as the case may be, 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
8.16. Counterpart
Originals.
The
parties may sign any number of copies of this Indenture. Each signed copy
shall
be an original, but all of them together represent the same
agreement.
SECTION
8.17. Table
of Contents, Headings, etc.The
Table
of Contents, Cross-Reference Table and Headings of the Articles and Sections
of
this Indenture have been inserted for convenience of reference only, are
not to
be considered a part of this Indenture and shall in no way modify or restrict
any of the terms or provisions.
SECTION
8.18. Qualification
of Indenture.
The
Company and the Guarantors shall qualify this Indenture under the Trust
Indenture Act in accordance with the terms and conditions of the Registration
Rights Agreement. The Trustee shall be entitled to receive from the Company
and
the Guarantors any such Officer’s Certificates, Opinions of Counsel or other
documentation as it may reasonably request in connection with any such
qualification of this Indenture under the Trust Indenture Act.
ARTICLE
IX
SATISFACTION
AND DISCHARGE
SECTION
9.01. Satisfaction
and Discharge of Indenture.
The
Notes, the Guarantees and any Registration Rights Agreement shall cease to
be of
further effect (except as to any surviving rights of registration of transfer
or
exchange of Notes herein expressly provided for), and the Trustee, on demand
of
and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of the Notes, the related Guarantees
and any Registration Rights Agreement, when
(1) either:
(a) all
Notes
theretofore authenticated and delivered (other than (i) Notes which have
been destroyed, lost or stolen or which have been replaced or paid as provided
in Section 2.07 and (ii) Notes for whose payment money has theretofore
been deposited in trust or segregated and held in trust by the Company and
thereafter repaid to the Company or discharged from such trust) have been
delivered to the Trustee for cancellation; or
(b) all
Notes
not theretofore delivered to the Trustee for cancellation have become (or
will
become within one year) due and payable and the Company has irrevocably
deposited or caused to be deposited with the Trustee as trust funds in trust
for
the purpose an amount sufficient to pay and discharge the entire Indebtedness
on
the Notes not theretofore delivered to the Trustee for cancellation, for
principal (of premium, if any) and interest on the Notes to the date of the
maturity or redemption thereof, as the case may be, together with irrevocable
instru
(c) tions
from the Company directing the Trustee to apply such funds to the payment
thereof at maturity or redemption, as the case may be;
(2) the
Company has paid or caused to be paid all other sums payable hereunder by
the
Company; and
(3) the
Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that all conditions precedent herein provided for relating
to the satisfaction and discharge of the Notes have been complied
with.
When
the
Notes have ceased to be of further effect pursuant to this Section 12.01,
then
this Indenture shall cease to be of further effect, and the Trustee, on demand
of and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture. Notwithstanding
the
satisfaction and discharge of the Notes or this Indenture pursuant to this
Article XII, the obligations of the Company to the Trustee under
Section 7.07, and, if money shall have been deposited with the Trustee
pursuant to subclause (b) of clause (1) of this Section, the
obligations of the Trustee under Section 12.02 shall survive such
satisfaction and discharge.
SECTION
9.02. Application
of Trust Money.
All
money deposited with the Trustee pursuant to Section 12.01 shall be held in
trust and applied by it, in accordance with the provisions of the Notes and
this
Indenture, to the payment, either directly or through any Paying Agent as
the
Trustee may determine, to the Persons entitled thereto, of the principal
(and
premium, if any) and interest for whose payment such money has been deposited
with the Trustee.
ARTICLE
X
SUBORDINATION
OF CERTAIN GUARANTEES
SECTION
10.01. Agreement
to Subordinate.
Each
Servicing Guarantor agrees, and each Holder by accepting a Note agrees, that
the
obligations of such Servicing Guarantor under its Guarantee are subordinated
in
right of payment, to the extent and in the manner provided in this
Article XIII, to the prior payment in full of all MSR Advances
(“Senior
Indebtedness”)
and
that the subordination is for the benefit of and enforceable by the lenders
under any Warehouse Facility pursuant to which MSR Advances are made (a “Senior
Indebtedness Facility”). Each Servicing Guarantor’s obligations under its
Guarantee shall in all respects rank pari
passu
in right
of payment with all existing and future Senior Subordinated Indebtedness
of such
Servicing Guarantor, and will be senior in right of payment to all existing
and
future Subordinated Indebtedness of such Servicing Guarantor; and only Senior
Indebtedness of such Servicing Guarantor shall rank senior to the obligations
of
such Guarantor under its Guarantee in accordance with the provisions set
forth
herein. For purposes of this Article XIII, the obligations of each Servicing
Guarantor under its Guarantee include any Special Interest payable pursuant
to
the provisions set forth in the Notes and the Registration Rights Agreement.
All
provisions of this Article XIII shall be subject to
Section 13.12.
SECTION
10.02. Liquidation,
Dissolution, Bankruptcy.
Upon
any
payment or distribution of the assets of a Servicing Guarantor to creditors
upon
a total or partial liquidation or
a
total or partial dissolution of such Servicing Guarantor or in a reorganization
of or similar proceeding relating to such Servicing Guarantor or its
property:
(i) the
holders of Senior Indebtedness of such Servicing Guarantor shall be entitled
to
receive payment in full in cash of such Senior Indebtedness before Holders
shall
be entitled to receive any payment; and
(ii) until
the
Senior Indebtedness of such Servicing Guarantor is paid in full in cash,
any
payment or distribution to which Holders would be entitled but for the
subordination provisions of this Indenture shall be made to holders of such
Senior Indebtedness as their interests may appear,
except
that Holders may receive Permitted Junior Securities.
SECTION
10.03. Default
on Senior Indebtedness of a Servicing Guarantor.
A
Servicing Guarantor shall not make any payment pursuant to its Guarantee
(or pay
any other Obligations relating to its Guarantee, including Special Interest,
fees, costs, expenses, indemnities and rescission or damage claims)
(collectively, “pay
its Guarantee”)
(except in the form of Permitted Junior Securities) if either of the following
occurs (a “Guarantor
Payment Default”):
(i) any
Obligation of such Servicing Guarantor on any Senior Indebtedness is not
paid in
full in cash when due (after giving effect to any applicable grace period);
or
(ii) any
other
default under any Senior Indebtedness Facility of such Servicing Guarantor
occurs and the maturity of Senior Indebtedness under such Senior Indebtedness
Facility is accelerated in accordance with its terms;
unless,
in either case, the Guarantor Payment Default has been cured or waived and
any
such acceleration has been rescinded or the Senior Indebtedness under such
Senior Indebtedness Facility has been paid in full in cash; provided,
however,
that
such Servicing Guarantor shall be entitled to pay its Guarantee without regard
to the foregoing if such Servicing Guarantor and the Trustee receive written
notice approving such payment from the trustee, agent or representative (if
any)
of all Senior Indebtedness Facilities with respect to which the Guarantor
Payment Default has occurred and is continuing.
During
the continuance of any default (other than a Guarantor Payment Default) (a
“Non-Guarantor
Payment Default”)
under
any Senior Indebtedness Facility pursuant to which Senior Indebtedness is
then
outstanding and pursuant to which the maturity thereof may be accelerated
without further notice (except such notice as may be required to effect such
acceleration) or the expiration of any applicable grace periods, such Servicing
Guarantor shall not pay its Guarantee for a period (a “Guarantee
Payment Blockage Period”)
commencing upon the receipt by the Trustee (with a copy to such Guarantor
and
the Company) of written notice (a “Guarantee
Blockage Notice”)
of
such Non-Guarantor Payment Default from the trustee, agent or representative
(if
any) of such Senior Indebtedness Facility specifying an election to effect
a
Guarantee Payment Blockage Period and ending 179 days thereafter. So long
as there shall remain outstanding any Senior Indebtedness, a Guarantee Blockage
Notice may be given only by the administrative agent under the applicable
Senior
Indebtedness Facility unless otherwise agreed to
in
writing by the requisite lenders named therein. The Guarantee Payment Blockage
Period shall end earlier if such Guarantee Payment Blockage Period is terminated
(i) by written notice to the Trustee, the relevant Servicing Guarantor and
the Company from the Person or Persons who gave such Guarantee Blockage Notice;
(ii) because the default giving rise to such Guarantee Blockage Notice is
cured, waived or otherwise no longer continuing; or (iii) because such Senior
Indebtedness has been discharged or repaid in full in cash.
Notwithstanding
the provisions described in the immediately preceding two sentences (but
subject
to the provisions contained in the first sentence of this Section 13.03 and
Section 13.02 hereof), unless the lenders under such Senior Indebtedness
Facility or the trustee, agent or representative of such Senior Indebtedness
Facility shall have accelerated the maturity of such Senior Indebtedness
or a
Guarantor Payment Default has occurred and is continuing, the relevant Servicing
Guarantor shall be entitled to resume paying its Guarantee after the end
of such
Guarantee Payment Blockage Period. No Guarantee of a Servicing Guarantor
shall
be subject to more than one Guarantee Payment Blockage Period in any consecutive
360-day period irrespective of the number of defaults with respect to Senior
Indebtedness Facilities of the relevant Servicing Guarantor during such period.
However, in no event shall the total number of days during which any Guarantee
Payment Blockage Period or Periods on a Guarantee of a Servicing Guarantor
is in
effect exceed 179 days in the aggregate during any consecutive 360-day period,
and there must be at least 181 days during any consecutive 360-day period
during
which no Guarantee Payment Blockage Period is in effect. Notwithstanding
the
foregoing, however, no default that existed or was continuing on the date
of
delivery of any Guarantee Blockage Notice to the Trustee shall be, or be
made,
the basis for a subsequent Guarantee Blockage Notice unless such default
shall
have been waived for a period of not less than 90 days.
SECTION
10.04. Demand
for Payment.
If
payment of the Notes is accelerated because of an Event of Default and a
demand
for payment is made on a Servicing Guarantor pursuant to Article X hereof,
the
Company or such Servicing Guarantor shall promptly notify the lenders under
the
relevant Senior Indebtedness Facilities of such Servicing Guarantor or the
trustee, agent or representative of such Senior Indebtedness Facility of
such
demand; provided
that any
failure to give such notice shall have no effect whatsoever on the provisions
of
this Article XIII. If any MSR Advances of a Servicing Guarantor are
outstanding, such Servicing Guarantor may not pay its Guarantee until five
Business Days after the trustee, agent or representatives of all the holders
of
such Senior Indebtedness receive notice of such acceleration and, thereafter,
may pay its Guarantee only if this Indenture otherwise permits payment at
that
time.
SECTION
10.05. When
Distribution Must Be Paid Over.
If
a
distribution is made to Holders that, due to the subordination provisions,
should not have been made to them, such Holders are required to hold it in
trust
for the holders of Senior Indebtedness of the relevant Servicing Guarantor
and
pay it over to them as their interests may appear.
SECTION
10.06. Subrogation.
After
all Senior Indebtedness of a Servicing Guarantor is paid in full and until
the
Notes are paid in full, Holders shall be subrogated to the rights of holders
of
such Senior Indebtedness to receive distributions applicable to such Senior
Indebtedness. A distribution made under this Article XIII to holders of
such Senior Indebtedness
which
otherwise would have been made to Holders is not, as between the relevant
Servicing Guarantor and Holders, a payment by such Servicing Guarantor on
such
Senior Indebtedness.
SECTION
10.07. Relative
Rights.
This
Article XIII defines the relative rights of Holders and holders of Senior
Indebtedness of a Servicing Guarantor. Nothing in this Indenture
shall:
(i) impair,
as between such Servicing Guarantor and Holders, the obligation of such
Servicing Guarantor, which is absolute and unconditional, to make payments
under
its Guarantee in accordance with its terms;
(ii) prevent
the Trustee or any Holder from exercising its available remedies upon a default
by such Servicing Guarantor under its obligations with respect to its Guarantee,
subject to the rights of holders of Senior Indebtedness of such Servicing
Guarantor to receive payments or distributions otherwise payable to Holders
and
such other rights of such holders of Senior Indebtedness as set forth herein;
or
(iii) affect
the relative rights of Holders and creditors of such Servicing Guarantor
other
than their rights in relation to holders of Senior Indebtedness.
SECTION
10.08. Subordination
May Not Be Impaired by a
Servicing Guarantor.
No
right of any holder of Senior Indebtedness of a Servicing Guarantor to enforce
the subordination of the obligations of such Guarantor under its Guarantee
shall
be impaired by any act or failure to act by such Servicing Guarantor or by
its
failure to comply with this Indenture.
SECTION
10.09. Rights
of Trustee and Paying Agent.
Notwithstanding
Section 13.03 hereof, the Trustee or any Paying Agent may continue to make
payments on the Notes and shall not be charged with knowledge of the existence
of facts that would prohibit the making of any payments unless, not less
than
two Business Days prior to the date of such payment, a Responsible Officer
of
the Trustee receives notice satisfactory to him that payments may not be
made
under this Article XIII. A Servicing Guarantor, the Registrar, the Paying
Agent, a trustee, agent or representative or a holder of Senior Indebtedness
of
such Servicing Guarantor shall be entitled to give the notice; provided,
however,
that,
if an issue of Senior Indebtedness of such Servicing Guarantor has a trustee,
agent or representative, only the trustee, agent or representative shall
be
entitled to give the notice.
The
Trustee in its individual or any other capacity shall be entitled to hold
Senior
Indebtedness of a Servicing Guarantor with the same rights it would have
if it
were not Trustee. The Registrar and the Paying Agent shall be entitled to
do the
same with like rights. The Trustee shall be entitled to all the rights set
forth
in this Article XIII with respect to any Senior Indebtedness of a Servicing
Guarantor which may at any time be held by it, to the same extent as any
other
holder of such Senior Indebtedness; and nothing in Article VII shall
deprive the Trustee of any of its rights as such holder. Nothing in this
Article XIII shall apply to claims of, or payments to, the Trustee under or
pursuant to Section 7.07 hereof or any other Section of this
Indenture.
Distribution
or Notice to Representative.
Whenever a distribution is to be made or a notice given to holders of Senior
Indebtedness of a Servicing Guarantor, the distribution may be made and the
notice given to their trustee, agent or representative (if any).
SECTION
10.10. Article XIII
Not to Prevent Events of Default or Limit Right To Demand
Payment.
The
failure of a Servicing Guarantor to make a payment pursuant its Guarantee
by
reason of any provision in this Article XIII shall not be construed as
preventing the occurrence of a default by such Guarantor under its Guarantee.
Nothing in this Article XIII shall have any effect on the right of the
Holders or the Trustee to make a demand for payment on a Servicing Guarantor
pursuant to Article X hereof.
SECTION
10.11. Trust
Moneys Not Subordinated.
Notwithstanding anything contained herein to the contrary, payments from
money
or the proceeds of Government Securities held in trust by the Trustee for
the
payment of principal of and interest on the Notes pursuant to Article VIII
or Article XII hereof shall not be subordinated to the prior payment of any
Senior Indebtedness of any Servicing Guarantor or subject to the restrictions
set forth in this Article XIII, and none of the Holders shall be obligated
to pay over any such amount to such Servicing Guarantor or any holder of
Senior
Indebtedness of such Servicing Guarantor or any other creditor of such Servicing
Guarantor, provided
that the
subordination provisions of this Article XIII were not violated at the time
the applicable amounts were deposited in trust pursuant to Article VIII or
Article XII hereof, as the case may be
SECTION
10.12. Trustee
Entitled to Rely.
Upon
any payment or distribution pursuant to this Article XIII, the Trustee and
the Holders shall be entitled to rely (a) upon any order or decree of a
court of competent jurisdiction in which any proceedings of the nature referred
to in Section 13.02 hereof are pending, (b) upon a certificate of the
liquidating trustee or agent or other Person making such payment or distribution
to the Trustee or to the Holders or (c) upon the trustee, agent or
representatives of Senior Indebtedness of a Servicing Guarantor for the purpose
of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of such Senior Indebtedness and other Indebtedness
of
such Servicing Guarantor, the amount thereof or payable thereon, the amount
or
amounts paid or distributed thereon and all other facts pertinent thereto
or to
this Article XIII. In the event that the Trustee determines, in good faith,
that evidence is required with respect to the right of any Person as a holder
of
Senior Indebtedness of a Servicing Guarantor to participate in any payment
or
distribution pursuant to this Article XIII, the Trustee shall be entitled
to request such Person to furnish evidence to the reasonable satisfaction
of the
Trustee as to the amount of such Senior Indebtedness held by such Person,
the
extent to which such Person is entitled to participate in such payment or
distribution and other facts pertinent to the rights of such Person under
this
Article XIII, and, if such evidence is not furnished, the Trustee shall be
entitled to defer any payment to such Person pending judicial determination
as
to the right of such Person to receive such payment. The provisions of Sections
7.01 and 7.02 hereof shall be applicable to all actions or omissions of actions
by the Trustee pursuant to this Article XIII.
SECTION
10.13. Trustee
to Effectuate Subordination.
A
Holder
by its acceptance of a Note agrees to be bound by this Article XIII and
authorizes and expressly directs the Trustee, on his behalf, to take such
action
as may be necessary or appropriate to effectuate the
subordination
between the Holders and the holders of Senior Indebtedness of a Servicing
Guarantor as provided in this Article XIII and appoints the Trustee as
attorney-in-fact for any and all such purposes.
SECTION
10.14. Trustee
Not Fiduciary for Holders of Senior Indebtedness of Servicing
Guarantors.
The
Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness of a Servicing Guarantor and shall not be liable to any such
holders if it shall mistakenly pay over or distribute to Holders or such
Servicing Guarantor or any other Person, money or assets to which any holders
of
Senior Indebtedness of such Servicing Guarantor shall be entitled by virtue
of
this Article XIII or otherwise.
SECTION
10.15. Reliance
by Holders of Senior Indebtedness of a Servicing Guarantor on Subordination
Provisions.
Each
Holder by accepting a Note acknowledges and agrees that the foregoing
subordination provisions are, and are intended to be, an inducement and a
consideration to each holder of any Senior Indebtedness of a Servicing
Guarantor, whether such Senior Indebtedness was created or acquired before
or
after the issuance of the Notes, to acquire and continue to hold, or to continue
to hold, such Senior Indebtedness and such holder of such Senior Indebtedness
shall be deemed conclusively to have relied on such subordination provisions
in
acquiring and continuing to hold, or in continuing to hold, such Senior
Indebtedness.
Without
in any way limiting the generality of the foregoing paragraph, the holders
of
Senior Indebtedness of a Servicing Guarantor may, at any time and from time
to
time, without the consent of or notice to the Trustee or the Holders, without
incurring responsibility to the Trustee or the Holders and without impairing
or
releasing the subordination provided in this Article XIII or the
obligations hereunder of the Holders to the holders of the Senior Indebtedness
of such Servicing Guarantor, do any one or more of the following:
(i) change the manner, place or terms of payment or extend the time of
payment of, or renew or alter, Senior Indebtedness of such Servicing Guarantor,
or otherwise amend or supplement in any manner Senior Indebtedness of such
Servicing Guarantor, or any instrument evidencing the same or any agreement
under which Senior Indebtedness of such Servicing Guarantor is outstanding;
(ii) sell, exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing Senior Indebtedness of such Servicing Guarantor;
(iii) release any Person liable in any manner for the payment or collection
of Senior Indebtedness of such Servicing Guarantor; and (iv) exercise or
refrain from exercising any rights against such Servicing Guarantor and any
other Person.
[Signatures
on following page]
Dated
as
of May 4, 2006
COMPANY
SAXON
CAPITAL, INC.
By:
Name:
Title:
GUARANTORS
SAXON
FUNDING MANAGEMENT, INC., as Guarantor
By:
Name:
Title:
SAXON
CAPITAL HOLDINGS, INC., as Guarantor
By:
Name:
Title:
SCI
SERVICES, INC., as Guarantor
By:
Name:
Title:
SAXON
MORTGAGE SERVICES, INC., as Guarantor
By:
Name:
Title:
SAXON
MORTGAGE, INC., as Guarantor
By:
Name:
Title:
SAXON
HOLDING, INC., as Guarantor
By:
Name:
Title:
TRUSTEE
DEUTSCHE
BANK TRUST COMPANY AMERICAS, as Trustee
By:
Name:
Title:
By:
Name:
Title:
EXHIBIT
A
THE
HOLDER OF THIS NOTE BY ACCEPTANCE HEREOF ALSO AGREES, REPRESENTS AND WARRANTS
THAT IF IT IS A PURCHASER IN A SALE THAT OCCURS OUTSIDE THE UNITED STATES
WITHIN
THE MEANING OF REGULATION S OF THE SECURITIES ACT, IT ACKNOWLEDGES THAT,
UNTIL
EXPIRATION OF THE “40-DAY DISTRIBUTION COMPLIANCE PERIOD” WITHIN THE MEANING OF
RULE 903 OF REGULATION S, ANY OFFER OR SALE OF THIS NOTE SHALL NOT BE MADE
BY IT
TO A U.S. PERSON TO OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON WITHIN
THE
MEANING OF RULE 902(k) UNDER THE SECURITIES ACT.1 This
paragraph should be included only for Regulation S Global
Notes.
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OR TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUIRED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER REPRESENTATIVE
OF
THE DEPOSITORY TRUST COMPANY OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS
MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY) ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.2 This
paragraph should be included only if the Notes are issued in global
form.
TRANSFERS
OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART,
TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S
NOMINEE.3 This
paragraph should be included only if the Notes are issued in global
form.,4 This
note may be transferred in accordance with Section 2.16 of the
Indenture.
THE
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
THE (“SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION. 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, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY,
BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR
ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE
TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION
DATE”) THAT IS IN
THE CASE OF NOTES OFFERED AND SOLD UNDER RULE 144A: TWO YEARS AND IN THE
CASE OF
NOTES OFFERED AND SOLD UNDER REGULATIONS S: 40
DAYS
AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH
THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR
ANY
PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT,
(C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE
144A
UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER
IS
BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT
OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING
OF RULE 501 (a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT
OR
FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE
IN A
MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, 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, OR (F) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT
TO
THE COMPANY’S AND THE TRUSTEE’S RIGHT TO CLAUSES (E) OR (F) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST
OF
THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
[Face
of
Note]
CUSIP
NO.
[_________]5 QIB
CUSIP: 00000XXX0
Regulation
S CUSIP: U8038T AAO
IAI
CUSIP: 00000XXX0
Xxxxxxxx
Note CUSIP: 00000XXX0
Senior
Notes due 2014
No.
___
$[__________________]
SAXON
CAPITAL, INC. promises to pay to
_________________________________________________________ or its registered
assigns, the principal amount of _____________________________________________
Dollars ($______________________________) on May 1, 2014.
Interest
Payment Dates: May 1 and November 1
Record
Dates: April 15 and October 15
Subject
to Restrictions set forth in this Note.
IN
WITNESS WHEREOF, Saxon Capital, Inc. has caused this instrument to be duly
executed.
Dated:
[ ]
SAXON
CAPITAL, INC.
By:
Name:
Title:
This
is
one of the Notes referred to in the within-mentioned Indenture:
DEUTSCHE
BANK TRUST
COMPANY
AMERICAS, as Trustee
By:
Authorized
Signatory
By:
Authorized
Signatory
[Back
of
Note]
Senior
Notes due 2014
1.
Interest
Saxon
Capital, Inc., a Maryland corporation (the “Company”),
promises to pay cash interest on the principal amount of this Note at the
rate
of 12% per annum from May 4, 2006 until maturity. The interest rate on the
Notes is subject to increase pursuant to the provisions of the Registration
Rights Agreement entered into on the Measurement Date. The Company will pay
interest semi-annually in arrears on May 1 and November 1 of each year
(each an “Interest
Payment Date”),
or if
any such day is not a Business Day, on the next succeeding Business Day.
Interest on the Notes will accrue from and including the most recent date
to
which interest has been paid or, if no interest has been paid, from May 4,
2006; provided
that if
there is no existing Default in the payment of interest, and if this Note
is
authenticated between a record date referred to on the face and the next
succeeding Interest Payment Date, interest shall accrue from and including
such
next succeeding Interest Payment Date; provided,
further,
that
the first Interest Payment Date shall be November 1, 2006. The Company
shall pay interest (including post-petition interest in any proceeding under
any
Bankruptcy Law) on overdue principal and premium, if any, from time to time
on
demand at the rate then in effect; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace periods)
from
time to time on demand at the same rate. Interest will be computed on the
basis
of a 360-day year of twelve 30-day months.
|
2.
|
Method
of Payment
|
The
Company shall pay interest on the Notes (except defaulted interest) to the
Persons who are registered Holders of Notes at the close of business on the
April 15 or October 15 next preceding the Interest Payment Date, even
if such Notes are canceled after such record date and on or before such Interest
Payment Date, except as provided in Section 2.12 of the Indenture with
respect to defaulted interest. Payments in respect of the Notes represented
by
the Global Notes (including principal, premium, if any, and interest) will
be
made by wire transfer of immediately available funds to the accounts specified
by the Global Note holder. With respect to Notes in certificated form, the
Company will make all payments of principal, premium, if any, and interest,
by
wire transfer of immediately available funds to the accounts specified by
the
holders thereof or, if no such account is specified, by mailing a check to
each
such holder’s registered address. Such payment shall be in such coin or currency
of the United States of America as at the time of payment is legal tender
for
payment of public and private debts.
|
3.
|
Paying
Agent and Registrar
|
Initially,
Deutsche Bank Trust Company Americas, the Trustee under the Indenture, will
act
as Paying Agent and Registrar. The Company may change any Paying Agent or
Registrar without notice to any Holder. The Company or any of its Subsidiaries
may act in any such capacity.
4. Indenture
The
Company issued the Notes under an Indenture dated as of May 4, 2006 (the
“Indenture”)
among
the Company, the Guarantors and the Trustee. Capitalized terms not otherwise
defined herein are used herein as defined in the Indenture. The terms of
the
Notes include those stated in the Indenture and those made part of the Indenture
by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code
Sections 77aaa-77bbbb). The Notes are subject to all such terms, and Holders
are
referred to the Indenture and such Act for a statement of such terms. To
the
extent any provision of this Note conflicts with the express provisions of
the
Indenture, the provisions of the Indenture shall govern and be
controlling.
|
5.
|
Optional
Redemption
|
(a) At
any
time, or from time to time, on or prior to May 1, 2009, the Company may, at
this option, use the net cash proceeds of one or more Equity Offerings to
redeem
up to 35% of the aggregate principal amount of the Initial Notes and any
Additional Notes initially issued under the Indenture at a redemption price
of
112.000% of the principal amount thereof plus accrued and unpaid interest
thereon, if any, to the date of redemption; provided
that the
Company makes such redemption not more than 90 days after the consummation
of
any such Equity Offering.
(b) In
addition, the Notes may be redeemed, in whole or in part, at any time prior
to
final maturity at the option of the Company, at a redemption price equal
to 100%
of the principal amount of the Notes redeemed plus the Applicable Premium
as of,
and accrued and unpaid interest to, the applicable redemption date.
|
6.
|
Mandatory
Redemption and
Repurchase
|
Except
as
otherwise provided in Paragraph 7 below, the Company shall not be required
to make mandatory redemption payments with respect to the Notes or be required
to repurchase any of the Notes.
|
7.
|
Repurchase
at Option of Holder
|
(a) If
there
is a Change of Control, the Company shall make an offer (a “Change
of Control Offer”)
to
repurchase all or any part (equal to $2,000 in minimum principal amount and
integral multiples of $1,000) of each Holder’s Notes at a purchase price equal
101% of the aggregate principal amount thereof plus (ii) accrued and unpaid
cash
interest thereon, if any, to the date of purchase. The Change of Control
Offer
shall be made in accordance with Section 4.16 of the Indenture (such sum,
the
“Change
of Control Payment”).
(b) If
the
Company or a Restricted Subsidiary thereof consummates any Asset Sale, the
Company may be required to offer to purchase the Notes in accordance with
Section 4.11 of the Indenture.
(c) If
the
Company consummates any Excess Cash Flow Offer, the Company may be required
to
offer to purchase the Notes in accordance with Section 4.17 of the Indenture.
8. Denominations,
Transfer, Exchange
The
Notes
are in registered form without coupons in minimum denominations of $2,000
and
integral multiples of $1,000. The transfer of Notes may be registered and
Notes
may be exchanged as provided in the Indenture. The Registrar and the Trustee
may
require a Holder, among other things, to furnish appropriate endorsements
and
transfer documents, and the Company may require a Holder to pay any taxes
and
fees required by law or permitted by the Indenture. The Company need not
exchange or register the transfer of any Note or portion of a Note selected
for
redemption or repurchase, except for the unredeemed or unrepurchased portion
of
any Note being redeemed or repurchased in part. Also, the Company need not
exchange or register the transfer of any Notes for a period of 15 days before
a
selection of Notes to be redeemed or repurchased or during the period between
a
record date and the corresponding Interest Payment Date.
|
9.
|
Persons
Deemed Owners
|
The
registered Holder of a Note may be treated as its owner for all
purposes.
|
10.
|
Amendment,
Supplement and Waiver
|
Subject
to certain exceptions, the Indenture, the Notes or the Guarantees may be
amended
or supplemented with the consent of the Holders of at least a majority in
aggregate principal amount of the Notes then outstanding (including consents
obtained in connection with a purchase of, or tender offer or exchange offer
for, Notes), and any existing default or compliance with any provision of
the
Indenture, the Notes or the Guarantees may be waived with the consent of
the
Holders of a majority in aggregate principal amount of the Notes then
outstanding (including consents obtained in connection with a purchase of,
or
tender offer or exchange offer for, Notes).
11. Defaults
and Remedies
Each
of
the following is an Event of Default: (1) the failure to pay interest on
any
Notes when the same becomes due and payable and the default continues for
a
period of 30 days; (2) the failure to pay the principal on any Notes when
such
principal becomes due and payable, at maturity, upon redemption or otherwise
(including the failure to make a payment to purchase Notes tendered pursuant
to
a Change of Control Offer or a Net Proceeds Offer); (3) a default in the
observance or performance of any other covenant or agreement contained in
the
Indenture and such default continues for a period of 30 days after the Company
receives written notice specifying the default (and demanding that such default
be remedied) from the Trustee or the Holders of at least 25% of the outstanding
principal amount of the Notes (except in the case of a default with respect
to
Section 5.01 as it relates to the Company, which will constitute an Event
of
Default with such notice requirement but without such passage of time
requirement); (4) the failure to pay at final maturity (giving effect to
any
applicable grace periods and any extensions thereof) the principal amount
of any
Indebtedness (other than Funding Indebtedness) of the Company or any Restricted
Subsidiary of the Company, or the acceleration of the final stated maturity
of
any such Indebtedness (which acceleration is not rescinded, annulled or
otherwise cured within 20 days of receipt by the Company or such Restricted
Subsidiary of notice of any such acceleration) if the aggregate principal
amount
of such Indebtedness, together with the principal amount of any other such
Indebtedness in default for failure to pay principal at final maturity or
which
has been accelerated, aggregates $5.0 million or more at any time; (5) one
or more judgments in an aggregate amount in excess of $5.0 million shall
have
been rendered against the Company or any of its Restricted Subsidiaries (other
than a judgment or judgments in respect of Funding Indebtedness where the
judgment creditor (in its capacity as such) does not have rights against
assets
of the Company and its Restricted Subsidiaries other than those assets that
secure such Funding Indebtedness) and such judgments remain undischarged,
unpaid
or unstayed for a period of 60 days after such judgment or judgments become
final and non-appealable (other than any judgments to the extent covered
by an
insurance company that has not contested coverage of such judgment or judgments
in writing); (6) certain events of bankruptcy affecting the Company or any
of
its Significant Subsidiaries; or (7) any Guarantee of a Significant Subsidiary
ceases to be in full force and effect or any Guarantee of a Significant
Subsidiary is declared to be null and void and unenforceable or any Guarantee
of
a Significant Subsidiary is found to be invalid or any Significant Subsidiary
that is a Guarantor denies its liability under its Guarantee (other than
by
reason of release of a Guarantor in accordance with the terms of the
Indenture).
If
an
Event of Default (other than an Event of Default specified in clause (6)
above
with respect to the Company) shall occur and be continuing, the Trustee or
the
Holders of at least 25% in the then outstanding principal amount of the Notes
may declare the principal of and accrued interest on all the then outstanding
Notes to be due and payable by notice in writing to the Company and the Trustee
specifying the respective Event of Default and that it is a “notice of
acceleration” (the “Acceleration
Notice”),
and
the same shall become immediately due and payable. The Holders of a majority
in
the then outstanding principal amount of the Notes may waive any existing
Default or Event of Default under the Indenture, and its consequences, except
a
default in the payment of the principal of or interest on any Notes. Holders
of
the Notes may not enforce the Indenture or the Notes except as provided in
the
Indenture and under the TIA.
Subject
to all provisions of the Indenture and applicable law, the Holders of a majority
in aggregate principal amount of the then outstanding Notes 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.
At
any
time after a declaration of acceleration with respect to the Notes, the Holders
of a majority in the then outstanding principal amount of the Notes may rescind
and cancel such declaration and its consequences: (i) if the rescission
would not conflict with any judgment or decree; (ii) if all existing Events
of Default have been cured or waived except nonpayment of principal or interest
that has become due solely because of the acceleration; (iii) to the extent
the payment of such interest is lawful, interest on overdue installments
of
interest and overdue principal, which has become due otherwise than by such
declaration of acceleration, has been paid; and (iv) if the Company has
paid the Trustee its reasonable compensation and reimbursed the Trustee for
its
expenses, disbursements and advances. No such rescission shall affect any
subsequent Default or impair any right consequent thereto.
Under
the
Indenture, the Company will be required to provide an officers’ certificate to
the Trustee promptly upon any such officer obtaining knowledge of any Default
or
Event of Default (provided
that
such
officers shall provide such certification at least annually whether or not
they
know of any Default or Event of Default) that has occurred and, if applicable,
describe such Default or Event of Default and the status thereof.
|
12.
|
Trustee
Dealings with Company
|
The
Trustee, in its individual or any other capacity, may make loans to, accept
deposits from, and perform services for the Company or its Affiliates, and
may
otherwise deal with the Company or its Affiliates, as if it were not the
Trustee.
|
13.
|
No
Recourse Against
Others
|
No
past,
present or future director, officer, employee, incorporator, agent or
stockholder of the Company or any Guarantor, as such, will have any liability
for obligations of the Company or the Guarantors under the Notes, the Indenture,
the Guarantees, or for any claim based on, in respect of, or by reason of,
such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
|
14.
|
Governing
Law
|
THE
INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE
THIS
NOTE AND THE INDENTURE WITHOUT GIVING EFFECT TO THE APPLICABLE PRINCIPLES
OF
CONFLICTS OF LAWS TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY. EACH OF THE PARTIES HERETO AND THE
HOLDERS AGREE TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF
NEW
YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
NOTE.
15. Authentication
This
Note
shall not be valid until authenticated by the manual signature of the Trustee
or
an authenticating agent.
|
16.
|
Abbreviations
|
Customary
abbreviations may be used in the name of a Holder or an assignee, such as:
TEN
COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN
(=
joint tenants with right of survivorship and not as tenants in common), CUST
(=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
|
17.
|
Additional
Rights of Holders of Restricted Global Notes and Restricted Definitive
Notes
|
In
addition to the rights provided to Holders of Notes under the Indenture,
Holders
of Restricted Global Notes and Restricted Definitive Notes shall have all
the
rights set forth in the applicable Registration Rights Agreement.
|
18.
|
CUSIP
Numbers
|
Pursuant
to a recommendation promulgated by the Committee on Uniform Security
Identification Procedures, the Company have caused CUSIP numbers to be printed
on the Notes and the Trustee may use CUSIP numbers in notices of redemption
as a
convenience to Holders. No representation is made as to the accuracy of such
numbers either as printed on the Notes or as contained in any notice of
redemption and reliance may be placed only on the other identification numbers
placed thereon.
The
Company will furnish to any Holder upon written request and without charge
a
copy of the Indenture and/or any Registration Rights Agreement. Requests
may be
made to:
Saxon
Capital, Inc.
0000
Xxx Xxxx Xxxxx 000
Xxxx
Xxxxx, XX 00000
Attention:
Secretary
19. Subordination
of Certain Guarantees
The
Guarantees of each Servicing Guarantor are subordinated to its Senior
Indebtedness on the terms and subject to the conditions set forth in the
Indenture. To the extent provided in the Indenture, Senior Indebtedness of
a
Servicing Guarantor must be paid before the Guarantee of such Servicing
Guarantor may be paid. The Company agrees, and each Holder by accepting a
Note
agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.
ASSIGNMENT FORM
To
assign
this Note, fill in the form below:
(I)
or
(we) assign and transfer this Note to:
(Insert
assignee’s legal name)
(Insert
assignee’s soc. sec. or tax I.D. no.)
(Print
or
type assignee’s name, address and zip code)
and
irrevocably appoint ________________________________________________ to transfer
this Note on the books of the Company. The agent may substitute another to
act
for him.
Date: Your
Signature:
(Sign
exactly as your name appears
on
the
face of this Note)
Signature
Guarantee*:
|
*
|
Participant
in a recognized Signature Guarantee Medallion Program (or other
signature
guarantor acceptable to the
Trustee).
|
OPTION
OF HOLDER TO ELECT PURCHASE
If
you
want to elect to have this Note purchased by the Company pursuant to
Section 4.11, 4.16 or 4.17 of the Indenture, check the appropriate box
below:
o
Section 4.11
o
Section 4.16
o
Section 4.17
If
you
want to elect to have only part of this Note purchased by the Company pursuant
to Section 4.11, 4.16 or 4.17 of the Indenture, state the amount you elect
to have purchased: $_______________.
Date: Your
Signature:
(Sign
exactly as your name appears
on
the
face of this Note)
Tax
Identification No.:
Signature
Guarantee*:
|
*
|
Participant
in a recognized Signature Guarantee Medallion Program (or other
signature
guarantor acceptable to the
Trustee).
|
CERTIFICATE
TO BE DELIVERED UPON EXCHANGE OR
REGISTRATION
OF TRANSFER RESTRICTED NOTES
Saxon
Capital, Inc.
0000
Xxx
Xxxx, Xxxxx 000
Xxxx
Xxxxx, Xxxxxxxx 00000
Attention:
Chief Financial Officer
Deutsche
Bank Trust Company Americas
00
Xxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attention:
Trust and Securities Services
Re: CUSIP
#
_________________
Reference
is hereby made to the Indenture, dated as of May 4, 2006 (the “Indenture”),
among
Saxon Capital, Inc. (the “Company”
and
the
“Company”),
the
Guarantors, and Deutsche Bank Trust Company Americas, as Trustee. Capitalized
terms used but not defined herein shall have the meanings set forth in the
Indenture.
This
certificate relates to $_________ principal amount of Notes held in (check
applicable space) ____ book-entry or _____ definitive form by the
undersigned.
The
undersigned __________________ (transferor) (check one box below):
|
o
|
hereby
requests the Registrar to deliver in exchange for its beneficial
interest
in the Global Note held by the Depositary a Note or Notes in definitive,
registered form of authorized denominations and an aggregate principal
amount equal to its beneficial interest in such Global Note (or
the
portion thereof indicated above), in accordance with Section 2.06
of the
Indenture;
|
|
o
|
hereby
requests the Trustee to exchange or register the transfer of a
Note or
Notes to _____________
(transferee).
|
In
connection with any transfer of any of the Notes evidenced by this certificate
occurring prior to the expiration of the periods referred to in Rule 144(k)
under the Securities Act of 1933, as amended, the undersigned confirms that
such
Notes are being transferred in accordance with its terms:
CHECK
ONE BOX BELOW:
|
(1)
|
o
|
to
the Company or any of its subsidiaries;
or
|
|
(2)
|
o
|
pursuant
to an effective registration statement under the Securities Act
of 1933,
as amended; or
|
|
(3)
|
o
|
inside
the United States to a “qualified institutional buyer” (as defined in
Rule 144A under the Securities Act of 1933, as amended) that
purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that such transfer
is being
made in reliance on Rule 144A under the Securities Act of 1933, as
amended, in each case pursuant to and in compliance with Rule 144A
thereunder; or
|
|
(4)
|
o
|
outside
the United States in an offshore transaction within the meaning
of
Regulation S under the Securities Act of 1933, as amended, in
compliance with Rule 904 thereunder;
or
|
|
(5)
|
o
|
to
an institutional “accredited investor” (as defined in Rule
501(a)(1),(2),(3) or (7) under the Securities Act of 1933) that
has
furnished to the Trustee a signed letter containing certain
representations and agreements; or
|
|
(6)
|
o
|
in
another transaction that does not require registration under the
Securities Act.
|
Unless
one of the boxes is checked, the Registrar will refuse to register any of
the
Notes evidenced by this certificate in the name of any person other than
the
registered holder thereof.
Signature
Signature
Guarantee:
(Signature
must be guaranteed by a participant in a recognized signature guarantee
medallion program)
TO
BE COMPLETED BY PURCHASER IF (3) 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, as
amended (“Rule 144A”), 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.
[Name
of
Transferee]
|
Dated:
_________________________
|
NOTICE:
To be executed by an executive officer
SCHEDULE
OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE6 Should
be included only in Notes issued in global form.
The
following exchanges of a part of this Global Note for an interest in another
Global Note or for a Definitive Note, or exchanges of a part of another Global
Note or Definitive Note for an interest in this Global Note, have been
made:
|
Date
of
Exchange
|
Amount
of decrease
in
Principal Amount of this Global Note
|
Amount
of increase
in
Principal Amount of this Global Note
|
Principal
Amount of
this
Global Note
following
such
decrease
(or increase)
|
Signature
of authorized officer of Trustee or
Note
Custodian
|
GUARANTEE
For
value
received, the undersigned hereby unconditionally guarantees, to the Holder
of
this Note the cash payments in United States dollars of principal of, premium,
if any, and interest on this Note in the amounts and at the times when due
and
interest on the overdue principal, premium, if any, and interest, if any,
of
this Note, if lawful, and the payment or performance of all other Obligations
of
the Company under the Indenture or this Note, to the Holder of this Note
and the
Trustee, in accordance with the Note, Article X of the Indenture and this
Guarantee, including the terms stated in the Note, the Indenture and this
Guarantee. The validity and enforceability of this Guarantee shall not be
affected by the fact that it is not affixed to any particular Note. Capitalized
terms used but not defined herein shall have the meanings ascribed to them
in
the Indenture dated as of May 4, 2006 among Saxon Capital, Inc., a Maryland
corporation, the undersigned, and Deutsche Bank Trust Company Americas, as
trustee (as amended or supplemented, the “Indenture”).
THIS
GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF
THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES
OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAW OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY. The
undersigned hereby agrees to submit to the jurisdiction of the courts of
the
State of New York in any action or proceeding arising out of or relating
to this
Guarantee.
This
Guarantee is subject to release upon the terms set forth in the
Indenture.
[Guarantor]
By:
Name:
Title:
EXHIBIT
B
[FORM
OF CERTIFICATE TO BE DELIVERED
IN
CONNECTION WITH TRANSFERS PURSUANT TO RULE 144A]
Saxon
Capital, Inc.
0000
Xxx
Xxxx, Xxxxx 000
Xxxx
Xxxxx, Xxxxxxxx 00000
Attention:
Chief Financial Officer
Deutsche
Bank Trust Company Americas
00
Xxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attention:
Corporate Trust Department
|
Re:
|
Saxon
Capital, Inc. (the “Company”)
|
SENIOR
NOTES DUE 2014 (the “Notes”)
Ladies
and Gentlemen:
In
connection with our proposed sale of $________ aggregate principal amount
of the
Notes, we hereby certify that such transfer is being effected pursuant to
and in
accordance with Rule 144A (“Rule 144A”) under the United States Securities
Act of 1933, as amended (the “Securities Act”), and, accordingly, we hereby
further certify that the Notes are being transferred to a person that we
reasonably believe is purchasing the Notes for its own account, or for one
or
more accounts with respect to which such person exercises sole investment
discretion, and such person and each such account is a “qualified institutional
buyer” within the meaning of Rule 144A in a transaction meeting the
requirements of Rule 144A and such Notes are being transferred in
compliance with any applicable blue sky securities laws of any state of the
United States.
You
and
the Company are entitled to rely upon this letter and are irrevocably authorized
to produce this letter or a copy hereof to any interested party in any
administrative or legal proceedings or official inquiry with respect to the
matters covered hereby.
Very
truly yours,
[Name
of
Transferor]
By:
Authorized
Signature
EXHIBIT
C
[FORM
OF CERTIFICATE TO BE DELIVERED
IN
CONNECTION WITH TRANSFERS
PURSUANT
TO REGULATION S]
Saxon
Capital, Inc.
0000
Xxx
Xxxx, Xxxxx 000
Xxxx
Xxxxx, Xxxxxxxx 00000
Attention:
Chief Financial Officer
Deutsche
Bank Trust Company Americas
00
Xxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attention:
Corporate Trust Department
|
Re:
|
Saxon
Capital, Inc. (the “Company”)
|
12%
SENIOR NOTES DUE 2014 (the “Notes”)
Ladies
and Gentlemen:
In
connection with our proposed sale of $________ aggregate principal amount
of the
Notes, we confirm that such sale has been effected pursuant to and in accordance
with Regulation S under the United States Securities Act of 1933, as
amended (the “Securities Act”), and, accordingly, we represent
that:
(1) the
offer
of the Notes was not made to a person in the United States;
(2) either
(a) at the time the buy order was originated, the transferee was outside
the United States or we and any person acting on our behalf reasonably believed
that the transferee was outside the United States or (b) the transaction
was executed in, on or through the facilities of a designated off-shore
securities market and neither we nor any person acting on our behalf knows
that
the transaction has been pre-arranged with a buyer in the United
States;
(3) no
directed selling efforts have been made in the United States in contravention
of
the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable;
(4) the
transaction is being made in compliance with any applicable securities laws
of
any state of the United States or any other applicable jurisdiction;
and
(5) the
transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act and not the result of offers or sales
specifically targeted to an identifiable group of U.S. citizens
abroad.
If
the
transfer of the beneficial interest occurs prior to the expiration of the
40-day
distribution compliance period set forth in Regulation S, the transferred
beneficial interest will be held immediately thereafter through Euroclear
or
Clearstream.
In
addition, if the sale is made during a restricted period and the provisions
of
Rule 903(c)(3) or Rule 904(c)(1) of Regulation S are applicable
thereto, we confirm that such sale has been made in accordance with the
applicable provisions of Rule 903(c)(3) or Rule 904(c)(1), as the case
may be.
The
Company and you are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party
in
any administrative or legal proceedings or official inquiry with respect
to the
matters covered hereby. Terms used in this certificate have the meanings
set
forth in Regulation S.
Very
truly yours,
[Name
of
Transferor]
By:
Authorized
Signature
EXHIBIT
D
FORM
OF CERTIFICATE FROM
ACQUIRING
ACCREDITED INVESTOR
Saxon
Capital, Inc.
0000
Xxx
Xxxx, Xxxxx 000
Xxxx
Xxxxx, Xxxxxxxx 00000
Deutsche
Bank Trust Company Americas
00
Xxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attention:
Corporate Trust Department
|
Re:
|
12%
Senior Notes due 2004
|
Reference
is hereby made to the Indenture, dated as of May 4, 2006 (the “Indenture”),
among
Saxon Capital, Inc. (the “Company”
and
the
“Company”),
the
Guarantors, and Deutsche Bank Trust Company Americas, as trustee. Capitalized
terms used but not defined herein shall have the meanings given to them in
the
Indenture.
In
connection with our proposed purchase of $____________ aggregate principal
amount of:
(i)o
a
beneficial interest in a Global Note, or
(ii)o
a
Definitive Note,
we
confirm that:
1. We
understand that any subsequent transfer of the Notes or any interest therein
is
subject to certain restrictions and conditions set forth in the Indenture,
and
the undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Notes or any interest therein except in compliance with, such
restrictions and conditions and the United States Securities Act of 1933,
as
amended (the “Securities
Act”).
2. We
understand that the offer and sale of the Notes have not been registered
under
the Securities Act, and that the Notes and any interest therein may not be
offered or sold except as permitted in the following sentence. We agree,
on our
own behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell the Notes or any interest therein, we will
do so
only (a) to the Company (b) so long as the Notes are eligible for resale
pursuant to Rule 144A under the Securities Act to a person whom we
reasonably believe is a qualified institutional buyer within the meaning
of Rule
144A purchasing for its own account or for the account of a qualified
institutional buyer, in each case, to whom notice is given that the offer,
resale, pledge or other transfer is being made in reliance on Rule 144A,
(c) to non-U.S. persons in offshore transactions in accordance with
Rule 904 of Regulation S under the Securities Act,
(d) after
the later of the second anniversary of the issuance of the relevant Notes
or the
date that is three months after the Transferor has ceased to be an affiliate
of
the Company, (e) pursuant to an effective registration statement under the
Securities Act or (f) in any other transaction that does not require
registration under the Securities Act, and we further agree to provide to
any
person purchasing the Definitive Note or beneficial interest in a Global
Note
from us in a transaction meeting the requirements of any of clauses (a)
through (f) of this paragraph a notice advising such purchaser that resales
thereof are restricted as stated herein.
3. We
understand that, on any proposed resale of the Notes or beneficial interest
therein, we will be required to furnish to you and the Company such
certifications, legal opinions and other information as you and the Company
may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will bear
a
legend to the foregoing effect.
4. We
are an
institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3)
or (7) of Regulation D under the Securities Act) and have such knowledge
and experience in financial and business matters as to be capable of evaluating
the merits and risks of our investment in the Notes, and we and any accounts
for
which we are acting are each able to bear the economic risk of our or its
investment.
5. We
are
acquiring the Notes or beneficial interest therein purchased by us for our
own
account or for one or more accounts (each of which is an institutional
“accredited investor”) as to each of which we exercise sole investment
discretion.
You
and
the Company are entitled to rely upon this letter and are irrevocably authorized
to produce this letter or a copy to any interested party in any administrative
or legal proceedings or official inquiry with respect to the matters covered
hereby.
[Insert
Name of Transferor]
By:
Name:
Title:
Dated:
___________________________
