FIRST SUPPLEMENTAL INDENTURE
dated as of July 3l, 1996
to
TRUST INDENTURE
dated as of July 31, 1996
among
PANDA FUNDING CORPORATION,
PANDA INTERFUNDING CORPORATION
and
BANKERS TRUST COMPANY, AS TRUSTEE
________________________________________________________________
FIRST SUPPLEMENTAL INDENTURE, dated as of July 31, 1996
(this First Supplemental Indenture"), to the Trust Indenture
dated as of July 31, 1996 (together with any amendments or
supplements permitted thereunder, the "Original Indenture") among
PANDA FUNDING CORPORATION, a Delaware corporation ("Panda
Funding"), its executive office and mailing address being at 0000
Xxxxxx Xxxxxx Xxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000, PANDA
INTERFUNDING CORPORATION, a Delaware corporation ("PIC"), its
executive office and mailing address being at 0000 Xxxxxx Xxxxxx
Xxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000, and BANKERS TRUST COMPACT,
a New York state banking corporation (the "Trustee"), its
corporate trust office and mailing address being at 0
XxxxxxXxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
WHEREAS, Panda Funding, PIC and the Trustee have heretofore
executed and delivered the Original Indenture to provide for the
issuance by Panda Funding of Bonds (as defined in the Original
Indenture) to be issued in one or more series;
WHEREAS, Sections 2.l, 2.3 and 12.1 of the Original
Indenture provide, among other things, that Panda Funding, PIC
and the Trustee may enter into indentures supplemental to the
Original Indenture without the consent of the holders of the
Bonds for, among other things. the purpose of establishing the
designation, form, terms and provisions of the Bonds of any
series as permitted by Sections 2.1, 2.3 and 12.1 of the Original
Indenture;
WHEREAS, Panda Funding has requested the Trustee and PIC to
enter into this First Supplemental Indenture for the purpose of
establishing the designation, form, terms and provisions of the
Bonds to be issued hereunder;
WHEREAS, the Series A Bonds (as hereinafter defined) are to
be issued and sold in transactions exempt from registration under
the Securities Act pursuant to the Purchase Agreement and the
Series A-l Bonds (as hereinafter defined) are to be issued in
exchange for the Series A Bonds pursuant to the Registration
Rights Agreement;
WHEREAS, all action on the part of Panda Funding necessary
to authorize the issuance of said Bonds under the Original
Indenture and this First Supplemental Indenture (the Original
Indenture, as supplemented by this First Supplemental Indenture,
being hereinafter called the "Indenture") has been duly taken;
and
WHEREAS, all acts necessary to make said Bonds, when
executed by Panda Funding and having the notation of the PIC
Guaranty thereon executed by PIC and authenticated and delivered
by the Trustee as provided in the Original Indenture, the valid
and binding legal obligations of Panda Funding and PIC, and to
make this First Supplemental Indenture a valid and binding
agreement in accordance with its terms and the terms of the
Original Indenture upon each of Panda Funding and PIC, have been
done and performed, and the execution of this First Supplemental
Indenture and the creation and issuance under the Indenture of
said Bonds (including the notation of the PIC Guaranty thereon)
have in all respects been duly authorized, and each of Panda
Funding and PIC, in the exercise of the legal right and power
vested in it, executes this First Supplemental Indenture and
proposes to create, execute, issue and deliver said Bonds;
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE
WITNESSETH:
That, in order to establish the designation, form, terms and
provisions of, and to authorize the authentication and delivery
of, said Bonds, and in consideration of the acceptance of said
Bonds by the Holders thereof and of other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
(a) Terms used herein and not otherwise defined herein
shall have the respective meanings assigned thereto in the
Original Indenture or in Appendix A thereto. All rules of
construction set forth in the Original Indenture (including
Article I of the Original Indenture) shall apply to this First
Supplemental Indenture.
(b) For all purposes of this First Supplemental Indenture,
except as otherwise expressly provided or unless the context
otherwise requires, the following terms shall have the following
respective meanings (such meanings shall apply equally to both
the singular and plural forms of the respective teas):
"Additional Interest" shall have the meaning ascribed
thereto in Section 2.1 hereof.
"Called Principal" shall mean, with respect to any Initial
Bond, the principal of such Initial Bond that is to be redeemed
pursuant to Section 2.5(b) of the First Supplemental Indenture.
"Discounted Value" shall mean, with respect to the Called
Principal of any Initial Bond, the amount obtained by discounting
all Remaining Scheduled Payments with respect to such Called
Principal from their respective scheduled due dates to the
applicable Redemption Date with respect to such Called Principal,
in accordance with accepted financial practice and at a discount
factor (applied on the same periodic basis as that on which
interest on the Initial Bonds payable) equal to the Reinvestment
Yield with respect to such Called Principal.
"Exchange Offer" shall mean the offer by Panda Funding,
pursuant to an effective registration statement filed with the
SEC, to exchange Series A-1 Bonds for Outstanding Series A Bonds
in accordance with the terms and provisions of the Registration
Rights Agreement.
"Exchange Offer Consummation Date" shall mean the date on
which the Exchange Offer is consummated in accordance with the
terms and provisions of the Registration Rights Agreement.
"Final Maturity Date" shall mean August 20, 2012.
"Initial Bonds" shall mean. collectively the Series A Bonds
and the Series A-l Bonds.
"Interest Payment Dates" shall mean each February 20 and
August 20 of each year commencing on February 20, 1997, or if
such day is not a Business Day, the next succeeding Business Day.
"Issue Date" shall mean the date of the first issuance of
the Series A Bonds hereunder.
"Make-Whole Amount" shall mean' with respect to any Initial
Bond, an amount equal to the excess, if any, of the Discounted
Value of the Remaining Scheduled Payments with respect to the
Called Principal of such Initial Bond over the amount of such
Called Principal, provided that the Make-Whole Amount may in no
event be less than zero. Two Business Days prior to the
redemption of the Initial Bonds pursuant to Section 2.5(b) of the
First Supplemental Indenture, Panda Funding shall deliver to the
Trustee an Officer's Certificate specifying the calculation of
such Make-Whole Amount as of the specified mandatory redemption
date.
"Principal Payment Dates" shall mean the dates on which
regularly scheduled installments of principal are due on the
Initial Bonds as set forth in the form of the Initial Bond
attached hereto as Exhibit A.
"Registration Default" shall have the meaning ascribed
thereto in the Registration Rights Agreement.
"Registration Rights Agreement" shall mean the Registration
Rights Agreement to be dated on or about the Issue Date, among
Panda Funding, PIC and the Initial Purchaser.
"Reinvestment Yield" shall mean, with respect to the Called
Principal of any Initial Bond, 0.50 percent over the yield to
maturity multiplied by (i) the yields reported, as of 10:00 A.M.
(New York City time) on the second Business Day preceding the
applicable mandatory redemption date with respect to such Called
Principal, on the display designated as "Page 678 on the Telerate
Access Service (or such other display as may replace 678 on
Telerate Access Service), for actively traded U.S. Treasury
securities having a maturity equal to the remaining term of the
Initial Bonds as of such mandatory redemption date, or (ii) if
such yields are not reported as of such time or the yields
reported as of such time are not ascertainable, the Treasury
Constant Maturity Series Yields reported, for the latest day for
which such yields have been so reported as of the second Business
Day preceding the Redemption Date with respect to such Called
Principal, in U.S. Federal Reserve Statistical Release H.15 (519)
(or any comparable successor publication) for actively traded
U.S. Treasury securities having a constant maturity equal to the
remaining term of the Initial Bonds as of such Redemption Date.
Such implied yield will be determined, if necessary, by (a)
converting U.S. Treasury xxxx quotations to bond-equivalent
yields in accordance with accepted financial practice and (b)
interpolating linearly between (1) the actively traded U.S.
Treasury security with the duration closest to and greater than
the remaining tend of the Initial Bonds and (2) the actively
traded U.S. Treasury security with the duration closest to and
less than the remaining term of the Initial Bonds.
"Remaining Scheduled Payments" shall mean, with respect to
the Called Principal of any Initial Bond, all payments of such
Called Principal and interest thereon that should be due after
the Redemption Date with respect to such Called Principal if no
redemption of such Called Principal were made prior to its
scheduled due date, provided that if such mandatory redemption
date is not a date on which interest payments are due to be made
under the terms of the Initial Bonds, then the amount of the next
succeeding scheduled interest payment will be reduced by the
amount of interest accrued to such mandatory redemption date and
required to be paid on such mandatory redemption date pursuant to
Section 2.5(b) of the First Supplemental Indenture.
"Series A Bonds" shall have the meaning ascribed hereto in
Section 2.1 (a) hereof.
"Series A-1 Bonds" shall have the meaning ascribed thereto
in Section 2.1(a) hereof.
"Transfer Restricted Securities" shall have the meaning
ascribed thereto in the Registration Rights Agreement; provided,
however, that the Trustee shall be entitled to request and
conclusively rely upon an Opinion of Counsel with respect to
whether or not any Series A Bond is a Transfer Restricted
Security.
ARTICLE II
THE TERMS OF THE BONDS
Section 2.1. Terms and Conditions of the Initial Bonds.
(a) Title and Date. There is hereby created a series of
Bonds designated as the "11 5/8 percent Pooled Project Bonds,
Series A due 2012" (the "Series A Bonds"). The Series A Bonds
shall mature on the Final Maturity Date.
In addition, there is hereby created a series of Bonds
designated as the "11 5/8 percent Pooled Project Bonds, Series X-
0 xxx 0000" (xxx "Series A-l Bonds"). The Series A-1 Bonds shall
mature on the Final Maturity Date.
(b) Limitation on Aggregate Principal Amount. The aggregate
principal amount of Series A Bonds that may be authenticated and
delivered under the Indenture for original issue is limited to
$105,525,000 and the aggregate principal amount of Series A-1
Bonds that may be authenticated and delivered under the Indenture
for original issue is limited to $105,525,000. The aggregate
principal amount of Initial Bonds Outstanding at any one time may
not exceed $105,525,000 except as provided in Section 2.10 of the
Original Indenture.
(c) Interest and Principal. The Series A Bonds shall bear
interest at the rate of 11 5/8 percent per annum from the Issue
Date, or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, payable semiannually
on each Interest Payment Date and at the Final Maturity Date,
until the principal thereof is paid or duly provided for. The
principal amount of each Series A Bond created hereby shall be
due and payable semiannually in installments on each Principal
Payment Date as set forth in the form of the Initial Bond
attached hereto as Exhibit A to the Holders of record as of the
dates set forth in such form of Initial Bond.
The Series A-1 Bonds shall bear interest at the rate of 11
5/8 percent per annum from the date thereof, or from the most
recent Interest Payment Date to which interest has been paid or
duly provided for, payable semiannually on each Interest Payment
Date and at the Final Maturity Date, until the principal thereof
is paid or duly provided for. The principal amount of each Series
A I Bond created hereby shall be due and payable semiannually in
installments on each principal Payment Date as set forth in the
form of the Initial Bond attached hereto as Exhibit A to the
Holders of record as of the dates set forth in such form of
Initial Bond.
Accrued but unpaid interest on any Series A Bond that is
exchanged for a Series X-x Xxxx pursuant to the Registration
Rights Agreement shall be paid on or before the first Interest
Payment Date on the Series A-1 Bonds.
(d) Additional interest. Upon the occurrence of a
Registration Default, the interest rate on Transfer Restricted
Securities shall increase ("Additional Interest") by 0.50% per
annum effective on the 181st day following the Issue Date and
Additional Interest shall accrue until all Registration Defaults
have been cured. Following the cure of all Registration Defaults,
the accrual of Additional Interest will cease and the interest
rate shall revert to the original rate; provided, however, if all
Registration Defaults are not cured within two (2) years
following the Issue Date, such increase in the interest rate
shall become permanent. Any Additional Interest due on any
Initial Bond shall be payable on the appropriate Interest Payment
Date to the Holder entitled to receive the interest payment to be
made on such date. Each obligation to pay Additional Interest
shall be deemed to accrue from and including the date of the
applicable Registration Default.
(e) Initial Bonds Considered a Single Class. The Series A
Bonds and the Series A-l Bonds shall be considered collectively
to be a single class for all purposes of this Indenture,
including, without limitation, waivers, amendments, redemptions
and offers to purchase.
(f) Defeasance. The Initial Bonds shall be subject to
defeasance at the option of Panda Funding as provided in Article
VI of the Original Indenture.
(g) PIC Guaranty. The Initial Bonds shall be guaranteed by
PIC as provided in Article XIII of the Original Indenture.
(h) Form of Initial Bonds. The Initial Bonds shall be
issued in definitive form, shall be substantially in the form of
and have the terms and conditions set forth in the form of
Initial Bond attached hereto as Exhibit A and each shall have and
be subject to such other terms as provided herein and in the
Original Indenture, including without limitation Section 2.3
thereof.
Section 2.2. Delivery. At any time after the execution and
delivery of this First Supplemental Indenture, Panda Funding may
deliver Series A Bonds executed by Panda Funding and having the
notation of the PIC Guaranty executed by PIC to the Trustee for
authentication, together with a Company Order for the
authentication and delivery of such Series A Bonds, and the
Trustee in accordance with such Company Order shall authenticate
and deliver such Series A Bonds with the notation of the PIC
Guaranty thereon as provided in the Indenture. In addition, on or
prior to the Exchange Offer Consummation Date, Panda Funding may
deliver Series A-1 Bonds executed by Panda Funding and having the
notation of the PIC Guaranty executed by PIC to the Trustee for
authentication together with a Company Order for the
authentication and delivery of such Series A-1 Bonds, and the
Trustee in accordance with such Company Order shall authenticate
and deliver such Series A-1 Bonds with the notations of the PIC
Guaranty thereon as provided in the Indenture.
Section 2.3. Restrictions on Transfer and Exchange of
Initial Bonds.
All Series A Bonds issued hereunder shall be restricted
securities (within the meaning of Rule 144 under the Securities
Act) and shall be subject to the restrictions on transfer
provided in Section 2.8 of the Original Indenture and the legends
set forth on the Series A Bonds.
As provided in the Registration Rights Agreement and subject
to the limitations set forth therein, at the option of the
Holders, the Series A Bonds shall be exchangeable for Series A-l
Bonds of like aggregate principal amount pursuant to the Exchange
Offer.
Section 2.4 Method of Payment.
Payment of principal of (and premium, if any, on) and
interest on each Initial Bond created hereby shall be made (a) if
Panda Funding so elects, by check mailed to the Holder at his or
her registered address, (b) notwithstanding any such election by
Panda Funding, if a Holder of $2,000,000 or more in aggregate
principal amount (or such lesser principal amount as results from
all payments of principal and redemptions in respect of an
Initial Bond in the original principal amount of $2,000,000) of
Initial Bonds requests in writing, by wire transfer of
immediately available funds pursuant to written wire instructions
delivered to the Trustee on or before the applicable Regular
Record Date or (c) otherwise as provided in Section 2.11 of the
Original Indenture; provided that the final installment of
principal payable with respect to each Initial Bond created
hereby shall be payable as provided in Section 8.5 of the
Original Indenture (in the case of any such Initial Bond redeemed
or prepaid) or payable upon presentation and surrender of each
such Initial Bond at the Place of Payment.
Section 2.5 Redemption.
(a) Optional Redemption. The Initial Bonds created hereby
are subject to optional redemption on the terms set forth in
Section 4.9 of the Original Indenture.
In addition, subject to the provision of Article VIII of the
Original Indenture, the Initial Bonds are subject to redemption
by Panda Funding prior to Stated Maturity, in whole or in part on
any Business Day on or after August 20, 2001, and if in part in
integral multiples of $1,000. Any such redemption shall be at the
redemption prices (expressed as percentages of principal amount)
set forth in the table below plus accrued interest if any, to the
redemption date, if redeemed during the 12-month period
commencing on or after August 20 of years set forth below:
Year Redemption Price
2001 105.8125%
2002 104.3594%
2003 102.9063%
2004 101.4532%
2005 100.0000%
(b) Mandatory Redemption. Subject to the provisions of
Section 8.3 of the Original Indenture, the Initial Bonds created
hereby are subject to mandatory redemption under the conditions
and on the terms set forth in Section 4.8 of the Original
Indenture. In addition, Panda Funding shall pay a premium on all
Initial Bonds subject to such mandatory redemption in an amount
equal to the premium, if any, payable were the Initial Bonds to
be redeemed at Panda Funding's option (or, if no optional
redemption is available with respect to the Initial Bonds, plus
the Make-Whole amount determined for the mandatory redemption
date with respect to such principal "amount"), to the extent such
mandatory redemption results from a sale or other voluntary
disposition of any Collateral or any interest in a Project.
(c) Offer to Purchase. In the event of a Change of Control
and subject to the conditions and limitations set forth in
Section 7.32 of the Original Indenture, Panda Funding shall be
obligated to make an offer to the Holders to purchase on a
Business Day not more than 60 or less than 30 days following the
occurrence of a Change of Control, all of the then Outstanding
Initial Bonds at a purchase price equal to 101% of the principal
amount thereof, together with accrued and unpaid interest, if
any, to the change of Control Purchase Date, as provided in
Section 7.32.
Section 2.6. Use of Proceeds. Panda Funding shall lend all
of the proceeds received by it from the sale of the Initial Bonds
to PIC which shall use such proceeds (i) to fund the Capitalized
Interest Fund in the amount of $9,834,109.78; (ii) to fund the
Debt Service Reserve Fund in the amount of $6,413,483.00; (iii)
to fund the PIC Expense Fund in the amount of approximately
$300,000; (iv) to pay transaction expenses, commissions and fees
incurred in connection with the issuance and offering of the
Initial Bonds, estimated to be approximately $900,000; (v) to
fund in the amount of approximately $25,100,000 a portion of the
redemption by Panda-Xxxxxxxx L.P., a Delaware limited
partnership, of the limited partnership interest therein held by
Ford Motor Credit Company, a Delaware corporation; and (vi) to
distribute approximately $60,900,000 to PEI, of which
approximately $26,400,000 shall be used by PEI to prepay senior
indebtedness held by Trust Company of the West, and the balance
of which Panda International intends to use for the development
of Projects and for general corporate purposes.
Section 2.7. Service Reserve Fund. On the Issue Date, PIC
shall deliver to the Trustee for deposit in the Debt Service
Reserve Fund $6,413,483.00, out of the loan by Panda Funding to
PIC of the proceeds of the Series A Bonds, which amount shall
constitute the Debt Service Reserve Requirement with respect to
the Initial Bonds on the Issue Date..
Section 2.8. Capitalized Interest Fund On the Issue Date,
PIC shall deliver to the Trustee for deposit in the Capitalized
Interest Fund $9,834,109.78 out of the loan by Panda Funding to
PIC of the proceeds of the Series A Bonds. Subject to Section
4.4(e) of the Original Indenture, the Capitalized Interest
Requirement with respect to the Initial Bonds shall be an amount
equal to:(i) during the period beginning on the Issue Date to and
including February 19, 1997, $9,834,109.77, (ii) during the
period beginning February 20, 1997 to and including August
19,1997, $9,216,660.48, (iii) during the period beginning on
August 20, 1997 to and including February 19, 1998,
$8,028,359.78, (iv) during the period beginning on February 20,
1998 to and including August 19, 1998, $6,795,312.78, (v) during
the period beginning August 20,1998 to and including February 19,
1998, $3,410,003.73, (vi) during the period beginning February
20, 1999 to and including February 19, 2001, $106,613.80, (vii)
during the period beginning on February 20, 2001 to and including
August 19, 2001 $35,286.92 and (viii) thereafter the Capitalized
Interest Requirement with respect to the Initial Bonds shall be
zero. Monies from time to time held on deposit in the Capitalized
Interest Fund shall be transferred to the Debt Service Fund on
the Interest Payment Dates on February 20, 1997, August 20, 1997,
February 20, 1998, August 20, 1998, February 20, 1999, August 20,
2000 and February 20, 2001 in the amounts of $617,449.30,
$1,188,300.70, $1,233,047.00, $3,385,309.05, $3,303,389.93,
$7l,326.88 and $35,286.92, respectively.
Section 2.9. Additional Covenant. Panda Funding shall notify
the Trustee in writing and any Paying Agent immediately upon the
occurrence of any Registration Default and, with respect to
Additional Interest payments made pursuant to Section 2.1(c), PIC
shall notify the Trustee and any Paying Agent of the amount of
Additional Interest payable to each Holder.
ARTICLE III
MISCELLANEOUS
Section 3.1. Execution of Supplemental Indenture. This First
Supplemental Indenture is executed and shall be constructed as an
indenture supplemental to the Original Indenture and, as provided
in the Original Indenture, this First Supplemental Indenture
forms a part thereof.
Section 3.2. Concerning the Trustee. The recitals contained
herein and in the Series A Bonds created hereby, except with
respect to the Trustee's certificate of authentication, shall be
taken as the statements of Panda Funding and PIC and the Trustee
assumes no responsibility for the correctness of same. The
Trustee makes no representation as to the validity or sufficiency
of the First Supplemental Indenture or of the Bonds created
hereby.
Section 3.3. Counterparts. This First Supplemental Indenture
may be executed in any number of counterparts, each of which when
so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same
instrument.
Section 3.4. GOVERNING LAW. THIS FIRST SUPPLEMENTAL
INDENTURE AND EACH BOND (INCLUDING THE RELATED PIC GUARANTY
THEREON) CREATED HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICTS OF LAW RULES THEREOF (OTHER THAN SECTION 5-1401
OF THE NEW YORK GENERAL OBLIGATIONS LAWS).
IN WITNESS WHEREOF, the parties have caused this First
Supplemental Indenture to be duly executed by their respective
officers thereunto duly authorized as of the day and year first
above written.
PANDA FUNDING
By:
Name: Xxxxxx X. Xxxxxx
Title: Chairman of the Board, President
and Chief Executive Officer
PANDA INTERFUNDING CORPORATION
By:
Name: Xxxxxx X. Xxxxxx
Title: Chairman of the Board, President
and Chief Executive Officer
BANKERS TRUST COMPANY, AS TRUSTEE
By:
Name: Xxxxx Xxxxx
Title: Assistant Vice President
EXHIBIT A
[If a Series A or Series A-1 Bond constituting a Transfer
Restricted Bond-THIS BOND HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR
SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWINGS
SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (I) REPRESENTS
THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR
(7) UNDER REGULATION D OF THE SECURITIES ACT) (AN "INSTITUTIONAL
ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS BOND IN AN OFFSHORE TRANSACTION, (II) AGREES THAT
IT WILL NOT WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF
THIS BOND RESELL OR OTHERWISE TRANSFER THIS BOND EXCEPT (A) TO
PANDA FUNDING, (B) INSIDE THE UNITED STATES TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL
ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO
BANKERS TRUST COMPANY, AS TRUSTEE, OR A SUCCESSOR TRUSTEE, A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS BOND (THE FORM
OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (D) OUTSIDE
THE UNITED STATES TO FOREIGN PURCHASERS IN OFFSHORE TRANSACTIONS
MEETING THE REQUIREMENTS OF RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR
(F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND (III) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS BOND IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF
THIS BOND WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THE
BOND, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE
REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT
THE CERTIFICATE TO BANKERS TRUST COMPANY, AS SECURITY REGISTRAR.
IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED
INVESTOR THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO
PANDA FUNDING CORPORATION AND BANKERS TRUST COMPANY, AS SECURITY
REGISTRAR, SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER
INFORMATION AS THEY MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH
TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. THIS LEGEND WILL BE REMOVED AFTER THE EXPIRATION
OF THREE YEARS FROM THE ORIGINAL ISSUANCE OF THIS BOND. AS USED
HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND
"U.S. PERSON" HAVE THE RESPECTIVE MEANINGS GIVEN TO THEM BY
REGULATION S UNDER THE SECURITIES ACT.]
[If a Global Bond - THIS BOND IS A GLOBAL BOND WITHIN THE
MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A
DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS BOND IS NOT
EXCHANGEABLE FOR BONDS REGISTERED IN THE NAME OF A PERSON OTHER
THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
BOND (OTHER THAN A TRANSFER OF THIS BOND AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE
DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE INDENTURE.
UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO PANDA FUNDING OR ITS AGENT FOR
REGISTRATION OF TRANSFER EXCHANGE, OR PAYMENT, AND ANY BOND
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE
& CO., HAS AN INTEREST HEREIN.]
PANDA FUNDING CORPORATION
11 5/8% POOLED PROJECT BOND, SERIES A DUE 2012
NO. CUSIP NUMBER
PRINCIPAL AMOUNT FINAL MATURITY DATE ISSUE DATE INTEREST RATE
$ AUGUST 20, 2012 JULY ,1996 115/8 percent
Panda Funding Corporation, a Delaware corporation
(hereinafter called "Panda Funding", which term includes any
successor or assign under the Trust Indenture referred to below),
for_______ value received hereby promises to pay _______ to _______
or its registered assigns, the principal sum of (the "Principal
Amount"), such payment to be made in semiannual installments on
February 20 and August 20 of each year [If a Series A Bond-
(commencing February 20, 1997)][If a Series A-1 Bond-- (commencing
on the February 20 or August 20 following the original issuance
of the Series A-l Bonds)] and ending on the Final Maturity Date
set forth above, each such installment to be in an amount equal
to the Principal Amount multiplied by the percentage set forth
opposite the applicable payment date on the reverse hereof
(provided that the portion of the Principal Amount remaining
unpaid on the Final Maturity Date, together with all interest
accrued thereon, shall in any and all cases be due and payable on
the Final Maturity Date), and to pay interest on the unpaid
portion of the Principal Amount at the Interest Rate set forth
above from the most recent Interest Payment Date to which
interest has been paid or duly provided for or, if no interest
has been paid or duly provided for, from the Issue Date set forth
above, semiannually on February 20 and August 20 in each year [If
a Series A Bond --(commencing February 20, 1997)]If a Series A-1
Bond -- Commencing on the February 20 or August 20 following the
original issuance of the Series A-1 Bonds)], until the Principal
Amount is paid in full or payment thereof is duly provided for.
Panda Funding also promises to pay any Additional Interest
required by Section 2.1 (c) of the First Supplemental Indenture,
upon the conditions, at the rate and for the periods specified
therein. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in
such Indenture, be paid to the Person in whose name this Bond (or
one or more Predecessor Bonds) is registered at the close of
business on the Regular Record Date for such interest, which
shall be the February 6 or August 6 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment
Date. Except as otherwise provided in the Indenture, any such
interest not so punctually paid or duly provided for will cease
to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Bond (or one or
more Predecessor Bonds) is registered at the close of business on
a Special Record Date for the payment of such defaulted interest
to be fixed by the Trustee, notice whereof shall be given to the
Holders of Bonds of this series not less than 10 days prior to
such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any
securities exchange on which the Bonds of this series may be
listed, and upon such notice as may be required by such exchange,
all as more fully provided in the Indenture. Accrued but unpaid
interest on any Bond that is exchanged for a Series A-1 Bond
pursuant to the Registration Rights Agreement shall be paid on or
before the first Interest Payment Date on the Series A-1 Bonds.
Payment of the principal of and interest on this Bond will be
made at the corporate trust office of the Trustee, or such other
office or agency of Panda Funding as may be designated by it for
such purpose in such coin or currency of the United States of
America as at the time of payment shall be legal tender for the
payment of public and private debts; provided, however, that (a)
at the option of Panda Funding payment of interest may be made by
check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register, (b)
notwithstanding such election by Panda Funding, if a Holder of
$2,000,000 or more in aggregate principal amount (or such lesser
amount as results from all payments of principal and redemptions
in respect of a Bond in the original principal amount of
$2,000,000) of Bonds requests in writing, payments of money may
be made by wire transfer of immediately as available funds
pursuant to written wire transfer instructions delivered to the
Trustee on or before the applicable Regular Record Date.
Reference is made to the further provisions of this Bond set
forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Bond shall not
be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, Panda Funding has caused this
instrument to be duly executed.
PANDA FUNDING CORPORATION
By:
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This Bond is one of the series of Bonds referred to in the
within-mentioned Indenture.
Bankers Trust Company, as Trustee
By:
Authorized Signatory
[Form of Reverse of Bond]
This bond is one of an authorized issue of Bonds of Panda
Funding known as its 11 5/8% Pooled Project Bonds, Series A due
2012 (the "Bonds"). The Bonds are issued under the Trust
Indenture dated as of July 31, 1996 (the "Original Indenture")
among Panda Funding, Panda Interfunding Corporation, a Delaware
corporation ("PIC"), and Bankers Trust Company, a New York state
banking corporation, as trustee (in such capacity, together with
its successors in such capacity, the "Trustee"), as supplemented
by the First Supplemental Indenture dated as of July 31, 1996
(the "First Supplemental Indenture") to the Original Indenture
among Panda Funding, PIC and the Trustee (the Original Indenture,
as so supplemented and as the same may be further supplemented,
amended or modified, the "Indenture"). All capitalized terms used
herein, unless otherwise defined herein, shall have the meanings
ascribed to them in the Indenture.
All Bonds of any series issued and outstanding under the
Indenture rank on a parity with each other Bond of the same
series and with all Bonds of each other series. Reference is
hereby made to the Indenture for a description of the nature and
extent of the Bonds and the respective rights, limitations of
rights, duties and immunities thereunder of the Holders of the
Bonds and of the Trustee and Panda Funding and PIC in respect of
the Bonds and the terms upon which the Bonds are made and are to
be authenticated and delivered.
The principal of, and premium, if any, and interest on, this
Bond are (i) payable only from the revenues and assets of Panda
Funding, the Collateral and, through the PIC Guaranty, PIC and
the payments therefrom and the income and proceeds received by
the Trustee therefrom and (ii) secured by assets subject to the
Lien of the Security Documents, and all payments of principal and
interest shall be made in accordance with the terms of the Trust
Indenture.
The Bonds are subject to a Collateral Agency Agreement dated
as of July 31, 1996 pursuant to which the rights of the Secured
Parties (including the Holders of the Bonds) in respect of the
Collateral will be shared among the Secured Parties and will be
exercised by the Collateral Agent in accordance with the
Collateral Agency Agreement.
The Indenture permits, with certain exceptions, as therein
provided, the amendment thereof and the modification of the
rights and obligations of Panda Funding, PIC and the rights of
the Holders of the Bonds under the Indenture at any time by Panda
Funding and PIC with the consent of the Holders of not less than
a majority in aggregate principal amount of the Bonds of all
series then outstanding. The Indenture also contains provisions
permitting the Holders of specified percentages in aggregate
principal amount of the Bonds of all series then outstanding, on
behalf of the Holders of all the Bonds, to waive compliance by
Panda Funding or PIC with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences.
Any Act (as such term is defined in the Indenture), including,
but not limited to, such a consent, waiver or direction by the
Holder of this Bond shall be conclusive and binding upon the
Holder and upon all future Holders of this Bond and the Holder of
every Bond issued upon the transfer hereof or the exchange
therefor or in lieu hereof whether or not notation of such Act is
made upon this Bond.
This Bond is one of the series designated on the face
hereof, limited in aggregate principal amount of $105,525,000.
This Bond and all Bonds issued or to be issued in series created
under the First Supplemental Indenture are (i) not subject to any
sinking fund, (ii) are subject to optional redemption on the
terms set forth in Section 4.9 of the Original Indenture and
(iii) are, in accordance with the provisions of Article VIII of
the Original Indenture, subject to redemption by Panda Funding
prior to the Final Maturity Date, in whole or in part on any
Business Day on or after August 20, 2001, and if in part in
integral multiples of $1,000. Any such redemption shall be at the
redemption prices (expressed as percentages of principal amount)
set forth in the table below plus accrued interest, if any, to
the redemption date, if redeemed during the 12-month period
commencing on or after August 20 of years set forth below:
Year Redemption Price
2001 105.8125%
2002 104.3594%
2003 102.9063%
2004 101.4532%
2005 100.0000%
In the event of a Change of Control of PIC, and subject to
certain conditions and limitations provided in the Indenture,
Panda Funding will be obligated to make an offer to purchase, on
a Business Day not more than 60 nor less than 30 days following
the occurrence of a Change of Control of PIC, all of the then
Outstanding Bonds at a purchase price equal to 101% of the
principal amount thereof, together with accrued and unpaid
interest, if any, to the Change of Control Purchase Date, all as
provided in the Indenture.
The Bonds are, under certain conditions, subject to
mandatory redemption as set forth in Sections 4.8 and 8.3 of the
Original Indenture. Notice of any redemption of Bonds will be
given at least 30 days but not more than 60 days before the
Redemption Date to each Holder at its address as it appears in
the Security Register.
Bonds (or portions thereof as aforesaid) for the redemption
of which provision is made in accordance with the Indenture shall
cease to bear interest from and after any Redemption Date.
The Indenture contains provisions for, upon compliance by
Panda Funding with certain conditions set forth in the Indenture,
the defeasance of (a) the entire indebtedness of this Bond and
(b) certain restrictive covenants and agreements.
The unpaid portion of the Principal Amount, together with
any interest accrued and unpaid thereon and all other amounts due
hereunder, if any, may become due and payable upon the occurrence
and continuation of any Event of Default, but only as provided in
the Indenture.
The Holder hereof, by its acceptance of this Bond, agrees
that each payment received by it hereunder shall be applied in
the manner set forth in Section 2.16 of the Indenture relating to
the allocation of principal and interest.
The Bonds are issuable only as registered Bonds without
coupons in denominations of $100,000 (or such lesser principal
amount as results from all payments of principal and redemptions
in respect of a Bond in the original principal amount of
$100,000) and any integral multiple of $1,000 in excess thereof.
As provided in, and subject to the provisions of, the Indenture,
Bonds are exchangeable at the option of the Holder thereof for
other Bonds of the same series, of authorized denomination and of
like tenor and aggregate principal amount, to be registered in
the name of such Holder, upon surrender thereof by such Holder.
[If a Series A Bond -- At the option of the Holders thereof,
the Bonds may be exchanged pursuant to the Registration Rights
Agreement for a like aggregate principal amount of Series A-1
Bonds.]
No service charge will be required of any Holder of Bonds
participating in any such transfer or exchange of Bonds in
respect of such transfer or exchange, but the Security Registrar
may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.
Prior to due presentment of this Bond for registration of
transfer, the person in whose name this Bond is registered shall
be deemed to be the owner and holder thereof for the purpose of
receiving payment as herein provided and for all other purposes
whether or not this Bond be overdue regardless of any notice to
anyone to the contrary.
THE INDENTURE AND THIS BOND SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO THE CONFLICTS OF LAW RULES THEREOF, OTHER THAN
SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
PRINCIPAL PAYMENTS
Payment Date Percentage of Principal
February 20, 1997 0.2045%
August 20, 1997 0.0000%
February 20, 1998 0.0000%
August 20, 1998 0.0000%
February 20, 1999 0.0000%
August 20, 1999 0.5933%
February 20, 2000 0.6129%
August 20, 2000 0.0000%
February 20, 2001 0.0000%
August 20, 2001 1.3753%
February 20, 2002 1.4691%
August 20, 2002 2.2184%
February 20, 2003 2.3565%
August 20,2003 2.9328%
February 20, 2004 3.1031%
August 20,2004 3.2796%
February 20,2005 3.4687%
August 20,2005 3.5977%
February 20,2006 3.7820%
August 20,2006 2.8098%
February 20,2007 3.0076%
August 20,2007 4.8415%
February 20,2008 5.1145%
August 20,2008 5.0057%
February 20,2009 5.2949%
August 20,2009 5.5185%
February 20,2010 5.8300%
August 20,2010 5.7248%
February 20,2011 6.0590%
August 20,2011 6.4800%
February 20,2012 6.8808%
August 20,2012 8.4390%
PIC GUARANTY
To the extent and subject to the limitations set forth in
the Indenture, PIC (as defined in the Indenture referred to in
the Bond upon which this notation is endorsed, which term
includes any successor or permitted assigns under the Indenture)
has unconditionally guaranteed (a) the due and punctual payment
of the principal of (and premium, if any, on) and interest on the
Bonds, (b) the due and punctual payment of all other amounts due
and payable under the Indenture and the Bonds by Panda Funding,
and (c) the due and punctual performance of all other obligations
of Panda Funding to the Holders or the Trustee, all in accordance
with the terms set forth in the Indenture. Capitalized terms used
herein shall have the meanings assigned to them in the Indenture
unless otherwise indicated.
The obligations of PIC to the Holders of Bonds and to the
Trustee pursuant to the PIC Guaranty and the Indenture are
expressly set forth in the Indenture, including Article XIII
thereof, and reference is hereby made to the Indenture for the
precise terms of the PIC Guaranty.
PANDA INTERFUNDING CORPORATION
By:
ABBREVIATIONS
The following abbreviations when used in the inscription on the
face of this instrument shall be construed as though they were
written out in full according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT
(___________) (Minor)
under Uniform Gift to Minors Act
(State)
Additional abbreviations may also be used though not in the
above list FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s)
and transfer(s) unto
Tax Identification Number or Other
Identifying Number of Assignee
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
(Please print or typewrite name and address, including zip code
of Assignee)
the within Bond and all rights thereunder, hereby irrevocably
constituting and appointing ____________________________________
attorney to transfer said bond on the books of Panda Funding, with
full power of substitution in the premises.
Dated:
NAME:
NOTICE: The signature to this assignment must correspond with
the name as written upon the first page of the within instrument
in every particular, without alteration or enlargement or any
change whatsoever.
