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EXHIBIT 4.1
ENSTAR INC.
Subordinated Debentures
______________________
INDENTURE
Dated as of ______________________________ , 1996
National City Bank of Minneapolis
Trustee
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"CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
--------------- -----------------
310 (a)(1) 7.10
(a)(2) 7.10
(a)(3) N.A.
(a)(4) N.A.
(b) 7.08, 7.10; 11.02
(c) N.A.
311 (a) 7.11
(b) 7.11
(c) N.A.
312 (a) 2.06
(b) 11.03
(c) 11.03
313 (a) 7.06
(b)(l) N.A.
(b)(2) 7.06
(c) 11.02
(d) 7.06
314 (a) 4.02; 11.02
(b) N.A.
(c)(l) 11.04
(c)(2) 11.04
(c)(3) N.A.
(d) N.A.
(e) 11.05
(f) 4.03
315 (a) 7.01(b)
(b) 7.05; 11.02
(c) 7.01(a)
(d) 7.01(c)
(e) 6.11
316 (a) (last sentence) 2.10
(a)(l)(A) 6.05
(a)(l)(B) 6.04
(a)(2) N.A.
(b) 6.07
317 (a)(1) 6.08
(a)(2) 6.09
(b) 2.05
318 (a) 11.01
N.A. MEANS NOT APPLICABLE.
______________
* This Cross-Reference Table is not part of the Indenture.
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TABLE OF CONTENTS
Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions 1
SECTION 1.02 Other Definitions 2
SECTION 1.03 Incorporation by Reference of Trust Indenture Act 2
SECTION 1.04 Rules of Construction 3
ARTICLE TWO
THE SECURITIES
SECTION 2.01 Form and Dating 3
SECTION 2.02 Terms 3
SECTION 2.03 Execution and Authentication 4
SECTION 2.04 Registrar and Paying Agent 4
SECTION 2.05 Paying Agent to Hold Money in Trust 5
SECTION 2.06 Certificateholder Lists 5
SECTION 2.07 Transfer and Exchange 5
SECTION 2.08 Replacement Securities 5
SECTION 2.09 Outstanding Debentures 6
SECTION 2.10 Treasury Debentures 6
SECTION 2.11 Temporary Debentures 6
SECTION 2.12 Cancellation 6
SECTION 2.13 Default Interest 6
ARTICLE THREE
REDEMPTION
SECTION 3.01 Applicability of Article 7
SECTION 3.02 Notices to Trustee 7
SECTION 3.03 Selection of Debentures to Be Redeemed 7
SECTION 3.04 Notice of Redemption 7
SECTION 3.05 Effect of Notice of Redemption 8
SECTION 3.06 Deposit of Redemption Price 8
SECTION 3.07 Debentures Redeemed in Part 8
SECTION 3.08 Redemption Option upon Death or Disability of Holder 8
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ARTICLE FOUR
COVENANTS
SECTION 4.01 Payment of Debentures 9
SECTION 4.02 SEC Reports 9
SECTION 4.03 Compliance Certificate 9
SECTION 4.04 Usury Laws 10
SECTION 4.05 Money for Debenture Payments to Be Held in Trust 10
SECTION 4.06 Continued Existence 10
ARTICLE FIVE
SUCCESSORS
SECTION 5.01 When Company May Merge, Etc. 10
ARTICLE SIX
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default 10
SECTION 6.02 Acceleration 12
SECTION 6.03 Other Remedies 12
SECTION 6.04 Waiver of Past Defaults 12
SECTION 6.05 Control by Majority 12
SECTION 6.06 Limitation on Suits 13
SECTION 6.07 Rights of Holders to Receive Payment 13
SECTION 6.08 Collection Suit by Trustee 13
SECTION 6.09 Trustee May File Proofs of Claim 13
SECTION 6.10 Priorities 13
SECTION 6.11 Undertaking for Costs 14
ARTICLE SEVEN
TRUSTEE
SECTION 7.01 Duties of Trustee 14
SECTION 7.02 Rights of Trustee 15
SECTION 7.03 Individual Rights of Trustee 15
SECTION 7.04 Trustee's Disclaimer 15
SECTION 7.05 Notice of Defaults 15
SECTION 7.06 Reports by Trustee to Holders 16
SECTION 7.07 Compensation and Indemnity 16
SECTION 7.08 Replacement of Trustee 16
SECTION 7.09 Successor Trustee by Merger, etc. 17
SECTION 7.10 Eligibility; Disqualification 17
SECTION 7.11 Preferential Collection of Claims Against Company 17
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ARTICLE EIGHT
DISCHARGE OF INDENTURE
SECTION 8.01 Termination of Company's Obligations 18
SECTION 8.02 Application of Trust Money 18
SECTION 8.03 Repayment to the Company 18
ARTICLE NINE
AMENDMENTS
SECTION 9.01 Without Consent of Holders 19
SECTION 9.02 With Consent of Holders 19
SECTION 9.03 Compliance with Trust Indenture Act 20
SECTION 9.04 Revocation and Effect of Consents 20
SECTION 9.05 Notation on or Exchange of Debentures 20
SECTION 9.06 Trustee Protected 20
ARTICLE TEN
SUBORDINATION
SECTION 10.01 Agreement to Subordinate 20
SECTION 10.02 Certain Definitions 20
SECTION 10.03 Liquidation; Dissolution; Bankruptcy 21
SECTION 10.04 Default on Senior Indebtedness 21
SECTION 10.05 Acceleration of Debentures 22
SECTION 10.06 When Distribution Must be Paid Over 22
SECTION 10.07 Notice by Company 22
SECTION 10.08 Subrogation 22
SECTION 10.09 Relative Rights 23
SECTION 10.10 Subordination May Not Be Impaired by Company 23
SECTION 10.11 Distribution or Notice to Representative 23
SECTION 10.12 Rights of Trustee and Paying Agent 23
ARTICLE ELEVEN
MISCELLANEOUS
SECTION 11.01 Trust Indenture Act Controls 23
SECTION 11.02 Notices 24
SECTION 11.03 Communications by Holders with Other Holders 24
SECTION 11.04 Certificate and Opinion as to Conditions Precedent 24
SECTION 11.05 Statements Required in Certificate or Opinion 24
SECTION 11.06 Rules by Trustee and Agents 25
SECTION 11.07 Legal Holidays 25
SECTION 11.08 No Recourse Against Others 25
SECTION 11.09 Duplicate Originals 25
SECTION 11.10 Variable Provisions 25
SECTION 11.11 Governing Law 26
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SECTION 11.12 No Adverse Interpretation of Other Agreements 26
SECTION 11.13 Successors 26
SECTION 11.14 Severability 26
SIGNATURES 27
EXHIBIT A - FORM OF DEBENTURE
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INDENTURE dated as of__________________, between ENSTAR INC., a Minnesota
corporation ("Company"), and NATIONAL CITY BANK OF MINNEAPOLIS, a National
Banking Association ("Trustee").
Each party agrees as follows for the benefit of the other party and for
the equal and ratable benefit of the Holders of the Company's Subordinated
Debentures:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"Affiliate" means any person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Board of Directors" means the Board of Directors of the Company or any
authorized committee of the Board.
"Company" means the party named as such above until a successor replaces
it and thereafter means the successor or any other obliger with respect to the
Debentures.
"Company Order" means an order signed in the name of the Company by its
Chairman of the Board, President or a Vice President, and by its Treasurer, an
Assistant Treasurer, Controller, an Assistant Controller, Secretary or an
Assistant Secretary, and delivered to the Trustee.
"Date of Issue" means the date that the Company receives the funds for the
purchase of a Debenture if such funds are received prior to 3:00 p.m. on a
business day or the next business day if the Company receives such funds on a
non-business day or after 3:00 p.m. on a business day. For this purpose, the
Company's business days will be deemed to be Monday through Friday, except on
Minnesota legal holidays.
"Debentures" means the Subordinated Debentures described above issued
under this Indenture.
"Default" means any event which is, or after notice or passage of time
would be, an Event of Default.
"Holder" or "Certificateholder" means a person in whose name a Debenture
is registered.
"Indenture" means this Indenture as amended from time to time.
"Officers' Certificate" means a certificate signed by two officers of the
Company, one of whom must be the President, the Treasurer or a Vice-President
of the Company.
"Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee.
"person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
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"principal" of a debt security means the principal of the security plus
the premium, if any, on the security.
"SEC" means the Securities and Exchange Commission.
"Stated Maturity," when used with respect to a Debenture, means the date
specified in such Debenture as the fixed date on which the principal of such
Debenture and any accrued but unpaid interest is due and payable.
"subsidiary" means any person of which at least a majority of capital
stock having ordinary voting power for the election of directors or other
governing body of such person is owned by the Company directly or through one
or more subsidiaries.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code 77aaa-77bbbb) as
in effect on the date of execution of this Indenture.
"Trustee" means the party named as such above until a successor replaces
it and thereafter means the successor.
"Trust Officer" means the Chairman of the Board, the President or any
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
Section 1.02. Other Definitions.
Defined
in
Term Section
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"Additional Interest" 2.02(b)
"Bankruptcy Law" 6.01
"Custodian" 6.01
"Debt" 10.02
"Event of Default" 6.01
" Indebtedness" 10.01
"Legal Holiday" 11.07
"Officer" 11.10
"Representative" 10.02
"Senior Indebtedness" 10.02
"U.S. Government Obligations" 8.01
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Debentures;
"indenture security holder" means a Certificateholder;
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"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee;
"obligor" on the Debentures means the Company.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the
TIA have the meanings assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally
accepted accounting principles in effect on the
date of execution of this Indenture;
(3) "or" is not exclusive;
(4) words in the singular include the
plural, and in the plural include the singular; and
(5) provisions apply to successive events
and transactions.
ARTICLE 2
THE DEBENTURES
Section 2.01. Form and Dating.
The Debentures shall be substantially in the form of Exhibit A, with such
appropriate insertions, omissions, substitutions and other variations required
or permitted by this Indenture. The Debentures may have notations, legends or
endorsements required by law, stock exchange rule or usage.
Section 2.02. Terms.
(a) Amount Unlimited; Terms. The aggregate principal amount of Debentures
which may be authenticated and delivered under this Indenture is unlimited.
Debentures may be issued in one or more series. The initial aggregate
principal amount of the Debentures to be authenticated and delivered under this
Indenture shall be $10,000,000. The aggregate principal amount may be
increased, without the need for approval of any Holders of the Trustee by means
of Company Order, as set forth in Section 9.01.
(b) Interest. Subject to change by Company Order as provided herein,
interest on the Debentures shall be established initially by Company Order and
shall be payable at the rate set forth in such Company Order, until the
principal thereof is paid or made available for payment. After the date of the
Company Order, the rate of interest to be paid on the Debentures may be changed
from time to time by Company Order, provided that any change of interest rates
shall not alter the interest rate on Debentures issued prior to the effective
date of such Company Order. The Debentures shall bear
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interest from and commencing with their Date of Issue. In addition to the rate
of interest for the Debentures as set forth below, the Company shall be
obligated to make such additional payments of interest, premiums or other
benefits (referred to herein as "Additional Interest") on such of the
Debentures, in such amounts, in such form, on such terms and at such times as
shall be determined from time to time by Company Order, and the Company's
undertaking to pay such Additional Interest shall be an enforceable obligation
to the extent specified in the Company Order. Such Additional Interest payments
may be modified or discontinued at any time by Company Order.
(c) Denominations. The Debentures shall be issued in denominations of
$1,000 or greater.
(d) Subordination. The Debentures shall be subordinated and junior in
right of payment to all Senior Indebtedness of the Company as provided in
Article 10.
Section 2.03. Execution and Authentication.
Two Officers shall sign the Debentures for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Debenture no longer holds that
office at the time the Debenture is authenticated, the Debenture shall
nevertheless be valid.
A Debenture shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Debenture
has been authenticated under this Indenture.
The Trustee shall authenticate Debentures for original issue up to the
aggregate principal amount as stated in the Company Order upon receipt by the
Trustee of the Company Order. The aggregate principal amount of Debentures
outstanding at any time may not exceed that amount except as provided in
Section 2.08.
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Debentures. An authenticating agent may authenticate
Debentures whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same right as an Agent to deal with the Company or
an Affiliate.
Section 2.04. Registrar and Paying Agent.
The Company shall maintain an office or agency where Debentures may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Debentures may be presented for payment ("Paying
Agent"). The Registrar shall keep a register of the Debentures and of their
transfer and exchange. The Company may appoint one or more co-registrars and
one or more additional paying agents. The Company may change any Paying Agent,
Registrar or co-registrar without notice to any Certificateholder. The term
"Paying Agent" includes any additional paying agent. The Company shall notify
the Trustee of the name and address of any Agent not a party to this Indenture.
If the Company fails to appoint or maintain another entity as Registrar or
Paying Agent, the Trustee shall act as such. The Company or any of its
subsidiaries may act as Paying Agent or Registrar.
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Section 2.05. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust for the benefit of
Certificateholders or the Trustee all money held by the Paying Agent for the
payment of principal or interest on the Debentures, and will notify the Trustee
of any failure by the Company in making any such payment. While any such
failure continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. The Company at any time may require a Paying Agent to
pay all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent shall have no further liability for the money. If the Company
acts as Paying Agent, it shall segregate and hold in a separate trust fund for
the benefit of the Certificateholders all money held by it as Paying Agent.
The Paying Agent may charge for its expenses in issuing a replacement interest
check.
Section 2.06. Certificateholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Certificateholders. If the Trustee is not the Registrar, the Company shall
timely furnish to the Trustee the changes in this list and will furnish an
updated list of the names and addresses of Certificateholders in such form and
as of such date and at such other times as the Trustee may request in writing.
Section 2.07. Transfer and Exchange.
Where Debentures are presented to the Registrar or a co-registrar with a
request to register, transfer or to exchange them for an equal principal amount
of Debentures but of other denominations, the Registrar shall register the
transfer or make the exchange if its requirements for such transactions are
met, subject to the requirement that the Debentures be issued in denominations
of $1,000 or greater. To permit registrations of transfer and exchanges, the
Company shall issue and the Trustee shall authenticate Debentures at the
Registrar's request. The Company may charge for its expenses in transferring
or exchanging a Debenture.
The Company shall not be required (i) to issue, transfer or exchange any
Debenture during a period beginning at the opening of business 15 days before
the day of the mailing of a notice of redemption of Debentures selected for
redemption pursuant to Section 4.02 and ending at the close of business on the
day of such mailing, or (ii) to transfer or exchange any Debenture so selected
for redemption in whole or in part.
Section 2.08. Replacement Debentures.
If the Holder of a Debenture claims that the Debenture has been lost,
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Debenture if the Trustee's requirements are met. If
required by the Trustee or the Company, an indemnity bond must be sufficient in
the judgment of both to protect the Company, the Trustee, any Agent or any
authenticating agent from any loss which any of them may suffer if a Debenture
is replaced. The Trustee may waive such indemnity bond if so instructed by the
Company. The Company may charge for its expenses in replacing a Debenture.
Every replacement Debenture is an additional obligation of the Company.
Section 2.09. Outstanding Debentures.
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The Debentures outstanding at any time are all the Debentures
authenticated by the Trustee except for those canceled by it, those delivered
to it for cancellation, and those described in this Section as not outstanding.
If a Debenture is replaced pursuant to Section 2.08, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Debenture is held by a bona fide purchaser.
If Debentures are considered paid under Section 4.01, they cease to be
outstanding and interest on them ceases to accrue.
Section 2.10. Treasury Debentures.
In determining whether the Holders of the required principal amount of the
Debentures have concurred in any direction, waiver or consent, Debentures owned
by the Company or an Affiliate shall be disregarded, except that for the
purposes of determining whether the Trustee shall be protected in relying on
any such direction, waiver or consent, only Debentures which the Trustee knows
are so owned shall be so disregarded.
Section 2.11. Temporary Debentures.
Until definitive Debentures are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Debentures. Temporary
Debentures shall be substantially in the form of definitive Debentures but may
have variations that the Company considers appropriate. Without unreasonable
delay, the Company shall prepare and the Trustee shall authenticate definitive
Debentures in exchange for temporary Debentures.
Section 2.12. Cancellation.
The Company at any time may deliver Debentures to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Debentures surrendered to them for registration of transfer, exchange or
payment. The Trustee shall cancel all Debentures surrendered for registration
of transfer, exchange, payment, replacement or cancellation and shall dispose
of canceled Debentures as the Company directs. The Company may not issue new
Debentures to replace Debentures that it has paid or that have been delivered
to the Trustee for cancellation.
Section 2.13. Defaulted Interest.
If the Company fails to make a payment of interest on the Debentures, it
shall pay such interest thereafter in any lawful manner. It shall pay such
interest, plus any interest payable on it, to the persons who are
Certificateholders of Debentures on a subsequent special record date. The
Company shall fix the special record date and payment date. At least 15 days
before the special record date, the Company shall mail to Certificateholders of
Debentures a notice that states the special record date, payment date, and
amount of such interest to be paid.
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ARTICLE 3
REDEMPTION
Section 3.01 Applicability of Article.
Redemption of Debentures at the election of the Company, as permitted or
required by any provision of this Indenture, shall be made in accordance with
such provision and this Article.
Section 3.02. Notices to Trustee.
If the Company wants to redeem the Debentures pursuant to paragraph 5 of
the Debentures, it shall notify the Trustee by Officers' Certificate of the
redemption date and the principal amount of Debentures to be redeemed. The
Company shall give each notice provided for in this Section at least fifty days
before the redemption date.
Section 3.03. Selection of Debentures to Be Redeemed.
If fewer than all the Debentures are to be redeemed, the Company shall
select the Debentures to be redeemed by interest rate or maturity, and so
inform the Trustee by Officers' Certificate, subject to the remainder of this
section. If less than all of a grouping of Debentures, as specified by
Officers' Certificate, are to be redeemed, the portion thereof selected for
redemption shall be determined ratably or by lot. If fewer than all of such
grouping of Debentures as specified by Officers' Certificate are to be
redeemed, the Trustee shall then make the selection not more than 50 days
before the redemption date, from Debentures outstanding not previously called
for redemption. The Trustee may select for redemption portions of the
principal of Debentures that have denominations greater than $1,000.
Provisions of this Indenture that apply to Debentures called for redemption
also apply to portions of Debentures called for redemption. The Trustee shall
notify the Company promptly of the Debentures or portions of Debentures to be
called for redemption.
Section 3.04. Notice of Redemption.
At least 30 days but not more than 60 days before a redemption date, the
Company shall mail a notice of redemption by first-class mail to each Holder of
Debentures whose Debentures are to be redeemed.
The notice shall identify the Debentures to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Debentures called for redemption must be surrendered to the
Paying Agent to collect the redemption price; and
(5) that interest on Debentures called for redemption ceases to
accrue on and after the redemption date.
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At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at its expense.
Section 3.05. Effect of Notice of Redemption.
Once notice of redemption is mailed, Debentures called for redemption
become due and payable on the redemption date at the redemption price.
Section 3.06. Deposit of Redemption Price.
On or before the redemption date, the Company shall deposit with the
Paying Agent, or if the Company is acting as Paying Agent it shall deposit into
a separate trust account pursuant to Section 2.05 hereof, money sufficient to
pay the redemption price of and accrued interest on all Debentures to be
redeemed on that date. The Paying Agent shall return to the Company any money
not required for that purpose, within two years following the redemption date.
Section 3.07. Debentures Redeemed in Part.
Upon surrender of a Debenture that is redeemed in part, the Company shall
issue and the Trustee shall authenticate for the Holder a new Debenture equal
in principal amount to the unredeemed portion of the Debenture surrendered.
Section 3.08. Redemption Option upon Death of Holder.
(a) Subject to the provisions of Article Ten and this Article Three, upon
the death of any Holder of one or more Debentures the Company shall be required
to pay up to $25,000 aggregate principal amount of, without any premium,
together with interest accrued to the redemption date on, all or such part (in
integral multiples of $100 in excess of $1,000) of the Debentures held by the
Holder of such Debentures at the date of such Xxxxxx's death, as requested in
the manner, and subject to the limitations, set forth below. Redemption of
such Debentures shall be made within 30 days following the receipt by the
Company or the Trustee of all of the following:
(1) a written request for redemption of the Debentures signed by a duly
authorized representative of the Holder, which request shall set forth the name
of the Holder, the date of death of the Holder and the principal amount of the
Debentures to be redeemed;
(2) the Debentures to be redeemed; and
(3) evidence satisfactory to the Trustee and the Company of the death of
such Xxxxxx and the authority of the representative to such extent as may be
required by the Trustee or Company.
(b) The Debentures held by the Holder shall not be entitled to redemption
pursuant to this Section unless all of the following conditions are met:
(1) the Debentures to be redeemed have been registered in the Holder's
name since their Date of Issue; and
(2) either the Company or the Trustee has been notified in writing of the
request for redemption within 180 days after the date of the Holder's death.
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(c) Authorized representatives of a Holder shall include the following:
executors, administrators or other legal representatives of an estate; trustees
of a trust; joint owners of Debentures owned in joint tenancy or tenancy by the
entirety; attorneys-in-fact; and other persons generally recognized as having
legal authority to act on behalf of another.
(d) If two or more persons are joint record holders of a Debenture, the
election to redeem will not apply until all record holders are deceased, except
that, if the joint holders are husband and wife, the election may be made after
the death of either spouse.
(e) The redemption of Debentures pursuant to this Section 3.08 shall be
made according to the terms of Sections 3.06 and 3.07 herein.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Debentures.
The Company shall pay the principal of and interest on the Debentures on
the dates and in the manner provided in the Debentures. Principal and interest
shall be considered paid on the date due if the Paying Agent holds on that
date money designated for and sufficient to pay all principal and interest
then due.
The Company shall pay interest on overdue principal at the rate borne by
the Debentures; it shall pay interest on overdue installments of interest at
the same rate to the extent lawful.
Section 4.02. SEC Reports.
The Company shall file with the Trustee within 15 days after it files them
with the SEC copies of the annual reports and of the information, documents,
and other reports (or copies of such portions of any of the foregoing as the
SEC may by rules and regulations prescribe) for the Debentures which the
Company may be required to file with the SEC pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934, as amended. The Company also shall comply
with the other provisions of TIA Section 314(a).
Section 4.03. Compliance Certificate.
The Company shall deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company, an Officers' Certificate stating that a review
of the activities of the Company and its subsidiaries during the preceding
fiscal year has been made under the supervision of the signing Officers with a
view to determining whether the Company has kept, observed, performed and
fulfilled its obligations under this Indenture, and further stating, as to each
such Officer signing such certificate, that to the best of his or her knowledge
the Company has kept, observed, performed and fulfilled each and every covenant
contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions hereof (or, if a
Default or Event of Default shall have occurred, describing all such Defaults
or Events of Default of which he or she may have knowledge) and that to the
best of his or her knowledge no event has occurred and remains in existence by
reason of which payments on account of the principal of or interest, if any, on
the Debentures are prohibited. See Section 11.10.
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Section 4.04. Usury Laws.
The Company will not voluntarily claim and will actively resist any
attempts to claim the benefit of any usury laws against the Holders of the
Debentures.
Section 4.05. Money for Debenture Payments to Be Held in Trust.
Whenever the Company shall have one or more Paying Agents, it will, on or
prior to each date for the payment of the principal of or interest on the
Debentures, deposit with a Paying Agent a sum sufficient to pay the principal
or interest so becoming due, such sum to be held in trust for the benefit of
the persons entitled to such payments; and, unless such Paying Agent is the
Trustee, the Company will promptly notify the Trustee of its action or failure
so to act.
The Company will cause each Paying Agent other than the Trustee to execute
and deliver to the Trustee an instrument in which such Paying Agent shall
agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of or
interest on the Debentures in trust for the benefit of the persons
entitled thereto until such sums shall be paid to such persons or
otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Debentures) in the making of any payment of
principal or interest; and
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent.
For the purpose of obtaining the satisfaction and discharge of this
Indenture or for any other purpose, the Company may at any time pay, or direct
any Paying Agent to pay, to the Trustee all sums held in trust by the Company
or such Paying Agent, such sums to be held by the Trustee upon the same terms
as those upon which such sums were held by the Company or such Paying Agent;
and, upon such payment by the Company or any Paying Agent to the Trustee, the
Company or such Paying Agent, as the case may be, shall be released from all
further liability with respect to such money.
Section 4.06. Continued Existence.
Subject to Article 5, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence as a
corporation.
ARTICLE 5
SUCCESSORS
Section 5.01. When Company May Merge, Etc.
The Company shall not consolidate or merge with or into, or transfer or
lease all or substantially all of its assets to, any corporation, person or
entity person unless the corporation formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale or
conveyance shall have been made, assumes by supplemental indenture all the
obligations of the Company under the Debentures then outstanding and this
Indenture.
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The Company shall deliver to the Trustee prior to the proposed transaction
an Officers' Certificate to the foregoing effect and an Opinion of Counsel
stating that the proposed transaction and such supplemental indenture comply
with this Indenture.
The surviving corporation shall be the successor Company, but the
predecessor Company in the case of a transfer or lease shall not be released
from the obligation to pay the principal of and interest on the Debentures.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(1) the Company defaults in the payment of interest on any Debenture
when the same becomes due and payable and the Default continues for a
period of 30 days;
(2) the Company defaults in the payment of the principal of any
Debenture when the same becomes due and payable at maturity, upon
redemption or otherwise, which default has not been cured;
(3) the Company fails to comply with any of its other agreements or
covenants in, or provisions of, the Debentures or this Indenture and the
Default continues for the period and after the notice specified below;
(4) the Company or any material subsidiary pursuant to or within the
meaning of any Bankruptcy Law:
(A) commences a voluntary proceeding under any such Bankruptcy
Law,
(B) consents to the entry of an order for relief against it in
an involuntary Bankruptcy proceeding,
(C) consents to the appointment of a Custodian of it or for
all or substantially all of its property,
(D) makes a general assignment for the benefit of its creditors,
or
(E) generally is unable to pay its debts as the same become due;
(5) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any material subsidiary
in an involuntary Bankruptcy proceeding,
(B) appoints a Custodian of the Company or any material
subsidiary or for all or substantially all of its property, or
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(C) orders the liquidation of the Company or any material
subsidiary, and the order or decree remains unstayed and in effect
for 60 days;
(6) the maturity of any Senior Indebtedness in an amount exceeding
$500,000 is accelerated under the terms of the instrument under which
such Senior Indebtedness is outstanding, if such acceleration is not
annulled within 30 days after written notice.
The term "Bankruptcy Law" means title 11, U.S. Code or any similar
Federal or State Law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
A Default under clause (3) is not an Event of Default until the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Debentures notify the Company of the Default and the Company does
not cure the Default within 60 days after receipt of the notice. The notice
must specify the Default, demand that it be remedied and state that the notice
is a "Notice of Default."
Section 6.02. Acceleration.
If an Event of Default occurs and is continuing, the Trustee by
notice to the Company, or the Holders of at least 25% in principal amount of
the then outstanding Debentures, by notice to the Company and the Trustee, may
declare the principal of and accrued interest on all the Debentures to be due
and payable. Upon such declaration the principal and interest owing on the
then outstanding Debentures shall be due and payable immediately. The Holders
of a majority in principal amount of the then outstanding Debentures, by
notice to the Trustee, may rescind an acceleration and its consequences if
the rescission would not conflict with any judgment or decree and if all
existing Events of Default have been cured or waived, except nonpayment of
principal or interest that has become due solely because of the acceleration.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal or interest on
the Debentures or to enforce the performance of any provision of the
Debentures or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Debentures or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder of Debentures in exercising any
right or remedy accruing upon an Event of Default shall not impair the right
or remedy or constitute a waiver of or acquiescence in the Event of Default.
All remedies are cumulative to the extent permitted by law.
Section 6.04. Waiver of Past Defaults.
The Holders of a majority in principal amount of the then outstanding
Debentures, by notice to the Trustee, may waive an existing Default or Event of
Default and its consequences except a continuing Default or Event of Default in
the payment of the principal of or interest on the Debentures.
Section 6.05. Control by Majority.
The Holders of a majority in principal amount of the then outstanding
Debentures may 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. However, the Trustee may refuse to follow any
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direction that conflicts with law or this Indenture, is unduly prejudicial to
the rights of other Holders of the Debentures, or would involve the Trustee in
personal liability.
Section 6.06. Limitation on Suits.
The Holder of Debentures may pursue a remedy with respect to this
Indenture or the Debentures only if:
(1) the Holder gives to the Trustee notice of a continuing Event of
Default;
(2) the Holders of at least 25% in principal amount of the then
outstanding Debentures make a request to the Trustee to pursue the
remedy;
(3) such Holder or Holders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and
(5) during such 60-day period the Holders of a majority of principal
amount of the then outstanding Debentures do not give the Trustee a
direction inconsistent with the request.
A Certificateholder may not use this Indenture to prejudice the
rights of another Holder of the Debentures or to obtain a preference or
priority over another Holder of the Debentures.
Section 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Debenture to receive payment of principal and interest on the
Debenture, on or after the respective due dates expressed in the Debenture, or
to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of the
Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs
and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount of
principal and interest remaining unpaid on the Debentures with respect to which
the Event of Default occurred.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may 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 and the Certificateholders allowed in any judicial proceedings
relative to the Company, its creditors or its property.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it
shall pay out the money in the following order:
First: to the Trustee for amounts due under Section 7.07;
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Second: to holders of Senior Indebtedness to the extent required by
Article 10;
Third: to Holders of Debentures for amounts due and unpaid on the
Debentures for principal and interest, ratably, without
preference or priority of any kind, according to the
amounts due and payable on the Debentures for principal and
interest, respectively; and
Fourth: to the Company.
The Trustee may fix a record date and payment date for any payment to
Certificateholders.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made
by the party litigant. This Section does not apply to a suit by the Trustee, a
suit by a Holder pursuant to Section 6.07, or a suit by Holders of more than
10% in principal amount of the then outstanding Debentures.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and power vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture and no others.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements of this
Indenture. However, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the requirements of
this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section.
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(2) The Trustee shall not be liable for any error of judgment made
in good faith by a Trust Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee may refuse to perform any duty or exercise any right or
power unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree with the Company. Money held in trust by
the Trustee need not be segregated from the other funds except to the extent
required by law.
Section 7.02. Rights of Trustee.
(a) The Trustee may rely on any document believed by it to be genuine and
to have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
the Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Debentures and may otherwise deal with the Company or an
Affiliate with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. However, the Trustee is subject to Sections
7.10 and 7.11.
Section 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Debentures, it shall not be accountable for the Company's use
of the proceeds from the Debentures, and it shall not be responsible for any
statement in the Debentures other than its authentication.
Section 7.05. Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders of the Debentures a
notice of the Default or Event of Default within 90 days after it occurs.
Except in the case of a Default or Event of Default in payment on a Debenture,
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the Trustee may withhold the notice if and so long as a committee of its Trust
Officers in good faith determines that withholding the notice is in the
interests of Holders of the Debentures.
Section 7.06. Reports by Trustee to Holders.
Within 60 days after the reporting date stated in Section 11.10, the
Trustee shall mail to Certificateholders a brief report dated as of such
reporting date that complies with TIA 313(a). The Trustee also shall comply
with TIA 313(b)(2).
A copy of each report at the time of its mailing to Certificateholders
shall be filed with the SEC and each stock exchange on which the Debentures are
listed. The Company shall notify the Trustee when the Debentures are listed on
any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred by it. Such expenses shall include the reasonable compensation and
out-of-pocket expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any loss or liability
incurred by it except as set forth in the next paragraph. The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity. The
Company shall defend the claim and the Trustee shall cooperate in the defense.
The Trustee may have separate counsel and the Company shall pay the reasonable
fees and expenses of such counsel. The Company need not pay for any settlement
made without its consent, which consent shall not be unreasonably withheld.
The Company need not reimburse any expense or indemnify against any
loss or liability incurred by the Trustee through negligence or bad faith.
To secure the Company's payment of obligations in this Section, the
Trustee shall have a lien prior to the Debentures on all money or property held
or collected by the Trustee, including that held in trust to pay principal and
interest on the Debentures.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(4) or (5) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
Section 7.08. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign by so notifying the Company. The Trustee may
be removed with respect to the Debentures by the Holders of a majority in
principal amount of the then outstanding Debentures by so notifying the Trustee
and the Company. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
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(2) the Trustee is adjudged a bankrupt or an insolvent or any order
for relief is entered with respect to the Trustee under any Bankruptcy Law;
(3) a Custodian or public officer takes charge of the Trustee or its
property;
(4) the Trustee becomes incapable of action; or
(5) in the judgment of the Company, comparable services are
available from another entity qualifying under Section 7.10 at a materially
lower cost to the Company.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, a successor
Trustee may be appointed by act of the Holders of a majority in principal amount
of the then outstanding Debentures to replace the successor Trustee appointed by
the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the then outstanding Debentures
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10, any Holder of the
Debentures may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to the Holders of Debentures. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, subject to
the lien provided for in Section 7.07.
Section 7.09. Successor Trustee by Xxxxxx, etc.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to another corporation, the
successor corporation without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA 310(a)(1). The Trustee shall always have a combined capital
and surplus as stated in Section 11.10. The Trustee is subject to TIA 310(b).
Section 11.10 lists any excluded indenture or trust agreement.
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee is subject to TIA 311(a), excluding any creditor
relationship described in TIA 311(b). A Trustee who has resigned or been
removed shall be subject to TIA 311(a) to the extent indicated therein.
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ARTICLE 8
DISCHARGE OF INDENTURE
Section 8.01. Termination of Company's Obligations.
This Indenture shall cease to be of further effect (except that the
Company's obligations under Sections 7.07 and 8.03 shall survive) when all
outstanding Debentures theretofore authenticated and issued have been delivered
to the Trustee for cancellation. In addition, the Company may terminate its
obligations under this Indenture if:
(a) The Debentures then outstanding mature within one year or all of
the Debentures then outstanding are to be called for redemption within one year
under arrangements satisfactory to the Trustee for giving the notice of
redemption; and
(b) The Company irrevocably deposits in trust with the Trustee money
or U.S. Government Obligations sufficient to pay principal and interest on the
Debentures then outstanding to maturity or redemption, as the case may be. The
Company may make the deposit only during the one-year period and only if Article
11 permits it.
However, the Company's obligations in Sections 2.04, 2.05, 2.06, 2.07,
2.08, 4.01, 6.07, 6.08 and 8.03, and in Article 10, shall survive until no
Debentures are outstanding. Thereafter, only the Company's obligations in
Sections 7.07 and 8.03 shall survive.
If a deposit is made pursuant to this Section 8.01, the Trustee upon
request shall acknowledge in writing the discharge of the Company's obligations
under this Indenture, except for those surviving obligations specified above.
In order to have money available on a payment date to pay principal or
interest on the Debentures, the U.S. Government Obligations shall be payable as
to principal or interest on or before such payment date in such amounts as will
provide the necessary money. U.S. Government Obligations shall not be callable
at the issuer's option.
"U.S. Government Obligations" means direct obligations of the United
States of America for the payment of which the full faith and credit of the
United States of America is pledged.
Section 8.02. Application of Trust Money.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to Section 8.01. It shall apply the deposited money
and the money from U.S. Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal and interest on the
Debentures. Money and Debentures so held in trust are not subject to Article
10.
Section 8.03. Repayment to the Company.
The Trustee and the Paying Agent shall promptly pay to the Company
upon request any money or Debentures held by them at any time in excess of
amounts required to be so held hereunder.
The Trustee and the Paying Agent shall pay to the Company upon request
any money held by them for the payment of principal or interest that remains
unclaimed for two years. After
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payment to the Company, Certificateholders entitled to the money must look to
the Company for payment as general creditors unless an applicable abandoned
property law designates another person.
ARTICLE 9
AMENDMENTS
Section 9.01. Without Consent of Holders.
The Company and the Trustee may amend this Indenture or the Debentures
without the consent of the Holders of the Debentures by Company Order:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Section 5.01;
(3) to provide for uncertificated Debentures in addition to
certificated Debentures;
(4) to increase the aggregate principal amount of Debentures which
may be authenticated and delivered under this Indenture.
(5) to make any change that does not adversely affect the legal
rights hereunder of the Holders of the Debentures.
Section 9.02. With Consent of Holders.
The Company and the Trustee may amend this Indenture or the
Debentures with the written consent of the Holders of at least a majority in
principal amount of the then outstanding Debentures. However, without the
consent of each Certificateholder affected, an amendment under this Section may
not:
(1) reduce the amount of Debentures whose Holders must consent to
an amendment;
(2) reduce the rate of or change the time for payment of interest,
including default interest, on any issued and authenticated
Debenture;
(3) reduce the principal of or change the fixed maturity of any
Debenture;
(4) make any Debenture payable in money other than that stated in
such Debenture;
(5) make any change in Section 6.04, 6.07 or 9.02 (second
sentence);
(6) make any change in Article 10 that adversely affects the
rights of any Certificateholder.
An amendment under this Section may not make any change that adversely
affects the rights under Article 10 of any holder of an issue of Senior
Indebtedness unless the holders of the issue pursuant to its terms consent to
the change or the change is otherwise permissible.
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After an amendment under this Section becomes effective, the Company
shall mail to the Holders of the Debentures affected by such amendment a notice
briefly describing the amendment.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment to this Indenture or the Debentures shall be set forth
in a supplemental indenture that complies with the TIA as then in effect.
Section 9.04. Revocation and Effect of Consents.
Until an amendment or waiver becomes effective, a consent to it by a
Holder of a Debenture is a continuing consent by the Holder and every subsequent
Holder of a Debenture or portion of a Debenture that evidences the same debt as
the consenting Xxxxxx's Debenture, even if notification of the consent is not
made on any Debenture. However, any such Holder or subsequent Holder may revoke
the consent as to his or her Debenture or portion of a Debenture if the Trustee
receives the notice of revocation before the date the amendment or waiver
becomes effective. An amendment or waiver becomes effective in accordance with
its terms and thereafter binds every Holder of the Debentures.
Section 9.05. Notation on or Exchange of Debentures.
The Trustee may place an appropriate notation about an amendment or
waiver on any Debenture thereafter authenticated. The Company in exchange for
all Debentures may issue and the Trustee shall authenticate new Debentures that
reflect the amendment or waiver.
Section 9.06. Trustee Protected.
The Trustee shall sign all supplemental indentures, except that the
Trustee need not sign any supplemental indenture that adversely affects its
rights.
ARTICLE 10
SUBORDINATION
Section 10.01. Agreement to Subordinate
The Company agrees, and each Certificateholder by accepting a
Debenture agrees, that the indebtedness evidenced by the Debentures is
subordinated in right of payment, to the extent and in the manner provided in
this Article, to the prior payment in full of all Senior Indebtedness, and that
the subordination is for the benefit of the holders of Senior Indebtedness.
Section 10.02. Certain Definitions.
"Indebtedness" means any indebtedness, contingent or otherwise, in
respect of borrowed money (whether or not the recourse of the lender is to the
whole of the assets of the Company or only to a portion thereof), or evidenced
by bonds, notes, debentures or similar instruments or letters of credit, or
representing the balance deferred and unpaid on the purchase price of any
property or interest therein, except any such balance that constitutes a trade
payable.
"Representative" means the indenture trustee or other trustee, agent
or representative for an issue of Senior Indebtedness.
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"Senior Indebtedness" means all Indebtedness (present or future)
created, incurred, assumed or guaranteed by the Company (and all renewals,
extensions or refundings thereof), except such Indebtedness that by its terms
expressly provides that such Indebtedness is not senior or superior in right of
payment to the Debentures. Senior Indebtedness shall include the indebtedness
of North Star Universal, Inc. under that certain Indenture dated December 1,
1986 (the "1986 Indenture") between North Star Universal, Inc. and the Trustee,
and that certain Indenture dated March 16, 1989 (the "1989 Indenture"), as
supplemented on March 16, 1992 and March 16, 1995, between North Star Universal,
Inc. and the Trustee, all of which indebtedness was assumed by the Company
pursuant to supplemental indentures, dated November ___, 1996, to the 1986
Indenture and the 1989 Indenture, respectively, among the Company, North Star
Universal, Inc. and the Trustee. Notwithstanding anything herein to the
contrary, Senior Indebtedness shall not include debt of the Company to any of
its subsidiaries.
A distribution may consist of cash, Debentures or other property.
Section 10.03. Liquidation; Dissolution; Bankruptcy.
Upon any distribution to creditors of the Company in a liquidation or
dissolution of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its property:
(1) holders of Senior Indebtedness shall be entitled to receive
payment in full in cash of the principal and interest (including interest
accruing after the commencement of any such proceeding) to the date of
payment, on the Senior Indebtedness before Certificateholders shall be
entitled to receive any payment of principal or interest on Debentures; and
(2) until the Senior Indebtedness is paid in full in cash, any
distribution to which Certificateholders would be entitled but for this
Article shall be made to holders of Senior Indebtedness as their interest
may appear, except that Holders of Debentures may receive Debentures that
are subordinated to Senior Indebtedness to at least the same extent as such
Debentures.
Section 10.04. Default on Senior Indebtedness.
Upon the maturity of any Senior Indebtedness by lapse of time,
acceleration or otherwise, all such Senior Indebtedness shall first be paid in
full, or such payment duly provided for in cash or in a manner satisfactory to
the holders of such Senior Indebtedness, before any payment is made by the
Company or any person acting on behalf of the Company on account of the
principal or interest on the Debentures.
The Company may not pay principal or interest on the Debentures and
may not acquire Debentures for cash or property other than capital stock of the
Company if:
(1) a default on Senior Indebtedness occurs and is continuing that
permits holders of such Senior Indebtedness to accelerate its maturity, and
(2) the default is the subject of judicial proceedings or the
Company receives a notice of the default from a person who may give it
pursuant to Section 10.12. If the Company receives any such notice, a
similar notice received within nine months thereafter relating to the same
default on the same issue of Senior Indebtedness shall not be effective for
purposes of this Section.
The Company may resume payments on the Debentures and may acquire them
when:
(a) the default is cured or waived, or
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(b) 120 days pass after the notice is given if the default is not the
subject of judicial proceedings, if this Article otherwise permits the payment
or acquisition at that time.
Section 10.05. Acceleration of Debentures.
If payment of the Debentures is accelerated because of an Event of
Default, the Company shall promptly notify holders of Senior Indebtedness of
the acceleration. The Company may pay Holders of the Debentures when 120 days
pass after the acceleration occurs if this Article permits the payment at that
time.
Section 10.06. When Distribution Must be Paid Over.
In the event that, notwithstanding the provisions of Section 10.04, the
Company shall make any payment to the Trustee on account of the principal or
interest on the Debentures, after the happening of a default in payment of the
principal or interest on Senior Indebtedness, or after receipt by the Company
and the Trustee of written notice as provided in Sections 10.04 and 10.12 of an
Event of Default or an event which, with the passage of time or the giving of
notice or both, would constitute an Event of Default with respect to any Senior
Indebtedness, then, unless and until such Default or Event of Default shall
have been cured or waived or shall have ceased to exist, such payment shall be
held by the Trustee, in trust for the benefit of, and shall be paid forthwith
over and delivered to, the holders of Senior Indebtedness (pro rata as to each
of such holders on the basis of the respective amounts of Senior Indebtedness
held by them) or their representative or the trustee under the indenture or
other agreement (if any) pursuant to which Senior Indebtedness may have been
issued, as their respective interests may appear, for application to the
payment of all Senior Indebtedness remaining unpaid to the extent necessary to
pay all Senior Indebtedness in full in accordance with its terms, after giving
effect to any concurrent payment or distribution to or for the holders of
Senior Indebtedness.
If a distribution is made to the Holders of Debentures that because of
this Article should not have been made to them, the Holders who receive the
distribution shall hold it in trust for holders of Senior Indebtedness and pay
it over to them as their interests may appear.
Section 10.07. Notice by Company.
The Company shall promptly notify the Trustee and the Paying Agent of any
facts known to the Company that would cause a payment of principal or interest
on the Debentures to violate this Article, but failure to give such notice
shall not affect the subordination of the Debentures to the Senior Indebtedness
provided in this Article. Nothing in this Article 10 shall apply to claims of,
or payments to, the Trustee under or pursuant to Section 6.07.
Section 10.08. Subrogation.
After all Senior Indebtedness is paid in full and until the Debentures are
paid in full, Holders of the then outstanding Debentures shall be subrogated to
the rights of holders of Senior Indebtedness to receive distributions
applicable to Senior Indebtedness to the extent distributions otherwise payable
to such Holders have been applied to the payment of Senior Indebtedness. A
distribution made under this Article to holders of Senior Indebtedness which
otherwise would have been made to Certificateholders is not, as between the
Company and Certificateholders, a payment by the Company on Senior
Indebtedness.
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Section 10.09. Relative Rights.
This Article defines the relative rights of Certificateholders and holders
of Senior Indebtedness. Nothing in this indenture shall:
(1) impair, as between the Company and Certificateholders, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Debentures in accordance with their
terms;
(2) affect the relative rights of Certificateholders and creditors
of the Company other than holders of Senior Indebtedness; or
(3) prevent the Trustee or any Certificateholder from exercising its
available remedies upon a Default or Event of Default, subject to the
rights of holders of Senior Indebtedness to receive distributions
otherwise payable to Certificateholders.
If the Company fails because of this Article to pay principal or interest
on a Debenture on the due date, the failure is still a Default or Event of
Default.
Section 10.10. Subordination May Not Be Impaired by Company.
No right of any holder of Senior Indebtedness to enforce the subordination
of the indebtedness evidenced by the Debentures shall be impaired by any act or
failure to act by the Company or by its failure to comply with this Indenture.
Section 10.11. Distribution or Notice to Representative.
Whenever a distribution is to be made or a notice given to holders of
Senior Indebtedness, the distribution may be made and the notice given to their
Representative.
Section 10.12. Rights of Trustee and Paying Agent.
The Trustee or Paying Agent may continue to make payments on the
Debentures until it receives notice of facts that would cause a payment of
principal or interest on the Debentures to violate this Article. Only the
Company, a Representative or a holder of an issue of Senior Indebtedness that
has no Representative may give the notice.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights.
ARTICLE 11
MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies, or conflicts with
another provision which is required to be included in this Indenture by the
TIA, the required provision shall control.
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Section 11.02. Notices.
Any notice by the Company or the Trustee to the other is duly given if in
writing and delivered in person or mailed by first-class mail to the other's
address stated in Section 11.10. The Company or the Trustee by notice to the
other may designate additional or different addresses for subsequent notices or
communications.
Any notice to a Certificateholder shall be mailed by first-class mail to
the address shown on the register kept by the Registrar or such other name and
addresses as provided to Trustee pursuant to TIA 313(c)(2) and (3). Failure to
mail a notice or communication to a Certificateholder or any defect in it shall
not affect its sufficiency with respect to other Certificateholders.
If a notice is mailed in the manner provided above within the time
prescribed, it is duly given, whether or not the addressee receives it.
It the Company mails a notice to Certificateholders, it shall mail a copy
to the Trustee and each Agent at the same time.
All other notices shall be in writing.
Section 11.03. Communication by Holders with Other Holders.
Certificateholders may communicate pursuant to TIA 312(b) with other
Certificateholders with respect to their rights under this Indenture or the
Debentures. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA 312(c).
Section 11.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) 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
(b) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
Section 11.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include:
(1) a statement 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;
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(3) a statement that, in the opinion of such person, he or she has
made such examination or investigation as is necessary to enable him or
her 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 11.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or a meeting of
Certificateholders. The Registrar or Paying Agent may make reasonable rules
and set reasonable requirements for its functions.
Section 11.07. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions are not required to be open. If a payment date is a Legal Holiday
at a place of payment, payment may be made at that place on the next succeeding
day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
Section 11.08. No Recourse Against Others.
All liability described in the Debentures of any director, officer,
employee or stockholder, as such, of the Company is waived and released.
Section 11.09. Duplicate Originals.
The parties may sign any number of copies of this Indenture. One signed
copy is enough to prove this Indenture.
Section 11.10. Variable Provisions.
"Officer" means the President, any Vice President, the Treasurer, the
Secretary, any Assistant Treasurer or any Assistant Secretary of the Company.
The Company initially appoints itself as Paying Agent and Registrar.
The first certificate pursuant to Section 4.03 shall be for the fiscal
year ending on December 31, 1996.
The reporting date for Section 7.06 is May 15 of each year. The first
reporting date is May 15, 1997.
The trustee shall always have a combined capital and surplus of at least
$10,000,000 as set forth in its most recent published annual report of
conditions.
The Company's address is:
ENSTAR INC.
0000 Xxxx Xxxx Xxxxxxx
Xxxx Xxxxxxx, Xxxxxxxxx 00000
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The Trustee's address is:
651 Nicollet Mail
Minneapolis, Minnesota 55402
Attention: Corporate Trust Department
Section 11.11. Governing Law.
The internal laws of the State of Minnesota shall govern this Indenture
and the Debentures.
Section 11.12. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or a subsidiary. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.
Section 11.13. Successors.
All agreements of the Company in this Indenture and the Debentures shall
bind its successor. All agreements of the Trustee in this Indenture shall bind
its successor.
Section 11.14. Severability.
In case any provision in this Indenture or the Debentures shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
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SIGNATURES
Dated: as of ENSTAR INC.
By_______________________________
Its______________________________
Attest:
___________________________________
Dated: as of NATIONAL CITY BANK OF MINNEAPOLIS
By_______________________________
Its______________________________
Attest:
___________________________________
Trust Officer
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EXHIBIT A
ENSTAR SUBORDINATED DEBENTURE
[ ] Two Year [ ] Five Year [ ] Ten Year Subordinated Debenture(s)
Security # ____________________________ Holders (s):
Date of Issue __________________________________
Stated Maturity __________________________________
Principal Amount __________________________________ $______________________
Interest Rate _________________% Interest Payment Date(s):__________
Interest Payment Method
[ ] Quarterly [ ] Monthly [ ] At Maturity (Compounded Qtrly)
ENStar Inc., a Minnesota corporation (herein called the "Company"),
for value received, hereby promises to pay to the Holder or registered assigns,
the Principal Amount on the Stated Maturity and to pay interest thereon from
the Date of Issue, or from the most recent Interest Payment Date to which
interest has been duly provided for, on each Interest Payment Date at the
Interest Rate, until the principal hereof is paid or made available for
payment. Interest will be calculated based on a 365-day year. The interest
so payable, on any Interest Payment Date will, except as provided in the
Indenture referred to below and on the reverse hereof, be paid to the person in
whose name this Debenture is registered at the close of business on the 15th
calendar day prior to such Interest Payment Date whether or not such day is a
business day.
Reference is made to the further provisions of this Debenture set
forth below and on the reverse hereof. Such further provisions shall for all
purposes have the same effect as though fully set forth at this place.
Dated:
National City Bank of Minneapolis, as Trustee ENStar Inc.
Authenticated by: _____________________ By: ____________ ____________
Authorized Signature President Secretary
35
1. Indenture. This Debenture is one debenture in a series of
Debentures issued under an Indenture dated as of _______________________,
1996 ("Indenture") between the Company and National City Bank of Minneapolis,
as trustee (the "Trustee"). The terms of the Debentures include those stated
in the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 as amended by the Trust Indenture Reform Act of 1990 (15
U.S. Code 77aa-77bbbb) as in effect on the date of the Indenture. The
Debentures are subject to all such terms and Holders of the Debentures are
referred to the Indenture and the Act for a statement of such terms. The
Debentures are unsecured general obligations of the Company. The aggregate
principal amount of Debentures that may be issued under the Indenture is
unlimited.
2. Method of Payment. The Company will pay interest on the
Debentures (except defaulted interest) to the persons who are registered
Holders of Debentures at the close of business on the record date for the next
interest payment date even though Debentures are canceled after the record date
and on or before the interest payment date. Holders must surrender Debentures
to the Paying Agent to collect principal payments. The Company will pay
principal and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts. However, the
Company may pay principal and interest by check payable in such money. It may
mail an interest check to a Holder's registered address.
3. Paying Agent, Registrar. The Company will act as Paying Agent
and Registrar. The Company may change any Paying Agent and Registrar, or
co-registrar, without notice.
4. Optional Redemption. The Company may redeem all the Debentures at
any time or some of them from time to time at a price of 100% of the principal
amount of the Debentures plus accrued interest to the redemption date.
5. Notice of Redemption. Notice of Redemption will be mailed at
least 30 days but not more than 60 days before the redemption date to each
Holder of Debentures to be redeemed at this registered address. On and after
the redemption date, interest ceases to accrue on Debentures or portion of them
called for redemption.
6. Redemption by the Holder on Death. Under certain circumstances as
provided in the Indenture and upon request, the Company will, upon the death of
the Holder of a Debenture, repay the principal amount of the Debenture,
together with interest accrued to the redemption date, within 30 days following
a request therefor from the Holder's authorized representative, in accordance
with the provisions of the Indenture, if (i) the Debenture has been registered
in the Holder's name since the Date of Issue, (ii) the principal amount of the
Debentures to
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be repaid does not exceed $25,000, and (iii) the Company or the Trustee has
been notified in writing of the request for repayment within 180 days after the
Holder's death. If two or more persons are joint record Holders of a
Debenture, the election to redeem will not apply until all record Holders are
deceased, except that, if the joint Holders are husband and wife, the election
may be made after the death of either spouse.
7. Subordination. The Debentures are subordinated to Senior
Indebtedness of the Company, which is any Indebtedness of the Company
outstanding on the date of the Indenture or Indebtedness thereafter created,
incurred, assumed or guaranteed by the Company and all renewals, extensions and
refundings thereof, except such Indebtedness that by its terms expressly
provides that such Indebtedness is not senior or superior in right of payment
to the Debentures. Indebtedness is any indebtedness, contingent or otherwise,
in respect of borrowed money (whether or not the recourse of the lender is to
the whole of the assets of the Company or any subsidiary or only to a portion
thereof), or evidenced by bonds, notes, debentures or similar instruments or
letters of credit, representing the balance deferred and unpaid of the purchase
price of any property or interest therein, except any such balance that
constitutes a trade payable. To the extent provided in the Indenture, Senior
Indebtedness must be paid before the Debenture may be paid. The Company
agrees, and each Debenture Holder by accepting a Xxxxxxxxx agrees, to the
subordination and authorizes the Trustee to give it effect.
8. Transfer or Exchange. The Debentures are in registered form. The
transfer of Debentures may be registered and Debentures may be exchanged as
provided in the Indenture. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and to pay
any taxes and fees required by law or permitted by the Indenture. The
Registrar need not exchange or register the transfer of any Debenture or
portion of a Debenture selected for redemption. Also, it need not exchange or
register the transfer of any Debenture for a period of 15 days before a
selection of Debentures to be redeemed.
9. Persons Deemed Owners. The registered Holder of a Debenture may
be treated as its owner for all purposes.
10. Amendments and Waivers. Subject to certain exceptions, the
Indenture or the Debentures may be amended with the consent of the Holders of a
majority in principal amount of the then outstanding Debentures and any
existing default may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Debentures, except that no amendment
may alter or impair the obligation of the Company to pay principal of and
interest on this Debenture at the times, place and rate, and in the coin or
currency, or reduce the principal amount of Debentures the Holders of which must
consent to an amendment, without the consent of the Holder hereof. Without the
consent of any Debenture Holder, the
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Indenture or the Debenture may be amended to cure any ambiguity, defect or
inconsistency, to provide for assumption of Company obligations to Debenture
Holders, to increase the aggregate principal amount of Debentures to be issued
or to make any change that does not adversely affect the rights of any
Debenture Holder.
11. Defaults and Remedies. An Event of Default is: a default in
payment of principal on the Debenture which has not been cured; a default for
30 days in payment of any installment of interest on the Debenture; acceleration
of maturity of a Senior Indebtedness in an amount exceeding $500,000 under the
terms of the instrument under which such Senior Indebtedness is or may be
outstanding, if such acceleration is not annulled within 30 days after written
notice; or certain events of bankruptcy, insolvency or reorganization or
default in the performance or breach of any covenant or warranty of the Company
in the Indenture and continuance of such default in performance or breach for a
period or 60 days after notice of such default has been received by the Company
from the Trustee or from the Holders of 25% in principal amount of the
outstanding Debentures. If an Event of Default occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Debentures may declare all the Debentures to be due and payable
immediately. Debenture Holders may not enforce the Indenture or the Debentures
except as provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Debentures. Subject
to certain limitations, Holders of a majority in principal amount of the then
outstanding Debentures may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Debenture Holders notice of any
continuing default (except a default in payment of principal or interest) if it
determines that withholding notice is in their interest. The Company must
furnish an annual compliance certificate to the Trustee.
12. Trustee Dealing with the Company. National City Bank of
Minneapolis, the Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates, as if it were not Trustee.
13. No Recourse Against Others. A director, officer, employee or
stockholder, as such, of the Company shall not have any liability for any
obligations of the Company under the Debenture(s) or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. Each Debenture Holder by accepting a Debenture waives and releases
all such liability. The waiver and release are part of the consideration for
the issue of the Debenture.
14. Authentication. This Debenture shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.
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15. Abbreviations. Customary abbreviations may be used in the name
of a Debenture Holder or an assignee, such as: TEN COM (=tenants in common)
TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with right of
survivorship and not as tenants in common), CUST (=Custodian), U/T/M/A
(=Uniform Transfer to Minors Act) and XXX (=Transfer on Death).
The Company will furnish to any Debenture Holder upon written request
and without charge a copy of the Indenture, which has in it the text of this
Debenture in larger type. Requests may be made to: Investment Department,
ENStar Inc., 0000 Xxxx Xxxx Xxxxxxx, Xxxx Xxxxxxx, XX 00000.
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ASSIGNMENT FORM
To assign this Debenture, fill in the form below:
I or we assign and transfer this Debenture to
----------------------------
(Insert assignee's social security or tax I.D. number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint _______________________________________________________
agent to transfer this Debenture on the books of the Company. The agent may
substitute another to act for him.
________________________________________________________________________________
Date: __________ Your Signature: _________________________________________
(Sign exactly as your name appears on the other side of this Debenture)
****************************************************************
MATURITY FORM
To present this Debenture at maturity, fill in form below:
Date: ___________ Your Signature: ________________________________________
(Sign exactly as your name appears on the other side of this Debenture)
