EXHIBIT 4.1
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PROGRESS FINANCIAL CORPORATION
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INDENTURE
Dated as of June 3, 1997
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THE BANK OF NEW YORK
as Trustee
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JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
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TIE-SHEET
of provisions of Trust Indenture Act of 1939 with Indenture dated as of
June 3, 1997 between Progress Financial Corporation and The Bank of New York,
Trustee:
ACT SECTION INDENTURE SECTION
310(a)(1)...................................................................6.09
310(a)(2) ..................................................................6.09
310(a)(3)....................................................................N/A
310(a)(4)....................................................................N/A
310(a)(5).............................................................6.10, 6.11
310(b).......................................................................N/A
310(c)......................................................................6.13
311(a) and (b)...............................................................N/A
311(c).............................................................4.01, 4.02(a)
312(a)......................................................................4.02
312(b) and (c)..............................................................4.04
313(a)......................................................................4.04
313(b)(1)...................................................................4.04
313(b)(2)...................................................................4.04
313(c)......................................................................4.04
313(d)......................................................................4.04
314(a)......................................................................4.03
314(b).......................................................................N/A
314(c)(1) and (2)...........................................................6.07
314(c)(3)....................................................................N/A
314(d) ......................................................................N/A
314(e)......................................................................6.07
314(f) ......................................................................N/A
315(a)(c) and (d)...........................................................6.01
315(b) .....................................................................5.08
315(e) .....................................................................5.09
316(a)(1) ..................................................................5.07
316(a)(2) ...................................................................N/A
316(a) last sentence .......................................................2.09
316(b) .....................................................................9.02
317(a) .....................................................................5.05
317(b) .....................................................................6.05
318(a) ....................................................................13.08
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THIS TIE-SHEET IS NOT PART OF THE INDENTURE AS EXECUTED.
TABLE OF CONTENTS*
Page
ARTICLE I
DEFINITIONS............................... 1
SECTION 1.01. Definitions.............................................. 1
Additional Sums......................................................... 1
Adjusted Treasury Rate.................................................. 1
Affiliate............................................................... 2
Authenticating Agent.................................................... 2
Bankruptcy Law.......................................................... 2
Board of Directors...................................................... 2
Board Resolution........................................................ 2
Business Day............................................................ 2
Capital Securities...................................................... 2
Capital Securities Guarantee............................................ 2
Commission.............................................................. 2
Common Securities....................................................... 3
Common Securities Guarantee............................................. 3
Common Stock............................................................ 3
Company................................................................. 3
Company Request......................................................... 3
Comparable Treasury Issue............................................... 3
Comparable Treasury Price............................................... 3
Compounded Interest..................................................... 4
Custodian............................................................... 4
Declaration............................................................. 4
Default................................................................. 4
Defaulted Interest....................................................... 4
Deferred Interest....................................................... 4
Definitive Securities................................................... 4
Depositary.............................................................. 4
Dissolution Event....................................................... 4
Event of Default........................................................ 4
Exchange Act............................................................ 4
Exchange Offer.......................................................... 5
Extended Interest Payment Period........................................ 5
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* THIS TABLE OF CONTENTS SHALL NOT, FOR ANY PURPOSE, BE DEEMED TO BE A
PART OF THE INDENTURE.
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Page
Federal Reserve......................................................... 5
Global Security......................................................... 5
Indebtedness............................................................. 5
Indebtedness Ranking on a Parity with the Securities.................... 5
Indebtedness Ranking Junior to the Securities........................... 6
Indenture............................................................... 6
Initial Optional Redemption Date........................................ 6
Interest Payment Date................................................... 6
Liquidated Damages...................................................... 6
Make Whole Amount....................................................... 6
Maturity Date........................................................... 6
Progress Capital Trust.................................................. 6
Mortgage................................................................ 6
Non Book-Entry Capital Securities....................................... 6
Officers................................................................ 7
Officers' Certificate................................................... 7
Opinion of Counsel...................................................... 7
Optional Redemption Price............................................... 7
Other Debentures........................................................ 7
Other Guarantees........................................................ 7
outstanding............................................................. 7
Person.................................................................. 8
Predecessor Security.................................................... 8
Principal Office of the Trustee......................................... 8
Purchase Agreement...................................................... 8
Property Trustee........................................................ 8
Quotation Agent......................................................... 8
Redemption Price........................................................ 8
Reference Treasury Dealer............................................... 8
Reference Treasury Dealer Quotations.................................... 8
Registration Rights Agreement........................................... 8
Regulatory Capital Event..................................................8
Responsible Officer..................................................... 9
Restricted Security..................................................... 9
Rule 144A............................................................... 9
Securities.............................................................. 9
Securities Act.......................................................... 9
Securityholder.......................................................... 9
holder of Securities.................................................... 9
Security Register....................................................... 9
Senior Indebtedness..................................................... 9
Series A Securities..................................................... 9
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Series B Securities.................................................... 10
Special Event.......................................................... 10
Special Event Redemption Price......................................... 10
Subsidiary.............................................................. 10
Tax Event............................................................... 10
Treasury Rate........................................................... 10
Trustee................................................................. 11
Trust Indenture Act of 1939..............................................11
Trust Securities........................................................ 11
U.S. Government Obligations............................................. 11
ARTICLE II
SECURITIES..................................... 12
SECTION 2.01. Forms Generally.......................................... 12
SECTION 2.02. Execution and Authentication............................. 12
SECTION 2.03. Form and Payment......................................... 12
SECTION 2.04. Legends.................................................. 13
SECTION 2.05. Global Security.......................................... 13
SECTION 2.06 Interest................................................. 15
SECTION 2.07. Transfer and Exchange.................................... 15
SECTION 2.08. Replacement Securities................................... 17
SECTION 2.09. Temporary Securities..................................... 18
SECTION 2.10. Cancellation............................................. 18
SECTION 2.11. Defaulted Interest....................................... 19
SECTION 2.12. CUSIP Numbers............................................ 20
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY.......................... 20
SECTION 3.01. Payment of Principal, Premium and Interest............... 20
SECTION 3.02. Offices for Notices and Payments, etc.................... 20
SECTION 3.03. Appointments to Fill Vacancies in Trustee's Office....... 21
SECTION 3.04. Provision as to Paying Agent............................. 21
SECTION 3.05. Certificate to Trustee................................... 22
SECTION 3.06. Compliance with Consolidation Provisions................. 22
SECTION 3.07. Limitation on Dividends.................................. 22
SECTION 3.08. Covenants as to Progress Capital Trust................... 23
SECTION 3.09. Payment of Expenses...................................... 23
SECTION 3.10. Payment Upon Resignation or Removal...................... 24
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Page
ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE.................................. 25
SECTION 4.01. Securityholders' Lists................................... 25
SECTION 4.02. Preservation and Disclosure of Lists..................... 25
SECTION 4.03. Reports by Company....................................... 27
SECTION 4.04. Reports by the Trustee................................... 28
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT...................................... 28
SECTION 5.01. Events of Default........................................ 28
SECTION 5.02. Payment of Securities on Default; Suit Therefor.......... 30
SECTION 5.03. Application of Moneys Collected by Trustee............... 32
SECTION 5.04. Proceedings by Securityholders........................... 33
SECTION 5.05. Proceedings by Trustee................................... 34
SECTION 5.06. Remedies Cumulative and Continuing....................... 34
SECTION 5.07. Direction of Proceedings and Waiver of Defaults by Majority
of Securityholders....................................... 34
SECTION 5.08. Notice of Defaults....................................... 35
SECTION 5.09. Undertaking to Pay Costs................................. 35
ARTICLE VI
CONCERNING THE TRUSTEE................................... 36
SECTION 6.01. Duties and Responsibilities of Trustee................... 36
SECTION 6.02. Reliance on Documents, Opinions, etc..................... 37
SECTION 6.03. No Responsibility for Recitals, etc...................... 39
SECTION 6.04. Trustee, Authenticating Agent, Paying Agents, Transfer
Agents or Registrar May Own Securities................... 39
SECTION 6.05. Moneys to be Held in Trust............................... 40
SECTION 6.06. Compensation and Expenses of Trustee..................... 40
SECTION 6.07. Officers' Certificate as Evidence........................ 41
SECTION 6.08. Conflicting Interest of Trustee.......................... 41
SECTION 6.09. Eligibility of Trustee................................... 41
SECTION 6.10. Resignation or Removal of Trustee........................ 41
SECTION 6.11. Acceptance by Successor Trustee.......................... 43
SECTION 6.12. Succession by Merger, etc................................ 44
SECTION 6.13. Limitation on Rights of Trustee as a Creditor............ 44
SECTION 6.14. Authenticating Agents.................................... 44
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Page
ARTICLE VII
CONCERNING THE SECURITYHOLDERS.............................. 46
SECTION 7.01. Action by Securityholders................................ 46
SECTION 7.02. Proof of Execution by Securityholders.................... 46
SECTION 7.03. Who Are Deemed Absolute Owners........................... 47
SECTION 7.04. Securities Owned by Company Deemed Not Outstanding....... 47
SECTION 7.05. Revocation of Consents; Future Holders Bound............. 47
ARTICLE VIII
SECURITYHOLDERS' MEETINGS.................................. 48
SECTION 8.01. Purposes of Meetings..................................... 48
SECTION 8.02. Call of Meetings by Trustee.............................. 48
SECTION 8.03. Call of Meetings by Company or Securityholders........... 49
SECTION 8.04. Qualifications for Voting................................ 49
SECTION 8.05. Regulations.............................................. 49
SECTION 8.06. Voting................................................... 50
ARTICLE IX
AMENDMENTS............................................. 50
SECTION 9.01. Without Consent of Securityholders....................... 50
SECTION 9.02. With Consent of Securityholders.......................... 52
SECTION 9.03. Compliance with Trust Indenture Act; Effect of Supplemental
Indentures............................................... 53
SECTION 9.04. Notation on Securities................................... 53
SECTION 9.05. Evidence of Compliance of Supplemental Indenture to be
Furnished Trustee........................................ 54
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE................ 54
SECTION 10.01. Company May Consolidate, etc., on Certain Terms.......... 54
SECTION 10.02. Successor Corporation to be Substituted for Company...... 55
SECTION 10.03. Opinion of Counsel to be Given Trustee................... 55
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE........................ 55
SECTION 11.01. Discharge of Indenture................................... 55
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Page
SECTION 11.02. Deposited Moneys and U.S. Government Obligations to
be Held in Trust by Trustee.............................. 56
SECTION 11.03. Paying Agent to Repay Moneys Held........................ 57
SECTION 11.04. Return of Unclaimed Moneys............................... 57
SECTION 11.05. Defeasance Upon Deposit of Moneys or U.S. Government
Obligations.............................................. 57
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS......................... 59
SECTION 12.01. Indenture and Securities Solely Corporate Obligations.... 59
ARTICLE XIII
MISCELLANEOUS PROVISIONS................................. 59
SECTION 13.01. Successors............................................... 59
SECTION 13.02. Official Acts by Successor Corporation................... 59
SECTION 13.03. Surrender of Company Powers.............................. 60
SECTION 13.04. Addresses for Notices, etc............................... 60
SECTION 13.05. Governing Law............................................ 60
SECTION 13.06. Evidence of Compliance with Conditions Precedent......... 60
SECTION 13.07. Business Days............................................ 61
SECTION 13.08. Trust Indenture Act to Control........................... 61
SECTION 13.09. Table of Contents, Headings, etc......................... 61
SECTION 13.10. Execution in Counterparts................................ 61
SECTION 13.11. Separability............................................. 61
SECTION 13.12. Assignment............................................... 62
SECTION 13.13. Acknowledgement of Rights................................ 62
ARTICLE XIV
REDEMPTION OF SECURITIES -- MANDATORY AND
OPTIONAL SINKING FUND.................................. 62
SECTION 14.01. Special Event Redemption................................. 62
SECTION 14.02. Optional Redemption by Company........................... 63
SECTION 14.03. No Sinking Fund.......................................... 64
SECTION 14.04. Notice of Redemption; Selection of Securities............ 64
SECTION 14.05. Payment of Securities Called for Redemption.............. 65
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Page
ARTICLE XV
SUBORDINATION OF SECURITIES................................ 66
SECTION 15.01. Agreement to Subordinate................................. 66
SECTION 15.02. Default on Senior Indebtedness........................... 66
SECTION 15.03. Liquidation; Dissolution; Bankruptcy..................... 67
SECTION 15.04. Subrogation.............................................. 68
SECTION 15.05. Trustee to Effectuate Subordination...................... 69
SECTION 15.06. Notice by the Company.................................... 69
SECTION 15.07. Rights of the Trustee; Holders of Senior Indebtedness.... 70
SECTION 15.08. Subordination May Not Be Impaired........................ 71
ARTICLE XVI
EXTENSION OF INTEREST PAYMENT PERIOD.................. 72
SECTION 16.01. Extension of Interest Payment Period..................... 72
SECTION 16.02. Notice of Extension...................................... 72
EXHIBIT A....................................................................A-1
Testimonium
Signatures
Acknowledgements
vii
THIS INDENTURE, dated as of June 3, 1997, between Progress Financial
Corporation, a Delaware corporation (hereinafter sometimes called the
"Company"), and The Bank of New York, a New York banking corporation, as
trustee (hereinafter sometimes called the "Trustee"),
W I T N E S E T H :
In consideration of the premises, and the purchase of the Securities
by the holders thereof, the Company covenants and agrees with the Trustee for
the equal and proportionate benefit of the respective holders from time to
time of the Securities, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions.
The terms defined in this Section 1.01 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes
of this Indenture shall have the respective meanings specified in this
Section 1.01. All other terms used in this Indenture which are defined in
the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), or
which are by reference therein defined in the Securities Act, shall (except
as herein otherwise expressly provided or unless the context otherwise
requires) have the meanings assigned to such terms in said Trust Indenture
Act and in said Securities Act as in force at the date of this Indenture as
originally executed. The following terms have the meanings given to them in
the Declaration: (i) Clearing Agency; (ii) Delaware Trustee; (iii) Property
Trustee; (iv) Administrative Trustees; (v) Series A Capital Securities; (vi)
Series B Capital Securities; (vii) Direct Action; and (viii) Distributions.
All accounting terms used herein and not expressly defined shall have the
meanings assigned to such terms in accordance with generally accepted
accounting principles and the term "generally accepted accounting principles"
means such accounting principles as are generally accepted at the time of any
computation. 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. Headings are used for convenience of
reference only and do not affect interpretation. The singular includes the
plural and vice versa.
"Additional Sums" shall have the meaning set forth in Section
2.06(c).
"Adjusted Treasury Rate" means, with respect to any redemption date
pursuant to Section 14.01, the rate per annum equal to the semi-annual
equivalent yield to maturity of the Comparable Treasury Issue, assuming a
price for the Comparable Treasury Issue (expressed as a percentage of its
principal amount) equal to the Comparable Treasury Price
for such redemption date plus (i) 3.49% if such redemption date occurs on or
prior to June 1, 1998 and (ii) 2.95% in all other cases.
"Affiliate" shall have the meaning given to that term in Rule 405
under the Securities Act or any successor rule thereunder.
"Authenticating Agent" shall mean any agent or agents of the Trustee
which at the time shall be appointed and acting pursuant to Section 6.14.
"Bankruptcy Law" shall mean Title 11, U.S. Code, or any similar
federal or state law for the relief of debtors.
"Board of Directors" shall mean either the Board of Directors of the
Company or any duly authorized committee of that board.
"Board Resolution" shall mean 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" shall mean, with respect to any series of Securities,
any day other than a Saturday or a Sunday or a day on which banking
institutions in The City of New York or Blue Xxxx, Pennsylvania are
authorized or required by law or executive order to close.
"Capital Securities" shall mean undivided beneficial interests in
the assets of Progress Capital Trust which rank pari passu with the Common
Securities issued by Progress Capital Trust; provided, however, that if an
Event of Default has occurred and is continuing, no payments in respect of
Distributions on, or payments upon liquidation, redemption or otherwise with
respect to, the Common Securities shall be made until the holders of the
Capital Securities shall be paid in full the Distributions and the
liquidation, redemption and other payments to which they are entitled.
References to "Capital Securities" shall include collectively any Series A
Capital Securities and Series B Capital Securities.
"Capital Securities Guarantee" shall mean any guarantee that the
Company may enter into with The Bank of New York or other Persons that
operates directly or indirectly for the benefit of holders of Capital
Securities of Progress Capital Trust and shall include a Series A Capital
Securities Guarantee and a Series B Capital Securities Guarantee with respect
to the Series A Capital Securities and the Series B Capital Securities,
respectively.
"Commission" shall mean the Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or if at any
time after the execution of this Indenture such Commission is not existing
and performing the duties now
2
assigned to it under the Trust Indenture Act, then the body performing such
duties at such time.
"Common Securities" shall mean undivided beneficial interests in the
assets of Progress Capital Trust which rank pari passu with Capital
Securities issued by Progress Capital Trust; provided, however, that if an
Event of Default has occurred and is continuing, no payments in respect of
Distributions on, or payments upon liquidation, redemption or otherwise with
respect to, the Common Securities shall be made until the holders of the
Capital Securities shall be paid in full the Distributions and the
liquidation, redemption and other payments to which they are entitled.
"Common Securities Guarantee" shall mean any guarantee that the
Company may enter into with any Person or Persons that operates directly or
indirectly for the benefit of holders of Common Securities of Progress
Capital Trust.
"Common Stock" shall mean the Common Stock, par value $1.00 per
share, of the Company or any other class of stock resulting from changes or
reclassifications of such Common Stock consisting solely of changes in par
value, or from par value to no par value, or from no par value to par value.
"Company" shall mean Progress Financial Corporation, a Delaware
corporation, and, subject to the provisions of Article X, shall include its
successors and assigns.
"Company Request" or "Company Order" shall mean a written request or
order signed in the name of the Company by the Chairman, the Chief Executive
Officer, the President, a Vice Chairman, a Vice President, the Comptroller,
the Secretary or an Assistant Secretary of the Company, and delivered to the
Trustee.
"Comparable Treasury Issue" means the United States Treasury
security selected by the Quotation Agent as having a maturity comparable to
the remaining term to maturity of the Junior Subordinated Debentures (the
"Remaining Life") to be prepaid that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the Remaining.
If no United States Treasury security has a maturity which is within a period
from three months before to three months after the Remaining Life, the two
most closely corresponding United States Treasury securities as selected by
the Quotation Agent shall be used as the Comparable Treasury Issue, and the
Treasury Rate shall be interpolated or extrapolated on a straight-line basis,
rounding to the nearest month.
"Comparable Treasury Price" means, with respect to any redemption
date pursuant to Section 14.01, (i) the average of the bid and asked prices
for the Comparable
3
Treasury Issue (expressed in each case as a percentage of its principal
amount) on the third Business Day preceding such redemption date, as set
forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U.S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
Business Day, (A) the average of the Reference Treasury Dealer Quotations for
such redemption date, after excluding the highest and lowest such Reference
Treasury Dealer Quotations, or (B) if the Trustee obtains fewer than three
such Reference Treasury Dealer Quotations, the average of all such Quotations.
"Compounded Interest" shall have the meaning set forth in Section
16.01.
"Custodian" shall mean any receiver, trustee, assignee, liquidator,
or similar official under any Bankruptcy Law.
"Declaration" means the Amended and Restated Declaration of Trust of
Progress Capital Trust, dated as of June 3, 1997, as amended from time to
time.
"Default" means any event, act or condition that with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulted Interest" shall have the same meaning set forth in
Section 2.11.
"Deferred Interest" shall have the meaning set forth in Section
16.01.
"Definitive Securities" shall mean those securities issued in fully
registered certificated form not otherwise in global form.
"Depositary" shall mean, with respect to Securities, for which the
Company shall determine that such Securities will be issued as a Global
Security, The Depository Trust Company, New York, New York, another clearing
agency, or any successor registered as a clearing agency under the Exchange
Act or other applicable statute or regulation, which, in each case, shall be
designated by the Company pursuant to Section 2.05(d).
"Dissolution Event" means the liquidation of Progress Capital Trust
pursuant to the Declaration, and the distribution of the Securities held by
the Property Trustee to the holders of the Trust Securities issued by
Progress Capital Trust pro rata in accordance with the Declaration.
"Event of Default" shall mean any event specified in Section 5.01,
continued for the period of time, if any, and after the giving of the notice,
if any, therein designated.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
4
"Exchange Offer" means the offer that may be made pursuant to the
Registration Rights Agreement (i) by the Company to exchange Series B
Securities for Series A Securities and to exchange a Series B Capital
Securities Guarantee for a Series A Capital Securities Guarantee and (ii) by
Progress Capital Trust to exchange Series B Capital Securities for Series A
Capital Securities.
"Extended Interest Payment Period" shall have the meaning set forth
in Section 16.01.
"Federal Reserve" shall mean the Board of Governors of the Federal
Reserve System.
"Global Security" means, with respect to the Securities, a Security
executed by the Company and delivered by the Trustee to the Depositary or
pursuant to the Depositary's instruction, all in accordance with the
Indenture, which shall be registered in the name of the Depositary or its
nominee.
"Indebtedness" shall mean (i) every obligation of the Company for
money borrowed; (ii) every obligation of the Company evidenced by bonds,
debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets or
businesses; (iii) every reimbursement obligation of the Company with respect
to letters of credit, bankers' acceptances or similar facilities issued for
the account of the Company; (iv) every obligation of the Company issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course
of business); (v) every capital lease obligation of the Company; (vi) all
indebtedness of the Company whether incurred on or prior to the date of the
Indenture or thereafter incurred, for claims in respect of derivative
products, including interest rate, foreign exchange rate and commodity
forward contracts, options and swaps and similar arrangements; and (vii)
every obligation of the type referred to in clauses(i) through (vi) of
another Person and all dividends of another Person the payment of which, in
either case, the Company has guaranteed or is responsible or liable, directly
or indirectly, as obligor or otherwise.
"Indebtedness Ranking on a Parity with the Securities" shall mean
(i) Indebtedness, whether outstanding on the date of execution of this
Indenture or hereafter created, assumed or incurred, to the extent such
indebtedness specifically by its terms ranks equally with and not prior to
the Securities in the right of payment upon the happening of any dissolution
or winding up or liquidation or reorganization of the Company, and (ii) all
other debt securities, and guarantees in respect of those debt securities,
issued to any trust other than Progress Capital Trust, or a trustee of such
trust, partnership or other entity affiliated with the Company that is a
financing vehicle of the Company (a "financing entity") in connection with
the issuance by such financing entity of equity securities or other
securities guaranteed by the Company pursuant to an instrument that ranks
pari passu with or junior in right of payment to the Capital Securities
Guarantee. The securing of any
5
Indebtedness, otherwise constituting Indebtedness Ranking on a Parity with
the Securities, shall not be deemed to prevent such Indebtedness from
constituting Indebtedness Ranking on a Parity with the Securities.
"Indebtedness Ranking Junior to the Securities" shall mean any
Indebtedness, whether outstanding on the date of execution of this Indenture
or hereafter created, assumed or incurred, to the extent such indebtedness
specifically by its terms ranks junior to and not equally with or prior to
the Securities (and any other Indebtedness Ranking on a Parity with the
Securities) in right of payment upon the happening of any dissolution or
winding up or liquidation or reorganization of the Company. The securing of
any Indebtedness, otherwise constituting Indebtedness Ranking Junior to the
Securities, shall not be deemed to prevent such Indebtedness from
constituting Indebtedness Ranking Junior to the Securities.
"Indenture" shall mean this instrument as originally executed or, if
amended as herein provided, as so amended.
"Initial Optional Redemption Date" means June 1, 2007.
"Interest Payment Date" shall have the meaning set forth in Section
2.06(a).
"Liquidated Damages" shall have the meaning set forth in the
Registration Rights Agreement.
"Make Whole Amount" shall mean an amount equal to the greater of (i)
100% of the principal amount of the Securities to be redeemed or (ii) the
sum, as determined by a Quotation Agent, of the present values of remaining
scheduled payments of principal and interest on the Securities, discounted to
the prepayment date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Adjusted Treasury Rate, plus, in
the case of each of clauses (i) and (ii), accrued and unpaid interest
thereon, including Compounded Interest and Additional Sums, if any, to the
date of such redemption.
"Maturity Date" shall mean June 1, 2027.
"Progress Capital Trust" or the "Trust" shall mean Progress Capital
Trust I, a Delaware business trust created for the purpose of issuing its
undivided beneficial interests in connection with the issuance of Securities
under this Indenture.
"Mortgage" shall mean and include any mortgage, pledge, lien,
security interest, conditional sale or other title retention agreement or
other similar encumbrance.
"Non Book-Entry Capital Securities" shall have the meaning set forth
in Section 2.05(a)(ii).
6
"Officers" shall mean any of the Chairman, a Vice Chairman, the
Chief Executive Officer, the President, a Vice President, the Comptroller,
the Secretary or an Assistant Secretary of the Company.
"Officers' Certificate" shall mean a certificate signed by two
Officers and delivered to the Trustee.
"Opinion of Counsel" shall mean a written opinion of counsel, who
may be an employee of the Company, and who shall be acceptable to the Trustee.
"Optional Redemption Price" shall have the meaning set forth in
Section 14.02(a).
"Other Debentures" means all junior subordinated debentures issued
by the Company from time to time and sold to trusts to be established by the
Company (if any), in each case similar to the Trust.
"Other Guarantees" means all guarantees to be issued by the Company
with respect to capital securities (if any) and issued to other trusts to be
established by the Company (if any), in each case similar to the Trust.
The term "outstanding" when used with reference to Securities,
shall, subject to the provisions of Section 7.04, mean, as of any particular
time, all Securities authenticated and delivered by the Trustee or the
Authenticating Agent under this Indenture, except
(a) Securities theretofore cancelled by the Trustee or the
Authenticating Agent or delivered to the Trustee for
cancellation;
(b) Securities, or portions thereof, for the payment or redemption
of which moneys in the necessary amount shall have been
deposited in trust with the Trustee or with any paying agent
(other than the Company) or shall have been set aside and
segregated in trust by the Company (if the Company shall act as
its own paying agent); provided that, if such Securities, or
portions thereof, are to be redeemed prior to maturity thereof,
notice of such redemption shall have been given as in Article
XIV provided or provision satisfactory to the Trustee shall
have been made for giving such notice; and
(c) Securities in lieu of or in substitution for which other
Securities shall have been authenticated and delivered pursuant
to the terms of Section 2.08 unless proof satisfactory to the
Company and the Trustee is presented that any such Securities
are held by bona fide holders in due course.
7
"Person" shall mean any individual, corporation, estate,
partnership, joint venture, association, joint-stock company, limited
liability company, trust, unincorporated organization or government or any
agency or political subdivision thereof.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt and as that
evidenced by such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 2.08 in
lieu of a lost, destroyed or stolen Security shall be deemed to evidence the
same debt as the lost, destroyed or stolen Security.
"Principal Office of the Trustee", or other similar term, shall mean
the office of the Trustee, at which at any particular time its corporate
trust business shall be administered.
"Purchase Agreement" shall mean the Purchase Agreement dated May 30,
1997 among the Company, Progress Capital Trust and the Initial Purchaser
named therein.
"Property Trustee" shall have the same meaning as set forth in the
Declaration.
"Quotation Agent" means the Reference Treasury Dealer appointed by
the Company.
"Redemption Price" means the Special Event Redemption Price or the
Optional Redemption Price, as the context requires.
"Reference Treasury Dealer" means a nationally recognized U.S.
Government securities dealer in New York City selected by the Company.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any redemption date pursuant to Section 14.01,
the average, as determined by the Trustee, of the bid and asked prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the Trustee by such Reference Treasury
Dealer at 5:00 p.m. New York City time on the third Business Day preceding
such redemption date.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of June 3, 1997, by and among the Company, the Trust and
the Initial Purchaser named therein, as such agreement may be amended,
modified or supplemented from time to time.
A "Regulatory Capital Event" means that the Company shall have
received an opinion of independent bank regulatory counsel experienced in
such matters to the effect that, as a result of (a) any amendment to, or
change (including any announced prospective change) in, the laws (or any
regulations thereunder) of the United States or any rules,
8
guidelines or policies of the Federal Reserve or (b) any official
administrative pronouncement or judicial decision interpreting or applying
such laws or regulations, which amendment or change is effective or such
pronouncement or decision is announced on or after June 3, 1997, the Capital
Securities do not constitute, or within 90 days of the date thereof, will not
constitute, Tier I Capital (or its then equivalent); provided, however, that
the distribution of the Junior Subordinated Debentures in connection with a
termination of the Trust by the Company shall not in and of itself constitute
a Regulatory Capital Event.
"Responsible Officer" shall mean any officer of the Trustee with
direct responsibility for the administration of the Indenture 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.
"Restricted Security" shall mean Securities that bear or are
required to bear the legends relating to transfer restrictions under the
Securities Act set forth in Exhibit A hereto.
"Rule 144A" means Rule 144A under the Securities Act, as such Rule
may be amended from time to time, or under any similar rule or regulation
hereafter adopted by the Commission.
"Securities" means, collectively, the Series A Securities and the
Series B Securities.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Securityholder", "holder of Securities", or other similar terms,
shall mean any Person in whose name at the time a particular Security is
registered on the register kept by the Company or the Trustee for that
purpose in accordance with the terms hereof.
"Security Register" shall mean (i) prior to a Dissolution Event, the
list of holders provided to the Trustee pursuant to Section 4.01 and (ii)
following a Dissolution Event, any security register maintained by a security
registrar for the Securities appointed by the Company following the execution
of a supplemental indenture providing for transfer procedures as provided for
in Section 2.07(a).
"Senior Indebtedness" shall mean all Indebtedness, whether
outstanding on the date of execution of this Indenture or hereafter created,
assumed or incurred, except Indebtedness Ranking on a Parity with the
Securities or Indebtedness Ranking Junior to the Securities, and any
deferrals, renewals or extensions of such Senior Indebtedness.
"Series A Securities" means the Company's Series A 10.50% Junior
Subordinated Deferrable Interest Debentures due June 1, 2027, as
authenticated and issued under this Indenture.
9
"Series B Securities" means the Company's Series B 10.50% Junior
Subordinated Deferrable Interest Debentures due June 1, 2027, as
authenticated and issued under this Indenture.
"Special Event" means either a Regulatory Capital Event or a Tax
Event.
"Special Event Redemption Price" shall mean, with respect to any
redemption of the Securities following a Special Event, an amount in cash
equal to the Make Whole Amount.
"Subsidiary" shall mean with respect to any Person, (i) any
corporation at least a majority of the outstanding voting stock of which is
owned, directly or indirectly, by such Person or by one or more of its
Subsidiaries, or by such Person and one or more of its Subsidiaries, (ii) any
general partnership, joint venture or similar entity, at least a majority of
whose outstanding partnership or similar interests shall at the time be owned
by such Person, or by one or more of its Subsidiaries, or by such Person and
one or more of its Subsidiaries and (iii) any limited partnership of which
such Person or any of its Subsidiaries is a general partner. For the
purposes of this definition, "voting stock" means shares, interests,
participations or other equivalents in the equity interest (however
designated) in such Person having ordinary voting power for the election of a
majority of the directors (or the equivalent) of such Person, other than
shares, interests, participations or other equivalents having such power only
by reason of the occurrence of a contingency.
"Tax Event" shall mean the receipt by Progress Capital Trust and the
Company of an opinion of counsel experienced in such matters to the effect
that, as a result of any amendment to, or change (including any announced
prospective change) in, the laws or any regulations thereunder of the United
States or any political subdivision or taxing authority thereof or therein or
as a result of any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change
is effective or which pronouncement or decision is announced on or after June
3, 1997, there is more than an insubstantial risk that (i) Progress Capital
Trust is, or will be within 90 days of the date of such opinion, subject to
United States Federal income tax with respect to income received or accrued
on the Securities, (ii) interest payable by the Company on the Securities is
not, or within 90 days of the date of such opinion, will not be, deductible
by the Company, in whole or in part, for United States Federal income tax
purposes or (iii) Progress Capital Trust is, or will be within 90 days of the
date of such opinion, subject to more than a de minimis amount of other
taxes, duties or other governmental charges.
"Treasury Rate" means (i) the yield, under the heading which
represents the average for the immediately prior week, appearing in the most
recently published statistical release designated "H.15(519)" or successor
publication which is published weekly by the Federal Reserve and which
establishes yields on actively traded United States Treasury securities
adjusted to constant maturity under the caption "Treasury Constant
Maturities" for the maturity corresponding to the Remaining Life (if no
maturity is within three months
10
before or after the Remaining Life, yields for the two published maturities
most closely corresponding to the Remaining Life shall be determined and the
Treasury Rate shall be interpolated or extrapolated from such yields on a
straight-line basis, rounding to the nearest month), or (ii) if such release
(or any successor release) is not published during the week preceding the
calculation date or does not contain such yields, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable Treasury
Issue, calculated equal to the Comparable Treasury Price for such prepayment
date. The Treasury Rate shall be calculated on a third Business Day
preceding the prepayment date.
"Trustee" shall mean the Person identified as "Trustee" in the first
paragraph hereof, and, subject to the provisions of Article VI hereof, shall
also include its successors and assigns as Trustee hereunder. The term
"Trustee" as used with respect to a particular series of the Securities shall
mean the trustee with respect to that series.
"Trust Indenture Act of 1939" shall mean the Trust Indenture Act of
1939 as in force at the date of execution of this Indenture; provided,
however, that, in the event the Trust Indenture Act of 1939 is amended after
such date, "Trust Indenture Act of 1939" shall mean, to the extent required
by any such amendment, the Trust Indenture Act of 1939 as so amended.
"Trust Securities" shall mean the Capital Securities and the Common
Securities, collectively.
"U.S. Government Obligations" shall mean securities that are (i)
direct obligations of the United States of America for the payment of which
its full faith and credit is pledged or (ii) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of the
United States of America the payment of which is unconditionally guaranteed
as a full faith and credit obligation by the United States of America, which,
in either case under clauses (i) or (ii) are not callable or redeemable at
the option of the issuer thereof, and shall also include a depository receipt
issued by a bank or trust company as custodian with respect to any such U.S.
Government Obligation or a specific payment of interest on or principal of
any such U.S. Government Obligation held by such custodian for the account of
the holder of a depository receipt, provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received by
the custodian in respect of the U.S. Government Obligation or the specific
payment of interest on or principal of the U.S. Government Obligation
evidenced by such depository receipt.
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ARTICLE II
SECURITIES
SECTION 2.01. Forms Generally.
The Securities and the Trustee's certificate of authentication shall
be substantially in the form of Exhibit A, the terms of which are
incorporated in and made a part of this Indenture. The Securities may have
notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Company is subject or usage. Each Security shall be
dated the date of its authentication. The Securities shall be issued in
denominations of $1,000 and integral multiples thereof.
SECTION 2.02. Execution and Authentication.
The Securities shall be executed on behalf of the Company by a duly
authorized officer and attested by a Secretary or an Assistant Secretary.
The signature of any such person on the Securities may be manual or
facsimile. If an Officer whose signature is on a Security no longer holds
that office at the time the Security is authenticated, the Security shall
nevertheless be valid.
A Security shall not be valid until authenticated by the manual
signature of the Trustee. The signature of the Trustee shall be conclusive
evidence that the Security has been authenticated under this Indenture. The
form of Trustee's certificate of authentication to be borne by the Securities
shall be substantially as set forth in Exhibit A hereto.
The Trustee shall, upon a Company Order, authenticate for original
issue up to, and the aggregate principal amount of Securities outstanding at
any time may not exceed $15,464,000 aggregate principal amount of the
Securities, except as provided in Sections 2.07, 2.08, 2.09 and 14.05. The
series of Securities to be initially issued hereunder shall be the Series A
Securities.
SECTION 2.03. Form and Payment.
Except as provided in Section 2.05, the Securities shall be issued
in fully registered certificated form without interest coupons. Principal
of, premium, if any, and interest on the Securities issued in certificated
form will be payable, the transfer of such Securities will be registrable and
such Securities will be exchangeable for Securities bearing identical terms
and provisions at the office or agency of the Company maintained for such
purpose under Section 3.02; provided, however, that payment of interest with
respect to Securities (other than a Global Security) may be made at the
option of the Company (i) by check mailed to the holder at such address as
shall appear in the Security Register or (ii) by transfer to an account
maintained by the Person entitled thereto, provided that proper transfer
instructions have been received in writing by the relevant record date.
Notwith-
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standing the foregoing, so long as the holder of any Securities is the
Property Trustee, the payment of the principal of, premium, if any, and
interest (including Compounded Interest and Additional Sums, if any) and
Liquidated Damages, if any, on such Securities held by the Property Trustee
will be made at such place and to such account as may be designated by the
Property Trustee.
SECTION 2.04. Legends.
(a) Except as permitted by subsection (b) of this Section 2.04 or
as otherwise determined by the Company in accordance with applicable law,
each Security shall bear the applicable legends relating to restrictions on
transfer pursuant to the securities laws in substantially the form set forth
on Exhibit A hereto.
(b) In the event of an Exchange Offer, the Company shall issue and
the Trustee, upon Company Order, shall authenticate Series B Securities in
exchange for Series A Securities accepted for exchange in the Exchange Offer,
which Series B Securities shall not bear the legends required by subsection
(a) above (other than the legend dealing with the restriction referred to in
Section 2.07(a)(ii) of this Indenture), in each case unless the holder of
such Series A Securities is either (A) a broker dealer who purchased such
Series A Securities directly from the Company for resale pursuant to Rule
144A or any other available exemption under the Securities Act, (B) a Person
participating in the distribution of the Series A Securities or (C) a Person
who is an Affiliate of the Company.
SECTION 2.05. Global Security.
(a) In connection with a Dissolution Event,
(i) if any Capital Securities are held in book-entry form, the
related Definitive Securities shall be presented to the Trustee (if an
arrangement with the Depositary has been maintained) by the Property
Trustee in exchange for one or more Global Securities (as may be required
pursuant to Section 2.07) in an aggregate principal amount equal to the
aggregate principal amount of all outstanding Securities, to be
registered in the name of the Depositary, or its nominee, and delivered
by the Trustee to the Depositary for crediting to the accounts of its
participants pursuant to the instructions of the Administrative Trustees;
the Company upon any such presentation shall execute one or more Global
Securities in such aggregate principal amount and deliver the same to the
Trustee for authentication and delivery in accordance with this
Indenture; and payments on the Securities issued as a Global Security
will be made to the Depositary; and
(ii) if any Capital Securities are held in certificated form,
the related Definitive Securities may be presented to the Trustee by the
Property Trustee and any Capital Security certificate which represents
Capital Securities other than Capital Securities in book-entry form ("Non
Book-Entry Capital Securities") will be deemed
13
to represent beneficial interests in Securities presented to the Trustee
by the Property Trustee having an aggregate principal amount equal to the
aggregate liquidation amount of the Non Book-Entry Capital Securities
until such Capital Security certificates are presented to the Security
Registrar for transfer or reissuance, at which time such Capital Security
certificates will be cancelled and a Security, registered in the name of
the holder of the Capital Security certificate or the transferee of the
holder of such Capital Security certificate, as the case may be, with an
aggregate principal amount equal to the aggregate liquidation amount of
the Capital Security certificate cancelled, will be executed by the
Company and delivered to the Trustee for authentication and delivery in
accordance with this Indenture. Upon the issuance of such Securities,
Securities with an equivalent aggregate principal amount that were
presented by the Property Trustee to the Trustee will be cancelled.
(b) The Global Securities shall represent the aggregate amount of
outstanding Securities from time to time endorsed thereon; provided, that the
aggregate amount of outstanding Securities represented thereby may from time
to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Security to reflect the amount of
any increase or decrease in the amount of outstanding Securities represented
thereby shall be made by the Trustee, in accordance with instructions given
by the Company as required by this Section 2.05.
(c) The Global Securities may be transferred, in whole but not in
part, only to the Depositary, another nominee of the Depositary, or to a
successor Depositary selected or approved by the Company or to a nominee of
such successor Depositary.
(d) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary or the Depositary has ceased to
be a clearing agency registered under the Exchange Act, and a successor
Depositary is not appointed by the Company within 90 days after the Company
receives such notice or becomes aware of such condition, as the case may be,
the Company will execute, and the Trustee, upon receipt of a Company Order,
will authenticate and make available for delivery the Definitive Securities,
in authorized denominations, and in an aggregate principal amount equal to
the principal amount of the Global Security in exchange for such Global
Security. If there is an Event of Default, the Depositary shall have the
right to exchange the Global Securities for Definitive Securities. In
addition, the Company may at any time determine that the Securities shall no
longer be represented by a Global Security. In the event of such an Event of
Default or such a determination, the Company shall execute, and subject to
Section 2.07, the Trustee, upon receipt of an Officers' Certificate
evidencing such determination by the Company and a Company Order, will
authenticate and make available for delivery the Definitive Securities, in
authorized denominations, and in an aggregate principal amount equal to the
principal amount of the Global Security in exchange for such Global Security.
Upon the exchange of the Global Security for such Definitive Securities, in
authorized denominations, the Global Security shall be cancelled by the
Trustee. Such Definitive Securities issued in exchange for the Global
Security shall be registered in such names and
14
in such authorized denominations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Definitive Securities to the
Depositary for delivery to the Persons in whose names such Definitive
Securities are so registered.
SECTION 2.06 Interest.
(a) Each Security will bear interest at the rate of 10.50% per
annum (the "Coupon Rate") from the most recent date to which interest has
been paid or duly provided for or, if no interest has been paid or duly
provided for, from June 1, 1997, until the principal thereof becomes due and
payable, and at the Coupon Rate on any overdue principal (and premium, if
any) and (to the extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest, compounded
semi-annually, payable (subject to the provisions of Article XVI)
semi-annually in arrears on June 1 and December 1 of each year (each, an
"Interest Payment Date") commencing on December 1, 1997, to the Person in
whose name such Security or any predecessor Security is registered, at the
close of business on the regular record date for such interest installment,
which shall be the fifteenth day of the month immediately preceding the month
in which the relevant Interest Payment Date falls.
(b) Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months and, for any period of less than a full
calendar month, the number of days lapsed in such month based on a 30-day
month. In the event that any Interest Payment Date falls on a day that is
not a Business Day, then payment of interest payable on such date will be
made on the next succeeding day which is a Business Day (and without any
interest or other payment in respect of any such delay), except that if such
next succeeding Business Day falls in the next succeeding calendar year, then
such payment shall be made on the immediately preceding Business Day, in each
case with the same force and effect as if made on such date.
(c) During such time as the Property Trustee is the holder of any
Securities, the Company shall pay any additional amounts on the Securities as
may be necessary in order that the amount of Distributions then due and
payable by Progress Capital Trust on the outstanding Trust Securities shall
not be reduced as a result of any additional taxes, duties and other
governmental charges to which Progress Capital Trust has become subject as a
result of a Tax Event ("Additional Sums").
SECTION 2.07. Transfer and Exchange.
(a) Transfer Restrictions. (i) The Series A Securities, and those
Series B Securities with respect to which any Person described in Section
2.04(b)(A), (B) or (C) is the beneficial owner, may not be transferred except
in compliance with the legends contained in Exhibit A unless otherwise
determined by the Company in accordance with applicable law. Upon any
distribution of the Securities following a Dissolution Event, the
15
Company and the Trustee shall enter into a supplemental indenture pursuant to
Section 9.01 to provide for the transfer restrictions and procedures with
respect to the Securities substantially similar to those contained in the
Declaration to the extent applicable in the circumstances existing at such
time.
(ii) The Securities will be issued and may be transferred only
in blocks having an aggregate principal amount of not less than $100,000.
Any such transfer of the Securities in a block having an aggregate principal
amount of less than $100,000 shall be deemed to be voided and of no legal
effect whatsoever. Any such transferee shall be deemed not to be a holder of
such Securities for any purpose, including, but not limited to the receipt of
payments on such Securities, and such transferee shall be deemed to have no
interest whatsoever in such Securities.
(b) General Provisions Relating to Transfers and Exchanges. To
permit registrations of transfers and exchanges, the Company shall execute
and the Trustee shall authenticate Definitive Securities and Global
Securities at the Security Registrar's request. All Definitive Securities
and Global Securities issued upon any registration of transfer or exchange of
Definitive Securities or Global Securities shall be the valid obligations of
the Company, evidencing the same debt, and entitled to the same benefits
under this Indenture, as the Definitive Securities or Global Securities
surrendered upon such registration of transfer or exchange.
No service charge shall be made to a holder for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any transfer tax or similar governmental charge payable in
connection therewith.
The Company shall not be required to (i) issue, register the
transfer of or exchange Securities during a period beginning at the opening
of business 15 days before the day of mailing of a notice of redemption or
any notice of selection of Securities for redemption under Article XIV hereof
and ending at the close of business on the day of such mailing; or (ii)
register the transfer of or exchange any Security so selected for redemption
in whole or in part, except the unredeemed portion of any Security being
redeemed in part.
Prior to due presentment for the registration of a transfer of any
Security, the Trustee, the Company and any agent of the Trustee or the
Company may deem and treat the Person in whose name any Security is
registered as the absolute owner of such Security for the purpose of
receiving payment of principal of and premium, if any, and interest on such
Securities, neither the Trustee, nor the Company nor any agent of the Trustee
or the Company shall be affected by notice to the contrary.
16
(c) Exchange of Series A Securities for Series B Securities. The
Series A Securities may be exchanged for Series B Securities pursuant to the
terms of the Exchange Offer. The Trustee shall make the exchange as follows:
The Company shall present the Trustee with an Officers' Certificate
certifying the following:
(A) upon issuance of the Series B Securities, the transactions
contemplated by the Exchange Offer have been consummated; and
(B) the principal amount of Series A Securities properly tendered
in the Exchange Offer that are represented by a Global Security
and the principal amount of Series A Securities properly
tendered in the Exchange Offer that are represented by
Definitive Securities, the name of each holder of such
Definitive Securities, the principal amount properly tendered
in the Exchange Offer by each such holder and the name and
address to which Definitive Securities for Series B Securities
shall be registered and sent for each such holder.
The Trustee, upon receipt of (i) such Officers' Certificate, (ii) an
Opinion of Counsel (x) to the effect that the Series B Securities have been
registered under Section 5 of the Securities Act and the Indenture has been
qualified under the Trust Indenture Act and (y) with respect to the matters
set forth in Section 3(p) of the Registration Rights Agreement and (iii) a
Company Order, shall authenticate (A) a Global Security representing Series B
Securities in aggregate principal amount equal to the aggregate principal
amount of Series A Securities represented by a Global Security indicated in
such Officers' Certificate as having been properly tendered and (B)
Definitive Securities representing Series B Securities registered in the
names of, and in the principal amounts indicated in, such Officers'
Certificate.
If the principal amount of the Global Security for the Series B
Securities is less than the principal amount of the Global Security for the
Series A Securities, the Trustee shall make an endorsement on such Global
Security for Series A Securities indicating a reduction in the principal
amount represented thereby.
The Trustee shall deliver such Definitive Securities representing
Series B Securities to the holders thereof as indicated in such Officers'
Certificate.
SECTION 2.08. Replacement Securities.
If any mutilated Security is surrendered to the Trustee, or the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, the Company shall issue and the
Trustee shall authenticate a replacement Security if the Trustee's
requirements for replacements of Securities are met. An indemnity bond
17
must be supplied by the holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any agent
thereof or any authenticating agent from any loss that any of them may suffer
if a Security is replaced. The Company or the Trustee may charge for its
expenses in replacing a Security.
Every replacement Security is an obligation of the Company and shall
be entitled to all of the benefits of this Indenture equally and
proportionately with all other Securities duly issued hereunder.
SECTION 2.09. Temporary Securities.
Pending the preparation of Definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and make
available for delivery, temporary Securities that are printed, lithographed,
typewritten, mimeographed or otherwise reproduced, in any authorized
denomination, substantially of the tenor of the Definitive Securities in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities
may determine, as conclusively evidenced by their execution of such
Securities.
If temporary Securities are issued, the Company shall cause
Definitive Securities to be prepared without unreasonable delay. The
Definitive Securities shall be printed, lithographed or engraved, or provided
by any combination thereof, or in any other manner permitted by the rules and
regulations of any applicable securities exchange, all as determined by the
officers executing such Definitive Securities. After the preparation of
Definitive Securities, the temporary Securities shall be exchangeable for
Definitive Securities upon surrender of the temporary Securities at the
office or agency maintained by the Company for such purpose pursuant to
Section 3.02 hereof, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities, the Company shall
execute, and the Trustee shall authenticate and make available for delivery,
in exchange therefor the same aggregate principal amount of Definitive
Securities of authorized denominations. Until so exchanged, the temporary
Securities shall in all respects be entitled to the same benefits under this
Indenture as Definitive Securities.
SECTION 2.10. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Trustee and no one else shall cancel all Securities
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall retain or dispose of cancelled Securities in
accordance with its normal practices (subject to the record retention
requirement of the Exchange Act) unless the Company directs them to be
returned to it. The Company may not issue new Securities to replace
Securities that have been redeemed or paid or that have been delivered to the
Trustee for cancellation.
18
SECTION 2.11. Defaulted Interest.
Any interest on any Security that is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the holder on
the relevant regular record date by virtue of having been such holder; and
such Defaulted Interest shall be paid by the Company, at its election, as
provided in clause (a) or clause (b) below:
(a) The Company may make payment of any Defaulted Interest on
Securities to the Persons in whose names such Securities (or their
respective Predecessor Securities) 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 such Security 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 not be more than
15 nor less than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of the notice of
the proposed 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 Securityholder at his or her address as it
appears in the Security Register, not less than 10 days prior to such
special record date. Notice of the proposed payment of such Defaulted
Interest and the special record date therefor having been mailed as
aforesaid, such Defaulted Interest shall be paid to the Persons in whose
names such Securities (or their respective Predecessor Securities) are
registered on such special record date and shall be no longer payable
pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted Interest on any
Securities in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Securities 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 manner of payment shall be deemed
practicable by the Trustee.
19
SECTION 2.12. CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Securityholders; provided that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Securities or as contained in any
notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such redemption
shall not be affected by any defect in or omission of such numbers. The
Company will promptly notify the Trustee of any change in the CUSIP numbers.
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of the holders of
the Securities that it will duly and punctually pay or cause to be paid the
principal of, premium, if any, and interest on the Securities at the place,
at the respective times and in the manner provided herein. Except as
provided in Section 2.03, each installment of interest on the Securities may
be paid by mailing checks for such interest payable to the order of the
holder of Security entitled thereto as they appear in the Security Register.
The Company further covenants to pay any and all amounts, including, without
limitation, Additional Sums, as may be required pursuant to Section 2.06(c),
Liquidated Damages, if any, on the dates and in the manner required under the
Registration Rights Agreement and Compounded Interest, as may be required
pursuant to Section 16.01.
SECTION 3.02. Offices for Notices and Payments, etc.
So long as any of the Securities remain outstanding, the Company
will maintain in the Borough of Manhattan, The City of New York, an office or
agency where the Securities may be presented for payment, an office or agency
where the Securities may be presented for registration of transfer and for
exchange as in this Indenture provided and an office or agency where notices
and demands to or upon the Company in respect of the Securities or of this
Indenture may be served. The Company will give to the Trustee written notice
of the location of any such office or agency and of any change of location
thereof. Until otherwise designated from time to time by the Company in a
notice to the Trustee, any such office or agency for all of the above
purposes shall be the Principal Office of the Trustee. In case the Company
shall fail to maintain any such office or agency in the Borough of Manhattan,
The City of New York, or shall fail to give such notice of the location or of
any change in the location thereof, presentations and demands may be made and
notices may be served at the Principal Office of the Trustee.
20
In addition to any such office or agency, the Company may from time
to time designate one or more offices or agencies outside the Borough of
Manhattan, The City of New York, where the Securities may be presented for
payment, registration of transfer and for exchange in the manner provided in
this Indenture, and the Company may from time to time rescind such
designation, as the Company may deem desirable or expedient; provided,
however, that no such designation or rescission shall in any manner relieve
the Company of its obligation to maintain any such office or agency in the
Borough of Manhattan, The City of New York, for the purposes above mentioned.
The Company will give to the Trustee prompt written notice of any such
designation or rescission thereof.
SECTION 3.03. Appointments to Fill Vacancies in Trustee's Office.
The Company, whenever necessary to avoid or fill a vacancy in the
office of Trustee, will appoint, in the manner provided in Section 6.10, a
Trustee, so that there shall at all times be a Trustee hereunder.
SECTION 3.04. Provision as to Paying Agent.
(a) If the Company shall appoint a paying agent other than the
Trustee with respect to the Securities, it will cause such
paying agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee,
subject to the provision of this Section 3.04,
(1) that it will hold all sums held by it as such agent for
the payment of the principal of and premium, if any, or
interest on the Securities (whether such sums have been
paid to it by the Company or by any other obligor on the
Securities) in trust for the benefit of the holders of the
Securities; and
(2) that it will give the Trustee notice of any failure by the
Company (or by any other obligor on the Securities) to
make any payment of the principal of and premium or
interest (including Additional Sums and Compounded
Interest, if any) and Liquidated Damages, if any, on the
Securities when the same shall be due and payable.
(b) If the Company shall act as its own paying agent, it will, on
or before each due date of the principal of and premium, if
any, or interest on the Securities, set aside, segregate and
hold in trust for the benefit of the holders of the Securities
a sum sufficient to pay such principal, premium or interest so
becoming due and will notify the Trustee of any failure to take
such action and of any failure by the Company (or by any other
obligor under the Securities) to make any payment of the
21
principal of and premium, if any, or interest on the Securities
when the same shall become due and payable.
(c) Anything in this Section 3.04 to the contrary notwithstanding,
the Company may, at any time, for the purpose of obtaining a
satisfaction and discharge with respect to the Securities
hereunder, or for any other reason, pay or cause to be paid to
the Trustee all sums held in trust for such Securities by the
Trustee or any paying agent hereunder, as required by this
Section 3.04, such sums to be held by the Trustee upon the
trusts herein contained.
(d) Anything in this Section 3.04 to the contrary notwithstanding,
the agreement to hold sums in trust as provided in this Section
3.04 is subject to Sections 11.03 and 11.04.
SECTION 3.05. Certificate to Trustee.
The Company will deliver to the Trustee on or before 120 days after
the end of each fiscal year in each year, commencing with the first fiscal
year ending after the date hereof, so long as Securities are outstanding
hereunder, an Officers' Certificate, one of the signers of which shall be the
principal executive, principal financial or principal accounting officer of
the Company, stating that in the course of the performance by the signers of
their duties as officers of the Company they would normally have knowledge of
any default by the Company in the performance of any covenants contained
herein, stating whether or not they have knowledge of any such default and,
if so, specifying each such default of which the signers have knowledge and
the nature thereof.
SECTION 3.06. Compliance with Consolidation Provisions.
The Company will not, while any of the Securities remain
outstanding, consolidate with, or merge into, or merge into itself, or sell
or convey all or substantially all of its property to any other Person unless
the provisions of Article X hereof are complied with.
SECTION 3.07. Limitation on Dividends.
The Company will not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Company's capital stock (which includes common
and preferred stock), (ii) make any payment of principal, premium, if any, or
interest on or repay or repurchase or redeem any debt securities of the
Company (including Other Debentures) that rank pari passu with or junior in
right of payment to the Securities or (iii) make any guarantee payments with
respect to any guarantee by the Company of the debt securities of any
Subsidiary of the Company (including Other Guarantees) if such guarantee
ranks pari passu or junior in right
22
of payment to the Securities (other than (a) dividends or distributions in
shares of, or options, warrants or rights to subscribe for or purchase shares
of, Common Stock of the Company, (b) any declaration of a dividend in
connection with the implementation of a stockholder's rights plan, or the
issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto, (c) payments under the
Capital Securities Guarantee, (d) as a result of a reclassification of the
Company's capital stock or the exchange or the conversion of one class or
series of the Company's capital stock for another class or series of the
Company's capital stock, (e) the purchase of fractional interests in shares
of the Company's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged
and (f) purchases of Common Stock related to the issuance of Common Stock or
rights under any of the Company's benefit plans for its directors, officers
or employees or any of the Company's dividend reinvestment plans) if at such
time (1) there shall have occurred any event of which the Company has actual
knowledge that (a) is or, with the giving of notice or the lapse of time, or
both, would constitute an Event of Default and (b) in respect of which the
Company shall not have taken reasonable steps to cure, (2) if such Securities
are held by the Property Trustee, the Company shall be in default with
respect to its payment obligations under the Capital Securities Guarantee or
(3) the Company shall have given notice of its election of the exercise of
its right to extend the interest payment period pursuant to Section 16.01 and
any such extension shall be continuing.
SECTION 3.08. Covenants as to Progress Capital Trust
In the event Securities are issued to Progress Capital Trust or a
trustee of such trust in connection with the issuance of Trust Securities by
Progress Capital Trust, for so long as such Trust Securities remain
outstanding, the Company (i) will maintain 100% direct or indirect ownership
of the Common Securities of Progress Capital Trust; provided, however, that
any successor of the Company, permitted pursuant to Article X, may succeed to
the Company's ownership of such Common Securities, (ii) will use its
reasonable efforts to cause Progress Capital Trust (a) to remain a business
trust, except in connection with a distribution of Securities to the holders
of Trust Securities in liquidation of the Trust, the redemption of all of the
Trust Securities of Progress Capital Trust or certain mergers, consolidations
or amalgamations, each as permitted by the Declaration of Progress Capital
Trust, and (b) to otherwise continue to be treated as a grantor trust and not
an association taxable as a corporation for United States federal income tax
purposes and (iii) use its reasonable efforts to cause each holder of Trust
Securities to be treated as owning an undivided beneficial interest in the
Securities.
SECTION 3.09. Payment of Expenses.
In connection with the offering, sale and issuance of the Securities
to Progress Capital Trust and in connection with the sale of the Trust
Securities by Progress Capital Trust, the Company, in its capacity as
borrower with respect to the Securities, shall:
23
(a) pay all costs and expenses relating to the offering, sale and
issuance of the Securities, including commissions and expenses and
indemnification obligations, if any, to or for the benefit of the Initial
Purchaser (as defined in the Purchase Agreement) payable pursuant to the
Purchase Agreement, fees and expenses in connection with any exchange offer,
filing of a shelf registration statement or other action to be taken pursuant
to the Registration Rights Agreement and compensation of the Trustee in
accordance with the provisions of Section 6.06;
(b) pay all costs and expenses of the Trust (including, but not
limited to, costs and expenses relating to the organization of Progress
Capital Trust, the offering, sale and issuance of the Trust Securities
(including commissions to the initial purchasers in connection therewith),
the fees and expenses of the Property Trustee and the Delaware Trustee, the
costs and expenses relating to the operation of Progress Capital Trust,
including without limitation, costs and expenses of accountants, attorneys,
statistical or bookkeeping services, expenses for printing and engraving and
computing or accounting equipment, paying agent(s), registrar(s), transfer
agent(s), duplicating, travel and telephone and other telecommunications
expenses and costs and expenses incurred in connection with the acquisition,
financing, and disposition of assets of Progress Capital Trust;
(c) be primarily and fully liable for any indemnification
obligations arising with respect to the Declaration;
(d) pay any and all taxes (other than United States withholding
taxes attributable to Progress Capital Trust or its assets) and all
liabilities, costs and expenses with respect to such taxes of the Trust; and
(e) pay all other fees, expenses, debts and obligations (other than
in respect of principal, interest and premium, if any, on the Trust
Securities) related to Progress Capital Trust.
SECTION 3.10. Payment Upon Resignation or Removal.
Upon termination of this Indenture or the removal or resignation of
the Trustee, unless otherwise stated, the Company shall pay to the Trustee
all amounts accrued and owing to the date of such termination, removal or
resignation. Upon termination of the Declaration or the removal or
resignation of the Delaware Trustee or the Property Trustee, as the case may
be, pursuant to Section 5.7 of the Declaration, the Company shall pay to the
Delaware Trustee or the Property Trustee, as the case may be, all amounts
accrued and owing to the date of such termination, removal or resignation.
24
ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE
SECTION 4.01. Securityholders' Lists.
The Company covenants and agrees that it will furnish or cause to be
furnished to the Trustee:
(a) on a semi-annual basis on each regular record date for the
Securities, a list, in such form as the Trustee may reasonably
require, of the names and addresses of the Securityholders as
of such record date; and
(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company, of any such
request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished,
except that, no such lists need be furnished so long as the Trustee is
in possession thereof by reason of its acting as Security registrar.
SECTION 4.02. Preservation and Disclosure of Lists.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and
addresses of the holders of the Securities (1) contained in the
most recent list furnished to it as provided in Section 4.01 or
(2) received by it in the capacity of Securities registrar (if
so acting) hereunder. The Trustee may destroy any list
furnished to it as provided in Section 4.01 upon receipt of a
new list so furnished.
(b) In case three or more holders of Securities (hereinafter
referred to as "applicants") apply in writing to the Trustee
and furnish to the Trustee reasonable proof that each such
applicant has owned a Security for a period of at least six
months preceding the date of such application, and such
application states that the applicants desire to communicate
with other holders of Securities or with holders of all
Securities with respect to their rights under this Indenture
and is accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit, then
the Trustee shall within five Business Days after the receipt
of such application, at its election, either:
25
(1) afford such applicants access to the information preserved at
the time by the Trustee in accordance with the provisions of
subsection (a) of this Section 4.02, or
(2) inform such applicants as to the approximate number of holders
of all Securities, whose names and addresses appear in the
information preserved at the time by the Trustee in accordance
with the provisions of subsection (a) of this Section 4.02, and
as to the approximate cost of mailing to such Securityholders
the form of proxy or other communication, if any, specified in
such application.
If the Trustee shall elect not to afford such applicants
access to such information, the Trustee shall, upon the written
request of such applicants, mail to each Securityholder whose
name and address appear in the information preserved at the
time by the Trustee in accordance with the provisions of
subsection (a) of this Section 4.02 a copy of the form of proxy
or other communication which is specified in such request with
reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the
payment, of the reasonable expenses of mailing, unless within
five days after such tender, the Trustee shall mail to such
applicants and file with the Commission, together with a copy
of the material to be mailed, a written statement to the effect
that, in the opinion of the Trustee, such mailing would be
contrary to the best interests of the holders of Securities of
such series or all Securities, as the case may be, or would be
in violation of applicable law. Such written statement shall
specify the basis of such opinion. If the Commission, after
opportunity for a hearing upon the objections specified in the
written statement so filed, shall enter an order refusing to
sustain any of such objections or if, after the entry of an
order sustaining one or more of such objections, the Commission
shall find, after notice and opportunity for hearing, that all
the objections so sustained have been met and shall enter an
order so declaring, the Trustee shall mail copies of such
material to all such Securityholders with reasonable promptness
after the entry of such order and the renewal of such tender;
otherwise the Trustee shall be relieved of any obligation or
duty to such applicants respecting their application.
(c) Each and every holder of Securities, by receiving and holding
the same, agrees with the Company and the Trustee that neither
the Company nor the Trustee nor any paying agent shall be held
accountable by reason of the disclosure of any such information
as to the names and addresses of the holders of Securities in
accordance with the provisions of subsection (b) of this
Section 4.02, regardless of the
26
source from which such information was derived, and that the
Trustee shall not be held accountable by reason of mailing any
material pursuant to a request made under said subsection (b).
SECTION 4.03. Reports by Company.
(a) The Company covenants and agrees to file with the Trustee,
within 15 days after the date on which the Company is required
to file the same with the Commission, copies of the 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 the
Commission pursuant to Section 13 or Section 15(d) of the
Exchange Act; or, if the Company is not required to file
information, documents or reports pursuant to either of such
sections, then to file with the Trustee and the Commission, in
accordance with rules and regulations prescribed from time to
time by the Commission, such of the supplementary and periodic
information, documents and reports which may be required
pursuant to Section 13 of the Exchange Act in respect of a
security listed and registered on a national securities
exchange as may be prescribed from time to time in such rules
and regulations.
(b) The Company covenants and agrees to file with the Trustee and
the Commission, in accordance with the rules and regulations
prescribed from time to time by said Commission, such
additional information, documents and reports with respect to
compliance by the Company with the conditions and covenants
provided for in this Indenture as may be required from time to
time by such rules and regulations.
(c) The Company covenants and agrees to transmit by mail to all
holders of Securities, as the names and addresses of such
holders appear upon the Security Register, within 30 days after
the filing thereof with the Trustee, such summaries of any
information, documents and reports required to be filed by the
Company pursuant to subsections (a) and (b) of this Section
4.03 as may be required by rules and regulations prescribed
from time to time by the Commission.
(d) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's
receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information
contained therein, including the Company's compliance with any
of its covenants hereunder (as to
27
which the Trustee is entitled to rely exclusively on Officers'
Certificates).
(e) So long as is required for an offer or sale of the Securities
to qualify for an exemption under Rule 144A under the
Securities Act, the Company shall, upon request, provide the
information required by clause (d)(4) thereunder to each
Securityholder and to each beneficial owner and prospective
purchaser of Securities identified by each Securityholder of
Restricted Securities, unless such information is furnished to
the Commission pursuant to Section 13 or 15(d) of the Exchange
Act.
SECTION 4.04. Reports by the Trustee.
(a) The Trustee shall transmit to Securityholders such reports
concerning the Trustee and its actions under this Indenture as
may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant thereto. If required
by Section 313(a) of the Trust Indenture Act, the Trustee
shall, within sixty days after each May 15 following the date
of this Indenture, commencing May 15, 1998, deliver to
Securityholders a brief report, dated as of such May 15, which
complies with the provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such
transmission to Securityholders, be filed by the Trustee with
each stock exchange, if any, upon which the Securities are
listed, with the Commission and with the Company. The Company
will promptly notify the Trustee when the Securities are listed
on any stock exchange.
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.01. Events of Default.
One or more of the following events of default shall constitute an
Event of Default hereunder:
(a) default in the payment of any interest (including Compounded
Interest or Additional Sums, if any) or Liquidated Damages, if
any, upon any Security or any Other Debentures when it becomes
due and payable, and continuance of such default for a period
of 30 days; provided,
28
however, that a valid extension of an interest payment period
by the Company in accordance with the terms hereof shall not
constitute a default in the payment of interest for this
purpose; or
(b) default in the payment of all or any part of the principal of
(or premium, if any, on) any Security or any Other Debentures
as and when the same shall become due and payable either at
maturity, upon redemption, by declaration of acceleration of
maturity or otherwise; or
(c) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a
covenant or warranty a default in whose performance or whose
breach is elsewhere in this Section specifically dealt with),
and continuance of such default or breach for a period of 90
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 25% in aggregate principal
amount of the outstanding Securities 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
(d) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Company in an
involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Company or for any
substantial part of its property, or ordering the winding-up or
liquidation of its affairs and such decree or order shall
remain unstayed and in effect for a period of 90 consecutive
days; or
(e) the Company shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, shall consent to the entry of an order for
relief in an involuntary case under any such law, or shall
consent to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian,
sequestrator (or other similar official) of the Company or of
any substantial part of its property, or shall make any general
assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due.
If an Event of Default with respect to Securities at the time
outstanding occurs and is continuing, then in every such case the Trustee or
the holders of not less than 25% in aggregate principal amount of the
Securities then outstanding may declare the principal amount of all
Securities to be due and payable immediately, by a notice in writing to the
29
Company (and to the Trustee if given by the holders of the outstanding
Securities), and upon any such declaration the same shall become immediately
due and payable.
The foregoing provisions, however, are subject to the condition that
if, at any time after the principal of the Securities shall have been so
declared due and payable, and before any judgment or decree for the payment
of the moneys due shall have been obtained or entered as hereinafter
provided, (i) the Company shall pay or shall deposit with the Trustee a sum
sufficient to pay (A) all matured installments of interest (including
Compounded Interest and Additional Sums, if any) and Liquidated Damages, if
any, upon all the Securities and the principal of and premium, if any, on any
and all Securities which shall have become due otherwise than by acceleration
(with interest upon such principal and premium, if any, and, to the extent
that payment of such interest is enforceable under applicable law, on overdue
installments of interest, at the same rate as the rate of interest specified
in the Securities to the date of such payment or deposit) and (B) such amount
as shall be sufficient to cover compensation due to the Trustee and each
predecessor Trustee, their respective agents, attorneys and counsel, pursuant
to Section 6.06, and (ii) any and all Events of Default under the Indenture,
other than the non-payment of the principal of the Securities which shall
have become due solely by such declaration of acceleration, shall have been
cured, waived or otherwise remedied as provided herein, then, in every such
case, the holders of a majority in aggregate principal amount of the
Securities then outstanding, by written notice to the Company and to the
Trustee, may rescind and annul such declaration and its consequences, but no
such waiver or rescission and annulment shall extend to or shall affect any
subsequent default or shall impair any right consequent thereon.
In case the Trustee shall have proceeded to enforce any right under
this Indenture and such proceedings shall have been discontinued or abandoned
because of such rescission or annulment or for any other reason or shall have
been determined adversely to the Trustee, then and in every such case the
Company, the Trustee and the holders of the Securities shall be restored
respectively to their several positions and rights hereunder, and all rights,
remedies and powers of the Company, the Trustee and the holders of the
Securities shall continue as though no such proceeding had been taken.
SECTION 5.02. Payment of Securities on Default; Suit Therefor.
The Company covenants that (a) in case default shall be made in the
payment of any installment of interest (including Compounded Interest and
Additional Sums, if any) and Liquidated Damages, if any, upon any of the
Securities as and when the same shall become due and payable, and such
default shall have continued for a period of 30 days, or (b) in case default
shall be made in the payment of the principal of or premium, if any, on any
of the Securities as and when the same shall have become due and payable,
whether at maturity of the Securities or upon redemption or by declaration or
otherwise, then, upon demand of the Trustee, the Company will pay to the
Trustee, for the benefit of the holders of the Securities, the whole amount
that then shall have become due and payable on all such Securities for
principal and premium, if any, or interest (including Compounded
30
Interest and Additional Sums, if any) and Liquidated Damages, if any, or
both, as the case may be, with interest upon the overdue principal and
premium, if any, and (to the extent that payment of such interest is
enforceable under applicable law and, if the Securities are held by Progress
Capital Trust or a trustee of such trust, without duplication of any other
amounts paid by Progress Capital Trust or a trustee in respect thereof) upon
the overdue installments of interest (including Compounded Interest and
Additional Sums, if any) and Liquidated Damages, if any, at the rate borne by
the Securities; and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including a
reasonable compensation to the Trustee, its agents, attorneys and counsel,
and any other amount due to the Trustee pursuant to Section 6.06.
In case the Company shall fail forthwith to pay such amounts upon
such demand, the Trustee, in its own name and as trustee of an express trust,
shall be entitled and empowered to institute any actions or proceedings at
law or in equity for the collection of the sums so due and unpaid, and may
prosecute any such action or proceeding to judgment or final decree, and may
enforce any such judgment or final decree against the Company or any other
obligor on the Securities and collect in the manner provided by law out of
the property of the Company or any other obligor on the Securities wherever
situated the moneys adjudged or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Securities
under Xxxxx 00, Xxxxxx Xxxxxx Code, or any other applicable law, or in case a
receiver or trustee shall have been appointed for the property of the Company
or such other obligor, or in the case of any other similar judicial
proceedings relative to the Company or other obligor upon the Securities, or
to the creditors or property of the Company or such other obligor, the
Trustee, irrespective of whether the principal of the Securities shall then
be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand pursuant to
the provisions of this Section 5.02, shall be entitled and empowered, by
intervention in such proceedings or otherwise, to file and prove a claim or
claims for the whole amount of principal and interest owing and unpaid in
respect of the Securities and, in case of any judicial proceedings, to file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any claim for
amounts due to the Trustee pursuant to 6.06) and of the Securityholders
allowed in such judicial proceedings relative to the Company or any other
obligor on the Securities, or to the creditors or property of the Company or
such other obligor, unless prohibited by applicable law and regulations, to
vote on behalf of the holders of the Securities in any election of a trustee
or a standby trustee in arrangement, reorganization, liquidation or other
bankruptcy or insolvency proceedings or person performing similar functions
in comparable proceedings, and to collect and receive any moneys or other
property payable or deliverable on any such claims, and to distribute the
same after the deduction of its charges and expenses; and any receiver,
assignee or trustee in bankruptcy or reorganization is hereby authorized by
each of the Securityholders to make such payments to the Trustee, and, in the
event that the Trustee shall consent to the making of
31
such payments directly to the Securityholders, to pay to the Trustee such
amounts as shall be sufficient to cover reasonable compensation to the
Trustee, each predecessor Trustee and their respective agents, attorneys and
counsel, and all other amounts due to the Trustee pursuant to Section 6.06.
Nothing herein contained shall be construed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Securityholder
any plan of reorganization, arrangement, adjustment or composition affecting
the Securities or the rights of any holder thereof or to authorize the
Trustee to vote in respect of the claim of any Securityholder in any such
proceeding.
All rights of action and of asserting claims under this Indenture,
or under any of the Securities, may be enforced by the Trustee without the
possession of any of the Securities, or the production thereof on any trial
or other proceeding relative thereto, and any such suit or proceeding
instituted by the Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment shall be for the ratable benefit
of the holders of the Securities.
In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the
holders of the Securities, and it shall not be necessary to make any holders
of the Securities parties to any such proceedings.
SECTION 5.03. Application of Moneys Collected by Trustee.
Any moneys collected by the Trustee shall be applied in the order
following, at the date or dates fixed by the Trustee for the distribution of
such moneys, upon presentation of the Securities in respect of which moneys
have been collected, and stamping thereon the payment, if only partially
paid, and upon surrender thereof if fully paid:
First: To the payment of costs and expenses of collection
applicable to the Securities and all other amounts due to the Trustee under
Section 6.06;
Second: To the payment of all Senior Indebtedness of the Company if
and to the extent required by Article XV;
Third: In case the principal of the outstanding Securities in
respect of which moneys have been collected shall not have become due and be
unpaid, to the payment of the amounts then due and unpaid upon Securities for
principal of (and premium, if any) and interest (including Compounded
Interest and Additional Sums, if any) and Liquidated Damages, if any, on the
Securities, in respect of which or for the benefit of which money has been
collected, ratably, without preference of priority of any kind, according to
the amounts due on such Securities for principal (and premium, if any) and
interest, respectively; and
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Fourth: To the Company.
SECTION 5.04. Proceedings by Securityholders.
No holder of any Security shall have any right by virtue of or by
availing of any provision of this Indenture to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Indenture or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless such holder previously shall have given to the
Trustee written notice of an Event of Default and of the continuance thereof
with respect to the Securities specifying such Event of Default, as
hereinbefore provided, and unless also the holders of not less than 25% in
aggregate principal amount of the Securities then outstanding shall have made
written request upon the Trustee to institute such action, suit or proceeding
in its own name as Trustee hereunder and shall have offered to the Trustee
such reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee for 60 days
after its receipt of such notice, request and offer of indemnity shall have
failed to institute any such action, suit or proceeding, it being understood
and intended, and being expressly covenanted by the taker and holder of every
Security with every other taker and holder and the Trustee, that no one or
more holders of Securities 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 holder of Securities, or to
obtain or seek to obtain priority over or preference to any other such
holder, or to enforce any right under this Indenture, except in the manner
herein provided and for the equal, ratable and common benefit of all holders
of Securities.
Notwithstanding any other provisions in this Indenture, however, the
right of any holder of any Security to receive payment of the principal of
(premium, if any) and interest (including Compounded Interest and Additional
Sums, if any) and Liquidated Damages, if any, on such Security, on or after
the same shall have become due and payable, or to institute suit for the
enforcement of any such payment, shall not be impaired or affected without
the consent of such holder and by accepting a Security hereunder it is
expressly understood, intended and covenanted by the taker and holder of
every Security with every other such taker and holder and the Trustee, that
no one or more holders of Securities shall have any right in any manner
whatsoever by virtue or by availing of any provision of this Indenture to
affect, disturb or prejudice the rights of the holders of any other
Securities, or to obtain or seek to obtain priority over or preference to any
other such holder, or to enforce any right under this Indenture, except in
the manner herein provided and for the equal, ratable and common benefit of
all holders of Securities. For the protection and enforcement of the
provisions of this Section, each and every Securityholder and the Trustee
shall be entitled to such relief as can be given either at law or in equity.
The Company and the Trustee acknowledge that pursuant to the
Declaration, the holders of Capital Securities are entitled, in the
circumstances and subject to the limitations set forth therein, to commence a
Direct Action with respect to any Event of Default under this Indenture and
the Securities.
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SECTION 5.05. Proceedings by Trustee.
In case an Event of Default occurs with respect to Securities and is
continuing, the Trustee may in its discretion proceed to protect and enforce
the rights vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce
any of such rights, either by suit in equity or by action at law or by
proceeding in bankruptcy or otherwise, whether for the specific enforcement
of any covenant or agreement contained in this Indenture or in aid of the
exercise of any power granted in this Indenture, or to enforce any other
legal or equitable right vested in the Trustee by this Indenture or by law.
SECTION 5.06. Remedies Cumulative and Continuing.
All powers and remedies given by this Article V to the Trustee or to
the Securityholders shall, to the extent permitted by law, be deemed
cumulative and not exclusive of any other powers and remedies available to
the Trustee or the holders of the Securities, by judicial proceedings or
otherwise, to enforce the performance or observance of the covenants and
agreements contained in this Indenture or otherwise established with respect
to the Securities, and no delay or omission of the Trustee or of any holder
of any of the Securities to exercise any right or power accruing upon any
Event of Default occurring and continuing as aforesaid shall impair any such
right or power, or shall be construed to be a waiver of any such default or
an acquiescence therein; and, subject to the provisions of Section 5.04,
every power and remedy given by this Article V or by law to the Trustee or to
the Securityholders may be exercised from time to time, and as often as shall
be deemed expedient, by the Trustee or by the Securityholders.
SECTION 5.07. Direction of Proceedings and Waiver of Defaults by
Majority of Securityholders.
The holders of a majority in aggregate principal amount of the
Securities at the time outstanding shall have the right to direct the time,
method, and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the Trustee;
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 shall determine that the action so directed would be unjustly
prejudicial to the holders not taking part in such direction or if the
Trustee being advised by counsel determines that the action or proceeding so
directed may not lawfully be taken or if the Trustee in good faith by its
board of directors or trustees, executive committee, or a trust committee of
directors or trustees and/or Responsible Officers shall determine that the
action or proceedings so directed would involve the Trustee in personal
liability. Prior to any declaration accelerating the maturity of the
Securities, the holders of a majority in aggregate principal amount of the
Securities at the time outstanding may on behalf of the holders of all of the
Securities waive any past default or Event of Default and its consequences
except a default (a) in the payment of principal of or premium, if any, or
interest (including Compounded
34
Interest and Additional Sums, if any) or Liquidated Damages, if any, on any
of the Securities or (b) in respect of covenants or provisions hereof which
cannot be modified or amended without the consent of the holder of each
Security affected; provided, however, that if the Securities are held by the
Property Trustee, such waiver or modification to such waiver shall not be
effective until the holders of a majority in aggregate liquidation amount of
Trust Securities shall have consented to such waiver or modification to such
waiver; provided further, that if the consent of the holder of each
outstanding Security is required, such waiver shall not be effective until
each holder of the Trust Securities shall have consented to such waiver.
Upon any such waiver, the default covered thereby shall be deemed to be cured
for all purposes of this Indenture and the Company, the Trustee and the
holders of the Securities shall be restored to their former positions and
rights hereunder, respectively; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon. Whenever
any default or Event of Default hereunder shall have been waived as permitted
by this Section 5.07, said default or Event of Default shall for all purposes
of the Securities and this Indenture be deemed to have been cured and to be
not continuing.
SECTION 5.08. Notice of Defaults.
The Trustee shall, within 90 days after the occurrence of a default
with respect to the Securities known to a Responsible Officer of the Trustee,
mail to all Securityholders, as the names and addresses of such holders
appear upon the Security Register, notice of all defaults known to the
Trustee, unless such defaults shall have been cured before the giving of such
notice (the term "defaults" for the purpose of this Section 5.08 being hereby
defined to be the events specified in clauses (a), (b), (c), (d) and (e) of
Section 5.01, not including periods of grace, if any, provided for therein,
and irrespective of the giving of written notice specified in clause (c) of
Section 5.01); and provided that, except in the case of default in the
payment of the principal of or premium, if any, or interest (including
Compounded Interest or Additional Sums, if any) or Liquidated Damages, if
any, on any of the Securities, 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 determines that the withholding of such notice is
in the interests of the Securityholders; and provided further, that in the
case of any default of the character specified in Section 5.01(c) no such
notice to Securityholders shall be given until at least 60 days after the
occurrence thereof but shall be given within 90 days after such occurrence.
SECTION 5.09. Undertaking to Pay Costs.
All parties to this Indenture agree, and each holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may
in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against the Trustee for any
action taken or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such
35
court may in its discretion assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by
such party litigant; but the provisions of this Section 5.09 shall not apply
to any suit instituted by the Trustee, to any suit instituted by any
Securityholder, or group of Securityholders, holding in the aggregate more
than 10% in aggregate principal amount of the Securities outstanding, or to
any suit instituted by any Securityholder for the enforcement of the payment
of the principal of (or premium, if any) or interest (including Compounded
Interest and Additional Sums, if any) or Liquidated Damages, if any, on any
Security against the Company on or after the same shall have become due and
payable.
ARTICLE VI
CONCERNING THE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Trustee.
With respect to the holders of the Securities issued hereunder, the
Trustee, prior to the occurrence of an Event of Default and after the curing
or waiving of all Events of Default which may have occurred, undertakes to
perform such duties and only such duties as are specifically set forth in
this Indenture. In case an Event of Default has occurred (which has not been
cured or waived) the Trustee shall exercise such of the rights and powers
vested in it by this Indenture, and use the same degree of care and skill in
their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have
occurred,
(1) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this
Indenture, and the Trustee shall not be liable except for
the performance of such duties and obligations 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 the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon any
36
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) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer or Officers, unless it
shall be proved that the Trustee was negligent in ascertaining
the pertinent facts; and
(c) 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 Securityholders pursuant to Section
5.07, 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.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any
of its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or liability is not reasonably assured to it under
the terms of this Indenture or adequate indemnity against such risk is not
reasonably assured to it.
SECTION 6.02. Reliance on Documents, Opinions, etc.
Except as otherwise provided in Section 6.01:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request,
consent, order, bond, note, 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, direction, order or demand of the Company
mentioned herein may be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof be herein
specifically prescribed); and any Board Resolution may be
evidenced to the Trustee by a copy thereof certified by the
Secretary or an Assistant Secretary of the Company;
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(c) the Trustee may consult with counsel of its selection and any
advice or Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or
suffered omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request,
order or direction of any of the Securityholders, pursuant to
the provisions of this Indenture, unless such Securityholders
shall have offered to the Trustee reasonable and sufficient
security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or omitted
by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by
this Indenture; nothing contained herein shall, however,
relieve the Trustee of the obligation, upon the occurrence of
an Event of Default (that has not been cured or waived), to
exercise such of the rights and powers vested in it by this
Indenture, and to use the same degree of care and skill in
their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs;
(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,
consent, order, approval, bond, debenture, coupon or other
paper or document, unless requested in writing to do so by the
holders of a majority in aggregate principal amount of the
outstanding Securities; provided, however, that if the payment
within a reasonable time to the Trustee of the costs, expenses
or liabilities likely to be incurred by it in the making of
such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to
it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such expense or liability as a
condition to so proceeding;
(g) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or
through agents (including any Authenticating Agent) or
attorneys, and the Trustee shall not be responsible for any
misconduct or negligence on the part of any such agent or
attorney appointed by it with due care;
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(h) the Trustee shall not be charged with knowledge of any Default
or Event of Default with respect to the Securities unless (1)
such default is a default under Sections 5.01(a) (other than a
default with respect to the payment of Compounded Interest,
Liquidated Damages or Additional Sums) and 5.01(b) of the
Indenture, (2) a Responsible Officer shall have actual
knowledge of such Default or Event of Default or (3) written
notice of such Default or Event of Default shall have been
given to the Trustee by the Company or any other obligor on the
Securities or by any holder of the Securities; and
(i) the Trustee shall not be liable for any action taken, suffered
or omitted by it in good faith, without negligence or willful
misconduct and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this
Indenture.
SECTION 6.03. No Responsibility for Recitals, etc.
The recitals contained herein and in the Securities (except in the
certificate of authentication of the Trustee or the Authenticating Agent)
shall be taken as the statements of the Company and the Trustee and the
Authenticating Agent assume no responsibility for the correctness of the
same. The Trustee and the Authenticating Agent make no representations as to
the validity or sufficiency of this Indenture or of the Securities. The
Trustee and the Authenticating Agent shall not be accountable for the use or
application by the Company of any Securities or the proceeds of any
Securities authenticated and delivered by the Trustee or the Authenticating
Agent in conformity with the provisions of this Indenture. The Trustee shall
not be charged with knowledge of any default or Event of Default under
Section 5.01 (a) or (b) relating to Other Debentures unless (i) a Responsible
Officer of the Trustee assigned to its Principal Office shall have actual
knowledge thereof or (ii) the Corporation, any Securityholder or the holder
of any Other Debenture shall have given the Trustee written notice thereof in
accordance with Section 13.04.
SECTION 6.04. Trustee, Authenticating Agent, Paying Agents, Transfer
Agents or Registrar May Own Securities.
The Trustee or any Authenticating Agent or any paying agent or any
transfer agent or any Security registrar, in its individual or any other
capacity, may become the owner or pledgee of Securities with the same rights
it would have if it were not Trustee, Authenticating Agent, paying agent,
transfer agent or Security registrar.
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SECTION 6.05. Moneys to be Held in Trust.
Subject to the provisions of Section 11.04, all moneys received by
the Trustee or any paying agent shall, until used or applied as herein
provided, be held in trust for the purpose for which they were received, but
need not be segregated from other funds except to the extent required by law.
The Trustee and any paying agent shall be under no liability for interest on
any money received by it hereunder except as otherwise agreed in writing with
the Company. So long as no Event of Default shall have occurred and be
continuing, all interest allowed on any such moneys shall be paid from time
to time upon the written order of the Company, signed by the Chairman of the
Board of Directors, the President, a Vice President, the Treasurer or an
Assistant Treasurer of the Company.
SECTION 6.06. Compensation and Expenses of Trustee.
The Company, as issuer of Securities under this Indenture, covenants
and agrees to pay to the Trustee from time to time, and the Trustee shall be
entitled to, such compensation as shall be agreed to in writing between the
Company and the Trustee (which shall not be limited by any provision of law
in regard to the compensation of a trustee of an express trust), and the
Company will pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and
of all persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence or bad faith. The
Company also covenants to indemnify each of the Trustee or any predecessor
Trustee (and its officers, agents, directors and employees) for, and to hold
it harmless against, any and all loss, damage, claim, liability or expense
including taxes (other than taxes based on the income of the Trustee)
incurred without negligence or bad faith on the part of the Trustee and
arising out of or in connection with the acceptance or administration of this
trust, including the costs and expenses of defending itself against any claim
of liability in the premises. The obligations of the Company under this
Section 6.06 to compensate and indemnify the Trustee and to pay or reimburse
the Trustee for expenses, disbursements and advances shall constitute
additional indebtedness hereunder. Such additional indebtedness shall be
secured by a lien prior to that of the Securities upon all property and funds
held or collected by the Trustee as such, except funds held in trust for the
benefit of the holders of particular Securities.
When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 5.01(d) or Section 5.01(e), the
expenses (including the reasonable charges and expenses of its counsel) and
the compensation for the services are intended to constitute expenses of
administration under any applicable federal or state bankruptcy, insolvency
or other similar law.
The provisions of this Section shall survive the resignation or
removal of the Trustee and the defeasance or other termination of this
Indenture.
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SECTION 6.07. Officers' Certificate as Evidence.
Except as otherwise provided in Sections 6.01 and 6.02, whenever in
the administration of the provisions of this Indenture the Trustee shall deem
it necessary or desirable that a matter be proved or established prior to
taking or omitting any action hereunder, such matter (unless other evidence
in respect thereof is herein specifically prescribed) may, in the absence of
negligence or bad faith on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers' Certificate delivered to
the Trustee, and such certificate, in the absence of negligence or bad faith
on the part of the Trustee, shall be full warrant to the Trustee for any
action taken or omitted by it under the provisions of this Indenture upon the
faith thereof.
SECTION 6.08. Conflicting Interest of Trustee.
If the Trustee has or shall acquire any "conflicting interest"
within the meaning of Section 310(b) of the Trust Indenture Act, the Trustee
and the Company shall in all respects comply with the provisions of Section
310(b) of the Trust Indenture Act.
SECTION 6.09. Eligibility of Trustee.
The Trustee hereunder shall at all times be a corporation organized
and doing business under the laws of the United States of America or any
state or territory thereof or of the District of Columbia or a corporation or
other Person permitted to act as trustee by the Commission authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least 50 million U.S. dollars ($50,000,000) and subject to
supervision or examination by federal, state, territorial, or District of
Columbia 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 purposes of this Section
6.09 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.
The Company may not, nor may any Person directly or indirectly
controlling, controlled by, or under common control with the Company, serve
as Trustee.
In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 6.09, the Trustee shall resign
immediately in the manner and with the effect specified in Section 6.10.
SECTION 6.10. Resignation or Removal of Trustee.
(a) The Trustee, or any trustee or trustees hereafter appointed,
may at any time resign by giving written notice of such
resignation to the Company and by mailing notice thereof to the
holders of the Securities at their
41
addresses as they shall appear on the Security register. Upon
receiving such notice of resignation, the Company shall
promptly appoint a successor trustee or trustees by written
instrument, in duplicate, one copy of which instrument shall be
delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so
appointed and have accepted appointment within 60 days after
the mailing of such notice of resignation to the affected
Securityholders, the resigning Trustee may petition any court
of competent jurisdiction for the appointment of a successor
trustee, or any Securityholder who has been a bona fide holder
of a Security for at least six months may, subject to the
provisions of Section 5.09, on behalf of himself and all others
similarly situated, petition any such court for the appointment
of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and prescribe, appoint a
successor trustee.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with the provisions of
Section 6.08 after written request therefor by the Company
or by any Securityholder who has been a bona fide holder
of a Security or Securities for at least six months, or
(2) the Trustee shall cease to be eligible in accordance with
the provisions of Section 6.09 and shall fail to resign
after written request therefor by the Company or by any
such Securityholder, or
(3) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver 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,
then, in any such case, the Company may remove the Trustee and
appoint a successor trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to
the Trustee so removed and one copy to the successor trustee,
or, subject to the provisions of Section 5.09, any
Securityholder who has been a bona fide holder of a Security
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. Such court may thereupon, after such
notice, if any, as it may
42
deem proper and prescribe, remove the Trustee and appoint a
successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Securities at the time outstanding may at any time remove the
Trustee and nominate a successor trustee, which shall be deemed
appointed as successor trustee unless within 10 days after such
nomination the Company objects thereto or if no successor
trustee shall have been so appointed and shall have accepted
appointment within 30 days after such removal, in which case
the Trustee so removed or any Securityholder, upon the terms
and conditions and otherwise as in subsection (a) of this
Section 6.10 provided, may petition any court of competent
jurisdiction for an appointment of a successor trustee.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this
Section 6.10 shall become effective upon acceptance of
appointment by the successor trustee as provided in Section
6.11.
SECTION 6.11. Acceptance by Successor Trustee.
Any successor trustee appointed as provided in Section 6.10 shall
execute, acknowledge and deliver to the Company and to its predecessor
trustee an instrument accepting such appointment hereunder, 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, duties and obligations of its
predecessor hereunder, with like effect as if originally named as trustee
herein; but, nevertheless, on the written request of the Company or of the
successor trustee, the trustee ceasing to act shall, upon payment of any
amounts then due it pursuant to the provisions of Section 6.06, execute and
deliver an instrument transferring to such successor trustee all the rights
and powers of the trustee so ceasing to act and shall duly assign, transfer
and deliver to such successor trustee all property and money held by such
retiring trustee thereunder. Upon request of any such successor trustee, the
Company shall execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor trustee all such rights
and powers. Any trustee ceasing to act shall, nevertheless, retain a lien
upon all property or funds held or collected by such trustee to secure any
amounts then due it pursuant to the provisions of Section 6.06.
No successor trustee shall accept appointment as provided in this
Section 6.11 unless at the time of such acceptance such successor trustee
shall be qualified under the provisions of Section 6.08 and eligible under
the provisions of Section 6.09.
Upon acceptance of appointment by a successor trustee as provided in
this Section 6.11, the Company shall mail notice of the succession of such
trustee hereunder to
43
the holders of Securities at their addresses as they shall appear on the
Security register. If the Company fails to mail such notice within 10 days
after the acceptance of appointment by the successor trustee, the successor
trustee shall cause such notice to be mailed at the expense of the Company.
SECTION 6.12. Succession by Merger, etc.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation 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
without the execution or filing of any paper or any further act on the part
of any of the parties hereto.
In case at the time such successor to the Trustee shall succeed to
the trusts created by this Indenture any Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt
the certificate of authentication of any predecessor trustee, and deliver
such Securities so authenticated; and in case at that time any of the
Securities shall not have been authenticated, any successor to the Trustee
may authenticate such Securities either in the name of any predecessor
hereunder or in the name of the successor trustee; and in all such cases such
certificates shall have the full force which the Securities or this Indenture
elsewhere provides that the certificate of the Trustee shall have; provided,
however, that the right to adopt the certificate of authentication of any
predecessor Trustee or authenticate Securities in the name of any predecessor
Trustee shall apply only to its successor or successors by merger, conversion
or consolidation.
SECTION 6.13. Limitation on Rights of Trustee as a Creditor.
The Trustee shall comply with Section 311(a) of the Trust Indenture
Act, excluding any creditor relationship described in Section 311(b) of the
Trust Indenture Act. A Trustee who has resigned or been removed shall be
subject to Section 311(a) of the Trust Indenture Act to the extent included
therein.
SECTION 6.14. Authenticating Agents.
There may be one or more Authenticating Agents appointed by the
Trustee upon the request of the Company with power to act on its behalf and
subject to its direction in the authentication and delivery of Securities
issued upon exchange or transfer thereof as fully to all intents and purposes
as though any such Authenticating Agent had been expressly authorized to
authenticate and deliver Securities; provided, that the Trustee shall have no
liability to the Company for any acts or omissions of the Authenticating
Agent with respect to the authentication and delivery of Securities. Any
such Authenticating Agent shall at all times be a corporation organized and
doing business under the laws of the United States or of any state or
territory thereof or of the District of Columbia authorized under such laws
44
to act as Authenticating Agent, having a combined capital and surplus of at
least $50,000,000 and being subject to supervision or examination by federal,
state, territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually pursuant to law or the
requirements of such authority, then for the purposes of this Section 6.14
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 an Authenticating Agent shall cease
to be eligible in accordance with the provisions of this Section, it shall
resign immediately in the manner and with the effect herein specified in this
Section.
Any corporation into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authenticating
Agent shall be a party, or any corporation succeeding to the corporate trust
business of any Authenticating Agent, shall be the successor of such
Authenticating Agent hereunder, if such successor corporation is otherwise
eligible under this Section 6.14 without the execution or filing of any paper
or any further act on the part of the parties hereto or such Authenticating
Agent.
Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company. The Trustee may at
any time terminate the agency of any Authenticating Agent by giving written
notice of termination to such Authenticating Agent and to the Company. Upon
receiving such a notice of resignation or upon such a termination, or in case
at any time any Authenticating Agent shall cease to be eligible under this
Section 6.14, the Trustee may, and upon the request of the Company shall,
promptly appoint a successor Authenticating Agent eligible under this Section
6.14, shall give written notice of such appointment to the Company and shall
mail notice of such appointment to all Securityholders as the names and
addresses of such holders appear on the Security Register. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall
become vested with all rights, powers, duties and responsibilities of its
predecessor hereunder, with like effect as if originally named as
Authenticating Agent herein.
The Company, as borrower, agrees to pay to any Authenticating Agent
from time to time reasonable compensation for its services. Any
Authenticating Agent shall have no responsibility or liability for any action
taken by it as such in accordance with the directions of the Trustee.
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ARTICLE VII
CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Action by Securityholders.
Whenever in this Indenture it is provided that the holders of a
specified percentage in aggregate principal amount of the Securities may take
any action (including the making of any demand or request, the giving of any
notice, consent or waiver or the taking of any other action) the fact that at
the time of taking any such action the holders of such specified percentage
have joined therein may be evidenced (a) by any instrument or any number of
instruments of similar tenor executed by such Securityholders in person or by
agent or proxy appointed in writing, or (b) by the record of such holders of
Securities voting in favor thereof at any meeting of such Securityholders
duly called and held in accordance with the provisions of Article VIII, or
(c) by a combination of such instrument or instruments and any such record of
such a meeting of such Securityholders.
If the Company shall solicit from the Securityholders any request,
demand, authorization, direction, notice, consent, waiver or other action,
the Company may, at its option, as evidenced by an Officers' Certificate, fix
in advance a record date for the determination of Securityholders entitled to
give such request, demand, authorization, direction, notice, consent, waiver
or other action, but the Company shall have no obligation to do so. If such
a record date is fixed, such request, demand, authorization, direction,
notice, consent, waiver or other action may be given before or after the
record date, but only the Securityholders of record at the close of business
on the record date shall be deemed to be Securityholders for the purposes of
determining whether Securityholders of the requisite proportion of
outstanding Securities have authorized or agreed or consented to such
request, demand, authorization, direction, notice, consent, waiver or other
action, and for that purpose the outstanding Securities shall be computed as
of the record date; provided, however, that no such authorization, agreement
or consent by such Securityholders on the record date shall be deemed
effective unless it shall become effective pursuant to the provisions of this
Indenture not later than six months after the record date.
SECTION 7.02. Proof of Execution by Securityholders.
Subject to the provisions of Section 6.01, 6.02 and 8.05, proof of
the execution of any instrument by a Securityholder or his agent or proxy
shall be sufficient if made in accordance with such reasonable rules and
regulations as may be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee. The ownership of Securities shall be proved by
the Security Register or by a certificate of the Security registrar. The
Trustee may require such additional proof of any matter referred to in this
Section as it shall deem necessary.
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The record of any Securityholders' meeting shall be proved in the
manner provided in Section 8.06.
SECTION 7.03. Who Are Deemed Absolute Owners.
Prior to due presentment for registration of transfer of any
Security, the Company, the Trustee, any Authenticating Agent, any paying
agent, any transfer agent and any Security registrar may deem the person in
whose name such Security shall be registered upon the Security Register to
be, and may treat him as, the absolute owner of such Security (whether or not
such Security shall be overdue) for the purpose of receiving payment of or on
account of the principal of and premium, if any, and (subject to Section
2.06) interest on such Security and for all other purposes; and neither the
Company nor the Trustee nor any Authenticating Agent nor any paying agent nor
any transfer agent nor any Security registrar shall be affected by any notice
to the contrary. All such payments so made to any holder for the time being
or upon his order shall be valid, and, to the extent of the sum or sums so
paid, effectual to satisfy and discharge the liability for moneys payable
upon any such Security.
SECTION 7.04. Securities Owned by Company Deemed Not Outstanding.
In determining whether the holders of the requisite aggregate
principal amount of Securities have concurred in any direction, consent or
waiver under this Indenture, Securities which are owned by the Company or any
other obligor on the Securities or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Company or any other obligor on the Securities shall be disregarded and
deemed not to be outstanding for the purpose of any such determination;
provided that for the purposes of determining whether the Trustee shall be
protected in relying on any such direction, consent or waiver, only
Securities which a Responsible Officer of the Trustee actually knows are so
owned shall be so disregarded. Securities so owned which have been pledged
in good faith may be regarded as outstanding for the purposes of this Section
7.04 if the pledgee shall establish to the satisfaction of the Trustee the
pledgee's right to vote such Securities and that the pledgee is not the
Company or any such other obligor or Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Company or any such other obligor. In the case of a dispute as to such
right, any decision by the Trustee taken upon the advice of counsel shall be
full protection to the Trustee.
SECTION 7.05. Revocation of Consents; Future Holders Bound.
At any time prior to (but not after) the evidencing to the Trustee,
as provided in Section 7.01, of the taking of any action by the holders of
the percentage in aggregate principal amount of the Securities specified in
this Indenture in connection with such action, any holder of a Security (or
any Security issued in whole or in part in exchange or
47
substitution therefor), subject to Section 7.01, the serial number of which
is shown by the evidence to be included in the Securities the holders of
which have consented to such action may, by filing written notice with the
Trustee at its principal office and upon proof of holding as provided in
Section 7.02, revoke such action so far as concerns such Security (or so far
as concerns the principal amount represented by any exchanged or substituted
Security). Except as aforesaid any such action taken by the holder of any
Security shall be conclusive and binding upon such holder and upon all future
holders and owners of such Security, and of any Security issued in exchange
or substitution therefor, irrespective of whether or not any notation in
regard thereto is made upon such Security or any Security issued in exchange
or substitution therefor.
ARTICLE VIII
SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes of Meetings.
A meeting of Securityholders may be called at any time and from time
to time pursuant to the provisions of this Article VIII for any of the
following purposes:
(a) to give any notice to the Company or to the Trustee, or to give
any directions to the Trustee, or to consent to the waiving of any
default hereunder and its consequences, or to take any other
action authorized to be taken by Securityholders pursuant to any
of the provisions of Article V;
(b) to remove the Trustee and nominate a successor trustee pursuant
to the provisions of Article VI;
(c) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 9.02; or
(d) to take any other action authorized to be taken by or on behalf
of the holders of any specified aggregate principal amount of such
Securities under any other provision of this Indenture or under
applicable law.
SECTION 8.02. Call of Meetings by Trustee.
The Trustee may at any time call a meeting of Securityholders to
take any action specified in Section 8.01, to be held at such time and at
such place in the Borough of Manhattan, The City of New York, as the Trustee
shall determine. Notice of every meeting of the Securityholders, setting
forth the time and the place of such meeting and in general terms the action
proposed to be taken at such meeting, shall be mailed to holders
48
of Securities at their addresses as they shall appear on the Securities
Register. Such notice shall be mailed not less than 20 nor more than 180 days
prior to the date fixed for the meeting.
SECTION 8.03. Call of Meetings by Company or Securityholders.
In case at any time the Company pursuant to a resolution of the
Board of Directors, or the holders of at least 10% in aggregate principal
amount of the Securities then outstanding, shall have requested the Trustee
to call a meeting of Securityholders, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have mailed the notice of such meeting within 20 days after
receipt of such request, then the Company or such Securityholders may
determine the time and the place in said Borough of Manhattan for such
meeting and may call such meeting to take any action authorized in Section
8.01, by mailing notice thereof as provided in Section 8.02.
SECTION 8.04. Qualifications for Voting.
To be entitled to vote at any meeting of Securityholders a Person
shall (a) be a holder of one or more Securities or (b) a Person appointed by
an instrument in writing as proxy by a holder of one or more Securities. The
only Persons who shall be entitled to be present or to speak at any meeting
of Securityholders shall be the Persons entitled to vote at such meeting and
their counsel and any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.
SECTION 8.05. Regulations.
Notwithstanding any other provisions of this Indenture, the Trustee
may make such reasonable regulations as it may deem advisable for any meeting
of Securityholders, in regard to proof of the holding of Securities and of
the appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates
and other evidence of the right to vote, and such other matters concerning
the conduct of the meeting as it shall think fit.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in Section 8.03, in which case the
Company or the Securityholders calling the meeting, as the case may be, shall
in like manner appoint a temporary chairman. A permanent chairman and a
permanent secretary of the meeting shall be elected by majority vote of the
meeting.
Subject to the provisions of Section 8.04, at any meeting each
holder of Securities or proxy therefor shall be entitled to one vote for each
$1,000 principal amount of Securities held or represented by him; provided,
however, that no vote shall be cast or
49
counted at any meeting in respect of any Security challenged as not
outstanding and ruled by the chairman of the meeting to be not outstanding.
The chairman of the meeting shall have no right to vote other than by virtue
of Securities held by him or instruments in writing as aforesaid duly
designating him as the person to vote on behalf of other Securityholders.
Any meeting of Securityholders duly called pursuant to the provisions of
Section 8.02 or 8.03 may be adjourned from time to time by a majority of
those present, and the meeting may be held as so adjourned without further
notice.
SECTION 8.06. Voting.
The vote upon any resolution submitted to any meeting of holders of
Securities shall be by written ballots on which shall be subscribed the
signatures of such holders or of their representatives by proxy and the
serial number or numbers of the Securities held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and
who shall make and file with the secretary of the meeting their verified
written reports in triplicate of all votes cast at the meeting. A record in
duplicate of the proceedings of each meeting of Securityholders shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more persons having knowledge of the
facts setting forth a copy of the notice of the meeting and showing that said
notice was mailed as provided in Section 8.02. The record shall show the
serial numbers of the Securities voting in favor of or against any
resolution. The record shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one of the duplicates
shall be delivered to the Company and the other to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots
voted at the meeting. The holders of the Series A Capital Securities and the
Series B Capital Securities shall vote for all purposes as a single class.
Any record so signed and verified shall be conclusive evidence of
the matters therein stated.
ARTICLE IX
AMENDMENTS
SECTION 9.01. Without Consent of Securityholders.
The Company, when authorized by a Board Resolution, and the Trustee
may from time to time and at any time amend the Indenture, without the
consent of the Securityholders, for one or more of the following purposes:
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(a) to evidence the succession of another Person to the Company, or
successive successions, and the assumption by the successor Person
of the covenants, agreements and obligations of the Company
pursuant to Article X hereof;
(b) to add to the covenants of the Company such further covenants,
restrictions or conditions for the protection of the
Securityholders as the Board of Directors and the Trustee shall
consider to be for the protection of the Securityholders, and to
make the occurrence, or the occurrence and continuance, of a
default in any of such additional covenants, restrictions or
conditions a default or an Event of Default permitting the
enforcement of all or any of the remedies provided in this
Indenture as herein set forth; provided, however, that in respect
of any such additional covenant, restriction or condition such
amendment may provide for a particular period of grace after
default (which period may be shorter or longer than that allowed
in the case of other defaults) or may provide for an immediate
enforcement upon such default or may limit the remedies available
to the Trustee upon such default;
(c) to provide for the issuance under this Indenture of Securities in
coupon form (including Securities registrable as to principal
only) and to provide for exchangeability of such Securities with
the Securities issued hereunder in fully registered form and to
make all appropriate changes for such purpose;
(d) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be
defective or inconsistent with any other provision contained
herein or in any supplemental indenture, or to make such other
provisions in regard to matters or questions arising under this
Indenture; provided that any such action shall not materially
adversely affect the interests of the holders of the Securities;
(e) to evidence and provide for the acceptance of appointment
hereunder by a successor trustee with respect to the Securities;
(f) to make provision for transfer procedures, certification,
book-entry provisions, the form of restricted securities legends,
if any, to be placed on Securities, and all other matters required
pursuant to Section 2.07 or otherwise necessary, desirable or
appropriate in connection with the issuance of Securities to
holders of Capital Securities in the event of a distribution of
Securities by Progress Capital Trust following a Dissolution
Event;
51
(g) to qualify or maintain qualification of this Indenture under the
Trust Indenture Act;
(h) to enable the Company and the Trust to conduct an Exchange Offer
as contemplated by the Registration Rights Agreement, provided
that any such action shall not materially adversely affect the
interests of the holders of the Securities; or
(i) to make any change that does not adversely affect the rights of
any Securityholder in any material respect.
The Trustee is hereby authorized to join with the Company in the
execution of any supplemental indenture to effect such amendment, to make any
further appropriate agreements and stipulations which may be therein
contained and to accept the conveyance, transfer and assignment of any
property thereunder, but the Trustee shall not be obligated to, but may in
its discretion, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
Any amendment to the Indenture authorized by the provisions of this
Section 9.01 may be executed by the Company and the Trustee without the
consent of the holders of any of the Securities at the time outstanding,
notwithstanding any of the provisions of Section 9.02.
SECTION 9.02. With Consent of Securityholders.
With the consent (evidenced as provided in Section 7.01) of the
holders of a majority in aggregate principal amount of the Securities at the
time outstanding, the Company, when authorized by a Board Resolution, and the
Trustee may from time to time and at any time amend the Indenture 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 Securities; provided, however, that no such
amendment shall without the consent of the holders of each Security then
outstanding and affected thereby (i) change the Maturity Date of any
Security, or reduce the rate or extend the time of payment of interest
thereon (except as contemplated by Article XVI), or reduce the principal
amount thereof, or reduce any amount payable on redemption thereof, or make
the principal thereof or any interest or premium thereon payable in any coin
or currency other than that provided in the Securities, or impair or affect
the right of any Securityholder to institute suit for payment thereof, or
(ii) reduce the aforesaid percentage of Securities the holders of which are
required to consent to any such amendment to the Indenture, provided,
however, that if the Securities are held by Progress Capital Trust, such
amendment shall not be effective until the holders of a majority in
liquidation amount of Trust Securities shall have consented to such
amendment; provided, further, that if the consent of the holder of each
outstanding Security is required, such amendment shall not be effective until
each holder of the Trust Securities shall have consented to such amendment.
52
Upon the request of the Company accompanied by a copy of a
resolution of the Board of Directors certified by its Secretary or Assistant
Secretary authorizing the execution of any supplemental indenture affecting
such amendment, and upon the filing with the Trustee of evidence of the
consent of Securityholders as aforesaid, the Trustee shall join with the
Company in the execution of such supplemental indenture unless such
supplemental indenture affects the Trustee's own rights, duties or immunities
under this Indenture or otherwise, in which case the Trustee may in its
discretion, but shall not be obligated to, enter into such supplemental
indenture.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the
Trustee shall transmit by mail, first class postage prepaid, a notice,
prepared by the Company, setting forth in general terms the substance of such
supplemental indenture, to the Securityholders as their names and addresses
appear upon the Security Register. Any failure of the Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture.
It shall not be necessary for the consent of the Securityholders
under this Section 9.02 to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such consent shall
approve the substance thereof.
SECTION 9.03. Compliance with Trust Indenture Act; Effect of
Supplemental Indentures.
Any supplemental indenture executed pursuant to the provisions of
this Article IX shall comply with the Trust Indenture Act. Upon the
execution of any supplemental indenture pursuant to the provisions of this
Article IX, this Indenture shall be and be deemed to be modified and amended
in accordance therewith and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of the Trustee, the
Company and the holders of Securities shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such
modifications and amendments and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
SECTION 9.04. Notation on Securities.
Securities authenticated and delivered after the execution of any
supplemental indenture affecting such series pursuant to the provisions of
this Article IX may bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental indenture. If the Company or the
Trustee shall so determine, new Securities so modified as to conform, in the
opinion of the Trustee and the Board of Directors, to any modification of
this Indenture contained in any such supplemental indenture may be prepared
and executed by the Company, authenticated by the Trustee or the
Authenticating Agent and delivered in exchange for the Securities then
outstanding.
53
SECTION 9.05. Evidence of Compliance of Supplemental Indenture to be
Furnished Trustee.
The Trustee, subject to the provisions of Sections 6.01 and 6.02,
may receive, in addition to the document required by Section 13.06, an
Officers' Certificate and an Opinion of Counsel as conclusive evidence that
any supplemental indenture executed pursuant hereto complies with the
requirements of this Article IX. The Trustee may received an Opinion of
Counsel as conclusive evidence that any supplemental indenture executed
pursuant to this Article is authorized or permitted by, and conforms to, the
terms of this Article and that it is proper for the Trustee under the
provisions of this Article to join in the execution thereof.
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 10.01. Company May Consolidate, etc., on Certain Terms.
Nothing contained in this Indenture or in any of the Securities
shall prevent any consolidation or merger of the Company with or into any
other Person (whether or not affiliated with the Company, as the case may
be), or successive consolidations or mergers in which the Company or its
successor or successors, as the case may be, shall be a party or parties, or
shall prevent any sale, conveyance, transfer or lease of the property of the
Company, or its successor or successors as the case may be, as an entirety,
or substantially as an entirety, to any other Person (whether or not
affiliated with the Company, or its successor or successors, as the case may
be) authorized to acquire and operate the same; provided, that (a) the
Company is the surviving Person, or the Person formed by or surviving any
such consolidation or merger (if other than the Company) or to which such
sale, conveyance, transfer or lease of property is made is a Person organized
and existing under the laws of the United States or any State thereof or the
District of Columbia, and (b) upon any such consolidation, merger, sale,
conveyance, transfer or lease, the due and punctual payment of the principal
of (and premium, if any) and interest on the Securities according to their
tenor and the due and punctual performance and observance of all the
covenants and conditions of this Indenture to be kept or performed by the
Company shall be expressly assumed, by supplemental indenture (which shall
conform to the provisions of the Trust Indenture Act, as then in effect)
satisfactory in form to the Trustee executed and delivered to the Trustee by
the Person formed by such consolidation, or into which the Company shall have
been merged, or by the Person which shall have acquired such property, as the
case may be, (c) after giving effect to such consolidation, merger, sale,
conveyance, transfer or lease, no Default or Event of Default shall have
occurred and be continuing and (d) such consolidation, merger, sale,
conveyance, transfer or lease does not cause the Securities to be downgraded
by a nationally recognized statistical rating organization.
54
SECTION 10.02. Successor Corporation to be Substituted for Company.
In case of any such consolidation, merger, conveyance or transfer
and upon the assumption by the successor corporation, by supplemental
indenture, executed and delivered to the Trustee and satisfactory in form to
the Trustee, of the due and punctual payment of the principal of and premium,
if any, and interest on all of the Securities and the due and punctual
performance and observance of all of the covenants and conditions of this
Indenture to be performed or observed by the Company, such successor Person
shall succeed to and be substituted for the Company, with the same effect as
if it had been named herein as the party of the first part, and the Company
thereupon shall be relieved of any further liability or obligation hereunder
or upon the Securities. Such successor Person thereupon may cause to be
signed, and may issue either in its own name or in the name of Progress
Financial Corporation, any or all of the Securities issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Trustee or the Authenticating Agent; and, upon the order of such successor
Person instead of the Company and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee or the Authenticating
Agent shall authenticate and deliver any Securities which previously shall
have been signed and delivered by the officers of the Company to the Trustee
or the Authenticating Agent for authentication, and any Securities which such
successor Person thereafter shall cause to be signed and delivered to the
Trustee or the Authenticating Agent for that purpose. All the Securities so
issued shall in all respects have the same legal rank and benefit under this
Indenture as the Securities theretofore or thereafter issued in accordance
with the terms of this Indenture as though all of such Indentures had been
issued at the date of the execution hereof.
SECTION 10.03. Opinion of Counsel to be Given Trustee.
The Trustee, subject to the provisions of Sections 6.01 and 6.02,
may receive an Opinion of Counsel as conclusive evidence that any
consolidation, merger, sale, conveyance, transfer or lease, and any
assumption, permitted or required by the terms of this Article X complies
with the provisions of this Article X.
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.01. Discharge of Indenture.
When (a) the Company shall deliver to the Trustee for cancellation
all Securities theretofore authenticated (other than any Securities which
shall have been destroyed, lost or stolen and which shall have been replaced
as provided in Section 2.08) and not theretofore cancelled, or (b) all the
Securities not theretofore cancelled or delivered to the Trustee for
cancellation shall have become due and payable, or are by their terms to
55
become due and payable within one year or are to be called for redemption
within one year under arrangements satisfactory to the Trustee for the giving
of notice of redemption, and the Company shall deposit with the Trustee, in
trust, funds sufficient to pay on the Maturity Date or upon redemption all of
the Securities (other than any Securities which shall have been destroyed,
lost or stolen and which shall have been replaced as provided in Section
2.08) not theretofore cancelled or delivered to the Trustee for cancellation,
including principal and premium, if any, and interest (including Compounded
Interest and Additional Sums, if any) and Liquidated Damages, if any, due or
to become due to the Maturity Date or redemption date, as the case may be,
but excluding, however, the amount of any moneys for the payment of principal
of or premium, if any, or interest (including Compounded Interest and
Additional Sums, if any) or Liquidated Damages, if any, on the Securities (1)
theretofore repaid to the Company in accordance with the provisions of
Section 11.04, or (2) paid to any State or to the District of Columbia
pursuant to its unclaimed property or similar laws, and if in either case the
Company shall also pay or cause to be paid all other sums payable hereunder
by the Company, then this Indenture shall cease to be of further effect
except for the provisions of Sections 2.02, 2.07, 2.08, 3.01, 3.02, 3.04,
6.06, 6.10 and 11.04 hereof, which shall survive until such Securities shall
mature and be paid. Thereafter, Sections 6.06, 6.10 and 11.04 shall survive,
and the Trustee, on demand of the Company accompanied by any Officers'
Certificate and an Opinion of Counsel and at the cost and expense of the
Company, shall execute proper instruments acknowledging satisfaction of and
discharging this Indenture, the Company, however, hereby agreeing to
reimburse the Trustee for any costs or expenses thereafter reasonably and
properly incurred by the Trustee in connection with this Indenture or the
Securities.
SECTION 11.02. Deposited Moneys and U.S. Government Obligations to be
Held in Trust by Trustee.
Subject to the provisions of Section 11.04, all moneys and U.S.
Government Obligations deposited with the Trustee pursuant to Sections 11.01
or 11.05 shall be held in trust and applied by it to the payment, either
directly or through any paying agent (including the Company if acting as its
own paying agent), to the holders of the particular Securities for the
payment of which such moneys or U.S. Government Obligations have been
deposited with the Trustee, of all sums due and to become due thereon for
principal, premium, if any, and interest.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 11.05 or the principal and interest
received in respect thereof other than any such tax, fee or other charge
which by law is for the account of the holders of outstanding Securities.
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SECTION 11.03. Paying Agent to Repay Moneys Held.
Upon the satisfaction and discharge of this Indenture all moneys
then held by any paying agent of the Securities (other than the Trustee)
shall, upon written demand of the Company, be repaid to it or paid to the
Trustee, and thereupon such paying agent shall be released from all further
liability with respect to such moneys.
SECTION 11.04. Return of Unclaimed Moneys.
Any moneys deposited with or paid to the Trustee or any paying agent
for payment of the principal of or premium, if any, or interest on Securities
and not applied but remaining unclaimed by the holders of Securities for two
years after the date upon which the principal of or premium, if any, or
interest (including Compounded Interest and Additional Sums, if any) or
Liquidated Damages, if any, on such Securities, as the case may be, shall
have become due and payable, shall be repaid to the Company by the Trustee or
such paying agent on written demand; and the holder of any of the Securities
shall thereafter look only to the Company for any payment which such holder
may be entitled to collect and all liability of the Trustee or such paying
agent with respect to such moneys shall thereupon cease.
SECTION 11.05. Defeasance Upon Deposit of Moneys or U.S. Government
Obligations.
The Company shall be deemed to have been Discharged (as defined
below) from its obligations with respect to the Securities on the 91st day
after the applicable conditions set forth below have been satisfied:
(1) the Company shall have deposited or caused to be deposited
irrevocably with the Trustee or the Defeasance Agent (as defined
below) as trust funds in trust, specifically pledged as security
for, and dedicated solely to, the benefit of the holders of the
Securities (i) money in an amount, or (ii) U.S. Government
Obligations which through the payment of interest and principal
in respect thereof in accordance with their terms will provide,
not later than one day before the due date of any payment, money
in an amount, or (iii) a combination of (i) and (ii), sufficient,
in the opinion (with respect to (ii) and (iii)) of a nationally
recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee and the
Defeasance Agent, if any, to pay and discharge each installment of
principal of and interest and premium, if any, on the outstanding
Securities on the dates such installments of principal, interest
or premium are due;
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(2) if the Securities are then listed on any national securities
exchange, the Company shall have delivered to the Trustee and
the Defeasance Agent, if any, an Opinion of Counsel to the effect
that the exercise of the option under this Section 11.05 would
not cause such Securities to be delisted from such exchange;
(3) no Default or Event of Default with respect to the Securities
shall have occurred and be continuing on the date of such deposit;
and
(4) the Company shall have delivered to the Trustee and the Defeasance
Agent, if any, an Opinion of Counsel to the effect that holders
of the Securities will not recognize income, gain or loss for
United States federal income tax purposes as a result of the
exercise of the option under this Section 11.05 and will be
subject to United States federal income tax on the same amount and
in the same manner and at the same times as would have been the
case if such option had not been exercised, and such opinion shall
be based on a statute so providing or be accompanied by a private
letter ruling to that effect received from the United States
Internal Revenue Service or a revenue ruling pertaining to a
comparable form of transaction to that effect published by the
United States Internal Revenue Service.
"Discharged" means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by, and obligations under, the
Securities and to have satisfied all the obligations under this Indenture
relating to the Securities (and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging the same), except (A) the
rights of holders of Securities to receive, from the trust fund described in
clause (1) above, payment of the principal of and the interest and premium,
if any, on the Securities when such payments are due; (B) the Company's
obligations with respect to the Securities under Sections 2.07, 2.08, 5.02
and 11.04; and (C) the rights, powers, trusts, duties and immunities of the
Trustee hereunder.
"Defeasance Agent" means another financial institution which is
eligible to act as Trustee hereunder and which assumes all of the obligations
of the Trustee necessary to enable the Trustee to act hereunder. In the
event such a Defeasance Agent is appointed pursuant to this Section, the
following conditions shall apply:
(1) The Trustee shall have approval rights over the document
appointing such Defeasance Agent and the document setting forth
such Defeasance Agent's rights and responsibilities;
(2) The Defeasance Agent shall provide verification to the Trustee
acknowledging receipt of sufficient money and/or U. S. Government
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Obligations to meet the applicable conditions set forth in this
Section 11.05.
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 12.01. Indenture and Securities Solely Corporate Obligations.
No recourse for the payment of the principal of or premium, if any,
or interest on any Security, or for any claim based thereon or otherwise in
respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in this Indenture, or in any Security, or because of
the creation of any indebtedness represented thereby, shall be had against
any incorporator, stockholder, officer or director, as such, past, present or
future, of the Company or of any successor Person to the Company, either
directly or through the Company or any successor Person to 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 all such liability is hereby expressly waived and released as
a condition of, and as a consideration for, the execution of this Indenture
and the issue of the Securities.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors.
All the covenants, stipulations, promises and agreements in this
Indenture contained by the Company shall bind its successors and assigns
whether so expressed or not.
SECTION 13.02. Official Acts by Successor Corporation.
Any act or proceeding by any provision of this Indenture authorized
or required to be done or performed by any board, committee or officer of the
Company shall and may be done and performed with like force and effect by the
like board, committee or officer of any corporation that shall at the time be
the lawful sole successor of the Company.
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SECTION 13.03. Surrender of Company Powers.
The Company by instrument in writing executed by authority of 2/3
(two-thirds) of its Board of Directors and delivered to the Trustee may
surrender any of the powers reserved to the Company, and thereupon such power
so surrendered shall terminate both as to the Company, as the case may be,
and as to any successor Person.
SECTION 13.04. Addresses for Notices, etc.
Any notice or demand which by any provision of this Indenture is
required or permitted to be given or served by the Trustee or by the holders
of Securities on the Company may be given or served by being deposited
postage prepaid by first class mail, registered or certified mail, overnight
courier service or conformed telecopy addressed (until another address is
filed by the Company with the Trustee for the purpose) to the Company at Four
Xxxxxx Xxxxxxx, Xxxxx 000, Xxxx Xxxx, Xxxxxxxxxxxx 00000, Attention:
Xxxxxxxxx X. Xxxxx, Senior Vice President and Chief Financial Officer. Any
notice, direction, request or demand by any Securityholder to or upon the
Trustee shall be deemed to have been sufficiently given or made, for all
purposes, if given or made in writing at the office of the Trustee, 000
Xxxxxxx Xxxxxx, 00xx Xxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Corporate Trust, Trustee Administration (unless another address is provided
by the Trustee to the Company for such purpose). Any notice or communication
to a Securityholder shall be mailed by first class mail to his or her address
shown on the register kept by the Security Registrar. Failure to mail a
notice or communication to a Securityholder or any defect in it shall not
affect its sufficiency with respect to other Securityholders.
SECTION 13.05. Governing Law.
This Indenture and each Security shall be deemed to be a contract
made under the laws of the State of New York, and for all purposes shall be
governed by and construed in accordance with the laws of said State, without
regard to conflicts of laws principles thereof.
SECTION 13.06. Evidence of Compliance with Conditions Precedent.
Upon any application or demand by the Company to the Trustee to take
any action under any of the provisions of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that in the opinion
of the signers all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with and an
Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or
covenant provided for in this Indenture (except certificates delivered
pursuant to Section 3.05) shall include (1) a statement
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that the Person making such certificate or opinion has read such covenant or
condition; (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; (3) a statement that, in the
opinion of such Person, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or not
such covenant or condition has been complied with; and (4) a statement as to
whether or not, in the opinion of such person, such condition or covenant has
been complied with.
SECTION 13.07. Business Days.
In any case where the date of payment of principal of or premium, if
any, or interest on the Securities will not be a Business Day, the payment of
such principal of or premium, if any, or interest on the Securities 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 and no
interest shall accrue for the period from and after such date, except that if
such next succeeding Business Day falls in the next succeeding calendar year,
then such payment shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such date.
SECTION 13.08. Trust Indenture Act to Control.
If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act of 1939, such imposed duties shall
control.
SECTION 13.09. Table of Contents, Headings, etc.
The table of contents and the titles and headings of the articles
and sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 13.10. Execution in Counterparts.
This Indenture may be executed in any number of counterparts, each
of which shall be an original, but such counterparts shall together
constitute but one and the same instrument.
SECTION 13.11. Separability.
In case any one or more of the provisions contained in this
Indenture or in the Securities shall for any reason be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of
61
this Indenture or of the Securities, but this Indenture and the Securities
shall be construed as if such invalid or illegal or unenforceable provision
had never been contained herein or therein.
SECTION 13.12. Assignment.
The Company will have the right at all times to assign any of its
respective rights or obligations under this Indenture to a direct or indirect
wholly owned Subsidiary of the Company, provided that, in the event of any
such assignment, the Company will remain primarily liable for all such
obligations. Subject to the foregoing, the Indenture is binding upon and
inures to the benefit of the parties thereto and their respective successors
and assigns. This Indenture may not otherwise be assigned by the parties
thereto.
SECTION 13.13. Acknowledgement of Rights.
The Company acknowledges that, with respect to any Securities held
by Progress Capital Trust or a trustee of such trust, if the Property Trustee
of such Trust fails to enforce its rights under this Indenture as the holder
of the Securities held as the assets of Progress Capital Trust any holder of
Capital Securities may institute legal proceedings directly against the
Company to enforce such Property Trustee's rights under this Indenture
without first instituting any legal proceedings against such Property Trustee
or any other person or entity. Notwithstanding the foregoing, if an Event of
Default has occurred and is continuing and such event is attributable to the
failure of the Company to pay principal of or premium, if any, or interest on
the Securities when due, the Company acknowledges that a holder of Capital
Securities may directly institute a proceeding for enforcement of payment to
such holder of the principal of or premium, if any, or interest on the
Securities having a principal amount equal to the aggregate liquidation
amount of the Capital Securities of such holder on or after the respective
due date specified in the Securities.
ARTICLE XIV
REDEMPTION OF SECURITIES -- MANDATORY AND
OPTIONAL SINKING FUND
SECTION 14.01. Special Event Redemption.
If, prior to the Initial Optional Redemption Date, a Special Event
has occurred and is continuing then, notwithstanding Section 14.02(a) but
subject to Section 14.02(c), the Company shall have the right, at any time
within 90 days following the occurrence of such Special Event and prior to
the Initial Optional Redemption Date, upon (i) not less than 45 days written
notice to the Trustee and (ii) not less than 30 days nor more than 60 days
written notice to the Securityholders, to redeem the Securities, in whole
(but not in part), at the Special Event Redemption Price. Following a
Special Event, the Company
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shall take such action as is necessary to promptly determine the Special
Event Redemption Price, including without limitation the appointment by the
Company of a Quotation Agent. The Special Event Redemption Price shall be
paid prior to 12:00 noon, New York time, on the date of such redemption or
such earlier time as the Company determines, provided that the Company shall
deposit with the Trustee an amount sufficient to pay the Special Event
Redemption Price by 10:00 a.m., New York time, on the date such Special Event
Redemption Price is to be paid. The Company shall provide the Trustee with
written notice of the Special Event Redemption Price promptly after the
calculation thereof, which notice shall include any calculation made by the
Quotation Agent in connection with the determination of the Special Event
Redemption Price.
SECTION 14.02. Optional Redemption by Company.
(a) Subject to the provisions of this Article XIV, the Company shall
have the right to redeem the Securities, in whole or in part, from time to time,
on or after the Initial Optional Redemption Date, at the redemption prices set
forth below (expressed as percentages of principal) plus, in each case, accrued
and unpaid interest thereon (including Compounded Interest and Additional Sums,
if any) and Liquidated Damages, if any, to the applicable date of redemption
(the "Optional Redemption Price") if redeemed during the 12-month period
beginning June 1, of the years indicated below.
Year Percentage
2007 105.250%
2008 104.725%
2009 104.200%
2010 103.675%
2011 103.150%
2012 102.625%
2013 102.100%
2014 101.575%
2015 101.050%
2016 100.525%
2017 and thereafter 100.000%
If the Securities are only partially redeemed pursuant to this
Section 14.02, the Securities to be redeemed shall be selected on a pro rata
basis, by lot or other method utilized by the Trustee, not more than 60 days
prior to the date fixed for redemption from
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the outstanding Securities not previously called for redemption, provided,
however, that with respect to Securityholders that would be required to hold
Securities with an aggregate principal amount of less than $100,000 but more
than an aggregate principal amount of zero as a result of such pro rata
redemption, the Company shall redeem Securities of each such Securityholder
so that after such redemption such Securityholder shall hold Securities
either with an aggregate principal amount of at least $100,000 or such
Securityholder no longer holds any Securities and shall use such method
(including, without limitation, by lot) as the Company shall deem fair and
appropriate, provided, further, that any such method of selection may be made
on the basis of the aggregate principal amount of Securities held by each
Securityholder and may be made by making such adjustments as the Company
deems fair and appropriate in order that only Securities in denominations of
$1,000 or integral multiples thereof shall be redeemed. The Optional
Redemption Price shall be paid prior to 12:00 noon, New York time, on the
date of such redemption or at such earlier time as the Company determines,
provided that the Company shall deposit with the Trustee an amount sufficient
to pay the Optional Redemption Price by 10:00 a.m., New York time, on the
date such Optional Redemption Price is to be paid.
(b) Notwithstanding the first sentence of Section 14.02, upon the
entry of an order for dissolution of Progress Capital Trust by a court of
competent jurisdiction, the Securities thereafter will be subject to optional
redemption, in whole only, but not in part, on or after June 1, 2007, at the
optional redemption prices set forth in Section 14.02 and otherwise in
accordance with this Article XIV.
(c) Any redemption of Securities pursuant to Section 14.01 or
Section 14.02 shall be subject to the receipt by the Company of any required
regulatory approval.
SECTION 14.03. No Sinking Fund.
The Securities are not entitled to the benefit of any sinking fund.
SECTION 14.04. Notice of Redemption; Selection of Securities.
In case the Company shall desire to exercise the right to redeem
all, or, as the case may be, any part of the Securities in accordance with
their terms, it shall fix a date for redemption and shall mail a notice of
such redemption at least 30 and not more than 60 days prior to the date fixed
for redemption to the holders of Securities so to be redeemed as a whole or
in part at their last addresses as the same appear on the Security Register.
Such mailing shall be by first class mail. The notice if mailed in the manner
herein provided shall be conclusively presumed to have been duly given,
whether or not the holder receives such notice. In any case, failure to give
such notice by mail or any defect in the notice to the holder of any Security
designated for redemption as a whole or in part shall not affect the validity
of the proceedings for the redemption of any other Security.
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Each such notice of redemption shall specify the CUSIP number of the
Securities to be redeemed, the date fixed for redemption, the redemption
price at which the Securities are to be redeemed (or the method by which such
redemption price is to be calculated), the place or places of payment that
payment will be made upon presentation and surrender of the Securities, that
interest accrued to the date fixed for redemption will be paid as specified
in said notice, and that on and after said date interest thereon or on the
portions thereof to be redeemed will cease to accrue. If less than all the
Securities are to be redeemed the notice of redemption shall specify the
numbers of the Securities to be redeemed. In case any Security is to be
redeemed in part only, the notice of redemption shall state the portion of
the principal amount thereof to be redeemed and shall state that on and after
the date fixed for redemption, upon surrender of such Security, a new
Security or Securities in principal amount equal to the unredeemed portion
thereof will be issued.
By 10:00 a.m. New York time on the redemption date specified in the
notice of redemption given as provided in this Section, the Company will
deposit with the Trustee or with one or more paying agents an amount of money
sufficient to redeem on the redemption date all the Securities so called for
redemption at the appropriate Redemption Price, together with accrued
interest to the date fixed for redemption.
The Company will give the Trustee notice not less than 45 days prior
to the redemption date as to the aggregate principal amount of Securities to
be redeemed and the Trustee shall select, in such manner as in its sole
discretion it shall deem appropriate and fair, the Securities or portions
thereof (in integral multiples of $1,000, except as otherwise set forth in
the applicable form of Security) to be redeemed.
SECTION 14.05. Payment of Securities Called for Redemption.
If notice of redemption has been given as provided in Section 14.04,
the Securities or portions of Securities with respect to which such notice
has been given shall become due and payable on the date and at the place or
places stated in such notice at the applicable Redemption Price, together
with interest accrued to the date fixed for redemption (subject to the rights
of holders of Securities on the close of business on a regular record date in
respect of an Interest Payment Date occurring on or prior to the redemption
date), and on and after said date (unless the Company shall default in the
payment of such Securities at the Redemption Price, together with interest
accrued to said date) interest (including Compounded Interest and Additional
Sums, if any) and Liquidated Damages, if any, on the Securities or portions
of Securities so called for redemption shall cease to accrue. On
presentation and surrender of such Securities at a place of payment specified
in said notice, the said Securities or the specified portions thereof shall
be paid and redeemed by the Company at the applicable Redemption Price,
together with interest (including Compounded Interest and Additional Sums, if
any) and Liquidated Damages, if any, accrued thereon to the date fixed for
redemption (subject to the rights of holders of Securities on the close of
business on a regular record date in respect of an Interest Payment Date
occurring on or prior to the redemption date).
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Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and make available for
delivery to the holder thereof, at the expense of the Company, a new Security
or Securities of authorized denominations, in principal amount equal to the
unredeemed portion of the Security so presented.
ARTICLE XV
SUBORDINATION OF SECURITIES
SECTION 15.01. Agreement to Subordinate.
The Company covenants and agrees, and each holder of Securities
issued hereunder likewise covenants and agrees, that the Securities shall be
issued subject to the provisions of this Article XV; and each holder of a
Security, whether upon original issue or upon transfer or assignment thereof,
accepts and agrees to be bound by such provisions.
The payment by the Company of the principal of, premium, if any, and
interest (including Compounded Interest and Additional Sums, if any) and
Liquidated Damages, if any, on all Securities issued hereunder shall, to the
extent and in the manner hereinafter set forth, be subordinated and junior in
right of payment to all Senior Indebtedness, whether outstanding at the date
of this Indenture or thereafter incurred.
No provision of this Article XV shall prevent the occurrence of any
Default or Event of Default hereunder.
SECTION 15.02. Default on Senior Indebtedness.
In the event and during the continuation of any default by the
Company in the payment of principal, premium, interest or any other payment
due on any Senior Indebtedness, or in the event that the maturity of any
Senior Indebtedness has been accelerated because of a default, then, in
either case, no payment shall be made by the Company with respect to the
principal (including redemption payments) of or premium, if any, or interest
on the Securities.
In the event of the acceleration of the maturity of the Securities,
then no payment shall be made by the Company with respect to the principal
(including redemption payments) of or premium, if any, or interest on the
Securities until the holders of all Senior Indebtedness outstanding at the
time of such acceleration shall receive payment in full of such Senior
Indebtedness (including any amounts due upon acceleration).
In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee when such payment is prohibited by the preceding
paragraphs of this Section
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15.02, such payment shall be held in trust for the benefit of, and shall be
paid over or delivered to, the holders of Senior Indebtedness or their
respective representatives, or to the trustee or trustees under any indenture
pursuant to which any of such Senior Indebtedness may have been issued, as
their respective interests may appear, but only to the extent that the
holders of the Senior Indebtedness (or their representative or
representatives or a trustee) notify the Trustee in writing, within 90 days
of such payment of the amounts then due and owing on such Senior Indebtedness
and only the amounts specified in such notice to the Trustee shall be paid to
the holders of such Senior Indebtedness.
SECTION 15.03. Liquidation; Dissolution; Bankruptcy.
Upon any payment by the Company or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution or winding-up or liquidation or reorganization
of the Company, whether voluntary or involuntary or in bankruptcy,
insolvency, receivership or other proceedings, all Senior Indebtedness of the
Company shall first be paid in full, or payment thereof provided for in money
in accordance with its terms, before any payment is made by the Company on
account of the principal (and premium, if any) or interest (including
Compounded Interest and Additional Sums, if any) and Liquidated Damages, if
any, on the Securities; and upon any such dissolution or winding-up or
liquidation or reorganization, any payment by the Company, or distribution of
assets of the Company of any kind or character, whether in cash, property or
securities, to which the Securityholders or the Trustee would be entitled to
receive from the Company, except for the provisions of this Article XV, shall
be paid by the Company or by any receiver, trustee in bankruptcy, liquidating
trustee, agent or other Person making such payment or distribution, or by the
Securityholders or by the Trustee under the Indenture if received by them or
it, directly to the holders of Senior Indebtedness of the Company (pro rata
to such holders on the basis of the respective amounts of Senior Indebtedness
held by such holders, as calculated by the Company) or their representative
or representatives, or to the trustee or trustees under any indenture
pursuant to which any instruments evidencing such Senior Indebtedness may
have been issued, as their respective interests may appear, to the extent
necessary to pay all such Senior Indebtedness in full, in money or money's
worth, after giving effect to any concurrent payment or distribution to or
for the holders of such Senior Indebtedness, before any payment or
distribution is made to the Securityholders or to the Trustee.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, prohibited by the foregoing, shall be received
by the Trustee before all Senior Indebtedness is paid in full, or provision
is made for such payment in money in accordance with its terms, such payment
or distribution shall be held in trust for the benefit of and shall be paid
over or delivered to the holders of such Senior Indebtedness or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing such Senior
Indebtedness may have been issued, as their respective interests may appear,
as calculated by the Company, for application to the payment of all
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Senior Indebtedness remaining unpaid to the extent necessary to pay all such
Senior Indebtedness in full in money in accordance with its terms, after
giving effect to any concurrent payment or distribution to or for the benefit
of the holders of such Senior Indebtedness.
For purposes of this Article XV, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment, the
payment of which is subordinated at least to the extent provided in this
Article XV with respect to the Securities to the payment of Senior
Indebtedness that may at the time be outstanding, provided that (i) such
Senior Indebtedness is assumed by the new corporation, if any, resulting from
any such reorganization or readjustment, and (ii) the rights of the holders
of such Senior Indebtedness are not, without the consent of such holders,
altered by such reorganization or readjustment. The consolidation of the
Company with, or the merger of the Company into, another Person or the
liquidation or dissolution of the Company following the sale, conveyance,
transfer or lease of its property as an entirety, or substantially as an
entirety, to another Person upon the terms and conditions provided for in
Article X of this Indenture shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section 15.03 if such
other Person shall, as a part of such consolidation, merger, sale,
conveyance, transfer or lease, comply with the conditions stated in Article X
of this Indenture. Nothing in Section 15.02 or in this Section 15.03 shall
apply to claims of, or payments to, the Trustee under or pursuant to Section
6.06 of this Indenture.
SECTION 15.04. Subrogation.
Subject to the payment in full of all Senior Indebtedness, the
rights of the Securityholders shall be subrogated to the rights of the
holders of such Senior Indebtedness to receive payments or distributions of
cash, property or securities of the Company, as the case may be, applicable
to such Senior Indebtedness until the principal of (and premium, if any) and
interest on the Securities shall be paid in full; and, for the purposes of
such subrogation, no payments or distributions to the holders of such Senior
Indebtedness of any cash, property or securities to which the Securityholders
or the Trustee would be entitled except for the provisions of this Article
XV, and no payment over pursuant to the provisions of this Article XV to or
for the benefit of the holders of such Senior Indebtedness by Securityholders
or the Trustee, shall, as between the Company, its creditors other than
holders of Senior Indebtedness of the Company, and the holders of the
Securities, be deemed to be a payment by the Company to or on account of such
Senior Indebtedness. It is understood that the provisions of this Article XV
are and are intended solely for the purposes of defining the relative rights
of the holders of the Securities, on the one hand, and the holders of such
Senior Indebtedness on the other hand.
Nothing contained in this Article XV or elsewhere in this Indenture
or in the Securities is intended to or shall impair, as between the Company,
its creditors other than
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the holders of Senior Indebtedness of the Company, and the holders of the
Securities, the obligation of the Company, which is absolute and
unconditional, to pay to the holders of the Securities the principal of (and
premium, if any) and interest (including Compounded Interest and Additional
Sums, if any) and Liquidated Damages, if any, on the Securities as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the holders of the
Securities and creditors of the Company, as the case may be, other than the
holders of Senior Indebtedness of the Company, as the case may be, nor shall
anything herein or therein prevent the Trustee or the holder of any Security
from exercising all remedies otherwise permitted by applicable law upon
default under the Indenture, subject to the rights, if any, under this
Article XV of the holders of such Senior Indebtedness in respect of cash,
property or securities of the Company, as the case may be, received upon the
exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred
to in this Article XV, the Trustee, subject to the provisions of Article VI
of this Indenture, and the Securityholders shall be entitled to conclusively
rely upon any order or decree made by any court of competent jurisdiction in
which such dissolution, winding-up, liquidation or reorganization proceedings
are pending, or a certificate of the receiver, trustee in bankruptcy,
liquidation trustee, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Securityholders, for the
purposes of ascertaining the Persons entitled to participate in such
distribution, the holders of Senior Indebtedness and other indebtedness of
the Company, as the case may be, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article XV.
SECTION 15.05. Trustee to Effectuate Subordination.
Each Securityholder by such Securityholder's acceptance thereof
authorizes and directs the Trustee on such Securityholder's behalf to take
such action as may be necessary or appropriate to effectuate the
subordination provided in this Article XV and appoints the Trustee such
Securityholder's attorney-in-fact for any and all such purposes.
SECTION 15.06. Notice by the Company.
The Company shall give prompt written notice to a Responsible
Officer of the Trustee of any fact known to the Company that would prohibit
the making of any payment of monies to or by the Trustee in respect of the
Securities pursuant to the provisions of this Article XV. Notwithstanding
the provisions of this Article XV or any other provision of this Indenture,
the Trustee shall not be charged with knowledge of the existence of any facts
that would prohibit the making of any payment of monies to or by the Trustee
in respect of the Securities pursuant to the provisions of this Article XV,
unless and until a Responsible Officer of the Trustee shall have received
written notice thereof from the Company or a holder or holders of Senior
Indebtedness or from any trustee therefor; and before the receipt of any such
written notice, the Trustee, subject to the provisions of Article VI of this
69
Indenture, shall be entitled in all respects to assume that no such facts
exist; provided, however, that if the Trustee shall not have received the
notice provided for in this Section 15.06 at least two Business Days prior to
the date upon which by the terms hereof any money may become payable for any
purpose (including, without limitation, the payment of the principal of (or
premium, if any) or interest (including Compounded Interest and Additional
Sums, if any) and Liquidated Damages, if any, on any Security), then,
anything herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such money and to apply the same to
the purposes for which they were received, and shall not be affected by any
notice to the contrary that may be received by it within two Business Days
prior to such date.
The Trustee, subject to the provisions of Article VI of this
Indenture, shall be entitled to conclusively rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness of the Company (or a trustee on behalf of such holder), as the
case may be, to establish that such notice has been given by a holder of such
Senior Indebtedness or a trustee on behalf of any such holder or holders. In
the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of such Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article XV, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of such Senior
Indebtedness held by such Person, the extent to which such Person is entitled
to participate in such payment or distribution and any other facts pertinent
to the rights of such Person under this Article XV, 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.
Upon any payment or distribution of assets of the Company referred
to in this Article XV, the Trustee and the Securityholders shall be entitled
to rely upon any order or decree entered by any court of competent
jurisdiction in which such insolvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy, liquidating trustee,
custodian, receiver, assignee for the benefit of creditors, agent or other
person making such payment or distribution, delivered to the Trustee or to
the Securityholders, for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article XV.
SECTION 15.07. Rights of the Trustee; Holders of Senior Indebtedness.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article XV in respect of any Senior Indebtedness at
any time held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any
of its rights as such holder.
70
With respect to the holders of Senior Indebtedness of the Company,
the Trustee undertakes to perform or to observe only such of its covenants
and obligations as are specifically set forth in this Article XV, and no
implied covenants or obligations with respect to the holders of such Senior
Indebtedness shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to owe any fiduciary duty to the holders of such
Senior Indebtedness and, subject to the provisions of Article VI of this
Indenture, the Trustee shall not be liable to any holder of such Senior
Indebtedness if it shall pay over or deliver to Securityholders, the Company
or any other Person money or assets to which any holder of such Senior
Indebtedness shall be entitled by virtue of this Article XV or otherwise.
Nothing in this Article XV shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 6.06.
SECTION 15.08. Subordination May Not Be Impaired.
No right of any present or future holder of any Senior Indebtedness
of the Company to enforce subordination as herein provided shall at any time
in any way be prejudiced or impaired by any act or failure to act on the part
of the Company, as the case may be, or by any act or failure to act, in good
faith, by any such holder, or by any noncompliance by the Company, as the
case may be, with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have or
otherwise be charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness of the Company may, at any time
and from time to time, without the consent of or notice to the Trustee or the
Securityholders, without incurring responsibility to the Securityholders and
without impairing or releasing the subordination provided in this Article XV
or the obligations hereunder of the holders of the Securities to the holders
of such Senior Indebtedness, do any one or more of the following: (i) change
the manner, place or terms of payment or extend the time of payment of, or
renew or alter, such Senior Indebtedness, or otherwise amend or supplement in
any manner such Senior Indebtedness or any instrument evidencing the same or
any agreement under which such Senior Indebtedness is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing such Senior Indebtedness; (iii) release any Person liable
in any manner for the collection of such Senior Indebtedness; and (iv)
exercise or refrain from exercising any rights against the Company, as the
case may be, and any other Person.
71
ARTICLE XVI
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 16.01. Extension of Interest Payment Period.
So long as no Event of Default has occurred and is continuing, the
Company shall have the right, at any time and from time to time during the
term of the Securities, to defer payments of interest by extending the
interest payment period of such Securities for a period not exceeding 10
consecutive semi-annual periods, including the first such semi-annual period
during such extension period (the "Extended Interest Payment Period"), during
which Extended Interest Payment Period no interest shall be due and payable;
provided that no Extended Interest Payment Period shall end on a date other
than an Interest Payment Date or extend beyond the Maturity Date. To the
extent permitted by applicable law, interest, the payment of which has been
deferred because of the extension of the interest payment period pursuant to
this Section 16.01, will bear interest thereon at the Coupon Rate compounded
semi-annually for each semi-annual period of the Extended Interest Payment
Period ("Compounded Interest"). At the end of the Extended Interest Payment
Period, the Company shall pay all interest accrued and unpaid on the
Securities, including any Additional Sums and Compounded Interest (together,
"Deferred Interest") that shall be payable to the holders of the Securities
in whose names the Securities are registered in the Security Register on the
first record date preceding the end of the Extended Interest Payment Period.
Before the termination of any Extended Interest Payment Period, the Company
may further defer payments of interest by further extending such period,
provided that such period, together with all such previous and further
extensions within such Extended Interest Payment Period, shall not exceed 10
consecutive semi-annual periods, including the first such semi-annual period
during such Extended Interest Payment Period, end on a date other than an
Interest Payment Date or extend beyond the Maturity Date of the Securities.
Upon the termination of any Extended Interest Payment Period and the payment
of all Deferred Interest then due, the Company may commence a new Extended
Interest Payment Period, subject to the foregoing requirements. No interest
shall be due and payable during an Extended Interest Payment Period, except
at the end thereof, but the Company may prepay at any time all or any portion
of the interest accrued during an Extended Interest Payment Period.
SECTION 16.02. Notice of Extension.
(a) If the Property Trustee is the only registered holder of the
Securities at the time the Company selects an Extended Interest Payment
Period, the Company shall give written notice to the Administrative Trustees,
the Property Trustee and the Trustee of its selection of such Extended
Interest Payment Period five Business Days before the earlier of (i) the next
succeeding date on which Distributions on the Trust Securities issued by the
Trust are payable, or (ii) the date the Trust is required to give notice of
the record date, or the date such Distributions are payable, to any national
securities exchange or to holders
72
of the Capital Securities issued by the Trust, but in any event at least five
Business Days before such record date.
(b) If the Property Trustee is not the only holder of the
Securities at the time the Company selects an Extended Interest Payment
Period, the Company shall give the holders of the Securities and the Trustee
written notice of its selection of such Extended Interest Payment Period at
least 10 Business Days before the earlier of (i) the next succeeding Interest
Payment Date, or (ii) the date the Company is required to give notice of the
record or payment date of such interest payment to any national securities
exchange.
(c) The semi-annual period in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 16.02 shall be counted as one of the 10
semi-annual periods permitted in the maximum Extended Interest Payment Period
permitted under Section 16.01.
00
Xxx Xxxx xx Xxx Xxxx hereby accepts the trusts in this Indenture
declared and provided, upon the terms and conditions hereinabove set forth.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed by their respective officers thereunto duly authorized, as
of the day and year first above written.
PROGRESS FINANCIAL CORPORATION
By: /s/Xxxxxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxxxxx X. Xxxxx
Title: Senior Vice President and Chief
Financial Officer
THE BANK OF NEW YORK,
as Trustee
By: /s/Xxxx Xxxx Xxxxxxxxx
-------------------------------
Name: Xxxx Xxxx Xxxxxxxxx
Title: Vice President
74
EXHIBIT A
(FORM OF FACE OF SECURITY)
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAW. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF
THE ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR
ANY "AFFILIATE" OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF THIS SECURITY) ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING
OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT
THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT,
SUBJECT TO THE RIGHT OF THE COMPANY PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
(i) PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO THE COMPANY,
AND (ii) PURSUANT TO CLAUSE (D), TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN
THE FORM APPEARING ON THE REVERSE OF THIS SECURITY IS COMPLETED AND DELIVERED
BY THE TRANSFEREE TO THE COMPANY. SUCH HOLDER FURTHER AGREES THAT IT WILL
DELIVER TO EACH PERSON
A-1
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND.
THE SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS
HAVING AN AGGREGATE PRINCIPAL AMOUNT OF NOT LESS THAN $100,000 (100
SECURITIES). ANY SUCH TRANSFER OF SECURITIES IN A BLOCK HAVING AN AGGREGATE
PRINCIPAL AMOUNT OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO
LEGAL EFFECT WHATSOEVER. ANY SUCH TRANSFEREE SHALL BE DEEMED NOT TO BE THE
HOLDER OF SUCH SECURITIES FOR ANY PURPOSE, INCLUDING BUT NOT LIMITED TO THE
RECEIPT OF PRINCIPAL, PREMIUM (IF ANY) OR INTEREST OF SUCH SECURITIES, AND
SUCH TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH
SECURITIES.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF ALSO AGREES,
REPRESENTS AND WARRANTS THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN
SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA") OR (ii) THE ACQUISITION AND HOLDING OF THIS SECURITY BY IT IS NOT
PROHIBITED BY EITHER SECTION 406 OF ERISA OR SECTION 4975 OF THE U.S.
INTERNAL REVENUE CODE OF 1986, AS AMENDED, OR EXEMPT FROM ANY SUCH
PROHIBITION.
A-2
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY.
No. CUSIP No.
PROGRESS FINANCIAL CORPORATION
____% SERIES A JUNIOR SUBORDINATED DEFERRABLE INTEREST
DEBENTURE DUE _______ __, 2027
Progress Financial Corporation, a Delaware corporation (the
"Company", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to The
Bank of New York, as Property Trustee for Progress Capital Trust I or
registered assigns, the principal sum of $15,464,000 on ______ _, 2027 (the
"Maturity Date"), unless previously redeemed, and to pay interest on the
outstanding principal amount hereof from June __, 1997, or from the most
recent interest payment date (each such date, an "Interest Payment Date") to
which interest has been paid or duly provided for, semi-annually (subject to
deferral as set forth herein) in arrears on ________ __ and _________ __ of
each year, commencing __________ __, 1997, at the rate of ____% per annum
until the principal hereof shall have become due and payable, and on any
overdue principal and premium, if any, and (without duplication and to the
extent that payment of such interest is enforceable under applicable law) on
any overdue installment of interest at the same rate per annum compounded
semi-annually. The amount of interest payable on any Interest Payment Date
shall be computed on the basis of a 360-day year of twelve 30-day months and,
for any period less than a full calendar month, the number of days elapsed in
such month based on a 30-day month. In the event that any date on which the
principal of (or premium, if any) or interest on this Security is payable is
not a Business Day, then the payment payable on such date will be made on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay), except that if such next succeeding
Business Day falls in the next calendar year, then such payment shall be made
on the immediately preceding Business Day, in each case with the same force
and effect as if made on such date. Pursuant to the Indenture, in certain
circumstances the Company will be required to pay Additional Sums and
Compounded Interest (each as defined in the Indenture) with respect to this
Security. Pursuant to the Registration Rights Agreement, in certain limited
circumstances the Company will be required to pay Liquidated Damages (as
defined in the Registration Rights Agreement) with respect to this Security.
A-3
The interest installment so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities, as defined in said Indenture) is registered at the
close of business on the regular record date for such interest installment,
which shall be at the close of business on the _ day of the month in which
the relevant interest payment date falls. Any such interest installment not
punctually paid or duly provided for shall forthwith cease to be payable to
the holders on such regular record date and may be paid to the Person in
whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a special record date to be fixed by
the Trustee for the payment of such defaulted interest, notice whereof shall
be given to the holders of Securities not less than 10 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 Securities may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Indenture.
The principal of (and premium, if any) and interest (including
Compounded Interest and Additional Sums, if any) and Liquidated Damages, if
any, on this Security shall be payable at the office or agency of the Trustee
maintained for that purpose in any coin or currency of the United States of
America that at the time of payment is legal tender for payment of public and
private debts; provided, however, that, payment of interest may be made at
the option of the Company by (i) check mailed to the holder at such address
as shall appear in the Security Register or (ii) by transfer to an account
maintained by the Person entitled thereto, provided that proper written
transfer instructions have been received by the relevant record date.
Notwithstanding the foregoing, so long as the Holder of this Security is the
Property Trustee, the payment of the principal of (and premium, if any) and
interest (including Compounded Interest and Additional Sums, if any) and
Liquidated Damages, if any, on this Security will be made at such place and
to such account as may be designated by the Property Trustee.
The indebtedness evidenced by this Security is, to the extent
provided in the Indenture, subordinate and junior in right of payment to the
prior payment in full of all Senior Indebtedness, and this Security is issued
subject to the provisions of the Indenture with respect thereto. Each holder
of this Security, by accepting the same, (a) agrees to and shall be bound by
such provisions, (b) authorizes and directs the Trustee on his or her behalf
to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination so provided and (c) appoints the Trustee his or
her attorney-in-fact for any and all such purposes. Each holder hereof, by
his or her acceptance hereof, hereby waives all notice of the acceptance of
the subordination provisions contained herein and in the Indenture by each
holder of Senior Indebtedness, whether now outstanding or hereafter incurred,
and waives reliance by each such holder upon said provisions.
This Security shall not be entitled to any benefit under the
Indenture hereinafter referred to, be valid or become obligatory for any
purpose until the Certificate of Authentication hereon shall have been signed
by or on behalf of the Trustee.
A-4
The provisions of this Security are continued on the reverse side
hereof and such provisions shall for all purposes have the same effect as
though fully set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed and sealed.
Dated: ________________, 1997
PROGRESS FINANCIAL CORPORATION
By: ____________________________
Name: Xxxxxxxxx X. Xxxxx
Title: Senior Vice President and Chief
Financial Officer
Attest:
By: _______________________
Name:
Title:
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned
Indenture.
THE BANK OF NEW YORK, Dated: , 1997
as Trustee
By____________________
Authorized Signatory
A-5
(FORM OF REVERSE OF SECURITY)
This Security is one of the Securities of the Company (herein
sometimes referred to as the "Securities"), specified in the Indenture, all
issued or to be issued under and pursuant to an Indenture, dated as of June
__, 1997 (the "Indenture"), duly executed and delivered between the Company
and The Bank of New York, as Trustee (the "Trustee"), to which Indenture
reference is hereby made for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the Trustee, the
Company and the holders of the Securities.
Upon the occurrence and continuation of a Special Event prior to
June __, 2007 (the "Initial Optional Redemption Date"), the Company shall
have the right, at any time within 90 days following the occurrence of such
Special Event, to redeem this Security in whole (but not in part) at the
Special Event Redemption Price. "Special Event Redemption Price" shall mean,
with respect to any redemption of the Securities following a Special Event,
an amount in cash equal to the Make Whole Amount. The "Make Whole Amount"
shall mean an amount equal to the greater of (i) 100% of the principal amount
to be redeemed or (ii) the sum, as determined by a Quotation Agent, of the
present values of remaining scheduled payments of principal and interest,
discounted to the prepayment date on a semi-annual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Adjusted Treasury Rate, plus,
in the case of each of clauses (i) and (ii), any accrued and unpaid interest
thereon (including Compounded Interest and Additional Sums, if any) and
Liquidated Damages, if any, to the date of such redemption.
In addition, the Company shall have the right to redeem this
Security, in whole or in part, at any time on or after the Initial Optional
Redemption Date (an "Optional Redemption"), at the redemption prices set
forth below (expressed as percentages of principal to be redeemed) plus, in
each case, accrued and unpaid interest thereon (including Additional Sums and
Compounded Interest, if any) and Liquidated Damages, if any, to the
applicable date of redemption (the "Optional Redemption Price") if redeemed
during the 12-month period beginning ______ __ of the years indicated below.
A-6
Year Percentage
---- ----------
2007 %
2008 %
2009 %
2010 %
2011 %
2012 %
2013 %
2014 %
2015 %
2016 %
2017 and thereafter 100.000%
The Optional Redemption Price or the Special Event Redemption Price,
as the case requires, shall be paid prior to 12:00 noon, New York time, on
the date of such redemption or at such earlier time as the Company
determines, provided, that the Company shall deposit with the Trustee an
amount sufficient to pay the applicable Redemption Price by 10:00 a.m., New
York City, on the date such Redemption Price is to be paid. Any redemption
pursuant to this paragraph will be made upon not less than 30 days nor more
than 60 days notice. If the Securities are only partially redeemed by the
Company pursuant to an Optional Redemption, the particular Securities to be
redeemed shall be selected on a pro rata basis, by lot or such other method
that the Trustee shall utilize, not more than 60 days prior to the date fixed
for redemption from the outstanding Securities not previously called for
redemption, provided, however, that with respect to Securityholders that
would be required to hold Securities with an aggregate principal amount of
less than $100,000 but more than an aggregate principal amount of zero as a
result of such pro rata redemption, the Company shall redeem Securities of
each such Securityholder so that after such redemption such Securityholder
shall hold Securities either with an aggregate principal amount of at least
$100,000 or such Securityholder no longer holds any Securities and shall use
such method (including, without limitation, by lot) as the Company shall deem
fair and appropriate, provided, further, that any such method of selection
may be made on the basis of the aggregate principal amount of Securities held
by each Securityholder thereof and may be made by making such adjustments as
the Company deems fair and appropriate in order that only Securities in
denominations of $1,000 or integral multiples thereof shall be redeemed.
A-7
In the event of redemption of this Security in part only, a new
Security or Securities for the unredeemed portion hereof will be issued in
the name of the holder hereof upon the cancellation hereof.
Notwithstanding the foregoing, any redemption of Securities by the
Company shall be subject to the receipt of any required regulatory approval.
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Securities may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the
Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of a majority in aggregate principal
amount of the Securities at the time outstanding, as defined in the
Indenture, to execute supplemental indentures for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of the Indenture or of modifying in any manner the rights of the holders of
the Securities; provided, however, that no such supplemental indenture shall,
without the consent of each holder of Securities then outstanding and
affected thereby, (i) change the Maturity Date of any Securities, or reduce
the principal amount thereof, or reduce any amount payable on redemption
thereof, or reduce the rate or extend the time of payment of interest thereon
(subject to Article XVI of the Indenture), or make the principal of, or
interest or premium on, the Securities payable in any coin or currency other
than U.S. dollars, or impair or affect the right of any holder of Securities
to institute suit for the payment thereof, or (ii) reduce the aforesaid
percentage of Securities, the holders of which are required to consent to any
such supplemental indenture. The Indenture also contains provisions
permitting the holders of a majority in aggregate principal amount of the
Securities at the time outstanding affected thereby, on behalf of all of the
holders of the Securities, to waive any past default in the performance of
any of the covenants contained in the Indenture, or established pursuant to
the Indenture, and its consequences, except a default in the payment of the
principal of or premium, if any, or interest on any of the Securities or a
default in respect of any covenant or provision under which the Indenture
cannot be modified or amended without the consent of each holder of
Securities then outstanding. Any such consent or waiver by the holder of
this Security (unless revoked as provided in the Indenture) shall be
conclusive and binding upon such Holder and upon all future holders and
owners of this Security and of any Security issued in exchange herefor or in
place hereof (whether by registration of transfer or otherwise), irrespective
of whether or not any notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest (including Compounded Interest and Additional
Sums, if any) and Liquidated Damages, if any, on this Security at the time
and place and at the rate and in the money herein prescribed.
A-8
So long as no Event of Default shall have occurred and be
continuing, the Company shall have the right, at any time and from time to
time during the term of the Securities, to defer payments of interest by
extending the interest payment period of such Securities for a period not
exceeding 10 consecutive semi-annual periods, including the first such
semi-annual period during such extension period, and not extending beyond the
Maturity Date of the Securities (an "Extended Interest Payment Period") or
ending on a date other than an Interest Payment Date, at the end of which
period the Company shall pay all interest then accrued and unpaid (together
with interest thereon at the rate specified for the Securities to the extent
that payment of such interest is enforceable under applicable law). Before
the termination of any such Extended Interest Payment Period, the Company may
further defer payments of interest by further extending such Extended
Interest Payment Period, provided that such Extended Interest Payment Period,
together with all such previous and further extensions within such Extended
Interest Payment Period, (i) shall not exceed 10 consecutive semi-annual
periods, including the first semi-annual period during such Extended Interest
Payment Period, (ii) shall not end on any date other than an Interest Payment
Date, and (iii) shall not extend beyond the Maturity Date of the Securities.
Upon the termination of any such Extended Interest Payment Period and the
payment of all accrued and unpaid interest and any additional amounts then
due, the Company may commence a new Extended Interest Payment Period, subject
to the foregoing requirements.
The Company has agreed that it will not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital stock
(which includes common and preferred stock), (ii) make any payment of
principal, interest or premium, if any, on or repay or repurchase or redeem
any debt securities of the Company that rank pari passu with or junior in
right of payment to the Securities or (iii) make any guarantee payments with
respect to any guarantee by the Company of the debt securities of any
Subsidiary of the Company if such guarantee ranks pari passu or junior in
right of payment to the Securities (other than (a) dividends or distributions
in shares of, or options, warrants or rights to subscribe for or purchase
shares of, Common Stock of the Company, (b) any declaration of a dividend in
connection with the implementation of a stockholder's rights plan, or the
issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto, (c) payments under the
Capital Securities Guarantee, (d) as a result of a reclassification of the
Company's capital stock or the exchange or the conversion of one class or
series of the Company's capital stock, for another class or series of the
Company's capital stock, (e) the purchase of fractional interests in shares
of the Company's capital stock pursuant to the exchange or conversion of such
capital stock or the security being exchanged or converted and (f) purchases
of Common Stock related to the issuance of Common Stock or rights under any
of the Company's benefit plans for its directors, officers or employees or
any of the Company's dividend reinvestment plans) if at such time (1) there
shall have occurred any event of which the Company has actual knowledge that
(a) is or, with the giving of notice or the lapse of time, or both, would be,
an Event of Default and (b) in respect of which the Company shall not have
taken reasonable steps to cure, (2) if the Securities are held by Progress
Capital Trust, the Company shall be in default with respect
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to its payment obligations under the Capital Securities Guarantee or (3) the
Company shall have given notice of its election of the exercise of its right
to extend the interest payment period and any such extension shall be
continuing.
Subject to (i) the receipt of any required regulatory approval and
(ii) the receipt by the Company of an opinion of counsel to the effect that
such distribution will not be a taxable event to holders of Capital
Securities, the Company will have the right at any time to liquidate Progress
Capital Trust and cause the Securities to be distributed to the holders of
the Trust Securities in liquidation of the Trust.
The Securities are issuable only in registered form without coupons
in denominations of $1,000.00 and any integral multiple thereof. As provided
in the Indenture and subject to the transfer restrictions limitations as may
be contained herein and therein from time to time, this Security is
transferable by the holder hereof on the Security Register of the Company,
upon surrender of this Security for registration of transfer at the office or
agency of the Company in the City and State of New York accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Company or the Trustee duly executed by the holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Securities of
authorized denominations and for the same aggregate principal amount and
series will be issued to the designated transferee or transferees. No service
charge will be made for any such registration of transfer, but the Company
may require payment of a sum sufficient to cover any tax or other
governmental charge payable in relation thereto.
Prior to due presentment for registration of transfer of this
Security, the Company, the Trustee, any authenticating agent, any paying
agent, any transfer agent and the registrar may deem and treat the holder
hereof as the absolute owner hereof (whether or not this Security shall be
overdue and notwithstanding any notice of ownership or writing hereon made by
anyone other than the Security Registrar) for the purpose of receiving
payment of or on account of the principal hereof and premium, if any, and
(subject to the Indenture) interest due hereon and for all other purposes,
and neither the Company nor the Trustee nor any authenticating agent nor any
paying agent nor any transfer agent nor any registrar shall be affected by
any notice to the contrary.
No recourse shall be had for the payment of the principal of or
premium, if any, or interest on this Security, or for any claim based hereon,
or otherwise in respect hereof, or based on or in respect of the Indenture,
against any incorporator, stockholder, officer or director, past, present or
future, as such, of the Company or of any predecessor or successor Person,
whether by virtue of any constitution, statute or rule of 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
issuance hereof, expressly waived and released.
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All terms used in this Security that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
THE INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICT OF LAW PROVISIONS THEREOF.
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