EXHIBIT 4.2
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KANEB PIPE LINE OPERATING PARTNERSHIP, L.P.
ISSUER
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TRUSTEE
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INDENTURE
DATED AS OF ______________ ____, ______
SUBORDINATED DEBT SECURITIES
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Subordinated Indenture
Reconciliation and Tie between
Trust Indenture Act of 1939 and Indenture
Trust Indenture
TIA SECTION INDENTURE SECTION
Section 310 (a)(1)..................................................................7.10
(a)(2)..................................................................7.10
(a)(3)..................................................................N/A
(a)(4)..................................................................N/A
(a)(5)..................................................................7.10
(b).....................................................................7.03; 7.10
(c).....................................................................N.A.
Section 311 (a).....................................................................7.11
(b).....................................................................7.11
(c).....................................................................N.A.
Section 312 (a).....................................................................5.01
(b).....................................................................5.02
(c).....................................................................5.02
Section 313 (a).....................................................................5.04
(b).....................................................................5.04
(c).....................................................................1.07
(d).....................................................................5.04
Section 314 (a)(1)..................................................................5.03
(a)(2)..................................................................5.03
(a)(3)..................................................................5.03
(a)(4)..................................................................4.05
(b).....................................................................N.A.
(c)(1)..................................................................1.09
(c)(2)..................................................................1.09
(c)(3)..................................................................N.A.
(d).....................................................................N.A.
(e).....................................................................1.09
(f).....................................................................N.A.
Section 315 (a).....................................................................7.01
(b).....................................................................6.07; 1.07
(c).....................................................................7.01
(d).....................................................................7.01
(e).....................................................................6.08
Section 316 (a)(last sentence)......................................................1.01
(a)(1)(A)...............................................................6.06
(a)(1)(B)...............................................................6.06
(a)(2)..................................................................9.01(f)
(b).....................................................................6.04
(c).....................................................................5.05
Section 317 (a)(1)..................................................................6.02
(a)(2)..................................................................6.02
(b).....................................................................4.04
Section 318 (a).....................................................................1.11
(b).....................................................................N/A
(c).....................................................................1.03; 1.11
NOTE: This Reconciliation and Tie shall not, for any purpose, be deemed to be a
part of this Indenture.
Subordinated Indenture
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION......................1
SECTION 1.01. Certain Terms Defined...............................................1
SECTION 1.02. Other Definitions...................................................8
SECTION 1.03. Incorporation by Reference of Trust Indenture Act...................8
SECTION 1.04. Rules of Construction...............................................8
SECTION 1.05. Successors and Assigns of the Partnership Bound by this Indenture...9
SECTION 1.06. Acts of Board, Committee or Officer of Successor Company Valid......9
SECTION 1.07. Required Notices or Demands.........................................9
SECTION 1.08. Indenture and Debt Securities to Be Construed in
Accordance with the Laws of the State of New York..................10
SECTION 1.09. Officers' Certificate and Opinion of Counsel to Be
Furnished upon Application or Demand by the Partnership............10
SECTION 1.10. Payments Due on Legal Holidays.....................................10
SECTION 1.11. Provisions Required by Trust Indenture Act to Control..............11
SECTION 1.12. Computation of Interest on Debt Securities.........................11
SECTION 1.13. Rules by Trustee, Paying Agent and Registrar.......................11
SECTION 1.14. No Recourse Against Others.........................................11
SECTION 1.15. Severability.......................................................11
SECTION 1.16. Effect of Headings.................................................11
SECTION 1.17. Indenture May Be Executed in Counterparts..........................11
ARTICLE 2 DEBT SECURITIES.............................................................11
SECTION 2.01. Forms Generally....................................................11
SECTION 2.02. Form of Trustee's Certificate of Authentication....................12
SECTION 2.03. Principal Amount; Issuable in Series...............................12
SECTION 2.04. Execution of Debt Securities.......................................15
SECTION 2.05. Authentication and Delivery of Debt Securities.....................15
SECTION 2.06. Denomination of Debt Securities....................................16
SECTION 2.07. General Provisions for Registration of Transfer and Exchange.......17
SECTION 2.08. Temporary Debt Securities..........................................18
SECTION 2.09. Mutilated, Destroyed, Lost or Stolen Debt Securities...............18
SECTION 2.10. Cancellation of Surrendered Debt Securities........................19
SECTION 2.11. Provisions of this Indenture and Debt Securities for the
Sole Benefit of the Parties and the Holders........................19
SECTION 2.12. Payment of Interest; Rights Preserved..............................19
SECTION 2.13. Securities Denominated in Foreign Currencies.......................20
SECTION 2.14. Wire Transfers.....................................................20
SECTION 2.15. Securities Issuable in the Form of a Global Security...............20
SECTION 2.16. Medium Term Securities.............................................23
SECTION 2.17. Defaulted Interest.................................................23
SECTION 2.18. Judgments..........................................................24
SECTION 2.19. CUSIP Numbers......................................................24
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Subordinated Indenture
TABLE OF CONTENTS
(continued)
Page
ARTICLE 3 REDEMPTION OF DEBT SECURITIES...............................................25
SECTION 3.01. Applicability of Article...........................................25
SECTION 3.02. Notice of Redemption; Selection of Debt Securities.................25
SECTION 3.03. Payment of Debt Securities Called for Redemption...................26
SECTION 3.04. Mandatory and Optional Sinking Funds...............................27
SECTION 3.05. Redemption of Debt Securities for Sinking Fund.....................27
ARTICLE 4 PARTICULAR COVENANTS OF THE PARTNERSHIP.....................................29
SECTION 4.01. Payment of Principal of, and Premium, if any, and
Interest on, Debt Securities.......................................29
SECTION 4.02. Maintenance of Offices or Agencies for Registration of Transfer,
Exchange and Payment of Debt Securities............................29
SECTION 4.03. Appointment to Fill a Vacancy in the Office of Trustee.............30
SECTION 4.04. Duties of Paying Agents, etc. .....................................30
SECTION 4.05. Statement by Officers as to Default................................31
SECTION 4.06. Further Instruments and Acts.......................................31
SECTION 4.07. Corporate, Partnership or Limited Liability Company Existence......31
SECTION 4.08. Maintenance of Properties..........................................31
SECTION 4.09. Payment of Taxes and Other Claims..................................32
SECTION 4.10. Calculation of Original Issue Discount.............................32
SECTION 4.11. Stay, Extension and Usury Laws.....................................32
ARTICLE 5 HOLDERS' LISTS AND REPORTS BY THE PARTNERSHIP AND THE TRUSTEE...............32
SECTION 5.01. The Partnership to Furnish the Trustee Information as to
Names and Addresses of Holders; Preservation of Information........32
SECTION 5.02. Communications to Holders; Meetings of Holders.....................33
SECTION 5.03. Reports by the Partnership.........................................34
SECTION 5.04. Reports by the Trustee.............................................34
SECTION 5.05. Record Dates for Action by Holders.................................34
ARTICLE 6 REMEDIES OF THE TRUSTEE AND HOLDERS IN EVENT OF DEFAULT.....................35
SECTION 6.01. Events of Default..................................................35
SECTION 6.02. Collection of Indebtedness by Trustee, etc. .......................36
SECTION 6.03. Application of Moneys Collected by Trustee.........................37
SECTION 6.04. Limitation on Suits by Holders.....................................38
SECTION 6.05. Remedies Cumulative; Delay or Omission in Exercise of
Rights Not a Waiver of Default.....................................39
SECTION 6.06. Rights of Holders of Majority in Principal Amount of
Debt Securities to Direct Trustee and to Waive Default.............39
SECTION 6.07. Trustee to Give Notice of Defaults Known to It, but May
Withhold Such Notice in Certain Circumstances......................40
SECTION 6.08. Requirement of an Undertaking To Pay Costs in Certain
Suits under this Indenture or Against the Trustee..................40
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Subordinated Indenture
TABLE OF CONTENTS
(continued)
Page
ARTICLE 7 CONCERNING THE TRUSTEE......................................................40
SECTION 7.01. Certain Duties and Responsibilities................................40
SECTION 7.02. Certain Rights of Trustee..........................................41
SECTION 7.03. Trustee Not Liable for Recitals in Indenture or in Debt
Securities.........................................................43
SECTION 7.04. Trustee, Paying Agent or Registrar May Own Debt Securities.........43
SECTION 7.05. Moneys Received by Trustee to Be Held in Trust.....................43
SECTION 7.06. Compensation and Reimbursement.....................................43
SECTION 7.07. Right of Trustee to Rely on an Officers' Certificate
Where No Other Evidence Specifically Prescribed....................44
SECTION 7.08. Separate Trustee; Replacement of Trustee...........................44
SECTION 7.09. Successor Trustee by Merger........................................45
SECTION 7.10. Eligibility; Disqualification......................................46
SECTION 7.11. Preferential Collection of Claims Against the Partnership..........46
SECTION 7.12. Compliance with Tax Laws...........................................46
SECTION 7.13. Trustee's Application for Instructions from the Partnership........46
ARTICLE 8 CONCERNING THE HOLDERS......................................................47
SECTION 8.01. Evidence of Action by Holders......................................47
SECTION 8.02. Proof of Execution of Instruments and of Holding of
Debt Securities....................................................47
SECTION 8.03. Who May Be Deemed Owner of Debt Securities.........................47
SECTION 8.04. Instruments Executed by Holders Bind Future Holders................47
ARTICLE 9 SUPPLEMENTAL INDENTURES.....................................................48
SECTION 9.01. Purposes for Which Supplemental Indenture May Be
Entered into Without Consent of Holders............................48
SECTION 9.02. Modification of Indenture with Consent of Holders of
Debt Securities....................................................50
SECTION 9.03. Effect of Supplemental Indentures..................................51
SECTION 9.04. Debt Securities May Bear Notation of Changes by
Supplemental Indentures............................................51
ARTICLE 10 CONSOLIDATION, MERGER, SALE OR CONVEYANCE...................................51
SECTION 10.01. Consolidations and Mergers of the Partnership......................51
SECTION 10.02. Rights and Duties of Successor Company.............................52
ARTICLE 11 SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS; DEFEASANCE.......52
SECTION 11.01. Applicability of Article...........................................52
SECTION 11.02. Satisfaction and Discharge of Indenture; Defeasance................53
SECTION 11.03. Conditions of Defeasance...........................................53
SECTION 11.04. Application of Trust Money.........................................55
SECTION 11.05. Repayment to the Partnership.......................................55
SECTION 11.06. Indemnity for U.S. Government Obligations..........................55
SECTION 11.07. Reinstatement......................................................55
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Subordinated Indenture
TABLE OF CONTENTS
(continued)
Page
ARTICLE 12 SUBORDINATION OF DEBT SECURITIES............................................55
SECTION 12.01. Applicability of Article; Agreement to Subordinate.................55
SECTION 12.02. Liquidation, Dissolution, Bankruptcy...............................56
SECTION 12.03. Default of Senior Indebtedness.....................................56
SECTION 12.04. Acceleration of Payment of Debt Securities.........................57
SECTION 12.05. When Distribution Must Be Paid Over................................57
SECTION 12.06. Subrogation........................................................57
SECTION 12.07. Relative Rights....................................................58
SECTION 12.08. Subordination May Not Be Impaired by Partnership...................58
SECTION 12.09. Rights of Trustee and Paying Agent.................................58
SECTION 12.10. Distribution or Notice to Representative...........................58
SECTION 12.11. Article 12 Not to Prevent Defaults or Limit Right to Accelerate....59
SECTION 12.12. Trust Moneys Not Subordinated......................................59
SECTION 12.13. Trustee Entitled to Rely...........................................59
SECTION 12.14. Trustee to Effectuate Subordination................................59
SECTION 12.15. Trustee Not Fiduciary for Holders of Senior Indebtedness...........60
SECTION 12.16. Reliance by Holders of Senior Indebtedness on Subordination
Provisions.........................................................60
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Subordinated Indenture
INDENTURE dated as of ______________ ___, _____, among KANEB PIPE LINE
OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the "PARTNERSHIP"),
and ___________________________________________, a __________________________
(the "TRUSTEE").
WITNESSETH:
WHEREAS, Kaneb Pipe Line Company, LLC, a Delaware limited liability
company (the "GENERAL PARTNER"), as the general partner of the Partnership, has
duly authorized the execution and delivery of this Indenture to provide for the
issuance from time to time of its debentures, notes, bonds or other evidences of
indebtedness to be issued in one or more series in an unlimited aggregate
principal amount (herein called the "DEBT SECURITIES"), as in this Indenture
provided; and
WHEREAS, all things necessary to make this Indenture a valid agreement
of the Partnership, in accordance with its terms, have been done;
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for good and valuable consideration, the sufficiency of which
is hereby acknowledged, the Partnership and the Trustee hereby agree with each
other, for the equal and proportionate benefit of the respective Holders from
time to time of the Debt Securities or any series thereof, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. CERTAIN TERMS DEFINED.
The terms defined in this Section 1.01 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes of
this Indenture and of any Indenture supplemental hereto shall have the
respective meanings specified in this Section 1.01. All other terms used in this
Indenture which are defined in the Trust Indenture Act or which are by reference
therein defined in the Securities Act (except as herein otherwise expressly
provided or unless the context otherwise requires), shall have the meanings
assigned to such terms in the Trust Indenture Act and in the Securities Act as
in force as of the date of original execution of this Indenture.
"BANKRUPTCY LAW" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"BOARD OF DIRECTORS" means the board of directors of the General
Partner, or with respect to any determination or resolution required or
permitted to be made hereunder, any duly authorized committee or subcommittee of
such board or any directors or officers of the General Partner to whom such
board of directors or such committee or subcommittee shall have delegated its
authority to act hereunder. If the Partnership changes its form of entity to
other than as limited partnership, the references to the board of directors of
the General Partner shall mean the board of directors (or other comparable
governing body) of the Partnership.
"BOARD RESOLUTION" means a copy of a resolution certified by the
appropriate person to have been duly adopted by the Board of Directors and to be
in full force and effect on the date of such certification.
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Subordinated Indenture
"BUSINESS DAY" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in the Borough of
Manhattan, the City of
New York,
New York, or the city in which the Corporate
Trust Office of the Trustee is located, are authorized or obligated by law or
executive order to close.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time and any successor statute.
"COMMISSION" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, or, if at any time after
the execution of this Indenture such Commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"CORPORATE TRUST OFFICE OF THE TRUSTEE" means the principal corporate
trust office of the Trustee, at which at any particular time its corporate trust
business shall be administered, which office at the date of execution of this
Indenture is located at _________________________, Attention: ________________.
"CURRENCY" means Dollars or Foreign Currency.
"DEBT" of any Person at any date means any obligation created or
assumed by such Person for the repayment of borrowed money and any guarantee
therefor.
"DEBT SECURITY" or "DEBT SECURITIES" has the meaning stated in the
first recital of this Indenture and more particularly means any debt security or
debt securities, as the case may be, of any series authenticated and delivered
under this Indenture.
"DEFAULT" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"DEPOSITARY" means, unless otherwise specified by the Partnership
pursuant to either Section 2.03 or 2.15, with respect to registered Debt
Securities of any series issuable or issued in whole or in part in the form of
one or more Global Securities, The Depository Trust Company,
New York,
New York,
or any successor thereto registered as a clearing agency under the Exchange Act
or other applicable statute or regulations.
"DESIGNATED SENIOR INDEBTEDNESS" means (i) any Senior Indebtedness of
the Partnership which, at the date of determination, has an aggregate principal
amount outstanding of, or under which, at the date of determination, the holders
thereof are committed to lend up to, at least $100 million and (ii) any other
Senior Indebtedness designated, as provided in Section 2.03, in respect of any
series of Debt Securities.
"DOLLAR" or "$" means such currency of the United States as at the time
of payment is legal tender for the payment of public and private debts.
"DOLLAR EQUIVALENT" means, with respect to any monetary amount in a
Foreign Currency, at any time for the determination thereof, the amount of
Dollars obtained by converting such Foreign Currency involved in such
computation into Dollars at the spot rate for the purchase of Dollars with the
applicable Foreign Currency as quoted by Citibank, N.A. (unless another
comparable financial institution is designated by the Partnership) in
New York,
New York at
2
Subordinated Indenture
approximately 11:00 a.m. (
New York time) on the date two business days prior to
such determination.
"EQUITY INTERESTS" means:
(i) in the case of a corporation, corporate stock;
(ii) in the case of an association or a business entity, any
and all shares, interests, participations, rights or other equivalents
(however designated) of corporate stock;
(iii) in the case of a partnership or limited liability
company, partnership or membership interests (whether general or
limited);
(iv) any other interest or participation (howsoever
designated) that confers on a Person the right to receive a share of
the profits and losses of, or distributions of assets of, the issuing
Person; and
(v) all warrants, options or other rights to acquire any of
the interests described in clauses (i) through (iv) above (but
excluding any debt security that is convertible into, or exchangeable
for, any of the interests described in clauses (i) through (iv) above).
"EVENT OF DEFAULT" has the meaning specified in Section 6.01.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
or any successor statute.
"FLOATING RATE SECURITY" means a Debt Security that provides for the
payment of interest at a variable rate determined periodically by reference to
an interest rate index specified pursuant to Section 2.03.
"FOREIGN CURRENCY" means a currency issued or adopted by the government
of any country other than the United States or a composite currency the value of
which is determined by reference to the values of the currencies of any group of
countries.
"GAAP" means United States 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 have been approved by a significant segment
of the accounting profession, which are in effect from time to time.
"GENERAL PARTNER" means Kaneb Pipe Line Company, LLC, a Delaware
limited liability company, and its successors and permitted assigns as general
partner of the Partnership.
"GLOBAL SECURITY" means with respect to any series of Debt Securities
issued hereunder, a Debt Security that is executed by the Partnership and
authenticated and delivered by the Trustee to the Depositary or pursuant to the
Depositary's instruction, all in accordance with this Indenture and any
Indentures supplemental hereto, or the applicable Board Resolution and set forth
in an Officers' Certificate, which shall be registered in the name of the
Depositary or its nominee and which shall represent, and shall be denominated in
an amount equal to the aggregate principal
3
Subordinated Indenture
amount of, all the Outstanding Debt Securities of such series or any portion
thereof, in either case having the same terms, including, without limitation,
the same original issue date, date or dates on which principal is due and
interest rate or method of determining interest.
"HOLDER," "HOLDER OF DEBT SECURITIES" or other similar terms mean, with
respect to a Registered Security, the Registered Holder.
"INDENTURE" means this instrument as originally executed, or, if
amended or supplemented as herein provided, as so amended or supplemented, and
shall include the form and terms of particular series of Debt Securities as
contemplated hereunder, whether or not a supplemental Indenture is entered into
with respect thereto.
"ISSUER ORDER" means a written order of the Partnership, signed by the
Chairman of the Board, President or any Vice President of the General Partner
and by the Treasurer, Secretary, any Assistant Treasurer or any Assistant
Secretary of the General Partner.
"LIEN" means, with respect to any asset, any mortgage, lien (statutory
or otherwise), pledge, charge, security interest, hypothecation, assignment for
security, claim, preference, priority or encumbrance of any kind in respect of
such asset, whether or not filed, recorded or otherwise perfected under
applicable law, including any conditional sale or other title retention
agreement or any lease in the nature thereof, any option or other agreement to
grant a security interest in and any filing of or agreement to give any
financing statement under the Uniform Commercial Code (or equivalent statute) of
any jurisdiction, other than a precautionary financing statement respecting a
Lien not intended as a security agreement.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board of Directors, President or any vice President of the General Partner
and by the Treasurer, Secretary, any Assistant Treasurer or any Assistant
Secretary of the General Partner. Each such certificate shall include the
statements provided for in Section 1.09, if applicable.
"OPINION OF COUNSEL" means an opinion in writing signed by legal
counsel for the Partnership (which counsel may be an employee of the Partnership
or outside counsel for the Partnership). Each such opinion shall include the
statements provided for in Section 1.09, if applicable.
"ORIGINAL ISSUE DISCOUNT DEBT SECURITY" means any Debt Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration or acceleration of the maturity thereof pursuant to
Section 6.01.
"OUTSTANDING" when used with respect to any series of Debt Securities,
means, as of the date of determination, all Debt Securities of that series
theretofore authenticated and delivered under this Indenture, except:
(i) Debt Securities of that series theretofore canceled by the
Trustee or delivered to the Trustee for cancellation;
(ii) Debt Securities of that series for whose payment or
redemption money in the necessary amount has been theretofore deposited
with the Trustee or any paying agent (other than the Partnership) in
trust or set aside and segregated in trust by the Partnership (if the
Partnership shall act as its own paying agent) for the holders of such
Debt Securities; provided, that, if such Debt Securities are to be
redeemed, notice of such
4
Subordinated Indenture
redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been made; and
(iii) Debt Securities of that series which have been paid
pursuant to Section 2.09 or in exchange for or in lieu of which other
Debt Securities have been authenticated and delivered pursuant to this
Indenture, other than any such Debt Securities in respect of which
there shall have been presented to the Trustee proof satisfactory to it
that such Debt Securities are held by a bona fide purchaser in whose
hands such Debt Securities are valid obligations of the Partnership;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Debt Securities of any series have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Debt Securities owned by the Partnership or any other obligor upon the Debt
Securities or any Subsidiary of the Partnership or of such other obligor shall
be disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Debt Securities which
a Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded. Debt Securities so owned which have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Debt Securities and
that the pledgee is not the Partnership or any other obligor upon the Debt
Securities or a Subsidiary of the Partnership or of such other obligor. In
determining whether the Holders of the requisite principal amount of outstanding
Debt Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, the principal amount of an Original Issue
Discount Debt Security that shall be deemed to be Outstanding for such purposes
shall be the amount of the principal thereof that would be due and payable as of
the date of such determination upon a declaration of acceleration of the
maturity thereof pursuant to Section 6.01. In determining whether the Holders of
the requisite principal amount of the Outstanding Debt Securities of any series
have given any request, demand, authorization, direction, notice, consent or
waiver hereunder, the principal amount of a Debt Security denominated in one or
more Foreign Currencies or currency units that shall be deemed to be Outstanding
for such purposes shall be the Dollar Equivalent, determined in the manner
provided as contemplated by Section 2.03 on the date of original issuance of
such Debt Security, of the principal amount (or, in the case of any Original
Issue Discount Security, the Dollar Equivalent on the date of original issuance
of such Security of the amount determined as provided in the preceding sentence
above) of such Debt Security.
"PARENT PARTNERSHIP" means Kaneb Pipe Line Partners, L.P., a Delaware
limited partnership, and its successors and assigns.
"PARTNERSHIP" means Kaneb Pipe Line Operating Partnership, L.P., a
Delaware limited partnership, and, subject to the provisions of Article 10,
shall also include its successors and assigns.
"PERSON" means any individual, corporation, partnership, joint venture,
association, limited liability company, joint stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"PLACE OF PAYMENT" means, when used with respect to the Debt Securities
of any series, the place or places where the principal of, and premium, if any,
and interest on, the Debt Securities of that series are payable as specified
pursuant to Section 2.03.
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Subordinated Indenture
"REGISTERED HOLDER" means the Person in whose name a Registered
Security is registered in the Debt Security Register (as defined in Section
2.07(a)).
"REGISTERED SECURITY" means any Debt Security registered as to
principal and interest in the Debt Security Register (as defined in Section
2.07(a)).
"REGISTRAR" has the meaning set forth in Section 2.07(a).
"REPRESENTATIVE" means the trustee, agent or representative (if any)
for an issue of Senior Indebtedness.
"RESPONSIBLE OFFICER" when used with respect to the Trustee, means any
officer within the Corporate Trust Office of the Trustee or any other officer of
the Trustee performing functions similar to those performed by the persons who
at the time shall be such officers, and any other officer of the Trustee to whom
corporate trust matters are referred because of his knowledge of and familiarity
with the particular subject.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
successor statute.
"SENIOR INDEBTEDNESS" means, unless otherwise provided with respect to
the Debt Securities of a series as contemplated by Section 2.03, (i) all Debt of
the Partnership or its Subsidiaries, whether currently outstanding or hereafter
issued, unless, by the terms of the instrument creating or evidencing such Debt,
it is provided that such Debt is not superior in right of payment to the Debt
Securities, in the case of the Partnership, or any guarantee of any Debt
Security by any Subsidiary of the Partnership, in the case of a Subsidiary of
the Partnership, or to other Debt which is pari passu with or subordinated to
the Debt Securities, in the case of the Partnership, or any guarantee of any
Debt Security by any Subsidiary of the Partnership, in the case of a Subsidiary
of the Partnership, and (ii) any modifications, refunding, deferrals, renewals
or extensions of any such Debt or securities, notes or other evidence of Debt
issued in exchange for such Debt; provided that in no event shall "Senior
Indebtedness" include (a) Debt evidenced by the Debt Securities or any guarantee
of any Debt Security by any Subsidiary of the Partnership, (b) Debt of any of
the Partnership or any Subsidiary of the Partnership which has guaranteed any
Debt Security, in each case owed or owing to any Subsidiary of the Partnership,
(c) Debt of any Subsidiary of the Partnership which has guaranteed any Debt
Security owed or owing to the Partnership, (d) Debt owed or owing to trade
creditors, (e) any liability for taxes owed or owing by the Partnership or any
Subsidiary of the Partnership which has guaranteed any Debt Security or (f) Debt
of any Subsidiary of the Partnership which has guaranteed any Debt Security in
the event there is no series of Debt Securities Outstanding that is entitled to
the benefits of such guarantee.
"STATED MATURITY" means, at any time, with respect to any installment
of interest or principal on any series of Debt Securities, the date on which
such payment of interest or principal was scheduled to be paid in the original
documentation governing such indebtedness or such later date as such
documentation shall provide at that time, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.
"SUBSIDIARY" means, with respect to any Person:
(i) any corporation, association or other business entity of
which more than 50% of the Voting Stock is at the time owned or
controlled, directly or indirectly, by such
6
Subordinated Indenture
Person or one or more of the other Subsidiaries of that Person (or a
combination thereof); and
(ii) any partnership (whether general or limited) or limited
liability company (a) the sole general partner or the managing general
partner or managing member of which is such Person or a Subsidiary of
such Person, or (b) if there are more than a single general partner or
member, either (y) the only general partners or managing members of
which are such Person and/or one or more Subsidiaries of such Person
(or any combination thereof) or (z) such Person owns or controls,
directly or indirectly, a majority of the outstanding general partner
interests, member interests or other Voting Stock of such partnership,
limited liability company or joint venture, respectively.
"TRUST INDENTURE ACT" (except as herein otherwise expressly provided)
means the Trust Indenture Act of 1939 as in force at the date of this Indenture
as originally executed and, to the extent required by law, as amended, or any
successor statute.
"TRUSTEE" initially means First Union National Bank and any other
Person or Persons appointed as such from time to time pursuant to Section 7.08,
and, subject to the provisions of Article VII, includes its or their successors
and assigns. If at any time there is more than one such Person, "Trustee" as
used with respect to the Debt Securities of any series shall mean the Trustee
with respect to the Debt Securities of that series.
"UNITED STATES" means the United States of America (including the
States and the District of Columbia), its territories, its possessions and other
areas subject to its jurisdiction.
"U.S. GOVERNMENT OBLIGATIONS" means securities that are (i) direct
obligations of the United States for the payment of which its full faith and
credit is pledged; (ii) obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States, the payment of
which is unconditionally guaranteed as a full faith and credit obligation by the
United States, which, in either case, under clause (i) or (ii) above, are not
callable or redeemable at the option of the issuers thereof; or (iii) depository
receipts issued by a bank or trust company as custodian with respect to any such
U.S. Government Obligations or a specific payment of interest on or principal of
any such U.S. Government Obligation held by such custodian for the account of
the holder of a depository receipt, provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation evidenced by such
depository receipt.
"VOTING STOCK" of any Person as of any date means the Equity Interests
of such Person pursuant to which the holders thereof have the general voting
power under ordinary circumstances to elect at least a majority of the board of
directors, managers, general partners or trustees of any Person (regardless of
whether, at the time, Equity Interests of any other class or classes shall have,
or might have, voting power by reason of the occurrence of any contingency) or,
with respect to a partnership (whether general or limited), any general partner
interest in such partnership.
"YIELD TO MATURITY" means the yield to maturity calculated at the time
of issuance of a series of Debt Securities, or, if applicable, at the most
recent redetermination of interest on such series and calculated in accordance
with accepted financial practice.
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Subordinated Indenture
SECTION 1.02. OTHER DEFINITIONS.
Term Section in which Defined
---- ------------------------
"DEFAULTED INTEREST" 2.17
"DESIGNATED CURRENCY" 2.18
"MANDATORY SINKING FUND PAYMENT" 3.04
"OPTIONAL SINKING FUND PAYMENT" 3.04
"SUBORDINATED DEBT SECURITIES 12.01
"SUCCESSOR COMPANY" 10.01
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
This Indenture is subject to the mandatory provisions of the Trust
Indenture Act which are incorporated by reference in and made a part of this
Indenture. The following Trust Indenture Act terms have the following meanings:
"INDENTURE SECURITIES" means the Debt Securities.
"INDENTURE SECURITY HOLDER" means a Holder.
"INDENTURE TO BE QUALIFIED" means this Indenture.
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee.
"OBLIGOR" on this Indenture securities means the Partnership and any
other obligor on the Debt Securities.
All other Trust Indenture Act terms used in this Indenture that are
defined by the Trust Indenture Act, reference to another statute or defined by
rules of the Securities and Exchange Commission have the meanings assigned to
them by such definitions.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) "including"(in all of its forms) means including without
limitation;
(v) words in the singular include the plural and words in the
plural include the singular;
(vi) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to
any particular Article, Section or other subdivision;
8
Subordinated Indenture
(vii) unless the contract otherwise requires, any references
to an Article or a Section refers to an Article or a Section,
respectively, of this Indenture;
(viii) any gender used in this Indenture shall be deemed to
include the neuter, masculine or feminine genders;
(ix) if the applicable series of Debt Securities are
subordinated pursuant to Article 12, unsecured Debt shall not be deemed
to be subordinate or junior to secured Debt merely by virtue of its
nature as unsecured Debt; and
(ix) when used with references to the Debt Securities, the
expression "of like tenor" refers to Debt Securities of the same
series.
SECTION 1.05. SUCCESSORS AND ASSIGNS OF THE PARTNERSHIP BOUND BY THIS
INDENTURE.
All the covenants, stipulations, promises and agreements in this
Indenture contained by or in behalf of the Partnership or the Trustee shall bind
its successors and assigns, whether so expressed or not.
SECTION 1.06. ACTS OF BOARD, COMMITTEE OR OFFICER OF SUCCESSOR COMPANY
VALID.
Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any Board Resolution, committee thereof or
officer of the General Partner, as applicable, shall and may be done and
performed with like force and effect by the like Board of Directors, committee
thereof or officer of any Successor Company.
SECTION 1.07. REQUIRED NOTICES OR DEMANDS.
Except as otherwise expressly provided in this Indenture, any notice or
demand which by any provision of this Indenture is required or permitted to be
given or served by the Trustee or by the Holders to or on the Partnership may be
given or served by being deposited postage prepaid in a post office letter box
in the United States addressed (until another address is filed by the
Partnership with the Trustee) as follows: Kaneb Pipe Line Operating Partnership,
L.P., 0000 Xxxxx Xxxxxxx Xxxxxxxxxx, Xxxxxxxxxx, Xxxxx 00000, Attention:
____________________. Except as otherwise expressly provided in this Indenture,
any notice, direction, request or demand by the Partnership or by any Holder to
or upon the Trustee may be given or made, for all purposes, by being deposited,
postage prepaid, in a post office letter box in the United States addressed to
the Corporate Trust Office of the Trustee initially at
________________________________________, Attention: [Corporate Trust
Administration]. The Partnership or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice required or permitted to a Registered Holder by the
Partnership or the Trustee pursuant to the provisions of this Indenture shall be
deemed to be properly mailed by being deposited postage prepaid in a post office
letter box in the United States addressed to such Holder at the address of such
Holder as shown on the Debt Security Register. Any report pursuant to Section
313 of the Trust Indenture Act shall be transmitted in compliance with
subsection (c) therein. Notwithstanding the foregoing, any notice to Holders of
Floating Rate Securities regarding the determination of a periodic rate of
interest, if such notice is required pursuant to Section 2.03, shall be
sufficiently given in the manner specified pursuant to Section 2.03.
9
Subordinated Indenture
In the event of suspension of regular mail service or by reason of any
other cause it shall be impracticable to give notice by mail, then such
notification as shall be given with the approval of the Trustee shall constitute
sufficient notice for every purpose hereunder.
Failure to mail a notice or communication to a Holder or any defect in
it or any defect in any notice by publication as to a Holder shall not affect
the sufficiency of such notice with respect to other Holders. If a notice or
communication is mailed or published in the manner provided above, it is
conclusively presumed duly given.
SECTION 1.08. INDENTURE AND DEBT SECURITIES TO BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.
This Indenture and each Debt Security shall be deemed to be
New York
contracts, and for all purposes shall be construed in accordance with the laws
of said State (without reference to principles of conflicts of law).
SECTION 1.09. OFFICERS' CERTIFICATE AND OPINION OF COUNSEL TO BE
FURNISHED UPON APPLICATION OR DEMAND BY THE PARTNERSHIP.
Upon any application or demand by the Partnership to the Trustee to
take any action under any of the provisions of this Indenture, the Partnership
shall furnish to the Trustee an Officers' Certificate stating that all
conditions precedent provided for in this Indenture relating to the proposed
action have been complied with and an Opinion of Counsel stating that, in the
opinion of such counsel, all such conditions precedent have been complied with,
except that in the case of any such application or demand as to which the
furnishing of such document is specifically required by any provision of this
Indenture relating to such particular application or demand, no additional
certificate or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture shall include (i) a statement that the Person
making such certificate or opinion has read such covenant or condition, (ii) 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, (iii) a statement that, in the opinion of such Person, he has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with and (iv) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with.
SECTION 1.10. PAYMENTS DUE ON LEGAL HOLIDAYS.
In any case where the date of maturity of interest on or principal of
and premium, if any, on the Debt Securities of a series or the date fixed for
redemption or repayment of any Debt Security or the making of any sinking fund
payment shall not be a business day at any Place of Payment for the Debt
Securities of such series, then payment of interest or principal and premium, if
any, or the making of such sinking fund payment need not be made on such date at
such Place of Payment, but may be made on the next succeeding business day at
such Place of Payment with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest shall accrue for the
period after such date. If a record date is not a business day, the record date
shall not be affected.
10
Subordinated Indenture
SECTION 1.11. PROVISIONS REQUIRED BY TRUST INDENTURE ACT TO CONTROL.
If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with a provision of the Trust Indenture Act or with
another provision included in this Indenture which is required to be included in
this Indenture by any of Sections 310 to 318, inclusive, of the Trust Indenture
Act, such required provision shall control.
SECTION 1.12. COMPUTATION OF INTEREST ON DEBT SECURITIES.
Interest, if any, on the Debt Securities shall be computed on the basis
of a 360-day year of twelve 30-day months, except as may otherwise be provided
pursuant to Section 2.03.
SECTION 1.13. RULES BY TRUSTEE, PAYING AGENT AND REGISTRAR.
The Trustee may make reasonable rules for action by or a meeting of
Holders. The Registrar and any paying agent may make reasonable rules for their
functions.
SECTION 1.14. NO RECOURSE AGAINST OTHERS.
Neither the Parent Partnership nor the General Partner, nor any past,
present or future director, officer, partner, employee, incorporator, manager,
stockholder, unitholder or member of the Partnership, the General Partner, the
Parent Partnership or any other Person an obligor on the Debt Securities of any
series, as such, shall have any liability for any obligations of the Partnership
or any other obligors under the Debt Securities or this Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Debt Security waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Debt Securities.
SECTION 1.15. SEVERABILITY.
In case any provision in this Indenture or the Debt Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 1.16. EFFECT OF HEADINGS.
The article and section headings herein and in the Table of Contents
are for convenience only and shall not affect the construction hereof.
SECTION 1.17. INDENTURE MAY BE EXECUTED IN COUNTERPARTS.
This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one and the same instrument.
ARTICLE 2
DEBT SECURITIES
SECTION 2.01. FORMS GENERALLY.
The Debt Securities of each series shall be in substantially the form
established without the approval of any Holder by or pursuant to a Board
Resolution of the Partnership or in one or more Indentures supplemental hereto,
in each case with such appropriate insertions, omissions,
11
Subordinated Indenture
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as the Partnership may deem
appropriate (and, if not contained in a supplemental Indenture entered into in
accordance with Article 9, as are not prohibited by the provisions of this
Indenture) or as may be required or appropriate to comply with any law or with
any rules made pursuant thereto or with any rules of any securities exchange on
which such series of Debt Securities may be listed, or to conform to general
usage, or as may, consistently herewith, be determined by the officers executing
such Debt Securities as evidenced by their execution of the Debt Securities.
The definitive Debt Securities of each series shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers executing such Debt Securities,
as evidenced by their execution of such Debt Securities.
SECTION 2.02. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
The Trustee's Certificate of Authentication on all Debt Securities
authenticated by the Trustee shall be in substantially the following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series designated therein
referred to in the within-mentioned Indenture.
----------------------------------------,
As Trustee
By
--------------------------------------
Authorized Signatory
Dated:
SECTION 2.03. PRINCIPAL AMOUNT; ISSUABLE IN SERIES.
The aggregate principal amount of Debt Securities which may be issued,
executed, authenticated, delivered and outstanding under this Indenture is
unlimited.
The Debt Securities may be issued in one or more series. There shall be
established, without the approval of any Holders, in or pursuant to a Board
Resolution of the Partnership and set forth in an Officers' Certificate of the
Partnership, or established in one or more Indentures supplemental hereto, prior
to the issuance of Debt Securities of any series any or all of the following:
(1) the form and title of the Debt Securities of the series
(which shall distinguish the Debt Securities of the series from all
other Debt Securities);
(2) any limit upon the aggregate principal amount of the Debt
Securities of the series which may be authenticated and delivered under
this Indenture (except for Debt
12
Subordinated Indenture
Securities authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Debt Securities of the
series pursuant to this Article 2);
(3) the date or dates on which the Debt Securities may be
issued; the date or dates on which the principal and premium, if any,
of the Debt Securities of the series are payable;
(4) the rate or rates (which may be fixed or variable) at
which the Debt Securities of the series shall bear interest, if any, or
the method of determining such rate or rates, the date or dates from
which such interest shall accrue, the interest payment dates on which
such interest shall be payable, or the method by which such date will
be determined, and in the case of Registered Securities, the record
dates for the determination of Holders thereof to whom such interest is
payable; and the basis upon which interest will be calculated if other
than that of a 360-day year of twelve thirty-day months;
(5) the Place or Places of Payment, if any, in addition to or
instead of the Corporate Trust Office of the Trustee where the
principal of, and premium, if any, and interest on, Debt Securities of
the series shall be payable;
(6) the price or prices at which, the period or periods within
which and the terms and conditions upon which Debt Securities of the
series may be redeemed, in whole or in part, at the option of the
Partnership or otherwise;
(7) the obligation, if any, of the Partnership to redeem,
purchase or repay Debt Securities of the series pursuant to any sinking
fund or analogous provisions or at the option of a Holder thereof, and
the price or prices at which and the period or periods within which and
the terms and conditions upon which Debt Securities of the series shall
be redeemed, purchased or repaid, in whole or in part, pursuant to such
obligations;
(8) the terms, if any, upon which the Debt Securities of the
series may be convertible into or exchanged for Equity Interests, other
Debt Securities or other securities of any kind of the Partnership or
any other obligor or issuer and the terms and conditions upon which
such conversion or exchange shall be effected, including the initial
conversion or exchange price or rate, the conversion or exchange period
and any other provision in addition to or in lieu of those described
herein;
(9) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Debt Securities of the
series shall be issuable;
(10) if the amount of principal of or any premium or interest
on Debt Securities of the series may be determined with reference to an
index or pursuant to a formula, the manner in which such amounts will
be determined;
(11) if the principal amount payable at the Stated Maturity of
Debt Securities of the series will not be determinable as of any one or
more dates prior to such Stated Maturity, the amount which will be
deemed to be such principal amount as of any such date for any purpose,
including the principal amount thereof which will be due and payable
upon any maturity other than the Stated Maturity or which will be
deemed to be Outstanding as of any such date (or, in any such case, the
manner in which such deemed principal amount is to be determined); and
the manner of determining the equivalent
13
Subordinated Indenture
thereof in the currency of the United States of America for purposes of
the definition of Dollar Equivalent;
(12) any changes or additions to Article 11, including the
addition of additional covenants that may be subject to the covenant
defeasance option pursuant to Section 11.02(b);
(13) if other than Dollars, the coin or Currency or Currencies
or units of two or more Currencies in which payment of the principal of
and premium, if any, and interest on, Debt Securities of the series
shall be payable;
(14) if other than the principal amount thereof, the portion
of the principal amount of Debt Securities of the series which shall be
payable upon declaration of acceleration of the maturity thereof
pursuant to Section 6.01 or provable in bankruptcy pursuant to Section
6.02;
(15) the terms, if any, of the transfer, mortgage, pledge or
assignment as security for the Debt Securities of the series of any
properties, assets, moneys, proceeds, securities or other collateral,
including whether certain provisions of the Trust Indenture Act are
applicable and any corresponding changes to provisions of this
Indenture as currently in effect;
(16) any addition to or change in the Events of Default with
respect to the Debt Securities of the series and any change in the
right of the Trustee or the Holders to declare the principal of and
interest on, such Debt Securities due and payable;
(17) if the Debt Securities of the series shall be issued in
whole or in part in the form of a Global Security or Securities, the
terms and conditions, if any, upon which such Global Security or
Securities may be exchanged in whole or in part for other individual
Debt Securities in definitive registered form; and the Depositary for
such Global Security or Securities and the form of any legend or
legends to be borne by any such Global Security or Securities in
addition to or in lieu of the legend referred to in Section 2.15;
(18) any trustees, authenticating or paying agents, transfer
agents or registrars;
(19) the applicability of, and any addition to or change in
the covenants and definitions currently set forth in this Indenture or
in the terms currently set forth in Article 10, including conditioning
any merger, conveyance, transfer or lease permitted by Article 10 upon
the satisfaction of an indebtedness coverage standard by the
Partnership and any Successor Company (as defined in Article 10);
(20) the terms, if any, of any guarantee of the payment of
principal of, and premium, if any, and interest on, Debt Securities of
the series and any corresponding changes to the provisions of this
Indenture as currently in effect;
(21) the subordination, if any, of the Debt Securities of the
series pursuant to Article 12 and any changes or additions to Article
12 or designation of any Designated Senior Indebtedness;
14
Subordinated Indenture
(22) with regard to Debt Securities of the series that do not
bear interest, the dates for certain required reports to the Trustee;
(23) any other terms of the Debt Securities of the series
(which terms shall not be prohibited by the provisions of this
Indenture); and
(24) applicable CUSIP Numbers.
All Debt Securities of any one series appertaining thereto shall be
substantially identical except as to denomination and except as may otherwise be
provided in or pursuant to such Board Resolutions and as set forth in such
Officers' Certificates or in any such Indenture supplemental hereto.
SECTION 2.04. EXECUTION OF DEBT SECURITIES.
The Debt Securities shall be signed on behalf of the Partnership by the
Chairman of the Board, the President or a Vice President of the General Partner.
Such signatures upon the Debt Securities may be the manual or facsimile
signatures of the present or any future such authorized officers and may be
imprinted or otherwise reproduced on the Debt Securities. The seal of the
Partnership, if any, may be in the form of a facsimile thereof and may be
impressed, affixed, imprinted or otherwise reproduced on the Debt Securities.
Only such Debt Securities as shall bear thereon a certificate of
authentication substantially in the form hereinbefore recited, signed manually
by the Trustee, shall be entitled to the benefits of this Indenture or be valid
or obligatory for any purpose. Such certificate by the Trustee upon any Debt
Security executed by the Partnership shall be conclusive evidence that the Debt
Security so authenticated has been duly authenticated and delivered hereunder.
In case any officer of the General Partner who shall have signed any of
the Debt Securities shall cease to be such officer before the Debt Securities so
signed shall have been authenticated and delivered by the Trustee, or disposed
of by the Partnership, such Debt Securities nevertheless may be authenticated
and delivered or disposed of as though the Person who signed such Debt
Securities had not ceased to be such officer of the General Partner; and any
Debt Security may be signed on behalf of the Partnership by such Persons as, at
the actual date of the execution of such Debt Security, shall be the proper
officers of the General Partner although at the date of such Debt Security or of
the execution of this Indenture any such Person was not such officer.
SECTION 2.05. AUTHENTICATION AND DELIVERY OF DEBT SECURITIES.
At any time and from time to time after the execution and delivery of
this Indenture, the Partnership may deliver Debt Securities of any series
executed by the Partnership to the Trustee for authentication, and the Trustee
shall thereupon authenticate and deliver said Debt Securities to or upon an
Issuer Order. The Debt Securities shall be dated the date of their
authentication. In authenticating such Debt Securities and accepting the
additional responsibilities under this Indenture in relation to such Debt
Securities, the Trustee shall be entitled to receive, and (subject to Section
7.01) shall be fully protected in relying upon:
(i) a copy of any Board Resolution of the Partnership,
certified by the Secretary or Assistant Secretary of the General
Partner of the Partnership, authorizing the terms of issuance of any
series of Debt Securities;
15
Subordinated Indenture
(ii) an executed supplemental Indenture, if any;
(iii) an Officers' Certificate; and
(iv) an Opinion of Counsel prepared in accordance with Section
1.09 substantially to the effect that:
(a) the form of such Debt Securities has been
established by or pursuant to a Board Resolution of the
Partnership or by a supplemental Indenture as permitted by
Section 2.01 in conformity with the provisions of this
Indenture;
(b) the terms of such Debt Securities have been
established by or pursuant to a Board Resolution of the
Partnership or by a supplemental Indenture as permitted by
Section 2.03 in conformity with the provisions of this
Indenture; and
(c) such Debt Securities, when authenticated and
delivered by the Trustee and issued by the Partnership in the
manner and subject to any conditions specified in such Opinion
of Counsel, will constitute valid and legally binding
obligations of the Partnership, enforceable in accordance with
their terms except as (y) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally and (z) rights
of acceleration and the availability of equitable remedies may
be limited by equitable principles of general applicability.
Such Opinion of Counsel need express no opinion as to whether a court
in the United States would render a money judgment in a Currency other than
Dollars.
The Trustee shall have the right to decline to authenticate and deliver
any Debt Securities under this Section 2.05 if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken or if the Trustee
in good faith by its board of directors or trustees, executive committee or a
trust committee of directors, trustees or vice presidents shall determine that
such action would expose the Trustee to personal liability to existing Holders.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Partnership to authenticate Debt Securities of any series. Unless limited
by the terms of such appointment, an authenticating agent may authenticate Debt
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as any Registrar, paying agent or agent
for service of notices and demands.
Unless otherwise provided in the form of Debt Security for any series,
each Debt Security shall be dated the date of its authentication.
SECTION 2.06. DENOMINATION OF DEBT SECURITIES.
Unless otherwise provided in the form of Debt Security for any series,
the Debt Securities of each series shall be issuable only as Registered
Securities in such denominations as shall be specified or contemplated by
Section 2.03. In the absence of any such specification with respect to the Debt
Securities of any series, the Debt Securities of such series shall be issuable
in denominations of $1,000 and any integral multiple thereof.
16
Subordinated Indenture
SECTION 2.07. GENERAL PROVISIONS FOR REGISTRATION OF TRANSFER AND
EXCHANGE.
The Partnership shall keep or cause to be kept a register for each
series of Registered Securities issued hereunder (hereinafter collectively
referred to as the "DEBT SECURITY REGISTER"), in which, subject to such
reasonable regulations as it may prescribe, the Partnership shall provide for
the registration of Registered Securities and the transfer of Registered
Securities as in this Article 2 provided. At all reasonable times the Debt
Security Register shall be open for inspection by the Trustee. Subject to
Section 2.15, upon due presentment for registration of transfer of any
Registered Security at any office or agency to be maintained by the Partnership
in accordance with the provisions of Section 4.02, the Partnership shall execute
and the Trustee shall authenticate and deliver in the name of the transferee or
transferees a new Registered Security or Registered Securities of authorized
denominations for a like aggregate principal amount.
Unless and until otherwise determined by a Board Resolution of the
Partnership, the register of the Partnership for the purpose of registration,
exchange or registration of transfer of the Registered Securities shall be kept
at the Corporate Trust Office of the Trustee and, for this purpose, the Trustee
shall be designated "REGISTRAR". No prior notice to the Holders of Debt
Securities is required to effect the designation of a substitute Registrar by
the Partnership.
Registered Securities of any series (other than a Global Security,
except as set forth below) may be exchanged for a like aggregate principal
amount of Registered Securities of the same series of other authorized
denominations. Subject to Section 2.15, Registered Securities to be exchanged
shall be surrendered at the office or agency to be maintained by the Partnership
as provided in Section 4.02, and the Partnership shall execute and the Trustee
shall authenticate and deliver in exchange therefor the Registered Security or
Registered Securities that the Holder making the exchange shall be entitled to
receive.
All Registered Securities presented or surrendered for registration of
transfer, exchange or payment shall (if so required by the Partnership, the
Trustee or the Registrar) be duly endorsed or be accompanied by a written
instrument or instruments of transfer, in form satisfactory to the Partnership,
the Trustee and the Registrar, duly executed by the Registered Holder or his
attorney duly authorized in writing.
All Debt Securities issued in exchange for or upon transfer of Debt
Securities shall be the legal, valid and binding obligations of the Partnership,
evidencing the same debt, and entitled to the same benefits under this Indenture
as the Debt Securities surrendered for such exchange or transfer.
No service charge shall be made for any exchange or registration of
transfer of Debt Securities (except as provided by Section 2.09), but the
Partnership may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto, other than those
expressly provided in this Indenture to be made at the Partnership's own expense
or without expense or without charge to the Holders.
The Partnership shall not be required (i) to issue, register the
transfer of or exchange any Debt Securities for a period of 15 days next
preceding any mailing of notice of redemption of Debt Securities of such series
or (ii) to register the transfer of or exchange any Debt Securities selected,
called or being called for redemption.
Specific procedures for registration of transfer and exchange of any
series of Debt Securities may be set forth in the applicable supplemental
Indenture for such Debt Securities.
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Subordinated Indenture
SECTION 2.08. TEMPORARY DEBT SECURITIES.
Pending the preparation of definitive Debt Securities of any series,
the Partnership may execute and the Trustee shall authenticate and deliver
temporary Debt Securities (printed, lithographed, photocopied, typewritten or
otherwise produced) of any authorized denomination, and substantially in the
form of the definitive Debt Securities in lieu of which they are issued, in
registered form and with such omissions, insertions and variations as may be
appropriate for temporary Debt Securities, all as may be determined by the
Partnership with the concurrence of the Trustee. Temporary Debt Securities may
contain such reference to any provisions of this Indenture as may be
appropriate. Every temporary Debt Security shall be executed by the Partnership
and be authenticated by the Trustee upon the same conditions and in
substantially the same manner, and with like effect, as the definitive Debt
Securities.
If temporary Debt Securities of any series are issued, the Partnership
will cause definitive Debt Securities of such series to be prepared without
unreasonable delay. After the preparation of definitive Debt Securities of such
series, the temporary Debt Securities of such series shall be exchangeable for
definitive Debt Securities of such series upon surrender of the temporary Debt
Securities of such series at the office or agency of the Partnership at a Place
of Payment for such series, without charge to the Holder thereof, except as
provided in Section 2.07 in connection with a transfer, and upon surrender for
cancellation of any one or more temporary Debt Securities of any series, the
Partnership shall execute and the Trustee shall authenticate and deliver in
exchange therefor a like principal amount of definitive Debt Securities of the
same series of authorized denominations and of like tenor. Until so exchanged,
temporary Debt Securities of any series shall in all respects be entitled to the
same benefits under this Indenture as definitive Debt Securities of such series,
except as otherwise specified as contemplated by Section 2.03(17) with respect
to the payment of interest on Global Securities in temporary form.
Upon any exchange of a portion of a temporary Global Security for a
definitive Global Security or for the individual Debt Securities represented
thereby pursuant to Section 2.07 or this Section 2.08, the temporary Global
Security shall be endorsed by the Trustee to reflect the reduction of the
principal amount evidenced thereby, whereupon the principal amount of such
temporary Global Security shall be reduced for all purposes by the amount so
exchanged and endorsed.
SECTION 2.09. MUTILATED, DESTROYED, LOST OR STOLEN DEBT SECURITIES.
If (i) any mutilated Debt Security is surrendered to the Trustee at the
Corporate Trust Office of the Trustee (in the case of Registered Securities) or
(ii) the Partnership and the Trustee receive evidence to their satisfaction of
the destruction, loss or theft of any Debt Security, and there is delivered to
the Partnership and the Trustee such security or indemnity as may be required by
them to save each of them and any paying agent harmless, and neither the
Partnership nor the Trustee receives written notice that such Debt Security has
been acquired by a bona fide purchaser, then the Partnership shall execute and,
upon an Issuer Order, the Trustee shall authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Debt Security, a
new Debt Security of the same series of like tenor, form, terms and principal
amount, bearing a number not contemporaneously Outstanding. Upon the issuance of
any substituted Debt Security, the Partnership may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses connected therewith. In case any Debt
Security which has matured or is about to mature or which has been called for
redemption shall become mutilated or be destroyed, lost or stolen, the
Partnership may, instead of issuing a substituted Debt Security, pay or
authorize the
18
Subordinated Indenture
payment of the same (without surrender thereof except in the case of a mutilated
Debt Security) if the applicant for such payment shall furnish the Partnership
and the Trustee with such security or indemnity as either may require to save it
harmless from all risk, however remote, and, in case of destruction, loss or
theft, evidence to the satisfaction of the Partnership and the Trustee of the
destruction, loss or theft of such Debt Security and of the ownership thereof.
Every substituted Debt Security of any series issued pursuant to the
provisions of this Section 2.09 by virtue of the fact that any Debt Security is
destroyed, lost or stolen shall constitute an original additional contractual
obligation of the Partnership, whether or not the destroyed, lost or stolen Debt
Security shall be found at any time, and shall be entitled to all the benefits
of this Indenture equally and proportionately with any and all other Debt
Securities of that series duly issued hereunder. All Debt Securities shall be
held and owned upon the express condition that the foregoing provisions are
exclusive with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Debt Securities, and shall preclude any and all other rights or
remedies, notwithstanding any law or statute existing or hereafter enacted to
the contrary with respect to the replacement or payment of negotiable
instruments or other securities without their surrender.
SECTION 2.10. CANCELLATION OF SURRENDERED DEBT SECURITIES.
All Debt Securities surrendered for payment, redemption, registration
of transfer or exchange shall, if surrendered to the Partnership or any paying
agent or a Registrar, be delivered to the Trustee for cancellation by it, or if
surrendered to the Trustee, shall be canceled by it, and no Debt Securities
shall be issued in lieu thereof except as expressly permitted by any of the
provisions of this Indenture. All canceled Debt Securities held by the Trustee
shall be disposed of (subject to the record retention requirements of the
Exchange Act) by the Trustee in its customary manner. On request of the
Partnership, the Trustee shall deliver to the Partnership canceled Debt
Securities held by the Trustee. If the Partnership shall acquire any of the Debt
Securities, however, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented thereby unless and until the same
are delivered or surrendered to the Trustee for cancellation. The Partnership
may not issue new Debt Securities to replace Debt Securities it has redeemed,
paid or delivered to the Trustee for cancellation.
SECTION 2.11. PROVISIONS OF THIS INDENTURE AND DEBT SECURITIES FOR THE
SOLE BENEFIT OF THE PARTIES AND THE HOLDERS.
Nothing in this Indenture or in the Debt Securities, expressed or
implied, shall give or be construed to give to any Person, other than the
parties hereto, the Holders or any Registrar or paying agent, any legal or
equitable right, remedy or claim under or in respect of this Indenture, or under
any covenant, condition or provision herein contained, all its covenants,
conditions and provisions being for the sole benefit of the parties hereto, the
Holders and any Registrar and paying agents.
SECTION 2.12. PAYMENT OF INTEREST; RIGHTS PRESERVED.
Interest on any Registered Security that is payable and is punctually
paid or duly provided for on any interest payment date shall be paid to the
Person in whose name such Registered Security is registered at the close of
business on the regular record date for such interest notwithstanding the
cancellation of such Registered Security upon any transfer or exchange
subsequent to the regular record date. Payment of interest on Registered
Securities shall be made at the Corporate Trust Office of the Trustee (except as
otherwise specified pursuant
19
Subordinated Indenture
to Section 2.03), or at the option of the Partnership, by check mailed to the
address of the Person entitled thereto as such address shall appear in the Debt
Security Register or, if provided pursuant to Section 2.03 and in accordance
with arrangements satisfactory to the Trustee, at the option of the Registered
Holder by wire transfer to an account designated by the Registered Holder.
Subject to the foregoing provisions of this Section 2.12 and Section
2.17, each Debt Security of a particular series delivered under this Indenture
upon registration of transfer of or in exchange for or in lieu of any other Debt
Security of the same series shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by such other Debt Security.
SECTION 2.13. SECURITIES DENOMINATED IN FOREIGN CURRENCIES.
Except as otherwise specified pursuant to Section 2.03 for Registered
Securities of any series, payment of the principal of, and premium, if any, and
interest on, Registered Securities of such series will be made in Dollars.
For the purposes of calculating the principal amount of Debt Securities
of any series denominated in a Foreign Currency or in units of two or more
Foreign Currencies for any purpose under this Indenture, the principal amount of
such Debt Securities at any time Outstanding shall be deemed to be the Dollar
Equivalent of such principal amount as of the date of any such calculation.
In the event any Foreign Currency or currencies or units of two or more
Currencies in which any payment with respect to any series of Debt Securities
may be made ceases to be a freely convertible Currency on United States Currency
markets, for any date thereafter on which payment of principal of, or premium,
if any, or interest on, the Debt Securities of a series is due, the Partnership
shall select the Currency of payment for use on such date, all as provided in
the Debt Securities of such series. In such event, the Partnership shall, as
provided in the Debt Securities of such series, notify the Trustee of the
Currency which they have selected to constitute the funds necessary to meet the
Partnership's obligations or such payment date and of the amount of such
Currency to be paid. Such amount shall be determined as provided in the Debt
Securities of such series. The payment to the Trustee with respect to such
payment date shall be made by the Partnership solely in the Currency so
selected.
SECTION 2.14. WIRE TRANSFERS.
Notwithstanding any other provision to the contrary in this Indenture,
the Partnership may make any payment of monies required to be deposited with the
Trustee on account of principal of, or premium, if any, or interest on, the Debt
Securities (whether pursuant to optional or mandatory redemption payments,
interest payments or otherwise) by wire transfer of immediately available funds
to an account designated by the Trustee on or before the date such moneys are to
be paid to the Holders of the Debt Securities in accordance with the terms
hereof.
SECTION 2.15. SECURITIES ISSUABLE IN THE FORM OF A GLOBAL SECURITY.
If the Partnership shall establish pursuant to Sections 2.01 and 2.03
that the Debt Securities of a particular series are to be issued in whole or in
part in the form of one or more Global Securities, then the Partnership shall
execute and the Trustee or its agent shall, in accordance with Section 2.05,
authenticate and deliver, such Global Security or Securities, which (i) shall
represent, and shall be denominated in an amount equal to the aggregate
principal amount of, the Outstanding Debt Securities of such series to be
represented by such Global Security or
20
Subordinated Indenture
Securities, or such portion thereof as the Partnership shall specify in an
Officers' Certificate, (ii) shall be registered in the name of the Depositary
for such Global Security or securities or its nominee, (iii) shall be delivered
by the Trustee or its agent to the Depositary or pursuant to the Depositary's
instruction and (iv) shall conspicuously bear a legend substantially to the
following effect: "Unless and until it is exchanged in whole or in part for the
individual Debt Securities represented hereby, this Global Security may not be
transferred except as a whole by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary", or such other legend as may then be
required by the Depositary for such Global Security or Securities.
Notwithstanding any other provision of this Section 2.15 or of Section
2.07 to the contrary, and subject to the provisions of the next following
paragraph of this Section 2.15 (and all of its clauses), it unless the terms of
a Global Security expressly permit such Global Security to be exchanged in whole
or in part for definitive Debt Securities in registered form, a Global Security
may be transferred, in whole but not in part and in the manner provided in
Section 2.07, only by the Depositary to a nominee of the Depositary for such
Global Security, or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary, or by the Depositary or a nominee of the Depositary
to a successor Depositary for such Global Security selected or approved by the
Partnership, or to a nominee of such successor Depositary.
The second paragraph of this Section 2.15 shall be subject to the
following clauses (i) through (v) (inclusive):
(i) If at any time the Depositary for a Global Security or
Securities notifies the Partnership that it is unwilling or unable to
continue as Depositary for such Global Security or Securities or if at
any time the Depositary for the Debt Securities for such series shall
no longer be eligible or in good standing under the Exchange Act or
other applicable statute, rule or regulation, the Partnership shall
appoint a successor Depositary with respect to such Global Security or
Securities. If a successor Depositary for such Global Security or
Securities is not appointed by the Partnership within 90 days after the
Partnership receive such notice or become aware of such ineligibility,
the Partnership shall execute, and the Trustee or its agent, upon
receipt of an Issuer Order for the authentication and delivery of such
individual Debt Securities of such series in exchange for such Global
Security, will authenticate and deliver, individual Debt Securities of
such series of like tenor and terms in definitive form in an aggregate
principal amount equal to the principal amount of the Global Security
in exchange for such Global Security or Securities.
(ii) The Partnership may at any time and in their sole
discretion determine that the Debt Securities of any series or portion
thereof issued or issuable in the form of one or more Global Securities
shall no longer be represented by such Global Security or Securities.
In such event the Partnership will execute, and the Trustee, upon
receipt of an Issuer Order for the authentication and delivery of
individual Debt Securities of such series in exchange in whole or in
part for such Global Security, will authenticate and deliver individual
Debt Securities of such series of like tenor and terms in definitive
form in an aggregate principal amount equal to the principal amount of
such series or portion thereof in exchange for such Global Security or
Securities.
(iii) If specified by the Partnership pursuant to Sections
2.01 and 2.03 with respect to Debt Securities issued or issuable in the
form of a Global Security, the
21
Subordinated Indenture
Depositary for such Global Security may surrender such Global Security
in exchange in whole or in part for individual Debt Securities of such
series of like tenor and terms in definitive form on such terms as are
acceptable to the Partnership, the Trustee and such Depositary.
Thereupon the Partnership shall execute, and the Trustee or its agent
upon receipt of an Issuer Order for the authentication and delivery of
definitive Debt Securities of such series shall authenticate and
deliver, without service charge, (y) to each Person specified by such
Depositary a new Debt Security or Securities of the same series of like
tenor and terms and of any authorized denomination as requested by such
Person in aggregate principal amount equal to and in exchange for such
Person's beneficial interest in the Global Security, and (z) to such
Depositary a new Global Security of like tenor and terms and in an
authorized denomination equal to the difference, if any, between the
principal amount of the surrendered Global Security and the aggregate
principal amount of Debt Securities delivered to Holders thereof.
(iv) In any exchange provided for in any of the preceding
three paragraphs, the Partnership will execute and the Trustee or its
agent will authenticate and deliver individual Debt Securities. Upon
the exchange of the entire principal amount of a Global Security for
individual Debt Securities, such Global Security shall be canceled by
the Trustee or its agent. Except as provided in the preceding
paragraph, Registered Securities issued in exchange for a Global
Security pursuant to this Section 2.15 shall be registered in such
names and in such authorized denominations as the Depositary for such
Global Security, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee or the Registrar.
The Trustee or the Registrar shall deliver such Registered Securities
to the Persons in whose names such Registered Securities are so
registered.
(v) Payments in respect of the principal of and interest on
any Debt Securities registered in the name of the Depositary or its
nominee will be payable to the Depositary or such nominee in its
capacity as the registered owner of such Global Security. The
Partnership and the Trustee may treat the Person in whose name the Debt
Securities, including the Global Security, are registered as the owner
thereof for the purpose of receiving such payments and for any and all
other purposes whatsoever. None of the Partnership, the Trustee, any
Registrar, the paying agent or any agent of the Partnership or the
Trustee will have any responsibility or liability for (x) any aspect of
the records relating to or payments made on account of the beneficial
ownership interests of the Global Security by the Depositary or its
nominee or any of the Depositary's direct or indirect participants, or
for maintaining, supervising or reviewing any records of the
Depositary, its nominee or any of the Depositary's direct or indirect
participants relating to the beneficial ownership interests of the
Global Security, (y) the payments to the beneficial owners of the
Global Security of amounts paid to the Depositary or its nominee, or
(z) any other matter relating to the actions and practices of the
Depositary, its nominee or any of the Depositary's direct or indirect
participants. None of the Partnership, the Trustee or any such agent
will be liable for any delay by the Depositary, its nominee, or any of
the Depositary's direct or indirect participants in identifying the
beneficial owners of the Debt Securities, and the Partnership and the
Trustee may conclusively rely on, and will be protected in relying on,
instructions from the Depositary or its nominee for all purposes
(including with respect to the registration and delivery, and the
respective principal amounts, of the Debt Securities to be issued).
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Subordinated Indenture
SECTION 2.16. MEDIUM TERM SECURITIES.
Notwithstanding any contrary provision herein, if all Debt Securities
of a series are not to be originally issued at one time, it shall not be
necessary for the Partnership to deliver to the Trustee an Officers'
Certificate, a Board Resolution, a supplemental Indenture, an Opinion of Counsel
or a written order or any other document otherwise required pursuant to Section
1.09, 2.01, 2.03 or 2.05 at or prior to the time of authentication of each Debt
Security of such series if such documents are delivered to the Trustee or its
agent at or prior to the authentication upon original issuance of the first such
Debt Security of such series to be issued; provided, that any subsequent request
by the Partnership to the Trustee to authenticate Debt Securities of such series
upon original issuance shall constitute a representation and warranty by the
Partnership that, as of the date of such request, the statements made in the
Officers' Certificate delivered pursuant to Section 1.09 or 2.05 shall be true
and correct as if made on such date and that the Opinion of Counsel delivered at
or prior to such time of authentication of an original issuance of Debt
Securities shall specifically state that it shall relate to all subsequent
issuances of Debt Securities of such series that are identical to the Debt
Securities issued in the first issuance of Debt Securities of such series.
An Issuer Order delivered by the Partnership to the Trustee in the
circumstances set forth in the preceding paragraph may provide that Debt
Securities which are the subject thereof will be authenticated and delivered by
the Trustee or its agent on original issue from time to time upon the telephonic
or written order of Persons designated in such written order (any such
telephonic instructions to be promptly confirmed in writing by such Person) and
that such Persons are authorized to determine, consistent with the Officers'
Certificates, supplemental Indenture or the applicable Board Resolutions
relating to such written order, such terms and conditions of such Debt
Securities as are specified in such Officers' Certificates, supplemental
Indenture or such Board Resolutions.
SECTION 2.17. DEFAULTED INTEREST.
Any interest on any Debt Security of a particular series which is
payable, but is not punctually paid or duly provided for, on the dates and in
the manner provided in the Debt Securities of such series and in this Indenture
(herein called "DEFAULTED INTEREST") shall forthwith cease to be payable to the
Registered Holder thereof on the relevant record date by virtue of having been
such Registered Holder, and such Defaulted Interest may be paid by the
Partnership, at its election in each case, as provided in clause (i) or (ii)
below:
(i) The Partnership may elect to make payment of any Defaulted
Interest to the Persons in whose names the Registered Securities of
such series are registered at the close of business on a special record
date for the payment of such Defaulted Interest, which shall be fixed
in the following manner: the Partnership shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each
such Registered Security of such series and the date of the proposed
payment, and at the same time the Partnership shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
clause provided. Thereupon the Trustee shall fix a special record date
for the payment of such Defaulted Interest which shall be not more than
15 days and not less than 10 days prior to the date of the proposed
payment and not less than 10 days after the receipt by the Trustee of
the notice of the proposed
23
Subordinated Indenture
payment. The Trustee shall promptly notify the Partnership of such
special record date and, in the name and at the expense of the
Partnership, shall cause notice of the proposed payment of such
Defaulted Interest and the special record date therefor to be mailed,
first class postage prepaid, to each Holder thereof at its address as
it appears in the Debt Security Register, not less than 10 days prior
to such special record date. Notice of the proposed payment of such
Defaulted Interest and the special record date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose
names the Registered Securities of such series are registered at the
close of business on such special record date.
(ii) The Partnership may make payment of any Defaulted
Interest on the Registered Securities of such series in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Registered Securities of such series may be
listed, and upon such notice as may be required by such exchange, if,
after notice given by the Partnership to the Trustee of the proposed
payment pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
SECTION 2.18. JUDGMENTS.
The Partnership may provide pursuant to Section 2.03 for Debt
Securities of any series that: (i) the obligation, if any, of the Partnership to
pay the principal of, and premium, if any, and interest on, the Debt Securities
of any series in a Foreign Currency or Dollars (the "DESIGNATED CURRENCY") as
may be specified pursuant to Section 2.03 is of the essence and agrees that, to
the fullest extent possible under applicable law, judgments in respect of Debt
Securities of such series shall be given in the Designated Currency; (ii) the
obligation of the Partnership to make payments in the Designated Currency of the
principal of, and premium, if any, and interest on, such Debt Securities shall,
notwithstanding any payment in any other Currency (whether pursuant to a
judgment or otherwise), be discharged only to the extent of the amount in the
Designated Currency that the Holder receiving such payment may, in accordance
with normal banking procedures, purchase with the sum paid in such other
Currency (after any premium and cost exchange) on the business day in the
country of issue of the Designated Currency or in the international banking
community (in the case of a composite currency) immediately following the day on
which such Holder receives such payment; (iii) if the amount in the Designated
Currency that may be so purchased for any reason falls short of the amount
originally due, the Partnership shall pay such additional amounts as may be
necessary to compensate for such shortfall; and (iv) any obligation of the
Partnership not discharged by such payment shall be due as a separate and
independent obligation and, until discharged as provided herein, shall continue
in full force and effect.
SECTION 2.19. CUSIP NUMBERS.
The Partnership in issuing the Debt Securities may use "CUSIP" numbers
(if then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Holders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Debt Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Debt Securities, and any such redemption shall not be
affected by any defect in or omission of such numbers. The Partnership will
promptly notify the Trustee of any change in the "CUSIP" numbers.
24
Subordinated Indenture
ARTICLE 3
REDEMPTION OF DEBT SECURITIES
SECTION 3.01. APPLICABILITY OF ARTICLE.
The provisions of this Article shall be applicable to the Debt
Securities of any series which are redeemable before their Stated Maturity
except as otherwise specified as contemplated by Section 2.03 for Debt
Securities of such series.
SECTION 3.02. NOTICE OF REDEMPTION; SELECTION OF DEBT SECURITIES.
In case the Partnership shall desire to exercise the right to redeem
all or, as the case may be, any part of the Debt Securities of any series in
accordance with their terms, a Board Resolution of the Partnership or a
supplemental Indenture, the Partnership shall fix a date for redemption and
shall give notice of such redemption at least 30 and not more than 60 days prior
to the date fixed for redemption to the Holders of Debt Securities of such
series so to be redeemed as a whole or in part, in the manner provided in
Section 1.07. The notice if given in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the Holder
receives such notice. In any case, failure to give such notice or any defect in
the notice to the Holder of any Debt Security of a series designated for
redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Debt Security of such series.
Each such notice of redemption shall specify (i) the amount of Debt
Securities of any series to be redeemed, (ii) the date fixed for redemption,
(iii) the calculation of the redemption price at which Debt Securities of such
series are to be redeemed, (iv) the Place or Places of Payment that payment will
be made upon presentation and surrender of such Debt Securities, (v) that any
interest accrued to the date fixed for redemption will be paid as specified in
said notice, (vi) that the redemption is for a sinking fund payment (if
applicable), (vii) that, unless otherwise specified in such notice, if the
Partnership defaults in making such redemption payment or if the Debt Securities
of that series are subordinated pursuant to the terms of Article 12, the paying
agent is prohibited from making such payment pursuant to the terms of this
Indenture, (viii) that on and after said date any interest thereon or on the
portions thereof to be redeemed will cease to accrue, (ix) that in the case of
Original Issue Discount Securities original issue discount accrued after the
date fixed for redemption will cease to accrue, the terms of the Debt Securities
of that series pursuant to which the Debt Securities of that series are being
redeemed and (x) 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
Debt Securities of that series. If less than all the Debt Securities of a series
are to be redeemed the notice of redemption shall specify the CUSIP numbers of
the Debt Securities of that series to be redeemed. In case any Debt Security of
a series is to be redeemed in part only, the notice of redemption shall state
the portion of the principal amount thereof to be redeemed and shall state that
on and after the date fixed for redemption, upon surrender of such Debt
Security, a new Debt Security or Debt Securities of that series will be issued
in principal amount equal to the unredeemed portion thereof.
At least 45 days but not more than 60 days before the redemption date,
unless the Trustee consents to a shorter period, the Partnership shall give
written notice to the Trustee of the redemption date, the principal amount of
Debt Securities to be redeemed and the series and terms of the Debt Securities
pursuant to which such redemption will occur. Such notice shall be accompanied
by an Officers' Certificate and an Opinion of Counsel to the effect that such
redemption will comply with the conditions herein. If fewer than all the Debt
Securities of a
25
Subordinated Indenture
series are to be redeemed, the record date relating to such redemption shall be
selected by the Partnership and given to the Trustee, which record date shall be
not less than 15 days after the date of notice to the Trustee.
By 11:00 a.m. New York City time, on the redemption date for any Debt
Securities, the Partnership shall deposit with the Trustee or with a paying
agent (or, if the Partnership is acting as its own paying agent, segregate and
hold in trust) an amount of money in the Currency in which such Debt Securities
are denominated (except as provided pursuant to Section 2.03) sufficient to pay
the redemption price of such Debt Securities or any portions thereof that are to
be redeemed on that date.
If less than all the Debt Securities of like tenor and terms of a
series are to be redeemed (other than pursuant to mandatory sinking fund
redemptions), the Trustee shall select the Debt Securities of that series or
portions thereof (in multiples of $1,000) to be redeemed (i) if such Debt
Securities are listed on an exchange, in compliance with the requirements of the
principal national securities exchange on which such Debt Securities are listed,
or (ii) if such Debt Securities are not listed on an exchange or such exchange
has no selection requirements, in such manner as in its sole discretion the
Trustee shall deem appropriate and fair. In any case where more than one Debt
Security of such series is registered in the same name, the Trustee in its
discretion may treat the aggregate principal amount so registered as if it were
represented by one Debt Security of such series. The Trustee shall promptly
notify the Partnership in writing of the Debt Securities selected for redemption
and, in the case of any Debt Securities selected for partial redemption, the
principal amount thereof to be redeemed. If any Debt Security called for
redemption shall not be so paid upon surrender thereof on such redemption date,
the principal, premium, if any, and interest shall bear interest until paid from
the redemption date at the rate borne by the Debt Securities of that series. If
less than all the Debt Securities of unlike tenor and terms of a series are to
be redeemed, the particular Debt Securities to be redeemed shall be selected by
the Partnership. Provisions of this Indenture that apply to Debt Securities
called for redemption also apply to portions of Debt Securities called for
redemption.
SECTION 3.03. PAYMENT OF DEBT SECURITIES CALLED FOR REDEMPTION.
If notice of redemption has been given as provided in Section 3.02, the
Debt Securities or portions of Debt Securities of the series with respect to
which such notice has been given shall become due and payable on the date and at
the Place or Places of Payment stated in such notice at the applicable
redemption price, together with any interest accrued to the date fixed for
redemption, and on and after said date (unless the Partnership shall default in
the payment of such Debt Securities at the applicable redemption price, together
with any interest accrued to said date) any interest on the Debt Securities or
portions of Debt Securities of any series so called for redemption shall cease
to accrue and any original issue discount in the case of Original Issue Discount
Securities shall cease to accrue. On presentation and surrender of such Debt
Securities at the Place or Places of Payment in said notice specified, the said
Debt Securities or the specified portions thereof shall be paid and redeemed by
the Partnership at the applicable redemption price, together with any interest
accrued thereon to the date fixed for redemption.
Any Debt Security that is to be redeemed only in part shall be
surrendered at the Corporate Trust Office of the Trustee or such other office or
agency of the Partnership as is specified pursuant to Section 2.03, if the
Partnership, the Registrar or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Partnership, the
Registrar and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing, and the Partnership shall execute, and the Trustee
shall authenticate and deliver to the
26
Subordinated Indenture
Holder of such Debt Security without service charge, a new Debt Security or Debt
Securities of the same series, of like tenor and form, of any authorized
denomination as requested by such Holder in aggregate principal amount equal to
and in exchange for the unredeemed portion of the principal of the Debt Security
so surrendered; except that if a Global Security is so surrendered, the
Partnership shall execute, and the Trustee shall authenticate and deliver to the
Depositary for such Global Security, without service charge, a new Global
Security in a denomination equal to and in exchange for the unredeemed portion
of the principal of the Global Security so surrendered. In the case of a Debt
Security providing appropriate space for such notation, at the option of the
Holder thereof, the Trustee, in lieu of delivering a new Debt Security or Debt
Securities as aforesaid, may make a notation on such Debt Security of the
payment of the redeemed portion thereof.
SECTION 3.04. MANDATORY AND OPTIONAL SINKING FUNDS.
The minimum amount of any sinking fund payment provided for by the
terms of Debt Securities of any series, a Board Resolution or a supplemental
Indenture is herein referred to as a "MANDATORY SINKING FUND payment", and any
payment in excess of such minimum amount provided for by the terms of Debt
Securities of any series, a Board Resolution or a supplemental Indenture is
herein referred to as an "OPTIONAL SINKING FUND payment".
In lieu of making all or any part of any mandatory sinking fund payment
with respect to any Debt Securities of a series in cash, the Partnership may at
its option (i) deliver to the Trustee Debt Securities of that series theretofore
purchased or otherwise acquired by the Partnership or (ii) receive credit for
the principal amount of Debt Securities of that series which have been redeemed
either at the election of the Partnership pursuant to the terms of such Debt
Securities or through the application of permitted optional sinking fund
payments pursuant to the terms of such Debt Securities, resolution or
supplemental Indenture; provided, that such Debt Securities have not been
previously so credited. Such Debt Securities shall be received and credited for
such purpose by the Trustee at the redemption price specified in such Debt
Securities, the applicable Board Resolution or supplemental Indenture for
redemption through operation of the sinking fund and the amount of such
mandatory sinking fund payment shall be reduced accordingly.
SECTION 3.05. REDEMPTION OF DEBT SECURITIES FOR SINKING FUND.
Not less than 60 days prior to each sinking fund payment date for any
series of Debt Securities, the Partnership will deliver to the Trustee an
Officers' Certificate specifying the amount of the next ensuing sinking fund
payment for that series pursuant to the terms of that series, any Board
Resolution or supplemental Indenture, the portion thereof, if any, which is to
be satisfied by payment of cash in the Currency in which the Debt Securities of
such series are denominated (except as provided pursuant to Section 2.03) and
the portion thereof, if any, which is to be satisfied by delivering and
crediting Debt Securities of that series pursuant to this Section 3.05 (which
Debt Securities, if not previously redeemed, will accompany such certificate)
and whether the Partnership intends to exercise its right to make any permitted
optional sinking fund payment with respect to such series. Such certificate
shall also state that no Event of Default has occurred and is continuing with
respect to such series. Such certificate shall be irrevocable and upon its
delivery the Partnership shall be obligated to make the cash payment or payments
therein referred to, if any, on or before the next succeeding sinking fund
payment date. Failure of the Partnership to deliver such certificate (or to
deliver the Debt Securities specified in this paragraph) shall not constitute a
Default, but such failure shall require that the sinking fund payment due on the
next succeeding sinking fund payment date for that series shall be paid entirely
in cash and shall be sufficient to redeem the principal amount of such Debt
Securities
27
Subordinated Indenture
subject to a mandatory sinking fund payment without the option to deliver or
credit Debt Securities as provided in this Section 3.05 and without the right to
make any optional sinking fund payment, if any, with respect to such series.
Any sinking fund payment or payments (mandatory or optional) made in
cash plus any unused balance of any preceding sinking fund payments made in cash
which shall equal or exceed $100,000 (or a lesser sum if the Partnership shall
so request) with respect to the Debt Securities of any particular series shall
be applied by the Trustee on the sinking fund payment date on which such payment
is made (or, if such payment is made before a sinking fund payment date, on the
sinking fund payment date following the date of such payment) to the redemption
of such Debt Securities at the redemption price specified in such Debt
Securities, the applicable Board Resolution or supplemental Indenture for
operation of the sinking fund together with any accrued interest to the date
fixed for redemption. Any sinking fund moneys not so applied or allocated by the
Trustee to the redemption of Debt Securities shall be added to the next cash
sinking fund payment received by the Trustee for such series and, together with
such payment, shall be applied in accordance with the provisions of this Section
3.05. Any and all sinking fund moneys with respect to the Debt Securities of any
particular series held by the Trustee on the last sinking fund payment date with
respect to Debt Securities of such series and not held for the payment or
redemption of particular Debt Securities shall be applied by the Trustee,
together with other moneys, if necessary, to be deposited sufficient for the
purpose, to the payment of the principal of the Debt Securities of that series
at its Stated Maturity.
The Trustee shall select the Debt Securities to be redeemed upon such
sinking fund payment date in the manner specified in the last paragraph of
Section 3.02, and the Partnership shall cause notice of the redemption thereof
to be given in the manner provided in Section 3.02 except that the notice of
redemption shall also state that the Debt Securities are being redeemed by
operation of the sinking fund. Such notice having been duly given, the
redemption of such Debt Securities shall be made upon the terms and in the
manner stated in Section 3.03.
At least one business day before each sinking fund payment date, the
Partnership shall pay to the Trustee (or, if the Partnership is acting as its
own paying agent, the Partnership shall segregate and hold in trust) in cash a
sum in the Currency in which the Debt Securities of such series are denominated
(except as provided pursuant to Section 2.03) equal to any interest accrued to
the date fixed for redemption of Debt Securities or portions thereof to be
redeemed on such sinking fund payment date pursuant to this Section 3.05.
The Trustee shall not redeem any Debt Securities of a series with
sinking fund moneys or mail any notice of redemption of such Debt Securities by
operation of the sinking fund for such series during the continuance of a
Default in payment of interest on such Debt Securities or of any Event of
Default (other than an Event of Default occurring as a consequence of this
paragraph) with respect to such Debt Securities, except that if the notice of
redemption of any such Debt Securities shall theretofore have been mailed in
accordance with the provisions hereof, the Trustee shall redeem such Debt
Securities if cash sufficient for that purpose shall be deposited with the
Trustee for that purpose in accordance with the terms of this Article 3. Except
as aforesaid, any moneys in the sinking fund for such series at the time when
any such Default or Event of Default shall occur and any moneys thereafter paid
into such sinking fund shall, during the continuance of such Default or Event of
Default, be held as security for the payment of such Debt Securities; provided,
however, that in case such Default or Event of Default shall have been cured or
waived as provided herein, such moneys shall thereafter be applied on the next
sinking fund payment date for such Debt Securities on which such moneys may be
applied pursuant to the provisions of this Section 3.05.
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Subordinated Indenture
ARTICLE 4
PARTICULAR COVENANTS OF THE PARTNERSHIP
SECTION 4.01. PAYMENT OF PRINCIPAL OF, AND PREMIUM, IF ANY, AND
INTEREST ON, DEBT SECURITIES.
The Partnership, for the benefit of each series of Debt Securities,
will duly and punctually pay or cause to be paid the principal of, and premium,
if any, and interest on, each of the Debt Securities at the place, at the
respective times and in the manner provided herein and in the Debt Securities.
Each installment of interest on the Debt Securities may at the Partnership's
option be paid by mailing checks for such interest payable to the Person
entitled thereto to the address of such Person as it appears on the Debt
Security Register maintained pursuant to Section 2.07(a).
Principal, premium and interest of Debt Securities of any series shall
be considered paid on the date due if on such date the Trustee or any paying
agent holds in accordance with this Indenture money sufficient to pay in the
Currency in which the Debt Securities of such series are denominated (except as
provided pursuant to Section 2.03) all principal, premium and interest then due
and, in the case of Debt Securities subordinated pursuant to the terms of
Article 12, the Trustee or such paying agent, as the case may be, is not
prohibited from paying such money to the Holders on that date pursuant to the
terms of this Indenture.
The Partnership shall pay interest on overdue principal at the rate
specified therefor in the Debt Securities and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
SECTION 4.02. MAINTENANCE OF OFFICES OR AGENCIES FOR REGISTRATION OF
TRANSFER, EXCHANGE AND PAYMENT OF DEBT SECURITIES.
The Partnership will maintain in each Place of Payment for any series
of Debt Securities, an office or agency where Debt Securities of such series may
be presented or surrendered for payment, where Debt Securities of such series
may be surrendered for transfer or exchange and where notices and demands to or
upon the Partnership in respect of the Debt Securities of such series and this
Indenture may be served. The Partnership will 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 Partnership shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Partnership hereby appoint the
Trustee as its agent to receive all presentations, surrenders, notices and
demands.
The Partnership may also from time to time designate different or
additional offices or agencies to be maintained for such purposes (in or outside
of such Place of Payment), and may from time to time rescind any such
designation; provided, however, that no such designation or rescission shall in
any manner relieve the Partnership of its obligations described in the preceding
paragraph. The Partnership will give prompt written notice to the Trustee of any
such additional designation or rescission of designation and any change in the
location of any such different or additional office or agency.
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Subordinated Indenture
SECTION 4.03. APPOINTMENT TO FILL A VACANCY IN THE OFFICE OF TRUSTEE.
The Partnership, whenever necessary to avoid or fill a vacancy in the
office of Trustee, will appoint, in the manner provided in Section 7.08, a
Trustee, so that there shall at all times be a Trustee hereunder with respect to
each series of Debt Securities.
SECTION 4.04. DUTIES OF PAYING AGENTS, ETC.
The Partnership shall cause each paying agent, if any, other than the
Trustee, to execute and deliver to the Trustee an instrument in which such agent
shall agree with the Trustee, subject to the provisions of this Section 4.04,
(i) that it will hold all sums held by it as such agent for
the payment of the principal of, and premium, if any, or interest on,
the Debt Securities of any series (whether such sums have been paid to
it by the Partnership or by any other obligor on the Debt Securities of
such series) in trust for the benefit of the Holders of the Debt
Securities of such series;
(ii) that it will give the Trustee notice of any failure by
the Partnership (or by any other obligor on the Debt Securities of such
series) to make any payment of the principal of and premium, if any, or
interest on, the Debt Securities of such series when the same shall be
due and payable; and
(iii) that it will at any time during the continuance of an
Event of Default, upon the written request of the Trustee, forthwith
pay to the Trustee all sums so held by it as such agent.
If the Partnership or any of its Subsidiaries shall act as its own
paying agent, it will, on or before each due date of the principal of, and
premium, if any, or interest on, the Debt Securities if any, of any series, set
aside, segregate and hold in trust for the benefit of the Holders of the Debt
Securities of such series a sum sufficient to pay such principal, premium, if
any, or interest so becoming due. The Partnership will promptly notify the
Trustee of any failure by the Partnership or its Subsidiaries to take such
action or the failure by any other obligor on such Debt Securities to make any
payment of the principal of, and premium, if any, or interest on, such Debt
Securities when the same shall be due and payable.
Anything in this Section 4.04 to the contrary notwithstanding, the
Partnership may, at any time, for the purpose of obtaining a satisfaction and
discharge of this Indenture, or for any other reason, pay or cause to be paid to
the Trustee all sums held in trust by it or any paying agent, as required by
this Section 4.04, such sums to be held by the Trustee upon the same trusts as
those upon which such sums were held by the Partnership or such paying agent.
Whenever the Partnership shall have one or more paying agents with
respect to any series of Debt Securities, it will, prior to each due date of the
principal of, and premium, if any, or interest on, any Debt Securities of such
series, deposit with any such paying agent a sum sufficient to pay the
principal, premium or interest so becoming due, such sum to be held in trust for
the benefit of the Persons entitled thereto, and (unless any such paying agent
is the Trustee) the Partnership will promptly notify the Trustee of its action
or failure so to act.
Anything in this Section 4.04 to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section 4.04 is subject to
the provisions of Section 11.05.
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Subordinated Indenture
Unless and until otherwise determined by the Partnership in Board
Resolutions, the Trustee will act as paying agent under this Indenture. The
Partnership may designate a substitute paying agent without prior notice to the
Holders of Debt Securities.
SECTION 4.05. STATEMENT BY OFFICERS AS TO DEFAULT.
The Partnership will deliver to the Trustee, on or before a date not
more than four months after the end of each fiscal year of the Partnership
(currently ending on December 31 of each year) ending after the date hereof, an
Officers' Certificate stating, as to each officer signing such certificate, that
(i) in the course of his performance of his duties as an officer of the General
Partner, he would normally have knowledge of any Default, (ii) whether or not to
the best of his knowledge any Default occurred during such year and (iii) if to
the best of his knowledge the Partnership, is in Default, specifying all such
Defaults and what action the Partnership is taking or proposes to take with
respect thereto. The Partnership also shall comply with Section 314(a)(4) of the
Trust Indenture Act.
SECTION 4.06. FURTHER INSTRUMENTS AND ACTS.
The Partnership will, upon request of the Trustee, execute and deliver
such further instruments and do such further acts as may reasonably be necessary
or proper to carry out more effectually the purposes of this Indenture.
SECTION 4.07. CORPORATE, PARTNERSHIP OR LIMITED LIABILITY COMPANY
EXISTENCE.
Subject to Article 10, the Partnership shall do or cause to be done all
things necessary to preserve and keep in full force and effect the corporate
existence and related rights and franchises (charges and statutory) of the
Partnership and each of its Subsidiaries; provided, however, that the
Partnership shall not be required to preserve any such right or franchise for
the corporate, partnership or limited liability company existence of any such
Subsidiary if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Partnership
and its Subsidiaries as a whole and that the loss thereof would not reasonably
be expected to have a material adverse effect on the ability of the Partnership
or any obligor on the Debt Securities of any series to perform their obligations
hereunder; and provided, further, however, that the foregoing shall not prohibit
a sale, transfer or conveyance of a Subsidiary of the Partnership or any of its
assets in compliance with the terms of this Indenture.
SECTION 4.08. MAINTENANCE OF PROPERTIES.
The Partnership shall cause all material properties owned by the
Partnership or any of its Subsidiaries or used or held for use in the conduct of
its business or the business of any of its Subsidiaries to be maintained and
kept in good condition, repair and working order (ordinary wear and tear
excepted) and supplied with all necessary equipment and will cause to be made
all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in the reasonable judgment of the Partnership may be consistent
with sound business practice and necessary so that the business carried on in
connection therewith may be properly conducted at all times; provided, however,
that nothing in this Section shall prevent the Partnership from discontinuing
the maintenance of any of such properties if such discontinuance is, in the
reasonable judgment of the Board of Directors, desirable in the conduct of its
business or the business of any of its Subsidiaries and not reasonably expected
to have a material adverse effect on the ability of the Partnership or any
obligor on the Debt Securities of any series to perform their obligations
hereunder.
31
Subordinated Indenture
SECTION 4.09. PAYMENT OF TAXES AND OTHER CLAIMS.
The Partnership shall pay or discharge or cause to be paid or
discharged, on or before the date the same shall become due and payable, (i) all
taxes, assessments and governmental charges levied or imposed upon the
Partnership or any of its Subsidiaries or otherwise assessed or upon the income,
profits or property of the Partnership or any of its Subsidiaries if failure to
pay or discharge the same could reasonably be expected to have a material
adverse effect on the ability of the Partnership or any obligor on the Debt
Securities of any series to perform their obligations hereunder and (ii) all
lawful claims for labor, materials and supplies, which, if unpaid, would by law
become a Lien upon the property of the Partnership or any of its Subsidiaries,
except for any Lien permitted to be incurred under the terms of this Indenture,
if failure to pay or discharge the same could reasonably be expected to have a
material adverse effect on the ability of the Partnership or any obligor on the
Debt Securities of any series to perform their obligations hereunder; provided,
however, that the Partnership shall not be required to pay or discharge or cause
to be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings properly instituted and diligently conducted and in respect of which
appropriate reserves (in the good faith judgment of management of the General
Partner) are being maintained in accordance with GAAP.
SECTION 4.10. CALCULATION OF ORIGINAL ISSUE DISCOUNT.
The Partnership shall file with the Trustee promptly at the end of each
calendar year (i) a written notice specifying the amount of original issue
discount (including daily rates and accrual periods) accrued on Outstanding
Original Issue Discount Debt Securities as of the end of such year and (ii) such
other specific information relating to such original issue discount as may then
be relevant under the Code.
SECTION 4.11. STAY, EXTENSION AND USURY LAWS.
The Partnership covenants (to the extent that it may lawfully do so)
that it 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 Partnership hereby
expressly waives all benefit or advantage of any such law, and covenants that it
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.
ARTICLE 5
HOLDERS' LISTS AND REPORTS
BY THE PARTNERSHIP AND THE TRUSTEE
SECTION 5.01. THE PARTNERSHIP TO FURNISH THE TRUSTEE INFORMATION AS TO
NAMES AND ADDRESSES OF HOLDERS; PRESERVATION OF INFORMATION.
The Partnership covenants and agrees that it will furnish or cause to
be furnished to the Trustee with respect to the Registered Securities of each
series:
32
Subordinated Indenture
(i) not more than 15 days after each record date with respect
to the payment of interest, if any, a list, in such form as the Trustee
may reasonably require, of the names and addresses of the Registered
Holders as of such record date; and
(ii) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Partnership of any
such request, a list as of a date not more than 15 days prior to the
time such list is furnished;
provided, however, that so long as the Trustee shall be the Registrar, such
lists shall not be required to be furnished.
The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the Holders (i)
contained in the most recent list furnished to it as provided in this Section
5.01 or (ii) received by it in the capacity of paying agent or Registrar (if so
acting) hereunder.
The Trustee may destroy any list furnished to it as provided in this
Section 5.01 upon receipt of a new list so furnished.
SECTION 5.02. COMMUNICATIONS TO HOLDERS; MEETINGS OF HOLDERS.
Holders may communicate pursuant to Section 312(b) of the Trust
Indenture Act with other Holders with respect to their rights under this
Indenture or the Debt Securities. The Partnership, the Trustee, the Registrar
and anyone else shall have the protection of Section 312(c) of the Trust
Indenture Act.
A meeting of the Holders of Debt Securities of any or all series may be
called at any time and from time to time pursuant to this Section 5.02 to make,
give or take any request, demand, authorization, direction, notice, consent,
waiver or other action provided herein to be made, given or taken by Holders of
Debt Securities of such series.
The Trustee may at any time call a meeting of Holders of Debt
Securities of any series for any purpose specified herein to be held at such
time and at such place in ___________, Texas, in The Borough of Manhattan, The
City of New York or in any other location, as the Trustee shall determine.
Notice of every meeting of Holders of any series, setting forth the time and the
place of such meeting and in general terms the action proposed to be taken at
such meeting, shall be given not less than 20 nor more than 180 days prior to
the date fixed for the meeting.
In case at any time the Partnership, pursuant to Board Resolutions, or
the Holders of at least 10% in aggregate principal amount of the outstanding
Debt Securities of any series, shall have requested the Trustee for any such
series to call a meeting of the Holders of Debt Securities of such series for
any purpose specified herein, by written request setting forth in reasonable
detail the action proposed to be taken at the meeting, and the Trustee shall not
have made the first publication of the notice of such meeting within 30 days
after receipt of such request or shall not thereafter proceed to cause the
meeting to be held as provided herein, then the Partnership or the Holders of
such series in the amount specified above, as the case may be, may determine the
time and the place in Richardson, Texas, in The Borough of Manhattan, The City
of New York, or in any other location, for such meeting and may call such
meeting for such purposes by giving notice thereof as provided in the third
paragraph of this Section 5.02.
33
Subordinated Indenture
SECTION 5.03. REPORTS BY THE PARTNERSHIP.
Notwithstanding that the Partnership may not be required to remain
subject to the reporting requirements of Sections 13 or 15(d) of the Exchange
Act, the Partnership shall file with the Commission and provide to the Trustee
and the Holders of Debt Securities the annual reports and the information,
documents and other reports that are specified in Sections 13 and 15(d) of the
Exchange Act, and, with respect to the annual consolidated financial statements
only, a report thereon by the Partnership's independent auditors; provided,
however, that the Partnership shall not be so obligated to file such
information, documents and reports with the Commission if the Commission does
not permit such filings. The Partnership shall comply with the other provisions
of Section 314(a) of the Trust Indenture Act.
The Partnership covenants and agrees, and any obligor hereunder shall
covenant and agree, to file with the Trustee and the Commission, in accordance
with the rules and regulations prescribed from time to time by said Commission,
such additional information, documents, and reports with respect to compliance
by the Partnership or such obligor, as the case may be, with the conditions and
covenants provided for in this Indenture as may be required from time to time by
such rules and regulations.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only, and the Trustee's receipt of such shall not
constitute notice of any information contained therein or determinable from
information contained therein, including the Partnership's compliance with any
of their covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers' Certificates).
SECTION 5.04. REPORTS BY THE TRUSTEE.
The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the time and in the manner provided pursuant thereto.
Reports pursuant to this Section 5.04 shall be transmitted by mail:
(i) to all Registered Holders, as the names and addresses of
such Holders appear in the Debt Security Register; and
(ii) except in the cases of reports under Section 313(b)(2) of
the Trust Indenture Act, to each holder of a Debt Security of any
series whose name and address appear in the information preserved at
the time by the Trustee in accordance with Section 5.02.
A copy of each report at the time of its mailing to Holders shall be
filed with the Commission and each stock exchange (if any) on which the Debt
Securities of any series are listed. The Partnership agrees to notify promptly
the Trustee whenever the Debt Securities of any series become listed on any
stock exchange and of any delisting thereof.
SECTION 5.05. RECORD DATES FOR ACTION BY HOLDERS.
If the Partnership shall solicit from the Holders of Debt Securities of
any series any action (including the making of any demand or request, the giving
of any direction, notice, consent or waiver or the taking of any other action),
the Partnership may, at its option, by Board
34
Subordinated Indenture
Resolutions, fix in advance a record date for the determination of Holders of
Debt Securities entitled to take such action, but the Partnership shall have no
obligation to do so. Any such record date shall be fixed at the Partnership's
discretion. If such a record date is fixed, such action may be sought or given
before or after the record date, but only the Holders of Debt Securities of
record at the close of business on such record date shall be deemed to be
Holders of Debt Securities for the purpose of determining whether Holders of the
requisite proportion of Debt Securities of such series Outstanding have
authorized or agreed or consented to such action, and for that purpose the Debt
Securities of such series Outstanding shall be computed as of such record date.
ARTICLE 6
REMEDIES OF THE TRUSTEE AND HOLDERS IN EVENT OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT.
If any one or more of the following shall have occurred and be
continuing with respect to Debt Securities of any series (each of the following,
an "EVENT OF DEFAULT"):
(a) the Partnership defaults for a period of 60 days in the
payment when due of interest on any Debt Securities of that series,
whether or not such payment shall be prohibited by Article 12, if
applicable; or
(b) the Partnership defaults in the payment when due of
principal of or premium, if any, on any Debt Securities of that series
at maturity, upon redemption or otherwise, whether or not such payment
shall be prohibited by Article 12, if applicable; or
(c) default in the payment of any sinking fund payment with
respect to any Debt Securities of that series as and when the same
shall become due and payable; or
(d) failure on the part of the Partnership to comply with
Article 10; or
(e) failure by the Partnership for 60 days after its receipt
of notice to comply from the Trustee or the Holders of at least 25% in
principal amount of the Outstanding Debt Securities of that series to
duly observe or perform any other of the covenants or agreements on the
part of the Partnership in the Debt Securities of that series in any
Board Resolution authorizing the issuance of that series of Debt
Securities, in this Indenture with respect to such series or in any
supplemental Indenture with respect to such series (other than a
covenant a default in the performance of which is elsewhere in this
Section 6.01 specifically dealt with); or
(f) pursuant to or within the meaning of Bankruptcy Law, the
Partnership commences a voluntary case, consents to the entry of an
order for relief against it in an involuntary case, consents to the
appointment of a custodian of it or for all or substantially all of its
property, makes a general assignment for the benefit of its creditors,
or generally is not paying its debts as they become due; or
(g) (i) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that is for relief against the
Partnership in an involuntary case, appoints a custodian of the
Partnership, or orders the liquidation of the Partnership and (ii) such
order or decree remains unstayed and in effect for 60 consecutive days;
or
35
Subordinated Indenture
(h) any other Event of Default provided under the terms of the
Debt Securities of that series;
then and in each and every case that an Event of Default with respect to Debt
Securities of that series at the time Outstanding occurs and is continuing, by
notice to the Partnership either the Trustee or the Holders of at least 25% in
aggregate principal amount of the Debt Securities of that series then
Outstanding, may declare the principal of (or, if the Debt Securities of that
series are Original Issue Discount Debt Securities, such portion of the
principal amount as may be specified in the terms of that series), and the
premium, if any, and accrued interest on, all the Debt Securities of that series
to be due and payable immediately.
The Holders of a majority in principal amount of the Debt Securities of
a particular series by notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
already rendered and if all existing Events of Default have been cured or waived
except nonpayment of principal or interest that has become due solely because of
acceleration. Upon any such rescission, the parties hereto shall be restored
respectively to their several positions and rights hereunder, and all rights,
remedies and powers of the parties hereto shall continue as though no proceeding
had been taken.
In case the Trustee or any Holder shall have proceeded to enforce any
right under this Indenture and such proceedings shall have been discontinued or
abandoned because of such rescission or annulment or for any other reason or
shall have been determined adversely to the Trustee or such Holder, then and in
every such case the parties hereto shall be restored respectively to their
several positions and rights hereunder, and all rights, remedies and powers of
the parties hereto shall continue as though no such proceeding had been taken.
The foregoing Events of Default shall constitute Events of Default
whatever the reason for any such Event of Default and whether it is voluntary or
involuntary or is effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body.
The Partnership shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Event of Default under clause (c), (d), (e), (f), (g) or (h), its status and
what action the Partnership is taking or proposes to take with respect to the
Event of Default.
SECTION 6.02. COLLECTION OF INDEBTEDNESS BY TRUSTEE, ETC.
If an Event of Default occurs and is continuing, the Trustee, in its
own name and as trustee of an express trust, shall be entitled and empowered to
institute any action or proceedings at law or in equity for the collection of
the sums so due and unpaid or enforce the performance of any provision of the
Debt Securities of the affected series or this Indenture, and may prosecute any
such action or proceedings to judgment or final decree, and may enforce any such
judgment or final decree against the Partnership or any other obligor upon the
Debt Securities of such series (and collect in the manner provided by law out of
the property of the Partnership or any other obligor upon the Debt Securities of
such series wherever situated the moneys adjudged or decreed to be payable).
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Partnership or any other obligor upon the Debt
Securities of any series under Title 11 of the United States Code or any other
Federal or State bankruptcy, insolvency or similar law, or in case
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Subordinated Indenture
a receiver, trustee or other similar official shall have been appointed for its
property, or in case of any other similar judicial proceedings relative to the
Partnership or any other obligor upon the Debt Securities of any series, its
creditors or its property, the Trustee, irrespective of whether the principal of
Debt Securities of any series shall then be due and payable as therein expressed
or by declaration or otherwise and irrespective of whether the Trustee shall
have made any demand pursuant to the provisions of this Section 6.02, shall be
entitled and empowered, by intervention in such proceedings or otherwise, to
file and prove a claim or claims for the whole amount of principal, premium, if
any, and interest (or, if the Debt Securities of such series are Original Issue
Discount Debt Securities, such portion of the principal amount as may be
specified in the terms of such series) owing and unpaid in respect of the Debt
Securities of such series, and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee (including any
claim for reasonable compensation to the Trustee, its agents, attorneys and
counsel, and for reimbursement of all expenses and liabilities incurred, and all
advances made, by the Trustee except as a result of its negligence or bad faith)
and of the Holders thereof allowed in any such judicial proceedings relative to
the Partnership, or any other obligor upon the Debt Securities of such series,
its creditors or its property, and to collect and receive any moneys or other
property payable or deliverable on any such claims, and to distribute all
amounts received with respect to the claims of such Holders and of the Trustee
on their behalf, and any receiver, assignee or trustee in bankruptcy or
reorganization is hereby authorized by each of such Holders to make payments to
the Trustee, and, in the event that the Trustee shall consent to the making of
payments directly to such Holders, to pay to the Trustee such amount as shall be
sufficient to cover reasonable compensation to the Trustee, its agents,
attorneys and counsel, and all other reasonable expenses and liabilities
incurred, and all advances made, by the Trustee except as a result of its
negligence or bad faith.
All rights of action and of asserting claims under this Indenture, or
under any of the Debt Securities, of any series, may be enforced by the Trustee
without the possession of any such Debt Securities or the production thereof in
any trial or other proceedings relative thereto, and any such action or
proceedings instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment (except for any
amounts payable to the Trustee pursuant to Section 7.06) shall be for the
ratable benefit of the Holders of all the Debt Securities in respect of which
such action was taken.
In case of an Event of Default hereunder the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee shall deem
necessary to protect and enforce any of such rights, either at law or in equity
or in bankruptcy or otherwise, whether for the specific enforcement of any
covenant or agreement contained in this Indenture or in aid of the exercise of
any power granted in this Indenture, or to enforce any other legal or equitable
right vested in the Trustee by this Indenture or by law.
SECTION 6.03. APPLICATION OF MONEYS COLLECTED BY TRUSTEE.
Any moneys or other property collected by the Trustee pursuant to
Section 6.02 with respect to Debt Securities of any series shall be applied,
after giving effect to the provisions of Article 12, if applicable, in the order
following, at the date or dates fixed by the Trustee for the distribution of
such moneys or other property, upon presentation of the several Debt Securities
of such series in respect of which moneys or other property have been collected,
and the notation thereon of the payment, if only partially paid, and upon
surrender thereof if fully paid:
First: To the payment of all money due the Trustee pursuant to
Section 7.06;
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Subordinated Indenture
Second: In case the principal of the Outstanding Debt
Securities in respect of which such moneys have been collected shall
not have become due, to the payment of interest on the Debt Securities
of such series in the order of the maturity of the installments of such
interest, with interest (to the extent that such interest has been
collected by the Trustee) upon the overdue installments of interest at
the rate or Yield to Maturity (in the case of Original Issue Discount
Debt Securities) borne by the Debt Securities of such series, such
payments to be made ratably to the Persons entitled thereto, without
discrimination or preference;
Third: In case the principal of the Outstanding Debt
Securities in respect of which such moneys have been collected shall
have become due, by declaration or otherwise, to the payment of the
whole amount then owing and unpaid upon the Debt Securities of such
series for principal and premium, if any, and interest, with interest
on the overdue principal and premium, if any, and (to the extent that
such interest has been collected by the Trustee) upon overdue
installments of interest at the rate or Yield to Maturity (in the case
of Original Issue Discount Debt Securities) borne by the Debt
Securities of such series; and, in case such moneys shall be
insufficient to pay in full the whole amount so due and unpaid upon the
Debt Securities of such series, then to the payment of such principal
and premium, if any, and interest, without preference or priority of
principal and premium, if any, over interest, or of interest over
principal and premium, if any, or of any installment of interest over
any other installment of interest, or of any Debt Security of such
series over any Debt Security of such series, ratably to the aggregate
of such principal and premium, if any, and interest; and
Fourth: The remainder, if any, shall be paid to the
Partnership, its successors or assigns, or as a court of competent
jurisdiction may direct.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 6.03. At least 15 days before such record date,
the Partnership shall mail to each Holder and the Trustee a notice that states
the record date, the payment date and amount to be paid.
SECTION 6.04. LIMITATION ON SUITS BY HOLDERS.
No Holder of any Debt Security of any series shall have any right by
virtue or by availing of any provision of this Indenture to institute any action
or proceeding at law or in equity or in bankruptcy or otherwise, upon or under
or with respect to this Indenture, or for the appointment of a receiver or
trustee, or for any other remedy hereunder, unless such Holder previously shall
have given to the Trustee written notice of an Event of Default with respect to
Debt Securities of that same series and of the continuance thereof and unless
the Holders of not less than 25% in aggregate principal amount of the
Outstanding Debt Securities of that series shall have made written request upon
the Trustee to institute such action or proceedings in respect of such Event of
Default in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the loss, expenses
and liabilities to be incurred therein or thereby, and the Trustee, for 60 days
after its receipt of such notice, request and offer of indemnity shall have
failed to institute any such action or proceedings and no direction inconsistent
with such written request shall have been given to the Trustee pursuant to
Section 6.06; it being understood and intended, and being expressly covenanted
by the Holder of every Debt Security with every other Holder and the Trustee,
that no one or more Holders shall have any right in any manner whatever by
virtue or by availing of any provision of this Indenture to affect, disturb or
prejudice the rights of any Holders, or to obtain or seek to obtain priority
over
38
Subordinated Indenture
or preference to any other such Holder, or to enforce any right under this
Indenture, except in the manner herein provided and for the equal, ratable and
common benefit of all such Holders. For the protection and enforcement of the
provisions of this Section 6.04, each and every Holder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
Notwithstanding any other provision in this Indenture, however, the
right of any Holder of any Debt Security to receive payment of the principal of,
and premium, if any, and (subject to Section 2.12) interest on, such Debt
Security on or after the respective due dates expressed in such Debt Security,
and to institute 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.
SECTION 6.05. REMEDIES CUMULATIVE; DELAY OR OMISSION IN EXERCISE OF
RIGHTS NOT A WAIVER OF DEFAULT.
All powers and remedies given by this Article 6 to the Trustee or to
the Holders shall, to the extent permitted by law, be deemed cumulative and not
exclusive of any thereof or of any other powers and remedies available to the
Trustee or the Holders, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this
Indenture, and no delay or omission of the Trustee or of any Holder to exercise
any right or power accruing upon any Default occurring and continuing as
aforesaid, shall impair any such right or power, or shall be construed to be a
waiver of any such Default or an acquiescence therein; and, subject to the
provisions of Section 6.04, every power and remedy given by this Article 6 or by
law to the Trustee or to the Holders may be exercised from time to time, and as
often as shall be deemed expedient, by the Trustee or by the Holders.
SECTION 6.06. RIGHTS OF HOLDERS OF MAJORITY IN PRINCIPAL AMOUNT OF DEBT
SECURITIES TO DIRECT TRUSTEE AND TO WAIVE DEFAULT.
The Holders of a majority in aggregate principal amount of the Debt
Securities of any series at the time Outstanding shall have the right to direct
the time, method, and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee, with respect to the Debt Securities of such series; provided, however,
that such direction shall not be otherwise than in accordance with law and the
provisions of this Indenture, and that subject to the provisions of Section
7.01, the Trustee shall have the right to decline to follow any such direction
if the Trustee being advised by counsel shall determine that the action so
directed may not lawfully be taken, or if the Trustee shall by a Responsible
Officer or officers determine that the action so directed would involve it in
personal liability or would be prejudicial to Holders of Debt Securities of such
series not taking part in such direction; and provided further, however, that
nothing in this Indenture contained shall impair the right of the Trustee to
take any action deemed proper by the Trustee and which is not inconsistent with
such direction by such Holders. Prior to the acceleration of the maturity of the
Debt Securities of any series, as provided in Section 6.01, the Holders of a
majority in aggregate principal amount of the Debt Securities of that series at
the time Outstanding may on behalf of the Holders of all the Debt Securities of
that series waive any past Default or Event of Default and its consequences for
that series specified in the terms thereof as contemplated by Section 2.03,
except (i) a Default in the payment of the principal of, and premium, if any, or
interest on, any of the Debt Securities and (ii) a Default in respect of a
provision that under Section 9.02 cannot be amended without the consent of each
Holder affected thereby. In case of any such waiver, such Default shall cease to
exist, any Event of Default arising therefrom shall be deemed to have been cured
for every purpose of this Indenture, and the Partnership, the Trustee and the
Holders of the Debt Securities of that series shall be restored to their former
positions and rights hereunder,
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Subordinated Indenture
respectively; but no such waiver shall extend to any subsequent or other Default
or impair any right consequent thereon.
SECTION 6.07. TRUSTEE TO GIVE NOTICE OF DEFAULTS KNOWN TO IT, BUT MAY
WITHHOLD SUCH NOTICE IN CERTAIN CIRCUMSTANCES.
The Trustee shall, within 90 days after the occurrence of a Default
known to it with respect to a series of Debt Securities give to the Holders
thereof, in the manner provided in Section 1.07, notice of all Defaults with
respect to such series known to the Trustee, unless such Defaults shall have
been cured or waived before the giving of such notice; provided that, except in
the case of Default in the payment of the principal of, or premium, if any, or
interest on, any of the Debt Securities of such series or in the making of any
sinking fund payment with respect to the Debt Securities of such series, the
Trustee shall be protected in withholding such notice if and so long as the
committee of Responsible Officers of the Trustee in good faith determine that
the withholding of such notice is in the interests of the Holders thereof.
SECTION 6.08. REQUIREMENT OF AN UNDERTAKING TO PAY COSTS IN CERTAIN
SUITS UNDER THIS INDENTURE OR AGAINST THE TRUSTEE.
All parties to this Indenture agree, and each Holder of any Debt
Security by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, 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 Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit in the manner and to
the extent provided in the Trust Indenture Act, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 6.08 shall not apply to any suit instituted by
the Trustee, to any suit instituted by any Holder, or group of Holders, holding
in the aggregate more than twenty-five percent in principal amount of the
Outstanding Debt Securities of that series or to any suit instituted by any
Holder for the enforcement of the payment of the principal of, or premium, if
any, or interest on, any Debt Security on or after the due date for such payment
expressed in such Debt Security.
ARTICLE 7
CONCERNING THE TRUSTEE
SECTION 7.01. CERTAIN DUTIES AND RESPONSIBILITIES.
The Trustee, prior to the occurrence of an Event of Default and after
the curing or waiving of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Indenture. In case an Event of Default has occurred (which has not
been cured or waived), the Trustee shall exercise such of the rights and powers
vested in it by this Indenture, and use the same degree of care and skill in
their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that:
40
Subordinated Indenture
(i) this subsection shall not be construed to limit the effect
of the first paragraph of this Section 7.01;
(ii) prior to the occurrence of an Event of Default with
respect to the Debt Securities of a series and after the curing or
waiving of all Events of Default with respect to such series which may
have occurred:
(a) the duties and obligations of the Trustee with
respect to Debt Securities of any series shall be determined
solely by the express provisions of this Indenture, and the
Trustee shall not be liable except for the performance of such
duties and obligations with respect to such series as are
specifically set forth in this Indenture, and no implied
covenants or obligations with respect to such series shall be
read into this Indenture against the Trustee; and
(b) in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture;
but in the case of any such certificates or opinions which by
any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine
the same to determine whether or not they conform to the
requirements of this Indenture;
(iii) the Trustee shall not be liable for an error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts; and
(iv) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it with respect to Debt
Securities of any series in good faith in accordance with the direction
of the Holders of not less than a majority in aggregate principal
amount of the Outstanding Debt Securities of that series relating to
the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Indenture with respect to Debt Securities
of such series.
None of the provisions of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any personal financial liability
in the performance of any of its duties hereunder, or in the exercise of any of
its rights or powers, if there shall be reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
SECTION 7.02. CERTAIN RIGHTS OF TRUSTEE.
Except as otherwise provided in Section 7.01:
(i) the Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion,
41
Subordinated Indenture
report, notice, request, direction, consent, order, bond, debenture,
note or other paper or document (whether in its original or facsimile
form) believed by it to be genuine and to have been signed or presented
by the proper party or parties;
(ii) any request, direction, order or demand of the
Partnership mentioned herein shall be sufficiently evidenced by an
Issuer Order (unless other evidence in respect thereof be herein
specifically prescribed); and any Board Resolution may be evidenced to
the Trustee by a copy thereof certified by the Secretary or an
Assistant Secretary of the General Partner;
(iii) the Trustee may consult with counsel of its own
selection, and the advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in respect of
any action taken or suffered or omitted by it hereunder in good faith
and in accordance with such advice or Opinion of Counsel;
(iv) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request,
order or direction of any of the Holders of Debt Securities of any
series pursuant to the provisions of this Indenture, unless such
Holders shall have offered to the Trustee security or indemnity
reasonably satisfactory to it against the loss, expenses and
liabilities which may be incurred therein or thereby;
(v) the Trustee shall not be liable for any action taken or
omitted by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Indenture;
(vi) prior to the occurrence of an Event of Default and after
the curing of all Events of Default which may have occurred, 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, approval
or other paper or document, unless requested in writing to do so by the
Holders of a majority in aggregate principal amount of the then
outstanding Debt Securities of a series affected by such matter;
provided, however, that if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be incurred by
it in the making of such investigation is not, in the opinion of the
Trustee, reasonably assured to the Trustee by the security afforded to
it by the terms of this Indenture, the Trustee may require indemnity
reasonably satisfactory to it against such costs, expenses or
liabilities as a condition to so proceeding; the Trustee shall be
entitled to examine the books, records and premises of the Partnership,
personally or by an agent or attorney at the sole cost of the
Partnership and shall incur no liability or additional liability of any
kind by reason of such inquiry or investigation;
(vii) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed by it with due care hereunder;
(viii) if any property other than cash shall at any time be
subject to a Lien in favor of the Holders, the Trustee, if and to the
extent authorized by a receivership or bankruptcy court of competent
jurisdiction or by the supplemental instrument subjecting such property
to such Lien, shall be entitled to make advances for the purpose of
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Subordinated Indenture
preserving such property or of discharging tax Liens or other prior
Liens or encumbrances thereon; and
(ix) the Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Responsible Officer of the Trustee
has actual knowledge thereof or unless written notice of any event
which is in fact such a Default is received by the Trustee at the
Corporate Trust Office of the Trustee, and such notice references the
Debt Securities and this Indenture; and
(x) the rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right
to be indemnified, are extended to, and shall be enforceable by, the
Trustee in each of its capacities hereunder, and to each agent,
custodian and other Person employed by the Trustee to act hereunder.
SECTION 7.03. TRUSTEE NOT LIABLE FOR RECITALS IN INDENTURE OR IN DEBT
SECURITIES.
The recitals contained herein and in the Debt Securities (except the
Trustee's certificate of authentication) shall be taken as the statements of the
Partnership, and the Trustee assumes no responsibility for the correctness of
the same. The Trustee makes no representations as to the validity or sufficiency
of this Indenture or of the Debt Securities of any series, except that the
Trustee represents that it is duly authorized to execute and deliver this
Indenture, authenticate the Debt Securities and perform its obligations
hereunder, and that the statements made by it or to be made by it in a Statement
of Eligibility and Qualification on Form T-1 supplied to the Partnership are
true and accurate. The Trustee shall not be accountable for the use or
application by the Partnership of any of the Debt Securities or of the proceeds
thereof.
SECTION 7.04. TRUSTEE, PAYING AGENT OR REGISTRAR MAY OWN DEBT
SECURITIES.
The Trustee or any paying agent or Registrar, in its individual or any
other capacity, may become the owner or pledgee of Debt Securities and subject
to the provisions of the Trust Indenture Act relating to conflicts of interest
and preferential claims may otherwise deal with the Partnership with the same
rights it would have if it were not Trustee, paying agent or Registrar;
provided, however, that if the Trustee acquires any such conflicting interest
and an Event of Default or Default has occurred and is continuing, the Trustee
must eliminate such conflict within 90 days, apply to the Commission for
permission to continue as trustee or resign.
SECTION 7.05. MONEYS RECEIVED BY TRUSTEE TO BE HELD IN TRUST.
Subject to the provisions of Section 11.05, all moneys received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for interest on any moneys received by it hereunder. So long as no
Event of Default shall have occurred and be continuing, all interest allowed on
any such moneys shall be paid from time to time to the Partnership upon an
Issuer Order.
SECTION 7.06. COMPENSATION AND REIMBURSEMENT.
The Partnership covenants and agrees to pay in Dollars to the Trustee
from time to time, and the Trustee shall be entitled to, reasonable compensation
for all services rendered by it hereunder (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust), and, except as otherwise expressly provided herein, the Partnership
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Subordinated Indenture
will pay or reimburse in Dollars the Trustee upon its request for all expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any of the provisions of this Indenture (including the reasonable compensation
and the expenses and disbursements of its agents, attorneys and counsel and of
all Persons not regularly in its employ) except any such expense, disbursement
or advances as may arise from its negligence or bad faith. The Partnership also
covenants to fully indemnify in Dollars the Trustee and any predecessor Trustee
for, and to hold it harmless against, any and all loss, liability, claim, damage
or expense incurred without negligence or willful misconduct on the part of the
Trustee, arising out of or in connection with the acceptance or administration
of this trust or trusts hereunder, including the costs and expenses of defending
itself against any claim of liability in connection with the exercise or
performance of any of its powers or duties hereunder. The obligations of the
Partnership under this Section 7.06 to compensate and indemnify the Trustee and
to pay or reimburse the Trustee for expenses, disbursements and advances shall
constitute additional indebtedness hereunder and shall survive the satisfaction
and discharge of this Indenture. The Partnership and the Holders agree that such
additional indebtedness shall be secured by a Lien prior to that of the Debt
Securities upon all property and funds held or collected by the Trustee, as
such, except funds held in trust for the payment of principal of, and premium,
if any, or interest on, particular Debt Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(g) or (h) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any bankruptcy, insolvency, reorganization or other similar
law.
SECTION 7.07. RIGHT OF TRUSTEE TO RELY ON AN OFFICERS' CERTIFICATE
WHERE NO OTHER EVIDENCE SPECIFICALLY PRESCRIBED.
Except as otherwise provided in Section 7.01, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
suffering or omitting any action hereunder, such matter (unless other evidence
in respect thereof be herein specifically prescribed) may, in the absence of
negligence or bad faith on the part of the Trustee, be deemed to be conclusively
proved and established by an Officers' Certificate delivered to the Trustee and
such certificate, in the absence of negligence or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action taken, suffered or
omitted by it under the provisions of this Indenture upon the faith thereof.
SECTION 7.08. SEPARATE TRUSTEE; REPLACEMENT OF TRUSTEE.
The Partnership may, but need not, appoint a separate Trustee for any
one or more series of Debt Securities. The Trustee may resign with respect to
one or more or all series of Debt Securities at any time by giving notice to the
Partnership. The Holders of a majority in principal amount of the Debt
Securities of a particular series may remove the Trustee for such series and
only such series by so notifying the Trustee and may appoint a successor
Trustee. The Partnership shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the
Trustee or its property; or
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Subordinated Indenture
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Partnership or by the Holders
of a majority in principal amount of the Debt Securities of a particular series
and such Holders do not reasonably promptly appoint a successor Trustee, or if a
vacancy exists in the office of Trustee for any reason (the Trustee in such
event being referred to herein as the retiring Trustee), the Partnership shall
promptly appoint a successor Trustee. No resignation or removal of the Trustee
and no appointment of a successor Trustee shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of this Section 7.08.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Partnership. 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 of Debt Securities of each applicable series. The retiring
Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee, subject to the Lien provided for in Section 7.06.
If a successor Trustee does not take office within 60 days after the
retiring Trustee gives notice of resignation or is removed, the retiring Trustee
or the Holders of 25% in principal amount of the Debt Securities of any
applicable series may petition any court of competent jurisdiction for the
appointment of a successor Trustee for the Debt Securities of such series.
If the Trustee fails to comply with Section 7.10, any Holder of Debt
Securities of any applicable series may petition at the expense of the
Partnership any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee for the Debt Securities of such
series.
Notwithstanding the replacement of the Trustee pursuant to this Section
7.08, the Partnership's obligations under Section 7.06 shall continue for the
benefit of the retiring Trustee.
In the case of the appointment hereunder of a separate or successor
trustee with respect to the Debt Securities of one or more series, the
Partnership, any retiring Trustee and each successor or separate Trustee with
respect to the Debt Securities of any applicable series shall execute and
deliver an Indenture supplemental hereto (i) which shall contain such provisions
as shall be deemed necessary or desirable to confirm that all the rights,
powers, trusts and duties of any retiring Trustee with respect to the Debt
Securities of any series as to which any such retiring Trustee is not retiring
shall continue to be vested in such retiring Trustee and (ii) that shall add to
or change any of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts hereunder by more
than one trustee, it being understood that nothing herein or in such
supplemental Indenture shall constitute such Trustees co-trustees of the same
trust and that each such separate, retiring or successor Trustee shall be
Trustee of a trust or trusts hereunder separate and apart from any trust or
trusts hereunder administered by any other such Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation or banking association without any further act shall be the
successor Trustee.
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Subordinated Indenture
In case at the time such successor or successors by merger, conversion
or consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Debt Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Debt Securities so
authenticated; and in case at that time any of the Debt Securities shall not
have been authenticated, any successor to the Trustee may authenticate such Debt
Securities either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Debt Securities or in this Indenture
provided that the certificate of the Trustee shall have.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
The Trustee shall at all times satisfy the requirements of Section
310(a) of the Trust Indenture Act. The Trustee shall have a combined capital and
surplus of at least $50,000,000, as set forth in its most recent published
annual report of condition. No obligor upon the Debt Securities of a particular
series or Person directly or indirectly controlling, controlled by or under
common control with such obligor shall serve as Trustee upon the Debt Securities
of such series. The Trustee shall comply with Section 310(b) of the Trust
Indenture Act; provided, however, that there shall be excluded from the
operation of Section 310(b)(1) of the Trust Indenture Act, this Indenture or any
indenture or indentures under which other securities or certificates of interest
or participation in other securities of the Partnership are outstanding if the
requirements for such exclusion set forth in Section 310(b)(1) of the Trust
Indenture Act are met.
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE
PARTNERSHIP.
The Trustee shall comply with Section 311(a) of the Trust Indenture
Act, excluding any creditor relationship listed in Section 311(b) of the Trust
Indenture Act. A Trustee who had resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent indicated therein.
SECTION 7.12. COMPLIANCE WITH TAX LAWS.
The Trustee hereby agrees to comply with all U.S. Federal income tax
information reporting and withholding requirements applicable to it with respect
to payments of premium (if any) and interest on the Debt Securities, whether
acting as Trustee, Security Registrar, paying agent or otherwise with respect to
the Debt Securities.
SECTION 7.13. TRUSTEE'S APPLICATION FOR INSTRUCTIONS FROM THE
PARTNERSHIP.
Any application by the Trustee for written instructions from the
Partnership may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. The Trustee shall not be liable for any action taken by, or omission
of, the Trustee in accordance with a proposal included in such application on or
after the date specified in such application (which date shall not be less than
three business days after the date any officer of the General Partner actually
receives such application, unless such officer shall have consented in writing
to any earlier date) unless prior to taking any such action (or the effective
date in the case of an omission), the Trustee shall have received written
instructions in response to such application specifying the action to be taken
or omitted.
46
Subordinated Indenture
ARTICLE 8
CONCERNING THE HOLDERS
SECTION 8.01. EVIDENCE OF ACTION BY HOLDERS.
Whenever in this Indenture it is provided that the Holders of a
specified percentage in aggregate principal amount of the Debt Securities of any
or all series may take action (including the making of any demand or request,
the giving of any direction, notice, consent or waiver or the taking of any
other action) the fact that at the time of taking any such action the Holders of
such specified percentage have joined therein may be evidenced (i) by any
instrument or any number of instruments of similar tenor executed by Holders in
person or by agent or proxy appointed in writing, (ii) by the record of the
Holders voting in favor thereof at any meeting of Holders duly called and held
in accordance with the provisions of Section 5.02 or (iii) by a combination of
such instrument or instruments and any such record of such a meeting of Holders.
SECTION 8.02. PROOF OF EXECUTION OF INSTRUMENTS AND OF HOLDING OF DEBT
SECURITIES.
Subject to the provisions of Sections 1.13, 7.01 and 7.02, proof of the
execution of any instrument by a Holder or his agent or proxy shall be
sufficient if made in accordance with such reasonable rules and regulations as
may be prescribed by the Trustee or in such manner as shall be satisfactory to
the Trustee.
The ownership of Registered Securities of any series shall be proved by
the Debt Security Register or by a certificate of the Registrar for such series.
The Trustee may require such additional proof of any matter referred to
in this Section 8.02 as it shall deem necessary.
SECTION 8.03. WHO MAY BE DEEMED OWNER OF DEBT SECURITIES.
Prior to due presentment for registration of transfer of any Registered
Security, the Partnership, the Trustee, any paying agent and any Registrar may
deem and treat the Person in whose name any Registered Security shall be
registered upon the books of the Partnership as the absolute owner of such
Registered Security (whether or not such Registered Security shall be overdue
and notwithstanding any notation of ownership or other writing thereon) for the
purpose of receiving payment of or on account of the principal of and premium,
if any, and (subject to Section 2.03) interest on such Registered Security and
for all other purposes, and neither the Partnership nor the Trustee nor any
paying agent nor any Registrar shall be affected by any notice to the contrary;
and all such payments so made to any such Holder for the time being, or upon his
order, shall be valid and, to the extent of the sum or sums so paid, effectual
to satisfy and discharge the liability for moneys payable upon any such
Registered Security.
None of the Partnership, the Trustee, any paying agent or the Registrar
will have any responsibility or liability for any aspect of the records relating
to or payments made on account of beneficial ownership interests in a Global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
SECTION 8.04. INSTRUMENTS EXECUTED BY HOLDERS BIND FUTURE HOLDERS.
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 8.01, of the taking of any action by the Holders of the
percentage in aggregate principal
47
Subordinated Indenture
amount of the Debt Securities of any series specified in this Indenture in
connection with such action and subject to the following paragraph, any Holder
of a Debt Security which is shown by the evidence to be included in the Debt
Securities the Holders of which have consented to such action may, by filing
written notice with the Trustee at its Corporate Trust Office of the Trustee and
upon proof of holding as provided in Section 8.02, revoke such action so far as
concerns such Debt Security. Except as aforesaid any such action taken by the
Holder of any Debt Security shall be conclusive and binding upon such Holder and
upon all future Holders and owners of such Debt Security and of any Debt
Security issued upon transfer thereof or in exchange or substitution therefor,
irrespective of whether or not any notation in regard thereto is made upon such
Debt Security or such other Debt Securities. Any action taken by the Holders of
the percentage in aggregate principal amount of the Debt Securities of any
series specified in this Indenture in connection with such action shall be
conclusively binding upon the Partnership, the Trustee and the Holders of all
the Debt Securities of such series.
The Partnership may, but shall not be obligated to, fix a record date
for the purpose of determining the Holders of Registered Securities entitled to
give their consent or take any other action 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 of Registered
Securities 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 of Registered Securities after such record date. No such
consent shall be valid or effective for more than 120 days after such record
date unless the written consent of the Holders of the percentage in aggregate
principal amount of the Debt Securities of such series specified in this
Indenture shall have been received within such 120-day period.
ARTICLE 9
SUPPLEMENTAL INDENTURES
SECTION 9.01. PURPOSES FOR WHICH SUPPLEMENTAL INDENTURE MAY BE ENTERED
INTO WITHOUT CONSENT OF HOLDERS.
The Partnership, when authorized by Board Resolutions, and the Trustee
may from time to time and at any time, without the consent of Holders, enter
into an Indenture or Indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as in force at the date of the execution
thereof) for one or more of the following purposes:
(a) to cure any ambiguity, defect, omission, error or
inconsistency contained herein, in any supplemental Indenture or in the
Debt Securities of such series;
(b) to provide for uncertificated Debt Securities in addition
to or in place of certificated Debt Securities; provided, however, that
the uncertificated Debt Securities are issued in registered form for
purposes of Section 163(f) of the Code of 1986, as amended from time to
time, or in a manner such that the uncertificated Debt Securities are
described in Section 163(f)(2)(B) of the Code;
(c) to evidence succession, or to provide for the assumption
of the Partnership's obligations to Holders, pursuant to Article 10;
48
Subordinated Indenture
(d) in the case of any Debt Securities subordinated pursuant
to Article 12, to make any change in Article 12 that would limit or
terminate the benefits available to any holder of Senior Indebtedness
(or Representatives therefor) under Article 12;
(e) to add guarantees with respect to any or all of the Debt
Securities or to secure any or all of the Debt Securities, or any
guarantees with respect thereto, in each case in accordance with the
provisions of this Indenture or any supplemental indenture;
(f) to make any changes that would provide any additional
rights or benefits to the Holders of the Debt Securities or that do
not, taken as a whole, adversely affect the legal rights hereunder of
any Holder;
(g) to comply with the requirements of the Commission to
permit the qualification of this Indenture or any Indenture
supplemental hereto under the Trust Indenture Act as then in effect,
except that nothing herein contained shall permit or authorize the
inclusion in any Indenture supplemental hereto of the provisions
referred to in Section 316(a)(2) of the Trust Indenture Act;
(h) to evidence and provide for the acceptance of appointment
hereunder by a successor or separate Trustee with respect to the Debt
Securities of one or more series and to add to or change any of the
provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one
Trustee;
(i) to add any additional Events of Default; and
(j) to release any guarantee or security with respect to any
or all of the Debt Securities, or any guarantees with respect thereto,
in each case in accordance with this Indenture or any supplemental
Indenture.
The Trustee is hereby authorized to join with the Partnership in the
execution of any such supplemental Indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer, assignment, mortgage or pledge of any property thereunder,
but the Trustee shall not be obligated to enter into any such supplemental
Indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
Any supplemental Indenture authorized by the provisions of this Section
9.01 may be executed by the Partnership and the Trustee without the consent of
the Holders of any of the Debt Securities at the time outstanding,
notwithstanding any of the provisions of Section 9.02.
In the case of Debt Securities subordinated pursuant to Article 12, an
amendment under this Section 9.01 may not make any change that adversely affects
the rights under Article 12 of any holder of Senior Indebtedness then
outstanding unless the holders of such Senior Indebtedness (or any group or
Representative thereof authorized to give a consent) consent to such change.
After an amendment under this Section 9.01 becomes effective, the
Partnership shall mail to Holders of Debt Securities of each series affected
thereby a notice briefly describing such amendment. The failure to give such
notice to all such Holders, or any defect therein, shall not impair or affect
the validity of an amendment under this Section 9.01.
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Subordinated Indenture
SECTION 9.02. MODIFICATION OF INDENTURE WITH CONSENT OF HOLDERS OF DEBT
SECURITIES.
Without notice to any Holder but with the consent (evidenced as
provided in Section 8.01) of the Holders of a majority in aggregate principal
amount of the outstanding Debt Securities of each series affected by such
supplemental Indenture, the Partnership, when authorized by Board Resolutions,
and the Trustee may from time to time and at any time enter into an Indenture or
Indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act as in force at the date of execution thereof) for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Indenture or of any supplemental Indenture or of
modifying in any manner the rights of the Holders of the Debt Securities of such
series; provided, that no such supplemental Indenture, without the consent of
the Holders of each Debt Security so affected, shall (i) reduce the percentage
in principal amount of Debt Securities of any series whose Holders must consent
to an amendment, supplement or waiver; (ii) reduce the principal of or change
the Stated Maturity of any Debt Security; (iii) reduce or waive the premium
payable upon the redemption of any Debt Security or alter or waive any
provisions by which any Debt Security may or shall be redeemed in accordance
with Article 3; (iv) reduce the rate of or change the time for payment of
interest on any Debt Security; (v) waive a Default or an Event of Default in the
payment of principal of, or premium, if any, with respect to a Debt Security
except for a rescission of an acceleration of such Debt Securities by the
Holders of at least a majority in aggregate principal amount of such Debt
Securities and a waiver of the payment default that resulted from such
acceleration; (vi) release any security that may have been granted in respect of
the Debt Securities; (vii) make any Debt Security payable in Currency other than
that stated in the Debt Security; (viii) make any change in the provisions of
this Indenture relating to waivers of past Defaults or the rights of Holders to
receive payments of principal of or premium, if any, or interest on the Debt
Securities; (ix) waive a redemption payment with respect to any Debt Security
other than as required by a covenant set forth in the applicable supplemental
Indenture; (x) except as otherwise permitted under this Indenture or any
supplemental indenture, with respect to Debt Securities that are guaranteed,
release any guarantor from its obligations under this Indenture or any
supplemental Indenture or under its guarantee or change any guarantee in any
manner that would adversely affect the rights of Holders of such Debt
Securities; (xi) in the case of any Debt Security subordinated pursuant to
Article 12, make any change in Article 12 that adversely affects the rights of
any Holder under Article 12; or (xii) make any change in Section 6.06 or this
Section 9.02.
A supplemental Indenture which changes or eliminates any covenant or
other provision of this Indenture which has been expressly included solely for
the benefit of one or more particular series of Debt Securities or which
modifies the rights of the Holders of Debt Securities of such series with
respect to such covenant or other provision, shall be deemed not to affect the
rights under this Indenture of the Holders of Debt Securities of any other
series.
Upon the request of the Partnership, accompanied by copies of Board
Resolutions authorizing the execution of any such supplemental Indenture, and
upon the filing with the Trustee of evidence of the consent of Holders as
aforesaid, the Trustee shall join with the Partnership in the execution of such
supplemental Indenture unless such supplemental Indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion but shall not be obligated to enter into
such supplemental Indenture.
50
Subordinated Indenture
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed supplemental
Indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
In the case of any Debt Securities subordinated pursuant to Article 12,
an amendment under this Section 9.02 may not make any change that adversely
affects the rights under Article 12 of any holder of Senior Indebtedness then
outstanding unless the holders of such Senior Indebtedness (or any group or
Representative thereof authorized to give a consent) consent to such change.
After an amendment under this Section 9.02 becomes effective, the
Partnership shall mail to Holders of Debt Securities of each series affected
thereby a notice briefly describing such amendment. The failure to give such
notice to all such Holders, or any defect therein, shall not impair or affect
the validity of an amendment under this Section 9.02.
SECTION 9.03. EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental Indenture pursuant to the
provisions of this Article 9, this Indenture shall be and be deemed to be
modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this Indenture
of the Trustee, the Partnership and the Holders shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such modifications
and amendments, and all the terms and conditions of any such supplemental
Indenture shall be and be deemed to be part of the terms and conditions of this
Indenture for any and all purposes.
The Trustee, subject to the provisions of Sections 7.01 and 7.02, may
receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such supplemental Indenture complies with the provisions of
this Article 9.
SECTION 9.04. DEBT SECURITIES MAY BEAR NOTATION OF CHANGES BY
SUPPLEMENTAL INDENTURES.
Debt Securities of any series authenticated and delivered after the
execution of any supplemental Indenture pursuant to the provisions of this
Article 9 may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
Indenture. New Debt Securities of any series so modified as to conform, in the
opinion of the Trustee and the Board of Directors, to any modification of this
Indenture contained in any such supplemental Indenture may be prepared and
executed by the Partnership, authenticated by the Trustee and delivered in
exchange for the Debt Securities of such series then outstanding. Failure to
make the appropriate notation or to issue a new Debt Security of such series
shall not affect the validity of such amendment.
ARTICLE 10
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 10.01. CONSOLIDATIONS AND MERGERS OF THE PARTNERSHIP.
The Partnership may not, directly or indirectly: (i) consolidate or
merge with or into another Person (whether or not the Partnership is the
survivor); or (ii) sell, assign, transfer, lease, convey or otherwise dispose of
all or substantially all of its properties or assets, in one or more related
transactions, to another Person; unless:
51
Subordinated Indenture
(1) either (i) the Partnership is the surviving entity of such
transaction or (ii) the Person formed by or surviving any such consolidation or
merger (if other than the Partnership) or to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made (the
"SUCCESSOR COMPANY") is an entity organized or existing under the laws of the
United States, any state thereof or the District of Columbia;
(2) the Successor Company assumes all the obligations of the
Partnership under the Debt Securities and this Indenture pursuant to agreements
reasonably satisfactory to the Trustee;
(3) immediately after such transaction no Default or Event of Default
exists; and
(4) the Partnership has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer and, if a supplemental Indenture is required, such
supplemental Indenture complies with this Indenture and all conditions precedent
therein relating to such transaction have been satisfied.
SECTION 10.02. RIGHTS AND DUTIES OF SUCCESSOR COMPANY.
In case of any consolidation or merger, or conveyance or transfer of
the assets of the Partnership as an entirety or virtually as an entirety in
accordance with Section 10.01, the Successor Company shall succeed to and be
substituted for the Partnership, with the same effect as if it had been named
herein as the party of the first part, and the Partnership shall be released
from all liabilities and obligations, and relieved of any further obligation,
under this Indenture and the Debt Securities. The Successor Company thereupon
may cause to be signed, and may issue either in its own name or in the name of
the Partnership, any or all the Debt Securities issuable hereunder which
theretofore shall not have been signed by the Partnership and delivered to the
Trustee; and, upon the order of the Successor Company, instead of the
Partnership, and subject to all the terms, conditions and limitations in this
Indenture prescribed, the Trustee shall authenticate and shall deliver any Debt
Securities which previously shall have been signed and delivered by the officers
of the Partnership to the Trustee for authentication, and any Debt Securities
which the Successor Company thereafter shall cause to be signed and delivered to
the Trustee for that purpose. All the Debt Securities so issued shall in all
respects have the same legal rank and benefit under this Indenture as the Debt
Securities theretofore or thereafter issued in accordance with the terms of this
Indenture as though all such Debt Securities had been issued at the date of the
execution hereof.
In case of any such consolidation, merger, sale or conveyance such
changes in phraseology and form (but not in substance) may be made in the Debt
Securities appertaining thereto thereafter to be issued as may be appropriate.
ARTICLE 11
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS; DEFEASANCE
SECTION 11.01. APPLICABILITY OF ARTICLE.
The provisions of this Article 11 relating to the defeasance of Debt
Securities shall be applicable to each series of Debt Securities except as
otherwise specified pursuant to Section 2.03 for Debt Securities of such series.
52
Subordinated Indenture
SECTION 11.02. SATISFACTION AND DISCHARGE OF INDENTURE; DEFEASANCE.
(a) If at any time the Partnership shall have delivered to the Trustee
for cancellation all Debt Securities of any series theretofore authenticated and
delivered (other than any Debt Securities of such series which shall have been
destroyed, lost or stolen and which shall have been replaced or paid as provided
in Section 2.09 and Debt Securities for whose payment money has theretofore been
deposited in trust and thereafter repaid to the Partnership as provided in
Section 11.05) or all Debt Securities of such series not theretofore delivered
to the Trustee for cancellation shall have become due and payable, or are by
their terms to become due and payable within one year or are to be called for
redemption within one year under arrangements satisfactory to the Trustee for
the giving of notice of redemption, and the Partnership shall deposit with the
Trustee as trust funds the entire amount in cash sufficient to pay at maturity
or upon redemption all Debt Securities of such series not theretofore delivered
to the Trustee for cancellation, including principal and premium, if any, and
interest due or to become due on such date of maturity or redemption date, as
the case may be, and if in either case the Partnership shall also pay or cause
to be paid all other sums payable hereunder by the Partnership, then this
Indenture shall cease to be of further effect (except as to any surviving rights
of registration of transfer or exchange of such Debt Securities herein expressly
provided for) with respect to the Debt Securities of such series, and the
Trustee, on demand of the Partnership accompanied by an Officers' Certificate
and an Opinion of Counsel and at the cost and expense of the Partnership, shall
execute proper instruments acknowledging satisfaction of and discharging this
Indenture.
(b) Subject to Sections 11.02(c) and 11.07, the Partnership at any time
may terminate, with respect to Debt Securities of a particular series, all its
obligations under the Debt Securities of such series and this Indenture with
respect to the Debt Securities of such series ("LEGAL DEFEASANCE OPTION") or the
operation of Sections 6.01(d), (e) and (h) ("COVENANT DEFEASANCE OPTION"). If
the Partnership exercises its legal defeasance option, the guarantee of any
obligor will terminate with respect to that series of Debt Securities. The
Partnership may exercise its legal defeasance option notwithstanding its prior
exercise of its covenant defeasance option.
If the Partnership exercises its legal defeasance option, payment of
the Debt Securities of the defeased series may not be accelerated because of an
Event of Default. If the Partnership exercises its covenant defeasance option,
payment of the Debt Securities of the defeased series may not be accelerated
because of an Event of Default specified in Sections 6.01(d), (e) and (h)
(except to the extent covenants or agreements reference in such Sections remain
applicable.
Upon satisfaction of the conditions set forth herein and upon request
of the Partnership, the Trustee shall acknowledge in writing the discharge of
those obligations that the Partnership terminates.
(c) Notwithstanding the provisions of clauses (a) and (b) above, the
Partnership's obligations in Sections 2.07, 2.09, 4.02, 4.04, 5.01, 7.06, 7.10,
11.05, 11.06, and 11.07 shall survive until the Debt Securities of the defeased
series have been paid in full. Thereafter, the Partnership's obligations in
Sections 7.06, 11.05 and 11.06 shall survive.
SECTION 11.03. CONDITIONS OF DEFEASANCE.
The Partnership may exercise its legal defeasance option or its
covenant defeasance option with respect to Debt Securities of a particular
series only if:
53
Subordinated Indenture
(a) the Partnership irrevocably deposits in trust with the Trustee
money or U.S. Government Obligations for the payment of principal of, and
premium, if any, and interest on, the Debt Securities of such series to maturity
or redemption, as the case may be;
(b) the Partnership delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their opinion
that the payments of principal and interest when due and without reinvestment on
the deposited U.S. Government Obligations plus any deposited money without
investment will provide cash at such times and in such amounts as will be
sufficient to pay the principal, premium and interest when due on all the Debt
Securities of such series to maturity or redemption, as the case may be;
(c) 91 days pass after the deposit is made and during the 91-day period
no Default specified in Section 6.01(f) or (g) with respect to the Partnership
occurs which is continuing at the end of the period;
(d) no Default has occurred and is continuing on the date of such
deposit and after giving effect thereto;
(e) the deposit does not constitute a default under any other agreement
binding on the Partnership and, if the Debt Securities of such series are
subordinated pursuant to Article 12, is not prohibited by Article 12;
(f) the Partnership delivers to the Trustee an Opinion of counsel to
the effect that the trust resulting from the deposit does not constitute, or is
qualified as, a regulated investment company under the Investment Company Act of
1940;
(g) in the event of the legal defeasance option, the Partnership shall
have delivered to the Trustee an Opinion of Counsel stating that the Partnership
has received from the Internal Revenue Service a ruling, or since the date of
this Indenture there has been a change in the applicable Federal income tax law,
in either case of the effect that, and based thereon such Opinion of Counsel
shall confirm that, the Holders of Debt Securities of such series will not
recognize income, gain or loss for Federal income tax purposes as a result of
such defeasance and will be subject to Federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if such
defeasance had not occurred;
(h) in the event of the covenant defeasance option, the Partnership
shall have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of Debt Securities of such series 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 a manner
and at the same times as would have been the case if such covenant defeasance
had not occurred; and
(i) the Partnership delivers to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent to the
defeasance and discharge of the Debt Securities of such series as contemplated
by this Article 11 have been complied with.
Before or after a deposit, the Partnership may make arrangement
satisfactory to the Trustee for the redemption of Debt Securities of such series
at a future date in accordance with Article 3.
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Subordinated Indenture
SECTION 11.04. APPLICATION OF TRUST MONEY.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to this Article 11. It shall apply the deposited
money and the money from U.S. Government Obligations through any paying agent
and in accordance with this Indenture to the payment of principal of, and
premium, if any, and interest on, the Debt Securities of the defeased series. In
the event the Debt Securities of the defeased series are subordinated pursuant
to Article 12, money and securities so held in trust are not subject to Article
12.
SECTION 11.05. REPAYMENT TO THE PARTNERSHIP.
The Trustee and any paying agent shall promptly turn over to the
Partnership upon request any excess money or securities held by them at any
time.
Subject to any applicable abandoned property law, the Trustee and any
paying agent shall pay to the Partnership upon request any money held by them
for the payment of principal, premium or interest that remains unclaimed for two
years, and, thereafter, Holders entitled to such money must look to the
Partnership for payment as general creditors.
SECTION 11.06. INDEMNITY FOR U.S. GOVERNMENT OBLIGATIONS.
The Partnership shall pay and shall indemnify the Trustee and the
Holders against any tax, fee or other charge imposed on or assessed against
deposited U.S. Government Obligations or the principal and interest received on
such U.S. Government Obligations.
SECTION 11.07. Reinstatement.
If the Trustee or any paying agent is unable to apply any money or U.S.
Government Obligations in accordance with this Article 11 by reason of any legal
proceeding or by reason of any order or judgment of any court or government
authority enjoining, restraining or otherwise prohibiting such application, the
Partnership's obligations under this Indenture and the Debt Securities of the
defeased series shall be revived and reinstated as though no deposit had
occurred pursuant to this Article 11 until such time as the Trustee or any
paying agent is permitted to apply all such money or U.S. Government Obligations
in accordance with this Article 11.
ARTICLE 12
SUBORDINATION OF DEBT SECURITIES
SECTION 12.01. APPLICABILITY OF ARTICLE; AGREEMENT TO SUBORDINATE.
The provisions of this Article 12 shall only be applicable to the Debt
Securities of any series (Debt Securities of such series referred to in this
Article 12 as "SUBORDINATED DEBT SECURITIES") designated, pursuant to Section
2.03, as subordinated to Senior Indebtedness and any related guarantee of such
Subordinated Debt Securities. Each Holder by accepting a Subordinated Debt
Security agrees that the Debt evidenced by such Subordinated Debt Security and
any related guarantee of such Subordinated Debt Security is subordinated in
right of payment, to the extent that in the manner provided in this Article 12,
to the prior payment of all Senior Indebtedness and that the subordination is
for the benefit of and enforceable by the holders of Senior Indebtedness. All
provisions of this Article 12 shall be subject to Section 12.12.
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SECTION 12.02. LIQUIDATION, DISSOLUTION, BANKRUPTCY.
Upon any payment or distribution of the assets of the Partnership or
any Subsidiary of the Partnership which has guaranteed a Debt Security, as the
case may be, to creditors upon a total or partial liquidation or a total or
partial dissolution of the Partnership or such Subsidiary, as the case may be,
or in a bankruptcy, reorganization, insolvency, receivership or similar
proceeding relating to the Partnership or such Subsidiary, as the case may be,
or their respective property:
(i) holders of Senior Indebtedness of the Partnership or any
such Subsidiary, as the case may be, shall be entitled to receive
payment in full in cash of such Senior Indebtedness of such Person
(including interest (if any), accruing on or after the commencement of
a proceeding in bankruptcy, whether or not allowed as a claim against
the Partnership or such Subsidiary, as the case may be, in such
bankruptcy proceeding) before Holders of Subordinated Debt Securities
and any related guarantee of such Subsidiary shall be entitled to
receive any payment of principal of, or premium, if any, or interest
on, the Subordinated Debt Securities from the Partnership, or any
payment in respect of any guarantee from the Subsidiary; and
(ii) until the Senior Indebtedness of the Partnership or such
Subsidiary, as the case may be, is paid in full, any distribution to
which Holders of Subordinated Debt Securities and any related guarantee
of such Subsidiary would be entitled but for this Article 12 shall be
made to holders of Senior Indebtedness of the Partnership or such
Subsidiary, as the case may be, as their interests may appear, except
that such Holders may receive shares of stock and any debt securities
that are subordinated to Senior Indebtedness of the Partnership or such
Subsidiary, as the case may be, to at least the same extent as the
Subordinated Debt Securities of the Partnership or the related
guarantee of such Subsidiary, respectively.
SECTION 12.03. DEFAULT OF SENIOR INDEBTEDNESS.
The Partnership and any Subsidiary of the Partnership which has
guaranteed any Debt Security may not pay the principal of, or premium, if any,
or interest on, the Subordinated Debt Securities or any related guarantee of
such Subsidiary or make any deposit pursuant to Article 11 and may not
repurchase, redeem or otherwise retire (except, in the case of Subordinated Debt
Securities that provide for a mandatory sinking fund pursuant to Section 3.05,
by the delivery of Subordinated Debt Securities by the Partnership to the
Trustee pursuant to the first paragraph of Section 3.05) any Subordinated Debt
Securities (collectively, "PAY THE SUBORDINATED DEBT SECURITIES") if any
principal, premium or interest in respect of Senior Indebtedness of such Person
is not paid within any applicable grace period (including at maturity) or any
other default on Senior Indebtedness of such Person occurs and the maturity of
such Senior Indebtedness is accelerated in accordance with its terms unless, in
either case, the default has been cured or waived and any such acceleration has
been rescinded or such Senior Indebtedness has been paid in full in cash;
provided, however, that the Partnership and such Subsidiary may make payments on
the Subordinated Debt Securities or any related guarantee of such Subsidiary
without regard to the foregoing if the Partnership and the Trustee receive
written notice approving such payment from the Representative of each issue of
Designated Senior Indebtedness. During the continuance of any default with
respect to any Designated Senior Indebtedness pursuant to which the maturity
thereof may be accelerated immediately without further notice (except such
notice as may be required to effect such acceleration) or the expiration of any
applicable grace periods, the Partnership and any Subsidiary of the Partnership
which has guaranteed a Debt Security may not make payments on the Subordinated
Debt Securities or any related guarantee of such Subsidiary
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for a period (a "PAYMENT BLOCKAGE PERIOD") commencing upon the receipt by the
Partnership and the Trustee (and if such Designated Senior Indebtedness is debt
of such a Subsidiary, such Subsidiary) of written notice of such default from
the Representative of any Designated Senior Indebtedness specifying an election
to effect a Payment Blockage Period ("BLOCKAGE NOTICE") and ending 179 days
thereafter (or earlier if such Payment Blockage Period is terminated by written
notice to the Trustee and the Partnership (and if such Designated Senior
Indebtedness is Debt of such a Subsidiary, such Subsidiary) from the Person or
Persons who gave such Blockage Notice, by repayment in full in cash of such
Designated Senior Indebtedness or because the default giving rise to such
Blockage Notice is no longer continuing). Notwithstanding the provisions
described in the immediately preceding sentence (but subject to the provisions
contained in the first sentence of this Section 12.03), unless the holders of
such Designated Senior Indebtedness or the Representative of such holders shall
have accelerated the maturity of such Designated Senior Indebtedness, the
Partnership and any Subsidiary of the Partnership which has guaranteed a Debt
Security may resume payments on the Subordinated Debt Securities and related
guarantees of such Subsidiary after such Payment Blockage Period. Not more than
one Blockage Notice may be given in any consecutive 360-day period, irrespective
of the number of defaults with respect to any number of issues of Designated
Senior Indebtedness during such period, unless otherwise specified pursuant to
Section 2.03 for the Subordinated Debt Securities of a series; provided,
however, that in no event may the total number of days during which any Payment
Blockage Period or Periods is in effect exceed 179 days in the aggregate during
any 360 consecutive day period. For purposes of this Section 12.03, no default
or event of default which existed or was continuing on the date of the
commencement of any Payment Blockage with respect to the Designated Senior
Indebtedness initiating such Payment Blockage Period shall be, or be made, the
basis of the commencement of a subsequent Payment Blockage Period by the
Representative of such Designated Senior Indebtedness, whether or not within a
period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.
SECTION 12.04. ACCELERATION OF PAYMENT OF DEBT SECURITIES.
If payment of the Subordinated Debt Securities is accelerated because
of an Event of Default, the Partnership shall promptly notify the holders of the
Designated Senior Indebtedness (or their Representatives) of the acceleration.
SECTION 12.05. WHEN DISTRIBUTION MUST BE PAID OVER.
If a distribution is made to Holders of Subordinated Debt Securities or
a related guarantee of a Subsidiary of the Partnership that because of this
Article 12 should not have been made to them, the Holders who receive such
distribution shall hold it in trust for holders of Senior Indebtedness and pay
it over to them as their interests may appear.
SECTION 12.06. SUBROGATION.
After all Senior Indebtedness is paid in full and until the
Subordinated Debt Securities are paid in full, Holders thereof shall be
subrogated to the rights of holders of Senior Indebtedness to receive
distributions applicable to Senior Indebtedness. A distribution made under this
Article 12 to holders of a Senior Indebtedness which otherwise would have been
made to Holders of Subordinated Debt Securities is not, as between the
Partnership or any Subsidiary of the Partnership which has guaranteed a Debt
Security, as the case may be, and such Holders, a payment by the Partnership or
such Subsidiary, as the case may be, on Senior Indebtedness.
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SECTION 12.07. RELATIVE RIGHTS.
This Article 12 defines the relative rights of Holders of Subordinated
Debt Securities and holders of Senior Indebtedness. Nothing in this Indenture
shall:
(i) impair, as between the Partnership or any Subsidiary of
the Partnership which has guaranteed a Debt Security, as the case may
be, and Holders of either Subordinated Debt Securities or Debt
Securities, the obligation of the Partnership or such Subsidiary, as
the case may be, which is absolute and unconditional, to pay principal
of, and premium, if any, and interest on, the Subordinated Debt
Securities and the Debt Securities in accordance with their terms; or
(ii) prevent the Trustee or any Holder of either Subordinated
Debt Securities or Debt Securities from exercising its respective
available remedies upon a Default, subject to the rights of holders of
Senior Indebtedness to receive distributions otherwise payable to
Holders of Subordinated Debt Securities.
SECTION 12.08. SUBORDINATION MAY NOT BE IMPAIRED BY PARTNERSHIP.
No right of any holder of Senior Indebtedness to enforce the
subordination of the Debt evidenced by the Subordinated Debt Securities and any
guarantee in respect thereof shall be impaired by any act or failure to act by
the Partnership or any Subsidiary of the Partnership which has guaranteed a Debt
Security or by its failure to comply with this Indenture.
SECTION 12.09. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding Section 12.03, the Trustee or any paying agent may
continue to make payments on Subordinated Debt Securities and shall not be
charged with knowledge of the existence of facts that would prohibit the making
of any such 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 it that payments may not be made under this Article 12. The
Partnership, the Registrar, any paying agent, a Representative or a holder of
Senior Indebtedness may give the notice; provided, however, that, if an issue of
Senior Indebtedness has a Representative, only the Representative may give the
notice on behalf of the Holders of the Senior Indebtedness of that issue.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. The
Registrar and any paying agent may do the same with like rights. The Trustee
shall be entitled to all the rights set forth in this Article 12 with respect to
any Senior Indebtedness which may at any time be held by it, to the same extent
as any other holder of Senior Indebtedness; and nothing in Article 7 shall
deprive the Trustee of any of its rights as such holder. Nothing in this Article
12 shall apply to claims of, or payments to, the Trustee under or pursuant to
Section 7.06.
SECTION 12.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of
Senior Indebtedness, the distribution may be made and the notice given to their
Representative (if any).
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SECTION 12.11. ARTICLE 12 NOT TO PREVENT DEFAULTS OR LIMIT RIGHT TO
ACCELERATE.
The failure to make a payment pursuant to the Subordinated Debt
Securities, whether directly or pursuant to any Guarantee therefor, by reason of
any provision in this Article 12 shall not be construed as preventing the
occurrence of a Default. Nothing in this Article 12 shall have any effect on the
right of the Holders or the Trustee to accelerate the maturity of either the
Subordinated Debt Securities or the Debt Securities, as the case may be.
SECTION 12.12. TRUST MONEYS NOT SUBORDINATED.
Notwithstanding anything contained herein to the contrary, payments
from money or the proceeds of U.S. Government Obligations held in trust under
Article 11 by the Trustee for the payment of principal of, and premium, if any,
and interest on, the Subordinated Debt Securities or the Debt Securities shall
not be subordinated to the prior payment of any Senior Indebtedness or subject
to the restrictions set forth in this Article 12, and none of the Holders
thereof shall be obligated to pay over any such amount to the Partnership, any
Subsidiary of the Partnership which has guaranteed a Debt Security or any holder
of Senior Indebtedness of the Partnership or such Subsidiary or any other
creditor of the Partnership or such Subsidiary.
SECTION 12.13. TRUSTEE ENTITLED TO RELY.
Upon any payment or distribution pursuant to this Article 12, the
Trustee and the Holders shall be entitled to rely upon any order or decree of a
court of competent jurisdiction in which any proceedings of the nature referred
to in Section 12.02 are pending, upon a certificate of the liquidating trustee
or agent or other Person making such payment or distribution to the Trustee or
to such Holders or upon the Representatives for the holders of Senior
Indebtedness for the purpose of ascertaining the Persons entitled to participate
in such payment or distribution, the holders of the Senior Indebtedness and
other Debt of the Partnership or any Subsidiary of the Partnership which has
guaranteed a Debt Security, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article 12. 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 to participate in any payment or distribution pursuant to
this Article 12, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and other facts pertinent to the rights of such
Person under this Article 12, and, if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment. The provisions of Sections
7.01 and 7.02 shall be applicable to all actions or omissions of actions by the
Trustee pursuant to this Article 12.
SECTION 12.14. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder by accepting a Subordinated Debt Security authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination between the Holders
of Subordinated Debt Securities and the holders of Senior Indebtedness as
provided in this Article 12 and appoints the Trustee as attorney-in-fact for any
and all such purposes.
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SECTION 12.15. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR
INDEBTEDNESS.
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if it
shall mistakenly pay over or distribute to Holders of Subordinated Debt
Securities or the Partnership or any Subsidiary of the Partnership which has
guaranteed a Debt Security or any other Person, money or assets to which any
holders of Senior Indebtedness shall be entitled by virtue of this Article 12 or
otherwise.
SECTION 12.16. RELIANCE BY HOLDERS OF SENIOR INDEBTEDNESS ON
SUBORDINATION PROVISIONS.
Each Holder by accepting a Subordinated Debt Security 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,
whether such Senior Indebtedness was created or acquired before or after the
issuance of the Subordinated Debt Securities, to acquire and continue to hold,
or to continue to hold, such Senior Indebtedness and such holder of 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.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly signed as of the date first written above.
KANEB PIPE LINE OPERATING PARTNERSHIP, L.P.
By: Kaneb Pipe Line Company LLC
as General Partner
By
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Name:
Title:
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By
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Name:
Title:
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