RESOURCE AMERICA, INC.
TO
THE BANK OF NEW YORK, Trustee
12% SENIOR NOTES DUE 2004
---------------------------
INDENTURE
Dated as of July 22, 1997
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TABLE OF CONTENTS
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ARTICLE ONE Definitions and Other Provisions of General Application........................................... 1
Section 1.1 Definitions.............................................................................. 1
Section 1.2 Compliance Certificates and Opinions..................................................... 19
Section 1.3 Form of Documents Delivered to Trustee................................................... 20
Section 1.4 Acts of Holders, Record Dates............................................................ 20
Section 1.5 Notices, Etc., to Trustee and Company.................................................... 22
Section 1.6 Notice to Holders; Waiver................................................................ 22
Section 1.7 Conflict with Trust Indenture Act........................................................ 23
Section 1.8 Effect of Headings and Table of Contents................................................. 23
Section 1.9 Successors and Assigns................................................................... 23
Section 1.10 Separability Clause..................................................................... 23
Section 1.11 Benefits of Indenture.................................................................... 23
Section 1.12 Governing Law; Choice of Forum.......................................................... 23
Section 1.13 Legal Holidays.......................................................................... 25
ARTICLE TWO Senior Note Forms................................................................................. 25
Section 2.1 Forms Generally.......................................................................... 25
Section 2.2 Form of Face of Senior Note.............................................................. 25
Section 2.3 Form of Reverse of Senior Note........................................................... 27
Section 2.4 Form of Legend for Global Senior Notes................................................... 29
Section 2.5 Legending of the Securities; Restrictions on Transfers................................... 30
Section 2.6 Form of Trustee's Certificate of Authentication.......................................... 30
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Section 2.7 Form of Assignment and Election to Purchase.............................................. 30
ARTICLE THREE The Senior Notes............................................................................... 31
Section 3.1 Global Senior Note; Depositary............................................................ 31
Section 3.2 Amount.................................................................................... 31
Section 3.3 Denominations............................................................................. 31
Section 3.4 Execution, Authentication, Delivery and Dating............................................ 32
Section 3.5 Temporary Notes........................................................................... 32
Section 3.6 Registration; Registration of Transfer and Exchange....................................... 33
Section 3.7 Xxxxxxxxx, Xxxxxxxxx, Lost and Stolen Notes............................................... 34
Section 3.8 Payment of Interest; Interest Rights Preserved............................................ 34
Section 3.9 Persons Deemed Owners..................................................................... 36
Section 3.10 Cancellation............................................................................. 36
Section 3.11 Computation of Interest.................................................................. 36
Section 3.12 CUSIP Numbers............................................................................ 36
ARTICLE FOUR Book-Entry Provisions for Global Senior Notes.................................................... 37
Section 4.1 Applicability of Article.................................................................. 37
Section 4.2 Book-Entry Provisions For Global Senior Note.............................................. 37
ARTICLE FIVE Remedies......................................................................................... 39
Section 5.1 Events of Default........................................................................ 39
Section 5.2 Acceleration of Maturity; Rescission and Annulment....................................... 40
Section 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee.......................... 41
Section 5.4 Trustee May File Proofs of Claim......................................................... 42
Section 5.5 Trustee May Enforce Claims Without Possession of Senior Notes............................ 42
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Section 5.6 Application of Money Collected........................................................... 43
Section 5.7 Limitation on Suits...................................................................... 43
Section 5.8 Unconditional Right of Holders to Receive Principal,
Premium and Interest............................................................... 44
Section 5.9 Restoration of Rights and Remedies....................................................... 44
Section 5.10 Rights and Remedies Cumulative.......................................................... 44
Section 5.11 Delay or Omission Not Waiver............................................................ 44
Section 5.12 Control by Holders...................................................................... 44
Section 5.13 Waiver of Past Defaults................................................................. 45
Section 5.14 Undertaking for Costs................................................................... 45
Section 5.15 Waiver of Usury, Stay or Extension Laws................................................. 46
ARTICLE SIX The Trustee...................................................................................... 46
Section 6.1 Certain Duties and Responsibilities...................................................... 46
Section 6.2 Notice of Defaults....................................................................... 47
Section 6.3 Certain Rights of Trustee................................................................ 47
Section 6.4 Not Responsible for Recitals or Issuance of Senior Notes.................................. 48
Section 6.5 May Hold Senior Notes..................................................................... 48
Section 6.6 Money Held in Trust....................................................................... 48
Section 6.7 Compensation and Reimbursement............................................................ 49
Section 6.8 Disqualification; Conflicting Interests................................................... 49
Section 6.9 Corporate Trustee Required; Eligibility................................................... 49
Section 6.10 Resignation and Removal; Appointment of Successor........................................ 50
Section 6.11 Acceptance of Appointment by Successor................................................... 51
Section 6.12 Merger, Conversion, Consolidation or Succession to Business.............................. 52
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Section 6.13 Preferential Collection of Claims Against Company........................................ 52
Section 6.14 Appointment of Authenticating Agent...................................................... 52
ARTICLE SEVEN Holders' Lists and Reports by Trustee and Company............................................. 54
Section 7.1 Company to Furnish Trustee Names and Addresses of
Holders; Trustee to Furnish Senior Note Register..................................... 54
Section 7.2 Preservation of Information; Communications to Holders.................................... 55
Section 7.3 Reports by Trustee........................................................................ 55
ARTICLE EIGHT Amendments, Supplements and Waivers............................................................ 56
Section 8.1 Supplemental Indentures Without Consent of Holders........................................ 56
Section 8.2 Supplemental Indentures with Consent of Holders........................................... 57
Section 8.3 Execution of Supplemental Indentures...................................................... 58
Section 8.4 Effect of Supplemental Indentures......................................................... 58
Section 8.5 Conformity with Trust Indenture Act....................................................... 58
Section 8.6 Reference in Senior Notes to Supplemental Indentures...................................... 58
Section 8.7 Notice of Supplemental Indenture.......................................................... 58
ARTICLE NINE Covenants........................................................................................ 59
Section 9.1 Payment of Principal, Premium and Interest............................................... 59
Section 9.2 Maintenance of Office or Agency.......................................................... 59
Section 9.3 Money for Senior Notes Payments to Be Held in Trust...................................... 59
Section 9.4 Statement by Officers as to Default...................................................... 61
Section 9.5 Payment of Taxes and Other Claims........................................................ 61
Section 9.6 Maintenance of Properties................................................................ 61
Section 9.7 Corporate Existence; Keeping of Books.................................................... 62
Section 9.8 Insurance................................................................................ 62
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Section 9.9 Net Worth Maintenance.................................................................... 62
Section 9.10 Limitations on Indebtedness.............................................................. 62
Section 9.11 Liquidity Maintenance.................................................................... 64
Section 9.12 Limitations on Restricted Payments....................................................... 65
Section 9.13 Limitations on Dividends and Other Payment Restrictions
Affecting Subsidiaries............................................................. 66
Section 9.14 Limitations on Transactions with Affiliates.............................................. 67
Section 9.15 Limitations on Liens and Guarantees...................................................... 68
Section 9.16 Offer to Purchase upon a Change of Control Event......................................... 68
Section 9.17 Payments for Consent..................................................................... 70
Section 9.18 Waiver of Certain Covenants.............................................................. 70
ARTICLE TEN Merger, Consolidation and Transfer of Assets..................................................... 71
Section 10.1 Merger, Consolidation or Transfer of Assets of the Company............................... 71
Section 10.2 Successor Substituted.................................................................... 71
Section 10.3 Senior Notes to Be Secured in Certain Events............................................. 72
ARTICLE ELEVEN Redemption of Senior Notes.................................................................... 72
Section 11.1 Applicability of Article................................................................ 72
Section 11.2 Optional Redemption..................................................................... 72
Section 11.3 Election to Redeem; Selection by Trustee of Senior Notes
to Be Redeemed.................................................................... 72
Section 11.4 Notice of Redemption.................................................................... 73
Section 11.5 Deposit of Redemption Price............................................................. 74
Section 11.6 Senior Notes Payable on Redemption Date................................................. 74
Section 11.7 Senior Notes Redeemed in Part........................................................... 74
ARTICLE TWELVE Defeasance and Covenant Defeasance............................................................ 75
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Section 12.1 Option to Effect Legal Defeasance or Covenant Defeasance................................. 75
Section 12.2 Legal Defeasance and Discharge........................................................... 75
Section 12.3 Covenant Defeasance....................................................................... 75
Section 12.4 Conditions to Legal or Covenant Defeasance............................................... 76
Section 12.5 Deposited Money and U.S. Government Obligations To Be
Held in Trust; Other Miscellaneous Provisions...................................... 77
Section 12.6 Reinstatement............................................................................ 78
ARTICLE THIRTEEN Miscellaneous................................................................................ 78
Section 13.1. No Recourse Against Others.............................................................. 78
Section 13.2. Execution in Counterparts............................................................... 78
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RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939
AND INDENTURE, DATED AS OF JULY 22, 1997
TIA Section Indenture Section
310(a)(1) 6.9
(a)(2) 6.9
(a)(3) Not Applicable
(a)(4) Not Applicable
(a)(5) 6.9
(b) 1.5, 6.8, 6.9, 6.10, 6.11
(c) Not Applicable
311(a) 6.13
(b) 6.13
(c) Not Applicable
312(a) 7.1, 7.2
(b) 7.2
(c) 7.2
313(a) 7.3
(b)(1) Not Applicable
(b)(2) 7.3
(c) 1.6, 7.3
(d) 7.3
314(a) 1.5, 1.6, 7.4
(b) Not Applicable
(c)(1) 1.2
(c)(2) 1.2
(c)(3) Not Applicable
(d) Not Applicable
(e) 1.2
(f) Not Applicable
315(a) 6.1
(b) 1.6, 6.2
(c) 6.1
(d) 6.1
(e) 5.14
316(a)(last sentence) 1.1 (definition of "Outstanding")
316(a)(1)(A) 5.12
(a)(1)(B) 5.13
(a)(2) Not Applicable
(b) 5.7, 5.8
(c) 1.4
317(a)(1) 5.3
(a)(2) 5.4
(b) 6.6, 9.3
318(a) 1.7
(b) 6.6, 9.3
(c) 1.7
vii
INDENTURE, dated as of July 22, 1997, between RESOURCE AMERICA, INC., a
corporation duly organized and existing under the laws of the State of Delaware
(herein called the "Company"), having its principal office at 0000 Xxxxxx
Xxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 19102, and THE BANK OF NEW YORK, a New York
banking corporation, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
A. The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance of up to $75,000,000 in principal amount
of its unsecured 12% Senior Notes due 2004, whether Original Senior Notes (as
defined below) or Series B Senior Notes (as defined below), to be issued as in
this Indenture provided.
B. All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Senior
Notes (as defined below) by the Holders thereof, it is mutually agreed, for the
equal and proportionate benefit of all Holders of the Senior Notes, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER
PROVISIONS OF GENERAL APPLICATION
SECTION 1.1 Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have
the meanings assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP;
(4) the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Indenture as a whole and not
to any particular Article, Section or other subdivision;
(5) the word "including" is not limiting;
(6) references in this Indenture to any agreement, other document
or law "as amended" or "as amended from time to time," or to
"amendments" of any document or law, shall include any
amendments, supplements, replacements, renewals or other
modifications from time to time, provided in the case of
modifications to documents, such modifications are permissible
under this Indenture; and
(7) references in this Indenture to any law include regulations
promulgated thereunder from time to time.
"Accredited Investor" means an accredited investor within the meaning
of Rule 501(a) of Regulation D under the Securities Act.
"Acquired Indebtedness" means Indebtedness of a person (i) existing at
the time such Person becomes a Subsidiary of or is merged with or into any other
Person or (ii) assumed in connection with the acquisition of assets from such
Person, in each case, other than Indebtedness incurred in connection with, or in
contemplation of, such Person becoming a Subsidiary of such other Person or such
acquisition. Acquired Indebtedness shall be deemed to be incurred on the date of
the related acquisition of assets from such Person or the date such Person
becomes a Subsidiary of or is merged with or into such other Person.
"Act", when used with respect to any Holder, has the meaning specified
in Section 1.4.
"Additional Interest" means any Registration Penalty and the interest,
if any, that shall accrue on any interest on the Senior Notes the payment of
which has not been made on the applicable Interest Payment Date and which shall
accrue at the rate per annum specified or determined as specified in such Senior
Note.
"Affiliate" means, with respect to any specified Person, any other
Person directly or indirectly Controlling or Controlled by or under direct or
indirect common Control with such specified Person and any legal or beneficial
owner, directly or indirectly, of 20% or more of the Voting Stock of such
specified Person. Notwithstanding the foregoing, no Securitization Entity shall
be deemed an Affiliate of the Company.
"Applicable Law" means all applicable provisions of all (i)
constitutions, treaties, statutes, laws, rules, regulations and ordinances of
any Governmental Authority, (ii) Governmental Approvals and (iii) orders,
decisions, judgments, awards and decrees of any Governmental Authority.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate Senior
Notes.
"Authorized Officer" means any officer of the Company designated by a
Board Resolution to take certain actions as specified in this Indenture.
"Average Life to Stated Maturity" means, as of the date of
determination with respect to any Indebtedness, the quotient obtained by
dividing (i) the sum of the products of (a) the number of years from the date of
determination to the date or dates of each successive scheduled principal
2
payment of such Indebtedness multiplied by (b) the amount of each such principal
payment by (ii) the sum of all such principal payments.
"Board of Directors" means the board of directors or any duly
authorized committee of that board. Unless otherwise indicated, "Board of
Directors" means the Board of Directors of the Company.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors of the Company, or by action of an Authorized Officer
designated as such pursuant to a resolution of the Board of Directors of the
Company, and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day" means each day which is not a Legal Holiday.
"Capital Lease Obligation" of any Person means any obligations of such
Person under any capital lease for real or personal property which, in
accordance with GAAP, is required to be recorded as a capitalized lease
obligation; and, for the purpose of this Indenture, the amount of such
obligation at any date shall be the capitalized amount thereof at such date,
determined in accordance with GAAP.
"Capital Stock" in any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents or
interests in (however designated) capital stock in such Person, including, with
respect to a corporation, common stock, Preferred Stock and other corporate
stock and, with respect to a partnership, partnership interests, whether general
or limited, and any rights (other than debt securities convertible into
corporate stock, partnership interests or other capital stock), warrants or
options exchangeable for or convertible into such corporate stock, partnership
interests or other capital stock.
"Change of Control Event" means an event or series of events by which
(a) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act), other than the
Management group, is or becomes after the date of issuance of
the Senior Notes the "beneficial owner" (as defined in Rules
13 d-3 and 13d-5 under the Exchange Act as in effect on the
date of the In-denture), of more than 40% of the total voting
power of all Voting Stock of the Company then outstanding;
(b) (1) another corporation merges into the Company or
the Company consolidates with or merges into any other
corporation, or
(2) the Company conveys, transfers or leases all or
substantially all its assets to any person or group, in one
transaction or a series of transactions other than any
conveyance, transfer or lease between the Company and a
Wholly-Owned Subsidiary of the Company, and in the case of
each of clause (1) and clause (2), with the effect that a
person or group, other than the Management group, is or
becomes the beneficial owner of more than 40% of the total
voting power of all Voting Stock of the surviving or
transferee corporation of such transaction or series of
transactions;
3
(c) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Company's Board
of Directors, or whose nomination for election by the
Company's shareholders was approved by a vote of a majority of
the directors then still in office who were either directors
at the beginning of such period or whose election or
nomination for election was previously so approved, cease for
any reason to constitute a majority of the directors then in
office; or
(d) the shareholders of the Company shall approve any plan or
proposal for the liquidation or dissolution of the Company.
"Change of Control Purchase Date," "Change of Control Purchase Notice,"
"Change of Control Purchase Price" and "Change of Control Purchase Offer" are
defined in Section 9.17.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board or its President, and by its Chief Financial Officer, its
Controller or an Assistant Controller, and delivered to the Trustee.
"Consolidated Depreciation and Amortization Expense" means with respect
to any Person for any period, the total amount of depreciation and amortization
expense of such Person for such period on a consolidated basis and otherwise
determined in accordance with GAAP.
"Consolidated EBITDA" means, with respect to any Person for any period,
the Consolidated Net Income (Loss) of such Person for such period plus (a)
provision for taxes based on income or profits of such Person for such period
deducted in computing Consolidated Net Income (Loss) plus (b) Consolidated
Interest Expense of such Person for such period, plus (c) Consolidated
Depreciation and Amortization Expense of such Person for such period to the
extent such depreciation and amortization were deducted in computing
Consolidated Net Income (Loss), plus (d) without duplication, any other non-cash
charges reducing Consolidated Net Income (Loss) of such Person for such period
less (e) without duplication, non-cash items increasing Consolidated Net Income
(Loss) of such Person for such period in each case, on a consolidated basis for
such Person in accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any period, the
sum of: (a) consolidated interest expense of such Person for such period, other
than the interest expense on Permitted Acquisition Indebtedness and Permitted
Repurchase Facilities, whether paid or accrued (except to the extent accrued in
a prior period), to the extent such expense was deducted in computing
Consolidated Net Income (Loss) (including amortization of original issue
discount, non-cash interest payments and the interest component of Capital Lease
Obligations, excluding amortization of deferred financing fees) and (b)
consolidated capitalized interest of such Person for such period, whether paid
or accrued, to the extent such expense was deducted in computing Consolidated
Net Income (Loss).
4
"Consolidated Net Assets" of any Person as of any date means the total
amount of assets of such Person and its Subsidiaries (less applicable reserves)
on a consolidated basis at the end of the fiscal quarter immediately preceding
such date for which financial information is available, as determined in
accordance with GAAP.
"Consolidated Net Income (Loss)" of any Person means, for any period,
the consolidated net income (or loss) of such Person and its consolidated
Subsidiaries for such period as determined in accordance with GAAP, adjusted, to
the extent included in calculating such net income (loss), by excluding, without
duplication, (i) the portion of net income (or loss) of any other Person (other
than any of such Person's consolidated Subsidiaries) in which such Person or any
of its Subsidiaries has an ownership interest, except to the extent of the
amount of dividends or other distributions actually paid to such Person or its
consolidated Subsidiaries in cash by such other Person during such period, (ii)
net income (or loss) of any Person combined with such Person or any of its
Subsidiaries on a "pooling of interests" basis attributable to any period prior
to the date of combination, (iii) any gain or loss, net of taxes, realized upon
the termination of any employee pension benefit plan and (iv) solely for the
purpose of determining Consolidated Net Income (Loss) in connection with the
calculation of Restricted Payments permitted to be made hereunder, the net
income of any consolidated Subsidiary of such Person to the extent that the
declaration or payment of dividends or similar distributions by that Subsidiary
of that income is not at the time permitted, directly or indirectly, by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulations applicable to that
Subsidiary or its shareholders; provided that, upon the termination or
expiration of such dividend or distribution restrictions, the portion of net
income (or loss) of such consolidated Subsidiary allocable to such Person and
previously excluded shall be added to the Consolidated Net Income (Loss) of such
Person to the extent of the amount of dividends or other distributions available
to be paid to such Person in cash by such Subsidiary.
"Consolidated Net Worth" of any Person and its Subsidiaries mean as of
the date of determination all amounts that would be included under stockholders'
equity on a consolidated balance sheet of such Person and its Subsidiaries
determined in accordance with GAAP.
"Control" when used with respect to any specified Person means the
power to direct the management and policies of such Person directly or
indirectly, whether through ownership of voting securities (or pledge of voting
securities if the pledgee thereof may on the date of determination exercise or
control the exercise of the voting rights of the owner of such voting
securities), by contract or otherwise; and the terms "to Control," "Controlling"
and "Controlled" have meanings correlative to the foregoing.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office as of the date hereof is located at 000 Xxxxxxx
Xxxxxx, Xxxxx 00 Xxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Covenant Defeasance" has the meaning specified in Section 12.3.
"Credit Support" means credit support designed to enhance the
likelihood of payment on securities issued in connection with a securitization
of loans or other assets which are generally funded with the proceeds of such
securitization, including without limitation subordination of certain classes of
securities, insurance policies, representations and warranties, reserve funds,
liquidity reserves, lost- and missing- note reserves and letters of credit.
5
"Default" means an event or condition the occurrence of which would,
with the lapse of time or the giving of notice or both, become an Event of
Default.
"Defaulted Interest" has the meaning specified in Section 3.8.
"Depositary" has the meaning specified in Section 3.1.
"Disqualified Capital Stock" means any Capital Stock which, by its
terms (or by the terms of any security into which it is convertible or
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder thereof, in whole or in part on, or prior to, or is
exchangeable for debt securities of the Company or its Subsidiaries prior to,
the final Stated Maturity of principal of the Senior Notes; provided that only
the amount of such Capital Stock that is redeemable prior to the Stated Maturity
of principal of the Senior Notes shall be deemed to be Disqualified Capital
Stock.
"Disinterested Director" of any Person means, with respect to any
transaction or series of related transactions, a member of the board of
directors of such Person who does not have any material direct or indirect
financial interest in or with respect to such transaction or series of related
transactions.
"Event of Default" has the meaning specified in Section 5.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Offer" means the offer by the Company and the Guarantors to
exchange the Series B Senior Notes for the Original Senior Notes made pursuant
to the Senior Notes Registration Rights Agreement.
"Existing Management Group" means a majority of the executive officers
of the Company as of the date of the Indenture as set forth in the Placement
Memorandum, members of their immediate families, certain trusts for their
benefit and legal representatives of, or heirs, beneficiaries or legatees
receiving Common Stock (or securities convertible or exchangeable for Common
Stock) under any such person's estate.
"Fair Market Value" means, with respect to any asset, the price which
could be negotiated in an arm's-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of which is under
compulsion to complete the transaction; provided, however, that the Fair Market
Value of any asset or assets shall be determined by the Board of Directors of
the Company, acting in good faith, and shall be evidenced by a Board Resolution.
"Fixed Charges" means, with respect to any Person for any period, the
sum of (i) Consolidated Interest Expense of such Person for such period, and
(ii) the product of (A) all cash dividend payments on any series of Preferred
Stock or Disqualified Capital Stock of such Person or its Subsidiaries for such
period, and (B) a fraction, the numerator of which is one and the denominator of
which is one minus the then-current combined federal, state and local statutory
tax rate of such Person, expressed as a decimal, in each case on a consolidated
basis and in accordance with GAAP.
6
"GAAP" means generally accepted accounting principles as in effect on
the date of computation.
"Global Senior Note" means a Senior Note bearing the legend prescribed
in Section 2.4 evidencing all or part of the Senior Notes, authenticated and
delivered to the Depositary or its nominee, and registered in the name of such
Depositary or nominee.
"Global Senior Note holder" has the meaning specified in Section 3.1.
"Governmental Approval" means an authorization, consent, approval,
permit, license, registration or filing with any Governmental Authority.
"Governmental Authority" with respect to any Person, means any nation
(including an Indian nation), any state or other political subdivision thereof
and any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, including any
government authority, agency, department, board, commission or instrumentality
of the United States, any state of the United States or any political
subdivision thereof, and any tribunal or arbitrator(s) of competent jurisdiction
in each case, having jurisdiction or authority over such Person.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any Person and any obligation, direct or indirect, contingent or otherwise,
of such Person (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other obligation of such Person
(whether arising by virtue of partnership arrangements, or by agreements to
purchase assets, goods, securities or services, to take-or-pay or to maintain
financial statement conditions or otherwise) or (ii) entered into for the
purpose of assuring in any other manner the obligee of such Indebtedness or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided, however, that the term
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"Guarantor" means any person Guaranteeing any obligation.
"Guaranteed Indebtedness" of any Person means, without duplication, all
Indebtedness of any other Person guaranteed directly or indirectly in any manner
by such Person, or in effect guaranteed directly or indirectly by such person
through an agreement (i) to pay or purchase such Indebtedness or to advance or
supply funds for the payment or purchase of such Indebtedness, (ii) to purchase,
sell or lease (as lessee or lessor) property, or to purchase or sell services,
primarily for the purpose of enabling the debtor to make payment of such
Indebtedness or to assure the holder of such Indebtedness against loss, (iii) to
supply funds to, or in any other manner invest in, the debtor (including any
agreement to pay for property or services without requiring that such property
be received or such services be rendered), (iv) to maintain working capital or
equity capital of the debtor, or otherwise to maintain the net worth, solvency
or other financial condition of the debtor, or (v) otherwise to assure a
creditor with respect to Indebtedness against loss; provided that the term shall
not include endorsements for collection of deposit, in either case in the
ordinary course of business.
7
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement or Currency Agreement.
"Holders" or "Senior Note Holders" means the Person in whose name a
Senior Note is registered on the Registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by such
Subsidiary at the time it becomes a Subsidiary. The term "Incurrence" when used
as a noun shall have a correlative meaning. The accretion of principal of a
non-interest bearing or other discount security shall be deemed the Incurrence
of Indebtedness.
"Indebtedness" means, with respect to any Person, without duplication,
(i) all indebtedness of such Person for borrowed money or for the deferred
purchase price of property or services, excluding any trade payables and other
accrued current liabilities arising in the ordinary course of business, but
including, without limitation, all obligations, contingent or otherwise, of such
Person in connection with any letters of credit issued under letter of credit
facilities, and in connection with any agreement by such Person to purchase,
redeem, exchange, convert or otherwise acquire for value any Capital Stock of
such Person now or hereafter outstanding, (ii) all obligations of such Person
evidenced by bonds, notes, debentures or other similar instruments, (iii) all
indebtedness of such Person created or arising under any conditional sale or
other title retention agreement with respect to property acquired by such
Person, but excluding trade payables arising in the ordinary course of business,
(iv) all obligations under Interest Rate Agreements of such Person, (v) all
Capital Lease Obligations of such Person, (vi) all Indebtedness referred to in
clauses (i) through (v) above of other Persons and all dividends payable by
other Persons, the payment of which is secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien, upon or with respect to property (including, without limitation,
accounts and contract rights) owned by such Person, even though such Person has
not assumed or become liable for the payment of such Indebtedness (the amount of
such obligations being deemed to be the lesser of the value of such property or
asset or the amount of the obligations so secured), (vii) all guarantees by such
Person of Guaranteed Indebtedness, (viii) all Disqualified Capital Stock (valued
at the greater of book value and voluntary or involuntary maximum fixed
repurchase price plus accrued and unpaid dividends) of such Person, and (ix) any
amendment, supplement, modification, deferral, renewal, extension, refunding or
refinancing or any liability of the types referred to in clauses (i) through
(viii) above. For purposes hereof, (x) the "maximum fixed repurchase price" of
any Disqualified Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Disqualified Capital Stock as if
such Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to the Indenture, and if such price
is based upon, or measured by, the fair market value of such Disqualified
Capital Stock, such fair market value is to be determined in good faith by the
board of directors (or any duly authorized committee thereof) of the issuer of
such Disqualified Capital Stock, and (y) Indebtedness is deemed to be incurred
pursuant to a revolving credit facility each time an advance is made thereunder.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into
8
pursuant to the applicable provisions hereof, including, for all purposes of
this instrument, and any such supplemental indenture, the provisions of the
Trust Indenture Act that are deemed to be a part of and govern this instrument
and any such supplemental indenture, respectively.
"Interest Payment Date" means the date on which any installment of
interest (including any Additional Interest) on the Senior Notes becomes due and
payable, as provided in Section 2.2.
"Interest Rate Agreement" means any interest rate swap agreement,
interest rate cap agreement, repurchase agreement, futures contract or other
financial agreement or arrangement designed to protect the Company or any
Subsidiary against fluctuations in interest rates.
"Issue Date" means the date on which the Original Senior Notes are
originally issued.
"Junior Indebtedness" means any Indebtedness of the Company
subordinated in right of payment of either principal, premium (if any) or
interest (including any Additional Interest) thereon to the Senior Notes.
"Legal Defeasance" has the meaning specified in Section 12.2.
"Legal Holiday" means any Saturday, Sunday or other day on which banks
in the States of New York or Pennsylvania are authorized or obligated by law or
executive order to be closed for business.
"Leverage Ratio" as of any date of determination means the ratio of (i)
the aggregate amount of all Indebtedness and Disqualified Capital Stock of the
Company, excluding (A) Indebtedness and Guarantees thereof permitted to be
incurred pursuant to Section 9.10 (f) (1), (2), (3), (4), (6) and (7) hereof;
(B) Hedging Obligations permitted to be incurred pursuant to Section 9.10
(f)(11) hereof; and (C) Junior Indebtedness of the Company to (ii) the
Consolidated Net Worth of the Company.
"Lien" means any mortgage, charge, pledge, lien (statutory or
otherwise), security interest, hypothecation or other encumbrance upon or with
respect to any property of any kind, real or personal, movable or immovable, now
owned or hereafter acquired.
"Liquid Assets" shall include: (i) cash; (ii) any of the following
instruments that have a remaining term to maturity not in excess of 90 days from
the determination date: (a) repurchase agreements on obligations of, or are
guaranteed as to timely receipt of principal and interest by, the United States
or any agency or instrumentality thereof when such obligations are backed by the
full faith and credit of the United States provided that the party agreeing to
repurchase such obligations is a primary dealer in U.S. government securities,
(b) federal funds and deposit accounts, including but not limited to
certificates of deposit, time deposits and bankers' acceptances of any U.S.
depository institution or trust company incorporated under the laws of the
United States or any state, provided that the debt of such depository
institution or trust company at the date of acquisition thereof has been rated
by Standard & Poor's Corporation in the highest short-term rating category or
has an equivalent rating from another nationally recognized rating agency, or
(c) commercial paper of any corporation incorporated under the laws of the
United States or any state thereof that on the date of acquisition is rated
investment grade by Standard & Poor's Corporation or has an equivalent rating
from another nationally recognized
9
rating agency; (iii) any debt instrument which is an obligation of, or is
guaranteed as to the receipt of principal and interest by the United States, its
agencies or any U.S. government sponsored enterprise, or (iv) any
mortgage-backed or mortgage-related security issued by the United States, its
agencies, or any U.S. government sponsored enterprise which the payment of
principal and interest from the mortgages underlying such securities will be
passed through to the holder thereof and which such security has a remaining
weighted average maturity of 15 years or less. Notwithstanding the foregoing,
Liquid Assets shall not include any debt instruments, securities or
collateralized mortgage obligations (real estate mortgage investment conduits)
that would be classified as a "High-Risk Mortgage Security" pursuant to the
policy statement adopted by the Federal Financial Institutions Examination
Counsel on February 10, 1992, as reflected in Volume I of the Federal Reserve
Report Service, Part 3-1562.
"Maturity", when used with respect to any Senior Note, means the date
on which the principal of such Senior Note or with respect to any installment of
principal, when such installment of principal becomes due and payable as therein
or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption, upon repurchase or otherwise.
"Net Cash Proceeds" means, with respect to any issuance or sale of
Capital Stock, or options, warrants or rights to purchase Capital Stock, or debt
securities or Capital Stock that have been converted into or exchanged for
Capital Stock, or any capital contribution in respect of Capital Stock, as
referred to under Section 9.13 hereof, the proceeds of such issuance or sale or
capital contribution in the form of cash or cash equivalents, including payments
in respect of deferred payment obligations when received in the form of, or
stock or other assets when disposed for, cash or cash equivalents (except to the
extent that such obligations are financed or sold with recourse to the Company
or any Subsidiary of the Company), net of attorney's fees, accountant's fees and
brokerage, consulting, underwriting and other fees and expenses actually
incurred in connection with such issuance or sale or capital contribution and
net of taxes paid or payable by the Company as a result thereof.
"Non-Recourse Indebtedness" means, with respect to any Person,
Indebtedness of such Person for which (i) the sole recourse (excluding certain
exceptions relating to fraud, intentional misrepresentation, proceeds of the
assets, environmental liabilities and similar matters customary in non-recourse
indebtedness) for collection of principal and interest on such Indebtedness is
against the specific assets identified in the instruments evidencing or securing
such Indebtedness, (ii) such assets were acquired with the proceeds of such
Indebtedness or such Indebtedness was incurred concurrently with the acquisition
of such assets; and (iii) no other assets (other than Credit Support) of such
Person or of any other Person may be realized upon or in collection of principal
or interest on such Indebtedness.
"Offering" means the initial private placement of the Senior Notes by
the Company.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, a Vice Chairman of the Board, the Chief Executive Officer or the
President, and by the Chief Executive Officer, the President, the Chief
Financial Officer, the Controller or an Assistant Controller, of the Company
(provided that no one person signs twice on behalf of the Company), and
delivered to the Trustee. One of the officers signing an Officers' Certificate
given pursuant to Section 9.4 shall be the principal executive, financial or
accounting officer of the Company. Unless otherwise indicted, "Officers'
Certificate" means an Officers' Certificate of the Company.
10
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company and who shall be acceptable to the Trustee.
"Original Senior Notes" means the 12% Senior Notes due 2004, as amended
or supplemented from time to time in accordance with the terms hereof, issued
under this Indenture on the Issue Date.
"Outstanding", when used with respect to Senior Notes, means, as of the
date of determination, all Senior Notes theretofore authenticated and delivered
under this Indenture, except:
(i) Senior Notes theretofore canceled by the Trustee
or delivered to the Trustee for cancellation;
(ii) Senior Notes for whose payment or redemption
money in the necessary amount has been theretofore deposited
with the Trustee or any Paying Agent (other than the Company)
in trust or set aside and segregated in trust by the Company
(if the Company shall act as its own Paying Agent) for the
Holders of such Senior Notes; provided that, if such Senior
Notes are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and
(iii) Senior Notes paid pursuant to Section 3.7 or in
exchange for or in lieu of which other Senior Notes have been
authenticated and delivered pursuant to this Indenture, other
than any such Senior Notes in respect of which there shall
have been presented to the Trustee proof satisfactory to it
that such Senior Notes are held by a bona fide purchaser in
whose hands such Senior Notes are valid obligations of the
Company provided, however, that in determining whether the
Holders of the requisite principal amount of the Outstanding
Senior Notes have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, (i) Senior
Notes owned by the Company or any other obligor on the Senior
Notes or any Affiliate of the Company shall be disregarded and
deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice,
consent or waiver, only Senior Notes which a Responsible
Officer of the Trustee actually knows to be so owned shall be
so disregarded. Senior Notes so owned which have been pledged
in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's
right so to act with respect to such Senior Notes and that the
pledgee is not the Company or any other obligor on the Senior
Notes or any Affiliate of the Company.
"Pari Passu Indebtedness" means any Indebtedness of the Company that is
pari passu in right of payment of principal, premium (if any) and interest
(including any Additional Interest) thereon to the Senior Notes.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest (including any Additional
Interest) on any Notes on behalf of the Company or, if the Company is acting as
its own Paying Agent, the Company. Initially, the Paying Agent shall be the
Trustee.
11
"Permitted Acquisition Indebtedness" means any secured funding
arrangement with a financial institution or other lender to the extent (and only
to the extent) funding thereunder is used exclusively to finance or refinance
the purchase or origination of loans, real estate owned, equipment leases or
other assets by the Company or a Subsidiary or to provide related financing
subsequent to such purchase or origination.
"Permitted Liens" means (i) Liens for taxes, assessments, governmental
charges or claims that are being contested in good faith by appropriate legal
proceedings instituted and diligently conducted and for which a reserve or other
appropriate provision, if any, as shall be required in conformity with GAAP
shall have been made; (ii) statutory Liens of landlords and carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen or other similar
Liens imposed by law and arising in the ordinary course of business and with
respect to amounts not yet delinquent or being contested in good faith by
appropriate legal proceedings promptly instituted and diligently conducted and
for which a reserve or other appropriate provision, if any, as shall be required
in conformity with GAAP shall have been made; (iii) Liens incurred or deposits
made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security; (iv)
Liens incurred or deposits made to secure the performance of tenders, bids,
leases, statutory or regulatory obligations, surety and appeal bonds, progress
payments, development obligations, government contracts, performance and
return-of-money bonds and other obligations of a similar nature, in each case
incurred in the ordinary course of business (exclusive of obligations for the
payment of borrowed money or otherwise constituting a liability in accordance
with GAAP); (v) with respect to property of the Company or any Subsidiary, Liens
granted on such property or assets in favor of the Person from whom the Company
or such Subsidiary acquired such property or assets which Liens secure the
payment of a contingent portion of the purchase price of such property so long
as such Liens are granted and such arrangement is entered into in the ordinary
course of business of the Company; (vi) attachment or judgment Liens not giving
rise to a Default or Event of Default and which are being contested in good
faith by appropriate proceedings; (vii) easements, rights-of-way, restrictions,
homeowners association assessments and similar charges or encumbrances that do
not materially interfere with the ordinary course of business of the Company or
any of its Subsidiaries; (viii) zoning restrictions, licenses, restrictions on
the use of real property or minor irregularities in title thereto, which do not
materially impair the use of such property in the ordinary course of business of
the Company or any Subsidiary or the value of such real property for the purpose
of such business; (ix) Liens in favor of the Company or any Subsidiary that is a
Wholly Owned Subsidiary of the Company; (x) Liens existing on the Closing Date;
(xi) Liens securing Non-Recourse Indebtedness of the Company or a Subsidiary
thereof, (xii) Liens with respect to the property or assets of the Company or a
Subsidiary securing Indebtedness permitted to be incurred pursuant to Section
9.10 (e)(1), (2), (3), (4), (6) and (7) hereof; (xiii) Liens granted after the
Issue Date on any assets or Capital Stock of the Company or its Subsidiaries
created in favor of the Holders; (xiv) Liens with respect to the property or
assets of a Subsidiary granted by such Subsidiary to the Company to secure
Indebtedness owing to the Company; (xv) Liens securing Indebtedness which is
incurred to refinance Permitted Indebtedness, provided that such Liens
constitute Permitted Liens under this clause (xv) only to the extent that they
do not extend to or cover any property or assets of the Company or any
Subsidiary other than the property or assets securing the Indebtedness being
refinanced; (xvi) leases or subleases granted to others not materially
interfering with the ordinary course of business of the Company or any of its
Subsidiaries; (xvii) other Liens securing obligations not exceeding $1,000,000
in the aggregate; and (xviii) Liens securing Hedging Obligations of the Company
or such Subsidiary so long as
12
such Hedging Obligations relate to Indebtedness that is, and is permitted under
this Indenture to be, secured by a Lien on the same property securing such
Hedging Obligations.
"Permitted Payment" means, so long as no Default or Event of Default is
continuing,
(a) the purchase, redemption, defeasance or other acquisition or
retirement for value of any Capital Stock of the Company or any
Affiliate (other than a Wholly-Owned Subsidiary) of the Company,
Junior Indebtedness or Pari Passu Indebtedness in exchange for
(including any such exchange pursuant to the exercise of a
conversion right or privilege where, in connection therewith,
cash is paid in lieu of the issuance of fractional shares or
scrip), or out of the Net Cash Proceeds or Fair Market Value of
property not constituting Net Cash Proceeds of, a substantially
concurrent issue and sale (other than to a Subsidiary of the
Company or to an employee benefit plan of the Company or any of
its Subsidiaries) of Qualified Capital Stock of the Company;
provided that the Net Cash Proceeds or Fair Market Value of such
property received by the Company from the issuance of such shares
of Qualified Capital Stock, to the extent so utilized, shall be
excluded from clause (c)(iii) of Section 9.13 hereof; and
(b) the repurchase, redemption, defeasance or other acquisition or
retirement for value of any Junior Indebtedness or Pari Passu
Indebtedness in exchange for, or out of the Net Cash Proceeds of,
a substantially concurrent issue and sale (other than to a
Subsidiary of the Company) of new Indebtedness by the Company
(such a transaction, a "refinancing"); provided, that any such
new Indebtedness of the Company (i) shall be in a principal
amount that does not exceed an amount equal to the sum of (A) the
principal amount of the Indebtedness so refinanced and accrued
but unpaid interest thereon less any discount from the face
amount of such Indebtedness to be refinanced expected to be
deducted from the amount payable to the holders of such
Indebtedness in connection with such refinancing, (B) the amount
of any premium expected to be paid in connection with such
refinancing pursuant to the terms of the Junior Indebtedness or
Pari Passu Indebtedness refinanced or the amount of any premium
reasonably determined by the Company as necessary to accomplish
such refinancing by means of a tender offer, privately negotiated
repurchase or otherwise and (C) the amount of legal, accounting,
printing and other similar expenses of the Company incurred in
connection with such refinancing; provided, further, that for
purposes of this clause (i), the principal amount of any
Indebtedness shall be deemed to mean the principal amount thereof
or, if such Indebtedness provides for an amount less than the
principal amount thereof to be due and payable upon a declaration
of acceleration thereof, such lesser amount as of the date of
determination; (ii) (A) if such refinanced Indebtedness has an
Average Life to Stated Maturity shorter than that of the Senior
Notes or a final Stated Maturity earlier than the final Stated
Maturity of the Senior Notes, such new Indebtedness shall have an
Average Life to Stated Maturity no shorter than the Average Life
to Stated Maturity of such refinanced Indebtedness and a final
Stated Maturity no earlier than the final Stated Maturity of such
refinanced Indebtedness or (B) in all other cases each Stated
Maturity of principal (or any required repurchase, redemption,
defeasance or sinking fund payments) of such new Indebtedness
shall be after the final Stated Maturity of principal of the
Senior Notes; and (iii) is (A) made expressly subordinated to or
13
pari passu with the Senior Notes to substantially the same
extent as the Indebtedness being refinanced or (B) expressly
subordinate to such refinanced Indebtedness.
"Permitted Repurchase Facilities" includes purchase and sale facilities
pursuant to which the Company or a Subsidiary sells loans, real estate owned or
other financial assets to a financial institution or other entity and agrees to
repurchase such loans, real estate owned or financial assets.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivisions thereof.
"Place of Payment" means the principal office of the Company in
Philadelphia, Pennsylvania, or the office of the Paying Agent as may be
established by the Company and the Trustee.
"Placement Memorandum" means the Company's Offering Memorandum, dated
July 16, 1997, as supplemented prior to the Issue Date, pursuant to which the
Original Senior Notes were initially offered.
"Predecessor Senior Note" of any particular Senior Note means every
previous Senior Note evidencing all or a portion of the same debt as that
evidenced by such particular Senior Note; and, for the purposes of this
definition, any Senior Note authenticated and delivered under Section 3.7 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Senior Note
shall be deemed to evidence the same debt as the mutilated, destroyed, lost or
stolen Senior Note.
"Preferred Stock" means, with respect to any Person, any Capital Stock
of any class or classes (however designated) which is preferred as to the
payment of dividends or distributions, or as to the distribution of assets upon
any voluntary liquidation or dissolution of such Person, over Capital Stock of
any other class in such Person.
"Purchase Agreement" means the Purchase Agreement, dated July 22, 1997,
among the Company, and the initial purchasers of the Original Senior Notes, as
such may be amended or modified from time to time.
"Qualified Capital Stock" of any Person means any and all Capital Stock
of such Person other than Disqualified Capital Stock.
"Redemption Date", when used with respect to any Senior Note to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Senior Note to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Reference Period" with regard to any Person means the four full fiscal
quarters of such Person ended on or immediately preceding any date upon which
any determination is to be made pursuant to the terms of the Senior Notes or
this Indenture for which financial information is available.
14
"Registrar" means the Trustee or its nominee.
"Registration Penalty" has the meaning set forth in the Registration
Rights Agreement.
"Registration Rights Agreement" means the Senior Notes Registration
Rights Agreement, dated as of July 22, 1997, by and among the Company and
Friedman, Billings, Xxxxxx & Co., Inc., as such may be amended or modified from
time to time.
"Regular Record Date" for the interest (including any Additional
Interest) payable on any Interest Payment Date on the Senior Notes means January
15 or July 15 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date.
"Responsible Officer", when used with respect to the Trustee shall mean
any officer within the corporate trust department (or any successor group of the
Trustee) including any vice president, assistant vice president, assistant
secretary, assistant treasurer or any other officer or assistant officer of the
Trustee customarily performing functions similar to those performed by the
persons who at the time shall be such officers, respectively, or to whom any
corporate trust matter is referred at the Trustee's Corporate Trust Office
because of his knowledge of and familiarity with the particular subject.
"Restricted Payment" means
(a) the declaration, payment or setting apart of any funds for the
payment of any dividend on, or making of any distribution to
holders of, the Capital Stock of the Company or any Subsidiary of
the Company (other than (i) dividends or distributions in
Qualified Capital Stock of the Company and (ii) dividends or
distributions payable on or in respect of any class or series of
Capital Stock of a Subsidiary of the Company as long as the
Company receives at least its pro rata share of such dividends or
distributions in accordance with its ownership interests in such
class or series of Capital Stock);
(b) the purchase, redemption or other acquisition or retirement for
value, directly or indirectly, of any Capital Stock of the
Company or any Affiliate of the Company (other than a
Wholly-Owned Subsidiary, and other than the purchase from a
non-Affiliate of the Company of Capital Stock of any joint
venture or other Person which is an Affiliate of the Company
solely because of the Company's direct or indirect ownership of
20% or more of the Voting Stock of such joint venture or other
Person), except such as shall constitute a Permitted Payment; or
(c) the making of any principal payments on, or repurchase,
redemption, defeasance, retirement or other acquisition for
value, directly or indirectly, of any Junior Indebtedness or Pari
Passu Indebtedness, prior to any Stated Maturity of principal or
scheduled redemption or defeasance of, or any scheduled sinking
fund payment on, such Junior Indebtedness or Pari Passu
Indebtedness, except such as shall constitute a Permitted
Payment.
"Restricted Security" means a Security, unless or until it has been (i)
effectively registered under the Securities Act and disposed of in accordance
with the registration statement covering
15
it or (ii) distributed to the public pursuant to Rule 144 (or any similar
provision then in force) under the Securities Act; provided that in no case
shall a Series B Senior Note issued in accordance with this Indenture and the
terms and provisions of the Senior Notes Registration Rights Agreement be a
Restricted Security.
"SEC" means the Securities and Exchange Commission.
"Securities" or "Senior Notes" means, prior to the Exchange Offer, the
Original Senior Notes, and after the Exchange Offer, the Original Senior Notes
(if any) and the Series B Senior Notes, in each case as amended or modified from
time to time in accordance with the terms hereof, issued under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Securitization Entity" means any pooling arrangement or entity formed
or originated for the purpose of holding, and/or issuing securities representing
interests in, one or more pools of mortgages, leases, credit card receivables,
home equity loan receivables, automobile loans, leases or installment sales
contracts, other consumer receivables, real estate owned or other financial
assets of the Company or any Subsidiary, and shall include, without limitation,
any partnership, limited liability company, liquidating trust, grantor trust,
owner trust, real estate mortgage investment conduit, real estate investment
trust or collateralized bond obligation.
"Senior Note Register" has the meaning specified in Section 3.6.
"Senior Notes": (See "Securities").
"Senior Notes Registration Rights Agreement": (See " Registration
Rights Agreement")
"Series B Senior Notes" means the Series B 12% Senior Notes due 2004,
to be issued pursuant to this Indenture in connection with the offer to exchange
Series B Senior Notes for Original Senior Notes that may be made by the Company
pursuant to the Senior Notes Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary of the Company which
accounted for 5% or more of the Consolidated Net Assets of the Company and its
Subsidiaries as of the end of the fiscal quarter preceding the date of
determination for which financial information is available or Consolidated
EBITDA of the Company and its Subsidiaries for the Reference Period.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.8.
"Stated Maturity" when used with respect to any Indebtedness
(including, without limitation, the Senior Notes) means the dates specified in
the instrument governing such Indebtedness as the fixed dates on which any
principal amount of such Indebtedness is due and payable (including, without
limitation, by reason of any required redemption, purchase, defeasance or
sinking fund payment) and, when used with respect to any installment of interest
on Indebtedness, means the date on which such installment is due and payable.
16
"Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the voting power
of Voting Stock thereof is at the time owned or controlled, directly or
indirectly, by such Person or one or more of the other Subsidiaries of such
Person or a combination thereof.
"Successor Company" has the meaning specified in Section 10.1.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder, and
if at any time there is more than one such Person, "Trustee" as used with
respect to the Senior Notes shall mean the Trustee with respect to the Senior
Notes.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force
at the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Unsecured Debt Coverage Ratio" means, with respect to any Person for
any period, the ratio of Consolidated EBITDA of such Person for such period to
the Fixed Charges of such Person for such period. In the event that the Company
incurs, assumes, guarantees or redeems any Indebtedness (including any
Indebtedness which constitutes Acquired Indebtedness) subsequent to the
commencement of the period for which the Unsecured Debt Coverage Ratio is being
calculated but prior to the event for which the calculation of the Unsecured
Debt Coverage Ratio is made (the "Calculation Date"), then the Unsecured Debt
Coverage Ratio shall be calculated giving pro forma effect to such incurrence,
assumption, guarantee or redemption of Indebtedness, as if the same had occurred
at the beginning of the applicable four-quarter period, including an assumption
of investment returns at the rate equal to the higher of the six-month Treasury
bill rate or six-month LIBOR at the beginning of such four-quarter period. For
purposes of making the computation referred to above, investments in the equity
of, or other acquisitions or dispositions, which constitute all or substantially
all of an operating unit of a business and discontinued operations (as
determined in accordance with GAAP) that have been made by the Company or any of
its Subsidiaries, including all mergers, consolidations and dispositions, during
the four-quarter reference period or subsequent to such reference period and on
or prior to the Calculation Date shall be calculated on a pro forma basis
assuming that all such investments, acquisitions, dispositions, discontinued
operations, mergers and consolidations (and the reduction of any associated
fixed charge obligations and the change in Consolidated EBITDA resulting
therefrom) had occurred on the first day of the four-quarter period. If since
the beginning of such period any Person (that subsequently became a Subsidiary
or was merged with or into the Company or any Subsidiary since the beginning of
such period) shall have made any investment in the equity of, or other
acquisition or disposition, which constitutes all or substantially all of an
operating unit of a business, discontinued operation, merger or consolidation
that would have required adjustment pursuant to this definition, then the
Unsecured Debt Coverage Ratio shall be calculated giving pro forma effect
thereto for such period as if such investment, acquisition, disposition,
discontinued operation, merger or consolidation had occurred at the beginning of
the applicable four-quarter period. For purposes of this definition, whenever
pro forma effect is to be given to a transaction, the pro forma calculations
shall be made in good faith by a responsible financial or accounting officer of
the Company. If any Indebtedness bears a floating rate of interest and is being
given pro forma effect, the interest on such Indebtedness
17
shall be calculated as if the rate in effect on the Calculation Date had been
the applicable rate for the entire period. Interest on a Capital Lease
Obligation shall be deemed to accrue at an interest rate reasonably determined
by a responsible financial or accounting officer of the Company to be the rate
of interest implicit in such Capital Lease Obligation in accordance with GAAP.
Interest on Indebtedness that may optionally be determined at an
interest rate based upon a factor of a prime or similar rate, a reoccurrence
interbank offered rate, or other rate, shall be deemed to have been based upon
the rate actually chosen, or, if none, then based upon such optional rate chosen
as the Company may designate.
"U.S. Government Obligations" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and
which are not callable at the issuer's option.
"Vice President", when used with respect to the Company or the Trustee,
means any vice president (but shall not include any assistant vice president),
whether or not designated by a number or a word or words added before or after
the title "vice president".
"Voting Stock" means Capital Stock of the class or classes of which the
holders have (i) in respect of a corporation, the general voting power under
ordinary circumstances to elect at least a majority of the board of directors,
managers or trustees of such corporation (irrespective of whether or not at the
time Capital Stock of any other class or classes shall have or might have voting
power by reason of the happening of any contingency) or (ii) in respect of a
partnership, the general voting power under ordinary circumstances to elect the
board of directors or other governing board of such partnership or of the Person
which is a general partner of such partnership.
"Wholly-Owned Subsidiary" means a Subsidiary all of the Capital Stock
of which (other than directors' qualifying shares) is owned by the Company or
another Wholly-Owned Subsidiary.
SECTION 1.2 Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by officers of the Company, or an Opinion
of Counsel, if to be given by counsel, and shall comply with the requirements of
the Trust Indenture Act and any other requirements set forth in this Indenture.
Every certificate or opinion (other than the Officers' Certificate
delivered under Section 9.4 hereof) with respect to compliance with a condition
or covenant provided for in this Indenture shall include:
(1) a statement that each individual signing such
certificate or opinion has read such covenant or
condition and the definitions herein relating
thereto;
18
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the
statements or opinions contained in such certificate
or opinion are based;
(3) a statement that, in the opinion of each such
individual, he has made such examination or
investigation as is necessary to enable him to
express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been
complied with.
SECTION 1.3 Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4 Acts of Holders, Record Dates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or
taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders
in person or by agent duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become
effective upon action by the requisite percentage of Holders when
such instrument or instruments are delivered to the Trustee and,
where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act"
of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any
such agent shall be sufficient for any
19
purpose of this Indenture and (subject to Section 6.1)
conclusive in favor of the Trustee and the Company, if made in
the manner provided in this Section.
Without limiting the generality of the foregoing, a Holder, including a
Depositary that is a Holder of a Global Senior Note, may make, give or take, by
a proxy, or proxies, duly appointed in writing, any request, demand,
authorization, direction, notice, consent, waiver or other action provided or
permitted in this Indenture to be made, given or taken by Holders, and a
Depositary that is a Holder of a Global Senior Note may provide its proxy or
proxies to the beneficial owners of interest in any such Global Senior Note.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness
of such execution or by a certificate of a notary public or other
officer authorized by law to take acknowledgments of deeds,
certifying that the individual signing such instrument or writing
acknowledged to him the execution thereof.
Where such execution is by a signer acting in a capacity other than his
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority. The fact and date of the execution of any
such instrument or writing, or the authority of the Person executing the same,
may also be proved in any other manner which the Trustee deems sufficient.
(c) The Company may, in the circumstances permitted by the Trust
Indenture Act, fix any day as the record date for the purpose of
determining the Holders of Senior Notes entitled to give or take
any request, demand, authorization, direction, notice, consent,
waiver or other action, or to vote on any action, authorized or
permitted to be given or taken by Holders of Senior Notes. If not
set by the Company prior to the first solicitation of a Holder of
Senior Notes made by any Person in respect of any such action,
or, in the case of any such vote, prior to such vote, the record
date for any such action or vote shall be the 30th day (or, if
later, the date of the most recent list of Holders required to be
provided pursuant to Section 7.1) prior to such first
solicitation or vote, as the case may be. With regard to any
record date for action to be taken by the Holders Senior Notes,
only the Holders of Senior Notes on such date (or their duly
designated proxies) shall be entitled to give or take, or vote
on, the relevant action.
(d) The ownership of Senior Notes shall be proved by the Senior Note
Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Senior Note shall bind
every future Holder of the same Senior Note and the Holder of
every Senior Note issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such
action is made upon such Senior Note.
(f) Without limiting the foregoing, a Holder entitled hereunder to
give or take any action hereunder with regard to any particular
Senior Note may do so with regard to all or any part of the
principal amount of such Senior Note or by one or more duly
appointed agents each of which may do so pursuant to such
appointment with regard to all or any different part of such
principal amount.
20
SECTION 1.5 Notices, Etc., to Trustee and Company.
Except as otherwise expressly provided herein, any request, demand,
authorization, direction, notice, consent, waiver or Act of Holders or other
document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in
writing to or with the Trustee at its Corporate Trust Office,
Attention: Corporate Trust Trustee Administration, or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid,
to the Company addressed to it at the address of the Company's
principal office specified in the first paragraph of this
instrument or at any other address previously furnished in
writing to the Trustee by the Company, Attention: Xxxxxx X.
Xxxxx, Chairman.
SECTION 1.6 Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Senior Note Register, not
later than the latest date (if any), and not earlier than the earliest date (if
any), prescribed for the giving of such notice. In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders. Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
Person entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Trustee, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
SECTION 1.7 Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act that is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
that may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
SECTION 1.8 Effect of Headings and Table of Contents.
21
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.9 Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 1.10 Separability Clause.
In case any provision in this Indenture or in the Senior Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 1.11 Benefits of Indenture.
Nothing in this Indenture or in the Senior Notes, express or implied,
shall give to any Person, other than (a) the parties hereto and their successors
hereunder and (b) the Holders, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
SECTION 1.12 Governing Law; Choice of Forum.
(a) This Indenture and the Senior Notes will be governed by, and
construed in accordance with, the laws of the State of New York
without giving effect to applicable principles of conflicts of
law to the extent that the application of the law of another
jurisdiction would be required thereby.
(b) The Company hereby irrevocably submits to the jurisdiction of any
New York State Court sitting in the Borough of Manhattan in the
City of New York or any federal court sitting in the Borough of
Manhattan in the City of New York in respect of any suit, action
or proceeding arising out of or relating to this indenture and
the Senior Notes, and irrevocably accepts for itself and in
respect of its property, generally and unconditionally,
jurisdiction of the aforesaid courts. The company irrevocably
waives, to the fullest extent it may effectively do so under
applicable law, any objection which it may now or hereafter have
to the laying of the venue of any such suit, action or proceeding
brought in any such court and any claim that any such suit,
action or proceeding brought in any such court has been brought
in an inconvenient forum.
(c) The Company hereby irrevocably appoints [CT Corporation Systems]
(the "Process Agent," which has consented thereto) with offices
on the date hereof at [0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000]
as Process Agent to receive for and on behalf of the Company
service of process in the County of New York relating to this
Indenture and the Senior Notes. SERVICE OF PROCESS IN ANY SUIT,
ACTION OR PROCEEDING AGAINST THE COMPANY MAY BE
22
MADE ON THE PROCESS AGENT BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR
UNDER APPLICABLE LAWS IN EFFECT IN THE STATE OF NEW YORK, AND THE
PROCESS AGENT IS HEREBY AUTHORIZED AND DIRECTED TO ACCEPT SUCH
SERVICE FOR AND ON BEHALF OF THE COMPANY AND TO ADMIT SERVICE
WITH RESPECT THERETO. SUCH SERVICE UPON THE PROCESS AGENT SHALL
BE DEEMED EFFECTIVE PERSONAL SERVICE ON THE COMPANY, SUFFICIENT
FOR PERSONAL JURISDICTION, 10 DAYS AFTER MAILING, AND SHALL BE
LEGAL AND BINDING UPON THE COMPANY FOR ALL PURPOSES,
NOTWITHSTANDING ANY FAILURE OF THE PROCESS AGENT TO MAIL COPIES
OF SUCH LEGAL PROCESS TO THE COMPANY OR ANY FAILURE ON THE PART
OF THE COMPANY TO RECEIVE THE SAME. The Company confirms that it
has instructed the Process Agent to mail to the Company, upon
service of process being made on the Process Agent pursuant to
this Section, a copy of the summons and complaint or other legal
process served upon it, by registered mail, return receipt
requested, at the Company's address set forth in the first
paragraph of this instrument, or to such other address as the
Company may notify the Process Agent in writing. The Company
agrees that it will at all times maintain a process agent to
receive service of process in the County of New York on its
behalf with respect to this Indenture and the Senior Notes. If
for any reason the Process Agent or any successor thereto shall
no longer serve as such process agent or shall have changed its
address without notification thereof to the Trustee, the Company,
immediately after gaining knowledge thereof, irrevocably shall
appoint a substitute process agent acceptable to the Trustee in
the County of New York and advise the Trustee thereof or notify
the Trustee of the new address, respectively.
(d) NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE TRUSTEE OR ANY
HOLDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE
COMPANY IN ANY OTHER JURISDICTION.
SECTION 1.13 Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Senior Note shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the Senior
Notes (other than a provision of the Senior Notes which specifically states that
such provision shall apply in lieu of this Section)) payment of interest
(including any Additional Interest) or principal (and premium, if any) need not
be made at such Place of Payment on such date, but may be made on the next
succeeding Business Day at such Place of Payment with the same force and effect
as if made on the Interest Payment Date or Redemption Date, or at the Stated
Maturity, provided that no interest shall accrue with respect to such payment
for the period from and after such Interest Payment Date, Redemption Date or
Stated Maturity, as the case may be.
23
ARTICLE TWO
SENIOR NOTE FORMS
SECTION 2.1 Forms Generally.
The Senior Notes shall be in substantially the form set forth in this
Article, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Senior Notes, as evidenced by their execution of the
Senior Notes.
The definitive Senior Notes shall be printed, lithographed or engraved
on steel engraved borders or may be produced in any other manner, all as
determined by the officers of the Company executing such Senior Notes, as
evidenced by their execution of such Senior Notes.
SECTION 2.2 Form of Face of Senior Note.
[If the Security is a Restricted Security, such as an Original Senior
Note, then insert -- THE NOTE EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE OR UNLESS A REGISTRATION STATEMENT UNDER THE SECURITIES ACT IS IN
EFFECT WITH RESPECT TO THIS NOTE. BY ITS ACQUISITION HEREBY (BUT SUBJECT TO
CERTAIN RIGHTS TO REQUIRE REGISTRATION OF THE NOTES), THE HOLDER (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE
501 UNDER THE SECURITIES ACT) ("ACCREDITED INVESTOR") (2) AGREES THAT IT WILL
NOT WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THE NOTE EVIDENCED HEREBY
RESELL OR OTHERWISE TRANSFER THE NOTE EVIDENCED HEREBY EXCEPT IN A TRANSACTION
NOT REQUIRING REGISTRATION UNDER THE SECURITIES ACT (A) TO RESOURCE AMERICA,
INC. OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) TO AN ACCREDITED
INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE UNDER THE
INDENTURE RELATING TO THIS NOTE (THE "TRUSTEE") A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTION ON TRANSFER
OF THE NOTES EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE
TRUSTEE), (D) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT INCLUDING THE EXEMPTION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT (IF AVAILABLE); AND (3) AGREES THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND, IN CONNECTION WITH ANY TRANSFER OF THE NOTE EVIDENCED
HEREBY WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF SUCH NOTE. IF THE
PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH
TRANSFER, FURNISH TO THE TRUSTEE SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER
INFORMATION AS THE COMPANY OR THE TRUSTEE MAY REASONABLY REQUIRE TO CONFIRM THAT
SUCH
24
TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
[All Securities, including Series B Senior Notes, shall be in
substantially the following form] NO EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO
TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") (EACH, A "PLAN"), NO ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN
ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY (A "PLAN ASSET
ENTITY"), AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN, MAY ACQUIRE OR HOLD
THIS SECURITY OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS
ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR
PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 96-23, 95-60, 91-38, 90-1 OR
84-14 WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THIS
SECURITY OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS
PURCHASE AND HOLDING THEREOF THAT IT EITHER (A) IS NOT A PLAN OR A PLAN ASSET
ENTITY AND IS NOT PURCHASING THIS SECURITY ON BEHALF OF OR WITH "PLAN ASSETS" OF
ANY PLAN OR (B) IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER PTCE 96-23,
95-60, 91-38, 90-1 OR 84-14 WITH RESPECT TO SUCH PURCHASE OR HOLDING.
25
RESOURCE AMERICA, INC.
12% Senior Notes Due 2004
No____________ $___________
CUSIP No. ____________
Resource America, Inc., a corporation duly organized and existing under
the laws of Delaware (herein called the "Company", which term includes any
Successor Company under the Indenture hereinafter referred to), for value
received, hereby promises to pay to ____________________, or registered assigns,
the principal sum of ___________ Dollars on August 1, 2004, and to pay
interest thereon from July 22, 1997 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, semi-annually
in arrears on February 1 and August 1 in each year, commencing February 1, 1998,
at the rate of 12% per annum, plus Additional Interest, if any, until the
principal hereof is paid or made available for payment, and at the rate of 1%
over the rate set forth above per annum on any overdue principal and (to the
extent that the payment of such interest shall be legally enforceable) on any
overdue installment of interest. 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 Senior Note (or one or more
Predecessor Senior Notes) is registered at the close of business on the Regular
Record Date for such interest, which shall be January 15 or July 15 (whether or
not a Business Day), as the case may be, next preceding such Interest Payment
Date. Any such interest (including any Additional Interest) not so punctually
paid or duly provided for will forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in whose name this
Senior Note (or one or more Predecessor Senior Notes) 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 Holders of Senior
Notes 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 Senior Notes may be listed, and upon such
notice as may be required by such exchange, all as more fully provided in said
Indenture. Interest on the Senior Notes shall be computed on the basis of a
360-day year of twelve 30-day months.
The principal of, and premium, if any, and interest including
Additional Interest, if any, on the Senior Notes shall be payable at the
principal office of the Company in Philadelphia, Pennsylvania or at the office
of the Paying Agent as may be established by the Company and the Trustee (herein
called the "Place of Payment"; initially the Place of Payment shall be the
principal corporate trust office of the Trustee in New York, New York). All such
payments shall be made in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts; provided, however, that at the option of the Company, payment of interest
may be made (subject to collection) by check mailed to the address of the Person
entitled thereto at such address as shall appear on the Note Register or by wire
transfer in immediately available funds to the accounts designated by the Person
entitled thereto in writing in form satisfactory to the Trustee at least fifteen
(15) days prior to the date of such payment.
Reference is hereby made to the further provisions of this Senior Note
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
26
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Senior
Note shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
RESOURCE AMERICA, INC.
By: _____________________________
Attest:
_____________________________
27
SECTION 2.3 Form of Reverse of Senior Note.
This Senior Note is one of a duly authorized issue of the Company
(herein called the "Senior Notes"), issued under an Indenture, dated as of
July 22, 1997 (herein called the "Indenture"), between the Company and The
Bank of New York as Trustee (herein called the "Trustee", which term includes
any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee and the Holders of the Senior Notes and of the terms
upon which the Senior Notes are, and are to be, authenticated and delivered.
This Senior Note is one of the Senior Notes designated on the face hereof,
limited in aggregate principal amount up to $75,000,000.
The Senior Notes may not be redeemed prior to August 1, 2002 except
as set forth herein. On or after such date, the Senior Notes may be redeemed
upon not less than 30 days' and not more than 60 days' notice by mail, at any
time on or after August 1, 2002, as a whole or in part, at the election of
the Company, at the following Redemption Prices (expressed as percentages of the
principal amount): If redeemed during the 12-month period beginning August 1,
of the years indicated,
Redemption
Year Price
---- -----------
2002 106%
2003 103%
together in the case of any such redemption with accrued and unpaid interest
(including any Additional Interest) to the Redemption Date, but interest
installments whose Stated Maturity is on or prior to such Redemption Date will
be payable to the Holders of such Senior Notes, or one or more Predecessor
Senior Notes, of record at the close of business on the relevant Regular Record
Dates referred to on the face hereof, all as provided in the Indenture.
In the event of redemption of this Senior Note in part only, a new
Senior Note or Senior Notes of like tenor for the unredeemed portion hereof will
be issued in the name of the Holder hereof upon the cancellation hereof.
Upon a Change of Control Event, the Holder of this Senior Note will
have the right to cause the Company to repurchase all or any part of this Senior
Note at a repurchase price equal to 101% of the principal amount of this Senior
Note plus accrued interest (including any Additional Interest) to the date of
purchase (subject to the right of the Holders on the relevant Regular Record
Date to receive interest due on the relevant Interest Payment Date) as provided
in, and subject to the terms of, the Indenture.
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness evidenced by this Senior Note and (b) certain restrictive
covenants, in each case upon compliance by the Company with certain conditions
set forth therein, which provisions apply to this Senior Note.
28
If an Event of Default with respect to Senior Notes shall occur and be
continuing, the principal of the Senior Notes may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Senior Notes at any time by the
Company and the Trustee with the consent of the Holders of a majority in
principal amount of the Senior Notes at the time Outstanding. The Indenture also
contains provisions permitting the Holders of specified percentages in principal
amount of the Senior Notes at the time Outstanding, on behalf of the Holders of
all Senior Notes, to waive certain past defaults under the Indenture and their
consequences. Any such consent or waiver shall be conclusive and binding upon
the Holder of this Senior Note and upon all future Holders of this Senior Note
and of any Senior Note issued upon the registration of transfer hereof or in
exchange therefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Senior Note.
No reference herein to the Indenture and no provision of this Senior
Note or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of and any premium and
interest (including any Additional Interest) on this Senior Note at the times,
place and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Senior Note is registrable in the Senior Note
Register, upon surrender of this Senior Note for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest (including any Additional Interest) on this Senior Note are
payable, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Senior Note Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Senior Notes of like tenor, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or
transferees.
The Senior Notes are issuable only in registered form without coupons
in denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, Senior Notes are
exchangeable for a like aggregate principal amount of Senior Notes of like tenor
of a different authorized denomination, as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Senior Note for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Senior Note is registered as the owner
hereof for all purposes, whether or not this Senior Note be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
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All terms used in this Senior Note which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
The Indenture and the Senior Notes will be governed by, and construed
in accordance with, the laws of the State of New York without giving effect to
applicable principles of conflicts of law to the extent that the application of
the law of another jurisdiction would be required.
SECTION 2.4 Form of Legend for Global Senior Notes.
Any Global Senior Note authenticated and delivered hereunder shall bear
a legend in substantially the following form:
"This Senior Note is a Global Senior Note within the meaning
of the Indenture hereinafter referred to and is registered in the name
of a Depositary or a nominee thereof. This Senior Note may not be
transferred to, or registered or exchanged for Senior Notes registered
in the name of, any Person other than the Depositary or a nominee
thereof or a successor of such Depositary or a nominee of such
successor and no such transfer may be registered, except in the limited
circumstances described in the Indenture. Every Senior Note
authenticated and delivered upon registration of transfer of, or in
exchange for or in lieu of, this Senior Note shall be a Global Senior
Note subject to the foregoing, except in such limited circumstances."
SECTION 2.5 Legending of the Securities; Restrictions on Transfers.
Until such time as the same is no longer a Restricted Security, each
certificate evidencing the Securities (and all Securities issued in exchange
therefor or substitution thereof) shall bear a legend in substantially the form
set forth on the form of Senior Note set forth at Section 2.2. Prior to any
transfer or exchange of a legended Security for another Security, the Company
shall deliver an Officers' Certificate to the Trustee directing it to transfer
or exchange such Security for another legended or unlegended Security, subject
to compliance with any transfer restrictions.
SECTION 2.6 Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially
the following form:
This is one of the Senior Notes designated and referred to in the
within-mentioned Indenture.
The Bank of New York, as Trustee
Dated: ___________________ By: _______________________________
Authorized Signatory
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SECTION 2.7 Form of Assignment and Election to Purchase.
Each Senior Note shall include the following form of Assignment and
Option of Holder to Elect Purchase:
ASSIGNMENT
(To be executed by the registered Holder if such
Holder desires to transfer this Senior Note)
FOR VALUE RECEIVED _____________ hereby sells, assigns and transfers
unto ________________________.
PLEASE INSERT SOCIAL SECURITY OR OTHER TAX IDENTIFYING NUMBER OF TRANSFEREE
__________________________________________________
(Please print name and address of transferee)
this Senior Note, together with all right, title and interest herein, and does
hereby irrevocably constitute and appoint ___________________ Attorney to
transfer this Senior Note on the Senior Note Register, with full power of
substitution.
Dated: __________________________________
Signature
of Holder: ____________________________
Signature
Guaranteed: ___________________________
NOTICE: The signature to the foregoing Assignment must correspond to the name as
written upon the face of this Senior Note in every particular, without
alteration or any change whatsoever.
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OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
[ ] In connection with the Change of Control Purchase Offer made pursuant
to Section 9.17 of the Indenture, the undersigned hereby elects to have
the entire principal amount
[ ] $ _______________ ($1,000 in principal amount or an integral multiple
thereof) principal amount of this Senior Note repurchased by the
Company. The undersigned hereby directs the Trustee or Paying Agent to
pay it an amount in cash equal to 101% of the principal amount
indicated in the preceding sentence plus accrued and unpaid interest on
such principal amount to the date of purchase.
Dated: __________________________________
Signature
of Holder: ____________________________
Signature
Guaranteed: ___________________________
NOTICE: The signature to the foregoing must correspond to the name as written
upon the face of this Senior Note in every particular, without
alteration or any change whatsoever.
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ARTICLE THREE
THE SENIOR NOTES
SECTION 3.1 Global Senior Note; Depositary.
Any Senior Notes issued in the form of one or more Global Senior Notes
will be deposited with The Depository Trust Company or any successor thereto
(the "Depositary"), or the Trustee on its behalf, and registered in the name of
the Depositary's nominee, as nominee of the Depositary (such nominee being
referred to herein as the "Global Senior Note Holder").
SECTION 3.2 Amount.
The aggregate principal amount of Senior Notes which may be
authenticated and delivered under this Indenture is up to $75,000,000
(Seventy-Five Million Dollars and No Cents), except for Senior Notes
authenticated and delivered pursuant to Section 3.5, 3.6, 3.7, 9.16 or 11.7.
SECTION 3.3 Denominations.
The Senior Notes shall be issuable in registered form without coupons
in denominations of $1,000 and any integral multiple thereof.
SECTION 3.4 Execution, Authentication, Delivery and Dating.
The Senior Notes shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its Chief Executive
Officer, its President or one of its Vice Presidents, under its corporate seal,
if any, reproduced thereon attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers on the Senior Notes and the
corporate seal may be manual or facsimile.
Senior Notes bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Senior Notes or did not
hold such offices at the date of such Senior Notes.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Senior Notes executed by the Company to
the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Senior Notes, and the Trustee in accordance
with the Company Order shall authenticate and make such Senior Notes available
for delivery.
Each Senior Note shall be dated the date of its authentication.
No Senior Note shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Senior Note
a certificate of authentication substantially in the form provided for herein
executed by the Trustee or an Authenticating Agent by manual signature of an
authorized signatory of the Trustee or an Authenticating Agent, and
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such certificate upon any Senior Note shall be conclusive evidence, and the only
evidence, that such Senior Note has been duly authenticated and delivered
hereunder.
Notwithstanding the foregoing, if any Senior Note shall have been
authenticated and delivered hereunder but never issued and sold by the Company,
and the Company shall deliver such Senior Note to the Trustee for cancellation
as provided in Section 3.10, for all purposes of this Indenture such Senior Note
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits of this Indenture.
SECTION 3.5 Temporary Senior Notes.
Pending the preparation of definitive Senior Notes, the Company may
execute, and upon Company Order the Trustee shall authenticate and make
available for delivery, temporary Senior Notes which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Senior Notes in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Senior Notes may determine, as
evidenced by their execution of such Senior Notes.
If temporary Senior Notes are issued, the Company will cause definitive
Senior Notes to be prepared without unreasonable delay. After the preparation of
definitive Senior Notes, the temporary Senior Notes shall be exchangeable for
definitive Senior Notes upon surrender of the temporary Senior Notes at the
office or agency of the Company in a Place of Payment, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Senior
Notes the Company shall execute and the Trustee shall authenticate and make
available for delivery in exchange therefor one or more definitive Senior Notes
of any authorized denominations and of a like aggregate principal amount and
tenor. Until so exchanged the temporary Senior Notes shall in all respects be
entitled to the same benefits under this Indenture as definitive Senior Notes of
such tenor.
SECTION 3.6 Registration; Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office a
register (the register maintained in such office being herein sometimes
collectively referred to as the "Senior Note Register"), in which, subject to
such reasonable regulations as it may prescribe, the Company shall provide for
the registration of Senior Notes and of transfers of Senior Notes. The Trustee
is hereby appointed "Senior Note Registrar" for the purpose of registering
Senior Notes and transfers of Senior Notes as herein provided.
Upon surrender for registration of transfer of any Senior Note at the
office or agency in a Place of Payment, the Company shall execute, and the
Trustee shall authenticate and make available for delivery, in the name of the
designated transferee or transferees, one or more new Senior Notes of any
authorized denominations and of a like aggregate principal amount and tenor.
At the option of the Holder, Senior Notes may be exchanged for other
Senior Notes of any authorized denominations and of a like aggregate principal
amount and tenor, upon surrender of the Senior Notes to be exchanged at such
office or agency.
34
Whenever any Senior Notes are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and make available for
delivery, the Senior Notes which the Holder making the exchange is entitled to
receive.
All Senior Notes issued upon any registration of transfer or exchange
of Senior Notes shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as the Senior
Notes surrendered upon such registration of transfer or exchange.
Every Senior Note presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Senior Note Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Senior Notes, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Senior Notes, other
than exchanges pursuant to Section 3.5, 9.16 or 11.7 not involving any transfer.
The Company shall not be required (i) to issue, register the transfer
of or exchange Senior Notes during a period beginning at the opening of business
15 days before the day of the mailing of a notice of redemption of Senior Notes
selected for redemption under Section 11.3 and ending at the close of business
on the day of such mailing or (ii) to register the transfer of or exchange any
Senior Note so selected for redemption in whole or in part, except the
unredeemed portion of any Senior Note being redeemed in part.
Any Original Senior Notes which are presented to the Registrar for
exchange pursuant to an Exchange Offer shall be exchanged for Series B Senior
Notes of equal principal amount upon surrender to the Registrar of the Original
Senior Notes to be exchanged; provided, however, that the Original Senior Notes
surrendered for exchange in an Exchange Offer shall be duly endorsed and
accompanied by a letter of transmittal or written instrument of transfer in form
satisfactory to the Company, the Trustee and the Registrar, duly executed by the
Holder thereof or his attorney who shall be duly authorized in writing to
execute such document. Whenever any Original Senior Notes are so surrendered for
exchange, the Company shall execute, and the Trustee shall, upon Company Order,
authenticate and make available for delivery to the Registrar, the same
aggregate principal amount of Series B Senior Notes as the aggregate principal
amount of Original Senior Notes that have been surrendered.
Notwithstanding any other provisions hereof, no Original Senior Note
may be exchanged by the Holder thereof for a Series B Senior Note other than
pursuant to the Exchange Offer and no Series B Senior Note may be exchanged by
the Holder thereof for an Original Senior Note.
Each Holder of a Senior Note agrees to indemnify the Company and the
Trustee against any liability that may result from the transfer, exchange or
assignment of such Xxxxxx's Senior Note in violation of any provision of this
Indenture and/or applicable United States federal or state securities law.
35
The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among Depositary
participants or beneficial owners of interests in any Global Security) other
than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and when expressly
required by the terms of, this Indenture, and to examine the same to determine
substantial compliance as to form with the express requirements hereof.
SECTION 3.7 Mutilated, Destroyed, Lost and Stolen Senior Notes.
If any mutilated Senior Note is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and make available for delivery
in exchange therefor a new Senior Note of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Senior Note and
(ii) such security or indemnity as may be required by them to save each of them
and any agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Senior Note has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and make
available for delivery, in lieu of any such destroyed, lost or stolen Note, a
new Senior Note of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Senior Note has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Senior Note, pay such Senior Note.
Upon the issuance of any new Senior Note under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Senior Note issued pursuant to this Section in lieu of any
destroyed, lost or stolen Senior Note shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Senior Note shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Senior Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Senior Notes.
SECTION 3.8 Payment of Interest; Interest Rights Preserved.
Interest (including any Additional Interest) on any Senior Note which
is payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name that Senior Note (or one or more
Predecessor Senior Notes) is registered at the close of business on the Regular
Record Date for such interest. All payments of interest
36
(including any Additional Interest) on any Senior Notes shall be made by the
Company in immediately available funds; provided, however, that should, in
accordance with the terms of the Indenture, interest (including any Additional
Interest) on the Senior Notes not be paid in immediately available funds, such
payment may be paid by check drawn on a bank in The City of New York and mailed
to the address of the Person entitled thereto as such address shall appear in
the Senior Note Register.
Any interest (including any Additional Interest) on any Senior Note
which is payable, but is not punctually paid or duly provided for, on any
Interest Payment Date (herein called "Defaulted Interest") shall forthwith cease
to be payable to the Holder on the relevant Regular Record Date by virtue of
having been such Holder, and such Defaulted Interest may be paid by the Company,
at its election in each case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the
Senior Notes (or their respective Predecessor Senior
Notes) are registered at the close of business on a
Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following
manner. The Company shall notify the Trustee in
writing of the amount of Defaulted Interest proposed
to be paid on each Senior Note and the date of the
proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such
deposit prior to the date of the proposed payment,
such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted
Interest as in this clause provided. Thereupon the
Trustee shall fix a Special Record Date for the
payment of such Defaulted Interest which shall be not
more than 15 days and not less than 7 days prior to
the date of the proposed payment and not less than 7
days after the receipt by the Trustee of the notice
of the proposed payment. The Trustee shall promptly
notify the Company of such Special Record Date and,
in the name and at the expense of the Company, shall
cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid,
to each Holder of Senior Notes at its address as it
appears in the Senior Note Register, not less than 10
days prior to such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the
Special Record Date therefor having been so mailed,
such Defaulted Interest shall be paid to the Persons
in whose names the Senior Notes (or their respective
Predecessor Senior Notes) are registered at the close
of business on such Special Record Date and shall no
longer be payable pursuant to the following clause
(2).
(2) The Company may make payment of any Defaulted
Interest on the Senior Notes in any other lawful
manner not inconsistent with the requirements of any
securities exchange on which such Senior Notes may be
listed, and upon such notice as may be required by
such exchange, if, after notice given by the Company
to the Trustee of the proposed payment pursuant to
this clause, such manner of payment shall be deemed
practicable by the Trustee.
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Subject to the foregoing provisions of this Section, each Senior Note
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Senior Note shall carry the rights to interest
(including any Additional Interest) accrued and unpaid, and to accrue, which
were carried by such other Senior Note.
SECTION 3.9 Persons Deemed Owners.
Prior to due presentment of a Senior Note for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Senior Note is registered as the owner of such
Senior Note for the purpose of receiving payment of principal of and any premium
and (subject to Section 3.8) any interest (including any Additional Interest) on
such Senior Note and for all other purposes whatsoever, whether or not such
Senior Note be overdue, and neither the Company, the Trustee nor any agent of
the Company or the Trustee shall be affected by notice to the contrary.
So long as the Global Senior Note Holder is the registered owner of any
Senior Notes, the Global Senior Note Holder will be considered the sole Holder
under this Indenture of any Senior Notes evidenced by the Global Senior Note for
the purposes of receiving payment on the Senior Notes, receiving notices, and
for all other purposes under this Indenture and the Senior Notes. Beneficial
owners of Senior Notes evidenced by the Global Senior Note will not be
considered the owners or Holders thereof under this Indenture for any purpose,
including with respect to the giving of any directions, instructions or
approvals to the Trustee thereunder. Neither the Company nor the Trustee will
have any responsibility or liability for any aspect of the records of the
Depositary or for maintaining, supervising or reviewing any records of the
Depositary relating to the Senior Notes.
SECTION 3.10 Cancellation.
All Senior Notes surrendered for payment, redemption or registration of
transfer or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly canceled by it. The Company
may at any time deliver to the Trustee for cancellation any Senior Notes
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and may deliver to the Trustee (or to any
other Person for delivery to the Trustee) for cancellation any Senior Notes
previously authenticated hereunder which the Company has not issued and sold,
and all Senior Notes so delivered shall be promptly canceled by the Trustee. No
Senior Notes shall be authenticated in lieu of or in exchange for any Senior
Notes canceled as provided in this Section, except as expressly permitted by
this Indenture. All canceled Senior Notes held by the Trustee shall be promptly
returned to the Company.
SECTION 3.11 Computation of Interest.
Interest on the Senior Notes shall be computed on the basis of a
360-day year of twelve 30-day months.
SECTION 3.12 CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption or other related
38
material as a convenience to Holders; provided that any such notice or other
related material may state that no representation is made as to the correctness
of such numbers either as printed on the Securities or as contained in any
notice of redemption or other related material and that reliance may be placed
only on the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Company shall promptly notify the Trust of any change in the "CUSIP"
numbers.
ARTICLE FOUR
BOOK-ENTRY PROVISIONS FOR GLOBAL SENIOR NOTES
SECTION 4.1 Applicability of Article.
Each Global Senior Note shall be subject to this Article Four.
SECTION 4.2 Book-Entry Provisions For Global Senior Note.
(a) Members of, or participants in, the Depositary ("Agent Members")
shall have no rights under this Indenture with respect to any
Global Senior Note held on their behalf by the Depositary or
under the Global Senior Note, and the Depositary may be treated
by the Company, the Trustee and any agent of the Company or the
Trustee as the absolute owner of the Global Senior Note for all
purposes whatsoever. Any Holder of the Global Senior Note shall,
by acceptance of such Global Senior Note, agree that the
transfers of beneficial interests in such Global Senior Note may
be effected only through a book-entry system maintained by the
Depositary (or its agent), and that ownership of a beneficial
interest in the Global Senior Note shall be required to be
reflected in a book-entry system. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or an agent
of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the
Depositary or impair, as between the Depositary and its Agent
Members, the operation of customary practices governing the
exercise of the rights of a Holder of any Senior Note.
(b) Notwithstanding any other provision of this Section, unless and
until it is exchanged in whole or in part for individual Senior
Notes represented thereby, a Global Senior Note representing all
or a portion of the Senior Notes may not be transferred except as
a whole by the Depositary to a nominee of such Depositary or by a
nominee of such Depositary to such Depositary or another nominee
of such Depositary or by such Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
Interests of beneficial owners in the Global Senior Notes (each
an "Interest") may be transferred to one beneficial owner or to
another Agent Member or exchanged for definitive Senior Notes in
accordance with the rules and procedures of the Depositary and
the provisions of this Indenture. In addition, definitive Senior
Notes shall be transferred to all beneficial owners in exchange
for their beneficial interests in
39
Global Senior Notes if (i) the Depositary for the Senior Notes
notifies the Company that the Depositary is unwilling or unable
to continue as Depositary for the Global Senior Notes or is no
longer eligible to serve as Depositary pursuant to the terms of
this Indenture and a successor Depositary is not appointed by the
Company within 90 days after delivery of such notice; (ii) the
Company, at its sole discretion, notifies the Trustee in writing
that it elects to cause the issuance of definitive Senior Notes
under this Indenture; or (iii) there shall have occurred and be
continuing a Default or an Event of Default with respect to any
Senior Notes represented by the Global Senior Notes; and the
Trustee shall, upon receipt of a Company Order in accordance with
Section 3.4, authenticate and make available for delivery,
definitive Senior Notes in an aggregate principal amount equal to
the principal amount of the Global Senior Notes in exchange for
such Global Senior Notes. If specified by the Company pursuant to
Section 3.4, the Depositary may surrender a Global Senior Note in
exchange in whole or in part for Senior Notes of like tenor and
terms and in definitive form on such terms as are acceptable to
the Company, the Trustee and the Depositary.
(c) In connection with the transfer of Global Senior Notes to
beneficial owners pursuant to the third sentence of paragraph (b)
of this Section, the Global Senior Notes shall be deemed to be
surrendered to the Trustee for cancellation, and the Company
shall execute and the Trustee upon receipt of a Company Order for
the authentication and delivery of definitive Senior Notes shall
authenticate and make available for delivery, without service
charge:
(i) to the Depositary or to each Person specified by such
Depositary a new Senior Note or Senior Notes of like tenor
and terms and of any authorized denomination as requested by
such Person in aggregate principal amount equal to and in
exchange for such Person's beneficial interest in the Global
Senior Note; and
(ii) to such Depositary a new Global Senior Note of like tenor
and terms and in an authorized denomination equal to the
difference, if any, between the principal amount of the
surrendered Global Senior Note and the aggregate principal
amount of Senior Notes delivered to Holders thereof.
Notwithstanding any other provision of this Indenture, any Senior Note
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, any Global Senior Note shall also be a Global Senior Note
and shall bear the legend specified in Section 2.4 except for any Senior Note
authenticated and delivered in exchange for, or upon registration of transfer
of, a Global Senior Note pursuant to the preceding sentence.
(d) The Holder of any Global Senior Note may grant proxies and
otherwise authorize any person, including Agent Members and
persons that may hold interests through Agent Members, to take
any action which a Holder is entitled to take under this
Indenture or the Senior Notes.
(e) Upon the exchange of a Global Senior Note in its entirety for
Senior Notes in definitive form, such Global Senior Note shall be
canceled by the Trustee.
40
(f) Notwithstanding anything herein to the contrary, if at any time
the Depositary for the Senior Notes notifies the Company that it
is unwilling or unable to continue as a Depositary for the Senior
Notes or if at any time the Depositary for the Senior Notes shall
no longer be registered or in good standing under the Exchange
Act, or other applicable statute or regulation, the Company shall
appoint a successor Depositary with respect to the Senior Notes.
If a successor Depositary for the Senior Notes is not appointed
by the Company within 90 days after the Company receives such
notice or becomes aware of such condition, the Company will
execute, and the Trustee, upon Company Request, will authenticate
and make available for delivery Senior Notes in definitive form
in an aggregate principal amount equal to the principal amount of
the Global Senior Note or Global Senior Notes representing Senior
Notes in exchange for such Global Senior Note or Global Senior
Notes.
ARTICLE FIVE
REMEDIES
SECTION 5.1 Events of Default.
An "Event of Default" as used herein is any one of the following:
(a) failure by the Company to pay interest (including any Additional
Interest) on any Senior Note when due and payable, if such
failure continues for a period of 30 days;
(b) failure by the Company to pay principal on any Senior Note when
due and payable at Stated Maturity or upon redemption,
acceleration or otherwise;
(c) failure by the Company to comply with any other agreement or
covenant contained in this Indenture (other than a default
specified in clause (a) or (b) above) if such failure continues
for a period of 30 days after notice to the Company by the
Trustee or to the Company and the Trustee by the Holders of at
least 25% in principal amount of the Senior Notes then
Outstanding;
(d) Indebtedness of the Company or any Subsidiary of the Company is
not paid within any applicable grace period after final maturity
or in the event that final maturity is accelerated because of a
default and, in either case, where the aggregate principal amount
of such Indebtedness so unpaid or accelerated is equal to or
greater than 5% of the Company's Consolidated Net Worth at the
quarter end preceding the end of such grace period or such
acceleration;
(e) existence of one or more judgments against the Company or any of
its Subsidiaries, which remain undischarged 60 days after all
rights to directly review such judgment, whether by appeal or
writ, have been exhausted or have expired, in excess, either
individually or in the aggregate, of 5% of the Company's
41
Consolidated Net Worth as of the quarter end preceding the end of
such 60-day period; or
(f) a receiver, liquidator, assignee, custodian, trustee,
conservator, sequestrator (or other similar official) shall take
possession of the Company or any Significant Subsidiary or any
substantial part of the property of the Company or any
Significant Subsidiary without the consent of the Company or such
Significant Subsidiary, respectively, or a court having
jurisdiction in the premises shall enter a decree or order for
relief in respect of the Company or such Significant Subsidiary
in an involuntary case under any applicable bankruptcy,
insolvency, receivership, conservatorship or other similar law
now or hereafter in effect, or appointing a receiver, liquidator,
assignee, trustee, custodian, conservator, sequestrator (or other
similar official) of the Company or the Significant Subsidiary or
for any substantial part of the property of the Company or the
Significant Subsidiary, or ordering the winding-up or liquidation
of the affairs of the Company or the Subsidiary, and such decree
or order shall continue unstayed and in effect for a period of 60
consecutive days, or the Company or the Significant Subsidiary
shall commence a voluntary case under any applicable bankruptcy,
insolvency, receivership, conservatorship or other similar law
now or hereafter in effect, or shall consent to the entry of an
order for relief in an involuntary case under any such law, or
shall consent to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian, conservator,
sequestrator (or other similar official) of the Company or the
Significant Subsidiary or of any substantial part of the property
of the Company or the Significant Subsidiary, or shall make any
general assignment for the benefit of creditors, or shall take
any corporate action in furtherance of any of the foregoing.
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
clause (f) of Section 5.1) occurs and is continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Senior Notes may declare the principal amount of all of the Senior
Notes to be due and payable immediately, by a notice in writing to the Company
(and to the Trustee if given by Holders), and upon any such declaration such
principal amount shall become immediately due and payable. If any Event of
Default specified in clause (f) of Section 5.1 occurs, the principal amount of
all of the Senior Notes shall automatically become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holder.
At any time after such a declaration of acceleration with respect to
Senior Notes has been made and before a judgment or decree for payment of the
money due has been obtained by the Trustee as hereinafter in this Article
provided, the Holders of a majority in principal amount of the Outstanding
Senior Notes, by written notice to the Company and the Trustee, may rescind and
annul such declaration and its consequences if:
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(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay:
(A) all overdue interest (including any Additional
Interest) on all Senior Notes,
(B) the principal of (and premium, if any, on) any Senior
Notes which have become due otherwise than by such
declaration of acceleration and any interest (including
any Additional Interest) thereon at the rate or rates
prescribed therefor in such Senior Notes,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates
prescribed therefor in such Senior Notes, and
(D) all sums paid or advanced by the Trustee hereunder and
the reasonable, expenses, disbursements and advances of
the Trustee's agents and counsel; and
(2) all Events of Default with respect to Senior Notes, other
than the non-payment of the principal of Senior Notes which
have become due solely by such declaration of acceleration,
have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent default or impair any
right consequent thereon.
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if:
(1) default is made in the payment of any interest
(including any Additional Interest) on any Senior
Note when such interest becomes due and payable and
such default continues for a period of 30 days, or
(2) default is made in the payment of the principal of
(or premium, if any, on) any Senior Note at the
Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Senior Notes, the whole amount then due and payable on such
Senior Notes for principal and any premium and interest (including any
Additional Interest) and, to the extent that payment of such interest shall be
legally enforceable, interest on any overdue principal and premium and on any
overdue interest (including any Additional Interest), at the rate or rates
prescribed therefor in such Senior Notes, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable expenses, disbursements and advances of the Trustee's
agents and counsel.
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If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may (or, at the
direction of Holders of not less than 25% of the Outstanding Senior Notes
shall), in addition to any other remedies available to it, institute a judicial
proceeding for the collection of the sums so due and unpaid and may prosecute
such proceeding to judgment or final decree, and may enforce the same against
the Company or any other obligor upon the Senior Notes and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company or any other obligor upon the Senior Notes, wherever
situated.
If an Event of Default with respect to Senior Notes occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Senior Notes by such appropriate
judicial proceedings as the Trustee shall deem most effectual to protect and
enforce any such rights, whether for the specific enforcement of any covenant or
agreement in this Indenture or in aid of the exercise of any power granted
herein, or to enforce any other proper remedy.
SECTION 5.4 Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any
other obligor upon the Senior Notes), its property or its creditors, the Trustee
shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay the reasonable expenses, disbursements
and advances of the Trustee's agents and counsel, and any other amounts due the
Trustee under Section 6.7.
No provision of this Indenture shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Holder any plan
of reorganization, arrangement, adjustment or composition affecting the Senior
Notes or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding; provided, however,
the Trustee may vote on behalf of the Holders for the election of a trustee in
bankruptcy or similar official and may be a member of a creditors' or other
similar committee.
SECTION 5.5 Trustee May Enforce Claims Without Possession of Senior
Notes.
All rights of action and claims under this Indenture or the Senior
Notes may be prosecuted and enforced by the Trustee without the possession of
any of the Senior Notes or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable expenses, disbursements and
advances of the Trustee's agents and counsel, be for the ratable benefit of the
Holders of the Senior Notes in respect of which such judgment has been
recovered.
SECTION 5.6 Application of Money Collected.
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Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or any premium
or interest (including any Additional Interest), upon presentation of the Senior
Notes and the notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 6.7; and
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest (including
any Additional Interest) on the Senior Notes in
respect of which or for the benefit of which such
money has been collected, ratably, without preference
or priority of any kind, according to the amounts due
and payable on such Senior Notes for principal and
any premium and interest (including any Additional
Interest), respectively.
SECTION 5.7 Limitation on Suits.
No Holder of any Senior Note shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to
the Trustee of a continuing Event of Default with
respect to the Senior Notes;
(2) the Holders of not less than 25% in principal amount
of the Outstanding Senior Notes shall have made
written request to the Trustee to institute
proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable security or indemnity against the costs,
expenses and liabilities to be incurred in compliance
with such request;
(4) the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to
institute any such proceeding; and
(5) no direction inconsistent with such written request
has been given to the Trustee during such 60-day
period by the Holders of a majority in principal
amount of the Outstanding Senior Notes;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
SECTION 5.8 Unconditional Right of Holders to Receive Principal,
Premium and Interest.
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Notwithstanding any other provision in this Indenture, the Holder of
any Senior Note shall have the right, which is absolute and unconditional, to
receive payment of the principal of and any premium and (subject to Section 3.8)
any interest (including any Additional Interest) on such Senior Note on the
Stated Maturity or maturities expressed in such Senior Note (or, in the case of
redemption, on the Redemption Date), and to institute suit for the enforcement
of any such payment, and such rights shall not be impaired without the consent
of such Holder.
SECTION 5.9 Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
SECTION 5.10 Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Senior Notes in the last paragraph of
Section 3.7, no right or remedy herein conferred upon or reserved to the Trustee
or to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 5.11 Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Senior
Notes to exercise any right or remedy accruing upon any Default shall impair any
such right or remedy or constitute a waiver of any such Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
SECTION 5.12 Control by Holders.
The Holders of a majority in principal amount of the Outstanding Senior
Notes shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee, with respect to the Senior Notes, provided
that
(1) such direction shall not be in conflict with any rule
of law or with this Indenture,
(2) the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such
direction, and
46
(3) subject to the provisions of Section 6.1, the Trustee
shall have the right to decline to follow any such
direction if the Trustee in good faith shall, by a
Responsible Officer or Officers of the Trustee,
determine that the proceeding so directed would involve
the Trustee in personal liability.
SECTION 5.13 Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Senior Notes may on behalf of the Holders of all the Senior Notes
waive any past default hereunder and its consequences, except a default:
(1) in the payment of the principal of or any premium or
interest (including any Additional Interest) on any
Senior Note, or
(2) in respect of a covenant or provision hereof which
under Article Nine cannot be modified or amended
without the consent of the Holder of each Outstanding
Senior Note affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
SECTION 5.14 Undertaking for Costs.
The parties to this Indenture agree, and each Holder of any Senior
Notes by his acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys'
fees and expenses, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in principal
amount of the Outstanding Senior Notes, or to any suit instituted by any Holder
for the enforcement of the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on any Senior Notes on or after the
Stated Maturity or maturities expressed in such Senior Notes (or, in the case of
redemption, on or after the Redemption Date).
SECTION 5.15 Waiver of Usury, Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any usury, stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
47
ARTICLE SIX
THE TRUSTEE
SECTION 6.1 Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Trustee shall be subject to the provisions of
this Section. If an Event of Default occurs (and is not cured), the Trustee, in
the exercise of its power, must use the degree of care of a prudent man in the
conduct of his own affairs. Subject to the requirement in the foregoing
sentence, the Trustee is under no obligation to exercise any of its rights or
powers under this Indenture at the request of any Holder, unless such Holder
shall have offered to the Trustee security and indemnity satisfactory to it
against any loss, liability or expense and then only to the extent required by
the terms of this Indenture. No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
of liability is not reasonably assured to it.
Except during the continuance of an Event of Default, (i) the Trustee
undertakes to perform such duties and only such duties as are specifically set
forth in this Indenture, and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and (ii) 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.
The Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer of the Trustee, unless it shall be proved that
the Trustee was negligent in ascertaining the pertinent facts. The Trustee shall
not be liable with respect to any action taken or omitted to be taken by it in
good faith in accordance with the direction of the Holders or a majority in
principal amount of the Outstanding Senior Notes relating to the time, method
and place of conducting any proceeding for any remedy available to the Trustee,
or exercising any trust power conferred upon the Trustee, under this Indenture.
SECTION 6.2 Notice of Defaults.
If a Default occurs and is continuing and is actually known to a
Responsible Officer of the Trustee, the Trustee shall mail to each Holder notice
of the Default as to and to the extent provided in the Trust Indenture Act.
Except in the case of a Default in the payment of principal of, premium, if any,
or interest (including any Additional Interest) on any Senior Note, the Trustee
may withhold notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Responsible Officers of the
Trustee determines that withholding notice is in the interest of the Holders.
SECTION 6.3 Certain Rights of Trustee.
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Subject to the provisions of Section 6.1:
(a) the Trustee may conclusively rely and shall be protected in
acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by
it to be genuine and to have been signed or presented by the
proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and
any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed)
may, in the absence of bad faith on its part, rely upon an
Officers' Certificate;
(d) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full
and complete authorization and protection in respect of any
action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or
direction of any of the Holders pursuant to this Indenture,
unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or
direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence
of indebtedness or other paper or document, but the Trustee, in
its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of
the Company, personally or by agent or attorney at the sole cost
of the Company and shall incur no liability or additional
liability of any kind by reason of such inquiry or investigation;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through
agents or attorneys and the Trustee shall not be responsible for
any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder;
(h) the permissive rights of the Trustee to do things enumerated in
this Indenture shall not be construed as a duty, and the Trustee
shall not be answerable for other than its negligent action,
negligent omission or its willful misconduct; and
49
(i) the Trustee shall not be charged with knowledge of any Event of
Default under Section 5 (other than an Event of Default under
Section 5.1(a) or (b) if the Trustee is also the Paying Agent
with respect to the Senior Notes) hereof unless either (1) a
Responsible Officer of the Trustee shall have actual knowledge
thereof or (2) the Trustee shall have received notice thereof in
accordance with Section 1.5 hereof from the Company or a Holder.
SECTION 6.4 Not Responsible for Recitals or Issuance of Senior Notes.
The recitals contained herein and in the Senior Notes, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee or any Authenticating Agent assumes no
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Senior Notes. The
Trustee or any Authenticating Agent shall not be accountable for the use or
application by the Company of Senior Notes or the proceeds thereof.
SECTION 6.5 May Hold Senior Notes.
The Trustee, any Authenticating Agent, any Paying Agent, any Senior
Note Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Senior Notes and, subject to
Sections 6.8 and 6.13, may otherwise deal with the Company with the same rights
it would have if it were not Trustee, Authenticating Agent, Paying Agent, Senior
Note Registrar or such other agent.
SECTION 6.6 Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed in writing with the Company.
SECTION 6.7 Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Trustee such compensation as from time
to time agreed in writing with the Trustee for all
services rendered by it hereunder (which compensation
shall not be limited by any provision of law in
regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with
any provision of this Indenture (including the
reasonable compensation and the expenses and
disbursements of its agents and counsel), except any
such expense, disbursement or advance as may be
attributable to its negligence or bad faith or
willful misconduct;
(3) to indemnify each of the Trustee or any predecessor
Trustee and their agents for, and to hold them
harmless against, any and all loss, liability,
50
damage, claim or expense, including taxes (other than
taxes based on the income of the Trustee) incurred
without negligence, willful misconduct or bad faith
on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts
hereunder, including the costs and expenses of
defending itself against any claim or liability in
connection with the exercise or performance of any of
its powers or duties hereunder;
(4) to secure the Company's obligations under this
Section, the Trustee shall have a lien prior to the
Senior Notes upon all money or property held or
collected by the Trustee in its capacity as Trustee,
except for such money and property which is held in
trust to pay principal (and premium, if any) or
interest (including any Additional Interest) on
particular Senior Notes;
(5) when the Trustee incurs any expenses or renders any
services after the occurrence of an Event of Default
specified in Section 5.1(f), such expenses and the
compensation for such services are intended to
constitute expenses of administration under the
Bankruptcy Code or any similar federal or state law
for the relief of debtors; and
(6) that the provisions of this Section 6.7 shall survive
the termination of this Indenture or the appointment
of a successor trustee.
SECTION 6.8 Disqualification; Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
SECTION 6.9 Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be a Person
that is eligible pursuant to the Trust Indenture Act to act as such and has a
combined capital and surplus of at least $50,000,000. If such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of its supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Person shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
SECTION 6.10 Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective
until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 6.11.
(b) The Trustee may resign at any time with respect to the Senior
Notes by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by
Section 6.11 shall not have been delivered to the
51
Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition, at the expense
of the Company, any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Senior
Notes.
(c) The Trustee may be removed at any time with respect to the Senior
Notes by Act of the Holders of a majority in principal amount of
the Outstanding Senior Notes, delivered to the Trustee and to the
Company. If the instrument of acceptance by a successor Trustee
required by Section 6.11 shall not have been delivered to the
Trustee within 30 days after the giving of such notice of
removal, the Trustee being removed may petition, at the expense
of the Company, any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Senior
Notes.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 6.8 after
written request therefor by the Company or by any Holder who
has been a bona fide Holder of a Senior Note for at least
six months, or
(2) the Trustee shall cease to be eligible under Section 6.9 and
shall fail to resign after written request therefor by the
Company or by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the
Trustee or of its property shall be appointed or any public
officer shall take charge or control of the Trustee or of
its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then, in any such case, (i) the
Company by a Board Resolution may remove the Trustee with
respect to the Senior Notes, or (ii) subject to Section
5.14, any Holder who has been a bona fide Holder of a Senior
Note for at least six months may, on behalf of himself and
all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee with
respect to all Senior Notes and the appointment of a
successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for
any cause, the Company, by a Board Resolution, shall promptly
appoint a successor Trustee and shall comply with the applicable
requirements of Section 6.11. If, within one year after such
resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding
Senior Notes delivered to the Company and the retiring Trustee,
the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment in accordance with the applicable
requirements of Section 6.11, become the successor Trustee and to
that extent supersede the successor Trustee appointed by the
Company. If no successor Trustee shall have been so appointed by
the Company or the Holders and accepted appointment in the manner
required by Section 6.11, any Holder who has been a bona fide
Holder
52
of a Senior Note for at least six months may, on behalf of
himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor
Xxxxxxx.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor
Trustee to all Holders of Senior Notes in the manner provided in
Section 1.6. Each notice shall include the name of the successor
Trustee and the address of its Corporate Trust Office.
SECTION 6.11 Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee,
every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring
Trustee an instrument in writing accepting such appointment, and
thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but,
on the request of the Company or the successor Trustee, such
retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument in writing transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee
and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee
hereunder.
(b) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Trustee all such
rights, powers and trusts referred to in paragraph (a) of this
Section.
(c) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be eligible
under this Article.
SECTION 6.12 Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise eligible under this Article, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto. In case any Senior Notes shall have been authenticated, but not
delivered, by the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such authentication and
deliver the Senior Notes so authenticated with the same effect as if such
successor Trustee had itself authenticated such Senior Notes.
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SECTION 6.13 Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Senior Notes), the Trustee shall be subject to
the provisions of the Trust Indenture Act regarding the collection of claims
against the Company (or any such other obligor).
SECTION 6.14 Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents (which may be
an affiliate of the Company) with respect to the Senior Notes which shall be
authorized to act on behalf of the Trustee to authenticate Senior Notes issued
upon exchange, registration of transfer or partial redemption thereof (but not
upon original issuance or pursuant to Section 3.7), and Senior Notes so
authenticated shall be entitled to the benefits of this Indenture and shall be
valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Wherever reference is made in this Indenture to the authentication
and delivery of Senior Notes by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and shall at all
times be a corporation organized and doing business under the laws of the United
States of America, any state thereof or the District of Columbia, authorized
under such laws to act as Authenticating Agent, having a combined capital and
surplus of not less than $50,000,000 and subject to supervision or examination
by federal or state authority. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Authenticating Agent shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section, such Authenticating
Agent shall resign immediately in the manner and with the effect specified in
this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders of Senior
Notes with respect to which such Authenticating Agent will serve, as their names
and addresses appear in the Senior Note Register. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named
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as an Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provisions of this Section.
The Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section.
If an appointment is made pursuant to this Section, the Senior Notes
may have endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternative certificate of authentication in the following
form:
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This is one of the Senior Notes designated and referred to in the
within mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
By:_________________________________
As Authenticating Agent
By:_________________________________
Authorized Signatory
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ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 7.1 Company to Furnish Trustee Names and Addresses of Holders;
Trustee to Furnish Senior Note Register.
(a) The Company will furnish or cause to be furnished to the Trustee:
(i) semi-annually, not later than five Business Days after each
Regular Record Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the
Holders of Senior Notes as of such Regular Record Date, and
(ii) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished;
excluding from any such list names and addresses received by the
Trustee in its capacity as Senior Note Registrar.
(b) The Trustee shall furnish to the Company a copy of the list
maintained as the Senior Note Register from time to time as
requested by the Company in writing.
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SECTION 7.2 Preservation of Information; Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders
contained in the most recent list furnished to the Trustee
as provided in Section 7.1 and the names and addresses of
Holders received by the Trustee in its capacity as Senior
Note Registrar. The Trustee may destroy any list furnished
to it as provided in Section 7.1 upon receipt of a new list
so furnished.
(b) The rights of the Holders to communicate with other Holders
with respect to their rights under this Indenture or under
the Senior Notes, and the corresponding rights and
privileges of the Trustee, shall be as provided by the Trust
Indenture Act.
(c) Every Holder of Senior Notes, by receiving and holding the
same, agrees with the Company and the Trustee that neither
the Company nor the Trustee nor any agent of either of them
shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made
pursuant to the Trust Indenture Act.
SECTION 7.3 Reports by Trustee.
(a) The Trustee shall transmit to Holders such reports
concerning the Trustee and its actions under this Indenture
as may be required pursuant to the Trust Indenture Act at
the times and in the manner provided pursuant thereto. If
required by Section 313(a) of the Trust Indenture Act, the
Trustee shall, within sixty (60) days after each May 15
following the date of this Indenture deliver to Holders a
brief report, dated as of such May 15, which complies with
the provisions of such Section 313(a). To the extent that
any such report is required by the Trust Indenture Act with
respect to any 12-month period, such report shall cover the
12-month period ending March 15 and shall be transmitted by
the next succeeding May 15.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each
securities exchange upon which any Senior Notes are listed,
with the SEC and with the Company. The Company will promptly
notify the Trustee when any Senior Notes are listed on any
securities exchange.
SECTION 7.4 Reports by Company.
The Company shall file with the SEC and shall furnish to the Trustee
and the Holders, within 15 days after it files them with the SEC, copies of its
annual report and the information, documents and other reports which the Company
is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange
Act. Notwithstanding that the Company may not be required to remain subject to
the reporting requirements of Section 13 or 15(d) of the Exchange Act, the
Company shall continue to file with the SEC and to provide to the Trustee and
the Holders the annual reports and the information, documents and other reports
which are specified in Section 13 or 15(d) of the Exchange Act and applicable to
a US corporation subject to such sections, such information, documents and other
reports to be filed and provided at the times specified for the filing of such
information, documents and reports under such section. The
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Company also shall comply with the other provisions of Section 314(a) of the
Trust Indenture Act.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
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ARTICLE EIGHT
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 8.1 Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the Company, and
the assumption by any such successor of the covenants of the
Company herein and in the Senior Notes;
(b) to provide for uncertificated Senior Notes in addition to or in
place of certificated Senior Notes (provided, that such
uncertificated Senior Notes are issued in registered form for
purposes of Section 163(f) of the Code, or in a manner such that
the uncertificated Senior Notes are described in Section
163(f)(2)(B) of the Code);
(c) to add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power conferred upon the
Company hereunder and under the Senior Notes;
(d) to cure any ambiguity, to correct or supplement any provision
herein that may be defective or inconsistent with any other
provision herein or in the Senior Notes, or to make any other
provisions with respect to matters or questions arising under
this Indenture or under the Senior Notes that shall not be
inconsistent with the provisions of this Indenture; provided
that, in each case, such provisions shall not adversely affect
the interests of the Holders;
(e) to evidence, and provide for the acceptance of, the appointment
of a successor Trustee hereunder;
(f) to add any additional Events of Default;
(g) to secure the Senior Notes or add a Guarantor; or
(h) to comply with any requirement of the SEC or state securities
regulators in connection with the qualification of this Indenture
under the Trust Indenture Act or any registration or
qualification of the Senior Notes under the Securities Act or
state securities laws.
SECTION 8.2 Supplemental Indentures with Consent of Holders.
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(a) Except as otherwise provided in Section 8.2(b), with the written
consent of the Holders of a majority in principal amount of the
Outstanding Senior Notes, by Act of such Holders delivered to the
Company and the Trustee, the Company, when authorized by a Board
Resolution, and the Trustee may enter into an indenture or
indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating or waiving
any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders under this Indenture; provided,
however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Senior Note affected
thereby,
(A) change the Stated Maturity of the principal of, or any
installment of interest on, any Senior Note, or reduce the
principal amount thereof, premium, if any, or the rate of
interest (including any Additional Interest) thereon, or
change the coin or currency in which the principal of any
Senior Note or any premium or the interest (including any
Additional Interest) thereon is payable, or impair the right
to institute suit for the enforcement of any such payment
after the Stated Maturity;
(B) reduce the percentage in principal amount of the Outstanding
Senior Notes the consent of whose Holders is required for
any such amendment or modification, or the consent of whose
Holders is required for any waiver (of compliance with the
provisions of this Indenture or Defaults hereunder and their
consequences) provided for in this Indenture;
(C) modify any provision of Section 11.2 or the definitions used
therein if the effect of such modification or waiver is to
decrease the amount of any payment required to be made by
the Company thereunder or extend the maturity date of such
payment;
(D) modify any of the provisions of this Section 8.2 or Section
5.13 relating to supplemental indentures requiring the
consent of Holders or relating to the waiver of past
defaults or relating to the waiver of certain covenants,
except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each
Senior Note affected thereby;
(E) except as otherwise permitted under the provisions of
Article Ten, consent to the assignment or transfer by the
Company of any of its rights and obligations under this
Indenture; or
(F) waive a default in payment with respect to the Senior Notes
(other than a default in payment that is due solely because
of the acceleration of the Maturity of the Senior Notes).
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(b) It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such
Act and such notice shall approve the substance thereof.
SECTION 8.3 Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article Eight or the modifications
thereby of the trusts created by this Indenture, the Trustee shall receive, and
(subject to Section 6.1) shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee may, but shall not be obligated to,
enter into any such supplemental indenture which affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
SECTION 8.4 Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Senior Notes theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby and entitled to the benefits thereof.
SECTION 8.5 Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article Eight
shall conform to the requirements of the Trust Indenture Act as then in effect.
SECTION 8.6 Reference in Senior Notes to Supplemental Indentures.
Senior Notes authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article Eight may, and shall if required
by the Trustee, bear a notation in form acceptable to the Trustee as to any
matter provided for in such supplemental indenture. If the Company shall so
determine, new Senior Notes so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any such supplemental indenture may be
prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Senior Notes.
SECTION 8.7 Notice of Supplemental Indenture.
After an supplemental indenture hereunder becomes effective, the
Company shall mail to Holders a notice briefly describing such supplemental
indenture; provided, that the failure to give such notice to all Holders, or any
defect therein, will not impair or affect the validity of the supplemental
indenture.
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ARTICLE NINE
COVENANTS
SECTION 9.1 Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of the Holders that it
will duly and punctually pay the principal of (and premium, if any, on) and
interest (including any Additional Interest) on the Senior Notes in accordance
with the terms of the Senior Notes and this Indenture.
The Senior Notes shall be included in the Same-Day Funds Settlement
System or equivalent system of the Depositary until maturity to the extent such
systems are available. Each Global Senior Note will be paid in accordance with
the provisions of Section 4.2 hereof.
SECTION 9.2 Maintenance of Office or Agency.
The Company will maintain an office or agency in a Place of Payment
where Senior Notes may be presented or surrendered for payment and where Senior
Notes may be surrendered for registration of transfer or exchange. Initially,
the Company hereby designates the Corporate Trust Office for all such purposes.
The Company will give prompt written notice to the Trustee of the location, and
any change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations and surrenders,
notices and demands may be made or served at the Corporate Trust Office, and the
Company hereby appoints the Trustee as its agent to receive all such
presentations and surrenders.
The Company may also from time to time designate one or more other
offices or agencies where the Senior Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in each
Place of Payment for Senior Notes for such purposes. The Company will give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
SECTION 9.3 Money for Senior Notes Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with
respect to the Senior Notes, it will, on or before each due date of the
principal of or any premium or interest (including any Additional Interest) on
any of the Senior Notes, segregate and hold in trust for the benefit of the
Persons entitled thereto a sum sufficient to pay the principal and any premium
and interest (including any Additional Interest) so becoming due until such sums
shall be paid to such Persons or otherwise disposed of as herein provided and
will promptly notify the Trustee of its action or failure to act.
Whenever the Company shall have one or more Paying Agents for the
Senior Notes, it will, prior to each due date of the principal of or any premium
or interest (including any Additional Interest) on any Senior Notes, deposit
with a Paying Agent, in immediately available funds, a sum sufficient to pay
such amount, such sum to be held as provided by the Trust
63
Indenture Act, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure 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 principal
of (and premium, if any) or interest (including any
Additional Interest) on Senior Notes 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 Senior Notes) in the
making of any such payment of principal (and premium,
if any) or interest (including any Additional
Interest); and
(3) at any time during the continuance of any such
default, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held in
trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of or any premium or
interest (including any Additional Interest) on any Senior Note and remaining
unclaimed for two years after such principal, premium or interest (including any
Additional Interest) has become due and payable shall be paid to the Company on
Company Request, or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Senior Note shall thereafter, as an unsecured
general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Company cause to be
published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
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SECTION 9.4 Statement by Officers as to Default.
(a) The Company will deliver to the Trustee, within 120 days after
the end of each fiscal year of the Company ending after the date
hereof, an Officers' Certificate (one of the signers of which
shall be the principal executive officer, principal financial
officer or principal accounting officer of the Company), stating
whether or not to the best knowledge of the signers thereof the
Company is, or was during the preceding year, in default in the
performance and observance of any of the terms, provisions and
conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the
Company shall be or shall have been in default, specifying all
such defaults and the nature and status thereof of which they may
have knowledge.
(b) When any Default has occurred and is continuing under this
Indenture, or if the trustee for or the holder of any other
evidence of Indebtedness of the Company or any Subsidiary gives
notice or takes any other action with respect to a claimed
default (other than with respect to Indebtedness in the principal
amount of less than 5% of the Company's Consolidated Net Worth at
the quarter end preceding the giving of such notice or taking of
such action with respect to a claimed default), the Company shall
deliver to the Trustee by registered or certified mail, or by
facsimile transmission, confirmed by delivery of the original, an
Officers' Certificate specifying such event, notice or other
action within five Business Days of its occurrence.
SECTION 9.5 Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, and (2)
all lawful claims for labor, materials and supplies which, if unpaid, might by
law become a lien upon the property of the Company or any Subsidiary; provided,
however, that the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings and for which adequate reserves (in the good faith judgment of the
Board of Directors) have been made.
SECTION 9.6 Maintenance of Properties.
The Company will cause all properties owned by the Company or any
Restricted Subsidiary or used or held for use in the conduct of its business or
the business of any Restricted Subsidiary to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent the Company or any Subsidiary from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of its Board of Directors, desirable in the
conduct of its business or the business of the Company or such Subsidiary and
not disadvantageous in any material respect to the Holders.
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SECTION 9.7 Corporate Existence; Keeping of Books.
Subject to Article Ten, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect the existence,
rights (charter and statutory) and franchises of the Company and its
Subsidiaries; provided, however, that the existence of any Subsidiary and any
such right or franchise of the Company or any Subsidiary may be terminated if
the Board of Directors shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company and its
Subsidiaries and that the loss thereof is not and is not reasonably likely to be
disadvantageous in any material respect to the Holders.
The Company shall keep, and cause each Subsidiary to keep, proper books
and records, in which full and correct entries shall be made of all financial
transactions and the assets, liabilities and business of the Company and its
Subsidiaries, in each case in accordance with GAAP.
SECTION 9.8 Insurance.
The Company will at all times maintain and will cause each of its
Subsidiaries to maintain (either in the name of the Company or in such
Subsidiary's own name) with financially sound and reputable insurers, insurance
on all its properties in such amounts as management of the Company reasonably
determines is appropriate under the circumstances.
SECTION 9.9 Net Worth Maintenance.
On the Issue Date, and at all times thereafter determined at the end of
each fiscal quarter, the Company shall maintain Consolidated Net Worth equal to
(i) $50.0 million plus (ii) a cumulative amount equal to twenty-five percent
(25%) of the Consolidated Net Income (but not loss), if any, of the Company and
its Subsidiaries for each fiscal quarter commencing with the quarter after the
Issue Date.
SECTION 9.10 Limitations on Indebtedness.
(a) Except for the issuance of the Senior Notes, the Company shall
not incur, directly or indirectly, any Indebtedness or issue any
Disqualified Capital Stock; provided, however, that the Company
may incur Indebtedness or issue Disqualified Capital Stock if, on
the date of such incurrence or issuance and after giving effect
thereto, (i) no Default or Event of Default has occurred and is
continuing or would result therefrom and (ii) the Leverage Ratio
does not exceed 2.0 to 1.0.
(b) The Company will not create, incur, issue, assume, guarantee or
otherwise in any manner become directly or indirectly liable for
or with respect to, or otherwise permit to exist, any Junior
Indebtedness or Pari Passu Indebtedness (other than Acquired
Indebtedness) unless the Stated Maturity of principal (or any
required repurchase, redemption, defeasance or sinking fund
payments) of such Junior Indebtedness or Pari Passu Indebtedness
is after the final Stated Maturity of principal of the Senior
Notes.
(c) The Company will not permit any Subsidiary to, directly or
indirectly, incur any Indebtedness or issue any Disqualified
Capital Stock.
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(d) The Company shall not incur any Indebtedness which would be
senior in right of payment to the Senior Notes.
(e) The foregoing provisions shall not apply to:
(1) Permitted Acquisition Indebtedness of the Company and its
Subsidiaries;
(2) Permitted Repurchase Facilities of the Company and its
Subsidiaries;
(3) Guarantees by the Company of (1) and (2);
(4) Intercompany Indebtedness owed by the Company to any of its
Subsidiaries or owed by any Subsidiary to the Company;
(5) Incurrence by the Company of its obligations under the
Senior Notes;
(6) Non-Recourse Indebtedness of the Company and its
Subsidiaries;
(7) Securities issued in a securitization by a Securitization
Entity formed by or on behalf of the Company or its
Subsidiaries, regardless of whether such securities are
treated as indebtedness for tax purposes, provided that
neither the Company nor any Subsidiary (other than the
Securitization Entity formed solely for the purpose of such
securitization) is directly or indirectly liable as a
guarantor or otherwise (excluding the provision of Credit
Support) for such securities or obligations of the
Securitization Entity;
(8) Unsecured working capital loans to Subsidiaries, not to
exceed $5.0 million in the aggregate, provided, however,
that such Indebtedness shall be considered to be
Indebtedness of the Company for the purpose of the Leverage
Ratio;
(9) Acquired Indebtedness of Subsidiaries, provided, however,
that such Acquired Indebtedness shall be considered to be
Indebtedness of the Company for the purpose of the Leverage
Ratio;
(10) Indebtedness secured by Xxxxxxxxx Xxxxx; or
(11) Hedging Obligations directly related to: (i) Indebtedness
permitted to be incurred by the Company or its Subsidiaries
pursuant to this Indenture; (ii) loans held by the Company
or its Subsidiaries pending sale; or (iii) loans with
respect to which the Company or any Subsidiary has an
outstanding purchase offer or commitment, financing
commitment or security interest.
(f) For purposes of determining compliance with the foregoing
covenant: (i) in the event that an item of Indebtedness
meets the criteria of more than one of the types of
Indebtedness described above, the Company, in good faith,
will classify such item of Indebtedness and be required to
include the amount and type of such Indebtedness in one of
the above clauses; and (ii) an item of Indebtedness may be
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divided and classified in more than one of the types of
Indebtedness described above.
SECTION 9.11 Limitation on Issuances and Sales of Capital Stock
Subsidiaries.
Except pursuant to existing agreements, options or option plans, the
Company (a) will not permit any Subsidiary to issue or sell any shares of its
Capital Stock(other than to the Company or a Wholly Owned Subsidiary) and (b)
will not permit any Person to own any shares of Capital Stock of any Subsidiary.
SECTION 9.12 Liquidity Maintenance.
The Company shall, at all times when the Senior Notes are not rated in
an investment grade category by one or more nationally recognized statistical
rating organizations, maintain Liquid Assets with a value equal to at least 100%
of the required interest (including Additional Interest) payments due on the
Senior Notes on the next succeeding semi-annual Interest Payment Date. Liquid
Assets of a Subsidiary may be included in such calculation only to the extent
that such Liquid Assets may at such time be distributed to the Company without
restriction or notice to any Person. Such Liquid Assets shall not be the subject
of any pledge, Lien, encumbrance or charge of any kind and shall not be used as
collateral or security for Indebtedness for borrowed money or otherwise of the
Company or its Subsidiaries nor may such Liquid Assets be used as reserves for
any self-insurance maintained by the Company.
SECTION 9.13 Limitations on Restricted Payments.
The Company will not, and will not permit any Subsidiary to, directly
or indirectly, make any Restricted Payment if, at the time of such Restricted
Payment or after giving effect thereto,
(a) a Default or Event of Default shall have occurred and be
continuing; or
(b) the Company would fail to maintain sufficient Liquid Assets to
comply with the terms of the covenant set forth in Section 9.12
hereof; or
(c) the aggregate amount of all Restricted Payments (the amount of
such payments, if other than in cash, having been determined in
good faith by the relevant Board of Directors, whose
determination shall be conclusive and evidenced by a Board
Resolution filed with the Trustee) declared and made after the
Issue Date would exceed the sum of;
(i) 25% of the aggregate Consolidated Net Income (or, if such
Consolidated Net Income is a deficit, 100% of such deficit)
of the Company accrued on a cumulative basis during the
period beginning on the first day of the fiscal quarter
during which the Issue Date occurred and ending on the last
day of the Company's last fiscal quarter ending prior to the
date of such proposed Restricted Payment; plus
(ii) the aggregate Net Cash Proceeds received by the Company as
capital contributions (other than from a Subsidiary) after
the Issue Date; plus
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(iii) the aggregate Net Cash Proceeds and the Fair Market Value
of property not constituting Net Cash Proceeds received by
the Company from the issuance or sale (other than to a
Subsidiary) of Qualified Capital Stock after the issue date
of the Senior Notes; plus
(iv) 100% of the amount of any Indebtedness of the Company or a
Subsidiary that is issued after the issue date of the Senior
Notes that is thereafter converted into or exchanged for
Qualified Capital Stock of the Company; or
(d) the Unsecured Debt Coverage Ratio for the Company for the most
recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date
of such Restricted Payment is less than 2.00 to 1.00, determined
after giving effect to such Restricted Payment; provided,
however, that the foregoing provisions will not prevent (y) the
payment of a dividend within 60 days after the date of its
declaration if at the date of declaration such payment was
permitted by the foregoing provisions or (z) any Permitted
Payment.
SECTION 9.14 Limitations on Dividends and Other Payment Restrictions
Affecting Subsidiaries.
The Company will not, and will not permit any of its Subsidiaries
(other than a Securitization Entity) to, create, assume or otherwise cause or
suffer to exist or to become effective any consensual encumbrance or restriction
on the ability of any such Subsidiary to
(a) pay any dividends or make any other distribution on its Capital
Stock;
(b) make payments in respect of any Indebtedness owed to the Company
or any other Subsidiary; or
(c) make loans or advances to the Company or any Subsidiary or to
guarantee Indebtedness of the Company or any other Subsidiary;
other than, in the case of (a), (b) and (c),
(1) restrictions imposed by Applicable Law;
(2) restrictions existing under agreements in effect on the date
of this Indenture;
(3) consensual encumbrances or restrictions binding upon any
Person at the time such Person becomes a Subsidiary of the
Company so long as such encumbrances or restrictions are not
created, incurred or assumed in contemplation of such Person
becoming a Subsidiary;
(4) restrictions with respect to a Subsidiary imposed pursuant
to an agreement entered into for the sale or disposition of
all or substantially all the assets (which term may include
the Capital Stock) of such Subsidiary;
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(5) restrictions on the transfer of assets which are subject to
Liens;
(6) restrictions existing under agreements evidencing Permitted
Acquisition Indebtedness or Permitted Repurchase Facilities
of any Subsidiary if such Indebtedness (i) is made without
recourse to, and with no cross-collateralization (which
shall not include Guarantees), against the assets of, the
Company or any other Subsidiary, and (ii) upon complete or
partial liquidation of which the Indebtedness must be
correspondingly repaid in whole or in part, as the case may
be; and
(7) restrictions existing under any agreement that renews,
extends, increases, refinances or replaces any of the
agreements containing the restrictions in clauses (2), (3)
and (6); provided that the terms and conditions of any such
restrictions (except for changes in interest rates related
to changes in market rates) are not less favorable to the
Holders than those under the agreement evidencing or
relating to the Indebtedness renewed, extended, increased,
refinanced or replaced.
SECTION 9.15 Limitations on Transactions with Affiliates.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, enter into any transaction or series of related
transactions (including without limitation, the sale, purchase, exchange or
lease of assets, property or services) with any Affiliate of the Company (except
that the Company and any of its Subsidiaries may enter into any transaction or
series of related transactions with any Subsidiary of the Company without
limitation under this covenant) unless: (i) such transactions or series of
related transactions is on terms that are no less favorable to the Company or
such Subsidiary, as the case may be, than would be available in a comparable
transaction in an arm's length dealing with a Person that is not such an
Affiliate or, in the absence of such a comparable transaction, on terms that the
relevant Board of Directors determines in good faith would be offered to a
Person that is not an Affiliate; (ii) with respect to any transaction or series
of related transactions involving aggregate payments in excess of $250,000, the
Company delivers an Officers' Certificate to the Trustee certifying that such
transaction or series of transactions complies with clause (i) above and has
been approved by a majority of the Disinterested Directors of the relevant Board
of Directors of the Company or such Subsidiary, as the case may be; and (iii)
with respect to any transaction or series of related transaction involving
aggregate payments in excess of $1,000,000, or in the event that no members of
the Board of Directors are Disinterested Directors with respect to any
transaction or series of transactions included in clause (ii), (x) in the case
of a transaction involving real property, the aggregate rental or sale price of
such real property shall be the fair market sale or rental value of such real
property as determined in a written opinion by a nationally recognized expert
with experience in appraising the terms and conditions of the type of
transaction or series of transactions for which approval is required and (y) in
all other cases, the Company delivers to the Trustee a written opinion of a
nationally recognized expert with experience in appraising the terms and
conditions of the type of transaction or series of transactions for which
approval is required to the effect that the transaction or series of
transactions are fair to the Company or such Subsidiary from a financial point
of view. The limitations set forth in this paragraph will not apply to (i)
transactions entered into pursuant to any agreement already in effect on the
Issue Date and any renewals or extensions thereof not involving modifications
materially adverse to the Company or any Subsidiary, (ii) normal banking
relationships with an Affiliate on an arms'
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length basis, (iii) any employment agreement, stock option, employee benefit,
indemnification, compensation, business expense reimbursement or other
employment-related agreement, arrangement or plan entered into by the Company or
any of its Subsidiaries which agreement, arrangement or plan was adopted by the
Board of Directors of the Company or such Subsidiary (including a majority of
the Disinterested Directors), as the case may be, (iv) any Restricted Payment or
Permitted Payment, (v) any transaction or series of transactions in which the
total amount involved does not exceed $125,000, or (vi) services rendered and
obligations incurred by the Company or any of its Subsidiaries pursuant to
existing agreements or agreements between the Company and/or any of its
Subsidiaries.
SECTION 9.16 Limitations on Liens and Guarantees.
The Company will not create, assume, incur or suffer to exist any Lien
(other than a Permitted Lien) upon any of the Company's assets (including the
Capital Stock of any Subsidiary) as security for Indebtedness, without
effectively providing that the Senior Notes will be equally and ratably secured
with (or prior to) such Indebtedness.
In addition, the Company will not permit any Subsidiary of the Company,
directly or indirectly, to guarantee or assume, or subject any of its assets to
a Lien (other than a Permitted Lien) to secure, any Pari Passu Indebtedness or
Junior Indebtedness unless (i) such Subsidiary simultaneously executes and
delivers a supplemental indenture to this Indenture providing for a guarantee
of, or pledge of assets to secure, the Senior Notes by such Subsidiary on terms
at least as favorable to the Holders of the Senior Notes as such guarantee or
security interest in such assets is to the holders of such Pari Passu
Indebtedness or Junior Indebtedness, except that in the event of a guarantee or
security interest in such assets with respect to (x) Pari Passu Indebtedness,
the guarantee or security interest in such assets under the supplemental
indenture shall be made pari passu to the guarantee or security interest in such
assets with respect to such Pari Passu Indebtedness or (y) Junior Indebtedness,
any such guarantee or security interest in such assets with respect to such
Junior Indebtedness shall be subordinated to such Subsidiary's guarantee or
security interest in such assets with respect to the Senior Notes to the same
extent as such Junior Indebtedness is subordinated to the Senior Notes and (ii)
such Subsidiary waives and will not in any manner whatsoever claim, or take the
benefit or advantage of, any rights of reimbursement, indemnity or subrogation
or any other rights against the Company or any other Subsidiary of the Company
as a result of any payment by such Subsidiary under its guarantees.
SECTION 9.17 Offer to Purchase upon a Change of Control Event.
(a) Upon the occurrence of a Change of Control Event, the Company
will offer to repurchase (the "Change of Control Purchase Offer")
all Senior Notes from the Holders, and each Holder will have the
right to require that the Company repurchase such Holder's Senior
Notes, at a purchase price in cash equal to 101% of the principal
amount thereof (the "Change of Control Purchase Price") plus
accrued and unpaid interest (including any Additional Interest),
if any, to the Change of Control Purchase Date (subject to the
right of Holders on the relevant Regular Record Date to receive
interest (including any Additional Interest) due on an Interest
Payment Date occurring prior to such Change of Control Purchase
Date), in accordance with the provisions of this Section 9.17.
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(b) Within 30 days following any Change of Control Event, the Company
shall mail a notice to each Holder with a copy to the Trustee (a
"Change of Control Purchase Notice") stating:
(i) that a Change of Control Event has occurred and that such
Holder has the right to require the Company to purchase such
Holder's Senior Notes at a Change of Control Purchase Price
in cash equal to 101% of the principal amount thereof plus
accrued and unpaid interest (including any Additional
Interest), if any, to the Change of Control Purchase Date
(subject to the right of Holders on the relevant Regular
Record Date to receive interest (including any Additional
Interest) on an Interest Payment Date occurring prior to the
Change of Control Purchase Date);
(ii) the circumstances and relevant facts regarding such Change
of Control Event (including, in the case of any merger,
consolidation or sale of all or substantially all assets,
information with respect to pro forma results of operations,
cash flow and capitalization after giving effect to such
Change of Control Event);
(iii) the Change of Control Purchase Date (which shall be no
earlier than 30 days nor later than 60 days from the date
such Change of Control Purchase Notice is mailed);
(iv) that, unless the Company defaults in making such payment,
any Senior Note accepted for payment pursuant to the Change
of Control Purchase Offer shall cease to accrue interest
(including any Additional Interest) after the Change of
Control Purchase Date;
(v) that Holders electing to have a Senior Note purchased
pursuant to any Change of Control Purchase Offer shall be
required to surrender the Senior Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse
of the Senior Note completed, or transfer by book-entry
transfer, to the Company, a depositary, if appointed by the
Company, or a Paying Agent at the address specified in the
notice, at least three Business Days before the Change of
Control Purchase Date; and
(vi) that Holders shall be entitled to withdraw their election if
the Company, the Depositary or the Paying Agent, as the case
may be, receives, not later than the last Business Day prior
to the Change of Control Purchase Date, a facsimile
transmission or letter setting forth the name of the Holder,
the principal amount of the Senior Note (and identification
number) the Holder delivered for purchase and a statement
that such Xxxxxx is withdrawing his election to have such
Senior Note purchased.
(c) Holders electing to have a Senior Note purchased will be required
to surrender the Senior Note, with the form entitled "Option of
Holder to Elect Purchase" duly completed, to the Company at the
address specified in the notice at least three Business Days
prior to the Change of Control Purchase Date. Holders will be
entitled to withdraw their election if the Trustee or the Company
receives not later
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than one Business Day prior to the Change of Control Purchase
Date, a facsimile transmission or letter setting forth the name
of the Holder, the principal amount of the Senior Note (and
identification number) which was delivered by the Holder for
purchase by the Company and a statement that such Xxxxxx is
withdrawing his election to have such Senior Note purchased.
(d) On the Change of Control Purchase Date, all Senior Notes
purchased by the Company in a Change of Control Purchase Offer
shall be delivered to the Trustee for cancellation, and the
Company shall pay the Change of Control Purchase Price plus
accrued and unpaid interest (including any Additional Interest),
if any, to the Holders entitled thereto.
(e) On or before the Change of Control Purchase Date, the Company
will deliver to the Trustee an Officers' Certificate stating that
the Senior Notes purchased in the Change of Control Purchase
Offer are accepted for payment by the Company in accordance with
the terms of this Section. The Company, the Depositary or the
Paying Agent, as the case may be, will promptly (but in any case
not later than five days after the Change of Control Purchase
Date) pay to each tendering Holder an amount equal to the Change
of Control Purchase Price of the Senior Notes tendered by such
Holder plus interest (including any Additional Interest) accrued
thereon (subject to the right of Holders on the relevant Regular
Record Date to receive interest (including any Additional
Interest) due on the relevant Interest Payment Date). The Company
will publicly announce the results of the Change of Control
Purchase Offer on the Change of Control Purchase Date.
(f) The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other
applicable securities laws or regulations in connection with the
repurchase of Senior Notes pursuant to this Section 9.17. To the
extent that the provisions of any securities laws or regulations
conflict with the provisions of this Section 9.17, the Company
will comply with the applicable securities laws and regulations
and will not be deemed to have breached its obligations under
this Section 9.17 by virtue thereof.
SECTION 9.18 Payments for Consent.
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, pay or cause to be paid any consideration, whether by
way of interest, fee or otherwise, to any Holder as an inducement to any
consent, waiver or amendment of any of the terms or provisions of this Indenture
or the Senior Notes unless such consideration is paid to all Holders that
provide such consent or so waive or agree to amend.
SECTION 9.19 Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 9.5 to 9.16, inclusive, with
respect to the Senior Notes if before the time of compliance the Holders of a
majority in principal amount of the Outstanding Senior Notes shall, by act of
such Holders, either waive such compliance in such instance or generally waive
compliance with such term, provision or condition, but no such waiver shall
extend to or affect such term, provision or condition except to the extent so
expressly waived, and, until such
73
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall remain in
full force and effect.
ARTICLE TEN
MERGER, CONSOLIDATION AND TRANSFER OF ASSETS
SECTION 10.1 Merger, Consolidation or Transfer of Assets of the
Company.
The Company shall not consolidate with or merge with or into, or sell,
assign, convey, transfer, lease or otherwise dispose of, in one transaction or a
series of transactions, all or substantially all its assets to, any Person,
unless: (i) the resulting, surviving or transferee Person (the "Successor
Company") shall be a Person organized and existing under the laws of the United
States of America or any state thereof or the District of Columbia and the
Successor Company (if not the Company) shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form reasonably
satisfactory to the Trustee, all of the Company's obligations under the Senior
Notes and this Indenture; (ii) immediately after giving effect to such
transaction (and treating any Indebtedness that becomes an obligation of the
Successor Company or any Subsidiary as a result of such transaction as having
been Incurred by such Successor Company or such Subsidiary at the time of such
transaction), no Default or Event of Default shall have occurred and be
continuing; (iii) immediately after giving effect to such transaction, the
Successor Company would be able to incur an additional $1.00 of Indebtedness
without violating Section 9.10(a) hereof; and (iv) the Company shall have
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger, transfer, sale, assignment,
conveyance, lease or other disposition and such supplemental indenture (if any)
comply with this Indenture and all conditions precedent provided for herein
relating to such transaction have been complied with.
SECTION 10.2 Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any sale, assignment, conveyance, transfer, lease or
other disposition of the properties and assets of the Company substantially as
an entirety in accordance with Section 10.1, the Successor Company shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such Successor Company
herein, and in the event of any such sale, assignment, conveyance, transfer or
other disposition, the Company (which term shall for this purpose mean the
Successor Company), except in the case of a lease, shall be discharged of all
obligations and covenants under this Indenture and the Senior Notes and may be
dissolved and liquidated.
SECTION 10.3 Senior Notes to Be Secured in Certain Events.
If, upon any such consolidation of the Company with or merger of the
Company into any other corporation, or upon any sale, assignment, conveyance,
transfer, lease or other disposition of the property of the Company
substantially as an entirety to any other Person, any property or assets of the
Company would thereupon become subject to any Lien to secure Pari Passu
Indebtedness or Junior Indebtedness, then unless such Lien could be created
pursuant to Section 9.16 without equally and ratably securing the Senior Notes,
the Company, prior to or
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simultaneously with such consolidation, merger, sale, assignment, conveyance,
transfer, lease or other disposition, will, as to such property or assets,
secure the Senior Notes Outstanding (together with, if the Company shall so
determine, any other Indebtedness of the Company now existing or hereinafter
created which is not subordinate in right of payment to the Senior Notes)
equally and ratably with the Pari Passu Indebtedness or prior to the Junior
Indebtedness which upon such consolidation, merger, sale, assignment,
conveyance, transfer, lease or other disposition is to become secured as to such
property or assets by such Lien.
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ARTICLE ELEVEN
REDEMPTION OF SENIOR NOTES
SECTION 11.1 Applicability of Article.
Any redemption of Senior Notes before their Stated Maturity shall be in
accordance with their terms and in accordance with this Article.
SECTION 11.2 Optional Redemption.
The Senior Notes will not be redeemable prior to August 1, 2002, except
as provided on the reverse of the Form of Senior Note set forth in Section 2.3.
SECTION 11.3 Election to Redeem; Selection by Trustee of Senior Notes
to Be Redeemed.
Any election to redeem Senior Notes shall be evidenced by a Board
Resolution. In case of any redemption at the election of the Company of less
than all the Senior Notes, the Company shall, at least 60 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Senior Notes to be redeemed and shall deliver to the
Trustee such documentation and records as shall enable the Trustee to select the
Senior Notes to be redeemed pursuant to this Section 11.3.
If less than all the Senior Notes are to be redeemed, the particular
Senior Notes to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Senior Notes not previously
called for redemption, by such method as the Trustee in its sole discretion
shall deem fair and appropriate and which may provide for the selection for
redemption of portions (equal to the minimum authorized denomination for Senior
Notes or any integral multiple thereof) of the principal amount of Senior Notes
of a denomination larger than the minimum authorized denomination for Senior
Notes.
The Trustee shall promptly notify the Company in writing of the Senior
Notes selected for redemption and, in the case of any Senior Notes selected for
partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Senior Notes shall
relate, in the case of any Senior Notes redeemed or to be redeemed only in part,
to the portion of the principal amount of such Senior Notes which has been or is
to be redeemed.
SECTION 11.4 Notice of Redemption.
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Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Senior Notes to be redeemed, at his address appearing in
the Senior Note Register.
All notices of redemption shall identify the Senior Notes to be
Redeemed (including CUSIP numbers) and shall state:
(1) the Redemption Date,
(2) the Redemption Price and accrued interest (including
Additional Interest), if any,
(3) if less than all the Outstanding Senior Notes are to
be redeemed, the identification (and, in the case of
partial redemption of any Senior Notes, the principal
amounts) of the particular Senior Notes to be
redeemed,
(4) that on the Redemption Date the Redemption Price and
accrued interest (including Additional Interest), if
any, will become due and payable upon each such
Senior Note to be redeemed and, if applicable, that
interest (including Additional Interest) thereon will
cease to accrue on and after said date, and
(5) the place or places where such Senior Notes are to be
surrendered for payment of the Redemption Price and
accrued interest (including Additional Interest), if
any.
Notice of redemption of Senior Notes to be redeemed at the election of
the Company shall be given by the Company or, at the Company's written request,
by the Trustee in the name and at the expense of the Company and shall be
irrevocable.
SECTION 11.5 Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 9.3) an amount of
money in immediately available funds sufficient to pay the Redemption Price of,
and (except if the Redemption Date shall be an Interest Payment Date) accrued
interest (including Additional Interest) on, all the Senior Notes which are to
be redeemed on that date.
SECTION 11.6 Senior Notes Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Senior Notes
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest, including any Additional Interest) such Senior Notes shall cease to
bear interest. Upon surrender of any such Senior Note for redemption in
accordance with said notice, such Senior Note shall be paid by the Company at
the Redemption Price, together with accrued interest (including any Additional
Interest) to the Redemption Date; provided, however, that installments of
interest whose stated maturity is on or prior to the
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Redemption Date shall be payable to the Holders of such Senior Notes, or one or
more Predecessor Senior Notes, registered as such at the close of business on
the relevant Regular Record Dates according to their terms and the provisions of
Section 3.8.
If any Senior Note called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall, subject
to Section 1.13 hereof, until paid, bear interest (including any Additional
Interest) from the Redemption Date at the rate prescribed therefor in the Senior
Note.
SECTION 11.7 Senior Notes Redeemed in Part.
Any Senior Note which is to be redeemed only in part shall be
surrendered at a Place of Payment therefor (with, if the Company or the Trustee
so requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by, the Holder thereof
or his attorney duly authorized in writing), and the Company shall execute, and
the Trustee shall authenticate and deliver to the Holder of such Senior Note
without service charge, a new Senior Note or Senior Notes of like tenor, of any
authorized denomination as requested by such Xxxxxx, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Senior Note so surrendered.
ARTICLE TWELVE
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 12.1 Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at the option of its Board of Directors evidenced by a
Board Resolution, at any time, elect to have either Section 12.2 or 12.3 be
applied to all Outstanding Senior Notes upon compliance with the conditions set
forth below in this Article.
SECTION 12.2 Legal Defeasance and Discharge.
Upon the Company's exercise under Section 12.1 hereof of the option
applicable to this Section 12.2, the Company shall, subject to the satisfaction
of the conditions set forth in Section 12.4, be deemed to have been discharged
from its obligations with respect to all Outstanding Senior Notes on the date
the conditions set forth below are satisfied (hereinafter, "Legal Defeasance").
For this purpose, Legal Defeasance means that the Company shall be deemed to
have paid and discharged the entire Indebtedness represented by the Outstanding
Senior Notes, which shall thereafter be deemed to be "Outstanding" only for the
purposes of Section 12.5 and the other Sections of this Indenture referred to in
(a) and (b) below, and the Company shall be deemed to have satisfied all its
other obligations under the Senior Notes and this Indenture (and the Trustee, on
written demand of and at the expense of the Company, shall execute proper
instruments acknowledging the same), except for the following provisions which
shall survive until otherwise terminated or discharged hereunder: (a) the rights
of Holders of Outstanding Senior Notes to receive solely from the trust fund
described in Section 12.4, and as more fully set forth in such Section, payments
in respect of the principal of, premium, if any, and interest (including any
Additional Interest) on such Senior Notes as and when such payments are due, (b)
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the Company's obligations with respect to such Senior Notes under Sections 3.5,
3.6, 3.7, 9.2, 9.3 and 9.5, (c) the rights, powers, trusts, duties and
immunities of the Trustee and any Authenticating Agent hereunder and the
Company's obligations in connection therewith and (d) this Article. Subject to
compliance with this Article, the Company may exercise its option under this
Section 12.2 notwithstanding the prior exercise of its option under Section
12.3.
SECTION 12.3 Covenant Defeasance.
Upon the Company's exercise under Section 12.1 of the option applicable
to this Section 12.3, the Company shall, subject to the satisfaction of the
conditions set forth in Section 12.4, be released from its obligations under the
covenants contained in Article Nine (except Sections 9.1, 9.2, 9.5 and 9.7) with
respect to the Outstanding Senior Notes on and after the date the conditions set
forth below are satisfied (hereinafter, "Covenant Defeasance"), and the Senior
Notes shall thereafter be deemed not Outstanding for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed Outstanding for all other purposes hereunder (it being
understood that such Senior Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
Outstanding Senior Notes, the Company may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document and such omission to
comply shall not constitute a Default or an Event of Default under Section 5.1,
but, except as specified above, the remainder of this Indenture and such Senior
Notes shall be unaffected thereby.
SECTION 12.4 Conditions to Legal or Covenant Defeasance.
The following shall be the conditions precedent to the effectiveness of
any Legal Defeasance or Covenant Defeasance:
(a) the Company shall (i) irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders, unencumbered cash in
United States dollars, unencumbered U.S. Government Obligations,
or a combination thereof, in such amounts as will be sufficient,
in a written opinion of a nationally recognized firm of
independent public accountants delivered to the Trustee, to pay
the principal of, premium, if any, and interest (including any
Additional Interest) on the outstanding Senior Notes on the
stated date for payment thereof or on the applicable Redemption
Date, as the case may be, and the Company must specify whether
the Senior Notes are being defeased to maturity or to a
particular Redemption Date, and (ii) irrevocably instruct the
Trustee to apply such cash and U.S. Government Obligations to
such payments with respect to the Senior Notes;
(b) in the case of an election under Section 12.2, the Company shall
have delivered to the Trustee an Opinion of Counsel in the United
States confirming that (A) the Company has received from, or
there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this Indenture, there has been a
change in the applicable federal income tax law, in either case
to the effect that, and based thereon such Opinion of Counsel
shall confirm that, the Holders of the
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Outstanding Senior Notes will not recognize income, gain or loss
for federal income tax purposes as a result of such Legal
Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have
been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 12.3 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the
United States confirming that the Holders of the Outstanding
Senior Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and
will be subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if
such Covenant Defeasance has not occurred;
(d) no Default or Event of Default shall have occurred and be
continuing (i) on the date of such deposit (other than a Default
or Event of Default resulting from the Incurrence of Indebtedness
all or a portion of the proceeds of which will be used to defease
the Senior Notes pursuant to this Article concurrently with such
Incurrence) and (ii) insofar as Section 5.1(f) hereof is
concerned, at any time during the period ending on the 91st day
after the date of deposit (such condition not being satisfied
until such 91st day) ;
(e) such Legal Defeasance or Covenant Defeasance shall not result in
a breach or violation of, or constitute a default under, any
material agreement or instrument (other than this Indenture) to
which the Company or any of its Subsidiaries is a party or by
which the Company or any of its Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that on the 91st day following the deposit,
the trust funds will not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally;
(g) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company
with the intent of preferring the Holders over any other
creditors of the Company or with the intent of defeating,
hindering, delaying or defrauding any other creditors of the
Company; and
(h) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the Legal
Defeasance or the Covenant Defeasance have been complied with.
SECTION 12.5 Deposited Money and U.S. Government Obligations To Be Held
in Trust; Other Miscellaneous Provisions.
Subject to Section 12.6, all money and U.S. Government Obligations
(including the proceeds thereof) deposited with the Trustee pursuant to Section
12.4 in respect of the Outstanding Senior Notes shall be held in trust and
applied by the Trustee, in accordance with the provisions of the Senior Notes
and this Indenture, to the payment, either directly or through any Paying Agent
(excluding the Company acting as Paying Agent) as the Trustee may
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determine, to the Holders of such Senior Notes of all sums due and to become due
thereon in respect of principal, premium, if any, and interest (including any
Additional Interest), but such money need not be segregated from other funds
except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or U.S. Government
Obligations deposited pursuant to Section 12.4 or the principal and interest
received in respect thereof.
Anything in this Article to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the written request
of the Company any money or U.S. Government Obligations held by it as provided
in Section 12.4 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
12.4), are in excess of the amount thereof that would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
SECTION 12.6 Reinstatement.
If the Trustee or Paying Agent is unable to apply any cash or U.S.
Government Obligations in accordance with Section 12.2 or 12.3, as the case may
be, by reason of any order or judgment of any court or Governmental Authority
enjoining, restraining or otherwise prohibiting such application, then the
Company's obligations under this Indenture and the Senior Notes shall be revived
and reinstated as though no deposit had occurred pursuant to Section 12.2 or
12.3 until such time as the Trustee or Paying Agent is permitted to apply all
such money in accordance with Section 12.2 or 12.3, as the case may be;
provided, however, that, if the Company makes any payment of principal of,
premium, if any, or interest (including any Additional Interest) on any Senior
Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Senior Notes to receive such
payment from the money held by the Trustee or Paying Agent.
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ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.1. No Recourse Against Others.
A director, officer, employee, stockholder or incorporator, as such, of
the Company shall not have any liability for any obligations of the Company
under the Senior Notes or this Indenture or for any claim based on, in respect
of or by reason of such obligations or their creation. Each Holder by accepting
a Senior Note waives and releases all such liability.
SECTION 13.2. Execution in Counterparts.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the day and year first above written.
RESOURCE AMERICA, INC.
By:_______________________________
Name:_____________________________
Title:____________________________
THE BANK OF NEW YORK, as Trustee
By:_______________________________
Name:_____________________________
Title:____________________________
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