EXHIBIT 4.4
===============================================================================
STERLING BANCSHARES, INC.
-----------------------------
INDENTURE
DATED AS OF MARCH 21, 2001
-----------------------------
BANKERS TRUST COMPANY,
AS TRUSTEE
-----------------------------
JUNIOR SUBORDINATED DEBT SECURITIES, ISSUABLE IN SERIES
================================================================================
+TIE-SHEET
of provisions of Trust Indenture Act of 1939 with Indenture dated as of
March 21, 2001 between Sterling Bancshares, Inc. and Bankers Trust Company, as
Trustee:
ACT Section INDENTURE Section
310 (a) (1)..............................................................6.9
(a) (2)..............................................................6.9
310 (a) (3)..............................................................N/A
(a) (4)..............................................................N/A
310 (a) (5).......................................................6.10, 6.11
310 (b)..................................................................N/A
310 (c).................................................................6.13
311 (a) and (b)..........................................................N/A
311 (c)..........................................................4.1, 4.2(a)
312 (a)..................................................................4.2
312 (b) and (c)..........................................................4.4
313 (a)..................................................................4.4
313 (b) (1)..............................................................4.4
313 (b) (2)..............................................................4.4
313 (c)..................................................................4.4
313 (d)..................................................................4.4
314 (a)..................................................................4.3
314 (b)..................................................................N/A
314 (c) (1) and (2)......................................................6.7
314 (c) (3)..............................................................N/A
314 (d)..................................................................N/A
314 (e)..................................................................6.7
314 (f)..................................................................N/A
315 (a) (c) and (d)......................................................6.1
315 (b)..................................................................5.8
315 (e)..................................................................5.9
316 (a) (1)..............................................................5.7
316 (a) (2)..............................................................N/A
316 (a) last sentence....................................................2.9
316 (b)..................................................................9.2
317 (a)..................................................................5.5
317 (b)..................................................................6.5
318 (a).................................................................13.8
THIS TIE-SHEET IS NOT PART OF THE INDENTURE AS EXECUTED.
TABLE OF CONTENTS
Page
----
ARTICLE I DEFINITIONS..........................................................1
SECTION 1.1 Definitions....................................................1
"Additional Provisions"......................................................1
"Affiliate"..................................................................1
"Authenticating Agent".......................................................1
"Bankruptcy Law".............................................................1
"Board of Directors".........................................................1
"Board Resolution"...........................................................1
"Business Day"...............................................................2
"Certificate"................................................................2
"Certificate of Authentication"..............................................2
"Commission".................................................................2
"Common Securities"..........................................................2
"Common Securities Guarantee"................................................2
"Common Stock"...............................................................2
"Company"....................................................................2
"Company Request" or "Company Order".........................................2
"Custodian"..................................................................2
"Declaration"................................................................2
"Default"....................................................................2
"Defaulted Interest".........................................................2
"Definitive Securities"......................................................2
"Depositary".................................................................2
"Direct Action"..............................................................3
"Distributions"..............................................................3
"Event of Default"...........................................................3
"Exchange Act"...............................................................3
"Federal Reserve"............................................................3
"Global Security"............................................................3
"Indebtedness"...............................................................3
"Indenture"..................................................................3
"Interest Payment Date,".....................................................3
"Mortgage"...................................................................3
"Officers"...................................................................3
"Officers' Certificate"......................................................3
"Opinion of Counsel".........................................................3
"Other Debentures"...........................................................3
"Other Guarantees"...........................................................4
"Outstanding"................................................................4
"Person".....................................................................4
"Predecessor Security".......................................................4
"Preferred Securities".......................................................4
"Preferred Securities Guarantee".............................................4
"Principal Office of the Trustee"............................................4
"Property Trustee"...........................................................4
"Responsible Officer"........................................................4
"Securities" or "Security"...................................................5
"Securities Act".............................................................5
"Securityholder," "holder of Securities,"....................................5
"Securities Register"........................................................5
---------------------
* This Table of Contents shall not, for any purpose, be deemed to be a
part of the Indenture.
i
"Senior Indebtedness"........................................................5
"Sterling Capital Trust" or the "Trust"......................................5
"Subsidiary".................................................................5
"Trustee"....................................................................5
"Trust Indenture Act"........................................................5
"Trust Securities"...........................................................5
"U.S. Government Obligations"................................................5
SECTION 1.2 Business Day Certificate.......................................6
ARTICLE II SECURITIES..........................................................6
SECTION 2.1 Forms Generally................................................6
SECTION 2.2 Amount Unlimited; Issuable in Series...........................6
SECTION 2.3 Execution and Authentication...................................8
SECTION 2.4 Authentication and Dating......................................8
SECTION 2.5 Date and Denomination of Securities............................9
SECTION 2.6 Transfer and Exchange.........................................10
SECTION 2.7 Replacement Securities........................................11
SECTION 2.8 Temporary Securities..........................................11
SECTION 2.9 Cancellation..................................................11
SECTION 2.10 Global Securities.............................................11
SECTION 2.11 Cusip Numbers.................................................12
ARTICLE III PARTICULAR COVENANTS OF THE COMPANY...............................12
SECTION 3.1 Payment of Principal and Interest.............................12
SECTION 3.2 offices for Notices and Payments, etc.........................13
SECTION 3.3 Appointments to Fill Vacancies in trustee's Office............13
SECTION 3.4 Provision as to Paying Agent..................................13
SECTION 3.5 Certificate to Trustee........................................14
SECTION 3.6 Compliance with Consolidation Provisions......................14
SECTION 3.7 Limitation on Dividends.......................................14
SECTION 3.8 Covenants as to Sterling Capital Trusts.......................14
ARTICLE IV SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE..15
SECTION 4.1 Securityholders' Lists........................................15
SECTION 4.2 Preservation and Disclosure of Lists..........................15
SECTION 4.3 Reports by the Company........................................16
SECTION 4.4 Reports by the Trustee........................................17
ARTICLE V REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT.....17
SECTION 5.1 Events of Default.............................................17
SECTION 5.2 Payment of Securities on Default; Suit Therefor...............18
SECTION 5.3 Application of Moneys Collected by Trustee....................19
SECTION 5.4 Proceedings by Securityholders................................20
SECTION 5.5 Proceedings by Trustee........................................20
SECTION 5.6 Remedies Cumulative and Continuing............................21
SECTION 5.7 Direction of Proceedings and Waiver of Defaults by
Majority of Securityholders...................................21
SECTION 5.8 Notice of Defaults............................................21
SECTION 5.9 Undertaking to Pay Costs......................................22
SECTION 5.10 Requirement to Post Bond......................................22
ARTICLE VI CONCERNING THE TRUSTEE.............................................22
SECTION 6.1 Duties and Responsibilities of Trustee........................22
SECTION 6.2 Reliance on Documents, Opinions, etc..........................23
SECTION 6.3 No Responsibility for Recitals, etc...........................24
SECTION 6.4 Trustee, Authenticating Agent, Paying Agents, Transfer
agents or registrar May Own Securities........................24
ii
SECTION 6.5 Moneys to be Held in Trust....................................24
SECTION 6.6 Compensation and Expenses of Trustee..........................24
SECTION 6.7 Officers' Certificate as Evidence.............................25
SECTION 6.8 Conflicting Interest of Trustee...............................25
SECTION 6.9 Eligibility of Trustee........................................25
SECTION 6.10 Resignation or Removal of Trustee.............................25
SECTION 6.11 Acceptance by Successor Trustee...............................26
SECTION 6.12 Succession by Merger, etc.....................................27
SECTION 6.13 Limitation on Rights of Trustee as a Creditor.................27
SECTION 6.14 Authenticating Agents.........................................28
ARTICLE VII CONCERNING THE SECURITYHOLDERS....................................28
SECTION 7.1 Action by Securityholders.....................................28
SECTION 7.2 Proof of Execution by Securityholders.........................29
SECTION 7.3 Who are Deemed Absolute Owners................................29
SECTION 7.4 Securities Owned by Company Deemed Not Outstanding............29
SECTION 7.5 Revocation of Consents; Future Holders Bound..................30
ARTICLE VIII SECURITYHOLDERS' MEETINGS........................................30
SECTION 8.1 Purposes of Meetings..........................................30
SECTION 8.2 Call of Meetings by Trustee...................................30
SECTION 8.3 Call of Meetings by Company or Securityholders................30
SECTION 8.4 Qualifications for Voting.....................................31
SECTION 8.5 Regulations...................................................31
SECTION 8.6 Voting........................................................31
ARTICLE IX SUPPLEMENTAL INDENTURES............................................32
SECTION 9.1 Supplemental Indentures Without Consent of Securityholders....32
SECTION 9.2 Supplemental Indentures With Consent of Securityholders.......33
SECTION 9.3 Compliance With Trust Indenture Act; Effect of
Supplemental Indentures.......................................34
SECTION 9.4 Notation on Securities........................................34
SECTION 9.5 Evidence of Compliance of Supplemental Indenture to be
Furnished trustee.............................................34
ARTICLE X CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE...................34
SECTION 10.1 Company May Consolidate, etc., on Certain Terms...............34
SECTION 10.2 Successor Corporation to be Substituted For Company...........35
SECTION 10.3 Opinion of Counsel to be Given Trustee........................35
ARTICLE XI SATISFACTION AND DISCHARGE OF INDENTURE............................35
SECTION 11.1 Discharge of Indenture........................................35
SECTION 11.2 Deposited Moneys and U.S. Government Obligations to be
Held in Trust by Trustee......................................36
SECTION 11.3 Paying Agent to Repay Moneys Held.............................36
SECTION 11.4 Return of Unclaimed Moneys....................................36
SECTION 11.5 Defeasance Upon Deposit of Moneys or U.S. Government
Obligations...................................................36
ARTICLE XII IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS...37
SECTION 12.1 Indenture and Securities Solely Corporate Obligations.........37
ARTICLE XIII MISCELLANEOUS PROVISIONS.........................................37
SECTION 13.1 Successors....................................................37
SECTION 13.2 Official Acts by Successor Corporation........................38
SECTION 13.3 Surrender of Company Powers...................................38
SECTION 13.4 Addresses for Notices, etc....................................38
SECTION 13.5 Governing Law.................................................38
SECTION 13.6 Evidence oF Compliance With Conditions Precedent..............38
SECTION 13.7 Business Days.................................................38
iii
SECTION 13.8 Trust Indenture Act to Control................................39
SECTION 13.9 Table of Contents, Headings, etC..............................39
SECTION 13.10 Execution in Counterparts.....................................39
SECTION 13.11 Separability..................................................39
SECTION 13.12 Assignment....................................................39
SECTION 13.13 Acknowledgement of Rights.....................................39
ARTICLE XIV PREPAYMENT OF SECURITIES..........................................40
SECTION 14.1 Applicability of Article......................................40
SECTION 14.2 Notice of Prepayment; Selection of Securities.................40
SECTION 14.3 Payment of Securities Called for Prepayment...................40
ARTICLE XV SUBORDINATION OF SECURITIES........................................41
SECTION 15.1 Agreement to Subordinate......................................41
SECTION 15.2 Default on Senior Indebtedness................................41
SECTION 15.3 Liquidation; Dissolution; Bankruptcy..........................41
SECTION 15.4 Subrogation...................................................42
SECTION 15.5 Trustee to Effectuate Subordination...........................43
SECTION 15.6 Notice by the Company.........................................43
SECTION 15.7 Rights of the Trustee; Holders of Senior Indebtedness.........44
SECTION 15.8 Subordination May xxX Be Impaired.............................44
iv
THIS INDENTURE, dated as of March 21, 2001, between Sterling Bancshares,
Inc. a Texas corporation (hereinafter sometimes called the "Company"), and
Bankers Trust Company, a New York banking corporation, as trustee (hereinafter
sometimes called the "Trustee"),
W I T N E S S E T H :
WHEREAS, for its lawful corporate purposes, the Company has duly authorized
the issuance from time to time of its junior subordinated unsecured debentures,
notes or other evidences of indebtedness to be issued in one or more series (the
"Securities") up to such principal amount or amounts as may from time to time be
authorized in accordance with the terms of this Indenture and, to provide the
terms and conditions upon which the Securities are to be authenticated, issued
and delivered, the Company has duly authorized the execution of this Indenture.
NOW, THEREFORE, in consideration of the premises, and the purchase of the
Securities by the holders thereof, the Company covenants and agrees with the
Trustee for the equal and proportionate benefit of the respective holders from
time to time of the Securities or a series thereof, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions.
The terms defined in this Section 1.1 (except as herein or in any indenture
supplemental hereto otherwise expressly provided or unless the context otherwise
requires) for all purposes of this Indenture and of any indenture supplemental
hereto shall have the respective meanings specified in this Section 1.1. All
other terms used in this Indenture which are defined in the Trust Indenture Act,
or which are by reference therein defined in the Securities Act, shall (except
as herein or in any indenture supplemental hereto otherwise expressly provided
or unless the context otherwise requires) have the meanings assigned to such
terms in said Trust Indenture Act and in said Securities Act as in force at the
date of this Indenture as originally executed. All accounting terms used herein
and not expressly defined shall have the meanings assigned to such terms in
accordance with generally accepted accounting principles, and the term
"generally accepted accounting principles" means such accounting principles as
are generally accepted at the time of any computation. The words "herein",
"hereof" and "hereunder" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision. Headings are used for convenience of reference only and do not
affect interpretation. The singular includes the plural and vice versa.
"Additional Provisions" shall have the meaning given to such term in
Section 15.1.
"Affiliate" shall have the meaning given to that term in Rule 405 under
the Securities Act or any successor rule thereunder.
"Authenticating Agent" shall mean any agent or agents of the Trustee which
at the time shall be appointed and acting pursuant to Section 6.14.
"Bankruptcy Law" shall mean Title 11, U.S. Code, or any similar Federal
or state law for the relief of debtors.
"Board of Directors" shall mean either the Board of Directors of the
Company or any duly authorized committee of that board.
"Board Resolution" shall mean a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
1
"Business Day" shall mean, with respect to any series of Securities, any
day other than a Saturday or a Sunday or a day on which banking institutions in
New York, New York or Houston, Texas are authorized or required by law or
executive order to close.
"Certificate" shall mean a certificate signed by a principal executive
officer, the principal financial officer or the principal accounting officer
of the Company.
"Certificate of Authentication" shall mean the certificate issued by the
Trustee or the Authenticating Agent as to the form of Security issued under
the Indenture.
"Commission" shall mean the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or if at any time
after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Securities" beneficial interests in the assets of a Sterling
Capital Trust which rank pari passu with Preferred Securities issued by such
Sterling Capital Trust; provided, however, that if an Event of Default has
occurred and is continuing, no payments in respect of Distributions on, or
payments upon liquidation, redemption or otherwise with respect to, the Common
Securities shall be made until the holders of the Preferred Securities shall be
paid in full the Distributions and the liquidation, redemption and other
payments to which they are entitled.
"Common Securities Guarantee" shall mean any guarantee that the Company
may enter into with any Person or Persons that operates directly or indirectly
for the benefit of holders of Common Securities of a Sterling Capital Trust.
"Common Stock" shall mean the Common Stock, par value $1.00 per share, of
the Company or any other class of stock resulting from changes or
reclassifications of such Common Stock consisting solely of changes in par
value, or from par value to no par value, or from no par value to par value.
"Company" shall mean Sterling Bancshares, Inc., a Texas corporation, and,
subject to the provisions of Article X, shall include its successors and
assigns.
"Company Request" or "Company Order" shall mean a written request or
order signed in the name of the Company by the Chairman, the Chief Executive
Officer, the President, a Vice Chairman, a Vice President, the Comptroller, the
Secretary or an Assistant Secretary of the Company, and delivered to the
Trustee.
"Custodian" shall mean any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.
"Declaration" with respect to a Sterling Capital Trust, shall mean the
governing instrument of such Sterling Capital Trust, as amended from time to
time.
"Default" means any event, act or condition that with notice or lapse of
time, or both, would constitute an Event of Default.
"Defaulted Interest" shall have the same meaning set forth in Section 2.5.
"Definitive Securities" shall mean those securities issued in fully
registered certificated form not otherwise in global form.
"Depositary" shall mean, with respect to Securities of any series, for
which the Company shall determine that such Securities will be issued as a
Global Security, The Depository Trust Company, New York, New York, another
clearing agency, or any successor registered as a clearing agency under the
Exchange Act or other
2
applicable statute or regulation, which, in each case, shall be designated by
the Company pursuant to Section 2.2 and 2.10.
"Direct Action" shall have the meaning set forth in the Declaration of
the applicable Sterling Capital Trust.
"Distributions" shall have the meaning set forth in the Declaration of
the applicable Sterling Capital Trust.
"Event of Default" shall mean any event specified in Section 5.1,
continued for the period of time, if any, and after the giving of the notice, if
any, therein designated.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Federal Reserve" shall mean the Board of Governors of the Federal
Reserve System.
"Global Security" means, with respect to any series of Securities, a S
ecurity of such series executed by the Company and delivered by the Trustee to
the Depositary or pursuant to the Depositary's instruction, all in accordance
with the Indenture, which shall be registered in the name of the Depositary or
its nominee.
"Indebtedness" shall mean (i) every obligation of the Company for money
borrowed; (ii) every obligation of the Company evidenced by bonds, debentures,
notes or other similar instruments, including obligations incurred in connection
with the acquisition of property, assets or businesses; (iii) every
reimbursement obligation of the Company with respect to letters of credit,
banker's acceptances or similar facilities issued for the account of the Company
to the extent such reimbursement obligation is no longer contingent upon a draw
by or advance to or on behalf of the Company; (iv) every obligation of the
Company issued or assumed as the deferred purchase price of property or services
(but excluding trade accounts payable or accrued liabilities arising in the
ordinary course of business); (v) every capital lease obligation of the Company;
(vi) all indebtedness of the Company whether incurred on or prior to the date of
this Indenture or thereafter incurred, for claims in respect of derivative
products, including interest rate, foreign exchange rate and commodity forward
contracts, options and swaps and similar arrangements; and (vii) every
obligation of the type referred to in clauses (i) through (vi) of another Person
and all dividends of another Person the payment of which, in either case, the
Company has guaranteed or is responsible or liable for, directly or indirectly,
as obligor or otherwise.
"Indenture" shall mean this instrument as originally executed or, if
amended or supplemented by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof and that include the terms of
a particular series of Securities established as contemplated by Section 2.2.
"Interest Payment Date," when used with respect to any installment of
interest on a Security of a particular series, shall mean the date specified in
such Security or in a Board Resolution or in an indenture supplemental hereto
with respect to such series as the fixed date on which an installment of
interest with respect to Securities of that series is due and payable.
"Mortgage" shall mean and include any mortgage, pledge, lien, security
interest, conditional sale or other title retention agreement or other similar
encumbrance.
"Officers" shall mean any of the Chairman, the Chief Executive Officer,
the President, a Vice President, the Chief Financial Officer, the Secretary or
an Assistant Secretary of the Company.
"Officers' Certificate" shall mean a certificate signed by two Officers
and delivered to the Trustee.
"Opinion of Counsel" shall mean a written opinion of counsel, who may be
the general counsel of the Company acceptable to the Trustee.
"Other Debentures" means all junior subordinated debentures issued by the
Company from time to time and sold to trusts to be established by the Company
(if any), in each case similar to a Sterling Capital Trust.
3
"Other Guarantees" means all guarantees to be issued by the Company with
respect to preferred securities (if any) not constituting Preferred Securities
and issued to other trusts to be established by the Company (if any), in each
case similar to a Sterling Capital Trust.
"Outstanding" when used with reference to the Securities, shall mean,
subject to the provisions of Section 7.4, as of any particular time, all
Securities authenticated and delivered by the Trustee or the Authenticating
Agent under this Indenture, except:
(a) Securities theretofore cancelled by the Trustee or the
Authenticating Agent or delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or redemption
of which moneys in the necessary amount shall have been deposited in trust with
the Trustee or with any paying agent (other than the Company) or shall have been
set aside and segregated in trust by the Company (if the Company shall act as
its own paying agent); provided that, if such Securities, or portions thereof,
are to be redeemed prior to maturity thereof, notice of such redemption shall
have been given as in Article XIV or provision satisfactory to the Trustee shall
have been made for giving such notice; and
(c) Securities in lieu of or in substitution for which other
Securities shall have been authenticated and delivered pursuant to the terms of
Section 2.7 unless proof satisfactory to the Company and the Trustee is
presented that any such Securities in lieu of or in substitution for which other
Securities have been so authenticated and delivered are held by bona fide
holders in due course.
"Person" shall mean any individual, corporation, estate, partnership,
joint venture, association, joint-stock company, limited liability company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 2.7 in lieu of a lost, destroyed or
stolen Security shall be deemed to evidence the same debt as the lost, destroyed
or stolen Security.
"Preferred Securities" shall mean undivided beneficial interests in the
assets of a Sterling Capital Trust which rank pari passu with the Common
Securities issued by such Sterling Capital Trust; provided, however, that if an
Event of Default has occurred and is continuing, no payments in respect of
Distributions on, or payments upon liquidation, redemption or otherwise with
respect to, the Common Securities shall be made until the holders of the
Preferred Securities shall be paid in full the Distributions and the
liquidation, redemption and other payments to which they are entitled.
"Preferred Securities Guarantee" shall mean any guarantee that the
Company may enter into with Bankers Trust Company or other Persons that operates
directly or indirectly for the benefit of holders of Preferred Securities.
"Principal Office of the Trustee", or other similar term, shall mean the
office of the Trustee at which the corporate trust business of the Trustee
shall, at any particular time be principally administered which office at the
date of execution of this Agreement is located at Bankers Trust Company, Four
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Property Trustee" shall have the same meaning set forth in the
Declaration of the applicable Sterling Capital Trust.
"Responsible Officer" means with respect to the Trustee, any officer
assigned to the Corporate Trust Office, including any managing director, vice
president, assistant vice president, assistant treasurer, assistant secretary or
any other officer of the Trustee customarily performing functions similar to
those performed by any of the above designated officers and having direct
responsibility for the administration of this Indenture, and also, with
4
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of such officer's knowledge of and familiarity with
the particular subject.
"Securities" or "Security" shall have the meaning stated in the first
recital of this Indenture and more particularly means any Security or
Securities, as the case may be, authenticated and delivered under this
Indenture.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Securityholder," "holder of Securities," or other similar terms, shall
mean any Person in whose name at the time a particular Security is registered on
the register kept by the Company or the Trustee for that purpose in accordance
with the terms hereof.
"Securities Register" shall have the meaning specified in Section 2.6.
"Senior Indebtedness" means the principal of and interest, if any
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not such
claim for post-petition interest is allowed in such proceeding), on Indebtedness
of the Company, whether incurred on or prior to the date of this Indenture or
thereafter incurred, unless, in the instrument creating or evidencing the same
or pursuant to which the same is outstanding it is provided that such
obligations are not superior in right of payment to the Securities or other
Indebtedness which is pari passu with, or subordinated to the Securities,
provided, however, that Senior Indebtedness shall not be deemed to include (a)
any Indebtedness of the Company which, when incurred and without respect to any
election under Section 1111 (b) of the Bankruptcy Reform Act of 1978, as
amended, was without recourse to the Company, (b) any Indebtedness of the
Company to any of its Subsidiaries, (c) Indebtedness to any employee of the
Company, and (d) any Securities.
"Sterling Capital Trust" or the "Trust" shall mean each of Sterling
Bancshares Capital Trust II, and Sterling Bancshares Capital Trust III, each a
Delaware business trust created for the purpose of issuing its undivided
beneficial interests in connection with the issuance of Securities under this
Indenture.
"Subsidiary" shall mean with respect to any Person, (i) any corporation
at least a majority of the outstanding voting stock of which is owned, directly
or indirectly, by such Person or by one or more of its Subsidiaries, or by such
Person and one or more of its Subsidiaries, (ii) any general partnership, joint
venture or similar entity, at least a majority of whose outstanding partnership
or similar interests shall at the time be owned by such Person, or by one or
more of its Subsidiaries, or by such Person and one or more of its Subsidiaries
and (iii) any limited partnership of which such Person or any of its
Subsidiaries is a general partner. For the purposes of this definition, "voting
stock" means shares, interests, participations or other equivalents in the
equity interest (however designated) in such Person having ordinary voting power
for the election of a majority of the directors (or the equivalent) of such
Person, other than shares, interests, participations or other equivalents having
such power only by reason of the occurrence of a contingency.
"Trustee" shall mean the Person identified as "Trustee" in the first
paragraph hereof, and, subject to the provisions of Article VI hereof, shall
also include its successors and assigns as Trustee hereunder. The term "Trustee"
as used with respect to a particular series of the Securities shall mean the
trustee with respect to that series.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939 as in
force at the date of execution of this Indenture, except as provided in Section
9.3; provided, however, that, in the event the Trust Indenture Act is amended
after such date, "Trust Indenture Act" shall mean, to the extent required by any
such amendment, the Trust Indenture Act as so amended.
"Trust Securities" shall mean the Preferred Securities and the Common
Securities, collectively.
"U.S. Government Obligations" shall mean securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is
5
unconditionally guaranteed as a full faith and credit obligation by the United
States of America, which, in either case under clauses (i) or (ii) are not
callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank or trust company as custodian with
respect to any such U.S. Government Obligation or a specific payment of interest
on or principal of any such U.S. Government Obligation held by such custodian
for the account of the holder of a depository receipt, provided that (except as
required by law) such custodian is not authorized to make any deduction from the
amount payable to the holder of such depository receipt from any amount received
by the custodian in respect of the U.S. Government Obligation or the specific
payment of interest on or principal of the U.S. Government Obligation evidenced
by such depository receipt.
SECTION 1.2 Business Day Certificate.
On the date of execution and delivery of this Indenture (with respect to
the remainder of calendar year 2001) and thereafter, within 15 days prior to the
end of each calendar year while this Indenture remains in effect (with respect
to the succeeding calendar years), the Company shall deliver to the Trustee an
Officers' Certificate specifying the days on which banking institutions or trust
companies in Houston, Texas are authorized or obligated by law or executive
order to be closed.
ARTICLE II
SECURITIES
SECTION 2.1 Forms Generally
(a) The Securities of each series shall be in substantially the form as
established by or pursuant to a Board Resolution and as set forth in an
Officer's Certificate of the Company or in one or more indentures supplemental
hereto, in each case with 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 any law or with
any rules made pursuant thereto or with any rules of any securities exchange or
all as may, consistently herewith, be determined by the officers of the Company
executing such Securities, as evidenced by their execution of the Securities.
(b) The form of the Trustee's Certificate of Authentication shall be in
substantially the following form:
This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture and
[____] Supplemental Indenture.
BANKERS TRUST COMPANY,
as Trustee
By:
---------------------------------
Authorized Signatory
SECTION 2.2 Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited. The Securities may be issued in one
or more series up to the aggregate principal amount of securities of that series
from time to time authorized by or pursuant to a Board Resolution of the Company
or pursuant to one or more indentures supplemental hereto, subject, however, to
subsection (c) of the definition of "Outstanding" in Section 1.1 and the
following subsection (b) of this Section 2.2. Prior to the initial issuance of
6
Securities of any series, there shall be established in or pursuant to a Board
Resolution of the Company and set forth in an Officers' Certificate of the
Company or established in one or more indentures supplemental hereto:
(a) the title of the Securities of the series (which shall distinguish the
Securities of the series from all other Securities);
(b) any limit upon the aggregate principal amount of the Securities of the
series which may be authenticated and delivered under this Indenture (except for
Securities authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Securities of the series pursuant to Sections
2.6, 2.7, 2.8, 9.4, and 14.3);
(c) the date or dates on which the principal of and premium, if any, on
the Securities of the series is payable;
(d) the rate or rates at which the Securities of the series shall bear
interest, if any, or the method by which such interest may be determined, the
date or dates from which such interest shall accrue, the Interest Payment Dates
on which such interest shall be payable or the manner of determination of such
Interest Payment Dates and the record dates for the determination of holders to
whom interest is payable on any such Interest Payment Dates;
(e) the place or places where the principal of, and premium, if any, and
any interest on Securities of the series shall be payable;
(f) the right, if any, to extend the interest payment periods and the
duration of such extension;
(g) the price or prices at which, the period or periods within which and
the terms and conditions upon which Securities of the series may be prepaid or
redeemed, in whole or in part, at the option of the Company, pursuant to any
sinking fund or otherwise;
(h) the obligation, if any, of the Company to prepay, redeem, purchase
or repay Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a Securityholder thereof and the price or prices
at which, and the period or periods within which, and the terms and conditions
upon which, Securities of the series shall be prepaid, redeemed, purchased or
repaid, in whole or in part, pursuant to such obligation;
(i) if other than denominations of $25 and any integral multiple thereof,
the denominations in which Securities of the series shall be issuable;
(j) any Events of Default with respect to the Securities of a particular
series, if not set forth herein;
(k) the form of the Securities of the series including the form of the
Certificate of Authentication of such series (which shall be consistent with
Section 2.1(b);
(l) any trustee, authenticating or paying agents, warrant agents, transfer
agents or registrars with respect to the Securities of such series;
(m) whether the Securities of the series shall be issued in whole or in
part in the form of one or more Global Securities and, in such case, the
Depositary for such Global Security or Securities, and whether beneficial owners
of interests in any such Global Securities may exchange such interests for other
Securities of such series in the manner provided in Section 2.6, and the manner
and the circumstances under which and the place or places where any such
exchanges may occur if other than in the manner provided in Section 2.6, and any
other terms of the series relating to the global nature of the Global Securities
of such series and the exchange, registration or transfer thereof and the
payment of any principal thereof, or interest or premium, if any, thereon; and
(n) any other terms of the series (which terms shall not be inconsistent
with the provisions of this Indenture).
7
All Securities of any one series shall be substantially identical except as
to denomination and except as may otherwise be provided in or pursuant to such
resolution of the Board of Directors or in any such indenture supplemental
hereto.
If any of the terms of the series are established by action taken pursuant
to a Board Resolution of the Company, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the
Officers' Certificate of the Company setting forth the terms of the series.
SECTION 2.3 Execution and Authentication.
Two Officers shall sign the Securities for the Company by manual or
facsimile signature. If an Officer whose signature is on a Security no longer
holds that office at the time the Security is authenticated, the Security shall
nevertheless be valid.
A Security shall not be valid until authenticated by the manual signature
of the Trustee. The signature of the Trustee shall be conclusive evidence that
the Security has been authenticated under this Indenture. The form of Trustee's
certificate of authentication to be borne by the Securities shall be
substantially as set forth in Section 2.1(b) hereto.
SECTION 2.4 Authentication and Dating.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver said Securities to or upon a Company Order, without any
further action by the Company hereunder. In authenticating such Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive, and (subject to
Section 6.1) shall be fully protected in relying upon:
(a) a copy of any Board Resolution or Resolutions relating thereto and, if
applicable, an appropriate record of any action taken pursuant to such
resolution, in each case certified by the Secretary or an Assistant Secretary of
the Company;
(b) an executed supplemental indenture, if any;
(c) an Officers' Certificate setting forth the form and terms of the
Securities as required pursuant to Section 2.1 and Section 2.2, respectively;
and
(d) an Opinion of Counsel prepared in accordance with Section 13.6 which
shall also state:
(i) that the form of such Securities has been established by or
pursuant to a resolution of the Board of Directors or by supplemental
indenture as permitted by Section 2.1 in conformity with the provisions of
this Indenture;
(ii) that the terms of such Securities have been established by or
pursuant to a resolution of the Board of Directors or by supplemental
indenture as permitted by Section 2.2 in conformity with the provisions of
this Indenture;
(iii) that such Securities, when authenticated and delivered by the
Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company;
(iv) that all laws and requirements in respect of the execution and
delivery by the Company of the Securities have been complied with and
that authentication and delivery of the Securities by the Trustee will
not violate the terms of the Indenture; and
8
(v) such other matters as the Trustee may reasonably request.
The Trustee shall have the right to decline to authenticate and deliver any
Securities under this Section if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken or if the Trustee in good
faith by its board of directors or trustees, executive committee, or a trust
committee of directors or trustees and/or vice presidents shall determine that
such action would expose the Trustee to personal liability to existing holders.
SECTION 2.5 Date and Denomination of Securities.
The Securities shall be issuable in such form and in such denominations as
shall be specified as contemplated by Section 2.2. In the absence of any such
specification with respect to the Securities of any series, the Securities of
such Series shall be issuable as registered Securities without coupons and in
the denominations of $25 and any multiple thereof. The Securities shall be
numbered, lettered, or otherwise distinguished in such manner or in accordance
with such plans as the officers of the Company executing the same may determine
with the approval of the Trustee as evidenced by the execution and
authentication thereof.
Every Security shall be dated the date of its authentication, shall bear
interest, if any, from such date and shall be payable on such dates, in each
case, as contemplated by Section 2.2. The interest installment on any Security
that is payable, and is punctually paid or duly provided for, on any Interest
Payment Date for Securities of that series shall be paid to the Person in whose
name said Security (or one or more Predecessor Securities) is registered at the
close of business on the regular record date for such interest installment. In
the event that any Security of a particular series or portion thereof is called
for redemption and the redemption date is subsequent to a regular record date
with respect to any Interest Payment Date and prior to such Interest Payment
Date, interest on such Security will be paid upon presentation and surrender of
such Security as provided in Section 3.1.
Any interest on any Security that is payable, but is not punctually paid or
duly provided for, on any Interest Payment Date for any Security of the same
series (herein called "Defaulted Interest") shall forthwith cease to be payable
to the registered holder on the relevant regular record date by virtue of having
been such holder, and such Defaulted Interest shall be paid by the Company, at
its election, as provided in clause (a) or clause (b) below:
(a) The Company may make payment of any Defaulted Interest on Securities
to the Persons in whose names such Securities (or their respective Predecessor
Securities) are registered at the close of business on a special record date for
the payment of such Defaulted Interest, which shall be fixed in the following
manner: the Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each such Security and the date of the
proposed payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements satisfactory to
the Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons entitled
to such Defaulted Interest as in this clause provided. Thereupon the Trustee
shall fix a special record date for the payment of such Defaulted Interest which
shall not be more than 15 nor less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the Trustee of
the notice of the proposed payment. The Trustee shall promptly notify the
Company of such special record date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted Interest
and the special record date therefor to be mailed, first class postage prepaid,
to each Securityholder at his or her address as it appears in the Security
Register, not less than 10 days prior to such special record date. Notice of the
proposed payment of such Defaulted Interest and the special record date therefor
having been mailed as aforesaid, such Defaulted Interest shall be paid to the
Persons in whose names such Securities (or their respective Predecessor
Securities) are registered on such special record date and shall be no longer
payable pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted Interest on any
Securities in any other lawful manner not inconsistent with the requirements of
any securities exchange on which such Securities may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the
Company to the Trustees of the proposed payment pursuant to this clause, such
manner of payment shall be deemed practicable by the Trustee.
9
Unless otherwise set forth in a Board Resolution of the Company or one or
more indentures supplemental hereto establishing the terms of any series of
Securities pursuant to Section 2.2 hereof, the term "regular record date" as
used in this Section with respect to a series of Securities with respect to any
Interest Payment Date for such series shall mean either the fifteenth day of the
month in which an Interest Payment Date established for such series pursuant to
Section 2.2 hereof shall occur, if such Interest Payment Date is the last day of
a month, or the last day of the month immediately preceding the month in which
an Interest Payment Date established for such series pursuant to Section 2.2
hereof shall occur, if such Interest Payment Date is the fifteenth day of a
month, whether or not such date is a Business Day.
Subject to the foregoing provisions of this Section, each Security of a
series delivered under this Indenture upon transfer of or in exchange for or in
lieu of any other Security of such series shall carry the rights to interest
accrued and unpaid, and to accrue, that were carried by such other Secutiry.
SECTION 2.6 Transfer and Exchange.
Subject to Section 2.2(m), Securities of any series may be exchanged for a
like aggregate principal amount of Securities of the same series of other
authorized denominations. Securities to be exchanged may be surrendered at the
principal office of the Trustee or at any office or agency to be maintained by
the Company for such purpose as provided in Section 3.2, and the Company or the
Trustee shall execute and register and the Trustee or the Authenticating Agent
shall authenticate and deliver in exchange therefor the Security or Securities
which the Securityholder making the exchange shall be entitled to receive. Upon
due presentment for registration of transfer of any Security of any series at
the principal office of the Trustee or at any office or agency of the Company
maintained for such purpose as provided in Section 3.2, the Company or the
Trustee shall execute and register and the Trustee or the Authenticating Agent
shall authenticate and deliver in the name of the transferee or transferees a
new Security or Securities of the same series for a like aggregate principal
amount. Registration or registration of transfer of any Security by the Trustee
or by any agent of the Company appointed pursuant to Section 3.2, and delivery
of such Security, shall be deemed to complete the registration or registration
of transfer of such Security.
The Company shall cause to be kept at the corporate trust office of the
Trustee a register in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Securities and of
transfers of Securities. Such register is herein sometimes referred to as the
"Securities Register."
To permit registrations of transfers and exchanges, the Company shall
execute and the Trustee, upon receipt of a Company Order, shall authenticate
Definitive Securities and Global Securities at the Security Registrar's request.
All Definitive Securities and Global Securities issued upon any registration of
transfer or exchange of Definitive Securities or Global Securities shall be the
valid obligations of the Company, evidencing the same debt, and entitled to the
same benefits under this Indenture, as the Definitive Securities or Global
Securities surrendered upon such registration of transfer or exchange.
Upon surrender for registration of transfer of any Security at the office
or agency of the Company designated for that purpose the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of the same series of any
authorized denominations, of a like aggregate principal amount, of the same
original same issue date and Stated Maturity Date and having the same terms.
No service charge shall be made to a holder for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith.
The Company shall not be required to (i) issue, register the transfer of or
exchange Securities during a period beginning at the opening of business 15 days
before the day of mailing of a notice of redemption or any notice of selection
of Securities of such series for redemption; or (ii) register the transfer of or
exchange any Security of such series so selected for redemption in whole or in
part, except the unredeemed portion of any Security of such series being
redeemed in part.
10
Prior to due presentment for the registration of a transfer of any
Security, the Trustee, the Company and any agent of the Trustee or the Company
may deem and treat the Person in whose name any Security is registered as the
absolute owner of such Security for the purpose of receiving payment of
principal of and premium, if any, and interest on such Securities, and for all
other purposes whatsoever, and none of the Trustee, the Company and any agents
of the Trustee or the Company shall be affected by notice afftecte by notice to
the contrary.
SECTION 2.7 Replacement Securities.
If any mutilated Security is surrendered to the Trustee, or the Company and
the Trustee receive evidence to their satisfaction of the destruction, loss or
theft of any Security, the Company shall issue and the Trustee shall
authenticate a replacement Security if the Trustee's requirements for
replacements of Securities are met. An indemnity bond must be supplied by the
holder that is sufficient in the judgment of the Trustee and the Company to
protect the Company, the Trustee, any agent thereof or any authenticating agent
from any loss that any of them may suffer if a Security is replaced. The
Company or the Trustee may charge for its expenses in replacing a Security.
Every replacement Security is an obligation of the Company and shall be
entitled to all of the benefits of this Indenture equally and proportionately
with all other Securities duly issued hereunder.
SECTION 2.8 Temporary Securities.
Pending the preparation of Definitive Securities, the Company may execute,
and upon Company Order the Trustee shall authenticate and make available for
delivery, temporary Securities that are printed, lithographed, typewritten,
mimeographed or otherwise reproduced, in any authorized denomination,
substantially of the tenor of the Definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
conclusively evidenced by their execution of such Securities.
If temporary Securities are issued, the Company shall cause Definitive
Securities to be prepared without unreasonable delay. The Definitive Securities
shall be printed, lithographed or engraved, or provided by any combination
thereof, or in any other manner permitted by the rules and regulations of any
applicable securities exchange, all as determined by the officers executing such
Definitive Securities. After the preparation of Definitive Securities, the
temporary Securities shall be exchangeable for Definitive Securities upon
surrender of the temporary Securities at the office or agency maintained by the
Company for such purpose pursuant to Section 3.2 hereof, without charge to the
Holder. Upon surrender for cancellation of anyone or more temporary Securities,
the Company shall execute, and the Trustee shall authenticate and make available
for delivery, in exchange therefor the same aggregate principal amount of
Definitive Securities of authorized denominations. Until so exchanged, the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as Definitive Securities.
SECTION 2.9 Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Trustee and no one else shall cancel all Securities
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall retain or destroy cancelled Securities in accordance with
its normal practices (subject to the record retention requirement of the
Exchange Act) unless the Company directs that they be returned to it. Subject
to Sections 2.6 and 2.7, the Company may not issue new Securities to replace
Securities that have been redeemed or paid or that have been delivered to the
Trustee for cancellation.
SECTION 2.10 Global Securities.
(a) If the Company shall establish pursuant to Section 2.2 that the
Securities of a particular series are to be issued as a Global Security, then
the Company shall execute and the Trustee shall, in accordance with Section 2.4,
authenticate and deliver, a Global Security that (i) shall represent, and shall
be denominated in an amount equal to the aggregate principal amount of, all of
the outstanding Securities of such series, (ii) shall be registered in the name
of the Depositary or its nominee, (iii) shall be delivered by the Trustee to the
Depositary or pursuant to the
11
Depositary's instruction and (iv) shall bear a legend substantially to the
following effect: "Except as otherwise provided in Section 2.10 of the
Indenture, this Security may be transferred, in whole but not in part, only to
another nominee of the Depositary or to a successor Depositary or to a nominee
of such successor Depositary."
(b) Notwithstanding the provisions of Section 2.6, the Global Security
of a series may be transferred, in whole but not in part and in the manner
provided in Section 2.6, only to another nominee of the Depositary for such
series or to a successor Depositary for such series selected or approved by the
Company or to a nominee of such successor Depositary.
(c) If at any time the Depositary for a series of the Securities
notifies the Company that it is unwilling or unable to continue as Depositary
for such series or if at any time the Depositary for such series shall no longer
be registered or in good standing under the Exchange Act, or other applicable
statute or regulation, and a successor Depositary for such series is not
appointed by the Company within 90 days after the Company receives such notice
or becomes aware of such condition, as the case may be, this Section 2.10 shall
no longer be applicable to the Securities of such series and the Company will
execute, and subject to Section 2.6, the Trustee will authenticate and deliver,
the Definitive Securities of such series, in authorized denominations, and in an
aggregate principal amount equal to the principal amount of the Global Security
of such series in exchange for such Global Security. In addition, the Company
may at any time determine that the Securities of any series shall no longer be
represented by a Global Security and that the provisions of this Section 2.10
shall no longer apply to the Securities of such series. In such event the
Company will execute and, subject to Section 2.6, the Trustee, upon receipt of
an Officers' Certificate evidencing such determination by the Company, will
authenticate and deliver the Definitive Securities of such series, in authorized
denominations, and in an aggregate principal amount equal to the principal
amount of the Global Security of such series in exchange for such Global
Security. Upon the exchange of the Global Security for such Definitive
Securities, in authorized denominations, the Global Security shall be cancelled
by the Trustee. Such Definitive Securities issued in exchange for the Global
Security pursuant to this Section 2.10(c) shall be registered in such names and
in such authorized denominations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Definitive Securities to the Depositary
for delivery to the Persons in whose names such Definitive Securities are so
registered.
SECTION 2.11 CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Securityholders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company will promptly notify
the Trustee of any change in the CUSIP numbers.
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.1 Payment of Principal and Interest.
The Company covenants and agrees for the benefit of each series of the
Securities that it will duly and punctually pay or cause to be paid the
principal of and interest on each series of the Securities at the place, at the
respective times and in the manner provided herein. Each installment of
interest on the Securities of any series may be paid by (i) mailing checks for
such interest payable to the order of the holder of Security entitled thereto as
they appear in the Security Register, or (ii) by wire transfer to an account
appropriately designated by the Holder entitled thereto, provided that proper
transfer instructions have been received in writing by the relevant record date.
12
SECTION 3.2 Offices for Notices and Payments, etc.
So long as any of the Securities remain outstanding, the Company will
maintain in the Borough of Manhattan, The City of New York, an office or agency
where the Securities of each series may be presented for payment, an office or
agency where the Securities of that series may be presented for registration of
transfer and for exchange as in this Indenture provided and an office or agency
where notices and demands to or upon the Company in respect of the Securities of
that series or of this Indenture may be served. The Company will give to the
Trustee written notice of the location of any such office or agency and of any
change of location thereof. Until otherwise designated from time to time by the
Company in a notice to the Trustee or specified as contemplated by Section 2.2,
any such office or agency for all of the above purposes shall be the Principal
Office of the Trustee. In case the Company shall fail to maintain any such
office or agency in the Borough of Manhattan, The City of New York, or shall
fail to give such notice of the location or of any change in the location
thereof, presentations and demands may be made and notices may be served at the
Principal Office of the Trustee.
In addition to any such office or agency, the Company may from time to time
designate one or more offices or agencies outside the Borough of Manhattan, The
City of New York, where the Securities may be presented for payment,
registration of transfer and for exchange in the manner provided in this
Indenture, and the Company may from time to time rescind such designation, as
the Company may deem desirable or expedient; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain any such office or agency in the Borough of Manhattan,
The City of New York, for the purposes above mentioned. The Company will give
to the Trustee prompt written notice of any such designation or rescission
thereof.
SECTION 3.3 Appointments to Fill Vacancies in Trustee's Office.
The Company, whenever necessary to avoid or fill a vacancy in the office of
Trustee, will appoint, in the manner provided in Section 6.10, a Trustee, so
that there shall at all times be a Trustee hereunder.
SECTION 3.4 Provision as to Paying Agent.
(a) If the Company shall appoint a paying agent other than the Trustee
with respect to the Securities of any series, it will cause such paying agent to
execute and deliver to the Trustee an instrument in which such agent shall agree
with the Trustee, subject to the provision of this Section 3.4,
(1) that it will hold all sums held by it as such agent for the
payment of the principal of or interest on the Securities of such
series (whether such sums have been paid to it by the Company or by
any other obligor on the Securities of such series) in trust for the
benefit of the holders of the Securities; and
(2) that it will give the Trustee notice of any failure by the
Company (or by any other obligor on the Securities of such series) to
make any payment of the principal of or interest on the Securities of
such series when the same shall be due and payable.
(b) If the Company shall act as its own paying agent, it will, on or
before each due date of the principal of or interest on the Securities of any
series, set aside, segregate and hold in trust for the benefit of the holders of
the Securities of such series a sum sufficient to pay such principal or interest
so becoming due and will notify the Trustee of any failure to take such action
and of any failure by the Company (or by any other obligor under the Securities
of such series) to make any payment of the principal of or interest on the
Securities of such series when the same shall become due and payable.
(c) Anything in this Section 3.4 to the contrary notwithstanding, the
Company may, at any time, for the purpose of obtaining a satisfaction and
discharge with respect to one or more or all series of Securities hereunder, or
for any other reason, pay or cause to be paid to the Trustee all sums held in
trust for any such series by the Trustee or any paying agent hereunder, as
required by this Section 3.4, such sums to be held by the Trustee upon the
trusts herein contained.
13
(d) Anything in this Section 3.4 to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section 3.4 is subject to
Section 11.3 and Section 11.4.
SECTION 3.5 Certificate to Trustee.
The Company will deliver to the Trustee on or before 120 days after the end
of each fiscal year in each year, commencing with the first fiscal year in which
there shall be issued any Securities of any series under this Indenture, so long
as Securities of any series are outstanding hereunder, an Officers' Certificate,
one of the signers of which shall be the principal executive, principal
financial or principal accounting officer of the Company, stating that in the
course of the performance by the signers of their duties as officers of the
Company they would normally have knowledge of any default by the Company in the
performance of any covenants contained herein, stating whether or not they have
knowledge of any such default and, if so, specifying each such default of which
the signers have knowledge and the nature thereof.
SECTION 3.6 Compliance with Consolidation Provisions.
The Company will not, while any of the Securities remain outstanding,
consolidate with, or merge into, or merge into itself, or sell or convey all or
substantially all of its property to any other Person unless the provisions of
Article X hereof are complied with.
SECTION 3.7 Limitation on Dividends.
The Company will not: (i) declare or pay any dividends or distributions on,
or redeem, purchase, acquire, or make a liquidation payment with respect to, any
of the Company's capital stock (which includes common and preferred stock)
(other than (a) dividends or distributions in shares of, or options, warrants or
rights to subscribe for or purchase shares of, Common Stock of the Company, (b)
any declaration of a dividend in connection with the implementation of a
stockholder's rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
as a result of a reclassification of any class or series of the Company's
capital stock solely into another class or series of the Company's capital
stock, (d) the purchase of fractional shares resulting from such
reclassification or pursuant to the conversion or exchange provisions of such
capital stock or any security convertible or exchangeable into shares of the
Company's capital stock, and (e) purchases of Common Stock related to the
issuance of Common Stock or rights under any of the Company's benefit plans for
its directors, officers or employees or any of the Company's dividend
reinvestment plans); (ii) make any payment of principal, premium, if any, or
interest on or repay or repurchase or redeem any debt securities of the Company
(including Other Debentures) that rank pari passu with or junior in right of
payment to the Securities; or (iii) make any guarantee payments (other than
payments under the Preferred Securities Guarantee) with respect to any guarantee
by the Company of the debt securities of any Subsidiary of the Company
(including Other Guarantees) if such guarantee ranks pari passu or junior in
right of payment to the Securities, if at such time (1) there shall have
occurred any event of which the Company has actual knowledge that (a) is, or
with the giving of notice or the lapse of time, or both, would constitute, an
Event of Default and (b) in respect of which the Company shall not have taken
reasonable steps to cure, or (2) if such Securities are held by the Property
Trustee, the Company shall be in default with respect to its payment obligations
under the Preferred Securities Guarantee.
SECTION 3.8 Covenants as to Sterling Capital Trusts.
In the event Securities are issued to a Sterling Capital Trust or a trustee
of such trust in connection with the issuance of Trust Securities by such
Sterling Capital Trust, for so long as such Trust Securities remain outstanding,
the Company: (i) will maintain 100% direct or indirect ownership of the Common
Securities of such Sterling Capital Trust; provided, however, that any successor
of the Company, permitted pursuant to Article X, may succeed to the Company's
ownership of such Common Securities; (ii) will use its reasonable efforts not to
voluntarily terminate, wind up or liquidate such Sterling Capital Trust except
with the prior approval of the Federal Reserve if then so required under
applicable capital guidelines or policies of the Federal Reserve, and except (a)
in connection with a distribution of Junior Subordinated Debentures to the
holders of the Trust Preferred Securities in liquidation of such Sterling
Capital Trust or (b) in connection with certain mergers, consolidations, or
amalgamations permitted by the Declaration of such Sterling Capital Trust; (iii)
will use its reasonable efforts to cause such Sterling Capital Trust (a) to
remain a business trust, except in connection with a distribution of Securities
to the holders of Trust Securities in
14
liquidation of such Sterling Capital Trust, the redemption of all of the Trust
Securities of such Sterling Capital Trust or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration of such Sterling Capital
Trust, and (b) to otherwise continue to be treated as a grantor trust for United
States Federal income tax purposes; (iv) will use its reasonable efforts to
cause each holder of the Trust Securities of such Sterling Capital Trust to be
treated as owning an undivided beneficial interest in the Securities; and (v)
will use commercially reasonable efforts to maintain the eligibility of the
Preferred Securities issued by such Sterling Capital Trust for quotation or
listing on any national securities exchange or other organization on which the
Preferred Securities are then quoted or listed (including, if applicable, The
Nasdaq National Market) and use commercially reasonable efforts to keep the
Preferred Securities so quoted or listed for so long as the Preferred Securities
remain outstanding. For so long as any Securities remain outstanding, the
Company shall fulfill all reporting and filing obligations under the Exchange
Act, as applicable to companies having a class of securities registered under
Section 12(b) or 12(g) thereunder.
ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE
SECTION 4.1 Securityholders' Lists.
The Company covenants and agrees that it will furnish or cause to be
furnished to the Trustee:
(a) on a semi-annual basis on each regular record date for each series of
Securities, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Securityholders of such series of Securities as of
such record date; and
(b) at such other times as the Trustee may request in writing, within 30
days after the receipt by the Company, of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished,
except that, no such lists need be furnished so long as the Trustee is in
possession thereof by reason of its acting as Security registrar of such series.
SECTION 4.2 Preservation and Disclosure of Lists.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the holders of
each series of Securities (1) contained in the most recent list furnished to it
as provided in Section 4.1 or (2) received by it in the capacity of Securities
registrar (if so acting) hereunder. The Trustee may destroy any list furnished
to it as provided in Section 4.1 upon receipt of a new list so furnished.
(b) In case three or more holders of Securities of any series (hereinafter
referred to as "applicants") apply in writing to the Trustee and furnish to the
Trustee reasonable proof that each such applicant has owned a Security of such
series for a period of at least six months preceding the date of such
application, and such application states that the applicants desire to
communicate with other holders of Securities of such series or with holders of
all Securities with respect to their rights under this Indenture and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Trustee shall within 5 Business Days
after the receipt of such application, at its election, either:
(1) afford such applicants access to the information preserved
at the time by the Trustee in accordance with the provisions of
subsection (a) of this Section 4.2, or
(2) inform such applicants as to the approximate number of
holders of such series or all Securities, as the case may be, whose
names and addresses appear in the information preserved at the time by
the Trustee in accordance with the provisions of subsection (a) of
this Section 4.2, and as to the approximate cost of mailing to such
Securityholders the form of proxy or other communication, if any,
specified in such application.
15
If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon the written request of such applicants,
mail to each Securityholder of such series or all Securities, as the case may
be, whose name and address appear in the information preserved at the time by
the Trustee in accordance with the provisions of subsection (a) of this Section
4.2 a copy of the form of proxy or other communication which is specified in
such request with reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender, the
Trustee shall mail to such applicants and file with the Commission, together
with a copy of the material to be mailed, a written statement to the effect
that, in the opinion of the Trustee, such mailing would be contrary to the best
interests of the holders of Securities of such series or all Securities, as the
case may be, or would be in violation of applicable law. Such written statement
shall specify the basis of such opinion. If the Commission, after opportunity
for a hearing upon the objections specified in the written statement so filed,
shall enter an order refusing to sustain any of such objections or if, after the
entry of an order sustaining one or more of such objections, the Commission
shall find, after notice and opportunity for hearing, that all the objections so
sustained have been met and shall enter an order so declaring, the Trustee shall
mail copies of such material to all such Securityholders with reasonable
promptness after the entry of such order and the renewal of such tender;
otherwise the Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.
(c) Each and every holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any paying agent shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the holders
of Securities in accordance with the provisions of subsection (b) of this
Section 4.2, regardless of the source from which such information was derived,
and that the Trustee shall not be held accountable by reason of mailing any
material pursuant to a request made under said subsection (b).
SECTION 4.3 Reports by the Company.
(a) The Company covenants and agrees to file with the Trustee, within 15
days after the date on which the Company is required to file the same with the
Commission, copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as said
Commission may from time to time by rules and regulations prescribe) which the
Company may be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Exchange Act; or, if the Company is not required to file
information, documents or reports pursuant to either of such sections, then to
file with the Trustee and the Commission, in accordance with rules and
regulations prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports which may be
required pursuant to Section 13 of the Exchange Act in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations.
(b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed from time to
time by said Commission, such additional information, documents and reports with
respect to compliance by the Company with the conditions and covenants provided
for in this Indenture as may be required from time to time by such rules and
regulations.
(c) The Company covenants and agrees to transmit by mail to all holders of
Securities, as the names and addresses of such holders appear upon the Security
Register, within 30 days after the filing thereof with the Trustee, such
summaries of any information, documents and reports required to be filed by the
Company pursuant to subsections (a) and (b) of this Section 4.3 as may be
required by rules and regulations prescribed from time to time by the
Commission.
(d) Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
16
SECTION 4.4 Reports by the Trustee.
(a) The Trustee shall transmit to Securityholders such reports
concerning the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant thereto. If required by Section 313(a) of the Trust Indenture Act, the
Trustee shall, within sixty days after each September 15 following the date of
this Indenture, commencing September 15, 2001, deliver to Securityholders a
brief report, dated as of such September 15, which complies with the provisions
of such Section 313(a).
(b) A copy of each such report shall, at the time of such transmission to
Securityholders, be filed by the Trustee with each stock exchange, if any, upon
which the Securities are listed, with the Commission and with the Company. The
Company will promptly notify the Trustee when the Securities are listed on any
stock exchange.
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT
SECTION 5.1 Events of Default.
Unless otherwise provided with respect to a series of the Securities in the
indenture supplemental hereto providing for the creation of that series, each of
the following events of default shall constitute an Event of Default with
respect to Securities of such series, as shall any other events as may be
established with respect to Securities of that series as contemplated by Section
2.2 (whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of an
administrative or governmental body):
(a) default in the payment of any interest upon any Securities of that
series or any Other Debentures when it becomes due and payable, and continuance
of such default for a period of 30 days; provided, however, that a valid
extension of an interest payment period by the Company in accordance with the
terms of any particular series of Securities established as contemplated in this
Indenture, shall not constitute a default in the payment of interest for this
purpose; or
(b) default in the payment of all or any part of the principal on any
Securities of that series or any Other Debentures as and when the same shall
become due and payable either at maturity, upon prepayment or redemption, by
declaration of acceleration of maturity or otherwise; or
(c) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty a default in
whose performance or whose breach is elsewhere in this Section specifically
dealt with and other than those set forth exclusively in the terms of (and
specifically limited to) any particular series of Securities established as
contemplated in this Indenture), and continuance of such default or breach for a
period of 90 days after there has been given, by registered or certified mail,
to the Company by the Trustee or to the Company and the Trustee by the holders
of at least 25% in aggregate principal amount of the outstanding Securities a
written notice specifying such default or breach and requiring it to be remedied
and stating that such notice is a Notice of Default hereunder; or
(d) a court having jurisdiction in the premises shall enter a decree or
order for relief in respect of the Company in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Company or for any substantial part of
its property, or ordering the winding-up or liquidation of its affairs and such
decree or order shall remain unstayed and in effect for a period of 90
consecutive days; or
(e) the Company shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, shall
consent to the entry of an order for relief in an involuntary case under any
such law, or shall consent to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian, sequestrator (or other
similar official) of the Company or of any substantial part of its property, or
17
shall make any general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due.
If an Event of Default with respect to any series of Securities at the time
outstanding occurs and is continuing, then in every such case the Trustee or the
holders of not less than 25% in aggregate principal amount of the Securities of
that series then outstanding may declare the principal amount of all Securities
of that series to be due and payable immediately, by a notice in writing to the
Company (and to the Trustee if given by the holders of the outstanding
Securities of that series), and upon any such declaration the same shall become
immediately due and payable. Notwithstanding the foregoing, if an Event of
Default specified in clause (d) or (e) of Section 5.1 occurs, the Securities of
such series then outstanding shall be due and payable immediately without
further action or notice.
The foregoing provisions, however, are subject to the condition that if, at
any time after the principal of the Securities of any series (or of all the
Securities, as the case may be) shall have been so declared due and payable, and
before any judgment or decree for the payment of the moneys due shall have been
obtained or entered as hereinafter provided, (i) the Company shall pay or shall
deposit with the Trustee a sum sufficient to pay (A) all matured installments of
interest upon all the Securities of such series (or of all the Securities, as
the case may be) and the principal of any and all Securities of such series (or
of all the Securities, as the case may be) which shall have become due otherwise
than by acceleration (with interest upon such principal and, to the extent that
payment of such interest is enforceable under applicable law, on overdue
installments of interest, at the same rate as the rate of interest specified in
the Securities of that series (or at the respective rates of interest of all the
Securities, as the case may be) to the date of such payment or deposit) and (B)
such amount as shall be sufficient to cover compensation due to the Trustee and
each predecessor Trustee, their respective agents, attorneys and counsel,
pursuant to Section 6.6, and (ii) any and all Events of Default under this
Indenture, other than the non-payment of the principal of the Securities which
shall have become due solely by such declaration of acceleration, shall have
been cured, waived or otherwise remedied as provided herein, then, in every such
case, the holders of a majority in aggregate principal amount of the Securities
of such series (or of all the Securities, as the case may be) then outstanding,
by written notice to the Company and to the Trustee, may rescind and annul such
declaration and its consequences, but no such waiver or rescission and annulment
shall extend to or shall affect any subsequent default or shall impair any right
consequent thereon; provided, however, that if the Securities of such series (or
all of the Securities, as the case may be) are held by the Property Trustee,
such waiver or rescission and annulment to such waiver shall not be effective
until the holders of a majority in aggregate liquidation amount of Trust
Securities of such Sterling Capital Trust shall have consented to such waiver or
rescission and annulment to such waiver.
In case the Trustee shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued or abandoned because
of such rescission or annulment or for any other reason or shall have been
determined adversely to the Trustee, then and in every such case the Company,
the Trustee and the holders of the Securities shall be restored respectively to
their several positions and rights hereunder, and all rights, remedies and
powers of the Company, the Trustee and the holders of the Securities shall
continue as though no such proceeding had been taken.
SECTION 5.2 Payment of Securities on Default; Suit Therefor.
The Company covenants that (a) in case default shall be made in the payment
of any installment of interest upon any of the Securities of a series as and
when the same shall become due and payable, and such default shall have
continued for a period of 30 days, or (b) in case default shall be made in the
payment of the principal of any of the Securities of a series as and when the
same shall have become due and payable, whether at maturity of the Securities of
that series or upon prepayment or redemption or by declaration or otherwise,
then, upon demand of the Trustee, the Company will pay to the Trustee, for the
benefit of the holders of the Securities of that series, the whole amount that
then shall have become due and payable on all such Securities of that series for
principal or interest with interest upon the overdue principal and (to the
extent that payment of such interest is enforceable under applicable law and, if
the Securities are held by Sterling Capital Trust or a trustee of such trust,
without duplication of any other amounts paid by the Sterling Capital Trust or a
trustee in respect thereof) upon the overdue installments of interest at the
rate borne by the Securities of that series; and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including a reasonable compensation to the Trustee, its agents,
attorneys and counsel, and any other amount due to the Trustee pursuant to
Section 6.6.
18
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor on such
Securities and collect in the manner provided by law out of the property of the
Company or any other obligor on such Securities, wherever situated, the moneys
adjudged or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy or for the
reorganization of the Company or any other obligor on the Securities under Xxxxx
00, Xxxxxx Xxxxxx Code, or any other applicable law, or in case a receiver or
trustee shall have been appointed for the property of the Company or such other
obligor, or in the case of any other similar judicial proceedings relative to
the Company or other obligor upon the Securities, or to the creditors or
property of the Company or such other obligor, the Trustee, irrespective of
whether the principal of the Securities of any series shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand pursuant to the provisions of
this Section 5.2, shall be entitled and empowered, by intervention in such
proceedings or otherwise, to file and prove a claim or claims for the whole
amount of principal and interest owing and unpaid in respect of the Securities
of such series and, in case of any judicial proceedings, to file such proofs of
claim and other papers or documents as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for amounts due to the
Trustee pursuant to 6.6) and of the Securityholders allowed in such judicial
proceedings relative to the Company or any other obligor on the Securities of
any series, or to the creditors or property of the Company or such other
obligor, unless prohibited by applicable law and regulations, to vote on behalf
of the holders of the Securities of any series in any election of a trustee or a
standby trustee in arrangement, reorganization, liquidation or other bankruptcy
or insolvency proceedings or person performing similar functions in comparable
proceedings, and to collect and receive any moneys or other property payable or
deliverable on any such claims, and to distribute the same after the deduction
of its charges and expenses; and any receiver, assignee or trustee in bankruptcy
or reorganization is hereby authorized by each of the Securityholders to make
such payments to the Trustee, and, in the event that the Trustee shall consent
to the making of such payments directly to the Securityholders, to pay to the
Trustee such amounts as shall be sufficient to cover reasonable compensation to
the Trustee, each predecessor Trustee and their respective agents, attorneys and
counsel, and all other amounts due to the Trustee pursuant to Section 6.6.
Nothing herein contained shall be construed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan of reorganization, arrangement, adjustment or composition affecting the
Securities of any series or the rights of any holder thereof or to authorize the
Trustee to vote in respect of the claim of any Securityholder in any such
proceeding.
All rights of action and of asserting claims under this Indenture, or under
any of the Securities, may be enforced by the Trustee without the possession of
any of the Securities, or the production thereof on any trial or other
proceeding relative thereto, and any such suit or proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall be for the ratable benefit of the holders of the
Securities.
In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the holders
of the Securities, and it shall not be necessary to make any holders of the
Securities parties to any such proceedings.
SECTION 5.3 Application of Moneys Collected by Trustee.
Any moneys collected by the Trustee shall be applied in the following
order, at the date or dates fixed by the Trustee for the distribution of such
moneys, upon presentation of the several Securities in respect of which moneys
have been collected, and stamping thereon the payment, if only partially paid,
and upon surrender thereof if fully paid:
First: To the payment of costs and expenses of collection applicable to
the Securities of such series and all other amounts due to the Trustee under
Section 6.6;
19
Second: To the payment of all Senior Indebtedness of the Company if and to
the extent required by Article XV;
Third: In case the principal of the outstanding Securities in respect of
which moneys have been collected shall not have become due and be unpaid, to the
payment of the amounts then due and unpaid upon Securities of such series for
principal of and interest on the Securities of such series, in respect of which
or for the benefit of which money has been collected, ratably, without
preference of priority of any kind, according to the amounts due on such
Securities for principal and interest, respectively; and
Fourth: To the Company.
SECTION 5.4 Proceedings by Securityholders.
No holder of any Security of any series shall have any right by virtue of
or by availing of any provision of this Indenture to institute any suit, action
or proceeding in equity or at law upon or under or with respect to this
Indenture or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless such holder previously shall have given to the Trustee
written notice of an Event of Default and of the continuance thereof with
respect to the Securities of such series specifying such Event of Default, as
hereinbefore provided, and unless also the holders of not less than 25% in
aggregate principal amount of the Securities of that series then outstanding
shall have made written request upon the Trustee to institute such action, suit
or proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expenses
and liabilities to be incurred therein or thereby, and the Trustee for 60 days
after its receipt of such notice, request and offer of indemnity shall have
failed to institute any such action, suit or proceeding, it being understood and
intended, and being expressly covenanted by the taker and holder of every
Security with every other taker and holder and the Trustee, that no one or more
holders of Securities of any series shall have any right in any manner whatever
by virtue of or by availing of any provision of this Indenture to affect,
disturb or prejudice the rights of any other holder of Securities, or to obtain
or seek to obtain priority over or preference to any other such holder, or to
enforce any right under this Indenture, except in the manner herein provided and
for the equal, ratable and common benefit of all holders of Securities of the
applicable series.
Notwithstanding any other provisions in this Indenture, however, the right
of any holder of any Security to receive payment of the principal of and
interest on such Security, on or after the same shall have become due and
payable, or to institute suit for the enforcement of any such payment, shall not
be impaired or affected without the consent of such holder and by accepting a
Security hereunder it is expressly understood, intended and covenanted by the
taker and holder of every Security of such series with every other such taker
and holder and the Trustee, that no one or more holders of Securities of such
series shall have any right in any manner whatsoever by virtue or by availing of
any provision of this Indenture to affect, disturb or prejudice the rights of
the holders of any other such Securities, or to obtain or seek to obtain
priority over or preference to any other such holder, or to enforce any right
under this Indenture, except in the manner herein provided and for the equal,
ratable and common benefit of all holders of Securities of such series. For the
protection and enforcement of the provisions of this Section, each and every
Securityholder and the Trustee shall be entitled to such relief as can be given
either at law or in equity.
The Company and the Trustee acknowledge that pursuant to each Declaration,
the holders of Preferred Securities are entitled, in the circumstances and
subject to the limitations set forth therein, to commence a Direct Action with
respect to any Event of Default under this Indenture and the Securities.
SECTION 5.5 Proceedings by Trustee.
In case an Event of Default occurs with respect to Securities and is
continuing, the Trustee may in its discretion proceed to protect and enforce the
rights vested in it by this Indenture by such appropriate judicial proceedings
as the Trustee shall deem most effectual to protect and enforce any of such
rights, either by suit in equity or by action at law or by proceeding in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law.
20
SECTION 5.6 Remedies Cumulative and Continuing.
All powers and remedies given by this Article V to the Trustee or to the
Securityholders shall, to the extent permitted by law, be deemed cumulative and
not exclusive of any other powers and remedies available to the Trustee or the
holders of the Securities, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this
Indenture or otherwise established with respect to the Securities of any series,
and no delay or omission of the Trustee or of any holder of any of the
Securities to exercise any right or power accruing upon any Event of Default
occurring and continuing as aforesaid shall impair any such right or power, or
shall be construed to be a waiver of any such default or an acquiescence
therein; and, subject to the provisions of Section 5.4, every power and remedy
given by this Article V or by law to the Trustee or to the Securityholders may
be exercised from time to time, and as often as shall be deemed expedient, by
the Trustee or by the Securityholders.
SECTION 5.7 Direction of Proceedings and Waiver of Defaults by
Majority of Securityholders.
The holders of a majority in aggregate principal amount of the Securities
of any or all series affected (voting as one class) at the time outstanding
shall have the right to direct the time, method, and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee; provided, however, that (subject to the
provisions of Section 6.1) the Trustee shall have the right to decline to follow
any such direction if the Trustee shall determine that the action so directed
would be unjustly prejudicial to the holders not taking part in such direction
or if the Trustee being advised by counsel determines that the action or
proceeding so directed may not lawfully be taken or if the Trustee in good faith
by its board of directors or trustees, executive committee, or a trust committee
of directors or trustees and/or Responsible Officers shall determine that the
action or proceedings so directed would involve the Trustee in personal
liability. Prior to any declaration accelerating the maturity of any series of
the Securities, the holders of a majority in aggregate principal amount of the
Securities of that series at the time outstanding may on behalf of the holders
of all of the Securities of such series waive any past default or Event of
Default and its consequences except a default (a) in the payment of principal of
or interest on any of the Securities or (b) in respect of covenants or
provisions hereof which cannot be modified or amended without the consent of the
holder of each Security affected; provided, however, that if the Securities are
held by a Sterling Capital Trust or a Property Trustee of such Trust, such
waiver or modification to such waiver shall not be effective until the holders
of a majority in aggregate liquidation amount of Trust Securities of the
applicable Sterling Capital Trust shall have consented to such waiver or
modification to such waiver; provided further, that if the consent of the holder
of each outstanding Security is required, such waiver shall not be effective
until each holder of the Trust Securities of the applicable Sterling Capital
Trust shall have consented to such waiver. Upon any such waiver, the default
covered thereby shall be deemed to be cured for all purposes of this Indenture
and the Company, the Trustee and the holders of the Securities of such series
shall be restored to their former positions and rights hereunder, respectively;
but no such waiver shall extend to any subsequent or other default or impair any
right consequent thereon. Whenever any default or Event of Default hereunder
shall have been waived as permitted by this Section 5.7, said default or Event
of Default shall for all purposes of the Securities of that series (or of all
the Securities, as the case may be) and this Indenture be deemed to have been
cured and to be not continuing.
SECTION 5.8 Notice of Defaults.
(a) The Trustee shall, within 90 days after the occurrence of a default
known to a Responsible Officer of the Trustee with respect to the Securities of
any series mail to all Securityholders of that series, as the names and
addresses of such holders appear upon the Security Register, notice of all
defaults with respect to that series actually known to a Responsible Officer of
the Trustee, unless such defaults shall have been cured before the giving of
such notice (the term defaults for the purpose of this Section 5.8 being hereby
defined to be the events specified in clauses (a), (b), (c), (d) and (e) of
Section 5.1, not including periods of grace, if any, provided for therein, and
irrespective of the giving of written notice specified in clause (c) of Section
5.1); and provided that, except in the case of default in the payment of the
principal of or interest on any of the Securities of such series, the Trustee
shall be protected in withholding such notice if and so long as a Responsible
Officer of the Trustee in good faith determines that the withholding of such
notice is in the interests of the Securityholders of such series; and provided
further, that in the case of any default of the character specified in Section
5.1(c), no such notice to Securityholders of such series shall be given until at
least 60 days after the occurrence thereof, but shall be given within 90 days
after such occurrence.
21
(b) Within five Business Days after the occurrence of any Event of Default
actually known to a Responsible Officer of the Trustee with respect to any
series the Trustee shall transmit notice of such Event of Default to all
Securityholders of such series, unless such Event of Default shall have been
cured or waived.
SECTION 5.9 Undertaking to Pay Costs.
All parties to this Indenture agree, and each holder of any Security by his
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 5.9 shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Securityholder, or group of
Securityholders of any series, holding in the aggregate more than 10% in
aggregate principal amount of the Securities of that series outstanding, or to
any suit instituted by any Securityholder for the enforcement of the payment of
the principal of or interest on any Security against the Company on or after the
same shall have become due and payable.
SECTION 5.10 Requirement to Post Bond. Notwithstanding anything
contained herein to the contrary, the Trustee shall not be bound, obligated or
required to take any action at the request or direction of any Securityholder
pursuant to this Indenture if such Securityholder shall not have made available
to the Trustee, security or indemnity reasonably acceptable to the Trustee
against costs, expenses and liabilities (including fees and expenses of its
agents and counsel) which might be incurred by it in compliance with the written
request or direction.
ARTICLE VI
CONCERNING THE TRUSTEE
SECTION 6.1 Duties and Responsibilities of Trustee.
With respect to the holders of any series of Securities issued hereunder,
the Trustee, prior to the occurrence of an Event of Default with respect to
Securities of that series of which a Responsible Officer of the Trustee has
actual knowledge and after the curing or waiving of all Events of Default which
may have occurred with respect to Securities of that series, undertakes to
perform such duties and only such duties as are specifically set forth in this
Indenture. In case an Event of Default with respect to Securities of a series
has occurred (which has not been cured or waived), the Trustee shall exercise
such of the rights and powers vested in it by this Indenture, and use the same
degree of care and skill in their exercise, as a prudent person would exercise
or use under the circumstances in the conduct of his or her own affairs.
No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default with respect to
Securities of a series and after the curing or waiving of all Events of Default
which may have occurred,
(1) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Indenture, and the
Trustee shall not be liable except for the performance of such duties
and obligations with respect to such series as are specifically set
forth in this Indenture, and no implied covenants or obligations shall
be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee and conforming to
the requirements of this
22
Indenture; but, in the case of any such certificates or opinions which
by any provision hereof are specifically required to be furnished to
the Trustee, the Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Indenture;
(b) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer or Responsible Officers, unless it shall be
proved that the Trustee was negligent in ascertaining the pertinent facts; and
(c) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the
Securityholders pursuant to Section 5.7, relating to the time, method and place
of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Indenture.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or liability is not reasonably assured to it under the
terms of this Indenture or adequate indemnity against such risk is not
reasonably assured to it.
SECTION 6.2 Reliance on Documents, Opinions, etc.
Except as otherwise provided in :
(a) the Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, bond, note,
debenture or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Company mentioned
herein may be sufficiently evidenced by an Officers' Certificate (unless other
evidence in respect thereof be herein specifically prescribed); and any Board
Resolution may be evidenced to the Trustee by a copy thereof certified by the
Secretary or an Assistant Secretary of the Company;
(c) the Trustee may consult with counsel of its selection and any advice
or Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders, pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable and sufficient security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or omitted by
it in good faith and believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Indenture; nothing contained herein
shall, however, relieve the Trustee of the obligation, upon the occurrence of an
Event of Default with respect to a series of Securities of which a Responsible
Officer of the Trustee has actual knowledge (that has not been cured or waived),
to exercise with respect to Securities of that series such of the rights and
powers vested in it by this Indenture, and to use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, debenture,
coupon or other paper or document, unless requested in writing to do so by the
holders of a majority in aggregate principal amount of the outstanding
Securities of the series affected thereby; provided, however, that if the
payment within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the
23
making of such investigation is, in the opinion of the Trustee, not reasonably
assured to the Trustee by the security afforded to it by the terms of this
Indenture, the Trustee may require reasonable indemnity against such expense or
liability as a condition to so proceeding;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents (including
any Authenticating Agent) or attorneys, and the Trustee shall not be responsible
for any misconduct or negligence on the part of any such agent or attorney
appointed by it with due care; and
(h) the Trustee shall not be charged with knowledge of any Default or
Event of Default with respect to the Securities of any series unless (1) such
default is a default under Section 5.1(a) and Section 5.1(b) of the Indenture,
(2) a Responsible Officer shall have actual knowledge of such Default or Event
of Default or (3) written notice of such Default or Event of Default shall have
been given to the Trustee by the Company or any other obligor on the Securities
of such series or by any holder of the Securities of that series.
SECTION 6.3 No Responsibility for Recitals, etc.
The recitals contained herein and in the Securities (except in the
certificate of authentication of the Trustee or the Authenticating Agent) shall
be taken as the statements of the Company, and the Trustee and the
Authenticating Agent assume no responsibility for the correctness of the same.
The Trustee and the Authenticating Agent make no representations as to the
validity or sufficiency of this Indenture or of the Securities. The Trustee and
the Authenticating Agent shall not be accountable for the use or application by
the Company of any Securities or the proceeds of any Securities authenticated
and delivered by the Trustee or the Authenticating Agent in conformity with the
provisions of this Indenture.
SECTION 6.4 Trustee, Authenticating Agent, Paying Agents, Transfer
Agents or Registrar May Own Securities.
The Trustee or any Authenticating Agent or any paying agent or any transfer
agent or any Security registrar, in its individual or any other capacity, may
become the owner or pledgee of Securities with the same rights it would have if
it were not Trustee, Authenticating Agent, paying agent, transfer agent or
Security registrar.
SECTION 6.5 Moneys to be Held in Trust.
Subject to the provisions of Section 11.4, all moneys received by the
Trustee or any paying agent shall, until used or applied as herein provided, be
held in trust for the purpose for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee
and any paying agent shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the Company.
So long as no Event of Default shall have occurred and be continuing, all
interest allowed on any such moneys shall be paid from time to time upon the
written order of the Company, signed by the Chairman of the Board of Directors,
the President or a Vice President or the Treasurer or an Assistant Treasurer of
the Company.
SECTION 6.6 Compensation and Expenses of Trustee.
The Company, as issuer of Securities under this Indenture, covenants and
agrees to pay to the Trustee from time to time, and the Trustee shall be
entitled to, such compensation as shall be agreed to in writing between the
Company and the Trustee (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust), and the Company
will pay or reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any of the provisions of this Indenture (including the reasonable compensation
and the expenses and disbursements of its counsel and of all persons not
regularly in its employ) except any such expense, disbursement or advance as may
arise from its negligence or bad faith. The Company also covenants to indemnify
each of the Trustee or any predecessor Trustee (and its officers, agents,
directors and employees) for, and to hold it harmless against, any and all loss,
damage, claim, liability or expense including taxes (other than taxes based on
the income of the Trustee) incurred without negligence or bad faith on the part
of the Trustee and arising out of or in connection with the acceptance or
24
administration of this trust, including the costs and expenses of defending
itself against any claim of liability in the premises. The obligations of the
Company under this Section 6.6 to compensate and indemnify the Trustee and to
pay or reimburse the Trustee for expenses, disbursements and advances shall
constitute additional indebtedness hereunder. Such additional indebtedness
shall be secured by a lien prior to that of the Securities upon all property and
funds held or collected by the Trustee as such, except funds held in trust for
the benefit of the holders of particular Securities.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 5.1(d) or Section 5.1(e), the expenses
(including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
The provisions of this Section shall survive the resignation or removal of
the Trustee and the defeasance or other termination of this Indenture.
SECTION 6.7 Officers' Certificate as Evidence.
Except as otherwise provided in Section 6.1 and Section 6.2, whenever in
the administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
omitting any action hereunder, such matter (unless other evidence in respect
thereof is herein specifically prescribed) may, in the absence of negligence or
bad faith on the part of the Trustee, be deemed to be conclusively proved and
established by an Officers' Certificate delivered to the Trustee, and such
certificate, in the absence of negligence or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action taken or omitted by
it under the provisions of this Indenture upon the faith thereof.
SECTION 6.8 Conflicting Interest of Trustee.
If the Trustee has or shall acquire any "conflicting interest" within the
meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the
Company shall in all respects comply with the provisions of Section 310(b) of
the Trust Indenture Act.
SECTION 6.9 Eligibility of Trustee.
The Trustee hereunder shall at all times be a corporation organized and
doing business under the laws of the United States of America or any state or
territory thereof or of the District of Columbia, or a corporation or other
Person permitted to act as trustee by the Commission authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least 50 million U.S. dollars ($50,000,000) and subject to supervision or
examination by Federal, state, territorial, or District of Columbia authority.
If such corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section 6.9 the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
The Company may not, nor may any Person directly or indirectly controlling,
controlled by, or under common control with the Company, serve as Trustee.
In case at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section 6.9, the Trustee shall resign immediately in
the manner and with the effect specified in Section 6.10.
SECTION 6.10 Resignation or Removal of Trustee.
(a) The Trustee, or any trustee or trustees hereafter appointed, may at
any time resign with respect to one or more or all series of Securities by
giving written notice of such resignation to the Company and by mailing notice
thereof to the holders of the applicable series of Securities at their addresses
as they shall appear on the Security Register. Upon receiving such notice of
resignation, the Company shall promptly appoint a successor trustee or trustees
by written instrument, in duplicate, one copy of which instrument shall be
delivered to the
25
resigning Trustee and one copy to the successor trustee. If no successor trustee
shall have been so appointed with respect to any series of Securities and have
accepted appointment within 60 days after the mailing of such notice of
resignation to the affected Securityholders, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a successor trustee,
or any Securityholder who has been a bona fide holder of a Security or
Securities of the applicable series for at least six months may, subject to the
provisions of Section 5.9, on behalf of himself and all others similarly
situated, petition any such court for the appointment of a successor trustee.
Such court may thereupon, after such notice, if any, as it may deem proper and
prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with the provisions of
Section 6.8 after written request therefor by the Company or by any
Securityholder who has been a bona fide holder of a Security or
Securities for at least six months, or
(2) the Trustee shall cease to be eligible in accordance with
the provisions of Section 6.9 and shall fail to resign after written
request therefor by the Company or by any such Securityholder, or
(3) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation,
then, in any such case, the Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to the
successor trustee, or, subject to the provisions of Section 5.9, any
Securityholder who has been a bona fide holder of a Security or Securities of
the applicable series for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor trustee. Such court
may thereupon, after such notice, if any, as it may deem proper and prescribe,
remove the Trustee and appoint a successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Securities of any series at the time outstanding may at any time remove the
Trustee with respect to such series and nominate a successor trustee with
respect to the applicable series of Securities or all series, as the case may
be, which shall be deemed appointed as successor trustee with respect to the
applicable series unless within 10 days after such nomination the Company
objects thereto, or if no successor trustee shall have been so appointed and
shall have accepted appointment within 30 days after such removal, in which case
the Trustee so removed or any Securityholder of the applicable series, upon the
terms and conditions and otherwise as in subsection(a) of this Section 6.10
provided, may petition any court of competent jurisdiction for an appointment of
a successor trustee with respect to such series.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section 6.10 shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 6.11.
(e) The Company shall pay the Trustee all amounts owed to such Trustee
pursuant to this Indenture upon the resignation or removal of the Trustee.
SECTION 6.11 Acceptance by Successor Trustee.
Any successor trustee appointed as provided in Section 6.10 shall execute,
acknowledge and deliver to the Company and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the retiring trustee with respect to all or any applicable series
shall become effective and such successor trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, duties and
obligations with respect to such series of its predecessor hereunder, with like
effect as if originally named as trustee herein; but, nevertheless, on the
written request of the Company or of the successor trustee, the trustee
26
ceasing to act shall, upon payment of any amounts then due it pursuant to the
provisions of Section 6.6, execute and deliver an instrument transferring to
such successor trustee all the rights and powers of the trustee so ceasing to
act and shall duly assign, transfer and deliver to such successor trustee all
property and money held by such retiring trustee thereunder. Upon request of any
such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor
trustee all such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a lien upon all property or funds held or collected by such
trustee to secure any amounts then due it pursuant to the provisions of Section
6.6.
If a successor trustee is appointed with respect to the Securities of one
or more (but not all) series, the Company, the retiring trustee and each
successor trustee with respect to the Securities of any applicable series shall
execute and deliver an indenture supplemental hereto which shall contain such
provisions as shall be deemed necessary or desirable to confirm that all the
rights, powers, trusts and duties of the retiring trustee with respect to the
Securities of any series as to which the predecessor trustee is not retiring
shall continue to be vested in the predecessor trustee, and shall add to or
change any of the provisions of this Indenture as shall be necessary to provide
for or facilitate the administration of the trustee hereunder by more than one
trustee, it being understood that nothing herein or in such supplemental
indenture shall constitute such trustees co-trustees of the same trust and that
each such trustee shall be trustee of a trust or trusts hereunder separate and
apart from any trust or trusts hereunder administered by any other such trustee.
No successor trustee shall accept appointment as provided in this Section
6.11 unless at the time of such acceptance such successor trustee shall be
qualified under the provisions of Section 6.8 and eligible under the provisions
of Section 6.9.
Upon acceptance of appointment by a successor trustee as provided in this
Section 6.11, the Company shall mail notice of the succession of such trustee
hereunder to the holders of Securities of any applicable series at their
addresses as they shall appear on the Security Register. If the Company fails
to mail such notice within 10 days after the acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed at
the expense of the Company. No Trustee shall have any liability for any actions
taken or omitted to be taken by any successor trustee.
SECTION 6.12 Succession by Merger, etc.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder without
the execution or filing of any paper or any further act on the part of any of
the parties hereto.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any Securities of any series shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor trustee, and deliver such
Securities so authenticated; and in case at that time any of the Securities of
any series shall not have been authenticated, any successor to the Trustee may
authenticate such Securities either in the name of any predecessor hereunder or
in the name of the successor trustee; and in all such cases such certificates
shall have the full force which the Securities of that series or this Indenture
elsewhere provides that the certificate of the Trustee shall have; provided,
however, that the right to adopt the certificate of authentication of any
predecessor Trustee or authenticate Securities of any series in the name of any
predecessor Trustee shall apply only to its successor or successors by merger,
conversion or consolidation.
SECTION 6.13 Limitation on Rights of Trustee as a Creditor.
The Trustee shall comply with Section 311(a) of the Trust Indenture Act,
excluding any creditor relationship described in Section 311(b) of the Trust
Indenture Act. A Trustee who has resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent included therein.
27
SECTION 6.14 Authenticating Agents
There may be one or more Authenticating Agents appointed by the Trustee
upon the request of the Company with power to act on its behalf and subject to
its direction in the authentication and delivery of Securities of any series
issued upon exchange or transfer thereof as fully to all intents and purposes as
though any such Authenticating Agent had been expressly authorized to
authenticate and deliver Securities of such series; provided, that the Trustee
shall have no liability to the Company for any acts or omissions of the
Authenticating Agent with respect to the authentication and delivery of
Securities of any series. Any such Authenticating Agent shall at all times be a
corporation organized and doing business under the laws of the United States or
of any state or territory thereof or of the District of Columbia authorized
under such laws to act as Authenticating Agent, having a combined capital and
surplus of at least $50,000,000 and being subject to supervision or examination
by Federal, state, territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually pursuant to law or
the requirements of such authority, then for the purposes of this Section 6.14
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time an Authenticating Agent shall cease to be eligible
in accordance with the provisions of this Section, it shall resign immediately
in the manner and with the effect herein specified in this Section.
Any corporation into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authenticating Agent
shall be a party, or any corporation succeeding to the corporate trust business
of any Authenticating Agent, shall be the successor of such Authenticating Agent
hereunder, if such successor corporation is otherwise eligible under this
Section 6.14 without the execution or filing of any paper or any further act on
the part of the parties hereto or such Authenticating Agent.
Any Authenticating Agent may at any time resign with respect to one or more
or all series of Securities by giving written notice of resignation to the
Trustee and to the Company. The Trustee may at any time terminate the agency of
any Authenticating Agent with respect to one or more or all series of Securities
by giving written notice of termination to such Authenticating Agent and to the
Company. Upon receiving such a notice of resignation or upon such a
termination, or in case at any time any Authenticating Agent shall cease to be
eligible under this Section 6.14, the Trustee may, and upon the request of the
Company shall, promptly appoint a successor Authenticating Agent with respect to
the applicable series eligible under this Section 6.14, shall give written
notice of such appointment to the Company and shall mail notice of such
appointment to all holders of the applicable series of Securities as the names
and addresses of such holders appear on the Security Register. Any successor
Authenticating Agent with respect to all or any series upon acceptance of its
appointment hereunder shall become vested with all rights, powers, duties and
responsibilities with respect to such series of its predecessor hereunder, with
like effect as if originally named as Authenticating Agent herein.
The Company, as borrower, agrees to pay to any Authenticating Agent from
time to time reasonable compensation for its services. Any Authenticating Agent
shall have no responsibility or liability for any action taken by it as such in
accordance with the directions of the Trustee.
ARTICLE VII
CONCERNING THE SECURITYHOLDERS
SECTION 7.1 Action by Securityholders.
Whenever in this Indenture it is provided that the holders of a specified
percentage in aggregate principal amount of the Securities of any or all series
may take any action (including the making of any demand or request, the giving
of any notice, consent or waiver or the taking of any other action), the fact
that at the time of taking any such action the holders of such specified
percentage have joined therein may be evidenced (a) by any instrument or any
number of instruments of similar tenor executed by such Securityholders in
person or by agent or proxy appointed in writing, or (b) by the record of such
holders of Securities voting in favor thereof at any meeting of such
28
Securityholders duly called and held in accordance with the provisions of
Article VIII, or (c) by a combination of such instrument or instruments and any
such record of such a meeting of such Securityholders.
If the Company shall solicit from the Securityholders of any series any
request, demand, authorization, direction, notice, consent, waiver or other
action, the Company may, at its option, as evidenced by an Officers'
Certificate, fix in advance a record date for such series for the determination
of Securityholders entitled to give such request, demand, authorization,
direction, notice, consent, waiver or other action, but the Company shall have
no obligation to do so. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent, waiver or other action may be given
before or after the record date, but only the Securityholders of record at the
close of business on the record date shall be deemed to be Securityholders for
the purposes of determining whether Securityholders of the requisite proportion
of outstanding Securities of that series have authorized or agreed or consented
to such request, demand, authorization, direction, notice, consent, waiver or
other action, and for that purpose the outstanding Securities of that series
shall be computed as of the record date; provided, however, that no such
authorization, agreement or consent by such Securityholders on the record date
shall be deemed effective unless it shall become effective pursuant to the
provisions of this Indenture not later than six months after the record date.
SECTION 7.2 Proof of Execution by Securityholders.
Subject to the provisions of Section 6.1, Section 6.2, and Section 8.5,
proof of the execution of any instrument by a Securityholder or his agent or
proxy shall be sufficient if made in accordance with such reasonable rules and
regulations as may be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee. The ownership of Securities shall be proved by the
Security Register or by a certificate of the Security registrar. The Trustee
may require such additional proof of any matter referred to in this Section as
it shall deem necessary.
The record of any Securityholders' meeting shall be proved in the manner
provided in Section 8.6.
SECTION 7.3 Who Are Deemed Absolute Owners.
Prior to due presentment for registration of transfer of any Security, the
Company, the Trustee, any Authenticating Agent, any paying agent, any transfer
agent and any Security registrar may deem the person in whose name such Security
shall be registered upon the Security Register to be, and may treat him as, the
absolute owner of such Security (whether or not such Security shall be overdue)
for the purpose of receiving payment of or on account of the principal of and
interest on such Security and for all other purposes; and neither the Company
nor the Trustee nor any Authenticating Agent nor any paying agent nor any
transfer agent nor any Security registrar shall be affected by any notice to the
contrary. All such payments so made to any holder for the time being or upon
his order shall be valid, and, to the extent of the sum or sums so paid,
effectual to satisfy and discharge the liability for moneys payable upon any
such Security.
SECTION 7.4 Securities Owned by Company Deemed Not Outstanding.
In determining whether the holders of the requisite aggregate principal
amount of Securities have concurred in any direction, consent or waiver under
this Indenture, Securities which are owned by the Company or any other obligor
on the Securities or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or any
other obligor on the Securities shall be disregarded and deemed not to be
outstanding for the purpose of any such determination; provided that for the
purposes of determining whether the Trustee shall be protected in relying on any
such direction, consent or waiver, only Securities which a Responsible Officer
of the Trustee actually knows are so owned shall be so disregarded. Securities
so owned which have been pledged in good faith may be regarded as outstanding
for the purposes of this Section 7.4 if the pledgee shall establish to the
satisfaction of the Trustee the pledgee's right to vote such Securities and that
the pledgee is not the Company or any such other obligor or Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company or any such other obligor. In the case of a dispute as
to such right, any decision by the Trustee taken upon the advice of counsel
shall be full protection to the Trustee.
29
SECTION 7.5 Revocation of Consents; Future Holders Bound.
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 7.1, of the taking of any action by the holders of the
percentage in aggregate principal amount of the Security specified in this
Indenture in connection with such action, any holder of a Security (or any
Security issued in whole or in part in exchange or substitution therefor),
subject to Section 7.1, the serial number of which is shown by the evidence to
be included in the group of Securities the holders of which have consented to
such action may, by filing written notice with the Trustee at its principal
office and upon proof of holding as provided in Section 7.2, revoke such action
so far as concerns such Security (or so far as concerns the principal amount
represented by any exchanged or substituted Security). Except as aforesaid any
such action taken by the holder of any Security shall be conclusive and binding
upon such holder and upon all future holders and owners of such Security, and of
any Security issued in exchange or substitution therefor, irrespective of
whether or not any notation in regard thereto is made upon such Security or any
Security issued in exchange or substitution therefor.
ARTICLE VIII
SECURITYHOLDERS' MEETINGS
SECTION 8.1 Purposes of Meetings.
A meeting of Securityholders of any or all series may be called at any time
and from time to time pursuant to the provisions of this Article VIII for any of
the following purposes:
(a) to give any notice to the Company or to the Trustee, or to give any
directions to the Trustee, or to consent to the waiving of any default hereunder
and its consequences, or to take any other action authorized to be taken by
Securityholders pursuant to any of the provisions of Article V;
(b) to remove the Trustee and nominate a successor trustee pursuant to the
provisions of Article VI;
(c) to consent to the execution of an indenture or indentures supplemental
hereto pursuant to the provisions of Section 9.2; or
(d) to take any other action authorized to be taken by or on behalf of the
holders of any specified aggregate principal amount of such Securities under any
other provision of this Indenture or under applicable law.
SECTION 8.2 Call of Meetings by Trustee.
The Trustee may at any time call a meeting of Securityholders of any or all
series to take any action specified in Section 8.1, to be held at such time and
at such place in the Borough of Manhattan, The City of New York, as the Trustee
shall determine. Notice of every meeting of the Securityholders of any or all
series, setting forth the time and the place of such meeting and in general
terms the action proposed to be taken at such meeting, shall be mailed to
holders of Securities of each series affected at their addresses as they shall
appear on the Securities Register. Such notice shall be mailed not less than 20
nor more than 180 days prior to the date fixed for the meeting.
SECTION 8.3 Call of Meetings by Company or Securityholders.
In case at any time the Company, pursuant to a resolution of the Board of
Directors, or the holders of at least 10% in aggregate principal amount of the
Securities of any or all series, as the case may be, then outstanding, shall
have requested the Trustee to call a meeting of Securityholders of any or all
series, as the case may be, by written request setting forth in reasonable
detail the action proposed to be taken at the meeting, and the Trustee shall not
have mailed the notice of such meeting within 20 days after receipt of such
request, then the Company or such Securityholders may determine the time and the
place in said Borough of Manhattan for such meeting and may call such meeting to
take any action authorized in Section 8.1, by mailing notice thereof as provided
in Section 8.2.
30
SECTION 8.4 Qualifications for Voting.
To be entitled to vote at any meeting of Securityholders a Person shall (a)
be a holder of one or more Securities with respect to which the meeting is being
held or (b) a Person appointed by an instrument in writing as proxy by a holder
of one or more such Securities. The only Persons who shall be entitled to be
present or to speak at any meeting of Securityholders shall be the Persons
entitled to vote at such meeting and their counsel and any representatives of
the Trustee and its counsel and any representatives of the Company and its
counsel.
SECTION 8.5 Regulations
Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Securityholders, in regard to proof of the holding of Securities and of the
appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and
other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall think fit.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in Section 8.3, in which case the
Company or the Securityholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by majority vote of the meeting.
Subject to the provisions of Section 8.4, at any meeting each holder of
Securities with respect to which such meeting is being held or proxy therefor
shall be entitled to one vote for each $25 principal amount of Securities held
or represented by him; provided, however, that no vote shall be cast or counted
at any meeting in respect of any Security challenged as not outstanding and
ruled by the chairman of the meeting to be not outstanding. The chairman of the
meeting shall have no right to vote other than by virtue of Securities held by
him or instruments in writing as aforesaid duly designating him as the person to
vote on behalf of other Securityholders. Any meeting of Securityholders duly
called pursuant to the provisions of Section 8.2 or Section 8.3 may be adjourned
from time to time by a majority of those present in person and by proxy, and the
meeting may be held as so adjourned without further notice.
SECTION 8.6 Voting.
The vote upon any resolution submitted to any meeting of holders of
Securities with respect to which such meeting is being held shall be by written
ballots on which shall be subscribed the signatures of such holders or of their
representatives by proxy and the serial number or numbers of the Securities held
or represented by them. The permanent chairman of the meeting shall appoint two
inspectors of votes who shall count all votes cast at the meeting for or against
any resolution and who shall make and file with the secretary of the meeting
their verified written reports in triplicate of all votes cast at the meeting.
A record in duplicate of the proceedings of each meeting of Securityholders
shall be prepared by the secretary of the meeting and there shall be attached to
said record the original reports of the inspectors of votes on any vote by
ballot taken thereat and affidavits by one or more persons having knowledge of
the facts setting forth a copy of the notice of the meeting and showing that
said notice was mailed as provided in Section 8.2. The record shall show the
serial numbers of the Securities voting in favor of or against any resolution.
The record shall be signed and verified by the affidavits of the permanent
chairman and secretary of the meeting and one of the duplicates shall be
delivered to the Company and the other to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
31
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures without Consent of Securityholders.
The Company and the Trustee may from time to time and at any time enter
into an indenture or indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as then in effect), without the consent of
the Securityholders, for one or more of the following purposes:
(a) to evidence the succession of another corporation to the Company, or
successive successions, and the assumption by the successor corporation of the
covenants, agreements and obligations of the Company pursuant to Article X
hereof;
(b) to add to the covenants of the Company such further covenants,
restrictions or conditions for the protection of the holders of all or any
series of Securities (and if such covenants are to be for the benefit of less
than all series of Securities stating that such covenants are expressly being
included for the benefit of such series) as the Board of Directors and the
Trustee shall consider to be for the protection of the holders of such
Securities, and to make the occurrence, or the occurrence and continuance, of a
default in any of such additional covenants, restrictions or conditions a
default or an Event of Default permitting the enforcement of all or any of the
several remedies provided in this Indenture as herein set forth; provided,
however, that in respect of any such additional covenant, restriction or
condition such supplemental indenture may provide for a particular period of
grace after default (which period may be shorter or longer than that allowed in
the case of other defaults) or may provide for an immediate enforcement upon
such default or may limit the remedies available to the Trustee upon such
default;
(c) to provide for the issuance under this Indenture of Securities in
coupon form (including Securities registrable as to principal only) and to
provide for exchangeability of such Securities with the Securities issued
hereunder in fully registered form and to make all appropriate changes for such
purpose;
(d) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provision contained herein or in any supplemental
indenture, or to make such other provisions in regard to matters or questions
arising under this Indenture; provided that any such action shall not adversely
affect the interests of the holders of the Securities;
(e) to evidence and provide for the acceptance of appointment hereunder by
a successor trustee with respect to the Securities of one or more series and to
add to or change any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the Trusts hereunder by more
than one trustee, pursuant to the requirements of Section 6.11;
(f) to make any change that does not adversely affect the rights of any
Securityholder in any material respect; or
(g) to provide for the issuance of and establish the form and terms and
conditions of the Securities of any series as permitted by Sections 2.1 and 2.2,
to establish the form of any certifications required to be furnished pursuant to
the terms of this Indenture or any series of Securities, or to add to the rights
of the holders of any series of Securities.
The Trustee is hereby authorized to join with the Company in the execution
of any such supplemental indenture, to make any further appropriate agreements
and stipulations which may be therein contained and to accept the conveyance,
transfer and assignment of any property thereunder, but the Trustee shall not be
obligated to, but may in its discretion, enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
32
Any supplemental indenture authorized by the provisions of this Section 9.1
may be executed by the Company and the Trustee without the consent of the
holders of any of the Securities at the time outstanding, notwithstanding any of
the provisions of Section 9.2.
SECTION 9.2 Supplemental Indentures with Consent of Securityholders.
With the consent (evidenced as provided in Section 7.1) of the holders of
not less than a majority in aggregate principal amount of the Securities at the
time outstanding of all series affected by such supplemental indenture (voting
as a class), and in the case of Securities issued to a Sterling Capital Trust,
the holders of a majority in aggregate liquidation amount of the related
Preferred Securities, the Company, when authorized by a Board Resolution, and
the Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act then in effect) for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this Indenture
or of any supplemental indenture or of modifying in any manner the rights of the
holders of the Securities of each series so affected; provided, however, that no
such supplemental indenture shall, without the consent of the holders of each
Security affected thereby (and each Preferred Security, if applicable), (i)
extend or change the fixed maturity of any Security of any series (except as may
otherwise be provided by the terms of any supplemental indenture establishing
such series in accordance with Section 2.2 hereof), or reduce the rate of
interest thereon or extend the time of payment of interest thereon (except as
may otherwise be provided by the terms of any supplemental indenture
establishing such series in accordance with Section 2.2 hereof), or reduce the
principal amount thereof or any premium thereon, or reduce any amount payable on
redemption thereof or make the principal thereof or any interest or premium
thereon payable in any coin or currency other than that provided in the
Securities, or impair or affect the right of any Securityholder to institute
suit for payment thereof or the right of repayment, if any, at the option of the
holder, without the consent of the holder of each Security so affected, (ii)
reduce the aforesaid percentage of Securities the holders of which are required
to consent to any such supplemental indenture or (iii) otherwise materially
adversely affect the interest of the holders of any series of the Securities or
the Preferred Securities; provided, further, that if the Securities of such
series are held by a Sterling Capital Trust or a trustee of such trust, such
supplemental indenture shall not be effective until the holders of a majority in
liquidation preference of Trust Securities of the applicable Trust shall have
consented to such supplemental indenture; provided further, that if the consent
of the holder of each outstanding Security is required, such supplemental
indenture shall not be effective until each holder of the Trust Securities of
the applicable Sterling Capital Trust shall have consented to such supplemental
indenture.
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of Securityholders of such series with respect to such covenant or
provision, shall be deemed not to affect the rights under this Indenture or the
Securityholders of any other series.
Upon the request of the Company accompanied by a copy of a resolution of
the Board of Directors certified by its Secretary or Assistant Secretary
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of Securityholders as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such supplemental indenture. The Trustee may receive an Opinion of Counsel
as conclusive evidence that any supplemental indenture executed pursuant to this
Article is authorized or permitted by, and conforms to, the terms of this
Article and that it is proper for the Trustee under the provisions of this
Article to join in the execution thereof.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Trustee
shall transmit by mail, first class postage prepaid, a notice, setting forth in
general terms the substance of such supplemental indenture, to the
Securityholders of all series affected thereby as their names and addresses
appear upon the Security Register. Any failure of the Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
33
It shall not be necessary for the consent of the Securityholders under this
Section 9.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
SECTION 9.3 Compliance with Trust Indenture Act; Effect of Supplemental
Indentures.
Any supplemental indenture executed pursuant to the provisions of this
Article IX shall comply with the Trust Indenture Act, as then in effect. Upon
the execution of any supplemental indenture pursuant to the provisions of this
Article IX, this Indenture shall be and be deemed to be modified and amended in
accordance therewith and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of the Trustee, the
Company and the holders of Securities of each series affected thereby shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 9.4 Notation on Securities.
Securities of any series authenticated and delivered after the execution of
any supplemental indenture affecting such series pursuant to the provisions of
this ARTICLE IX may bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental indenture. If the Company or the
Trustee shall so determine, new Securities of any series so modified as to
conform, in the opinion of the Trustee and the Board of Directors, to any
modification of this Indenture contained in any such supplemental indenture
maybe prepared and executed by the Company, authenticated by the Trustee or the
Authenticating Agent and delivered in exchange for the Securities of any series
then outstanding.
SECTION 9.5 Evidence of Compliance of Supplemental Indenture to be
Furnished Trustee.
The Trustee, subject to the provisions of Section 6.1 and Section 6.2, may
receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any supplemental indenture executed pursuant hereto complies with
the requirements of this ARTICLE IX.
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 10.1 Company May Consolidate, etc., on Certain Terms.
Nothing contained in this Indenture or in any of the Securities shall
prevent any consolidation or merger of the Company with or into any other Person
(whether or not affiliated with the Company, as the case may be), or successive
consolidations or mergers in which the Company or its successor or successors,
as the case may be, shall be a party or parties, or shall prevent any sale,
conveyance, transfer or lease of the property of the Company, or its successor
or successors as the case may be, as an entirety, or substantially as an
entirety, to any other Person (whether or not affiliated with the Company, or
its successor or successors, as the case may be) authorized to acquire and
operate the same; provided, that (a) the Company is the surviving Person, or the
Person formed by or surviving any such consolidation or merger (if other than
the Company) or to which such sale, conveyance, transfer or lease of property is
made is a Person organized and existing under the laws of the United States or
any State thereof or the District of Columbia and is the ultimate parent entity
of the organization with which the Company is engaging in such transaction, and
(b) upon any such consolidation, merger, sale, conveyance, transfer or lease,
the due and punctual payment of the principal of and interest on all of the
Securities of all series in accordance with the terms of each series, according
to their tenor and the due and punctual performance and observance of all the
covenants and conditions of this Indenture with respect to each series or
established with respect to such series to be kept or performed by the Company
shall be expressly assumed, by supplemental indenture (which shall conform to
the provisions of the Trust Indenture Act) satisfactory in form to the Trustee
executed and delivered to the Trustee by the Person formed by such
consolidation, or into which the Company shall have been merged (or its ultimate
parent
34
entity), or by the Person which shall have acquired such property, as the
case may be, and (c) after giving effect to such consolidation, merger, sale,
conveyance, transfer or lease, no Default or Event of Default shall have
occurred and be continuing.
SECTION 10.2 Successor Corporation to be Substituted for Company.
In case of any such consolidation, merger, conveyance or transfer and upon
the assumption by the successor corporation, by supplemental indenture, executed
and delivered to the Trustee and satisfactory in form to the Trustee, of the
obligation of due and punctual payment of the principal of and interest on all
of the Securities and the due and punctual performance and observance of all of
the covenants and conditions of this Indenture to be performed or observed by
the Company, such successor Person shall succeed to and be substituted for the
Company, with the same effect as if it had been named herein as the party of the
first part, and the Company thereupon shall be relieved of any further liability
or obligation hereunder or upon the Securities. Such successor Person thereupon
may cause to be signed, and may issue either in its own name or in the name of
Sterling Capital Trust, any or all of the Securities issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Trustee or the Authenticating Agent; and, upon the order of such successor
Person instead of the Company and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee or the Authenticating
Agent shall authenticate and deliver any Securities which previously shall have
been signed and delivered by the officers of the Company to the Trustee or the
Authenticating Agent for authentication, and any Securities which such successor
Person thereafter shall cause to be signed and delivered to the Trustee or the
Authenticating Agent for that purpose. All the Securities so issued shall in
all respects have the same legal rank and benefit under this Indenture as the
Securities theretofore or thereafter issued in accordance with the terms of this
Indenture as though all of such Indentures had been issued at the date of the
execution hereof.
SECTION 10.3 Opinion of Counsel to be Given Trustee.
The Trustee, subject to the provisions of Section 6.1 and Section 6.2 may
receive an Opinion of Counsel as conclusive evidence that any consolidation,
merger, sale, conveyance, transfer or lease, and any assumption, permitted or
required by the terms of this Article X complies with the provisions of this
Article X.
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.1 Discharge of Indenture.
When (a) the Company shall deliver to the Trustee for cancellation all
Securities theretofore authenticated (other than any Securities which shall have
been destroyed, lost or stolen and which shall have been replaced as provided in
Section 2.7) and not theretofore cancelled, or (b) all the Securities not
theretofore cancelled or delivered to the Trustee for cancellation shall have
become due and payable, or are by their terms to become due and payable within
one year or are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption, and the
Company shall deposit with the Trustee, in trust, funds sufficient to pay at
maturity or upon prepayment all of the Securities (other than any Securities
which shall have been destroyed, lost or stolen and which shall have been
replaced as provided in Section 2.7) not theretofore cancelled or delivered to
the Trustee for cancellation, including principal (and premium, if any) and
interest due or to become due to such date of maturity or redemption date, as
the case may be, but excluding, however, the amount of any moneys for the
payment of principal of or interest on the Securities (1) theretofore repaid to
the Company in accordance with the provisions of Section 11.4, or (2) paid to
any State or to the District of Columbia pursuant to its unclaimed property or
similar laws, and if in either case the Company shall also pay or cause to be
paid all other sums payable hereunder by the Company, then this Indenture shall
cease to be of further effect except for the provisions of this Section 11.1 and
Sections 2.3, 2.6, 2.7, 3.1, 3.2, 3.4, 6.6, 6.10 and 11.4 hereof, which shall
survive until such Securities shall mature and be paid. Thereafter, this Section
11.1 and Sections 6.6, 6.10 and 11.4 shall survive, and the Trustee, on demand
of the Company accompanied by any Officers' Certificate and an Opinion of
Counsel and at the cost and expense of the Company, shall execute proper
instruments acknowledging satisfaction of and discharging this Indenture; the
35
Company, however, hereby agrees to reimburse the Trustee for any costs or
expenses thereafter reasonably and properly incurred by the Trustee in
connection with this Indenture or the Securities.
SECTION 11.2 Deposited Moneys and U.S. Government Obligations to be Held
in Trust by Trustee.
Subject to the provisions of Section 11.4, all moneys and U.S. Government
Obligations deposited with the Trustee pursuant to Section 11.1 or Section 11.5
shall be held in trust and applied by it to the payment, either directly or
through any paying agent (including the Company if acting as its own paying
agent), to the holders of the particular Securities for the payment of which
such moneys or U.S. Government Obligations have been deposited with the Trustee,
of all sums due and to become due thereon for principal and interest.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 11.5 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the holders of outstanding Securities.
SECTION 11.3 Paying Agent to Repay Moneys Held.
Upon the satisfaction and discharge of this Indenture all moneys then held
by any paying agent of the Securities (other than the Trustee) shall, upon
written demand of the Company, be repaid to it or paid to the Trustee, and
thereupon such paying agent shall be released from all further liability with
respect to such moneys.
SECTION 11.4 Return of Unclaimed Moneys.
Any moneys deposited with or paid to the Trustee or any paying agent for
payment of the principal of or interest on Securities and not applied but
remaining unclaimed by the holders of Securities for two years after the date
upon which the principal of or interest on such Securities, as the case may be,
shall have become due and payable, shall be repaid to the Company by the Trustee
or such paying agent on written demand; the holder of any of the Securities
shall thereafter look only to the Company for any payment which such holder may
be entitled to collect and all liability of the Trustee or such paying agent
with respect to such moneys shall thereupon cease.
SECTION 11.5 Defeasance Upon Deposit of Moneys or U.S. Government
Obligations.
The Company shall be deemed to have been Discharged (as defined below) from
its respective obligations with respect to any series of Securities on the 91st
day after the applicable conditions set forth below with respect to any series
of Securities have been satisfied:
(a) the Company shall have deposited or caused to be deposited irrevocably
with the Trustee or the Defeasance Agent (as defined below) as trust funds in
trust, specifically pledged as security for, and dedicated solely to, the
benefit of the holders of the Securities of such series (i) money in an amount,
or (ii) U.S. Government Obligations which through the payment of interest and
principal in respect thereof in accordance with their terms will provide, not
later than one day before the due date of any payment, money in an amount, or
(iii) a combination of (i) and (ii), sufficient, in the opinion (with respect to
(ii) and (iii)) of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee and the Defeasance Agent, if any, to pay and discharge each installment
of principal of and interest on the outstanding Securities of such series on the
dates such installments of principal or interest due;
(b) if the Securities of such series are then listed on any national
securities exchange, the Company shall have delivered to the Trustee and the
Defeasance Agent, if any, an Opinion of Counsel to the effect that the exercise
of the option under this Section 11.5 would not cause such Securities to be
delisted from such exchange;
(c) no Default or Event of Default with respect to the Securities of such
series shall have occurred and be continuing on the date of such deposit; and
36
(d) the Company shall have delivered to the Trustee and the Defeasance
Agent, if any, an Opinion of Counsel to the effect that holders of the
Securities of such series will not recognize income, gain or loss for United
States Federal income tax purposes as a result of the exercise of the option
under this Section 11.5 and will be subject to United States Federal income tax
on the same amount and in the same manner and at the same times as would have
been the case if such option had not been exercised, and in the case of the
Securities of such series being Discharged, such opinion shall be based on a
statute so providing or be accompanied by a private letter ruling to that effect
received from the United States Internal Revenue Service or a revenue ruling
pertaining to a comparable form of transaction to that effect published by the
United States Internal Revenue Service.
"Discharged" means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by, and obligations under, the
Securities of such series and to have satisfied all the obligations under this
Indenture relating to the Securities of such series (and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging the
same), except (A) the rights of holders of Securities of such series to receive,
from the trust fund described in clause (1) above, payment of the principal of
and the interest and premium, if any, on such Securities when such payments are
due; (B) the Company's obligations with respect to the Securities under Sections
2.6, 2.7, 5.2 and 11.4; and (C) the rights, powers, trusts, duties and
immunities of the Trustee hereunder.
"Defeasance Agent" means another financial institution which is eligible to
act as Trustee hereunder and which assumes all of the obligations of the Trustee
necessary to enable the Trustee to act hereunder. In the event such a
Defeasance Agent is appointed pursuant to this Section, the following conditions
shall apply:
(a) The Trustee shall have approval rights over the document appointing
such Defeasance Agent and the document setting forth such Defeasance Agent's
rights and responsibilities;
(b) The Defeasance Agent shall provide verification to the Trustee
acknowledging receipt of sufficient money and/or U. S. Government Obligations to
meet the applicable conditions set forth in this Section 11.5.
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
SECTION 12.1 Indenture and Securities Solely Corporate Obligations.
No recourse for the payment of the principal of or interest on any
Security, or for any claim based thereon or otherwise in respect thereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
this Indenture or in any supplemental indenture, or in any Security, or because
of the creation of any indebtedness represented thereby, shall be had against
any incorporator, stockholder, officer or director, as such, past, present or
future, of the Company or of any successor Person to the Company, either
directly or through the Company or any successor Person to the Company, whether
by virtue of any constitution, statute or rule of law, or by the enforcement of
any assessment or penalty or otherwise; it being expressly understood that all
such liability is hereby expressly waived and released as a condition of, and as
a consideration for, the execution of this Indenture and the issue of the
Securities.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.1 Successors.
All the covenants, stipulations, promises and agreements in this Indenture
contained by the Company shall bind its successors and assigns whether so
expressed or not.
37
SECTION 13.2 Official Acts by Successor Corporation.
Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer of the
Company shall and may be done and performed with like force and effect by the
like board, committee or officer of any corporation that shall at the time be
the lawful sole successor of the Company.
SECTION 13.3 Surrender of Company Powers.
The Company by instrument in writing executed by authority of 2/3 (two-
thirds) of its Board of Directors and delivered to the Trustee may surrender any
of the powers reserved to the Company, and thereupon such power so surrendered
shall terminate both as to the Company, as the case may be, and as to any
successor Person.
SECTION 13.4 Addresses for Notices, etc.
Any notice or demand which by any provision of this Indenture is required
or permitted to be given or served by the Trustee or by the holders of
Securities on the Company may be given or served by being deposited postage
prepaid by first class mail, registered or certified mail, overnight courier
service or conformed telecopy addressed (until another address is filed by the
Company with the Trustee for the purpose) to the Company at 00000 Xxxxxxxxx
Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000, Attention: Vice President, Secretary
and Chief Financial Officer. Any notice, direction, request or demand by any
Securityholder to or upon the Trustee shall be deemed to have been sufficiently
given or made, for all purposes, if given or made in writing at the office of
the Trustee, Bankers Trust Company, Four Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Corporate Trust and Agency Services (unless another address is
provided by the Trustee to the Company for such purpose). Any notice or
communication to a Securityholder shall be mailed by first class mail to his or
her address shown on the register kept by the Security Registrar.
SECTION 13.5 Governing Law.
THIS INDENTURE AND EACH SECURITY SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE.
SECTION 13.6 Evidence of Compliance with Conditions Precedent.
Upon any application or demand by the Company to the Trustee to take any
action under any of the provisions of this Indenture, the Company shall furnish
to the Trustee an Officers' Certificate stating that in the opinion of the
signers all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with and an Opinion of
Counsel stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.
Each certificate or opinion provided for in this Indenture and delivered to
the Trustee with respect to compliance with a condition or covenant provided for
in this Indenture (except certificates delivered pursuant to Section 3.5) shall
include (1) a statement that the Person making such certificate or opinion has
read such covenant or condition; (2) a brief statement as to the nature and
scope of the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based; (3) a statement that, in the
opinion of such Person, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or not such
covenant or condition has been complied with; and (4) a statement as to whether
or not, in the opinion of such person, such condition or covenant has been
complied with.
SECTION 13.7 Business Days.
In any case where the date of payment of principal of (or premium, if any)
or interest on the Securities will not be a Business Day, the payment of such
principal of (or premium, if any) or interest on the Securities need not be made
on such date but may be made on the next succeeding Business Day, with the same
force and effect as if
38
made on the date of payment and no interest shall accrue for the period from and
after such date, except that if such next succeeding Business Day falls in the
next succeeding calendar year, then such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date.
SECTION 13.8 Trust Indenture Act to Control.
If and to the extent that any provision of this Indenture limits, qualifies
or conflicts with the duties imposed by Sections 310 to 317, inclusive, of the
Trust Indenture Act, such imposed duties shall control.
SECTION 13.9 Table of Contents, Headings, etc.
The table of contents and the titles and headings of the articles and
sections of this Indenture have been inserted for convenience of reference only,
are not to be considered a part hereof, and shall in no way modify or restrict
any of the terms or provisions hereof.
SECTION 13.10 Execution in Counterparts.
This Indenture may be executed in any number of counterparts, each of which
shall be an original, but such counterparts shall together constitute but one
and the same instrument.
SECTION 13.11 Separability.
In case any one or more of the provisions contained in this Indenture or in
the Securities of any series shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Indenture or of such Securities,
but this Indenture and such Securities shall be construed as if such invalid or
illegal or unenforceable provision had never been contained herein or therein.
SECTION 13.12 Assignment.
The Company will have the right at all times to assign any of its
respective rights or obligations under this Indenture to a direct or indirect
wholly owned Subsidiary of the Company, provided that, in the event of any such
assignment, the Company will remain liable for all such obligations. Subject to
the foregoing, the Indenture is binding upon and inures to the benefit of the
parties thereto and their respective successors and assigns. This Indenture may
not otherwise be assigned by the parties thereto.
SECTION 13.13 Acknowledgement of Rights.
The Company acknowledges that, with respect to any Securities held by any
Sterling Capital Trust or a trustee of any such Trust, if the Property Trustee
of such Trust fails to enforce its rights under this Indenture as the holder of
the series of Securities held as the assets of such Sterling Capital Trust, any
holder of Trust Preferred Securities may institute legal proceedings directly
against the Company to enforce such Property Trustee's rights under this
Indenture without first instituting any legal proceedings against such Property
Trustee or any other person or entity. Notwithstanding the foregoing, if an
Event of Default has occurred and is continuing and such event is attributable
to the failure of the Company to pay principal of or interest on the applicable
series of Securities when due, the Company acknowledges that a holder of Trust
Preferred Securities may directly institute a proceeding for enforcement of
payment to such holder of the principal of or interest on the applicable series
of Securities having a principal amount equal to the aggregate liquidation
amount of the Trust Preferred Securities of such holder on or after the
respective due date specified in the applicable series of Securities.
39
ARTICLE XIV
PREPAYMENT OF SECURITIES
SECTION 14.1 Applicability of Article.
The provisions of this Article shall be applicable to the Securities of any
series which, by their terms, may be prepaid before their maturity except as
otherwise as specified as contemplated by Section 2.2 for Securities of such
series.
SECTION 14.2 Notice of Prepayment; Selection of Securities.
In case the Company shall desire to exercise the right to prepay all, or,
as the case may be, any part of the Securities of any series in accordance with
their terms, it shall fix a date for prepayment and shall mail a notice of such
prepayment at least 30 and not more than 60 days prior to the date fixed for
prepayment to the holders of Securities of such series to be so prepaid as a
whole or in part at their last addresses as the same appear on the Security
Register. Such mailing shall be by first class mail. The notice if mailed in
the manner herein provided shall be conclusively presumed to have been duly
given, whether or not the holder receives such notice. In any case, failure to
give such notice by mail or any defect in the notice to the holder of any
Security of a series designated for prepayment as a whole or in part shall not
affect the validity of the proceedings for the prepayment of any other Security
of such series.
Each such notice of prepayment shall identify the Securities to be prepaid
(including the CUSIP number), the date fixed for prepayment, the prepayment
price at which the Securities are to be prepaid (or the method by which such
prepayment price is to be calculated), the place or places of payment that
payment will be made upon presentation and surrender of such Securities, that
interest accrued to the date fixed for prepayment will be paid as specified in
said notice, and that on and after said date interest thereon or on the portions
thereof to be prepaid will cease to accrue. If less than all the Securities of
such series are to be prepaid, the notice of prepayment shall specify the number
of the Securities of that series to be prepaid. In case any Security of a
series is to be prepaid in part only, the notice of prepayment shall state the
portion of the principal amount thereof to be redeemed and shall state that on
and after the date fixed for prepayment, upon surrender of such Security, a new
Security or Securities of that series in principal amount equal to the portion
thereof that has not been prepaid will be issued.
By 10:00 a.m. New York time on the prepayment date specified in the notice
of prepayment given as provided in this Section, the Company will deposit with
the Trustee or with one or more paying agents an amount of money sufficient to
prepay on the prepayment date all the Securities so called for prepayment at the
appropriate prepayment price, together with accrued interest to the date fixed
for prepayment.
If the Securities of a series are to be redeemed, the Company will give the
Trustee notice not less than 45 days prior to the prepayment date as to the
aggregate principal amount of Securities of that series to be prepaid and, in
the case of partial prepayment, the Trustee shall select, in such manner as in
its sole discretion it shall deem appropriate and fair, the Securities of that
series or portions thereof (in integral multiples of $25, except as otherwise
set forth in the applicable form of Security) to be prepaid.
SECTION 14.3 Payment of Securities Called for Prepayment.
If notice of prepayment has been given as provided in Section 14.2, the
Securities or portions of Securities of that series with respect to which such
notice has been given shall become due and payable on the date and at the place
or places stated in such notice at the applicable prepayment price, together
with interest accrued to the date fixed for prepayment, and on and after said
date (unless the Company shall default in the payment of such Securities at the
applicable prepayment price, together with interest accrued to said date)
interest on the Securities or portions of Securities so called for prepayment
shall cease to accrue. On presentation and surrender of such Securities at a
place of payment specified in said notice, the said Securities or the specified
portions thereof shall be paid and
40
prepaid by the Company at the applicable prepayment price, together with
interest accrued thereon to the date fixed for prepayment.
Upon presentation of any Security of any series prepaid in part only, the
Company shall execute and the Trustee shall authenticate and make available for
delivery to the holder thereof, at the expense of the Company, a new Security or
Securities of such series of authorized denominations, in principal amount equal
to the portion of the Security so presented that has not been prepaid.
ARTICLE XV
SUBORDINATION OF SECURITIES
SECTION 15.1 Agreement to Subordinate.
The Company covenants and agrees, and each holder of Securities issued
hereunder and under any supplemental indenture or by any Board Resolution
("Additional Provisions") by such Securityholder's acceptance thereof, likewise
covenants and agrees, that all Securities shall be issued subject to the
provisions of this Article XV; and each holder of a Security, whether upon
original issue or upon transfer or assignment thereof, accepts and agrees to be
bound by such provisions.
The payment by the Company of the principal of and interest on all
Securities issued hereunder and under any Additional Provisions shall, to the
extent and in the manner hereinafter set forth, be subordinated and junior in
right of payment to all Senior Indebtedness, whether outstanding at the date of
this Indenture or thereafter incurred.
No provision of this Article XV shall prevent the occurrence of any Default
or Event of Default hereunder.
SECTION 15.2 Default on Senior Indebtedness.
In the event and during the continuation of any default by the Company in
the payment of principal, interest or any other payment due on any Senior
Indebtedness, or in the event that the maturity of any Senior Indebtedness has
been accelerated because of a default, then, in either case, no payment shall be
made by the Company with respect to the principal (including redemption
payments) of or interest on the Securities.
In the event of the acceleration of the maturity of the Securities, then no
payment shall be made by the Company with respect to the principal (including
redemption payments) of or interest on the Securities until the holders of all
Senior Indebtedness outstanding at the time of such acceleration shall receive
payment in full of such Senior Indebtedness (including any amounts due upon
acceleration).
In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee when such payment is prohibited by the preceding
paragraphs of this Section 15.2, such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Senior
Indebtedness or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Senior Indebtedness may have
been issued, as their respective interests may appear, but only to the extent
that the holders of the Senior Indebtedness (or their representative or
representatives or a trustee) notify the Trustee in writing within 90 days of
such payment of the amounts then due and owing on such Senior Indebtedness, and
only the amounts specified in such notice to the Trustee shall be paid to the
holders of such Senior Indebtedness.
SECTION 15.3 Liquidation; Dissolution; Bankruptcy.
Upon any payment by the Company or distribution of assets of the Company of
any kind or character, whether in cash, property or securities, to creditors
upon any dissolution or winding-up or liquidation or reorganization of the
Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all holders of Senior Indebtedness of the
Company shall first be paid in full, or payment thereof provided for in money in
accordance with its terms, before any payment is made by the Company on account
of the
41
principal or interest on the Securities; and upon any such dissolution or
winding-up or liquidation or reorganization, any payment by the Company, or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, which the Securityholders or the Trustee would be
entitled to receive from the Company, except for the provisions of this Article
XV, shall be paid by the Company or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the Securityholders or by the Trustee under the Indenture if received by
them or it, directly to the holders of Senior Indebtedness of the Company (pro
rata to such holders on the basis of the respective amounts of Senior
Indebtedness held by such holders, as calculated by the Company) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing such Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all such Senior Indebtedness in full, in money or money's
worth, after giving effect to any concurrent payment or distribution to or for
the holders of such Senior Indebtedness, before any payment or distribution is
made to the Securityholders or to the Trustee.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character prohibited by the
foregoing, whether in cash, property or securities, shall be received by the
Trustee before all Senior Indebtedness is paid in full, or provision is made for
such payment in money in accordance with its terms, such payment or distribution
shall be held in trust for the benefit of and shall be paid over or delivered to
the holders of such Senior Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Senior Indebtedness may have been issued,
as their respective interests may appear, as calculated by the Company, for
application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all such Senior Indebtedness in full in money in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the benefit of the holders of such Senior Indebtedness.
For purposes of this Article XV, the words "cash, property or securities"
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment, the payment of which is
subordinated at least to the extent provided in this Article XV with respect to
the Securities to the payment of Senior Indebtedness that may at the time be
outstanding, provided that (i) such Senior Indebtedness is assumed by the new
corporation, if any, resulting from any such reorganization or readjustment, and
(ii) the rights of the holders of such Senior Indebtedness are not, without the
consent of such holders, altered by such reorganization or readjustment. The
consolidation of the Company with, or the merger of the Company into, another
Person or the liquidation or dissolution of the Company following the sale,
conveyance, transfer or lease of its property as an entirety, or substantially
as an entirety, to another Person upon the terms and conditions provided for in
Article X of this Indenture shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section 15.2 if such
other Person shall, as a part of such consolidation, merger, sale, conveyance,
transfer or lease, comply with the conditions stated in Article X of this
Indenture. Nothing in Section 15.2 or in this Section 15.3 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 6.6 of this
Indenture.
SECTION 15.4 Subrogation.
Subject to the payment in full of all Senior Indebtedness, the rights of
the Securityholders shall be subrogated to the rights of the holders of such
Senior Indebtedness to receive payments or distributions of cash, property or
securities of the Company, as the case may be, applicable to such Senior
Indebtedness until the principal of and interest on the Securities shall be paid
in full; and, for the purposes of such subrogation, no payments or distributions
to the holders of such Senior Indebtedness of any cash, property or securities
to which the Securityholders or the Trustee would be entitled except for the
provisions of this Article XV, and no payment over pursuant to the provisions of
this Article XV to or for the benefit of the holders of such Senior Indebtedness
by Securityholders or the Trustee, shall, as between the Company, its creditors
other than holders of Senior Indebtedness of the Company, and the holders of the
Securities, be deemed to be a payment by the Company to or on account of such
Senior Indebtedness. It is understood that the provisions of this Article XV
are and are intended solely for the purposes of defining the relative rights of
the holders of the Securities, on the one hand, and the holders of such Senior
Indebtedness on the other hand.
Nothing contained in this Article XV or elsewhere in this Indenture, any
Additional Provisions or in the Securities is intended to or shall impair, as
between the Company, its creditors other than the holders of Senior
42
Indebtedness of the Company, and the holders of the Securities, the obligation
of the Company, which is absolute and unconditional, to pay to the holders of
the Securities the principal of and interest on the Securities as and when the
same shall become due and payable in accordance with their terms, or is intended
to or shall affect the relative rights of the holders of the Securities and
creditors of the Company, as the case may be, other than the holders of Senior
Indebtedness, nor shall anything herein or therein prevent the Trustee or the
holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under the Indenture, subject to the rights, if any,
under this Article XV of the holders of such Senior Indebtedness in respect of
cash, property or securities of the Company, as the case may be, received upon
the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article XV, the Trustee, subject to the provisions of Article VI of this
Indenture, and the Securityholders shall be entitled to conclusively rely upon
any order or decree made by any court of competent jurisdiction in which such
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver, trustee in bankruptcy, liquidation trustee,
agent or other Person making such payment or distribution, delivered to the
Trustee or to the Securityholders, for the purposes of ascertaining the Persons
entitled to participate in such distribution, the holders of Senior Indebtedness
and other indebtedness of the Company, as the case may be, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article XV.
SECTION 15.5 Trustee to Effectuate Subordination.
Each Securityholder by such Securityholder's acceptance thereof authorizes
and directs the Trustee on such Securityholder's behalf to take such action as
may be necessary or appropriate to effectuate the subordination provided in this
Article XV and appoints the Trustee such Securityholder's attorney-in-fact for
any and all such purposes.
SECTION 15.6 Notice by the Company.
The Company shall give prompt written notice to a Responsible Officer of
the Trustee of any fact known to the Company that would prohibit the making of
any payment of monies to or by the Trustee in respect of the Securities pursuant
to the provisions of this Article XV. Notwithstanding the provisions of this
Article XV or any other provision of this Indenture or any Additional
Provisions, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment of monies to or by the
Trustee in respect of the Securities pursuant to the provisions of this Article
XV, unless and until a Responsible Officer of the Trustee shall have received
written notice thereof from the Company or a holder or holders of Senior
Indebtedness or from any trustee therefor; and before the receipt of any such
written notice, the Trustee, subject to the provisions of Article VI of this
Indenture, shall be entitled in all respects to assume that no such facts exist;
provided, however, that if the Trustee shall not have received the notice
provided for in this Section 15.6 at least two Business Days prior to the date
upon which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of or interest on
any Security), then, anything herein contained to the contrary notwithstanding,
the Trustee shall have full power and authority to receive such money and to
apply the same to the purposes for which they were received, and shall not be
affected by any notice to the contrary that may be received by it within two
Business Days prior to such date.
The Trustee, subject to the provisions of Article VI of this Indenture,
shall be entitled to conclusively rely on the delivery to it of a written notice
by a Person representing himself to be a holder of Senior Indebtedness of the
Company (or a trustee on behalf of such holder), as the case may be, to
establish that such notice has been given by a holder of such Senior
Indebtedness or a trustee on behalf of any such holder or holders. In the event
that the Trustee determines in good faith that further evidence is required with
respect to the right of any Person as a holder of such Senior Indebtedness to
participate in any payment or distribution pursuant to this Article XV, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of such Senior Indebtedness held by
such Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article XV, and, if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
43
Upon any payment or distribution of assets of the Company referred to in
this Article XV, the Trustee and the Securityholders shall be entitled to
conclusively rely upon any order or decree entered by any court of competent
jurisdiction in which such insolvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy, liquidating trustee,
custodian, receiver, assignee for the benefit of creditors, agent or other
person making such payment or distribution, delivered to the Trustee or to the
Securityholders, for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of Senior Indebtedness
and other indebtedness of the Company, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article XV.
SECTION 15.7 Rights of the Trustee; Holders of Senior Indebtedness.
The Trustee in its individual capacity shall be entitled to all the rights
set forth in this Article XV in respect of any Senior Indebtedness at any time
held by it, to the same extent as any other holder of Senior Indebtedness, and
nothing in this Indenture shall deprive the Trustee of any of its rights as such
holder.
With respect to the holders of Senior Indebtedness of the Company, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article XV, and no implied
covenants or obligations with respect to the holders of such Senior Indebtedness
shall be read into this Indenture or any Applicable Provisions against the
Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of such Senior Indebtedness and, subject to the provisions of Article VI
of this Indenture, the Trustee shall not be liable to any holder of such Senior
Indebtedness if it shall pay over or deliver to Securityholders, the Company or
any other Person money or assets to which any holder of such Senior Indebtedness
shall be entitled by virtue of this Article XV or otherwise.
Nothing in this Article XV shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 6.6.
SECTION 15.8 Subordination May Not Be Impaired.
No right of any present or future holder of any Senior Indebtedness of the
Company to enforce subordination as herein provided shall at any time in any way
be prejudiced or impaired by any act or failure to act on the part of the
Company, as the case may be, or by any act or failure to act, in good faith, by
any such holder, or by any noncompliance by the Company, as the case may be,
with the terms, provisions and covenants of this Indenture, regardless of any
knowledge thereof that any such holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Indebtedness of the Company may, at any time and from time to
time, without the consent of or notice to the Trustee or the Securityholders,
without incurring responsibility to the Securityholders and without impairing or
releasing the subordination provided in this Article XV or the obligations
hereunder of the holders of the Securities to the holders of such Senior
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter, such
Senior Indebtedness, or otherwise amend or supplement in any manner such Senior
Indebtedness or any instrument evidencing the same or any agreement under which
such Senior Indebtedness is outstanding; (ii) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing such
Senior Indebtedness; (iii) release any Person liable in any manner for the
collection of such Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company, as the case may be, and any other
Person.
Bankers Trust Company hereby accepts the trusts in this Indenture declared
and provided, upon the terms and conditions hereinabove set forth.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed by their respective officers thereunto duly authorized, as of the
day and year first above written.
44
STERLING BANCSHARES, INC.
By /s/ XXXXXX XXXXXXXX
-----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Chairman
BANKERS TRUST COMPANY,
as Trustee
By /s/ XXXXX XXXXXXX
-----------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
45
