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EXHIBIT 4.1
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INDENTURE
Dated as of June __, 1997
by and between
MCA FINANCIAL CORP.
(the "Company")
and
FIRST UNION NATIONAL BANK
(the "Trustee")
relating to
$20,000,000
__% Subordinated Debentures, Series 1997, Due June 1, 2003
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TABLE OF CONTENTS
ARTICLE ONE
Definitions and Other Provisions of
General Application
Section 1.01. Definitions.............................................. 1
Section 1.02. Compliance Certificates and Opinions..................... 5
Section 1.03. Form of Documents Delivered to Trustee................... 6
Section 1.04. Acts of Debentureholders................................. 6
Section 1.05. Notices, etc., to Trustee and Company.................... 7
Section 1.06. Notices to Debentureholders; Waiver...................... 7
Section 1.07 Record Date for Action by Debentureholders............... 7
Section 1.08 Communications by Holders with Other Holders............. 8
Section 1.09 Affiliates of Company Exempt from Individual Liability... 8
Section 1.10 Payments Due on Saturdays, Sundays and Holidays.......... 8
Section 1.11 Provisions Required by TIA to Control.................... 9
Section 1.12 Counterparts............................................. 9
Section 1.13. Effect of Headings and Table of Contents................. 9
Section 1.14. Successors and Assigns................................... 9
Section 1.15. Separability Clause...................................... 9
ARTICLE TWO
Debenture Forms
Section 2.01. Forms Generally.......................................... 9
Section 2.02. Title and Terms.......................................... 9
Section 2.03. Denominations............................................ 10
Section 2.04. Execution, Authentication and Delivery and Dating........ 10
Section 2.05. Temporary Debentures..................................... 10
Section 2.06. Registration, Transfer and Exchange...................... 11
Section 2.07. Mutilated, Destroyed, Lost and Stolen Debentures......... 11
Section 2.08. Payment of Interest; Interest Rights Preserved........... 12
Section 2.09. Persons Deemed Owners.................................... 13
Section 2.10. Cancellation............................................. 13
Section 2.11. Authentication and Delivery of Original Issue............ 14
Section 2.12. Computation of Interest.................................. 14
ARTICLE THREE
Redemption
Section 3.01. Optional Redemption...................................... 14
Section 3.02. Mandatory Redemption..................................... 14
Section 3.03. Redemption of Debentures................................. 16
Section 3.04. Debentures Redeemed in Part.............................. 17
ARTICLE FOUR
Satisfaction and Discharge
Section 4.01. Satisfaction and Discharge of Indenture.................. 17
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Section 4.02. Application of Trust Money..................................................... 18
ARTICLE FIVE
Remedies
Section 5.01. Events of Default.............................................................. 18
Section 5.02. Acceleration of Maturity; Rescission and Annulment............................. 19
Section 5.03. Collection of Indebtedness and Suits for Enforcement by Trustee................ 20
Section 5.04. Trustee May File Proofs of Claim............................................... 20
Section 5.05. Trustee May Enforce Claims Without Possession of Debentures.................... 21
Section 5.06. Application of Money Collected................................................. 21
Section 5.07. Limitation on Suits............................................................ 22
Section 5.08. Right of Debentureholders to Receive Principal and Interest.................... 22
Section 5.09. Restoration of Rights and Remedies............................................. 23
Section 5.10. Rights and Remedies Cumulative................................................. 23
Section 5.11. Delay or Omission Not Waiver................................................... 23
Section 5.12. Rights of Holders to Direct Trustee and to Waive Defaults...................... 23
Section 5.13. Undertaking for Costs.......................................................... 23
ARTICLE SIX
Section 6.01. Certain Duties and Responsibilities............................................ 24
Section 6.02. Notice of Defaults............................................................. 25
Section 6.03. Certain Powers of Trustee...................................................... 25
Section 6.04. Not Responsible for Recitals or Issuance of Debentures......................... 26
Section 6.05. May Hold Debentures............................................................ 26
Section 6.06. Money Held in Trust............................................................ 26
Section 6.07. Compensation and Indemnity..................................................... 26
Section 6.08. Eligibility; Disqualification.................................................. 27
Section 6.09. Resignation and Removal; Appointment of Successor.............................. 27
Section 6.10. Acceptance of Appointment by Successor......................................... 28
Section 6.11. Merger, Conversion, Consolidation or Succession to Business.................... 29
Section 6.12. Preferential Collection of Claims Against Company.............................. 29
Section 6.13. Reports by the Trustee......................................................... 29
Section 6.14. Lists of Debentureholders...................................................... 29
ARTICLE SEVEN
Supplemental Indentures
Section 7.01. Supplemental Indentures Without Consent of Debentureholders.................... 29
Section 7.02. Supplemental Indentures With Consent of Debentureholders....................... 30
Section 7.03. Execution of Supplemental Indentures........................................... 31
Section 7.04. Effect of Supplemental Indentures.............................................. 31
Section 7.05. Reference in Debentures to Supplemental Indentures............................. 31
Section 7.06. Effect on Senior Indebtedness.................................................. 31
ARTICLE EIGHT
Covenants
Section 8.01. Payment of Principal and Interest.............................................. 31
Section 8.02. Maintenance of Office or Agency................................................ 31
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Section 8.03. Money for Debenture Payments to be Held In Trust............................... 31
Section 8.04. Payment of Taxes and Other Claims.............................................. 32
Section 8.05. Company Existence.............................................................. 33
Section 8.06. Company May Consolidate, etc., Only on Certain Terms........................... 33
Section 8.07. Restrictions on Dividends, Redemptions, etc.................................... 33
Section 8.08. Reports by the Company......................................................... 34
ARTICLE NINE
Subordination of Debentures
Section 9.01. Agreement to Subordinate....................................................... 34
Section 9.02. Distribution on Dissolution, Liquidation and Reorganization.................... 34
Section 9.03. Payments on Debentures Prohibited During Event of Default
under Senior Indebtedness...................................................... 34
Section 9.04. Subrogation.................................................................... 35
Section 9.05. Obligation of Company Unconditional............................................ 35
Section 9.06. Payments on Debentures Permitted............................................... 36
Section 9.07. Effectuation of Subordination by Trustee....................................... 36
Section 9.08. Knowledge of Trustee........................................................... 36
Section 9.09. Trustee May Hold Senior Indebtedness........................................... 36
Section 9.10. Rights of Holders of Senior Indebtedness Not Impaired.......................... 36
Section 9.11. Rights and Obligations Subject to Power of Court............................... 36
SIGNATURES.................................................................................... 37
Exhibit A - Form of Debenture
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THIS INDENTURE, dated as of June __, 1997, is made by and between MCA
FINANCIAL CORP., a Michigan corporation, having its principal office at 00000
Xxxxxxxxxxxx Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000 (the "Company"), and FIRST
UNION NATIONAL BANK, a national banking association having its principal
corporate trust office at 000 Xxxxx Xxxxxx, Xxxxxx, Xxx Xxxxxx 00000-0000 (the
"Trustee").
RECITALS
The Company has duly authorized the creation, execution and delivery of
its debentures, to be known as its __% Subordinated Debentures, Series 1997,
Due June 1, 2003 (hereinafter referred to as the "Debentures"), the amount and
terms of which are as hereinafter provided; and, to provide the terms and
conditions upon which the Debentures are to be authenticated, issued and
delivered, the Company has duly authorized the execution of this Indenture.
All acts and things necessary to make the Debentures, when executed by the
Company and authenticated and delivered by the Trustee as in this Indenture
provided, the valid, binding and legal obligations of the Company, and to
constitute these presents as a valid indenture and agreement according to its
terms, have been done and performed, and the execution of this Indenture and
the issue hereunder of the Debentures have in all respects been duly
authorized, and the Company, in the exercise of the legal right and power
vested in it, executes this Indenture and proposes to make, execute, and
deliver the Debentures.
For and in consideration of the premises and the purchase of the
Debentures by the Holders thereof, and to secure the observance and performance
by the Company of all covenants and obligations expressed or implied herein and
in the Debentures, and in consideration of the receipt of proceeds from the
issuance and sale of the Debentures, the Company and the Trustee mutually
covenant and agree, for the equal and proportionate benefit of all Holders of
the Debentures as follows:
ARTICLE ONE
Definitions and Other Provisions of
General Application
Section 1.01. Definitions. For all purposes of this Indenture and any
indenture supplemental hereto, except as otherwise expressly provided or unless
the context otherwise requires:
(1) all references in this instrument to designated "Articles,"
"Sections" and other subdivisions are to the designated articles,
sections and other subdivisions of this instrument as originally
executed. 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;
(2) the terms defined in this Article have the meaning assigned
to them in this Article, and include the plural as well as the singular;
(3) all other terms used herein which are defined in the TIA,
either directly or by reference therein, have the meanings assigned to them
therein; and
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(4) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles, which, with respect to any computation required or
permitted hereunder, shall mean such accounting principles as are
generally accepted at the date or time of such computation.
Certain terms, used principally in Article Six, are defined in that
Article.
"Act" when used with respect to any Debentureholder has the meaning
specified in Section 1.04.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Board of Directors" means either the board of directors of the Company or
any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company to have been duly adopted by the Board
of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday,
which is not a day upon which banking institutions in the City of Charlotte,
North Carolina are authorized or required by law to close.
"Common Equity" means the aggregate amount of the Common Stock, Additional
Paid-in Capital and Retained Earnings accounts of the Company, as shown on the
audited consolidated balance sheet of the Company at any particular date.
"Company" means MCA Financial Corp., a Michigan corporation, until a
successor shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Company" shall mean such successor.
"Company Request," "Company Order" and "Company Consent" means,
respectively, a written request, order or consent signed in the name of the
Company by the Chairman of the Board, Vice Chairman of the Board, President,
any Executive Vice President, any Senior Vice President or any Vice President,
and by the Treasurer, an Assistant Treasurer, Controller, an Assistant
Controller, Secretary or an Assistant Secretary, and delivered to the Trustee.
"Consolidated Net Worth" means, as of the date of any determination
thereof, the sum of all capital stock accounts of the Company, net of any
treasury stock (valued at its cost to the Company), plus (or minus in the case
of a deficit) the surplus and retained earnings of the Company and its
consolidated Subsidiaries, all as determined in accordance with generally
accepted accounting principles, plus the principal amount of any unsecured
Indebtedness of the Company that is, by its terms, expressly subordinate in
right of payment to the Debentures.
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"Date of Issue" as to any Debenture (or portion thereof), means the date
of their authentication.
"Debentureholder" means a Person in whose name a Debenture is registered
in the Debenture Register.
"Debenture Register" and "Debenture Registrar" have the respective
meanings specified in Section 2.06.
"Defaulted Interest" has the meaning specified in Section 2.08.
"Equity Securities" means shares of any class or classes of stock, or
other securities, of the Company, other than debt securities of the Company
whether or not such debt securities are convertible into other securities of
the Company.
"Holder" when used with respect to any Debenture means a Debentureholder.
"Indebtedness" with respect to any Person at any date means and includes
all items of indebtedness or liability which, in accordance with generally
accepted accounting principles, would be included in determining total
liabilities as shown on the balance sheet of such Person at such date, and
shall include (i) all indebtedness guaranteed or endorsed (other than for
purposes of collection in the ordinary course of business), directly or
indirectly, in any manner, by such Person, and contingent obligations of such
Person with respect to, or to purchase or otherwise acquire, indebtedness of
others, and (ii) all indebtedness secured by any mortgage, lien, pledge, charge
or encumbrance upon property owned by such Person, whether or not the
indebtedness so secured has been assumed by such Person.
"Indenture" means this instrument as originally executed or as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Debentures.
"MCA" means Mortgage Corporation of America, a Michigan corporation that
is a wholly-owned subsidiary of the Company, and it successors and assigns.
"MCA Mortgage" means MCA Mortgage Corporation, a Michigan corporation that
is a wholly-owned subsidiary of the Company, and it successors and assigns.
"Mandatory Redemption Date" shall have the meaning given to such term in
Section 3.02.
"Maturity" when used with respect to any Debenture means the date on which
the principal of such Debenture becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration of acceleration or
otherwise.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, Vice Chairman of the Board, the President, any Executive Vice President,
any Senior Vice President or any Vice President, and by the Treasurer, an
Assistant Treasurer, the Controller, an Assistant Controller, the Secretary or
an Assistant Secretary of the Company, and delivered to the Trustee. Wherever
this Indenture requires that an Officers'
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Certificate be signed also by an accountant or other expert, such accountant or
other expert, except as otherwise expressly provided in this Indenture, may be
in the employ of the Company, but must have been approved by the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may, except
as otherwise expressly provided in this Indenture, be counsel for or an
employee of the Company, who is acceptable to the Trustee.
"Outstanding" when used with respect to Debentures means, as of the date
of determination, all Debentures theretofore authenticated and delivered under
this Indenture, except (a) Debentures theretofore canceled by the Trustee or
delivered to the Trustee for cancellation, (b) Debentures for whose payment
money in the necessary amount has been theretofore deposited with the Trustee
or any Paying Agent in trust for the Holders of such Debentures and (c)
Debentures in exchange for or in lieu of which other Debentures have been
authenticated and delivered pursuant to this Indenture; provided, however, that
in determining whether the Holders of the requisite principal amount of
Debentures Outstanding have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Debentures owned by the Company
or any other obligor upon the Debentures or any Affiliate of the Company or
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 Debentures which the Trustee knows to be so owned shall be so
disregarded. Debentures 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 to act with respect to such Debentures and that the
pledgee is not the Company or any other obligor upon the Debentures or any
Affiliate of the Company or such other obligor.
"Paying Agent" shall have the meaning given to such term in Section 2.08.
"Place of Payment" means a city or any political subdivision thereof
designated as such in Article Two.
"Predecessor Debentures" of any particular Debenture means every previous
Debenture evidencing all or a portion of the same debt as that evidenced by
such particular Debenture; and, for the purposes of this definition, any
Debenture authenticated and delivered under Section 2.07 in lieu of a lost,
destroyed or stolen Debenture shall be deemed to evidence the same debt as the
lost, destroyed or stolen Debenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date means the close of business in the first day of the calendar month
preceding the month in which falls an Interest Payment Date.
"Responsible Officer" when used with respect to the Trustee means the
Chairman or Vice-Chairman of the Board of Directors, the Chairman or Vice
Chairman of the executive committee of the Board of Directors, the President,
any Executive Vice President, any Senior Vice President, any Vice President,
the Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer,
the Cashier, any Assistant Cashier, any Trust Officer or Assistant Trust
Officer, the Controller, any Assistant Controller or any other officer of the
Trustee customarily performing functions similar to those performed by any of
the above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
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"Senior Indebtedness" means all Indebtedness of the Company for money
borrowed from others, whether outstanding on the date hereof or hereafter
created or incurred, which is not by its terms expressly either subordinate and
junior to, or on a parity with, the Debentures.
"Special Record Date" for the payment of any Defaulted Interest, as
defined in Section 2.08, means a date fixed by the Trustee pursuant to Section
2.08.
"Stated Maturity" when used with respect to any Debenture or any
installment of interest thereon means the date specified in such Debenture as
the fixed date on which the principal of such Debenture or such installment of
interest is due and payable.
"Subsidiary" means any corporation of which at least a majority of the
outstanding stock having ordinary voting power to elect a majority of the
directors of such corporation, irrespective of whether or not at the time stock
of any other class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency, is at the time
directly or indirectly owned by the Company, by one or more Subsidiaries of the
Company, or by the Company and one or more Subsidiaries. The term
"Wholly-Owned Subsidiary" means a Subsidiary of which all of the outstanding
voting stock (other than directors' qualifying shares) is at the time directly
or indirectly owned by the Company, or by one or more Wholly-Owned
Subsidiaries, or by the Company and one or more Wholly Owned Subsidiaries.
"TIA" means the federal Trust Indenture Act of 1939, as amended by the
Trust Indenture Reform Act of 1990, and as in effect on the date as of which
this Indenture was executed.
"Trustee" means the Person named as the "Trustee" in the first paragraph
of this instrument until a successor Trustee shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Trustee" shall
mean such successor Trustee.
Section 1.02. Compliance Certificates and Opinions. Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent, if any, provided
for in this Indenture (including any covenants for which compliance therewith
constitutes a condition precedent) 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, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) 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;
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(3) a statement that, in the opinion of each such individual,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.03. Form of Documents Delivered to Trustee. In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.04. Acts of Debentureholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Debentureholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Debentureholders in person or by agent duly appointed in writing; and,
except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee, and,
where it is hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Debentureholders signing such
instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this
Indenture and, subject to Section 6.01, conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing is not required to be certified by a notary public or
other similar official but may be conclusively proved by the affidavit of a
witness of such execution, by a signature guaranteed by a commercial bank or a
member firm of the New York Stock Exchange, or by the certificate of any notary
public or other officer authorized by law to take acknowledgments of deeds to
the effect that the individual signing such instrument or writing acknowledged
to him the execution thereof. Where such execution is by an officer of a
corporation or a member of a partnership, on behalf of such corporation or
partnership, any such certificate or affidavit shall
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also constitute sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of the person
executing the same, may also be provided.
(c) The ownership of Debentures shall be proved by the Debenture Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Debenture shall bind the Holder of every
Debenture issued upon the transfer thereof or in exchange therefor or in lieu
thereof, in respect of anything done or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is made
upon such Debenture.
Section 1.05. Notices, etc... to Trustee and Company. Any request,
demand, authorization, direction, notice, consent, waiver or Act of
Debentureholders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with either (1) the Trustee by
any Debentureholder or by the Company shall be sufficient for every purpose
hereunder if made, given, furnished or filed in writing to or with the Trustee
at its principal corporate trust office, or (2) the Company by the Trustee or
by any Debentureholder shall be sufficient for every purpose hereunder if in
writing and mailed, first class postage prepaid, to the Company addressed to
it, to the attention of its President, at the address of its principal office
specified in the first paragraph of this instrument or at any other address
furnished in writing to the Trustee by the Company.
Section 1.06 Notices to Debentureholders; Waiver. Where this Indenture
provides for notice to Debentureholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class postage prepaid, to each Debentureholder affected by
such event, at his address as it appears in the Debenture Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Debentureholders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed, to any particular Debentureholder shall affect the sufficiency of such
notice with respect to other Debentureholders. Where this Indenture provides
for notice in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by
Debentureholders shall be filed with the Trustee, but such filing shall not be a
condition precedent to the validity of any action taken in reliance upon such
waiver. In case, by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impractical to give such notice by mail
as required by this Indenture, then such notification as shall be made with the
approval of the Trustee shall constitute a sufficient notification for every
purpose hereunder.
Section 1.07 Record Date for Action by Debentureholders. Whenever in
this Indenture it is provided that holders of a specified percentage in
aggregate principal amount of the Debentures may take 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 Company, pursuant to a
resolution of its Board of Directors, or the Holders of at least 10% in
aggregate principal amount of the Debentures then outstanding, may request the
Trustee to fix a record date for determining Debentureholders entitled to notice
of and to take any such action. In case the Company or the holders of
Debentures in the amount above specified shall desire to request
Debentureholders to take any such action and shall request the Trustee to fix a
record date with respect thereto by written notice setting forth in reasonable
detail the Debentureholder action to be requested, the Trustee shall promptly
(but in any event within five days of receipt of such request) fix a record date
which shall be a business day not less than 15 nor more than 20 days after the
date on which the Trustee receives such request. If the Trustee shall fail to
fix a record date as hereinabove provided, then the
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Company or the Holders of Debentures in the amount above specified may fix the
same by mailing written notice thereof (the record date so fixed to be a
business day not less than 15 nor more than 20 days after the date on which such
written notice shall be given) to the Trustee. If a record date is fixed
according to this Section 1.07, only persons shown as Debentureholders on the
registration books of the Company at the close of business on the record date so
fixed shall be entitled to take the requested action and the taking of any such
action by the holders on the record date of the required percentage of the
aggregate principal amount of the Debentures shall be binding on all Debentures,
provided that the taking of the requested action by the Holders on the record
date of the percentage in aggregate principal amount of the Debentureholders
specified in this Indenture in connection with such action shall have been
evidenced to the Trustee not later than 180 days after such record date.
Section 1.08 Communications by Holders with Other Holders.
Debentureholders may communicate pursuant to Section 312(b) of the TIA with
other Holders with respect to their rights under this Indenture or the
Debentures, and the Company, the Trustee, the Registrar and anyone else shall
have the protection of Section 312(c) of the TIA.
Section 1.09 Affiliates of Company Exempt from Individual Liability.
No recourse under or upon any obligation, covenant or agreement of this
Indenture, or of any Debenture, or for any claim based thereon or otherwise in
respect thereof, shall be had against any incorporator, stockholder, officer or
director, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise, it being expressly understood that this Indenture and
the obligations issued hereunder are solely corporate obligations, and that no
such personal liability whatever shall attach to, or is or shall be incurred
by, the incorporators, stockholders, officers or directors, as such, of the
Company or of any successor corporation, or any of them, because of the
creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or in any of
the Debentures or implied therefrom; and that any and all such personal
liability of every name and nature, either at common law or in equity or by
constitution or statute of, and any and all such rights and claims against,
every such incorporator, stockholder, officer or director, as such, because of
the creation of the indebtedness hereby authorized, or under or by reason of
the obligations, covenants or agreements contained in this Indenture or in any
of the Debentures or implied therefrom are hereby expressly waived and released
as a condition of, and as a consideration for, the execution of this Indenture
and the issue of such Debentures; provided, however, that nothing herein shall
be taken to prevent recourse to and the enforcement of the liability, if any,
of any stockholder or subscriber to capital stock upon or in respect of shares
of capital stock of the Company not fully paid up.
Section 1.10 Payments Due on Saturdays, Sundays and Holidays.
Provisions Required by TIA to Control. In any case where the date of payment
of interest on or principal of the Debentures or the date fixed for redemption
of any Debenture shall not be a Business Day then payment of interest or
principal (and premium, if any) need not be made on such date, but may be made
on the next succeeding Business Day with the same force and effect as if made
on the date of payment or the date fixed for redemption, and no interest shall
accrue for the period after such date.
Section 1.11 Provisions Required by TIA to Control. If any provision
hereof limits, qualifies or conflicts with another provision included in this
Indenture by operation of any of Sections 310 to 317, inclusive, of the TIA,
such incorporated provision shall control.
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Section 1.12 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 same instrument.
Section 1.13 Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
Section 1.14 All covenants and agreements in this Indenture by the
Company shall bind its successors and assigns, whether so expressed or not.
Section 1.15 Separability Clause. In case any provision in this
Indenture or in the Debentures 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. Benefits of Indenture. Nothing in this Indenture or in the
Debentures, express or implied, shall give to any Person, other than the
parties hereto and their successors hereunder and the Debentureholders, any
benefit or any legal or equitable right, remedy or claim under this Indenture.
Section 1.17. Governing Law. This Indenture and the Debentures shall be
governed by and construed in accordance with the laws of the State of Michigan,
except that the rights, duties and liabilities of the Trustee hereunder shall
be governed by and construed in accordance with the laws of the State of North
Carolina.
ARTICLE TWO
Debenture Forms
Section 2.01. Forms Generally. The Debentures and the Trustee's
certificates of authentication shall be in substantially the form of Exhibit A,
with such appropriate insertions, omissions, 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 may be required to comply with the rules of any securities exchange,
or as may, consistently herewith, be determined by the officers executing such
Debentures, as evidenced by their execution of the Debentures. Any portion of
the text of any Debenture may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Debenture.
The definitive Debentures shall be printed, lithographed or engraved or
produced by any combination of these methods on steel engraved borders or in
such other manner as the Company may deem appropriate, all as determined by the
officers executing such Debentures, as evidenced by their execution of such
Debentures.
Section 2.02 Title and Terms. The aggregate principal amount of
Debentures which may be authenticated and delivered under this Indenture is
limited to $20,000,000, except for Debentures authenticated and delivered upon
transfer of, or in exchange for, or in lieu of other Debentures pursuant to
Sections 2.05, 2.06, 2.07, 3.03 and 7.05.
The Debentures shall be known and designated as the __% Subordinated
Debentures, Series 1997, due June 1, 2003, of the Company. The Debentures
shall bear interest from the date and at the rate per
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annum specified in, and such interest shall be payable on the dates specified
in, the form of Debenture set forth in Exhibit A until the principal thereof is
paid or made available for payment.
All interest payments to be made to registered holders of Debentures shall
be paid directly by the Company to the Trustee, and the Trustee shall mail
these interest payments to the Debentureholders that are listed in the
Debenture Register by the Interest Payment Date. The principal of the
Debenture shall be payable at the office or agency of the Trustee ("Place of
Payment") maintained for such purposes in Charlotte, North Carolina, or in such
other office or agency as may be established by the Company pursuant to Section
8.02.
The Debentures shall not be redeemable prior to their Stated Maturity
except as provided in Article Three. The Debentures shall be subordinated in
right of payment to certain other Indebtedness of the Company as provided in
Article Nine.
Section 2.03 Denominations. The Debentures shall be issuable only in
fully registered form, without coupons, and in denominations of $1,000 and
integral multiples thereof.
Section 2.04 Execution, Authentication and Delivery and Dating. The
Debentures shall be executed on behalf of the Company by its Chairman of the
Board, its President or one of its Executive Vice Presidents, Senior Vice
Presidents or Vice Presidents under its corporate seal reproduced thereon and
attested by its Secretary or one of its Assistant Secretaries. The signature of
any of these officers on the Debentures may be manual or facsimile. Debentures
bearing the manual or facsimile signatures of individuals who were at any time
the proper officers of the Company shall bind the Company, notwithstanding that
such individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Debentures or did not hold such offices at
the date of such Debentures.
The Debentures shall be dated the date of their authentication. At any
time and from time to time after execution and delivery of this Indenture, the
Company may deliver Debentures executed by the Company to the Trustee, together
with a Company Order for the authentication and delivery of such Debentures;
and the Trustee in accordance with such Company Order shall authenticate and
deliver such Debentures as in this Indenture provided, and not otherwise.
No Debenture shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Debenture a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature of one of its Authorized Officers,
and such certificate upon any Debenture shall be conclusive evidence, and the
only evidence, that such Debenture has been duly authenticated and delivered
hereunder.
The Trustee may appoint an authenticating agent reasonably acceptable to
the Company to authenticate Debentures. Unless limited by the terms of such
appointment, an authenticating agent may authenticate Debentures whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent.
Section 2.05 Temporary Debentures. Pending the preparation of
definitive Debentures, the Company may execute and upon Company Order the
Trustee shall authenticate and deliver, temporary Debentures which are printed,
lithographed, typewritten, mimeographed or otherwise produced in any
denomination, substantially of the tenor of the definitive Debentures in lieu
of which they are issued and with
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such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Debentures may determine, as evidenced by their
execution of such Debentures.
If temporary Debentures are issued, the Company will cause definitive
Debentures to be prepared without unreasonable delay. After the preparation of
definitive Debentures, the temporary Debentures shall be exchangeable for
definitive Debentures upon surrender of the temporary Debentures at the office
or agency of the Company in a Place of Payment, without charge to the Holder.
Upon surrender for cancellation of any one or more temporary Debentures the
Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a like principal amount of definitive Debentures of
authorized denominations. Until so exchanged the temporary Debentures shall in
all respects be entitled to the same benefits under this Indenture as
definitive Debentures.
Section 2.06 Registration, Transfer and Exchange. The Company shall
cause to be kept at the principal corporate trust office of the Trustee (or at
any other office or agency maintained by the Company as a Place of Payment) a
register (herein sometimes referred to as the "Debenture Register") in which,
subject to such reasonable regulations as it or the Trustee may prescribe, the
Company shall provide for the registration of Debentures and of transfers of
Debentures. The Trustee is hereby initially appointed "Debenture Registrar" for
the purpose of registering Debentures and transfers of Debentures as herein
provided.
A Debentureholder may surrender any Debenture for transfer at the office
or agency of the Company in a Place of Payment. The Company shall execute, and
the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Debentures of any authorized
denominations, of a like aggregate principal amount. At the option of the
Holder, Debentures may be exchanged for other Debentures of any authorized
denominations, of a like aggregate principal amount, upon surrender of the
Debentures to be exchanged at such office or agency. Whenever any Debentures
are so surrendered for exchange, the Company shall execute, and the Trustee
shall authenticate and deliver, the Debentures which the Debentureholder making
the exchange is entitled to receive. All Debentures issued upon any transfer
or exchange of Debentures shall be the valid obligations of the Company if its
requirements for such transactions are met, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Debentures
surrendered upon such transfer or exchange.
Every Debenture presented or surrendered for transfer or exchange by a
Person shall, if so required by the Company or the Trustee, be duly endorsed or
be accompanied by a written instrument of transfer in form satisfactory to the
Company and the Debenture Registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing.
No service charge shall be made for any transfer or exchange of
Debentures, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Debentures, other than exchanges pursuant to Sections
2.05, 3.02 or 7.05 not involving any transfer.
Section 2.07 Mutilated, Destroyed, Lost and Stolen Debentures. If (i)
any mutilated Debenture is surrendered to the Trustee, or the Company and the
Trustee received evidence to their satisfaction of the destruction, loss or
theft of any Debenture, and (ii) there is delivered to the Company and the
Trustee such security or indemnity as may be required by them to save each of
them harmless, then, in the absence of notice to the Company or the Trustee that
such Debenture has been acquired by a bona fide purchaser, the
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Company shall execute and upon its request the Trustee shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Debenture, a new Debenture of like tenor and principal amount, bearing a
number not contemporaneously outstanding. In case any such mutilated,
destroyed, lost or stolen Debenture has become or is about to become due and
payable, the Company in its discretion may, instead of issuing a new Debenture,
pay such Debenture.
Upon issuance of any new Debenture under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses,
including the fees and expenses of the Trustee, connected therewith.
Every new Debenture issued pursuant to this Section in lieu of any
destroyed, lost or stolen Debentures shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Debenture shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Debentures duly issued hereunder. The provisions of this
Section are exclusive and shall preclude, to the extent lawful, all other
rights and remedies with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Debentures.
Section 2.08. Payment of Interest; Interest Rights Preserved. Interest
on any Debenture which is payable, and is punctually paid or duly provided for,
on any Interest Payment Date shall be paid to the Person in whose name that
Debenture (or one or more Predecessor Debentures) is registered at the close
of business on the Regular Record Date for such interest payment specified in
this Section 2.08.
Any interest on the Debenture which is payable, but is not punctually paid
or duly provided for, on any Interest Payment Date shall accrue at a rate per
annum that is equal to one percent (1%) per annum plus the interest rate stated
in the Debenture until the same is paid in full (herein called "Defaulted
Interest"). The Defaulted Interest shall forthwith cease to be payable to the
registered Holder on the relevant Regular Record Date by virtue of having been
such Holder; and, except as hereinafter provided, such Defaulted Interest may
be paid by the Company, at its election in each case, as provided in Clause (1)
or Clause (2) below:
(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Debentures (or their respective
Predecessor Debentures) 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 Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be
paid on each Debenture and the date of the proposed payment, and at the
same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money
when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this Clause provided.
Thereupon the Trustee shall fix a Special Record Date for the payment of
such Defaulted Interest which shall be not more than 15 nor less than ten
days prior to the date of the proposed payment and not less than ten days
after the receipt by the Trustee of the notice of the proposed payment.
The Trustee shall promptly notify the Company of such Special Record Date
and, in the name and at the expense of the Company, shall cause notice of
the proposed payment of such Defaulted Interest and the Special Record
Date therefor to be mailed, first class postage prepaid, to each
Debentureholder at the address as it appears in the Debenture Register,
not less than ten days prior to such Special Record Date. Notice of
proposed payment of such
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Defaulted Interest and the Special Record Date therefor having been mailed
as aforesaid, such Defaulted Interest shall be paid to the Persons in
whose names the Debentures (or their respective Predecessor Debentures)
are registered on such Special Record Date and shall no longer be payable
pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which the Debentures may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this Clause,
such payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Debenture
delivered under this Indenture upon transfer of or in exchange for or in lieu
of any other Debenture shall carry the rights to interest accrued and unpaid,
and to accrued interest, which were carried by such other Debenture. The
Regular Record Date referred to in this Section for the payment of interest
payable, and punctually paid or duly provided for, on any Interest Payment Date
shall be the close of business on the first day of the calendar month preceding
the month in which falls an Interest Payment Date.
The Company shall maintain an office or agency where Debentures may be
presented for payment (the "Paying Agent"), and the Company may have one or
more additional paying agents. The Company shall notify the Trustee of the
name and address of any such additional Paying Agent. The Company hereby
initially appoints the Trustee as Paying Agent.
All payments of interest on the Debentures to the Persons entitled
thereto, whether made by the Company, the Trustee or any Paying Agent, as
authorized pursuant to this Indenture, shall be made (subject to collection) by
check mailed to the address of the Person entitled thereto, as such address
shall appear on the Debenture Register, unless the Trustee determines such
method of payment to be inappropriate in the circumstances.
Section 2.09. Persons Deemed Owners. The Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in whose name any
Debenture is registered as the owner of such Debenture for the purpose of
receiving payment of principal of, and (subject to Section 2.08) interest on,
such Debenture and for all other purposes whatsoever, whether or not such
Debenture is overdue, and neither the Company, the Trustee, nor any agent of the
Company or the Trustee shall be affected by notice to the contrary.
Section 2.10. Cancellation. All Debentures surrendered for payment,
redemption, transfer or exchange shall, if surrendered to any Person other than
the Trustee, be delivered to the Trustee and, if not already cancelled, shall be
promptly cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Debentures previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all Debentures
so delivered shall be promptly cancelled by the Trustee. No Debentures shall be
authenticated in lieu of or in exchange for any Debentures cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Debentures held by the Trustee shall be disposed of as directed by a Company
Order.
Section 2.11 Authentication and Delivery of Original Issue. Forthwith
upon the execution and delivery of this Indenture, or from time to time
thereafter, Debentures up to the aggregate principal amount
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of $20,000,000 may be executed by the Company and delivered to the Trustee for
authentication, and shall thereupon be authenticated and delivered by the
Trustee upon Company Order, without any further action by the Company.
Section 2.12 Computation of Interest. Interest on the Debentures shall
be computed on the basis of a 360-day year of twelve 30-day months.
ARTICLE THREE
Redemption
Section 3.01 Optional Redemption. (a) The Company may redeem all of the
Debentures at any time on or after June 1, 1999, or some of them from time to
time on or after June 1, 1999, at the redemption prices (expressed in
percentages of the principal amount to be redeemed) set forth in Exhibit A to
this Indenture, plus accrued interest to the redemption date. If the Company
elects to redeem the Debentures in whole or in part, it shall notify the Trustee
of the desired redemption date and the principal amount of Debentures to be
redeemed. If less than all of the Debentures are to be redeemed, the Trustee
shall select the Debentures to be redeemed either pro-rata or by lot, as the
Trustee in its sole discretion shall choose. Debentures shall be redeemed only
in denominations of $1,000 or integral multiples thereof.
(b) At least 30 days but not more than 60 days prior to a redemption date
the Company shall mail, or shall cause the Trustee to mail, a notice of
redemption by first-class mail to each Holder of Debentures to be redeemed.
The notice shall identify the Debentures to be redeemed and shall state (1) the
redemption date and redemption price, (2) the name and address of the Paying
Agent, (3) in the event that a Debenture is to be redeemed in part only, the
portion of the principal amount thereof to be redeemed, and that on and after
the redemption date, upon surrender of the Debenture a new Debenture, equal in
principal amount to the unredeemed portion thereof, will be issued, (4) that
Debentures called for redemption must be surrendered to the Paying Agent to
collect the redemption price and (5) that interest on the Debentures to be
redeemed ceases to accrue on and after the redemption date.
Section 3.02 Mandatory Redemption. (a) On each March 1, commencing with
March 1, 1999 (each a "Mandatory Redemption Date"), upon request for redemption
as provided herein, the Company shall redeem up to $25,000 principal amount of
Debentures held by a Holder, or on behalf of a deceased Holder, but not more
than $100,000 in the aggregate for all Holders in any calendar year, in integral
multiples of $1,000 in excess of the minimum authorized denomination, as
requested in the manner and subject to the limitations, set forth below. The
redemption price for Debentures to be redeemed pursuant to this Section will be
100% of the principal amount thereof for Debentures to be redeemed on behalf of
a deceased Holder, and shall be 95% of the principal amount thereof in the case
of all other Holders, together with accrued interest thereon through the
Mandatory Redemption Date. Any request for redemption must be received on or
before December 1 of each calendar year and shall be made to the Trustee. The
Trustee shall promptly forward a copy thereof to the Company within five (5)
days of receipt, and await further direction from the Company concerning the
redemption request.
A request for redemption under this Section shall contain (1) a written
request for redemption of the Debentures signed by a Holder or by the duly
authorized representative of the Holder, which request shall set forth the name
of any Holder or deceased Holder, the date of death of any deceased Holder, and
the principal amount of the Debentures to be repaid up to $25,000, (2) the
Debenture or Debentures to be redeemed and (3) evidence of the death of any
deceased Holder and the authority of his or her representative.
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In applying the annual aggregate redemption limit of $100,000 which is set
forth above, the Company and the Trustee shall give priority to the redemption
of Debentures as follows: (i) first, to requests for redemption received prior
to each December 31 on behalf of deceased Debentureholders by the Trustee, on a
pro rata basis, and (ii) second, to all other Holders of the Debentures, on a
pro rata basis.
(b) Debentures shall not be entitled to redemption pursuant to this
Section unless all of the following conditions are met, as applicable:
(1) the Debentures to be redeemed have been registered on the
Debenture Register in the name of the Holder or the deceased Holder at
least six months prior to the date of the request for redemption; and
(2) the Trustee has been notified in writing of the request for
redemption within one year after a deceased Holder's death; and
(3) the Company is not, or, after giving effect to such payment
would not be, in default under any Senior Indebtedness.
(c) Following the request of a Holder or a deceased Holder's authorized
representative to redeem particular Debentures, the Company shall have 30 days
in which to determine whether the redemption request has been duly made and
whether the conditions to redemption set forth in this Section 3.02 have been
met, before becoming obligated to redeem the Debentures in accordance with
Section 3.03.
(d) After receiving an initial redemption payment, a Holder or a deceased
Holder's authorized representative annually may request additional redemption
of Debentures originally held by the deceased Holder in the principal amount of
up to $25,000 each year, subject to the further limitation that Holders other
than those representing a deceased Holder may not have more than $50,000
principal amount of Debentures redeemed in the aggregate. Such additional
redemption requests shall be made prior to the December 1 preceding a Mandatory
Redemption Date, and will be honored by the Company in accordance with Section
3.03 on the next March 1 thereafter, if all of the conditions in this Section
3.02 have been met.
(e) Authorized representatives of a Holder shall include the following:
executors, administrators, or other legal representatives of an estate;
trustees of a trust; joint owners of Debentures owned in joint tenancy or
tenancy by the entirety; custodians; conservators; guardians;
attorneys-in-fact; and other persons generally recognized as having legal
authority to act on behalf of another.
(f) For purposes of this Section 3.02, the death of a Person owning a
Debenture in joint tenancy or tenancy by the entirety with another or others
shall be deemed the death of the Holder of the Debenture, and the entire
principal amount of the Debenture so held shall be subject to repayment,
together with interest accrued thereon to the repayment date, subject to the
limitations and in accordance with the provisions of this Section 3.02 and
Section 3.03. For purposes of this Section 3.02, the death of a Person owning
a Debenture by tenancy in common shall be deemed the death of a Holder of a
Debenture only with respect to the deceased Holder's interest in the Debenture
so held by tenancy in common; except that in the event a Debenture is held by
husband and wife as tenants in common, the death of either shall be deemed the
death of the Holder of the Debenture, and the entire principal amount of the
Debenture so held shall be subject to repayment in accordance with the
provisions of this Section 3.02. A Person who, during such Person's lifetime,
was entitled to substantially all of the beneficial interests of ownership of a
Debenture will, upon
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such person's death, be deemed the Holder thereof for purposes of this Section
3.02, regardless of the registered holder, if such beneficial interest can be
established to the satisfaction of the Company. Such beneficial interest will be
deemed to exist in typical cases of nominee ownership, ownership under the
Uniform Gifts to Minors Act, community property or other joint ownership
arrangements between a husband and wife, and trust arrangements where one Person
has substantially all of the beneficial ownership interests in the Debenture
during such Person's lifetime. Beneficial interests shall include the power to
sell, transfer, or otherwise dispose of a Debenture and the right to receive the
proceeds therefrom, as well as interest and principal payable with respect
thereto.
Section 3.03 Redemption of Debentures. Within 30 days of the date a
request for redemption pursuant to Section 3.02 is first received, the Company
shall: (a) examine evidence of the death of any deceased Holder and the
authority of the deceased Holder's representative, and otherwise determine if
the request for redemption has been duly made in accordance with Section 3.02;
and (b) determine if the conditions to repayment set forth in Section 3.02 have
been met. If the Company shall determine that redemption may not be made in
accordance with Section 3.02, the Company shall direct the Trustee to so inform
the Holder or the deceased Holder's authorized representative and to return the
Debenture or Debentures to him. If the Company shall determine that the request
for redemption has been properly made and that all conditions to redemption set
forth in Section 3.02 have been met, the Company immediately shall notify the
Trustee in writing stating the amount of Debentures to be redeemed, the
redemption price and that the Debenture or Debentures will be redeemed on the
next March 31 thereafter, and the Company and the Trustee shall cause the
Debenture or Debentures to be redeemed as follows:
(1) At least 15 days before the Mandatory Redemption Date, the Trustee, in
the Company's name and at the Company's expense, shall mail a notice of
redemption by first class mail to each Holder whose Debentures are to be
redeemed. The notice shall state the amount of such Debentures to be redeemed,
the redemption price, and, if only a portion of a principal amount of any
Debenture is to be redeemed, after the Mandatory Redemption Date that a new
Debenture or Debentures in principal amount equal to the unredeemed portion
thereof will be issued.
(2) The Company shall deposit with the Trustee or with a Paying Agent or,
if the Company is acting as its own Paying Agent, segregate and hold in trust
as provided in Section 8.03, an amount of money sufficient to pay the
redemption price for all Debentures which are to be redeemed, together with
interest accrued thereon to the Mandatory Redemption Date, exclusive of
installments of interest whose stated maturity is on or prior to the Mandatory
Redemption Date, payment of which shall have been made or duly provided for to
the registered holders of the Debentures on the relevant Record Dates according
to their terms and the provisions of Section 2.08. The Debentures so to be
redeemed shall become due and payable on the Mandatory Redemption Date with
respect to each such Debenture at the amount to be repaid as provided above and
from and after the Mandatory Redemption Date. Such Debentures shall cease to
bear interest unless the Company shall default in such repayment.
(3) Immediately upon deposit with the Trustee or with a Paying Agent or,
if the Company is acting as its own Paying Agent, upon segregation and holding
in trust, of the amounts as provided above with respect to each Debenture or
portion thereof, the Company shall cause such Debenture or portion thereof to
be redeemed. Installments of interest whose stated maturity is on or prior to
the Mandatory Redemption Date shall be payable to the holders of such
Debentures registered as such on the relevant Record Dates according to their
terms and the provisions of Section 2.08.
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(4) If any Debenture duly requested to be repaid shall not be redeemed in
full upon the Mandatory Redemption Date, the remaining unpaid principal thereof
shall, until paid, bear interest from the Mandatory Redemption Date at the rate
borne by the Debenture.
Section 3.04. Debentures Redeemed in Part. The Company shall execute and
the Trustee shall authenticate and deliver, with respect to any Debenture
surrendered pursuant to Sections 3.01 or 3.02 and to be redeemed only in part,
to the Holder of such Debenture, without service charge, a new Debenture or
Debentures, of like series and 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 Debenture so surrendered and redeemed
in part. Notwithstanding any provision to the contrary in this Section 3.04, if
the unredeemed portion is less than the smallest authorized denomination, the
Company shall be obligated to pay the Holder such amount in cash in the same
manner as the redeemed portion. If required by the Company or the Trustee, such
Debenture so surrendered shall be duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Trustee duly
executed by, the Holder thereof or such Holder's attorney duly authorized in
writing.
ARTICLE FOUR
Satisfaction and Discharge
Section 4.01. Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect (except as to any surviving rights of
transfer or exchange of Debentures herein expressly provided for), and the
Trustee, on demand of and at the expense of the Company, shall execute the
proper instrument acknowledging satisfaction and discharge of this Indenture
when
(1) either (A) all Debentures theretofore authenticated and delivered,
other than (i) Debentures which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 2.07, and (ii)
Debentures for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as provided in
Section 8.03, have been delivered to the Trustee canceled or for
cancellation; or (B) all such Debentures not theretofore delivered to the
Trustee canceled or for cancellation have become due and payable, or will
become due and payable at their Stated Maturity within one year and the
Company has deposited or caused to be deposited with the Trustee in trust
an amount sufficient to pay and discharge the entire indebtedness on such
Debentures not theretofore delivered to the Trustee canceled or for
cancellation, for principal and interest to the Stated Maturity; and
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture
have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.07 shall survive.
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Section 4.02. Appliction of Trust Money. All money deposited with the
Trustee pursuant to Section 4.01 shall be held in trust and applied by it, in
accordance with the provisions of the Debentures and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent), to the Persons entitled thereto, of the
principal and interest for whose payment such money has been deposited with the
Trustee; but such money need not be segregated from other funds except to the
extent required by law.
ARTICLE FIVE
Remedies
Section 5.01. Events of Default. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be
effected by operation of law pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):
(1) default in the payment of the principal of any Debenture at its
Maturity, upon redemption, whether or not such default is due to the
application of any provision of Article Nine hereof; or
(2) default in the payment of any interest upon any Debenture when it
becomes due and payable, and continuance of such default for a period of
10 days after there has been given, by registered or certified mail, to
the Company by the Trustee, a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a
"Notice of Default" hereunder, whether or not such default is due to the
application of any provision of Article Nine hereof; or
(3) default by the Company of any other covenant or warranty of the
Company in this Indenture and continuance of such default or breach for a
period of 30 days after there has been given, by registered or certified
mail, to the Company by the Trustee, or to the Company and the Trustee by
the Holders of at least 10% in principal amount of the Outstanding
Debentures, a written notice specifying such default or breach and
requiring it to be remedied and stating that such notice is a "Notice of
Default" hereunder; or
(4) default by the Company or any of its Subsidiaries in the payment at
stated maturity of any Indebtedness for money borrowed (which shall not
include, among other things, deposits, capitalized lease obligations, or
advances for escrow accounts) with a principal amount due at maturity of
$500,000 or more and such default shall continue, without having been
satisfied, cured, waived or consented to, beyond any applicable period of
grace; or the occurrence of an event of default under any mortgage,
indenture or instrument under which there may be issued or by which there
may be secured or evidenced any Indebtedness for money borrowed by the
Company, MCA Mortgage or MCA (or the payment of which is guaranteed by
the Company, MCA Mortgage or MCA), whether such Indebtedness or guarantee
now exists or shall be created hereafter; provided, however, that no such
event of default shall constitute an Event of Default hereunder unless
the effect of such event of default is to cause the acceleration of such
Indebtedness prior to its expressed maturity, which together with the
principal amount of any such other Indebtedness so caused to be
accelerated, aggregates $500,000 or more at any one point in time and
such default shall not have been cured or waived and such acceleration
shall not have been rescinded or annulled, or such Indebtedness has been
accelerated within a period of 10 days after there shall have been given,
by registered or certified mail, to the Company by the Trustee, or to the
Company and the Trustee by the holders of
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at least 10% in principal amount of the Outstanding Debentures a written
notice specifying such default and requiring the Company to cause such
acceleration to be rescinded or annulled or cause such Indebtedness to
be discharged and stating that such notice is a "Notice of Default"; or
(5) entry of a decree or order by a court having jurisdiction in the
premises adjudging the Company or any of its Subsidiaries insolvent, or
approving as properly filed an involuntary petition seeking
reorganization, readjustment, arrangement, composition or similar relief
for the Company or any of its Subsidiaries under the federal bankruptcy
laws, or any other similar applicable law of any governmental unit,
domestic or foreign, and such decree or order shall have continued
undischarged or unstayed for a period of 60 days; or a decree or order or
other decision of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of any Person to act as
a receiver or conservator or liquidator or trustee or assignee in
bankruptcy or insolvency of the Company or any of its Subsidiaries or of
a substantial part of the property of any of them, or for the involuntary
winding down or liquidation of their respective affairs, shall have been
entered and such decree or order shall have remained in force
undischarged and unstayed for a period of 60 days; or, under the
provisions of any insolvency, bankruptcy, or other law for the relief or
aid of creditors or depositors, any court, or agency or supervisory
authority having jurisdiction in the premises shall assume custody or
control of the Company or any of its Subsidiaries or of a substantial
part of the property of any of them, and such custody and control shall
not be terminated or stayed within 60 days from the date of assumption of
such custody or control; or
(6) institution of proceedings by the Company or any of its Subsidiaries
to be adjudicated insolvent, or the consent to the filing of an
insolvency proceeding against either of them, or filing of a petition or
answer or consent seeking reorganization, readjustment, arrangement,
composition, appointment of a receiver or conservator or similar relief
under the federal insolvency laws, or any other similar applicable law of
any governmental unit, domestic or foreign, or the consent to the filing
of any such petition or the consent to the appointment of a receiver or
conservator or liquidator or trustee or assignee in insolvency of either
of them or of a substantial part of the property of either of them, or
making of an assignment for the benefit of creditors, or admitting in
writing an inability to pay its respective debts generally as they become
due, or voluntarily suspending transaction of its respective business
(other than in connection with a labor dispute), or any corporate action
taken by the Company or any of its Subsidiaries in furtherance of any of
the aforesaid purposes.
Section 5.02. Acceleration of Maturity; Recission and Annulment. If an
Event of Default occurs and is continuing, then and in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Debentures Outstanding may declare the principal of all the Debentures to be
due and payable immediately, by a notice in writing to the Company, and to the
Trustee if given by Debentureholders, and upon any such declaration such
principal shall become immediately due and payable.
At any time after such a declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article provided, the Holders of a majority
in principal amount of the Debentures Outstanding, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if -
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay (A) all overdue installments of interest on all
Debentures, (B) the principal of any Debentures which have
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become due otherwise than by such declaration of acceleration and
interest thereon at the rate borne by the Debentures, (C) to the extent
that payment of such interest is lawful, interest upon overdue
installments of interest at the rate borne by the Debentures, and (D) all
sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel; and
(2) all Events of Default, other than the non-payment of the
principal of Debentures which have become due solely by such
acceleration, have been cured or waived as provided in Section 5.12.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Trustee. The Company covenants that if
(1) default is made in the payment of the principal of any
Debenture at the Maturity thereof, or
(2) default is made in the payment of any installment of
interest on any Debenture when such interest becomes due and payable and
such default continues for a period of 10 days,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Debentures, the whole amount then due and payable on such
Debentures for principal and interest, with interest upon the overdue principal
and, to the extent that payment of such interest shall be legally enforceable,
upon overdue installments of interest, at the rate borne by the Debentures;
and, in addition thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amount forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may and at the
written request of holders of a majority in aggregate principal amount of the
Debentures outstanding and upon being indemnified to its satisfaction, shall,
institute a judicial proceeding for the collection of the sums so due and
unpaid, and may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Company or any other obligor upon the Debentures
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon the
Debentures, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may and at
the written request of holders of a majority in aggregate principal amount of
the Debentures outstanding and upon being indemnified to its satisfaction,
shall, in its discretion proceed to protect and enforce its rights and the
rights of the Debentureholders by such appropriate judicial proceedings as the
Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy.
Section 5.04. Trustee May File Proofs of Claim. In case of the
pendency of any receivership, conservatorship, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relating to the Company or its properties, irrespective of
whether the principal of the Debentures shall then be due and payable as
therein expressed or by declaration or otherwise and
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irrespective of whether the Trustee shall have made any demand on the Company
for the payment of over-due principal or interest, the Trustee shall be entitled
and empowered, by intervention in such proceeding or otherwise,
(1) to file and prove a claim for the whole amount of principal and
interest owing and unpaid in respect of the Debentures 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 the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel, and of the Debentureholders allowed in such judicial
proceeding, and
(2) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, liquidator, sequestrator, or other similar
official, in any such judicial proceeding is hereby authorized by each
Debentureholder to make such payments to the Trustee, and in the event that the
Trustee shall consent to the making of such payments directly to the
Debentureholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 6.07.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Debentureholder any
plan of reorganization, arrangement, adjustment or composition affecting the
Debentures or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Debentureholder in any such proceeding.
Section 5.05. Trustee May Enforce Claims Without Possession of
Debentures. All rights of action and claims under this Indenture or the
Debentures may be prosecuted and enforced by the Trustee without the possession
of any of the Debentures or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Debentures in respect of which such
judgment has been recovered.
Section 5.06 Applications of Money Collected. Any money collected by
the Trustee pursuant to this Article shall be applied in the following order,
at the date or dates fixed by the Trustee and, in case of the distribution of
such money on account of principal or interest, upon presentation of the
Debentures and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 6.07;
SECOND: In case the principal of the Debentures shall not have
become due, to the payment of interest on the Debentures, 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 borne by the Debentures,
such payments to be made ratably to the Persons entitled thereto, without
discrimination or preference;
THIRD: In case the principal of the Debentures shall have become due, by
declaration or otherwise, to the payment of the whole amount then owing
and unpaid upon the Debentures for
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principal and interest, with interest on the overdue principal and, to
the extent that such interest has been collected by the Trustee, upon
overdue installments of interest at the rate borne by the Debentures; and
in case such moneys shall be insufficient to pay in full the whole
amount so due and unpaid upon the Debentures, then to the payment of
such principal and interest, without preference of priority of principal
over interest, or of interest over principal, or of any installment of
interest over any other installment of interest, or of any Debenture over
any other Debenture, ratably to the aggregate of such principal and
accrued and unpaid interest; and
FOURTH: The remainder, if any, shall be paid to the Company, its
successors or assigns, or to whomsoever may be lawfully entitled to
receive the same, or as a court of competent jurisdiction may direct.
Section 5.07. Limitations on Suits. No Holder of any Debenture shall
have any right to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(2) the Holders of not less than 25% in aggregate principal
amount of the Outstanding Debentures shall have made a written request
to the Trustee to institute proceedings in respect of such Event of
Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority in principal amount of the Outstanding Debentures;
it being understood and intended that no one or more Holders of Debentures
shall have any right in any manner whatever by virtue of, or by availing of,
any provision of this Indenture to affect, disturb or prejudice the rights of
any other Holders of Debentures, or to obtain or to seek to obtain priority or
preference over any other Holders or to enforce any right under this Indenture,
except in the manner herein provided and for the equal and ratable benefit of
all the Holders of Debentures.
Section 5.08. Right of Debentureholders to Receive Principal and
Interest. Notwithstanding any other provision in this Indenture, the Holder of
any Debenture shall have the right to receive payment of the principal of and,
subject to Section 2.08, interest on such Debenture on the respective Stated
Maturities expressed in such Debenture and to institute suit for the
enforcement of any such payment, and such right shall not be impaired without
the consent of such Holder.
Section 5.09. Restoration of Rights and Remedies. If the Trustee or any
Debentureholder has instituted any proceeding to enforce any right or remedy
under this Indenture and such proceeding has been
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discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Debentureholder, then and in every such case the
Company, the Trustee and the Debentureholders shall, subject to any
determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee and the Debentureholders shall continue as though no such proceeding
had been instituted.
Section 5.10. Rights and Remedies Cumulative. Except as provided in
Section 2.07, no right or remedy herein conferred upon or reserved to the
Trustee or to the Debentureholders is intended to be exclusive of any other
right or remedy, and every right and remedy shall, to the extent permitted by
law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
Section 5.11. Delay or Omission Not Waiver. No delay or omission of the
Trustee or of any Holder of any Debenture to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or in acquiescence therein.
Every right and remedy given by this Article or by law to the Trustee or to the
Debentureholders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Debentureholders, as the case may be.
Section 5.12. Rights of Holders to Direct Trustee and to Waive Defaults.
The holders of a majority in aggregate principal amount of the Debentures at
the time Outstanding or, if a record date is set in accordance with Section
1.07, as of such record date, 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; provided, however,
that subject to the provisions of Section 6.01, the Trustee shall have the right
to decline to follow any such direction if the Trustee being advised by counsel
shall determine that such action may not lawfully be taken, or if the Trustee in
good faith shall, by a responsible officer or officers of the Trustee, determine
that the proceedings so directed would be illegal or involve it in personal
liability or be unjustly prejudicial to the Debentureholders not consenting, and
provided further that nothing in this Indenture shall impair the right of the
Trustee in its discretion to take any action deemed proper by the Trustee and
which is not inconsistent with such direction by the Debentureholders. Prior to
the declaration of the maturity of the Debentures as provided in Section 5.02,
the Holders of a majority in aggregate principal amount of the Debentures at the
time Outstanding may on behalf of all Holders waive any past default hereunder
and its consequences, except a default in the payment of interest or premium on,
or the principal of, any of the Debentures. In the case of any such waiver the
Company, the Trustee and the Holders shall be restored to their former positions
and rights thereunder, respectively; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
Section 5.13. Undertaking for Costs. All parties to this Indenture
agree, and each Holder of any Debenture 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, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, 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 shall not apply to any
suit instituted by the Trustee, to any suit instituted by any Debentureholder,
or group of Debentureholders, holding in the aggregate more than 10% in
principal amount of the Outstanding
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Debentures, or to any suit instituted by a Debentureholder for the enforcement
of the payment of the principal of or interest on any Debenture.
ARTICLE SIX
The Trustee
Section 6.01. Certain Duties and Responsibilities. (a) In connection
with this Indenture,
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
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.
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent individual would exercise or use under the circumstances in the conduct
of his or her own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own grossly negligent action, its own grossly
negligent failure to act, or its own willful misconduct, except that
(1) this Subsection shall not be construed to limit the effect
of Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved that
the Responsible Officer was grossly negligent in ascertaining the
pertinent facts;
(3) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in principal amount of the
Outstanding Debentures 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; and
(4) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder, or in the exercise of
any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
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(d) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
Section 6.02. Notice of Defaults. Within 90 days after the Trustee has
actual knowledge of the occurrence of an Event of Default, the Trustee shall
transmit by mail to all Debentureholders, as their names and addresses appear in
the Debenture Register, notice of such Event of Default known to the Trustee,
unless such Event of Default shall have been cured or waived; provided, however,
that, except in the case of an Event of Default relating to the payment of the
principal of or interest on any Debenture, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Responsible Officers of the
Trustee in good faith determine that the withholding of such notice is in the
interests of the Debentureholders; and provided, further, that in the case of
any Event of Default of the character specified in Section 5.01(4) no such
notice to Debentureholders shall be given until at least 30 days after the
occurrence thereof.
Section 6.03. Certain Powers of Trustee. Except as otherwise
specifically provided in Section 6.01:
(a) the Trustee may conclusively rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, Debenture or
other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its
part, conclusively rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel 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, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Debentureholders pursuant to this Indenture, unless such Debenture-
holders shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, Debenture or
other paper or document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney; and
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(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.
Section 6.04. Not Responsible for Recitals or Issuance of Debentures.
The recitals contained herein and in the Debentures and any other statements
provided by the Company in connection with the issuance of the Debentures,
except the Trustee's written statements provided to the Company and the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Debentures. The Trustee shall not be accountable for the
use or application by the Company of the Debentures or the proceeds thereof.
Section 6.05. May Hold Debentures. The Trustee, any Paying Agent,
Debenture Registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Debentures and, subject to
Sections 6.07 and 6.12, if operative, may otherwise deal with the Company with
the same rights it would have if it were not Trustee, Paying Agent, Debenture
Registrar or such other agent.
Section 6.06. Money held by the Trustee in trust hereunder 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 money received by it hereunder
except as otherwise agreed with the Company.
Section 6.07. The Company agrees:
(1) to pay to the Trustee from time to time reasonable compensation for
all services rendered by it hereunder as may be agreed upon between the Company
and the Trustee (which compensation shall not be limited by any provision of
law in regard to the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision of
this Indenture (including the reasonable compensation and the expenses and
disbursements of its agents, counsel, accountants, appraisers and experts),
except any such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(3) to indemnify the Trustee and its officers, directors and employees
(the "Indemnitees") for, and to hold them harmless against, any loss, liability
or expense incurred without gross negligence or bad faith on the part of the
Indemnitees, arising out of or in connection with its acceptance or
administration of this trust, and the Trustee's duties hereunder, including the
costs and expenses of defending the Indemnitees against any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder. The indemnity provisions of this Section shall survive removal or
resignation of the Trustee.
As security for the performance of the obligations of the Company under
this Section, the Trustee shall have a lien prior to the Debentures 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) and of interest
on Debentures. The Trustee's right to receive payments due under this Section
6.07 shall not be subordinate to any other liability or indebtedness of the
Company, even though the Debentures may be so subordinated, and the Debentures
shall be subordinate to the Trustee's right to receive such payments. When the
Trustee incurs expenses or renders services in connection with an Event of
Default specified in 5.01(6), the expenses
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and compensation for the services are intended to constitute expenses of
administration under any bankruptcy law.
Section 6.08. Eligibility; Disqualification. There shall at all times
be a Trustee hereunder which shall be a corporation organized and doing business
under the laws of the United States of America or of any State, authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least $50,000,000, subject to supervision or examination by
federal or state authority. If such corporation publishes reports of condition
at least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purpose of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article. The
Trustee shall comply with Section 310(b) of the TIA, in the event that it has a
conflicting interest, as defined in such section. The Trustee confirms that it
has no such conflicting interest on the date of this Indenture.
Section 6.09. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.10.
(b) The Trustee may resign at any time by giving written notice
thereof to the Company. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Debentures, delivered to the
Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with its obligation to
resign, as provided by Section 6.08, after written request therefore by the
Company or any Debentureholder who has been a bona fide Holder of a
Debenture for at least six months, except in the case of a default in the
payment of the principal of or interest on any indenture security, or in
the payment of any sinking or purchase fund installment, the Trustee
shall not be required to resign as provided in paragraph (1) of this
subsection (d) if the Trustee shall have sustained the burden of proving,
on application to the Securities and Exchange Commission and after
opportunity for hearing thereon, that (A) the default under the Indenture
may be cured or waived during a reasonable period and under the
procedures described in such application, and (B) a stay of the Trustee's
duty to resign will not be inconsistent with the interests of holders of
the indenture securities. The filing of such an application shall
automatically stay the performance of the duty to resign until the
Securities and Exchange Commission orders otherwise, or
(2) the Trustee shall cease to be eligible under Section 6.08
and shall fail to resign after written request therefor by the Company or
by any such Debentureholder, or
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(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver or conservator of the
Trustee or of its property shall be appointed or any public officer shall
take charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation, or
(4) provided that no Event of Default shall have occurred and is
continuing, the Trustee shall have failed, in the good faith judgment of
the Company's Board of Directors, to adequately perform its duties
hereunder as Trustee and Paying Agent.
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) any Debentureholder who has been a bona fide Holder of a
Debenture for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Debentures
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment, become the
successor Trustee and supersede the successor Trustee appointed by the Company.
If no successor Trustee shall have been so appointed by the Company or the
Debentureholders and accepted appointment in the manner hereinafter provided,
any Debentureholder who has been a bona fide Holder of a Debenture for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee by mailing written
notice of such event within 30 days of the date thereof by first-class mail,
postage prepaid, to the Holders of Debentures as their names and addresses
appear in the Debenture Register. Each notice shall include the name of the
successor Trustee and the address of its principal corporate trust office.
Section 6.10. Acceptance of Appointment by Successor. Every successor
Trustee appointed hereunder shall execute, acknowledge and deliver to the
Company and to the retiring Trustee an instrument accepting such appointment,
and thereupon the resignation or removal of the retiring Trustee shall become
effective and such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee; but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee, and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder, subject nevertheless to its lien, if any, provided for in
Section 6.07. Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article, to the extent operative.
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Section 6.11. Merger, Conversion, or Succession to Business. Any
corporation or banking association into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation or banking
association resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation succeeding to all or substantially
all of the corporate trust business of the Trustee, shall be the successor of
the Trustee hereunder, provided such corporation or banking association shall be
otherwise qualified and eligible under this Article, to the extent operative,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.
Section 6.12. Preferential Collection of Claims Against Company. The
Trustee shall comply with Section 311(a) of the TIA, excluding any relationship
listed in Section 311(b) of the TIA, and a Trustee who has resigned or been
removed shall be subject to Section 311(a) of the TIA to the extent indicated.
Section 6.13. Reports by the Trustee. If required by Section 313(a) of
the TIA, the Trustee shall transmit to each person entitled to receive the same
under Section 313(c) of the TIA, on or before June 15 of each year, commencing
with June 15, 1998, a brief report, dated as of a date convenient to the Trustee
no more than 60 nor less than 45 days prior thereto, that complies with Section
313(a) of the TIA, and the Trustee shall also comply with Section 313(b) of the
TIA. The Company shall notify the Trustee in writing if the Debentures become
listed on any securities exchange, in which event a copy of each such report at
the time of its mailing to the Holders shall be filed with the Securities and
Exchange Commission and each securities exchange, if any, on which the
Debentures are listed. In such event the Company shall notify the Trustee in
writing of any delisting of the Debentures from any securities exchange.
Section 6.14. Lists of Debentureholders. The Trustee shall preserve in
as current form as is reasonably practicable, the most recent list available to
it of the names and addresses of Debentureholders. If the Trustee is not the
Debenture Registrar, the Company shall furnish to the Trustee on or before each
Interest Payment Date, and at such other times as the Trustee may request in
writing, a list, in such form and as of such date as the Trustee may reasonably
require, of the names and addresses of the Debentureholders. The Trustee may
destroy any list furnished to it upon receipt of a new list so furnished.
ARTICLE SEVEN
Supplemental Indentures
Section 7.01. Supplemental Indentures Without Consent of Debentureholders.
Without the consent of the Holders of any Debentures, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto (which shall
conform to the provisions of the TIA as in force at the date of the execution
thereof, if required), in form satisfactory to the Trustee, for any of the
following purposes:
(1) to evidence the succession of another entity to the
Company , and the assumption by any such successor of the covenants of the
Company herein and in the Debentures; or
(2) to add to the covenants of the Company, for the benefit of
the Holders of the Debentures, or to surrender any right or power herein
conferred upon the Company; or
(3) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, to modify, amend or supplement this Indenture in such
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a manner as will permit the qualification thereof under the TIA or to
make any other provisions with respect to matters or questions arising
under this Indenture which shall not be inconsistent with the provisions
of this Indenture, provided such action shall not adversely affect the
interests of the Holders of the Debentures.
Section 7.02. Supplemental With Consent of Debentureholders. With the
consent of the Holders of at least 50% in principal amount of the Outstanding
Debentures, by Act of said Holders delivered to the Company and the Trustee, the
Company, when authorized by a Board Resolution, and the Trustee may enter into
an indenture or indentures supplemental hereto (which shall conform to the
provisions of the TIA as in force at the date of the execution thereof, if
required) for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders of the Debentures under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Debenture affected thereby,
(1) change the Stated Maturity of the principal of, or any
installment of interest on, any Debenture, or reduce the principal amount
thereof or the interest thereon or change any Place of Payment where, or
the coin or currency in which, any Debenture or the interest thereon is
payable, or impair the right to institute suit for the enforcement of any
such payment on or after the Stated Maturity thereof, or, in the case of
redemption pursuant to Sections 3.01 or 3.02, on or after a redemption
date, or
(2) reduce the percentage in principal amount of the Outstanding
Debentures, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for
any waiver of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences provided for in this
Indenture, or
(3) modify any of the provisions of this Section or Section
5.12, except to increase any such percentage or to provide that certain
other provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each Debenture affected thereby, or
(4) subordinate the Indebtedness evidenced by the Debentures
to any Indebtedness of the Company other than Senior Indebtedness, as
provided in Article Nine, or
(5) impair or restrict the rights of the Holders of the
Debentures to repayment of Debentures prior to the Stated Maturity
thereof under the circumstances set forth in, and in accordance with the
provisions of, Section 3.02.
It shall not be necessary for any Act of Debentureholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
Section 7.03. Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and, subject to Section
6.01, shall be fully protected in relying upon, an Officer's Certificate and an
Opinion of Counsel. The Trustee may, but
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shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
Section 7.04. Effect of Supplemental Indentures. Upon the execution of
any supplemental indenture under this Article, this Indenture shall be modified
in accordance therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Debentures theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.
Section 7.05. Reference in Debentures to Supplemental Indentures.
Debentures authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article 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. If the Company shall so determine, new Debentures
so modified as to conform, in the opinion of the Trustee and the Board of
Directors, to any such supplemental indenture may be prepared and executed by
the Company and authenticated and delivered by the Trustee in exchange for
Outstanding Debentures.
Section 7.06. Effect on Senior Indebtedness. No supplemental indenture
shall adversely affect the rights of any holder of Senior Indebtedness under
Article Nine without the consent of such holder.
ARTICLE EIGHT
Covenants
Section 8.01. Payment of Principal and Interest. The Company will duly
and punctually pay the principal of and interest on the Debentures in
accordance with the terms of the Debentures and this Indenture.
Section 8.02. Maintenance of Office or Agency. The Company will
maintain an office or agency in each Place of Payment where Debentures may be
presented or surrendered for payment, where Debentures may be surrendered for
transfer or exchange and where notices and demands to or upon the Company in
respect of the Debentures and this Indenture may be served. The Company will
give prompt written notice to the Trustee of the location, and of any change in
the location, of such office or agency. If at any time the Company shall fail
to maintain such 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 principal corporate trust office of the Trustee, and the
Company hereby appoints the Trustee its agent to receive all such presentations,
surrenders, notices and demands.
Section 8.03. Money for Debenture Payments to be Held In Trust. If the
Company shall at any time act as its own Paying Agent, it will, on or before
each due date of the principal of or interest on, any of the Debentures,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal or interest so becoming due until such sums
shall be paid to such Persons or otherwise disposed of as herein provided, and
will promptly notify the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents, it will, prior
to each due date of the principal of or interest on, any Debentures, deposit
with a Paying Agent a sum sufficient to pay the principal or interest, so
becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal or interest, and, unless such Paying Agent is the
Trustee, the Company will promptly notify the Trustee of its action or failure
so to act.
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The Company will cause each Paying Agent other than the Trustee to execute
and deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will
(1) hold all sums held by it for the payment of principal of or
interest on Debentures in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided;
(2) give the Trustee notice of any default by the Company, or
any other obligor upon the Debentures, in the making of any such payment of
principal or interest; and
(3) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee all
sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of or interest on any
Debenture and remaining unclaimed for five years after such principal or
interest has become due and payable shall be paid to the Company on Company
Request, or, if then held by the Company, shall be discharged from such trust;
and the Holder of such Debenture shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money, and all
liability of the Company as trustee thereof, shall thereupon cease.
Section 8.04. Payment of Taxes and Other Claims. The Company will cause
its Subsidiaries to pay or discharge or cause to be paid or discharged, before
the same shall become delinquent, (1) all taxes, assessments and governmental
charges levied or imposed upon the Company or its Subsidiaries, or upon the
income, profits or property of the Company or its Subsidiaries, and (2) all
lawful claims for labor, materials and supplies which, if unpaid, might by law
become a lien upon the property of the Company or its Subsidiaries; provided,
however, that the Company or its Subsidiaries 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.
Section 8.05. Company Existence. Subject to Section 8.06, the Company
will do or cause to be done all things necessary to preserve and keep in full
force and effect its existence, its rights (charter and statutory) and its
franchises; provided, however, that the Company shall not be required to
preserve any right or franchise, except as specifically provided below, if the
Board of Directors of the Company shall determine that the preservation thereof
is no longer desirable in the conduct of the business of the Company and that
the net effect of the loss thereof is not disadvantageous in any material
respect to the Debentureholders.
Section 8.06. Company May Consolidate, etc., Only on Certain Terms. The
Company shall not consolidate or merge with or into any other entity, unless
(a) in the case of a consolidation or merger, if the
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Company is not the continuing entity, the successor entity formed by such
consolidation or into which the Company is merged shall have executed a
supplemental indenture pursuant to Section 7.01(2) specifically assuming the
obligations of the Company hereunder with respect to the Debentures, (b) in the
case of a sale of all or substantially all of the assets of the Company, the
purchaser shall have executed a supplemental indenture pursuant to Section
7.01(2) specifically assuming the obligations of the Company hereunder with
respect to the Debentures and (c) whether or not the Company is the continuing
entity,
(1) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time, or
both, would become an Event of Default, shall have happened and be
continuing; and
(2) immediately after giving effect to such transaction, the
continuing entity shall have a Consolidated Net Worth of not less than
the Consolidated Net Worth of the Company immediately preceding such
transaction; and
(3) the continuing entity has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel each stating that such
consolidation merger, conveyance or transfer complies with this Article
and that all conditions precedent herein provided for relating to such
transaction have been complied with.
Upon any consolidation or merger of the Company into another entity, or any
conveyance or transfer of all or substantially all of the properties and assets
of the Company in accordance with this Section, the successor entity formed by
such consolidation or into which the Company is merged or to which such
conveyance or transfer is made shall succeed to, and be substituted for, and
may exercise every right and power of, the Company under this Indenture with
the same effect as if such successor entity had been named as the Company
herein.
Section 8.07. Restrictions on Dividends, Redemptions, etc. So long as
the Common Equity, as reflected on the consolidated balance sheet of the Company
at the end of each fiscal year, is less than $2,000,000, or if an Event of
Default shall have occurred and be continuing, the Company will not (i) declare
or pay any dividend or make any distribution on its Equity Securities (other
than dividends or distributions payable in shares of Equity Securities of the
Company); (ii) purchase, redeem or otherwise acquire or retire for value any
shares of Equity Securities of the Company; or (iii) permit any Subsidiary to
purchase, redeem or otherwise acquire or retire for value any shares of Equity
Securities of the Company. Otherwise, the Company may declare and pay dividends
on, make distributions on, and purchase, redeem or otherwise acquire or retire
for value shares of its Equity Securities.
Section 8.08. Reports by the Company. The Company agrees to file with
the Trustee within 15 days after it is required to file the same with the
Securities and Exchange Commission, copies of the quarterly and annual reports
and of the information, documents and other reports (or copies of such portions
of any of the foregoing as said Commission may from time to time by rules and
regulations prescribe) which the Company may be required to file with said
Commission pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934, as amended. The Company also shall comply with the other
provisions of Section 314(a) of the TIA.
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ARTICLE NINE
Subordination of Debentures
Section 9.01. Agreement to Subordinate. The Company covenants and
agrees, and each Holder of Debentures by his or her acceptance thereof, likewise
covenants and agrees, that the Indebtedness represented by the Debentures and
the payment of the principal of and Interest on each and all of the Debentures
is hereby expressly subordinated, to the extent and in the manner hereinafter
set forth, in right of payment to the prior payment in full of all Senior
Indebtedness as provided in this Article Nine.
Section 9.02. Distribution on Dissolution, Liquidation and
Reorganization. Upon any distribution of assets of the Company upon any
dissolution, winding-up, liquidation or reorganization of the Company
(pursuant to or following bankruptcy, insolvency, reorganization or receivership
proceedings or other similar proceedings relative to the Company or its
property), or upon an assignment for the benefit of creditors or any other
marshaling of the assets and liabilities of the Company, (a) the holders of all
Senior Indebtedness shall first be entitled to receive payment in full of the
principal thereof and interest due thereon, or adequate provision shall be made
for such payment, before the Holders of the Debentures are entitled to receive
any payment on account of the principal of or interest on indebtedness evidenced
by the Debentures; and (b) any payment by, or distribution of assets of, the
Company of any kind or character, whether in cash, property or securities, to
which the Holders of the Debentures or the Trustee would be entitled shall be
paid or delivered by the person making such payment or distribution, whether a
trustee in bankruptcy, a receiver or liquidating trustee or otherwise, directly
to the holders of Senior Indebtedness or their representative or representatives
or to the trustee or trustees under any indenture under which any instruments
evidencing any of such Senior Indebtedness may have been issued, ratably
according to the aggregate amounts remaining unpaid on account of the Senior
Indebtedness held or represented by each, to the extent necessary to make
payment in full of all Senior Indebtedness remaining unpaid after giving effect
to any concurrent payment or distribution to the holders of such Senior
Indebtedness or provision therefor. The Company shall give prompt written
notice to the Trustee of any dissolution, winding up, liquidation or
reorganization or other similar event or proceeding relative to the Company or
its properties.
Section 9.03. Payments on Debentures Prohibited During Event of Default
under Senior Indebtedness. In the event and during the continuation of any
default in the payment of principal of, or premium, if any, or interest on, any
Senior Indebtedness beyond any applicable period of grace, or in the event that
any event of default with respect to any Senior Indebtedness shall have occurred
and be continuing, or would occur as a result of the payment referred to
hereinafter, permitting the holders of such Senior Indebtedness (or a trustee or
other representative thereof) to accelerate the maturity thereof, then, unless
and until such default or event of default shall have been cured or waived or
shall have ceased to exist, no payment of principal or interest on the
Debentures shall be made by the Company. In the event that any such payment,
whether in cash, property or securities, shall be received by the Trustee or the
Holders of the Debentures before all Senior Indebtedness is paid in full,
contrary to the provisions of Section 9.02 or this Section 9.03, such payment or
distribution shall be paid over to the holders of such Senior Indebtedness or
their representative or representatives or to the trustee or trustees under any
indenture under which any instruments evidencing any of such Senior Indebtedness
may have been issued, ratably as aforesaid, for application to the payment of
all Senior Indebtedness remaining unpaid until all such Senior Indebtedness
shall have been paid in full, after giving effect to any concurrent payment or
distribution to the holders of such Senior Indebtedness or provision therefor.
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Section 9.04. Subrogation. Subject to the payment in full of all Senior
Indebtedness, the Holders of the Debentures shall be subrogated to the rights of
the holders of Senior Indebtedness to receive payments or distributions of cash,
property or securities of the Company applicable to the Senior Indebtedness
until all amounts owing on the Debentures shall be paid in full, and, as between
the Company, its creditors other than holders of Senior Indebtedness, and the
Holders of the Debentures, no such payment or distribution made to the holders
of Senior Indebtedness by virtue of this Article Nine which otherwise would have
been made to the Holders of the Debentures shall be deemed to be a payment by
the Company on account of the Senior Indebtedness, it being understood that the
provisions of this Article Nine are and are intended solely for the purpose of
defining the relative rights of the Holders of the Debentures, on the one hand,
and the holders of Senior Indebtedness, on the other hand.
Section 9.05. Obligation of Company unconditional. Nothing contained in
this Article Nine or elsewhere in this Indenture or in the Debentures is
intended to or shall impair, as between the Company, its creditors other than
the holders of Senior Indebtedness, and the Holders of the Debentures, the
obligation of the Company, which is absolute and unconditional, to pay to the
Holders of the Debentures the principal of and interest on the Debentures as and
when the same shall become due and payable in accordance with their terms, or
affect the relative rights of the Holders of the Debentures and creditors of the
Company other than the holders of Senior Indebtedness, nor shall anything herein
or therein prevent the Trustee or the Holder of any Debenture from exercising
all remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article Nine of the holders
of Senior Indebtedness in respect of cash, property or securities of the Company
received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article Nine, the Trustee and the Holders of the Debentures shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction in which any such dissolution, winding-up, liquidation or
reorganization proceeding affecting the affairs of the Company is pending or
upon a certificate of the liquidating trustee or agent or other person making
any payment or distribution to the Trustee or to the Holders of the Debentures
for the purpose of ascertaining the persons entitled to participate in such
payment or distribution, the holders of the Senior Indebtedness and other
indebtedness of the Company, the amount thereof or payable thereon, the amount
paid or distributed therein and all other facts pertinent thereto or to this
Article Nine. In the event that the Trustee determines, in good faith, that
evidence is required with respect to the right of any person as holder of
Senior Indebtedness to participate in any payment or distribution pursuant to
this Article Nine, the Trustee may request such person to furnish evidence to
the reasonable satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such person, the extent to which such person is entitled
to participate in such payment or distribution and any other facts pertaining
to the rights of such person under this Article Nine, and if such evidence is
not furnished, the Trustee may defer any payment to such person pending
judicial determination as to the right of such person to receive such payment.
Section 9.06. Payments on Debentures Permitted. Nothing contained in
this Article Nine or elsewhere in this Indenture, or in any of the Debentures,
shall affect the obligation of the Company to make, or prevent the Company from
making, at any time except as provided in Sections 9.02 and 9.03, payments at
any time of principal of or interest on the Debentures.
Section 9.07. Effectuation of Subordination by Trustee. Each Holder of
Debentures, by his or her acceptance thereof, authorizes and directs the Trustee
in such Holder's behalf to take such action as may be
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necessary or appropriate to effectuate the subordination provided in this
Article Nine and appoints the Trustee such Holder's attorney-in-fact for any and
all such purposes.
Section 9.08. Knowledge of Trustee. Notwithstanding the provisions of
this Article Nine or any other provisions of this Indenture, but subject to
Section 6.01, the Trustee shall not be charged with knowledge of the existence
of any facts which would prohibit the making of any payment of moneys to or by
the Trustee, or the taking of any other action by the Trustee, unless and until
the Trustee shall have received written notice thereof from the Company, any
Debentureholder, any paying agent or the holder or representative of any class
of Senior Indebtedness.
Section 9.09. Trustee May Hold Senior Indebtedness. The Trustee shall
be entitled to all the rights set forth in this Article Nine with respect to
any Senior Indebtedness at the time held by it, to the same extent as any other
holder of Senior Indebtedness, and nothing in Section 6.12 or elsewhere in this
Indenture shall deprive the Trustee of any of its rights as such holder.
Section 9.10. Rights of Holders of Senior Indebtedness Not Impaired. No
right of any present or future holder of any Senior Indebtedness to enforce the
subordination herein shall at any time or in any way be prejudiced or impaired
by any act or failure to act on the part of the Company or by any noncompliance
by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.
Section 9.11. Rights and Obligations Subject to Power of Court. The
right of the holders of Senior Indebtedness and the obligations of the Trustee
and the Debentureholders set forth in this Article Nine are subject to the power
of a court of competent jurisdiction to make other equitable provision
reflecting the rights conferred in this Indenture upon the Senior Indebtedness
and the holders thereof with respect to the Debentures and the Holders thereof
by a plan of reorganization under applicable bankruptcy law.
Section 9.12. No Fiduciary Duties to Holders of Senior Indebtedness. The
Trustee shall not be deemed to owe any fiduciary duty to any present or future
holders of Senior Indebtedness, and with respect to such holders of Senior
Indebtedness, the Trustee undertakes to perform or to observe only such of the
covenants and obligations as are specifically set forth in this Article Nine,
and no implied covenants or obligations with respect to the holders of Senior
Indebtedness shall be implied in this Indenture against the Trustee. The
Trustee shall not be liable to any present or future holders of Senior
Indebtedness if the Trustee shall in good faith pay over or distribute to or on
behalf of Holders of Debentures or the Company money or assets to which any
holders of Senior Indebtedness shall be entitled by virtue of this Article
Nine.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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41
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective seals to be hereunto affixed and attested,
all as of the day and year first above written.
Attest: MCA FINANCIAL CORP.
_____________________________ By: ___________________________
Its: ___________________________
Attest: FIRST UNION NATIONAL BANK
_____________________________ By: ____________________________
Its: ____________________________
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42
EXHIBIT A
[FRONT OF DEBENTURE]
MCA FINANCIAL CORP.
__% SUBORDINATED DEBENTURE, SERIES 1997
DUE JUNE 1, 2003
No. ________ $________________________
CUSIP __________
MCA Financial Corp., a Michigan corporation (herein called the "Company"),
for value received, hereby promises to pay to ___________ or registered
assigns, the principal sum of _____________ Dollars on June 1, 2003, and to
pay interest thereon at the rate of __% per annum, quarterly, on March 1, June
1, September 1 and December 1 of each year, commencing September 1, 1997 (each
an "Interest Payment Date"), from the Date of Issue or from the most recent
Interest Payment Date to which interest has been paid or duly provided, until
the principal hereof is paid or made available for payment.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture hereinafter referred
to, be paid to the Person in whose name this Debenture (or one or more
Predecessor Debentures) is registered at the close of business on the Regular
Record Date for such interest, which shall be the close of business on the
first day of the calendar month preceding the month in which falls an Interest
Payment Date. Any such interest not so punctually paid or duly provided for
shall forthwith cease to be payable to the Registered Holder on such Regular
Record Date, and may be paid to the Person in whose name this Debenture (or one
or more Predecessor Debentures) is registered at the close of business on a
Special Record Date for the payment of such defaulted interest to be fixed by
the Trustee, notice whereof shall be given to the Holders not less than ten
days prior to such Special Record Date, or may be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Debentures may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in said Indenture. Payment of
interest on this Debenture will be made by check mailed to the address of the
person entitled thereto as such address shall appear on the Debenture Register.
Payment of the principal of this Debenture will be made at the office or
agency of the Trustee maintained for that purpose in Charlotte, North Carolina,
or in such other office or agency as may be established by the Company pursuant
to said Indenture in such coin or currency of the United States of America as
at the time of payment is legal tender for payment of public and private debts.
Reference is hereby made to the further provisions of this Debenture set
forth on the reverse side hereof and such further provisions shall for all
purposes have the same effect as though fully set forth at this place.
This Debenture shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been manually signed
by the Trustee under the Indenture.
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IN WITNESS WHEREOF, the Company has caused this Debenture to be signed in
its name by the manual or facsimile signature of its President or one of its
Executive Vice Presidents, Senior Vice Presidents or Vice Presidents and its
corporate seal, or a facsimile thereof, to be impressed or imprinted hereon,
attested by the manual or facsimile signature of its Secretary or one of its
Assistant Secretaries.
MCA FINANCIAL CORP.
By:___________________________
Its:__________________________
[Corporate Seal]
ATTEST:
By:____________________________
Its:___________________________
This is one of the Debentures referred to in the within mentioned Indenture.
DATED:
FIRST UNION NATIONAL BANK, as Trustee
By: ___________________________________
Authorized Signature
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[REVERSE OF DEBENTURE]
MCA FINANCIAL CORP.
__% SUBORDINATED DEBENTURE, SERIES 1997
DUE JUNE 1, 2003
This Debenture is one of a duly authorized issue of Debentures of the
Company designated as its __% Subordinated Debentures Due June 1, 2003 (herein
called the "Debentures"), limited in aggregate principal amount to $20,000,000
issued and to be issued under an Indenture dated as of June __, 1997 (herein
called the "Indenture"), between the Company and First Union National Bank, as
Trustee (herein called the "Trustee," which term includes any successor Trustee
under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights
thereunder of the Company, the Trustee and the Holders of the Debentures, and
the terms upon which the Debentures are, and are to be, authenticated and
delivered.
The indebtedness of the Company evidenced by the Debentures, including the
principal thereof and interest thereon (including post-default interest) is, to
the extent and in the manner set forth in the Indenture subordinate and junior
in right of payment at all times, including upon liquidation of the Company, to
the Company's obligations to holders of Senior Indebtedness and in certain
events, the Trustee's fees. Each Holder of a Debenture, by acceptance hereof,
agrees to and shall be bound by such provisions of the Indenture and all other
provisions of the Indenture, authorizes and directs the Trustee to take such
action on his behalf as may be necessary or appropriate to acknowledge or
effectuate, as between the Debentureholders and the holders of the Senior
Indebtedness, the subordination of this Debenture as provided in the Indenture
and appoints the Trustee his attorney-in-fact for any and all such purposes.
Each Holder of this Debenture, by accepting the same, agrees that each holder
of Senior Indebtedness, whether created or acquired before or after the
issuance of the Debentures, shall be deemed conclusively to have relied on such
provisions in acquiring and continuing to hold such Senior Indebtedness.
Except as provided hereafter in this paragraph, the Debentures are not
subject to redemption at any time prior to their Stated Maturity. The Company
may redeem all the Debentures at any time on or after July 1, 1999, or some of
them from time to time on or after June 1, 1999, at the following redemption
prices (expressed in percentages of principal amount), if redeemed during the
periods indicated below, plus accrued interest to the redemption date:
Year Percentage
July 1, 1999 through May 31, 2000 .............. 102.0%
June 1, 2000 through May 31, 2001............... 101.0%
June 1, 2001 and thereafter..................... 100.0%
In addition to the foregoing optional redemption, on each March 1,
commencing with March 1, 1999, upon request the Company will redeem the
principal amount of this Debenture (but only up to $25,000 in any calendar
year, and not more than $100,000 in the aggregate for all Holders in any
calendar year, together with interest accrued to the March 1 Mandatory
Redemption Date), provided that a duly made request therefor from a Holder or a
deceased Holder's authorized representative has been received by the Company or
the Trustee on or before the December 1 preceding such March 1 Mandatory
Redemption Date, in
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accordance with the provisions of the Indenture, and further provided that (1)
this Debenture has been registered in the Holder's name since the Date of Issue
or for a period of at least six months prior to the date of the request for
redemption, (2) the Trustee has been notified in writing of the request for
redemption within one year after a Holder's death, and (3) the Company is not,
or, after giving effect to such redemption would not be, in default under any
Senior Indebtedness. On March 1 of each calendar year succeeding an initial
redemption, the Company will redeem additional Debentures originally held by a
Debentureholder in the principal amount of up to $25,000 (together with interest
accrued to the March 1 Mandatory Redemption Date) if the Debentureholder or the
authorized representative of a deceased Debentureholder duly requests such
redemption on or before the December 1 preceding such March 1 Mandatory
Redemption Date. When honoring requests for redemption, the Company shall give
priority to requests made on behalf of deceased Debentureholders.
If an Event of Default as defined in the Indenture shall occur and be
continuing, the principal of all the Debentures may be declared due and payable
in the manner and with the effect provided in the Indenture. The Indenture
provides that such declaration and its consequences may, in certain events, be
annulled by the Holders of a majority in principal amount of the Debentures
Outstanding.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Debentures under the Indenture at
any time by the Company and the Trustee with the consent of the Holders of not
less than 50% in aggregate principal amount of the Debentures at the time
Outstanding, as defined in the Indenture. The Indenture also contains
provisions permitting the Holders of a majority in aggregate principal amount
of the Debentures at the time Outstanding on behalf of the Holders of all the
Debentures, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of this Debenture shall be conclusive
and binding upon such Holder and upon all future Holders of this Debenture and
of any Debenture issued upon the registration of transfer hereof or in exchange
therefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Debenture.
Subject to the last paragraph hereof, no reference herein to the Indenture
and no provisions of this Debenture or of the Indenture shall alter or impair
the obligation of the Company, which is absolute and unconditional, to pay the
principal of and interest on this Debenture at the times, places and rate, and
in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, this Debenture is transferable on the Debenture Register of the
Trustee, upon surrender of this Debenture for registration of transfer at the
office or agency of the Trustee to be maintained for that purpose in Charlotte,
North Carolina, or at such other office or agency as may be established by the
Company for such purpose pursuant to the Indenture duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Debenture Registrar, duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Debentures,
of authorized denominations and for the same aggregate principal amount, will
be issued to the designated transferee or transferees.
The Debentures are issuable only in registered form, without coupons, in
denominations of $1,000 and integral multiples thereof. Debentures are
exchangeable for a like aggregate principal amount of Debentures of a different
authorized denomination, as requested by the Holder surrendering the same.
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No service charge shall be made for any such transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.
No recourse shall be had for the payment of the principal of or interest
on this Debenture, or for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Indenture or any indenture supplement
thereto, against any incorporator, stockholder, officer or director, as such,
past, present, or future, of the Company or of any successor at law or by the
enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released; provided, however, that nothing herein
or in the Indenture shall be taken to prevent recourse to and the enforcement
of the liability, if any, of any stockholder or subscriber to capital stock
upon or in respect of shares of capital stock of the Company not fully paid up.
Certain capitalized terms used in this Debenture which are defined in the
Indenture have the meanings set forth therein.
The Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name this Debenture is registered as the owner hereof
for all purposes, whether or not this Debenture be overdue, and neither the
Company, the Trustee, nor any such agent shall be affected by notice to the
contrary.
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[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
_______________________________________________________________________________
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
________
| |
____________________________
____________________________
(Name and Address of Assignee Including Zip
Code Must be Printed or Typewritten)
____________________________
the within instrument, and all rights thereunder, hereby irrevocably
constituting and appointing
_________________________________
ATTORNEY TO TRANSFER SAID instrument on the books of the Company, with full
power of substitution in the premises.
Dated:____________________ _________________________________________
Signature
Signature Guaranteed:
_________________________________________
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Instrument in every particular
NOTE: ANY TRANSFER OR ASSIGNMENT IS SUBJECT TO THE PRESENTATION OF SUCH PROOF
OF VALID AND LEGAL TRANSFER OR ASSIGNMENT AS THE COMPANY MAY REQUIRE.
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Reconciliation and Tie Sheet*
between
Provisions of the Trust Indenture Act of 1939
and
Indenture, Dated as of June __, 1997
between
MCA FINANCIAL CORP.
and
FIRST UNION NATIONAL BANK, as Trustee
Section Section of
of TIA Indenture
------- ----------
310(a)(1) .............................. 6.08
(a)(2) .............................. 6.08
(a)(3) .............................. Inapplicable
(a)(4) .............................. Inapplicable
(b) .............................. 6.08, 6.09
(c) .............................. Inapplicable
311(a) .............................. 6.12
(b) .............................. 6.12
(c) .............................. Inapplicable
312(a) .............................. 6.14
(b) .............................. 1.08
(c) .............................. 1.08
313(a) .............................. 6.13
(b)(1) .............................. 6.13
(b)(2) .............................. 6.13
(c) .............................. 6.13
(d) .............................. 6.13
314(a) .............................. 8.10
(b) .............................. 8.02
(c) .............................. 1.02
(d) .............................. 8.11
(e) .............................. 1.02
(f) .............................. Omitted
315(a) .............................. 6.01(a)
(b) .............................. 6.02
(c) .............................. 6.01(b)
(d) .............................. 6.01(c)
(e) .............................. 5.13
316(a)(1) .............................. 5.12
(a)(2) .............................. Omitted
(b) .............................. 5.08
(c) .............................. 1.07
317(a) .............................. 5.03, 5.04
(b) .............................. 8.05
318(a) .............................. 1.11
* This Reconciliation and Tie Sheet is not a part of the Indenture
